{"id":43587,"date":"2015-09-17T11:25:58","date_gmt":"2015-09-17T16:25:58","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-legal\/contracts\/uncategorized\/separation-agreement-idt-corp-and-net2phone-inc.html"},"modified":"2015-09-17T11:25:58","modified_gmt":"2015-09-17T16:25:58","slug":"separation-agreement-idt-corp-and-net2phone-inc","status":"publish","type":"corporate_contracts","link":"https:\/\/corporate.findlaw.com\/contracts\/planning\/separation-agreement-idt-corp-and-net2phone-inc.html","title":{"rendered":"Separation Agreement &#8211; IDT Corp. and Net2Phone Inc."},"content":{"rendered":"<pre>\n                              SEPARATION AGREEMENT\n                              --------------------\n\n                                        \n     THIS SEPARATION AGREEMENT, dated as of May 7, 1999, is by and between IDT\nCorporation, a Delaware corporation (\"IDT\"), and Net2Phone, Inc., a Delaware\ncorporation (\"Net2Phone\"). Capitalized terms used herein and not otherwise\ndefined shall have the respective meanings assigned to them in Article I hereof.\n\n     WHEREAS, Net2Phone is currently a subsidiary of IDT;\n\n     WHEREAS, the Board of Directors of IDT has determined that it is\nappropriate and desirable to cause Net2Phone to offer and sell for its own\naccount equity interests in Net2Phone to additional investors;\n\n     WHEREAS, IDT has historically provided various services to Net2Phone on an\ninformal basis and, in connection with the separation of IDT and Net2Phone, the\nparties desire to formalize certain relationships which will continue as\ndescribed herein; and\n\n     WHEREAS, it is appropriate and desirable to set forth the principal\ncorporate transactions required to effect the separation, and certain other\nagreements that will govern certain matters relating to the relationship of IDT\nand Net2Phone following the sale of equity to additional investors.\n\n     NOW, THEREFORE, for good and valuable consideration, the sufficiency of\nwhich is hereby acknowledged, the parties, intending to be legally bound, agree\nas follows:\n\n\n                                   ARTICLE I\n                                  DEFINITIONS\n\n     For the purpose of this Agreement the following terms shall have the\nfollowing meanings:\n\n     1.1.  \"Action\" means any demand, action, suit, countersuit, arbitration,\ninquiry, proceeding or investigation by or before any federal, state, local,\nforeign or international Governmental Authority or any arbitration or mediation\ntribunal.\n\n     1.2.  \"Affiliate\" of any Person means a Person that controls, is controlled\nby, or is under common control with such Person. As used herein, \"control\" means\nthe possession, directly or indirectly, of the power to direct or cause the\ndirection of the management and policies of such entity, whether through\nownership of voting securities or other interests, by contract or otherwise.\n\n     1.3.  \"Agreement\" means this Separation Agreement, including all of the\nSchedules hereto.\n\n\n \n     1.4.  \"Ancillary Agreements\" means (a) the IDT Services Agreement, dated as\nof the date hereof, by and between IDT and Net2Phone, (b) the Net2Phone Services\nAgreement, dated the date hereof, by and between IDT and Net2Phone, (c) the\nInternet\/Telecommunications Agreement, dated the date hereof, by and between IDT\nand Net2Phone, (d) the Joint Marketing Agreement, dated the date hereof, by and\nbetween IDT and Net2Phone, (e) the Assignment Agreement, dated as of the date\nhereof, by and between IDT and Net2Phone, (f) the Tax Sharing and\nIndemnification Agreement, dated as of the date hereof, by and between IDT and\nNet2Phone, and (g) the Assignment and Assumption Agreement, dated as of the date\nhereof, by and between IDT and Net2Phone.\n\n     1.5.  \"Applicable Deadline\" has the meaning set forth in Section 8.3(b).\n\n     1.6.  \"Arbitration Act\" means the United States Arbitration Act, 9 U.S.C.\n1- 14, as the same may be amended from time to time.\n\n     1.7.  \"Arbitration Demand Date\" has the meaning set forth in Section\n8.3(a).\n\n     1.8.  \"Arbitration Demand Notice\" has the meaning set forth in Section\n8.3(a).\n\n     1.9.  \"Code\" means the Internal Revenue Code of 1986, as amended.\n\n     1.10. \"Commission\" means the United States Securities and Exchange\nCommission.\n\n     1.11. \"Consents\" means any consent, waiver or approval from, or\nnotification requirements to, any third party.\n\n     1.12. \"CPR\" means the Center for Public Resources.\n\n     1.13. \"Environmental Law\" means any federal, state, local, foreign or\ninternational statute, ordinance, rule, regulation, code, license, permit,\nauthorization, approval, consent, common law (including tort and environmental\nnuisance law), legal doctrine, order, judgment, decree, injunction, requirement\nor agreement with any Governmental Authority, now or hereafter in effect\nrelating to health, safety, pollution or the environment (including ambient air,\nsurface water, groundwater, land surface or subsurface strata) or to emissions,\ndischarges, releases or threatened releases of any substance currently or at any\ntime hereafter listed, defined, designated or classified as hazardous, toxic\nwaste, radioactive or dangerous, or otherwise regulated, under any of the\nforegoing, or otherwise relating to the manufacture, processing, distribution,\nuse, treatment, storage, disposal, transport or handling of any such substances,\nincluding the Comprehensive Environmental Response, Compensation and Liability\nAct, the Superfund Amendments and Reauthorization Act and the Resource\nConservation and Recovery Act and comparable provisions in state, local, foreign\nor international law.\n\n     1.14. \"Environmental Liabilities\" means all Liabilities relating to,\narising out of or resulting from any Environmental Law or contract or agreement\nrelating to environmental, health or safety matters (including all removal,\nremediation or cleanup costs, investigatory costs, governmental response costs,\nnatural resources damages, \n\n                                       2\n\n\n \nproperty damages, personal injury damages, costs of compliance with any\nsettlement, judgment or other determination of Liability and indemnity,\ncontribution or similar obligations) and all costs and expenses (including\nallocated costs of in-house counsel and other personnel), interest, fines,\npenalties or other monetary sanctions in connection therewith.\n\n     1.15.  \"Escalation Notice\" has the meaning set forth in Section 8.2.\n\n     1.16.  \"Exchange Act\" means the Securities Exchange Act of 1934, as\namended, together with the rules and regulations promulgated thereunder.\n\n     1.17.  \"Governmental Approval\" means any notice, report or other filing to\nbe made, or any consent, registration, approval, permit or authorization to be\nobtained from, any Governmental Authority.\n\n     1.18.  \"Governmental Authority\" means any federal, state, local, foreign or\ninternational court, government, department, commission, board, bureau, agency,\nofficial or other regulatory, administrative or governmental authority.\n\n     1.19.  \"IDT Group\" means IDT and each Person (other than any member of the\nNet2Phone Group) that is an Affiliate of IDT on the date hereof.\n\n     1.20.  \"IDT Indemnitees\" has the meaning set forth in Section 5.2\n\n     1.21.  \"Indemnifying Party\" has the meaning set forth in Section 5.4(a).\n\n     1.22.  \"Indemnitee\" has the meaning set forth in Section 5.4(a).\n\n     1.23.  \"Indemnity Payment\" has the meaning set forth in Section 5.4(a).\n\n     1.24.  \"Information\" means information, whether or not patentable or\ncopyrightable, in written, oral, electronic or other tangible or intangible\nforms, stored in any medium, including studies, reports, records, books,\ncontracts, instruments, surveys, discoveries, ideas, concepts, know-how,\ntechniques, designs, specifications, drawings, blueprints, diagrams, models,\nprototypes, samples, flow charts, data, computer data, disks, diskettes, tapes,\ncomputer programs or other software, marketing plans, customer names,\ncommunications by or to attorneys (including attorney-client privileged\ncommunications), memos and other materials prepared by attorneys or under their\ndirection (including attorney work product), and other technical, financial,\nemployee or business information or data.\n\n     1.25.  \"Insurance Policies\" means the insurance policies written by\ninsurance carriers unaffiliated with IDT pursuant to which members of the\nNet2Phone Group (or their respective officers or directors) will be insured\nparties after the date hereof.\n\n     1.26.  \"Insurance Proceeds\" means those monies:\n\n            (a) received by an insured from an insurance carrier; or\n\n                                       3\n\n\n \n            (b) paid by an insurance carrier on behalf of the insured;\n\nin any such case net of any applicable premium adjustments (including reserves\nand retrospectively rated premium adjustments) and net of any costs or expenses\nincurred in the collection thereof.\n\n     1.27.  \"Liabilities\" means any and all losses, claims, charges, debts,\ndemands, actions, causes of action, suits, damages, obligations, payments, costs\nand expenses, sums of money, accounts, reckonings, bonds, specialties,\nindemnities and similar obligations, exonerations, covenants, contracts,\ncontroversies, agreements, promises, doings, omissions, variances, guarantees,\nmake whole agreements and similar obligations, and other liabilities, including\nall contractual obligations, whether absolute or contingent, matured or\nunmatured, liquidated or unliquidated, accrued or unaccrued, known or unknown,\nwhenever arising, and including those arising under any law, rule, regulation,\nAction, threatened or contemplated Action (including the costs and expenses of\ndemands, assessments, judgments, settlements and compromises relating thereto\nand attorneys' fees and any and all costs and expenses (including allocated\ncosts of in-house counsel and other personnel), whatsoever reasonably incurred\nin investigating, preparing or defending against any such Actions or threatened\nor contemplated Actions), order or consent decree of any Governmental Authority\nor any award of any arbitrator or mediator of any kind, and those arising under\nany contract, commitment or undertaking, including those arising under this\nAgreement or any Ancillary Agreement, in each case, whether or not recorded or\nreflected or required to be recorded or reflected on the books and records or\nfinancial statements of any Person.\n\n     1.28.  \"Net2Phone Business\" means the business of Net2Phone as presently\nconducted and as more fully described on Exhibit A hereto.\n                                         ---------        \n\n     1.29.  \"Net2Phone Common Stock\" means the common stock, $.01 par value per\nshare, of Net2Phone.\n\n     1.30.  \"Net2Phone Group\" means Net2Phone, each Subsidiary of Net2Phone and\neach other Person that is either controlled directly or indirectly by Net2Phone\non the date hereof.\n\n     1.31.  \"Net2Phone Indemnitees\" has the meaning set forth in Section 5.3(a).\n\n     1.32.  \"Person\" means an individual, a general or limited partnership, a\ncorporation, a trust, a joint venture, an unincorporated organization, a limited\nliability entity, any other entity and any Governmental Authority.\n\n     1.33.  \"Prime Rate\" means the rate which Chase Manhattan Bank (or any\nsuccessor thereto or other major money center commercial bank agreed to by the\nparties hereto) announces from time to time as its prime lending rate, as in\neffect from time to time.\n\n     1.34.  \"Securities Act\" means the Securities Act of 1933, as amended,\ntogether with the rules and regulations promulgated thereunder.\n\n                                       4\n\n\n \n     1.35.  \"Security Interest\" means any mortgage, security interest, pledge,\nlien, charge, claim, option, right to acquire, voting or other restriction,\nright-of-way, covenant, condition, easement, encroachment, restriction on\ntransfer, or other encumbrance of any nature whatsoever.\n\n     1.36.  \"Subsidiary of any Person\" means any corporation or other\norganization whether incorporated or unincorporated of which at least a majority\nof the securities or interests having by the terms thereof ordinary voting power\nto elect at least a majority of the board of directors or others performing\nsimilar functions with respect to such corporation or other organization is\ndirectly or indirectly owned or controlled by such Person or by any one or more\nof its Subsidiaries, or by such Person and one or more of its Subsidiaries;\nprovided, however, that no Person shall be deemed to be a Subsidiary of such\n--------  -------                                                           \nother Person unless such other Person controls, or has the right, power or\nability to control, that Person.\n\n     1.37.  \"Tax Agreement\" means the Tax Sharing and Indemnification Agreement,\ndated as of the date hereof, by and between IDT and Net2Phone.\n\n     1.38.  \"Taxes\" has the meaning set forth in the Tax Agreement.\n\n     1.39.  \"Third Party Claim\" has the meaning set forth in Section 5.5(a).\n\n                                   ARTICLE II\n                            ANCILLARY AGREEMENTS AND\n                                 TAX AGREEMENT\n\n     2.1.  ANCILLARY AGREEMENTS.  Prior to the date hereof, IDT has provided\nNet2Phone with administration (accounting, human resources, legal), customer\nservice, Internet\/telecom, and marketing services and Net2Phone has provided IDT\nwith marketing and certain technical support services.  Net2Phone and IDT will\nenter into the Ancillary Agreements pursuant to which IDT will provide certain\nof such services to Net2Phone for those periods of time set forth in the\nrespective Ancillary Agreements and Net2Phone will provide certain of such\nservices to IDT for those periods of time set forth in the respective Ancillary\nAgreements.  Effective as of the date hereof, each of IDT and Net2Phone will\nexecute and deliver all of the Ancillary Agreements and the Tax Agreement.\n\n                                  ARTICLE III\n                             INTER-COMPANY LICENSES\n\n     3.1  The parties may desire to provide each other from time to time, at\ntheir sole and absolute discretion, certain software, know-how, or other\ntechnology for which they have the rights to grant licenses to third parties\n(\"Shared Technology\") for use in the other party's business.  To provide Shared\nTechnology, the party granting rights (the \"Granting Party\") to such Shared\nTechnology will identify the specific Shared Technology to be provided to the\nother party (the \"Receiving Party\") in a written notice (the \"License Notice\"),\nsigned by a duly authorized representative of the Granting Party, \n\n                                       5\n\n\n \nwhich references this Agreement and states that a license to such Shared\nTechnology is being granted to the Receiving Party pursuant to the terms of this\nAgreement. The specific Shared Technology licensed pursuant to a given License\nNotice will be licensed under the following terms and conditions unless stated\notherwise in such License Notice (provided that any changed or additional terms\ntherein shall be subject to signed approval by both the Granting Party and the\nReceiving Party):\n\n     (a) LICENSE GRANT.  Granting Party will grant to Receiving Party a non-\nexclusive, non-transferable, royalty-free, revocable license to use, make, copy\nand practice the Shared Technology designated in the License Notice solely for\ninternal business purposes.  The term of the license granted herein shall be\nindefinite, provided, however, that Granting Party may revoke such license upon\nthirty (30) days prior written notice at any time and for any reason, or for no\nreason.\n \n     (b) LIMITATIONS ON RIGHTS.  Receiving Party will not modify, create\nderivative works based upon, translate, decompile, disassemble or otherwise\nreverse engineer, distribute, transfer, time-share, service bureau or otherwise\nprovide any third parties access to, the Shared Technology licensed to it\npursuant to an applicable License Notice, or permit any third party to do any of\nthe foregoing..\n\n     (c) PROPRIETARY RIGHTS.  Granting Party will retain all right, title and\ninterest in and to the Shared Technology, and no right, title or interest will\nbe deemed to be granted or transferred to Receiving Party, except as expressly\nprovided for above or in the applicable License Notice.  Receiving Party agrees\nto retain or reproduce any proprietary rights notices on all copies of the\nShared Technology that it possesses or makes.\n\n     (d) NO WARRANTY.  EXCEPT AS OTHERWISE PROVIDED IN AN APPLICABLE LICENSE\nNOTICE, THE SHARED TECHNOLOGY IS PROVIDED \"AS IS\" WITHOUT WARRANTY OF ANY KIND\nAND THE PARTIES HEREBY DISCLAIM ALL WARRANTIES OF ANY KIND WITH RESPECT TO ANY\nOF THE SHARED TECHNOLOGY, INCLUDING, WITHOUT LIMITATION, ANY IMPLIED WARRANTIES\nOF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.\n\n     (e) LIMITATION OF LIABILITY.  EXCEPT AS OTHERWISE PROVIDED IN AN APPLICABLE\nLICENSE NOTICE, NEITHER PARTY WILL BE LIABLE TO THE OTHER FOR ANY CONSEQUENTIAL,\nINCIDENTAL, SPECIAL, INDIRECT, EXEMPLARY OR PUNITIVE DAMAGES OF ANY KIND WITH\nRESPECT TO THE SHARED TECHNOLOGY, EVEN IF SUCH PARTY IS NOTIFIED OF THE\nPOSSIBILITY OF SUCH DAMAGES.\n\n                                       6\n\n\n \n                                   ARTICLE IV\n                     OFFICE FURNITURE AND OFFICE EQUIPMENT\n\n     4.1  All office furniture and office equipment used by Net2Phone and\nlocated in its premises on the date hereof shall continue in the possession of\nNet2Phone.  To the extent that any such office furniture or office equipment is,\nor becomes, legally owned by IDT, IDT hereby transfers all its right, title and\ninterest therein to Net2Phone effective, with respect to such furniture and\nequipment currently owned by IDT, on the date hereof and effective, with respect\nto any such furniture and equipment which becomes owned by IDT at a future, on\nsuch date  To the extent that any such office furniture or office equipment is\nleased by IDT, IDT hereby affirms its intent that such furniture and equipment\nis part of IDT's capital contribution to Net2Phone and indemnifies Net2Phone\nfrom any and all claims whenever raised by any lessor of such furniture and\nequipment.\n\n                                   ARTICLE V\n                                INDEMNIFICATION\n\n     5.1.  RELEASE OF EXISTING CLAIMS. (a) Except as provided in Section 5.1(c),\neffective as of the date hereof, Net2Phone does hereby, for itself, its\nrespective Affiliates (other than any member of the IDT Group), successors and\nassigns, and all Persons who at any time prior to the date hereof have been\nstockholders, directors, officers, agents or employees of any member of the\nNet2Phone Group (in each case, in their respective capacities as such), remise,\nrelease and forever discharge each of IDT, its respective Affiliates (other than\nany member of the Net2Phone Group), successors and assigns, and all prior,\ncurrent or future stockholders, directors, officers, agents or employees of IDT\n(in each case, in their respective capacities as such), and their respective\nheirs, executors, administrators, successors and assigns, from any and all\nLiabilities whatsoever, whether at law or in equity (including any right of\ncontribution), whether arising under any contract or agreement, by operation of\nlaw or otherwise, existing or arising from all acts and events occurring or\nfailing to occur or alleged to have occurred or to have failed to occur and all\nconditions existing or alleged to have existed on or before the date hereof\nbetween Net2Phone and IDT (including any contractual arrangements or\narrangements existing or alleged to exist between them on or before the date\nhereof).\n\n     (b) Except as provided in Section 5.1(c), effective as of the date hereof,\nIDT does hereby, for itself and its Affiliates (other than any member of the\nNet2Phone Group), successors and assigns, and all Persons who at any time prior\nto the date hereof have been stockholders, directors, officers, agents or\nemployees of any member of the IDT Group (in each case, in their respective\ncapacities as such), remise, release and forever discharge Net2Phone, the\nrespective members of the Net2Phone Group, their respective Affiliates (other\nthan any member of the IDT Group), successors and assigns, and all prior,\ncurrent or future stockholders, directors, officers, agents or employees of any\nmember of the Net2Phone Group (in each case, in their respective capacities as\nsuch), and their respective heirs, executors, administrators, successors and\nassigns, from any and all Liabilities whatsoever, whether at law or in equity\n(including any right of \n\n                                       7\n\n\n \ncontribution), whether arising under any contract or agreement, by operation of\nlaw or otherwise, existing or arising from all acts and events occurring or\nfailing to occur or alleged to have occurred or to have failed to occur and all\nconditions existing or alleged to have existed on or before the date hereof\nbetween Net2Phone and IDT (including any contractual arrangements or\narrangements existing or alleged to exist between them on or before the date\nhereof).\n\n     (c) Nothing contained in Section 5.1(a) or (b) shall impair any right of\nany Person to enforce this Agreement, any Ancillary Agreement, or the Tax\nAgreement. Nothing contained in Section 5.1(a) or (b) shall release any Person\nfrom:\n\n     (i)   any Liability, contingent or otherwise, assumed, transferred,\nassigned or allocated to the Group of which such Person is a member in\naccordance with, or any other Liability of any member of any Group under, this\nAgreement, any Ancillary Agreement or the Tax Agreement;\n\n     (ii)  any Liability for the sale, lease, construction or receipt of goods,\nproperty or services purchased, obtained or used in the ordinary course of\nbusiness by a member of one Group from a member of any other Group prior to the\ndate hereof;\n\n     (iii) any Liability for unpaid amounts for products or services or refunds\nowing on products or services due on a value-received basis for work done by a\nmember of one Group at the request or on behalf of a member of another Group;\n\n     (iv)  any Liability that the parties may have with respect to\nindemnification or contribution pursuant to this Agreement for claims brought\nagainst the parties by third Persons, which Liability shall be governed by the\nprovisions of this Article V and Article VI and, if applicable, the appropriate\nprovisions of the Ancillary Agreements; or\n\n     (v)   in the case of Net2Phone, outstanding unpaid amounts as of the date\nhereof advanced to Net2Phone for working capital and fixed asset purchases and\nto reimburse IDT for bank finance charges incurred not to exceed $14 million, $7\nmillion of which will be repaid with proceeds from Net2Phone's sale of equity in\nconnection with its proposed initial public offering, with the remaining $7\nmillion being repaid in full not later than 60 months following the date hereof,\nself amortizing at the interest rate of 9% per annum in equal monthly payments.\n\n     (vi)  in the case of Net2Phone, $7 million which was advanced by IDT to\nNetscape and $1 million which was advanced to IBM all of which will be repaid by\nNet2Phone to IDT out of the proceeds of the private offering.\n\n     (vii) any Liability the release of which would result in the release of\nany Person other than a Person released pursuant to this Section 5.1; provided\nthat the parties agree not to bring suit or permit any of their Subsidiaries to\nbring suit against any Person with respect to any Liability to the extent that\nsuch Person would be released with respect to such Liability by this Section 5.1\nbut for the provisions of this clause (vi).\n\n     (viii) in the case if IDT, any Liability to Clifford Sobel pursuant to his\n\n                                       8\n\n\n \nemployment agreement (including option and stock conversion rights thereunder)\nor to any Net2Phone employee as a result of rights of such employee any employee\nbenefit plan, including any stock option plan.\n\n     (d) Net2Phone shall not make, and shall not permit any member of the\nNet2Phone Group to make, any claim or demand, or commence any Action asserting\nany claim or demand, including any claim of contribution or any indemnification,\nagainst IDT or any member of the IDT Group or any other Person released pursuant\nto Section 5.1(a), with respect to any Liabilities released pursuant to Section\n5.1(a). IDT shall not, and shall not permit any member of the IDT Group, to make\nany claim or demand, or commence any Action asserting any claim or demand,\nincluding any claim of contribution or any indemnification, against Net2Phone or\nany member of the Net2Phone Group, or any other Person released pursuant to\nSection 5.1(b), with respect to any Liabilities released pursuant to Section\n5.1(b).\n\n     (e) It is the intent of each of IDT and Net2Phone by virtue of the\nprovisions of this Section 5.1 to provide for a full and complete release and\ndischarge of all Liabilities existing or arising from all acts and events\noccurring or failing to occur or alleged to have occurred or to have failed to\noccur and all conditions existing or alleged to have existed on or before the\ndate hereof, between or among Net2Phone or any member of the Net2Phone Group, on\nthe one hand, and IDT or any member of the IDT Group, on the other hand\n(including any contractual agreements or arrangements existing or alleged to\nexist between or among any such members on or before the date hereof), except as\nexpressly set forth in Section 5.1(c). At any time, at the request of any other\nparty, each party shall cause each member of its respective Group to execute and\ndeliver releases reflecting the provisions hereof.\n\n     5.2.  INDEMNIFICATION BY NET2PHONE. Except as provided in Section 5.4,\nNet2Phone shall indemnify, defend and hold harmless IDT, each member of the IDT\nGroup and each of their respective directors, officers and employees (in each\ncase, in their respective capacities as such), and each of the heirs, executors,\nsuccessors and assigns of any of the foregoing (collectively, the \"IDT\nIndemnitees\"), from and against any and all Liabilities of the IDT Indemnitees\nrelating to, arising out of or resulting from any of the following items\n(without duplication):\n\n     (a) the failure of Net2Phone or any other member of the Net2Phone Group or\nany other Person to pay, perform or otherwise promptly discharge any liabilities\nof Net2Phone in accordance with their respective terms, whether prior to or\nafter the date hereof; and\n\n     (b) any breach by Net2Phone or any member of the Net2Phone Group of this\nAgreement, any of the Ancillary Agreements or the Tax Agreement; provided,\n                                                                 ---------\nhowever, that Net2Phone shall not be financially responsible hereunder for any\n--------                                                                      \nspecial, incidental, consequential or other similar type of damage to the extent\nthat such damages are specifically excluded in such agreement.\n\n     5.3.  INDEMNIFICATION BY IDT.  Except as otherwise provided in Section \n\n                                       9\n\n\n \n5.4, IDT shall indemnify, defend and hold harmless Net2Phone, each member of the\nNet2Phone Group and each of their respective directors, officers and employees\n(in each case, in their respective capacities as such), and each of the heirs,\nexecutors, successors and assigns of any of the foregoing (collectively, the\n\"Net2Phone Indemnitees\"), from and against any and all Liabilities of the\nNet2Phone Indemnitees relating to, arising out of or resulting from any of the\nfollowing items (without duplication):\n\n     (a) the failure of IDT or any other member of the IDT Group or any other\nPerson to pay, perform or otherwise promptly discharge any Liabilities of the\nIDT Group, whether prior to or after the date hereof; and\n\n     (b) any breach by IDT or any member of the IDT Group of this Agreement, any\nof the Ancillary Agreements or the Tax Agreement; provided, however, that IDT\n                                                  ------------------         \nshall not be financially responsible hereunder for any special, incidental,\nconsequential or other similar type of damage to the extent that such damages\nare specifically excluded in such agreement.\n\n     5.4.  INDEMNIFICATION OBLIGATIONS NET OF INSURANCE PROCEEDS AND OTHER\nAMOUNTS.  (a) The parties intend that any Liability subject to indemnification\nor reimbursement pursuant to this Article V or Article VI will be net of\nInsurance Proceeds that actually reduce the amount of the Liability.\nAccordingly, the amount which any party (an \"Indemnifying Party\") is required to\npay to any Person entitled to indemnification hereunder (an \"Indemnitee\") will\nbe reduced by any Insurance Proceeds theretofore actually recovered by or on\nbehalf of the Indemnitee in reduction of the related Liability.  If an\nIndemnitee receives a payment (an \"Indemnity Payment\") required by this\nAgreement from an Indemnifying Party in respect of any Liability and\nsubsequently receives Insurance Proceeds, then the Indemnitee will pay to the\nIndemnifying Party an amount equal to the excess of the Indemnity Payment\nreceived over the amount of the Indemnity Payment that would have been due if\nthe Insurance Proceeds had been received, realized or recovered before the\nIndemnity Payment was made.\n\n     (b) An insurer who would otherwise be obligated to pay any claim shall not\nbe relieved of the responsibility with respect thereto or, solely by virtue of\nthe indemnification provisions hereof, have any subrogation rights with respect\nthereto, it being expressly understood and agreed that no insurer or any other\nthird party shall be entitled to a \"windfall\" (i.e., a benefit they would not be\nentitled to receive in the absence of the indemnification provisions) by virtue\nof the indemnification provisions hereof. Nothing contained in this Agreement,\nany Ancillary Agreement or the Tax Agreement shall obligate any member of any\nGroup to seek to collect or recover any Insurance Proceeds.\n\n     5.5.  PROCEDURES FOR INDEMNIFICATION OF THIRD PARTY CLAIMS. (a) If an\nIndemnitee shall receive notice or otherwise learn of the assertion by a Person\n(including any Governmental Authority) who is not a member of the IDT Group or\nthe Net2Phone Group of any claim or of the commencement by any such Person of\nany Action (collectively, a \"Third Party Claim\") with respect to which an\nIndemnifying \n\n                                       10\n\n\n \nParty may be obligated to provide indemnification to such Indemnitee pursuant to\nSection 5.2 or 5.3, or any other Section of this Agreement, any Ancillary\nAgreement or the Tax Agreement, such Indemnitee shall give such Indemnifying\nParty written notice thereof within 20 days after becoming aware of such Third\nParty Claim. Any such notice shall describe the Third Party Claim in reasonable\ndetail. Notwithstanding the foregoing, the failure of any Indemnitee or other\nPerson to give notice as provided in this Section 5.5(a) shall not relieve the\nrelated Indemnifying Party of its obligations under this Article V, except to\nthe extent that such Indemnifying Party is actually prejudiced by such failure\nto give notice.\n\n     (b) An Indemnifying Party may elect to defend (and, unless the Indemnifying\nParty has specified any reservations or exceptions, to seek to settle or\ncompromise), at such Indemnifying Party's own expense and by such Indemnifying\nParty's own counsel, any Third Party Claim. Within 30 days after the receipt of\nnotice from an Indemnitee in accordance with Section 5.5(a) (or sooner, if the\nnature of such Third Party Claim so requires), the Indemnifying Party shall\nnotify the Indemnitee of its election whether the Indemnifying Party will assume\nresponsibility for defending such Third Party Claim, which election shall\nspecify any reservations or exceptions. After notice from an Indemnifying Party\nto an Indemnitee of its election to assume the defense of a Third Party Claim,\nsuch Indemnitee shall have the right to employ separate counsel and to\nparticipate in (but not control) the defense, compromise, or settlement thereof,\nbut the fees and expenses of such counsel shall be the expense of such\nIndemnitee except as set forth in the next sentence. In the event that the\nIndemnifying Party has elected to assume the defense of the Third Party Claim\nbut has specified, and continues to assert, any reservations or exceptions in\nsuch notice, then, in any such case, the reasonable fees and expenses of one\nseparate counsel for all Indemnitees shall be borne by the Indemnifying Party.\n\n     (c) If an Indemnifying Party elects not to assume responsibility for\ndefending a Third Party Claim, or fails to notify an Indemnitee of its election\nas provided in Section 5.5(b), such Indemnitee may defend such Third Party Claim\nat the cost and expense of the Indemnifying Party.\n\n     (d) Unless the Indemnifying Party has failed to assume the defense of the\nThird Party Claim in accordance with the terms of this Agreement, no Indemnitee\nmay settle or compromise any Third Party Claim without the consent of the\nIndemnifying Party, which consent shall not be unreasonably withheld.\n\n     (e) No Indemnifying Party shall consent to entry of any judgment or enter\ninto any settlement of the Third Party Claim without the consent of the\nIndemnitee if the effect thereof is to permit any injunction, declaratory\njudgment, other order or other nonmonetary relief to be entered, directly or\nindirectly, against any Indemnitee.\n\n     (f) The provisions of Section 5.5 and Section 5.6 shall not apply to Taxes\n(which are covered by the Tax Agreement).\n\n     5.6.  ADDITIONAL MATTERS. (a) Any claim on account of a Liability which\n\n                                       11\n\n\n \ndoes not result from a Third Party Claim shall be asserted by written notice\ngiven by the Indemnitee to the related Indemnifying Party. Such Indemnifying\nParty shall have a period of 30 days after the receipt of such notice within\nwhich to respond thereto. If such Indemnifying Party does not respond within\nsuch 30-day period, such Indemnifying Party shall be deemed to have refused to\naccept responsibility to make payment. If such Indemnifying Party does not\nrespond within such 30-day period or rejects such claim in whole or in part,\nsuch Indemnitee shall be free to pursue such remedies as may be available to\nsuch party as contemplated by this Agreement, the Ancillary Agreements and the\nTax Agreement.\n\n     (b) In the event of payment by or on behalf of any Indemnifying Party to\nany Indemnitee in connection with any Third Party Claim, such Indemnifying Party\nshall be subrogated to and shall stand in the place of such Indemnitee as to any\nevents or circumstances in respect of which such Indemnitee may have any right,\ndefense or claim relating to such Third Party Claim against any claimant or\nplaintiff asserting such Third Party Claim or against any other person. Such\nIndemnitee shall cooperate with such Indemnifying Party in a reasonable manner,\nand at the cost and expense (including allocated costs of in-house counsel and\nother personnel) of such Indemnifying Party, in prosecuting any subrogated\nright, defense or claim.\n\n     (c) In the event of an Action in which the Indemnifying Party is not a\nnamed defendant, if the Indemnifying Party shall so request, the parties shall\nendeavor to substitute the Indemnifying Party for the named defendant if at all\npracticable. If such substitution or addition cannot be achieved for any reason\nor is not requested, the named defendant shall allow the Indemnifying Party to\nmanage the Action as set forth in this Section and the Indemnifying Party shall\nfully indemnify the named defendant against all costs of defending the Action\n(including court costs, sanctions imposed by a court, attorneys' fees, experts'\nfees and all other external expenses), the costs of any judgment or settlement,\nand the cost of any interest or penalties relating to any judgment or\nsettlement.\n\n     5.7.  REMEDIES CUMULATIVE.  The remedies provided in this Article V shall\nbe cumulative and, subject to the provisions of Article VIII, shall not preclude\nassertion by any Indemnitee of any other rights or the seeking of any and all\nother remedies against any Indemnifying Party.\n\n     5.8.  SURVIVAL OF INDEMNITIES.  The rights and obligations of each of IDT\nand Net2Phone and their respective Indemnitees under this Article V shall\nsurvive the sale or other transfer by any party of any Assets or businesses or\nthe assignment by it of any Liabilities.\n\n     5.9   UNAVAILABILITY OF INDEMNITY.  If the indemnification provided for in\nthis Article V is held by a court of competent jurisdiction to be unavailable to\nan indemnified party with respect to any Liabilities referred to herein, the\nindemnifying party, in lieu of indemnifying such indemnified party hereunder,\nagrees to contribute to the amount paid or payable by such indemnified party as\na result of such Liability in such proportion as is appropriate to reflect the\nrelative fault of the indemnifying party on one \n\n                                       12\n\n\n \nhand and of the indemnified party on the other in connection with the event that\nresulted in such Liability, as well as any other relevant equitable\nconsiderations.\n\n                                   ARTICLE VI\n                      OPERATIONS AND CERTAIN OTHER MATTERS\n\n     6.1.  INSURANCE MATTERS. (a)  Net2Phone and IDT contemplate that Net2Phone\nshall obtain its own Directors and Officers Insurance Policy in a timely manner\nfollowing the sale of equity to new investors.  Each of Net2Phone and IDT agree\nthat Net2Phone may remain on IDT's insurance policies relating to property,\nerrors and omissions, professional liability, automobile and general liability\nuntil the earlier of such time as Net2Phone no longer qualifies for coverage on\nthe respective IDT Insurance Policy or, upon thirty (30) days' prior written\nnotice to IDT, Net2Phone elects to be removed from the IDT Insurance Policy or\nPolicies.  For so long as Net2Phone is covered by IDT's Insurance Policies,\nNet2Phone will pay to IDT each month (prorated on a daily basis for any partial\nmonth) in respect of the period from the date hereof until the termination of\nNet2Phone's coverage on all of IDT's Insurance Policies the amount calculated as\nset forth on Exhibit B hereto, such amount to be payable in arrears by the 10th\n             ---------                                                         \nday of the next succeeding month, in respect of Insurance Policies under which\nNet2Phone will continue to have coverage following the date hereof.  IDT and\nNet2Phone agree to cooperate in good faith to provide for the treatment of any\nInsurance Policies that will remain in effect following the date hereof on a\nmutually agreeable basis.  IDT shall provide Net2Phone with prompt notice in the\nevent that any Insurance Policy shall be terminated or otherwise cease to be in\neffect for any reason.  In no event shall IDT, any other member of the IDT Group\nor any IDT Indemnitee have liability or obligation whatsoever to any member of\nthe Net2Phone Group in the event (i) that any Insurance Policy or other contract\nor policy of insurance shall be terminated or otherwise cease to be in effect\nfor any reason, shall be unavailable or inadequate to cover any Liability of any\nmember of the Net2Phone Group for any reason whatsoever or shall not be renewed\nor extended beyond the current expiration date. or (ii) notwithstanding the\nprovisions of the immediately preceding sentence, that IDT fails to provide\nNet2Phone with notice of any such event.\n\n     (b) (i)  Except as otherwise provided in any Ancillary Agreement, the\nparties intend by this Agreement that Net2Phone and each other member of the\nNet2Phone Group be successors-in-interest to all rights that any member of the\nNet2Phone Group may have as of the date hereof as a subsidiary, affiliate,\ndivision or department of IDT prior to the date hereof under any policy of\ninsurance issued to IDT by any insurance carrier unaffiliated with IDT or under\nany agreements related to such policies executed and delivered prior to the date\nhereof, including any rights such member of the Net2Phone Group may have, as an\ninsured or additional named insured, subsidiary, affiliate, division or\ndepartment, to avail itself of any such policy of insurance or any such\nagreements related to such policies as in effect prior to the date hereof. At\nthe request of Net2Phone, IDT shall take all reasonable steps, including the\nexecution and delivery of any instruments, to effect the foregoing; provided,\nhowever that IDT shall not be required to pay any amounts, waive any rights or\nincur any Liabilities in connection therewith.\n\n                                       13\n\n\n \n     (ii) Except as otherwise contemplated by any Ancillary Agreement, after the\ndate hereof, none of IDT or Net2Phone or any member of their respective Groups\nshall, without the consent of the other, provide any such insurance carrier with\na release, or amend, modify or waive any rights under any such policy or\nagreement, if such release, amendment, modification or waiver would adversely\naffect any rights or potential rights of any member of the other Group\nthereunder; provided however that the foregoing shall not (A) preclude any\nmember of any Group from presenting any claim or from exhausting any policy\nlimit, (B) require any member of any Group to pay any premium or other amount or\nto incur any Liability, or (C) require any member of any Group to renew, extend\nor continue any policy in force. Each of Net2Phone and IDT will share such\ninformation as is reasonably necessary in order to permit the other to manage\nand conduct its insurance matters in an orderly fashion.\n\n     (c) This Agreement shall not be considered as an attempted assignment of\nany policy of insurance or as a contract of insurance and shall not be construed\nto waive any right or remedy of any member of the IDT Group in respect of any\nInsurance Policy or any other contract or policy of insurance.\n\n     (d) Net2Phone does hereby, for itself and each other member of the\nNet2Phone Group, agree that no member of the IDT Group or any IDT Indemnitee\nshall have any Liability whatsoever as a result of the insurance policies and\npractices of IDT and its Affiliates as in effect at any time prior to the date\nhereof, including as a result of the level or scope of any such insurance, the\ncreditworthiness of any insurance carrier, the terms and conditions of any\npolicy, the adequacy or timeliness of any notice to any insurance carrier with\nrespect to any claim or potential claim or otherwise.\n\n     (e) Nothing in this Agreement shall be deemed to restrict any member of the\nNet2Phone Group from acquiring at its own expense any other insurance policy in\nrespect of any Liabilities or covering any period.\n\n     6.2.  CERTAIN BUSINESS MATTERS. (a) Except as may be expressly set forth in\nSection 6.3 below or in any Ancillary Agreement, no member of any Group shall\nhave any duty to refrain from (i) engaging in the same or similar activities or\nlines of business as any member of any other Group, (ii) doing business with any\npotential or actual supplier or customer of any member of any other Group, or\n(iii) engaging in, or refraining from, any other activities whatsoever relating\nto any of the potential or actual suppliers or customers of any member of any\nother Group.\n\n     (b) Each of IDT and Net2Phone is aware that from time to time certain\nbusiness opportunities may arise which more than one Group may be financially\nable to undertake, and which are, from their nature, in the line of more than\none Group's business and are of practical advantage to more than one Group. In\nconnection therewith, the parties agree that if, following the date hereof, any\nof IDT or Net2Phone acquires knowledge of an opportunity that meets the\nforegoing standard with respect to more than one Group, none of the IDT Group or\nthe Net2Phone Group shall have any duty to communicate or offer such opportunity\nto any of the others and may pursue or acquire such opportunity for itself, or\ndirect such opportunity to any other Person.\n\n                                       14\n\n\n \n     6.3.  NON-COMPETITION.\n\n     (a) IDT acknowledges that as the Parent of Net2Phone it and its Affiliates\nhave become privy to certain confidential information and trade secrets of\nNet2Phone and further acknowledges that it will derive substantial benefits from\nthe separation of IDT and Net2Phone and that purchasers of equity of Net2Phone\nwill be making substantial investments in reliance upon the agreement contained\nin this Section 6.3 that the knowledge and expertise developed by Net2Phone and\navailable to IDT will be preserved and will not be used in competition with\nNet2Phone. IDT hereby agrees that it is reasonable and necessary for the\nprotection of Net2Phone that it agree, and accordingly IDT hereby does agree\nthat, for a period of 36 months from the date hereof (the \"Noncompetition\nPeriod\"), neither IDT nor any member of the IDT Group will directly or\nindirectly, alone or in association with any other person, corporation, firm or\nbusiness, engage in the Net2Phone Business any where in the world or become a\nstockholder, partner or owner of any other person, corporation, firm or business\nthat is primarily engaged in the Net2Phone Business any where in the world;\nprovided, however, that subject to Net2Phone's prior approval which shall not be\n-----------------                                                               \nunreasonably withheld, IDT or a member of the IDT Group may acquire a passive\ninvestment of up to 20% of another entity so long as IDT or such member of the\nIDT Group does not assist that entity in developing an Internet telephony\nbusiness or otherwise engaging in the Net2Phone Business.\n\n     (b) For a period of 36 months from the date hereof, neither IDT nor\nNet2Phone, nor any member of either such party's affiliated group, shall,\nwhether for its own account or for the account of any other person, corporation,\nfirm or business (other than Net2Phone or its Affiliates), solicit or endeavor\nto entice away from the other party, or otherwise interfere with the\nrelationship of such other party with, any person who or which is employed on\nthe date hereof by, or otherwise engaged to perform services for, the other\nparty (including, but not limited to, any independent contractors or\norganizations), except to the extent that such other party agrees to release\nsuch employee or other service provider to the other party or such other party's\naffiliated group.  General advertising for employment positions or general\nemployment searches through a third party recruiter are not covered by this\nSection 6.3(b).\n\n     (c) IDT expressly agrees that the covenants contained in Section 6.3(a) and\nSection 6.3(b) are reasonable and necessary for the protection of Net2Phone.\nThe provisions of such Section 6.3(a) and Section 6.3(b) are separate and\ndistinct commitments independent of each of the other provisions of such\nSections.  The invalidity or non-enforceability of this Section 6.3 in any\nrespect shall not affect the validity or enforceability of this Section 6.3 in\nany other respect or of any other provisions of this Agreement. In the event\nthat any provision of this Section 6.3 shall be held invalid or unenforceable by\na court of competent jurisdiction by reason of the geographic or business scope\nor the duration thereof, such invalidity or unenforceability shall attach only\nto the scope or duration of such provision and shall not affect or render\ninvalid or unenforceable any other provision of this Agreement, and, to the\nfullest extent permitted by law, this Agreement shall be construed as if the\ngeographic or business scope or the duration of such provision had been more\nnarrowly drafted so as not to be \n\n                                       15\n\n\n \ninvalid or unenforceable.\n\n     (d) IDT acknowledges that Net2Phone would suffer irreparable harm if IDT\nwere to breach the provisions of this Section 6.3 and that Net2Phone's remedy at\nlaw for any such breach is and will be insufficient and inadequate and that\nNet2Phone shall be entitled to equitable relief, including by way of temporary\nand permanent injunction, in addition to any remedies Net2Phone may have at law.\n\n     6.4.  LATE PAYMENTS.  Except as expressly provided to the contrary in this\nAgreement or in any Ancillary Agreement, any amount not paid when due pursuant\nto this Agreement, any Ancillary Agreement or the Tax Agreement shall accrue\ninterest at a rate per annum equal to the Prime Rate plus 2% commencing upon the\nlater of the (a) due date of such amount and (b) thirtieth day following such\namount being invoiced or otherwise demanded in writing.\n\n\n                                  ARTICLE VII\n                    EXCHANGE OF INFORMATION; CONFIDENTIALITY\n\n     7.1.  AGREEMENT FOR EXCHANGE OF INFORMATION; ARCHIVES. (a) Each of IDT and\nNet2Phone, on behalf of its respective Group, agrees to provide, or cause to be\nprovided, to the other Group, as soon as reasonably practicable after written\nrequest therefor, any Information in the possession or under the control of such\nGroup which the requesting party reasonably needs (i) to comply with reporting,\ndisclosure, filing or other requirements imposed on the requesting party\n(including under applicable securities or tax laws) by a Governmental Authority\nhaving jurisdiction over the requesting party, (ii) for use in any other\njudicial, regulatory, administrative, tax or other proceeding or in order to\nsatisfy audit, accounting, claims, regulatory, litigation, tax or other similar\nrequirements, or (iii) to comply with its obligations under this Agreement or\nany Ancillary Agreement; provided, however, that in the event that any party\ndetermines that any such provision of Information could be commercially\ndetrimental, violate any law or agreement, or waive any attorney client\nprivilege, the parties shall take all reasonable measures to permit the\ncompliance with such obligations in a manner that avoids any such harm or\nconsequence.\n\n     (b) Net2Phone shall have access during regular business hours (as in effect\nfrom time to time) to the documents and objects of historic significance that\nrelate to the business of Net2Phone that are located in the IDT Records to the\nextent such documents or objects have been specifically identified and requested\nby Net2Phone in advance or, if specific documents or objects have not been\nidentified, to the extent Net2Phone has provided IDT with proper advance notice\nto request such access and the Net2Phone representative designated to receive\nsuch access is accompanied by an IDT representative.  Net2Phone may obtain\ncopies (but not originals) of documents for bona fide business purposes and may\nobtain objects for exhibition purposes for commercially reasonable periods of\ntime if required for bona fide business purposes, provided that Net2Phone shall\ncause any such objects to be returned promptly in the same condition in which\nthey were delivered to Net2Phone and Net2Phone shall comply with any rules,\n\n                                       16\n\n\n \nprocedures or other requirements, and shall be subject to any restrictions\n(including prohibitions on removal of specified objects), that are then\napplicable to IDT.  Nothing herein shall be deemed to restrict the access of any\nmember of the IDT Group to any such documents or objects or to impose any\nliability on any member of the IDT Group if any such documents or objects are\nnot maintained or preserved by IDT.\n\n     (c) After the date hereof, (i) Net2Phone shall maintain in effect at its\nown cost and expense adequate systems and controls to the extent necessary to\nenable the members of the IDT Group to satisfy their respective reporting,\naccounting, audit and other obligations, and (ii) Net2Phone shall in a timely\nmanner provide, or cause to be provided, to IDT in such form as IDT shall\nrequest, at no charge to IDT, all financial and other data and information as\nIDT determines necessary or advisable in order to prepare IDT financial\nstatements and reports or filings with any Governmental Authority.\n\n     7.2.  OWNERSHIP OF INFORMATION.  Any Information owned by one Group that is\nprovided to a requesting party pursuant to Section 7.1 shall be deemed to remain\nthe property of the providing party.  Unless specifically set forth herein,\nnothing contained in this Agreement shall be construed as granting or conferring\nrights of license or otherwise in any such Information.\n\n     7.3.  COMPENSATION FOR PROVIDING INFORMATION.  The party requesting such\nInformation agrees to reimburse the other party for the reasonable costs, if\nany, of creating, gathering and copying such Information, to the extent that\nsuch costs are incurred for the benefit of the requesting party.  Except as may\nbe otherwise specifically provided elsewhere in this Agreement or in any other\nagreement between the parties, such costs shall be computed in accordance with\nthe providing party's standard methodology and procedures.\n\n     7.4.  RECORD RETENTION. To facilitate the possible exchange of Information\npursuant to this Article VII and other provisions of this Agreement after the\ndate hereof, the parties agree to use their reasonable best efforts to retain\nall Information in their respective possession or control on the date hereof in\naccordance with the policies of IDT as in effect on the date hereof.  No party\nwill destroy, or permit any of its Subsidiaries to destroy, any Information\nwhich the other party may have the right to obtain pursuant to this Agreement\nprior to the third anniversary of the date hereof without first using its\nreasonable best efforts to notify the other party of the proposed destruction\nand giving the other party the opportunity to take possession of such\ninformation prior to such destruction; provided, however, that in the case of\nany Information relating to Taxes or to Environmental Liabilities, such period\nshall be extended to the expiration of the applicable statute of limitations\n(giving effect to any extensions thereof).\n\n     7.5.  LIMITATION OF LIABILITY.  No party shall have any liability to any\nother party in the event that any Information exchanged or provided pursuant to\nthis Agreement which is an estimate or forecast, or which is based on an\nestimate or forecast, is found to be inaccurate, in the absence of willful\nmisconduct by the party providing such Information.  No party shall have any\nliability to any other party if any Information is destroyed after reasonable\nbest efforts by such party to comply with the provisions of \n\n                                       17\n\n\n \nSection 7.4.\n\n     7.6.  OTHER AGREEMENTS PROVIDING FOR EXCHANGE OF INFORMATION. The rights\nand obligations granted under this Article VII are subject to any specific\nlimitations, qualifications or additional provisions on the sharing, exchange or\nconfidential treatment of Information set forth in any Ancillary Agreement.\n\n     7.7.  PRODUCTION OF WITNESSES; RECORDS; COOPERATION. (a) After the date\nhereof, except in the case of an adversarial Action by one party against another\nparty, each party hereto shall use its reasonable best efforts to make available\nto each other party, upon written request, the former, current and future\ndirectors, officers, employees, other personnel and agents of the members of its\nrespective Group as witnesses and any books, records or other documents within\nits control or which it otherwise has the ability to make available, to the\nextent that any such person (giving consideration to business demands of such\ndirectors, officers, employees, other personnel and agents) or books, records or\nother documents may reasonably be required in connection with any Action in\nwhich the requesting party may from time to time be involved, regardless of\nwhether such Action is a matter with respect to which indemnification may be\nsought hereunder. The requesting party shall bear all costs and expenses in\nconnection therewith.\n\n     (b) If an Indemnifying Party chooses to defend or to seek to compromise or\nsettle any Third Party Claim, the other parties shall make available to such\nIndemnifying Party or such other party, as the case may be, upon written\nrequest, the former, current and future directors, officers, employees, other\npersonnel and agents of the members of its respective Group as witnesses and any\nbooks, records or other documents within its control or which it otherwise has\nthe ability to make available, to the extent that any such person (giving\nconsideration to business demands of such directors, officers, employees, other\npersonnel and agents) or books, records or other documents may reasonably be\nrequired in connection with such defense, settlement or compromise, or such\nprosecution, evaluation or pursuit, as the case may be, and shall otherwise\ncooperate in such defense, settlement or compromise, or such prosecution,\nevaluation or pursuit, as the case may be.\n\n     (c) Without limiting the foregoing, the parties shall cooperate and consult\nto the extent reasonably necessary with respect to any Actions.\n\n     (d) Without limiting any provision of this Section, each of the parties\nagrees to cooperate, and to cause each member of its respective Group to\ncooperate, with each other in the defense of any infringement or similar claim\nwith respect to any intellectual property and shall not claim to acknowledge, or\npermit any member of its respective Group to claim to acknowledge, the validity\nor infringing use of any intellectual property of a third Person in a manner\nthat would hamper or undermine the defense of such infringement or similar\nclaim.\n\n     (e) The obligation of the parties to provide witnesses pursuant to this\nSection 7.7 is intended to be interpreted in a manner so as to facilitate\ncooperation and shall include the obligation to provide as witnesses inventors\nand other officers without regard \n\n                                       18\n\n\n \nto whether the witness or the employer of the witness could assert a possible\nbusiness conflict (subject to the exception set forth in the first sentence of\nSection 7.7(a)).\n\n     (f) In connection with any matter contemplated by this Section 7.7, the\nparties will enter into a mutually acceptable joint defense agreement so as to\nmaintain to the extent practicable any applicable attorney-client privilege or\nwork product immunity of any member of any Group.\n\n     7.8.  CONFIDENTIALITY.  (a) Subject to Section 7.9, each of IDT and\nNet2Phone, on behalf of itself and each member of its respective Group, agrees\nto hold, and to cause its respective directors, officers, employees, agents,\naccountants, counsel and other advisors and representatives to hold, in strict\nconfidence, with at least the same degree of care that applies to IDT's\nconfidential and proprietary information pursuant to policies in effect as of\nthe date hereof, all Information concerning each such other Group that is either\nin its possession (including Information in its possession prior to either of\nthe date hereof) or furnished by any such other Group or its respective\ndirectors, officers, employees, agents, accountants, counsel and other advisors\nand representatives at any time pursuant to this Agreement, any Ancillary\nAgreement, the Tax Agreement or otherwise, and shall not use any such\nInformation other than for such purposes as shall be expressly permitted\nhereunder or thereunder, except, in each case, to the extent that such\nInformation has been (i) in the public domain through no fault of such party or\nany member of such Group or any of their respective directors, officers,\nemployees, agents, accountants, counsel and other advisors and representatives,\n(ii) later lawfully acquired from other sources by such party (or any member of\nsuch party's Group) which sources are not themselves bound by a confidentiality\nobligation), or (iii) independently generated without reference to any\nproprietary or confidential Information of the other party.\n\n     (b) Each party agrees not to release or disclose, or permit to be released\nor disclosed, any such Information to any other Person, except its directors,\nofficers, employees, agents, accountants, counsel and other advisors and\nrepresentatives who need to know such Information (who shall be advised of their\nobligations hereunder with respect to such Information), except in compliance\nwith Section 7.9.  Without limiting the foregoing, when any Information is no\nlonger needed for the purposes contemplated by this Agreement, any Ancillary\nAgreement, or the Tax Agreement, each party will promptly after request of the\nother party either return to the other party all Information in a tangible form\n(including all copies thereof and all notes, extracts or summaries based\nthereon) or certify to the other party that it has destroyed such Information\n(and such copies thereof and such notes, extracts or summaries based thereon).\n\n     7.9.  PROTECTIVE ARRANGEMENTS.  In the event that any party or any member\nof its Group either determines on the advice of its counsel that it is required\nto disclose any Information pursuant to applicable law or receives any demand\nunder lawful process or from any Governmental Authority to disclose or provide\nInformation of any other party (or any member of any other party's Group) that\nis subject to the confidentiality provisions hereof, such party shall notify the\nother party prior to disclosing or providing such Information and shall\ncooperate at the expense of the requesting party in seeking any reasonable\nprotective arrangements requested by such \n\n                                       19\n\n\n \nother party. Subject to the foregoing, the Person that received such request may\nthereafter disclose or provide Information to the extent required by such law\n(as so advised by counsel) or by lawful process or such Governmental Authority.\n\n                                  ARTICLE VIII\n                        ARBITRATION; DISPUTE RESOLUTION\n\n     8.1.  AGREEMENT TO ARBITRATE.  Except as otherwise specifically provided in\nany Ancillary Agreement, the procedures for discussion, negotiation and\narbitration set forth in this Article VIII shall apply to all disputes,\ncontroversies or claims (whether sounding in contract, tort or otherwise) that\nmay arise out of or relate to, or arise under or in connection with this\nAgreement or any Ancillary Agreement, or the transactions contemplated hereby or\nthereby (including all actions taken in furtherance of the transactions\ncontemplated hereby or thereby on or prior to the date hereof), or the\ncommercial or economic relationship of the parties relating hereto or thereto,\nbetween or among any member of the IDT Group and the Net2Phone Group.  Each\nparty agrees on behalf of itself and each member of its respective Group that\nthe procedures set forth in this Article VIII shall be the sole and exclusive\nremedy in connection with any dispute, controversy or claim relating to any of\nthe foregoing matters and irrevocably waives any right to commence any Action in\nor before any Governmental Authority, except as expressly provided in Sections\n8.7(b) and 8.8 and except to the extent provided under the Arbitration Act in\nthe case of judicial review of arbitration results or awards.  Each party on\nbehalf of itself and each member of its respective Group irrevocably waives any\nright to any trial by jury with respect to any claim, controversy or dispute set\nforth in the first sentence of this Section 8.1.\n\n     8.2.  ESCALATION.  (a) It is the intent of the parties to use their\nrespective reasonable best efforts to resolve expeditiously any dispute,\ncontroversy or claim between or among them with respect to the matters covered\nhereby that may arise from time to time on a mutually acceptable negotiated\nbasis. In furtherance of the foregoing, any party involved in a dispute,\ncontroversy or claim shall deliver a notice (an \"Escalation Notice\") demanding\nan in-person meeting involving representatives of the parties at a senior level\nof management of the parties (or if the parties agree, of the appropriate\nstrategic business unit or division within such entity). A copy of any such\nEscalation Notice shall be given to the Chief Financial Officer, or like officer\nor official, of each party involved in the dispute, controversy or claim (which\ncopy shall state that it is an Escalation Notice pursuant to this Agreement).\nAny agenda, location or procedure for such discussions or negotiations between\nthe parties may be established by the parties from time to time; provided,\nhowever, that the parties shall use their reasonable best efforts to meet within\n30 days of the Escalation Notice.\n\n     (b) The parties may, by mutual consent, retain a mediator to aid the\nparties in their discussions and negotiations by informally providing advice to\nthe parties.  Any opinion expressed by the mediator shall be strictly advisory\nand shall not be binding on the parties, nor shall any opinion expressed by the\nmediator be admissible in any arbitration proceedings. The mediator may be\nchosen from a list of mediators previously selected by the parties or by other\nagreement of the parties.  Costs of the mediation shall \n\n                                       20\n\n\n \nbe borne equally by the parties involved in the matter, except that each party\nshall be responsible for its own expenses. Mediation is not a prerequisite to a\ndemand for arbitration under Section 8.3.\n\n     8.3.  DEMAND FOR ARBITRATION.  (a) At any time after the first to occur of\n(i) the date of the meeting actually held pursuant to the applicable Escalation\nNotice or (ii) 45 days after the delivery of an Escalation Notice (as\napplicable, the \"Arbitration Demand Date\"), any party involved in the dispute,\ncontroversy or claim (regardless of whether such party delivered the Escalation\nNotice) may, unless the Applicable Deadline has occurred, make a written demand\n(the \"Arbitration Demand Notice\") that the dispute be resolved by binding\narbitration, which Arbitration Demand Notice shall be given to the parties to\nthe dispute, controversy or claim in the manner set forth in Section 10.5. In\nthe event that any party shall deliver an Arbitration Demand Notice to another\nparty, such other party may itself deliver an Arbitration Demand Notice to such\nfirst party with respect to any related dispute, controversy or claim with\nrespect to which the Applicable Deadline has not passed without the requirement\nof delivering an Escalation Notice. No party may assert that the failure to\nresolve any matter during any discussions or negotiations, the course of conduct\nduring the discussions or negotiations or the failure to agree on a mutually\nacceptable time, agenda, location or procedures for the meeting, in each case,\nas contemplated by Section 8.2, is a prerequisite to a demand for arbitration\nunder Section 8.3.\n\n     (b) Except as may be expressly provided in any Ancillary Agreement, any\nArbitration Demand Notice may be given until one year and 45 days after the\nlater of the occurrence of the act or event giving rise to the underlying claim\nor the date on which such act or event was, or should have been, in the exercise\nof reasonable due diligence, discovered by the party asserting the claim (as\napplicable and as it may in a particular case be specifically extended by the\nparties in writing, the \"Applicable Deadline\"). Any discussions, negotiations or\nmediations between the parties pursuant to this Agreement or otherwise will not\ntoll the Applicable Deadline unless expressly agreed in writing by the parties.\nEach of the parties agrees on behalf of itself and each member of its Group that\nif an Arbitration Demand Notice with respect to a dispute, controversy or claim\nis not given prior to the expiration of the Applicable Deadline, as between or\namong the parties and the members of their Groups, such dispute, controversy or\nclaim will be barred. Subject to Sections 8.7(b) and 8.8, upon delivery of an\nArbitration Demand Notice pursuant to Section 8.3(a) prior to the Applicable\nDeadline, the dispute, controversy or claim shall be decided by a sole\narbitrator in accordance with the rules set forth in this Article VIII.\n\n     8.4.  ARBITRATORS.  (a) Within 15 days after a valid Arbitration Demand\nNotice is given, the parties involved in the dispute, controversy or claim\nreferenced therein shall attempt to select a sole arbitrator satisfactory to all\nsuch parties.\n\n     (b) In the event that such parties are not able jointly to select a sole\narbitrator within such 15-day period, such parties shall each appoint an\narbitrator within 30 days after delivery of the Arbitration Demand Notice. If\none party appoints an arbitrator within such time period and the other party or\nparties fail to appoint an arbitrator within such time period, the arbitrator\nappointed by the one party shall be the sole arbitrator of the \n\n                                       21\n\n\n \nmatter.\n\n     (c) In the event that a sole arbitrator is not selected pursuant to\nparagraph (a) or (b) above and, instead, two or more arbitrators are selected\npursuant to paragraph (b) above, the two or more arbitrators will, within 30\ndays after the appointment of the later of them to be appointed, select an\nadditional arbitrator who shall act as the sole arbitrator of the dispute. After\nselection of such sole arbitrator, the initial arbitrators shall have no further\nrole with respect to the dispute. In the event that the arbitrators so appointed\ndo not, within 30 days after the appointment of the later of them to be\nappointed, agree on the selection of the sole arbitrator, any party involved in\nsuch dispute may apply to CPR, New York, New York to select the sole arbitrator,\nwhich selection shall be made by such organization within 30 days after such\napplication. Any arbitrator selected pursuant to this paragraph (c) shall be\ndisinterested with respect to any of the parties and the matter and shall be\nreasonably competent in the applicable subject matter.\n\n     (d) The sole arbitrator selected pursuant to paragraph (a), (b) or (c)\nabove will set a time for the hearing of the matter which will commence no later\nthan 90 days after the date of appointment of the sole arbitrator pursuant to\nparagraph (a), (b) or (c) above and which hearing will be no longer than 30 days\n(unless in the judgment of the arbitrator the matter is unusually complex and\nsophisticated and thereby requires a longer time, in which event such hearing\nshall be no longer than 90 days). The final decision of such arbitrator will be\nrendered in writing to the parties not later than 60 days after the last hearing\ndate, unless otherwise agreed by the parties in writing.\n\n     (e) The place of any arbitration hereunder will be New York, New York,\nunless otherwise agreed by the parties.\n\n     8.5.  HEARINGS.  Within the time period specified in Section 8.4(d), the\nmatter shall be presented to the arbitrator at a hearing by means of written\nsubmissions of memoranda and verified witness statements, filed simultaneously,\nand responses, if necessary in the judgment of the arbitrator or both the\nparties. If the arbitrator deems it to be essential to a fair resolution of the\ndispute, live cross-examination or direct examination may be permitted, but is\nnot generally contemplated to be necessary. The arbitrator shall actively manage\nthe arbitration with a view to achieving a just, speedy and cost-effective\nresolution of the dispute, claim or controversy. The arbitrator may, in his or\nher discretion, set time and other limits on the presentation of each party's\ncase, its memoranda or other submissions, and refuse to receive any proffered\nevidence, which the arbitrator, in his or her discretion, finds to be\ncumulative, unnecessary, irrelevant or of low probative nature. Except as\notherwise set forth herein, any arbitration hereunder will be conducted in\naccordance with the CPR Rules for Non-Administered Arbitration of Business\nDisputes then prevailing (except that the arbitration will not be conducted\nunder the auspices of the CPR and the fee schedule of the CPR will not apply).\nExcept as expressly set forth in Section 8.8(b), the decision of the arbitrator\nwill be final and binding on the parties, and judgment thereon may be had and\nwill be enforceable in any court having jurisdiction over the parties.\nArbitration awards will bear interest at an annual rate of the Prime Rate plus\n2% per annum. To the extent that the provisions of this Agreement and the\nprevailing rules of the CPR conflict, the provisions of this Agreement \n\n                                       22\n\n\n \nshall govern.\n\n     8.6.  DISCOVERY AND CERTAIN OTHER MATTERS.  (a) Any party involved in the\napplicable dispute may request limited document production from the other party\nor parties of specific and expressly relevant documents, with the reasonable\nexpenses of the producing party incurred in such production paid by the\nrequesting party. Any such discovery (which rights to documents shall be\nsubstantially less than document discovery rights prevailing under the Federal\nRules of Civil Procedure) shall be conducted expeditiously and shall not cause\nthe hearing provided for in Section 8.5 to be adjourned except upon consent of\nall parties involved in the applicable dispute or upon an extraordinary showing\nof cause demonstrating that such adjournment is necessary to permit discovery\nessential to a party to the proceeding. Depositions, interrogatories or other\nforms of discovery (other than the document production set forth above) shall\nnot occur except by consent of the parties involved in the applicable dispute.\nDisputes concerning the scope of document production and enforcement of the\ndocument production requests will be determined by written agreement of the\nparties involved in the applicable dispute or, failing such agreement, will be\nreferred to the arbitrator for resolution. All discovery requests will be\nsubject to the proprietary rights and rights of privilege of the parties, and\nthe arbitrator will adopt procedures to protect such rights and to maintain the\nconfidential treatment of the arbitration proceedings (except as may be required\nby law). Subject to the foregoing, the arbitrator shall have the power to issue\nsubpoenas to compel the production of documents relevant to the dispute,\ncontroversy or claim.\n\n     (b) The arbitrator shall have full power and authority to determine issues\nof arbitrability but shall otherwise be limited to interpreting or construing\nthe applicable provisions of this Agreement or any Ancillary Agreement, and will\nhave no authority or power to limit, expand, alter, amend, modify, revoke or\nsuspend any condition or provision of this Agreement or any Ancillary Agreement;\nit being understood, however, that the arbitrator will have full authority to\nimplement the provisions of this Agreement or any Ancillary Agreement, and to\nfashion appropriate remedies for breaches of this Agreement (including interim\nor permanent injunctive relief); provided that the arbitrator shall not have (i)\nany authority in excess of the authority a court having jurisdiction over the\nparties and the controversy or dispute would have absent these arbitration\nprovisions or (ii) any right or power to award punitive or treble damages. It is\nthe intention of the parties that in rendering a decision the arbitrator give\neffect to the applicable provisions of this Agreement and the Ancillary\nAgreements and follow applicable law (it being understood and agreed that this\nsentence shall not give rise to a right of judicial review of the arbitrator's\naward).\n\n     (c) If a party fails or refuses to appear at and participate in an\narbitration hearing after due notice, the arbitrator may hear and determine the\ncontroversy upon evidence produced by the appearing party.\n\n     (d) Arbitration costs will be borne equally by each party involved in the\nmatter, except that each party will be responsible for its own attorney's fees\nand other costs and expenses, including the costs of witnesses selected by such\nparty.\n\n                                       23\n\n\n \n     8.7.  CERTAIN ADDITIONAL MATTERS.  (a) Any arbitration award shall be a\nbare award limited to a holding for or against a party and shall be without\nfindings as to facts, issues or conclusions of law (including with respect to\nany matters relating to the validity or infringement of patents or patent\napplications) and shall be without a statement of the reasoning on which the\naward rests, but must be in adequate form so that a judgment of a court may be\nentered thereupon. Judgment upon any arbitration award hereunder may be entered\nin any court having jurisdiction thereof.\n\n     (b) Prior to the time at which an arbitrator is appointed pursuant to\nSection 8.4, any party may seek one or more temporary restraining orders or\npreliminary injunctions in a court of competent jurisdiction if necessary in\norder to preserve and protect the status quo. Neither the request for, or grant\nor denial of, any such temporary restraining order or preliminary injunction\nshall be deemed a waiver of the obligation to arbitrate as set forth herein and\nthe arbitrator may dissolve, continue or modify any such order. Any such\ntemporary restraining order or preliminary injunction shall remain in effect\nuntil the first to occur of the expiration of the order in accordance with its\nterms or the dissolution thereof by the arbitrator.\n\n     (c) Except as required by law, the parties shall hold, and shall cause\ntheir respective officers, directors, employees, agents and other\nrepresentatives to hold, the existence, content and result of mediation or\narbitration in confidence in accordance with the provisions of Article VIII and\nexcept as may be required in order to enforce any award. Each of the parties\nshall request that any mediator or arbitrator comply with such confidentiality\nrequirement.\n\n     (d) In the event that at any time the sole arbitrator shall fail to serve\nas an arbitrator for any reason, the parties shall select a new arbitrator who\nshall be disinterested as to the parties and the matter in accordance with the\nprocedures set forth herein for the selection of the initial arbitrator. The\nextent, if any, to which testimony previously given shall be repeated or as to\nwhich the replacement arbitrator elects to rely on the stenographic record (if\nthere is one) of such testimony shall be determined by the replacement\narbitrator.\n\n     8.8.  LIMITED COURT ACTIONS.  (a) Notwithstanding anything herein to the\ncontrary, in the event that any party reasonably determines the amount in\ncontroversy in any dispute, controversy or claim (or any series of related\ndisputes, controversies or claims) under this Agreement or any Ancillary\nAgreement is, or is reasonably likely to be, in excess of $5 million and if such\nparty desires to commence an Action in lieu of complying with the arbitration\nprovisions of this Article, such party shall so state in its Arbitration Demand\nNotice. If the other parties to the arbitration do not agree that the amount in\ncontroversy in such dispute, controversy or claim (or such series of related\ndisputes, controversies or claims) is, or is reasonably likely to be, in excess\nof $5 million, the arbitrator selected pursuant to Section 8.4 hereof shall\ndecide whether the amount in controversy in such dispute, controversy or claim\n(or such series of related disputes, controversies or claims) is, or is\nreasonably likely to be, in excess of $5 million. The arbitrator shall set a\ndate that is no later than ten days after the date of his or her appointment for\nsubmissions by the parties with respect to such issue. There shall not be \n\n                                       24\n\n\n \nany discovery in connection with such issue. The arbitrator shall render his or\nher decision on such issue within five days of such date so set by the\narbitrator. In the event that the arbitrator determines that the amount in\ncontroversy in such dispute, controversy or claim (or such series of related\ndisputes, controversies or claims) is or is reasonably likely to be in excess of\n$5 million, the provisions of Sections 8.4(d) and (e), 8.5, 8.6, 8.7 and 8.10\nhereof shall not apply and on or before (but, except as expressly set forth in\nSection 8.8(b), not after) the tenth business day after the date of such\ndecision, any party to the arbitration may elect, in lieu of arbitration, to\ncommence an Action with respect to such dispute, controversy or claim (or such\nseries of related disputes, controversies or claims) in any court of competent\njurisdiction. If the arbitrator does not so determine, the provisions of this\nArticle (including with respect to time periods) shall apply as if no\ndeterminations were sought or made pursuant to this Section 8.8(a).\n\n     (b) In the event that an arbitration award in excess of $5 million is\nissued in any arbitration proceeding commenced hereunder, any party may, within\n60 days after the date of such award, submit the dispute, controversy or claim\n(or series of related disputes, controversies or claims) giving rise thereto to\na court of competent jurisdiction, regardless of whether such party or any other\nparty sought to commence an Action in lieu of proceeding with arbitration in\naccordance with Section 8.8(a). In such event, the applicable court may elect to\nrely on the record developed in the arbitration or, if it determines that it\nwould be advisable in connection with the matter, allow the parties to seek\nadditional discovery or to present additional evidence. Each party shall be\nentitled to present arguments to the court with respect to whether any such\nadditional discovery or evidence shall be permitted and with respect to all\nother matters relating to the applicable dispute, controversy or claim (or\nseries of related disputes, controversies or claims).\n\n     8.9.  CONTINUITY OF SERVICE AND PERFORMANCE.  Unless otherwise agreed in\nwriting, the parties will continue to provide service and honor all other\ncommitments under this Agreement and each Ancillary Agreement during the course\nof dispute resolution pursuant to the provisions of this Article VIII with\nrespect to all matters not subject to such dispute, controversy or claim.\n\n     8.10. LAW GOVERNING ARBITRATION PROCEDURES.  The interpretation of the\nprovisions of this Article VIII, only insofar as they relate to the agreement to\narbitrate and any procedures pursuant thereto, shall be governed by the\nArbitration Act and other applicable federal law. In all other respects, the\ninterpretation of this Agreement shall be governed as set forth in Section 10.2.\n\n\n                                   ARTICLE IX\n                  FURTHER ASSURANCES AND ADDITIONAL COVENANTS\n\n     9.1.  FURTHER ASSURANCES. (a) In addition to the actions specifically\nprovided for elsewhere in this Agreement, each of the parties hereto shall use\nits reasonable best effort to take, or cause to be taken, all actions, and to\ndo, or cause to be done, all things reasonably necessary, proper or advisable\nunder applicable laws, regulations and agreements to consummate and make\neffective the transactions \n\n                                       25\n\n\n \ncontemplated by this Agreement, the Ancillary Agreements and the Tax Agreement.\n\n     (b) Without limiting the foregoing, each party hereto shall cooperate with\nthe other parties, and without any further consideration, but at the expense of\nthe requesting party, to execute and deliver, or use its reasonable best efforts\nto cause to be executed and delivered, all instruments, including instruments of\nconveyance, assignment and transfer, and to make all filings with, and to obtain\nall consents, approvals or authorizations of, any Governmental Authority or any\nother Person under any permit, license, agreement, indenture or other instrument\nand to take all such other actions as such party may reasonably be requested to\ntake by any other party hereto from time to time, consistent with the terms of\nthis Agreement and the Ancillary Agreements, in order to effectuate the\nprovisions and purposes of this Agreement and the Ancillary Agreements and the\nother transactions contemplated hereby and thereby. Without limiting the\nforegoing, to the extent necessary to effectuate the provisions and purposes of\nthis Agreement and the Ancillary Agreements and the other transactions\ncontemplated hereby and thereby each party will, at the reasonable request, cost\nand expense of any other party, take such other actions as may be reasonably\nnecessary to vest in such other party good and marketable title, free and clear\nof any Security Interest, if and to the extent it is practicable to do so.\n\n     (c) IDT and Net2Phone, and each of the members of their respective Groups,\nwaive (and agree not to assert against any of the others) any claim or demand\nthat any of them may have against any of the others for any Liabilities or other\nclaims relating to or arising out of: (i) the failure of Net2Phone or any member\nof the Net2Phone Group, on the one hand, or of IDT or any member of the IDT\nGroup, on the other hand, to provide any notification or disclosure required\nunder any state Environmental Law in connection with the transactions\ncontemplated by this Agreement, or (ii) any inadequate, incorrect or incomplete\nnotification or disclosure under any such state Environmental Law by the\napplicable transferor.\n\n     (d) Following the date hereof, if one or more of the parties identifies any\ncommercial or other service that is needed to assure a smooth and orderly\ntransition of the businesses in connection with the consummation of the\ntransactions contemplated hereby, and that is not otherwise governed by the\nprovisions of this Agreement or any Ancillary Agreement, the parties will\ncooperate in determining whether there is a mutually acceptable arm's-length\nbasis on which one or more of the other parties will provide such service.\n\n\n\n                                   ARTICLE X\n                                 MISCELLANEOUS\n\n     10.1.  COUNTERPARTS; ENTIRE AGREEMENT; CORPORATE POWER.    \n     (a)    This Agreement may be executed in one or more counterparts, all of\nwhich shall be considered one and the same agreement, and shall become effective\nwhen one or more counterparts have been signed by each of the parties and\ndelivered to the other party.\n\n                                       26\n\n\n \n     (b) This Agreement, and the Exhibits, Schedules and Appendices hereto,\ncontain the entire agreement between the parties with respect to the subject\nmatter hereof, supersede all previous agreements, negotiations, discussions,\nwritings, understandings, commitments and conversations with respect to such\nsubject matter and there are no agreements or understandings between the parties\nother than those set forth or referred to herein or therein.\n\n     (c) IDT represents on behalf of itself and each other member of the IDT\nGroup and Net2Phone represents on behalf of itself and each other member of the\nNet2Phone Group as follows:\n\n       (i) each such Person has the requisite corporate or other power and\nauthority and has taken all corporate or other action necessary in order to\nexecute, deliver and perform each of this Agreement, each of the Ancillary\nAgreements and the Tax Agreement to which it is a party and to consummate the\ntransactions contemplated hereby and thereby; and\n\n       (ii) this Agreement, each Ancillary Agreement and the Tax Agreement to\nwhich it is a party has been duly executed and delivered by it and constitutes a\nvalid and binding agreement of it enforceable in accordance with the terms\nthereof subject to (a) the laws of bankruptcy and laws effecting creditors'\nrights generally and (b) the availability of equitable remedies.\n\n     10.2.  GOVERNING LAW.  Except as set forth in Section 8.10, this Agreement\nshall be governed by and construed and interpreted in accordance with the laws\nof the State of New York (other than as to its laws of arbitration which shall\nbe governed under the Arbitration Act or other applicable federal law pursuant\nto Section 8.10), irrespective of the choice of laws principles of the State of\nNew York, as to all matters, including matters of validity, construction,\neffect, enforceability, performance and remedies.\n\n     10.3.  ASSIGNABILITY.  Except as set forth in any Ancillary Agreement or\nthe Tax Agreement, this Agreement (including without limitation the provisions\nof Section 6.3 hereof), each Ancillary Agreement and the Tax Agreement shall be\nbinding upon and inure to the benefit of the parties hereto and thereto,\nrespectively, and their respective successors and assigns (whether by merger,\noperation of law or otherwise); provided, however, that no party hereto or\nthereto may assign its respective rights or delegate its respective obligations\nunder this Agreement, any Ancillary Agreement or the Tax Agreement without the\nexpress prior written consent of the other parties hereto or thereto.\n\n     10.4.  THIRD PARTY BENEFICIARIES.  Except for the indemnification rights\nunder this Agreement of any IDT Indemnitee or Net2Phone Indemnitee in their\nrespective capacities as such, (a) the provisions of this Agreement, each\nAncillary Agreement and the Tax Agreement are solely for the benefit of the\nparties and are not intended to confer upon any Person except the parties any\nrights or remedies hereunder, and (b) there are no third party beneficiaries of\nthis Agreement, any Ancillary Agreement or the Tax Agreement and none of this\nAgreement, any Ancillary Agreement or the Tax Agreement shall provide any third\nperson with any remedy, claim, liability, \n\n                                       27\n\n\n \nreimbursement, claim of action or other right in excess of those existing\nwithout reference to this Agreement, any Ancillary Agreement or the Tax\nAgreement. No party hereto shall have any right, remedy or claim with respect to\nany provision of this Agreement, any Ancillary Agreement or the Tax Agreement to\nthe extent such provision relates solely to the other two parties hereto or the\nmembers of such other two parties' respective Groups.\n\n     10.5.  NOTICES.  All notices requests, demands, waivers and other\ncommunications under this Agreement, any Ancillary Agreement or the Tax\nAgreement shall be in writing and shall be deemed to have been duly given if\ndelivered personally or by facsimile transmission or mailed (certified or\nregistered mail, postage prepaid, return receipt requested):\n\n         If to IDT, to:    IDT Corporation\n                           190 Main Street\n                           Hackensack, New Jersey  07601\n                           Attention:  Chief Financial Officer\n                           Fax No.:  (201) 907-5165\n\n         If to Net2Phone:  Net2Phone, Inc.\n                           171 Main Street\n                           Hackensack, New Jersey  07601\n                           Attention:  Chief Financial Officer\n                           Fax No.:  (201) 907-5351\n\nor to such other person or address as any party shall specify by notice in\nwriting to the other party.  All such notices, requests, demands, waivers and\ncommunications shall be deemed to have been received on the date on which hand\ndelivered, upon transmission of the facsimile transmission by the sender and\nissuance by the transmitting machine of a confirmation slip confirming that the\nnumber of pages constituting the notice have been transmitted without error, or\non the third business day following the date on which so mailed, except for a\nnotice of change of address, which shall be effective only upon receipt thereof.\nIn the case of a notice sent by facsimile transmission, the sender shall\ncontemporaneously mail a copy of the notice to the addressee at the address\nprovided for above.  However, such mailing shall in no way alter the time at\nwhich the facsimile notice is deemed received.  In no event shall the provision\nof notice pursuant to this Section 10.5 constitute notice for service of\nprocess.\n\n     10.6.  SEVERABILITY.  If any provision of this Agreement, any Ancillary\nAgreement or the Tax Agreement or the application thereof to any Person or\ncircumstance is determined by a court of competent jurisdiction to be invalid,\nvoid or unenforceable, the remaining provisions hereof or thereof, or the\napplication of such provision to Persons or circumstances or in jurisdictions\nother than those as to which it has been held invalid or unenforceable, shall\nremain in full force and effect and shall in no way be affected, impaired or\ninvalidated thereby, so long as the economic or legal substance of the\ntransactions contemplated hereby or thereby, as the case may be, is not affected\nin any manner adverse to any party. Upon such determination, the parties shall\n\n                                       28\n\n\n \nnegotiate in good faith in an effort to agree upon such a suitable and equitable\nprovision to effect the original intent of the parties.\n\n     10.7.  FORCE MAJEURE.  No party shall be deemed in default of this\nAgreement, any Ancillary Agreement or the Tax Agreement to the extent that any\ndelay or failure in the performance of its obligations under this Agreement, any\nAncillary Agreement or the Tax Agreement results from any cause beyond its\nreasonable control and without its fault or negligence, such as acts of God,\nacts of civil or military authority, embargoes, epidemics, war, riots,\ninsurrections, fires, explosions, earthquakes, floods, unusually severe weather\nconditions, labor problems or unavailability of parts, or, in the case of\ncomputer systems, any failure in electrical or air conditioning equipment. In\nthe event of any such excused delay, the time for performance shall be extended\nfor a period equal to the time lost by reason of the delay.\n\n     10.8.  PUBLICITY.  Each of Net2Phone and IDT shall consult with each other\nprior to issuing any press releases or otherwise making public statements with\nrespect to the other transactions contemplated hereby and prior to making any\nfilings with any Governmental Authority with respect thereto.\n\n     10.9.  HEADINGS.  The article, section and paragraph headings contained in\nthis Agreement and in the Ancillary Agreements and the Tax Agreement are for\nreference purposes only and shall not affect in any way the meaning or\ninterpretation of this Agreement, any Ancillary Agreement or the Tax Agreement.\n\n     10.10.  SURVIVAL OF COVENANTS.  Except as expressly set forth in any\nAncillary Agreement and the Tax Agreement, the covenants, representations and\nwarranties contained in this Agreement, each Ancillary Agreement and the Tax\nAgreement, and liability for the breach of any obligations contained herein,\nshall survive the delivery hereof.\n\n     10.11.  WAIVERS OF DEFAULT.  Waiver by any party of any default by the\nother party of any provision of this Agreement, any Ancillary Agreement or the\nTax Agreement shall not be deemed a waiver by the waiving party of any\nsubsequent or other default, nor shall it prejudice the rights of the other\nparty.\n\n     10.12.  SPECIFIC PERFORMANCE.  In the event of any actual or threatened\ndefault in, or breach of, any of the terms, conditions and provisions of this\nAgreement, any Ancillary Agreement or the Tax Agreement, the party or parties\nwho are or are to be thereby aggrieved shall have the right to specific\nperformance and injunctive or other equitable relief of its rights under this\nAgreement, such Ancillary Agreement or the Tax Agreement, in addition to any and\nall other rights and remedies at law or in equity, and all such rights and\nremedies shall be cumulative. The parties agree that the remedies at law for any\nbreach or threatened breach, including monetary damages, are inadequate\ncompensation for any loss and that any defense in any action for specific\nperformance that a remedy at law would be adequate is waived. Any requirements\nfor the securing or posting of any bond with such remedy are waived.\n\n                                       29\n\n\n \n     10.13.  AMENDMENTS.  No provisions of this Agreement, any Ancillary\nAgreement or the Tax Agreement shall be deemed waived, amended, supplemented or\nmodified by any party, unless such waiver, amendment, supplement or modification\nis in writing and signed by the authorized representative of the party against\nwhom it is sought to enforce such waiver, amendment, supplement or modification.\n\n     10.14.  INTERPRETATION.  Words in the singular shall be held to include the\nplural and vice versa and words of one gender shall be held to include the other\ngenders as the context requires. The terms \"hereof,\" \"herein,\" and \"herewith\"\nand words of similar import shall, unless otherwise stated, be construed to\nrefer to this Agreement (or the applicable Ancillary Agreement or the Tax\nAgreement) as a whole (including all of the Schedules, Exhibits and Appendices\nhereto and thereto) and not to any particular provision of this Agreement (or\nsuch Ancillary Agreement or the Tax Agreement). Article, Section, Exhibit,\nSchedule and Appendix references are to the Articles, Sections, Exhibits,\nSchedules and Appendices to this Agreement (or the applicable Ancillary\nAgreement or the Tax Agreement) unless otherwise specified. The word \"including\"\nand words of similar import when used in this Agreement (or the applicable\nAncillary Agreement or the Tax Agreement) shall mean \"including, without\nlimitation,\" unless the context otherwise requires or unless otherwise\nspecified.\n\n                                       30\n\n\n \n     IN WITNESS WHEREOF, the parties have caused this Separation Agreement to be\nexecuted by their duly authorized representatives as of the date first above\nwritten.\n\n                              IDT CORPORATION\n\n                              By: \/s\/ Hal Brecher\n                                 --------------------------------\n                              Name:  Hal Brecher\n                              Title:  Chief Operating Officer\n\n\n                              NET2PHONE, INC.\n\n                              By: \/s\/ Howard Balter\n                                 --------------------------------\n                              Name: Howard Balter\n                              Title: Chief Executive Officer\n\n                                       31\n\n<\/pre>\n","protected":false},"template":"","meta":{"_acf_changed":false,"_stopmodifiedupdate":true,"_modified_date":"","_cloudinary_featured_overwrite":false},"corporate_contracts_companies":[7828,8319],"corporate_contracts_industries":[9510,9519],"corporate_contracts_types":[9622,9628],"class_list":["post-43587","corporate_contracts","type-corporate_contracts","status-publish","hentry","corporate_contracts_companies-idt-corp","corporate_contracts_companies-net2phone-inc","corporate_contracts_industries-technology__programming","corporate_contracts_industries-telecommunications__telephone","corporate_contracts_types-planning","corporate_contracts_types-planning__separation"],"acf":[],"_links":{"self":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts\/43587","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts"}],"about":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/types\/corporate_contracts"}],"wp:attachment":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/media?parent=43587"}],"wp:term":[{"taxonomy":"corporate_contracts_companies","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_companies?post=43587"},{"taxonomy":"corporate_contracts_industries","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_industries?post=43587"},{"taxonomy":"corporate_contracts_types","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_types?post=43587"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}