Exhibit 10.58
 
Mr. Charles H.F. Garner
125 East 72nd Street
New York, NY 10021
 
April 22, 2002

 
Dear Charles:
 
This letter outlines the agreement that we have reached concerning your
separation of employment from IDT Corporation (“IDT” or the “Corporation”), and
its subsidiaries and affiliates of March 18, 2002.
 

 
1.
 
As of the close of business on March 4, 2002 (the “Separation Date”), you no
longer have any work responsibilities at IDT and do not have (and will not
represent that you have) any authority to act on behalf of IDT or to bind the
Corporation or any of its subsidiaries or affiliates in any fashion: Concurrent
with your execution of this Agreement, you shall execute and deliver your formal
resignation as an executive officer and/or director of IDT, IDT Ventures, Inc.
and Winstar Holdings, LLC and its subsidiaries.

 

 
2.
 
All options to purchase shares of common or Class B common stock of IDT
presently held by you shall vest immediately. The following table confirms the
outstanding options presently held by you:

 
Grant
Number
  
Class of Stock
  
Number of
Options Granted
 
Exercise Price
96-534
  
Common
  
50,000
 
$10.34375
96-534
  
Class B Common
  
50,000
 
$10.34375
96B326
  
Class B Common
  
160,000
 
$8.8515
12/01
  
Class B Common
  
50,000
 
$12.06

 

 
    
 
Such options may be sold by you for a period of five (5) years at any time to
time in accordance with applicable law. Such options shall terminate on March
17, 2007.

 

 
3.
 
The options to purchase 100,000 shares of the low vote common stock of IDT
Telecom. Inc. (“IDTT”) which were granted to you on August 1, 2001 shall vest
immediately. Such options will become exercisable on the occurrence of an
Initial Public Offering of IDT stock and shall remain exercisable for a period
of three years from such date after which time the options will terminate. In
the event, however, that such options shall be redeemed or otherwise modified by

--------------------------------------------------------------------------------

 
IDTT, your options shall be treated in the same manner as the options held by
senior executives of IDTT.

 

 
4.
 
IDT shall make a loan to you of $1,000,000, which shall accrue simple interest
at the rate equal to the lowest rate permissible under applicable law without
incurring additional tax obligations. Where principal of such loan is repaid
(but not until then), such interest shall be payable (to the extent then
accrued) on the amount so repaid. Such loan shall be secured by the IDTT options
held by you and shall (other than the security interest in such options) be
non-recourse to you personally or any of your assets. Such loan shall be repaid
with any cash proceeds received by you from time to time from the exercise of
your IDTT options and sale of the underlying shares.

 

 
    
 
In the event you do not exercise any of your IDTT options by the dates specified
below, the unpaid portion equal to one-third (1/3) of the principal of the loan
(together with any accrued interest thereon) shall be forgiven and a
corresponding one-third (1/3) of your IDTT options shall be released as security
for the loan and cancelled.

 
Date

--------------------------------------------------------------------------------

 
Loan Amount to
be Forgiven

--------------------------------------------------------------------------------

 
Percentage of Loan

--------------------------------------------------------------------------------

4/1/03
 
$333,000
 
33 1/3%
4/1/04
 
$333,000
 
33 1/3%
4/1/05
 
$334,000
 
33 1/3%

 

 
    
 
Notwithstanding anything to the contrary herein, the forgiveness of the loan
shall not occur until IDT receives funds representing the full amount necessary
to pay all applicable federal, state and local taxes and any other withholding
required by law upon such forgiveness. Immediately upon the loan obligations
being Forgiven by IDT, any security for the loan obligations shall become
unencumbered and shall be released from security for the loan obligations.

 

 
5.
 
Notwithstanding any prior agreements or promises, we shall have no obligation to
provide to you any equity interests or options in Net2Phone, Inc. or Winstar
Holdings, LLC or any of their subsidiaries or affiliates.

 

 
6.
 
The loan previously made to you in the aggregate principal amount of $300,000
shall be forgiven on and as of the date hereof.

 

 
7.
 
IDT shall provide you with the following additional benefits:

 
Bonuses:
 
Any unpaid portion of bonuses previously awarded to you will be paid when and if
such bonuses are paid to other senior executives of IDTT. As of the date hereof,
no such

-2-

--------------------------------------------------------------------------------

    
bonuses remain payable to you.
Health Insurance:
  
If you are not enrolled in another group health plan on the Separation Date, you
will be entitled, as of that date to elect COBRA continuation coverage for a
period of 18 months or until you become covered by another group health plaza,
whichever occurs sooner, IDT will pay all premiums through 12/31/02 (or such
earlier date upon which you notify us that you have obtained alternate insurance
through an employer). Thereafter, you shall be solely responsible for payment of
all medical insurance premiums.
Charitable Contributions
  
We shall make available to you the right to designate up to $50,000 in
charitable contributions from the IDT Charitable Foundation through 12/31/03 for
charitable purposes only.
Life Insurance:
  
IDT shall pay all premiums from time to time due on the $1,000,000 split premium
life insurance policy recently provided to you by IDT.
Office:
  
You shall have use of a private office, secretarial staff (which shall not be
dedicated exclusively to you) and your existing IDT e-mail address through
12/31/02.
Litigation:
  
In the event that you are at any time and from time to time required to provide
testimony or participate in depositions, litigation, investigations, etc.
relating to your work for DDT and its subsidiaries; IDT shall compensate you for
your time preparing for and participating therein at the rate of $250 per hour,
plus any actual and documented out-of-pocket costs relating thereto.

 

 
8.
 
You hereby agree that, for a period of two (2) years from the Effective Date of
this Agreement, you shall not become an employee, consultant, corporate officer

-3-

--------------------------------------------------------------------------------

 
or director of, or hold more than a 10% equity interest in, any business that
derives significant revenues from competing with a core business of IDT. For
purposes hereof,(a) the term “significant revenues” shall mean the greater of
$50 million in revenues for the 12 fiscal months then most recently ended and
20% of its revenues for such period, (b) the term “core business of IDT” shall
mean each of (i) the sale on a wholesale basis within the United States of
international carrier minutes and (ii) the sale within the United States of
international prepaid calling cards and (c) any equity interest held in any such
business by your spouse or children shall be deemed to be held by you for
purposes of determining compliance with the 10% limitation described above. You
further agree that for a period of two (2) years from the Effective Date of this
Agreement, you will not,, directly or indirectly, use material non-public
information obtained by you during the course of your employment with IDT to (a)
influence or attempt to influence customers or suppliers of the Corporation, or
any of its subsidiaries or affiliates, to divert their business to any
competitor of the Corporation or in any way to cannel or change their
affiliation, relationship or contracts with the Corporation, or (b) solicit or
recruit an individual who is, or during the two (2) year period referenced
above, an employee, consultant or independent contractor of the Corporation for
the purpose of being employed by you or by a competitor of the Corporation and
that you will not convey any confidential information about the Corporation or
other employees of the Corporation to any other person or competitor of the
Corporation.

 

 
9.
 
You acknowledge that during the course of your employment with IDT you acquired
confidential information regarding the Corporation and its affiliates, including
but not limited to, information regarding each of its product or service plans,
business partners or affiliates, product designs, product costs, product prices,
finances, business models, competitive strategy, existing or prospective
clients, marketing plans, business opportunities, personnel, research and
development activities, know-how, pre-release products or service plans,
computer programs, object code, source code, specifications, flow charts,
process charts and other data and trade secrets (“Confidential Information”).
Any information obtained by you from IDT shall be considered Confidential
information irrespective of the mode of the communication (oral, written or
otherwise). The Confidential Information was established at great expense, is
protected as confidential information and trade secrets and provides IDT with a
substantial competitive advantage of selling its products and services. You
acknowledge that IDT would suffer great loss and injury if you would disclose
this information or use it to compete with the Corporation. You agree to hold
such Confidential Information. in strict confidence and not reveal the same,
except for an information which is: a generally available to or known to the
public; (b) known to you prior to your employment with IDT; (c) independently
developed or obtained by you outside the scope of your employment with IDT; (d)
lawfully received from a third party without any obligation of confidentiality
in favor of IDT; (e) approved in writing for disclosure by IDT; or (f) required
to be disclosed by you pursuant to any legal, judicial or governmental request,

-4-

--------------------------------------------------------------------------------

 
provided that you have previously provided IDT with notice of such request and
cooperated with IDT in any efforts that it might make to oppose such request.
The obligations regarding the Confidential Information shall survive for a
period of two (2) years from the effective Date of This Agreement. All of the
restricted Confidential Information described above shall remain the sole and
exclusive property of IDT.

 

 
10.
 
In consideration of the arrangements described in the preceding paragraphs, you
hereby release and forever discharge IDT and its subsidiaries, affiliates, or
related business entities and their x successors and assigns and any individual
now or previously employed by IDT or its or their subsidiaries, affiliates,
related business entities and its or their present and former officers,
directors, agents, employees, predecessors, successors, assigns and
representatives (whether any of the aforementioned individuals were acting as
agents for IDT, or one of the other entities, or in their individual capacities
except as set forth above), from any and all claims, demands and causes of
action of any kind whatsoever, whether known or unknown, including, but not
limited to, claims related to your employment or separation from employment; any
claims for salary, bonuses (including, without limitation, severance pay,
vacation pay or any benefits under the Employee Retirement Income Security Act
(except for vested ERISA benefits which are not affected by this Agreement); any
claim under New Jersey’s Wage and Hour Laws; any claim alleging sexual or other
harassment, or discrimination based on race, color, national origin, ancestry,
religion, marital status, sex, sexual orientation, citizenship status,
pregnancy, medical condition, handicap or disability (as defined by the
Americans with Disabilities Act or any state or local law), age, or any other
unlawful discrimination (under the Age Discrimination in Employment Act, as
amended by the Older Workers Benefit Protection Act of 1990, Title VII of the
Civil Rights Act of 1964, as amended, the Americans with Disabilities Act, the
Equal Pay Act, the Violence Against Women Act, the New Jersey Law Against
Discrimination, or any other federal, state, or local laws): discharge in
violation of New Jersey’s Conscientious Employee Protection Act or other state
or federal “whistle blower” laws; discharge in violation of the federal Family
and Medical Leave Act, the New Jersey Family Leave Act or other state or federal
family leave laws; breach of implied or express contract, breach of promises,
misrepresentation, negligence, fraud, estoppel, defamation, infliction of
emotional distress, violation of public policy, retaliatory discharge, wrongful
or constructive discharge, retaliation, intentional tort or for attorneys’ fees,
which you, your heirs, executors, administrators, successors, and assigns now
have, ever had or may hereafter have, whether known or unknown, suspected or
unsuspected, from the beginning of the world through and including the Effective
Date of this Agreement. It is understood and agreed that the release herein (a)
is not to be construed as an admission of liability by IDT and (b) shall not
impair any rights otherwise available to you with respect to the breach of this
Agreement or restrict your ability to enforce the terms of this Agreement.

-5-

--------------------------------------------------------------------------------

 

 
11.
 
IDT hereby irrevocably and unconditionally releases, waives and fully and
forever discharges you from and against any and all causes of action, claims,
actions, rights, judgments, liabilities, accountings, obligations, demands and
damages of whatever kind or character, which the Corporation have against you,
by reason of or arising out of IDT’s employment of you and the separation of
your employment, or any statutory claims, or any and all other matters of
whatever kind, nature or description, whether known or unknown, from the
beginning of the world through and including the, Effective Date of this
Agreement, excluding any intentional acts or omissions by you prior to the
Effective Date of this Agreement which were outside the scope of your authority
and which were intended by you to cause harm to IDT. Nothing in this Section 11
shall restrict IDT’s ability to enforce the terms of this Agreement.

 

 
12.
 
IDT agrees to indemnify and bold you harmless from any action, claim, court
cost, damage demand and, expense, liability, loss, penalty, proceeding or suit,
together with any related attorneys fees, including costs and disbursements, by
reason of or arising out of (a) IDT’s employment of you, as an officer,
director, or in any other capacity, excluding any liability incurred due to (i)
intentional acts or omissions by you which were outside the scope of your
authority and which you intended to cause harm to IDT or (ii) the breach by you
of any fiduciary duty owed by you to the Corporation or (b) the breach by IDT of
its obligations hereunder

 

 
13.
 
If you violate the confidentiality provisions of this Agreement, IDT shall
suffer irreparable harm for which monetary damages may be inadequate. IDT shall
have the right to seek equitable relief, including injunctive relief, without
the requirement of posting a bond.

 

 
14.
 
Any dispute, except as provided elsewhere herein, arising out of or in
connection with this Agreement or the breach or alleged breach thereof shall be
resolved in Newark, New Jersey, by binding arbitration in accordance with the
rules of the American Arbitration Association. Each party shall choose one
arbitrator and tile two arbitrators shall then choose a neutral third arbitrator
who shall act as chairman. The prevailing party shall be entitled to receive
reimbursement for the costs of the Arbitration and reasonable attorney’s fees
and judgment on an award may be entered in any court having jurisdiction
thereof. The decision of the arbitrator shall be final and binding upon both
parties. Nothing in this paragraph shall be deemed as preventing either party
from seeking relief from the courts as necessary to protect either party’s name,
proprietary information, trade secrets, know how or any other appropriate
provisional remedy.

 

 
15.
 
This Agreement shall he governed by the laws of the State of New Jersey.

 

 
16.
 
By signing this Agreement, you acknowledge that the monies paid to you and
consideration provided to you under this Agreement exceed any payment or benefit
that you otherwise would receive under any IDT policy, agreement or plan

-6-

--------------------------------------------------------------------------------

 
and that this represents the full extent of IDT’s obligations to you; provided
that nothing contained herein shall be deemed to impair any right of you to
obtain coverage or payment under any insurance policy held by IDT which covers
its officers or employees. Any payments made to you pursuant to this Agreement
shall be subject to standard withholding and deductions.

 

 
17.
 
Furthermore, we both agree that the terms and conditions of this Agreement shall
remain confidential, except as needed to be shared (a) by you, with your legal
and financial advisors, who have been advised by you of the confidential nature
of this Agreement, and (b) by IDT, to a limited number of key individuals in the
normal course, or for business or legal purposes.

 

 
18.
 
In addition, we both agree that neither you, nor anyone at IDT, to the best of
our respective abilities, will in any way disparage the other, or act in any way
that is detrimental to the other’s good name and reputation. We both agree not
to engage m any conduct that would reasonably be expected to materially injure
or harm the other’s reputation or interest, provided that nothing contained
herein shall be deemed to require either party to violate any applicable law or
legal process or to fail to cooperate with any legal investigation or
proceeding.

 

 
19.
 
If, at any time after the Effective Date of this Agreement, any provision of
this Agreement shall be held to be illegal, void or unenforceable, such
provision shall be of no force and effect. However, the illegality or
unenforceability of such provision shall have no effect upon, and shall not
impair the enforceability of, any other provision of this Agreement, provided
that, upon a finding by a court or agency of competent jurisdiction that the
release of claims contained in paragraph 10 or 11 above, are illegal void or
unenforceable, the obligor under such unenforceable paragraph shall, at the
request of the other party hereto, will execute a release covering all the same
claims as are released under paragraph 10 or 1l (as the case may be) above, that
is legal and enforceable.

 

 
20.
 
Pursuant to the Older Workers Benefit Protection Act, you are advised to consult
with an attorney before signing this Agreement and that you shall have
twenty-one (21) days to consider this Agreement before signing it, but may sign
the Agreement at any earlier time if you so desires. If you sign this Agreement,
you shall have seven (7) calendar days (the “Revocation Period”) to revoke this
Agreement by indicating your desire to do so, in writing, addressed to IDT
Corporation, 520 Broad Street, 16th Floor, Newark, New Jersey 07102 (Attention:
James Courter, Chief Executive Officer of IDT). In order for such revocation to
be Effective, it must be received before 5:00 p.m. on the seventh day following
the date this Agreement was executed by you. The effective date of this
Agreement shall be the eighth (8th) day following the execution of this
Agreement (the “Effective Date”). In the event you do not accept this Agreement,
or revoke this Agreement during the Revocation Period, this Agreement in its
entirety, shall automatically be deemed null and void.

-7-

--------------------------------------------------------------------------------

 
Charles, on behalf of IDT Corporation, we wish you the best of luck in your
future career endeavors.
 
Sincerely,

--------------------------------------------------------------------------------

James A. Courter
Chief Executive Officer

 
Acknowledged and Agreed to:
       

--------------------------------------------------------------------------------

     
Date: 
 

--------------------------------------------------------------------------------

Charles H.F. Garner       
           

 
 

-8-