EXHIBIT 10.01

August 3, 2007

Dear Claude:

This letter shall confirm our discussions with respect to your continued
employment with IDT Corporation and its subsidiaries, affiliates and divisions
(“IDT”), and shall supersede and replace all other contracts, agreements and
understandings between the parties regarding your employment by IDT (including,
without limitation, your December 31, 2003 employment letter agreement with
Net2Phone Cable Telephony (as amended April 13, 2005 and September 5, 2006). By
signing below in the space indicated, you agree to the following terms of your
employment:

 

Position:    You will serve as a Senior Vice President, Corporate Development
for IDT Corporation, and will report to the CFO of IDT Corporation. You shall
devote all of your business time and attention to the business and affairs of
IDT consistent with your position with IDT. Term:    The term of your employment
will be for two (2) years commencing August 1, 2007. Salary:    Your annual base
salary during the term will be $400,000, payable in accordance with IDT’s normal
payroll schedule. Bonus:    You will receive a guaranteed annual cash bonus
during the term of $100,000, payable in equal quarterly installments at the same
times as bonuses are paid to other similar executives of IDT in accordance with
IDT’s bonus plan. Options:    As soon as practicable after you sign this letter
(subject to the approval of IDT’s Compensation Committee and your execution of a
standard stock option agreement), you will be granted options to purchase 58,335
shares of IDT’s Class B common stock under IDT’s 2005 Stock Option and Incentive
Plan (the “Incentive Plan”) in accordance with the terms and provisions of such
plan. These options will vest over three (3) years.    For 2008 and thereafter,
you will be granted such awards under the Incentive Plan (or similar incentive
compensation plan) on a basis no less favorable than that basis generally
available to executives of IDT holding comparable positions.

Termination

Benefits:

  

 

In the event that, during the term, your employment is terminated by IDT without
Cause (as hereafter defined), then you shall be paid all accrued and unpaid
salary and bonus through the termination date, and you shall continue to receive
your salary and guaranteed bonus for the remainder of the term (payable in
accordance with IDT’s normal payroll schedule). As a condition to receiving the
foregoing severance, you will be required to execute and deliver IDT’s standard
confidential separation agreement and general release.

   In all other events, upon the termination of your employment you shall only
be entitled to be paid your accrued and unpaid salary and bonus through the
termination date.

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   For purposes of this letter, “Cause” shall mean any one of the following:   
(a) Your indictment or conviction by a court of competent jurisdiction or your
plea of guilty or nolo contendere to a felony under the laws of the United
States or any state thereof or a misdemeanor involving acts of dishonesty, theft
or moral turpitude under the laws of the United States or any state thereof;   
(b)your misappropriation or embezzlement of IDT funds;    (c)your commission of
an act of fraud with respect to IDT; or    (d)your willful failure to perform
your regular duties or failure to comply in any material respect with IDT’s
policies and procedures.    Unvested options, shares and other incentive awards
under the Incentive Plan shall vest/terminate upon the termination of your
employment in accordance with such plan and the terms and conditions of your
award agreement.    Upon termination, you will return to IDT any and all IDT
materials and equipment in your possession. Benefits:    You shall be entitled
to participate in fringe benefit programs in which IDT employees participate in
accordance with their terms. Vacation:    You shall be entitled to three (3)
weeks paid vacation to be taken and carried over from year to year in accordance
with IDT’s vacation policies.

Non-Disclosure,

Non-Competition

And

   Non-Solicitation:    The terms of your Non-Disclosure and Non-Competition
Agreement, dated July 7, 2006 shall remain in full force and effect in
accordance with its terms; provided that the business of the Company defined in
paragraph 1 thereof shall be replaced with the following: “Company is a
multinational company with operations that span various industries, and is
engaged in, among other things, providing telecommunications and internet
service worldwide to the retail and wholesale markets, voice-over-Internet
protocol communications services, and energy services; and in receivables
portfolio management and collection; ethnic food distribution; and brochure
distribution.” Withholding Taxes:    All compensation hereunder shall be subject
to applicable withholding taxes. Dispute Resolution:    Any dispute arising out
of or relating to this letter shall be finally determined by arbitration in the
State of New Jersey in accordance with the employment arbitration rules of the
American Arbitration Association by a neutral arbitrator with no direct or
indirect relationship to either party. In such arbitration, (a) the arbitrator
shall agree to treat all evidence as confidential; (b) the arbitrator shall have
no authority to amend or modify any of the terms of this Agreement; (c) the
arbitrator shall have ten (10) business days from the closing statements or
submission of post-hearing briefs by the parties to render his or her decision.
The results of any such arbitration shall be final and binding upon the parties
hereto, and any party may enforce any arbitration award in any court of
competent jurisdiction. Each party shall bear its/his own costs of participating
in the arbitration proceedings. Choice of Law:    This letter will be construed
and enforced in accordance with the laws of the State of New Jersey, without
regard to its conflict of law rules.

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All conditions of your employment, including the matters described above, will
be subject to the terms and policies that are set forth in IDT’s employee
handbook.

Please indicate your acceptance of the terms of this letter by your signature
below. This letter may be signed in two (2) or more counterparts, each of which
shall be deemed an original, and all of which, together, shall be deemed one and
the same document. Delivery of a facsimile version of one or more signatures to
this letter shall be deemed adequate delivery for purposes of this letter. Once
signed by both parties, this letter shall be binding on both parties.

 

Very truly yours, /s/ Steve Brown Steve Brown

 

Acknowledged and Agreed to: /s/ Claude A. Pupkin Claude Pupkin Dated: 8/3/07