Unassociated Document


    FIRST
      AMENDMENT TO LETTER AGREEMENT

    


    This
      First Amendment to Letter Agreement (this “Amendment”),
      is
      made and entered into as of December 21, 2006, by and among IXI
      MOBILE (R&D) LTD.,
      an
      Israeli limited liability company, (the “Subsidiary”),
      IXI MOBILE,
      INC.,
      a
      Delaware corporation (the “Parent”),
      GEMINI
      ISRAEL III LIMITED PARTNERSHIP, GEMINI ISRAEL III PARALLEL FUND LIMITED
      PARTNERSHIP, GEMINI ISRAEL III OVERFLOW FUND LIMITED PARTNERSHIP, GEMINI PARTNER
      INVESTORS LIMITED PARTNERSHIP
      (collectively, "Gemini")
      and
LANDA
      VENTURES LTD.
      (“Landa").
      The
      parties hereby agree as follows:

    


    RECITALS

    


    WHEREAS,
      the
      parties have previously entered into that certain Letter Agreement dated as
      of
      June 19, 2006 (the "Letter
      Agreement")
      in
      relation to a Loan Agreement by and among the Parent, the Subsidiary and
      Southpoint Master Fund LP ("Southpoint")
      dated
      of even date therewith (the "Loan
      Agreement");
      and


    


    WHEREAS,
      the
      parties to the Loan Agreement have recently entered into a Second Amendment
      to
      Loan Agreement (the "Second
      Amendment to Loan Agreement")
      attached hereto as Exhibit
      A,
      pursuant to which, among other things, the parties to the Loan Agreement amended
      the repayment and conversion terms of the loan provided to the Subsidiary by
      Southpoint under the Loan Agreement and, as a result of such amendment to the
      Loan Agreement, the parties now wish to amend the Letter Agreement so as to
      align certain terms of the Letter Agreement with the amended terms of the Loan
      Agreement, all as set forth in this Amendment. 

    


    NOW,
      THEREFORE,
      in
      consideration of the foregoing and for other good and valuable consideration,
      the receipt and adequacy of which are hereby acknowledged, the parties hereby
      agree as follows:

    


    Unless
      otherwise defined below, all capitalized terms herein shall have the meanings
      assigned to such terms in the Loan Agreement as amended by the Second Amendment
      to Loan Agreement.

    


    1.  Acknowledgement
      and Amendment of the Letter Agreement.

     

    1.1  Gemini
      and Landa hereby acknowledge and agree as follows:

     

    (a)  the
      terms
      of the Second Amendment to Loan Agreement are known and acceptable to Gemini
      and
      Landa.

     

    (b)  all
      references to terms and conditions of the Loan Agreement in the Letter
      Agreement, including, without limitation, all references to Sections 2.3, 2.4,
      3.2, 3.3 and 4.22 of the Loan Agreement, shall be deemed references to such
      terms as amended by the Second Amendment to Loan Agreement.

     

    (c)  all
      references in the Letter Agreement to the term "Repayment Date" shall be deemed
      references to the term "Repayment Date" as defined in the Second Amendment
      to
      Loan Agreement.

     

    (d)  all
      references in the Letter Agreement to the term "Basic Interest Rate" shall
      be
      deemed references to the term "Basic Interest Rate" as amended by the Second
      Amendment to Loan Agreement.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    (e)  Section
      5
      of the Letter Agreement is hereby amended and restated in its entirety to read
      as follows: 

     

    “5 In
      consideration of our undertakings pursuant to this Letter Agreement, by your
      signature below, you hereby acknowledge and agree as follows: (A) in the event
      the ITAC/IXI Merger becomes effective and subject to and conditioned upon the
      ITAC/IXI Merger becoming effective, ITAC shall issue, pursuant to the combined
      provisions of this Section 5 and the ITAC Certification (as defined below),
      a
      total amount of Four Hundred Thousand (400,000) shares of ITAC's Common Stock
      ("ITAC Stock"), par value $0.0001 per share, with each of us receiving the
      amount of ITAC Stock set forth apposite its respective name on Schedule I
      attached hereto, and, (B) the Subsidiary shall pay each one of us an amount
      equal to each our respective pro rata share in the balance between the Basic
      Interest Rate and the interest rate owed under the LOC and the Loan calculated
      on $8,000,000 for any period during which the Loan and/or LOC were outstanding
      during the period commencing on March 1, 2006 (the date on which the Guaranty
      was initially activated) and ending on the Repayment Date (if the ITAC/IXI
      Merger closes) or on the First Interest Payment Date and any subsequent interest
      payment under the Loan Agreement (if the ITAC/IXI Merger does not
      close).” 

     

    


     

    (f)
      Schedule I to the Loan Agreement is hereby amended and restated in its entirety
      to read as follows:

     

    “SCHEDULE
      I

    


    Allocation
      of ITAC Stock

    


    
      	
              Name
                of Entity

            	
              %

            	
              Amount
                Guaranteed

            	
              Number
                of ITAC Stock

            
	
              Gemini
                Israel III LP

            	
              45.00%

            	
              3,600,377

            	
              180,019

            
	
              Gemini
                Partners Investors LP

            	
              0.54%

            	
              43,042

            	
              2,152

            
	
              Gemini
                Israel III Parallel Fund LP

            	
              8.20%

            	
              656,381

            	
              32,819

            
	
              Gemini
                Israel III Overflow Fund LP

            	
              9.25%

            	
              740,200

            	
              37,010

            
	
              Landa
                Ventures Ltd.

            	
              37.00%

            	
              2,960,000

            	
              148,000

            
	
              Total

            	
              100%

            	
              8,000,000

            	
              400,000

            


    

    “

    


    


    2.  New
      Section 10A shall be added to the Letter Agreement as follows:

     

    “10A ITAC,
      Parent, Subsidiary and Gemini and Landa agree that (i) neither Gemini, Landa
      nor
      any of their respective partners have rendered or agreed to render any services
      to ITAC (or Parent or Subsidiary) in connection with this Letter Agreement;
      (ii)
      the Securities are not being issued as compensation for services; and (iii)
      upon
      issuance, the Securities shall be deemed to have prices as if they were issued
      independently.”

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    


    


    3.  ITAC
      Certification.
      The
      Parent and the Subsidiary shall use their best efforts to cause ITAC to execute
      and deliver to Gemini and Landa the Certification attached hereto as
Exhibit
      B.

     

    4.  No
      Other Modifications.
      Except
      as expressly set forth herein, all other terms and conditions of the Letter
      Agreement shall remain in full force and effect.

     

    5.  Miscellaneous.
      

     

    5.1  Counterparts;
      Fax Signatures.
      This
      Amendment may be executed in counterparts, each of which shall constitute an
      original, but all of which together shall constitute one and the same Amendment.
      Originally executed counterparts may be delivered by facsimile and any such
      delivery shall be valid for all purposes as delivery of a manual signature
      and
      equally admissible in any legal proceedings to which any of the Subsidiary,
      the
      Parent, or the Lender is a party.

     

    5.2  Severability.
      If any
      provision of this Amendment or the application thereof, shall for any reason
      and
      to any extent be determined by a court of competent jurisdiction to be invalid
      or unenforceable under applicable law, the remaining provisions of this
      Amendment shall be interpreted so as best to reasonably effect the intent of
      the
      parties hereto.

     

    5.3  Entire
      Agreement.
      This
      Amendment, together with the Loan Documents and all exhibits hereto and thereto,
      constitute the entire understanding and agreement of the parties with respect
      to
      the transactions contemplated herein and supersede all prior and contemporaneous
      understandings and agreements, whether written or oral, with respect to such
      transactions.

     

    5.4  Governing
      Law.
      This
      Amendment shall be governed in all respects by Section 15 of the Letter
      Agreement.

    


    


    [Remainder
      of Page Intentionally Left Blank]


    


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    IN
      WITNESS WHEREOF, the parties have executed this First Amendment to Letter
      Agreement as of the date first written above. 

    


    


    IXI
      MOBILE (R&D), LTD.

     

    By:
      /s/
      Lihi Segal

    


    Name:
      Lihi Segal

    


    Title:
      CFO

    


    


    IXI
      MOBILE, INC.

     

    By:
      /s/
      Lihi Segal

    


    Name:
      Lihi Segal

    


    Title:
      CFO

    


    


    


    


    


    [Signature
      Page to First Amendment to Letter Agreement]

     

    
 

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    


    IN
      WITNESS WHEREOF, the parties have executed this First Amendment to Letter
      Agreement as of the date first written above.

    


    GEMINI
      ISRAEL III LIMITED PARTNERSHIP

    by
      its
      general partner Gemini Capital Associates III L.P.,

    by
      its
      general partner Gemini Israel Funds Ltd.

    


    By:
      /s/
      David Cohen /s/ Yosi Sela

    Name:
      David Cohen Yosi Sela

    Title:
      CFO, GP Managing Partner       

       
             
       
       
            

    GEMINI
      ISRAEL III PARALLEL FUND LIMITED PARTNERSHIP

    by
      its
      general partner Gemini Capital Associates III, L.P.

    by
      its
      general partner Gemini Israel Funds Ltd.

    


    By:
      /s/
      David Cohen /s/ Yosi Sela

    Name:
      David Cohen Yosi Sela

    Title:
      CFO, GP Managing Partner          
       
       
       
       
       

     

    GEMINI
      ISRAEL III OVERFLOW FUND LIMITED PARTNERSHIP

    by
      its
      general partner Gemini Capital Associates III L.P.,

    by
      its
      general partner Gemini Israel Funds Ltd.

    


    By:
      /s/
      David Cohen /s/ Yosi Sela

    Name:
      David Cohen Yosi Sela

    Title:
      CFO, GP Managing Partner

    


    GEMINI
      PARTNER INVESTORS LIMITED PARTNERSHIP

    by
      its
      general partner Gemini Israel Funds Ltd.

    


    By:
      /s/
      David Cohen /s/ Yosi Sela

    Name:
      David Cohen Yosi Sela

    Title:
      CFO, GP Managing Partner

    


    


    [Signature
      Page to First Amendment to Letter Agreement]

    


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    IN
      WITNESS WHEREOF, the parties have executed this First Amendment to Letter
      Agreement as of the date first written above.

    


    

      
        	 	
                LANDA
                  VENTURES LTD.

              
	 	 	 
	 	
                By: 
                  

              	/s/
	 	 	 
	 	
                Name:

              	
                 

              
	 	 	 
	 	
                Title:

              	 


      



    


    


    


    


    


    


    
 

    


    [Signature
      Page to First Amendment to Letter Agreement]