EXHIBIT 10.8
MEMORANDUM AND AMENDMENT
This memorandum and amendment (the "Memorandum"), dated as of May 31, 1999,
is by and among ITXC Corp. ("ITXC"), TeleNova Comunicacoes Ltda. ("TeleNova")
and Telesisa Sistemas emTelecomunicacoes S.A. ("Telesisa") for the purposes of
setting forth certain procedural matters pertaining to the Joint Venture
Agreement, dated as of July 19, 1998, between ITXC and TeleNova, as amended (as
amended, the Agreement"), and amending certain portions of the Agreement. All
capitalized terms in this Memorandum that are not defined in this Memorandum
have the meanings ascribed to such terms in the Agreement. Each Party (i.e.,
ITXC, TeleNova, and Telesisa) hereby acknowledges and agrees as follows:
1. TeleNova and Telesisa acknowledge that on or before May 17, 1999, ITXC
provided it with written notice that ITXC intends to effect an IPO (the "IPO
Notice") and intends to file a Registration Statement with the SEC on or before
June 30, 1999.
2. To the extent, if any, that the Agreement requires ITXC to provide
TeleNova and Telesisa with the IPO Notice at least sixty days prior to the
initial filing of the Registration Statement, TeleNova and Telesisa hereby waive
that requirement and a knowledge that ITXC shall be deemed to have given
sufficient notice of the IPO for purposes of Section 16.3 of the Agreement.
3. TeleNova and Telesisa waive any and all rights that they may have to
exercise the IPO Put Right described in Section 16.3.2 of the Agreement.
4. The definition of "Pre-IPO Period" in Section 16.3.1 of the Agreement
for the purpose of the calculation of Trailing ITXC Revenues shall remain as in
effect before the execution of this Memorandum and Understanding; however,
solely for the purpose of the calculation of Trailing Company Revenues, such
definition is hereby amended to provide as follows:
"`Pre-IPO Period' shall mean the six month period from March 1, 1999
through and including August 31, 1999."
5. ITXC waives any right that it may have to presently exercise its call
rights under Section 16.3.3 of the Agreement. In lieu of such rights, Section
16.3.3 of the Agreement is hereby amended in its entirety to provide as follows:
"IPO Call Right. At any time during the period from September 1, 1999
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through and including the later of (i) September 15, 1999 and (ii) the
tenth calendar day after the Company provides ITXC with its financial
statements for the period from March 1, 1999 through August 31, 1999, ITXC
may give notice to any Non-ITXC Party (a "Non-Put Party") that ITXC intends
to exercise its call rights pursuant to this Section 16.3.3. Such notice
shall include and be accompanied by the full text of the investment letter,
lock-up letter and legend or legends referred to in Section 16.3.5(a) and
16.3.5(b) of the Agreement. Such notice shall be preceded by a telephonic
meeting between ITXC and the Non-ITXC Parties, scheduled at ITXC's
convenience, in order to set forth procedural matters pertaining to the
exercise of ITXC's call rights. In the event that (a) ITXC provides a Non-
Put Party with notice of exercise of its call rights in a timely and
appropriate manner and (b) ITXC consummates its IPO on or before November
30, 1999, then, at a closing (the "Closing") to be held on the later of the
fifteenth day after such Non-Put Party receives such notice and the day on
which the IPO is consummated, ITXC shall purchase from such Non-Put Party,
and such Non-Put Party shall sell to ITXC, all of such Non-Put Party's
Quotas at a purchase price equal to the IPO Call Price multiplied by such
Non-Put Party's Fraction. In the event that the IPO is not consummated on
or before November 30, 1999 for any reason, the Closing shall not be held
and the exercise of such call rights shall be void and of no effect. At
the option of such Non-Put Party, such purchase price may be paid in cash
or in shares of ITXC's Common Stock, valued at the IPO Price, or in such
combination of cash and such shares as such Non-Put Party shall determine,
provided that such determination is made within five business days after
ITXC notifies such Non-Put Party that it intends to exercise its call
rights pursuant to this Section 16.3.3. For purposes of this Agreement, the
IPO shall be deemed to be consummated on the first date on which the
proceeds of the IPO are paid to ITXC."
6. The Parties acknowledge that the deliveries contemplated by Section
16.3.5 (a) of the Agreement shall be made prior to the Closing.
7. If ITXC exercises its call pursuant to Section 16.3 of the Agreement,
ITXC will, promptly after such information is available to ITXC, provide to each
Non-ITXC Party the data necessary to calculate the Trailing ITXC Revenues (i.e.,
ITXC's revenues during the Pre-IPO Period). ITXC will also provide each Non-ITXC
Party with its current estimate of the IPO Value and will update that estimate
from time to time through the time that the IPO Price is ultimately determined.
8. Under the United States securities laws, it is essential that the
information provided by ITXC to each Non-ITXC Party with respect to the proposed
IPO be held in strict confidence. Each Non-ITXC Party will maintain the
confidentiality of such information, except to the extent that ITXC makes such
information public at a later date. All information to be supplied by ITXC
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pursuant to paragraph 7 above will be held in confidence by each Non-ITXC Party
pursuant to Article 9 of the Agreement.
9. In all other respects, the Agreement remains in full force and effect.
10. In the event that (i) the Registration Statement relating to the IPO
for which notice has been acknowledged in Section 1 hereof is not initially
filed with the SEC on or before June 30, 1999 or (ii) such IPO is not
consummated as contemplated by Section 16.3.3 of the Agreement on or before
November 30, 1999, this Memorandum and Amendment shall be void and the Agreement
shall be deemed to contain each of the terms set forth in the Agreement
immediately prior to the execution of this Memorandum and Amendment.
IN WITNESS WHEREOF, the parties hereto have executed this Memorandum as of the
date first above stated.
ITXC CORP.
/s/ Xxx Xxxxxx
By:__________________________
Xxx Xxxxxx, Chairman
TELESISA SISTEMAS EMTELECOMUNICACOES S.A.
/s/ Antonio Borrali /s/ Rubers Frangiotti
By:__________________________________________
President Administrative Director
TELENOVA COMUNICACOES LTDA.
/s/ Xxxxx Xxxxxxx
By:_________________________________
Xxxxx Xxxxxxx, G.A.
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