EMPLOYMENT
AGREEMENT
This
EMPLOYMENT AGREEMENT (the "Agreement") is made and entered
into as of January 1, 2007 (the "Effective Date"), by and
between NetSol Technologies, Inc., a Nevada corporation (the
"Company") and Naeem Ghauri, an individual
("Executive").
BACKGROUND
A.
The
Company desires assurance of the association and services of
Executive in order to retain Executive's experience, skills,
abilities, background and knowledge, and is willing to engage
Executive's services on the terms and conditions set forth in
this Agreement.
B.
Executive
desires to be in the employ of the Company, and is willing to
accept such employment on the terms and conditions set forth
in this Agreement.
AGREEMENT
In
consideration of the foregoing recitals and the mutual
promises and covenants herein contained, and for other good
and valuable consideration, the parties, intending to be
legally bound, agree as follows:
1.
EMPLOYMENT.
1.1
The
Company hereby enters into this Agreement with Executive, and
Executive hereby accepts employment under the terms and
conditions set forth in this Agreement for a period of three
years thereafter (the "Employment Period"); provided, however,
that the Employment Period may be terminated earlier pursuant
as provided herein. The Employment Period shall be
automatically extended for additional one-year periods unless
either party notifies the other in writing six months before
the end of the anniversary year to elect not to so extend the
Employment Period.
1.2
Executive
shall serve as President, Europe Region and Head of Global
Products Group (“Officer”) of the
Company.
1.3
Executive
shall perform all services, acts or things necessary or
advisable to manage and conduct the business of the Company
and which are normally associated with the position of Officer
and consistent with the bylaws of the Company.
1.4
The
employment relationship between the parties shall be governed
by the policies and practices established by the Company,
except that when the terms of this Agreement differ from or
are in conflict with the Company's policies or practices, this
Agreement shall control.
1.5
Unless
the parties otherwise agree in writing, during the term of
this Agreement, Executive shall perform the services he is
required to perform pursuant to this Agreement at the
Company's offices, located at its present or future locations
in the United States; provided, further, that the Company may
from time to time require Executive to travel temporarily to
other locations in connection with the Company's business and
in accordance with the Company's standard policies regarding
travel for executive and senior management
employees.
2.
LOYAL
AND CONSCIENTIOUS PERFORMANCE; NONCOMPETITION.
2.1
During
the Employment Period, Executive shall devote substantially
all his business energies, interest, abilities and productive
time to the proper and efficient performance of his duties
under this Agreement. The foregoing shall not preclude
Executive from engaging in civic, charitable or religious
activities, or from serving on boards of directors of
companies or organizations which will not present any direct
conflict with the interest of the Company or affect the
performance of Executive's duties hereunder.
2.2
Except
with the prior written consent of the Company's Board of
Directors (“Board”), Executive will comply with
all the restrictions set forth below at all times during his
employment and for a period of eighteen months after the
termination of his employment:
2.2.1
Executive will not, either individually or in conjunction with
any person, as principal, agent, director, officer, employee
or in any other manner whatsoever, directly or indirectly
engage in or become financially interested in any competitive
business within North America, except as a passive investor
holding not more than one percent of the publicly traded stock
of a corporation in which Executive is not involved in
management;
2.2.2
Executive will not, either directly or indirectly, on his own
behalf of on behalf of others, solicit, divert or appropriate
or attempt to solicit, divert or appropriate to any
competitive business, any business or actively sought
prospective business of the Company or any customers with whom
the Company or any affiliate of the Company has current
agreements relating to the business of the Company, or with
whom Executive has dealt, or with whom Executive has
supervised negotiations or business relations, or about whom
Executive has acquired confidential information in the course
of Executive's employment;
2.2.3
Executive will not, either directly or indirectly, on
Executive's behalf or on behalf of others, solicit, divert or
hire away, or attempt to solicit, divert, or hire away, any
independent contractor or any person employed by the Company
or any affiliate of the Company or persuade or attempt to
persuade any such individual to terminate his or her
employment with the Company; and,
2.2.4
Executive will not directly or indirectly impair or seek to
impair the reputation of the Company or any affiliate of the
Company, nor any relationship that the Company or any
affiliate of the Company has with its employees, customers,
suppliers, agents or other parties with which the Company or
any other affiliate of the Company does business or has
contractual relation; and,
2.2.5
Executive will not receive or accept for his own benefit,
either directly or indirectly, any commission, rebate,
discount, gratuity or profit from any person having or
proposing to have one or more business transactions with the
Company or any affiliate of the Company, without the prior
approval of the Board, which may be withheld;
and,
2.2.6
Executive will, during the term of this employment with the
Company, communicate and channel to the Company all knowledge,
business and customer contacts and any other information that
could concern or be in any way beneficial to the business of
the Company. Any such information communicated to the Company
as aforesaid will be and remain the property of the Company
notwithstanding any subsequent termination of Executive's
employment.
3.
COMPENSATION
OF EXECUTIVE.
3.1
The
Company shall pay Executive a base salary of Two Hundred
Twenty-Five Thousand Dollars ($225,000) per year (the "Base
Salary"), payable in accordance with the Company policy.
Executive shall receive a monthly car allowance of Two
Thousand Dollars ($2,000). Such salary shall be pro rated for
any partial year of employment on the basis of a 365-day
fiscal year. Executive will be eligible for bonuses from time
to time as determined by the Board.
3.2
Executive's
Base Salary and other compensation may be changed from time to
time by mutual agreement of Executive and the
Board.
3.3
All
of Executive's compensation shall be subject to customary
withholding taxes and any other employment taxes applicable to
Executive’s jurisdiction of employment as are commonly
required to be collected or withheld by the
Company.
3.4
During
the Employment Period, the Company agrees to reimburse
Executive for all reasonable and necessary business expenses
subject to the Company's standard requirements with respect to
reporting and documentation of such expenses.
3.5
Executive
shall, in accordance with the Company policy and the terms of
the applicable plan documents, be eligible to participate in
benefits under any Executive benefit plan or arrangement which
may be in effect from time to time and made available to its
executive or key management employees, including, as
applicable, health and disability insurance, dental insurance,
and participation in Employer’s 401(k) plan. The Company
may modify or cancel its benefit plan(s) as it deems
necessary.
3.6
Executive
shall cooperate with the Company and its insurers as
reasonably required for the Company to acquire and keep in
force key-man life insurance on Executive.
3.7
The
Company and Executive shall enter into an Indemnity Agreement
to provide indemnification of and the advancing of expenses to
Executive to the fullest extent (whether partial or complete)
permitted by law, and, to the extent the Company maintains
insurance, for the coverage of Executive under the
Company’s directors’ and officers’ liability
insurance policies.
4.
TERMINATION.
4.1
Termination
by the Company. Executive's employment with the Company may be
terminated under the following conditions:
4.1.1
Death
or Disability. Executive's employment with the Company shall
terminate effective upon the date of Executive's death or
"Complete Disability" (as defined in Section
4.5.1).
4.1.2
For
Cause. The Company may terminate Executive's employment under
this Agreement for "Cause" (as defined in Section 4.5.3) by
delivery of written notice to Executive specifying the cause
or causes relied upon for such termination. Any notice of
termination given pursuant to this Section 4.1.2 shall effect
termination as of the date specified in such notice or, in the
event no such date is specified, on the last day of the month
in which such notice is delivered or deemed delivered as
provided in Section 8 below.
4.1.3
Without
Cause. The Company may terminate Executive's employment under
this Agreement at any time and for any reason by delivery of
written notice of such termination to Executive. Any notice of
termination given pursuant to this Section 4.1.3 shall effect
termination as of the date specified in such notice (which
shall be no earlier than 30 days after such notice is given)
or, in the event no such date is specified, on the last day of
the month following the month in which such notice is
delivered or deemed delivered as provided in Section 8
below
4.2
Termination
By Executive. Executive may terminate his employment with the
Company for "Good Reason" (as defined below in Section 4.5.2)
by (i) delivery of written notice to the Company specifying
the "Good Reason" relied upon by Executive for such
termination, provided that such notice is delivered within six
(6) months following the occurrence of any event or events
constituting Good Reason, or (ii) at any time during the
Employment Period without Good Reason.
4.3
Termination
by Mutual Agreement of the Parties. Executive's employment
pursuant to this Agreement may be terminated at any time upon
a mutual agreement in writing of the parties. Any such
termination of employment shall have the consequences
specified in such agreement.
4.4
Compensation
Upon Termination.
4.4.1
Death
or Complete Disability. If Executive's employment shall be
terminated by death or Complete Disability as provided in
Section 4.4.1, the Company shall (i) pay Executive his accrued
Base Salary and accrued and unused vacation benefits earned
through the date of termination at the rate in effect at the
time of termination, and (ii) continue Executive's annual Base
Salary, in effect at the time of termination, for a period of
two (2) months after the termination date, in both cases
subject to standard deductions and withholding, and the
Company shall thereafter have no further obligations to
Executive under this Agreement.
4.4.2
Cause
or Without Good Reason. If Executive's employment shall be
terminated by the Company for Cause, or if Executive
terminates employment hereunder without Good Reason, the
Company shall pay Executive his accrued Base Salary and
accrued and unused vacation benefits earned through the date
of termination at the rate in effect at the time of the notice
of termination, and the Company shall thereafter have no
further obligations to Executive under this
Agreement.
4.4.3
Without
Cause or Good Reason. If Executive shall terminate Executive's
employment with the Company for Good Reason or the Company
shall terminate Executive's employment without Cause, or in
the event Executive is terminated for any reason following a
Change in Control, Executive shall be entitled to the
following:
(i)
Executive's
Base Salary, and accrued and unused vacation earned through
the date of termination;
(ii)
Continuation
of Executive's annual Base Salary, in effect at the time of
termination, for a period of thirty-six (36) months after the
termination date subject to standard deductions and
withholding;
(iii)
Continuation
of
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