Exhibit 10.27
 
Termination of Employment Agreement

Made in Tel Aviv on the 28 day of the month of June in the year 2007

Between:
Ness AT Ltd
 
of Kiryat Atidim Building 4, Tel Aviv
 
(hereinafter: the “Company”)   
Of the first part
     
And between:   
Ytzhak Edelman I.D. 50066174
 
of 4 Duchifat St. Tel Mond
 
(hereinafter: the “Manager”)
Of the second part

According to the following terms -

WHEREAS the Manager was employed by the Company pursuant to the terms of an
Employment Agreement dated April 21, 2005 (hereinafter, the “Employment
Agreement”); and

WHEREAS the Manager requested to terminate his employment at the Company and
leave his job position as CFO of the Company commencing on April 1, 2007; and

WHEREAS the parties wish to reach an agreement on the terms of the Manager’s
retirement from the Company, taking into consideration, inter alia, the terms of
his employment at the Company, the Company’s recognition of the Manager’s
contribution to the Company’s business, his unique acquaintance of the Company
and the know-how and expertise he accumulated in resolving problems in the
course of his employment and the Company’s need to also avail itself of the
Manager’s services from time to time in the future; and

WHEREAS the parties wish to reach agreement on the Manager’s continued
obligation to the Company on matters of confidentiality and restriction on
competition and the remuneration he shall receive on account thereof, as set
forth below in this Agreement.

Now therefore the parties hereto agree as follows:

1.
Preamble

1.1
The Preamble to this Agreement constitutes an integral part hereof.

1.2
The section headings are given for convenience of reference only and shall not
affect the interpretation of this Agreement.

2.
Termination of actual Employment and Notice Period

2.1
The Manager’s actual employment at the Company shall terminate on April 1, 2007
(hereinafter, the “Date of Actual Termination of Employment”). Commencing on the
Date of Actual Termination of Employment the Manager shall cease to serve in
office as an officer of the Company or its subsidiaries or affiliated companies
and the Manager shall sign any document required for this purpose.

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2.2
The parties hereby agree that their signature on this Agreement renders
unnecessary the Manager’s duty to give notice on termination of his employment
pursuant to his Employment Agreement and the Manager shall not be obligated to
give further notice beyond as stated in this Agreement.

2.3
The notice period to which the Manager is entitled pursuant to the Employment
Agreement shall commence on April 1, 2007. The notice period shall terminate on
September 30, 2008 and on this date the employer-employee relationship between
the parties shall also terminate (hereinafter, the “Date of Termination of the
Employment Relationship”).

2.4
The Manager shall not be required to actually work at the Company during the
notice period. However, in this period, the Manager shall cooperate with the
Company, if necessary, to the minimum degree necessary. The Manager’s assistance
shall be subject to prior coordination with him and obtaining his consent to the
dates and scope of hours necessary for this purpose.

2.5
In the course of the notice period the Company shall continue to grant the
Manager all the benefits to which he is entitled pursuant to the provisions of
the Employment Agreement, including use of the Company vehicle and cellular
phone, contributions to provident and other funds, accumulation of seniority for
social benefits (provident funds, vacation and sick leave) etc. as if he had
actually continued to work.

2.6
Moreover, the Manager shall receive the following payments:

2.6.1
Monthly wage of NIS 31,000 plus social provisions to which the Manager is
entitled on account of this amount, including a pension plan and/or pension fund
and advanced study fund, during the 18 month notice period.

2.6.2
A retirement grant in the sum of NIS 1,712,921 which shall be deposited in the
Retirement Grants Fund, as defined in section 5 below on the date of execution
of this Agreement.

2.7
It is hereby agreed that if the Manager requests to terminate the employment
relationship with the Company on an earlier date than that determined in this
Agreement, he shall be able to do so, and in such circumstances the Company
shall pay the Manager the balance of the amounts owed to him under subsection
2.6.1 above in one payment, within 7 days of the date of receipt of such a
request. The employer-employee relationship between the parties shall terminate
on the date of receipt of the balance of monies by the Manager.

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3.
Non-Competition

3.1
The parties hereby agree that the Manager’s period of non-competition under the
Employment Agreement shall be extended by six further months (so that it shall
be 18 months after the Date of Termination of the Employment Relationship).

3.2
As special remuneration for the non-competition period and its extension, and in
order that the non-competition clause in the Employment Agreement shall remain
in force pursuant to the case law of the courts and labor courts on the date of
execution of this Agreement, the Company shall pay the Manager a sum of 950,000
NIS (hereinafter, the “Special Consideration for Non-Competition”).

3.3
The Special Consideration for Non-Competition shall be transferred to the
Retirement Grants Fund on the date of execution of this Agreement and the rules
set forth below in this Agreement shall apply thereto.

4.
Directors & Officers Liability Insurance

4.1
The Company shall undertake to pay the payments necessary for including the
Manager in a directors and officers liability insurance on account of his
employment and position at the Company and its subsidiaries and affiliated
companies.

4.2
The Company declares that it acted and shall act as aforesaid even after the
Manager’s actual termination of employment and it shall also continue to make
such payments after the execution of this Agreement and until termination of all
the limitation periods for a claim against him.

5.
Retirement Grants Fund

5.1
The Company shall appoint a trustee (hereinafter, the “Trustee”) who shall act
to ensure performance of this Agreement and the Trust Agreement attached as
Appendix A of this Agreement.

5.2
The Trustee shall be registered as an irrevocable beneficiary of the policy /
the Manager’s increased retirement grants deposit, in the beneficiary’s lifetime
clause.

5.3
On the Date of Termination of the Employment Relationship or in the event of the
death of the Manager prior to such date (hereinafter, the “Entitling Event”),
the Company shall instruct the entity managing the Retirement Grants Fund and
the Trustee to transfer to the Manager or the beneficiaries appointed by the
Manager (as the case may be), the amounts accumulated to his credit in the
Retirement Grants Fund, including any profit accumulated on account thereof.

5.4
The Company shall instruct the entity managing the Retirement Grants Fund and
the Trustee to transfer of the monies, as stated above, by no later than 30 days
after the date of the occurrence of the Entitling Event and the submission of
all documents and certificates necessary under the provisions of any law.

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5.5
Any tax or other compulsory payment, as they may be from time to time, of any
type whatsoever, on account of payment of the monies accumulated in the
Retirement Grants Fund or for the profits on account thereof, shall be payable
by the Manager, and upon his death, shall be payable by the beneficiaries to be
determined by the Manager.

5.6
The Manager declares and agrees that he shall not be entitled to assign, impose
a lien, grant or transfer in any manner whatsoever his right to receive the
monies accumulated in the Retirement Grants Fund, including any profits on
account thereof, apart from a transfer to beneficiaries to be determined by the
Manager in the event of his death.

6.
Activities of the Parties on the Date of Termination of the Employment
Relationship

6.1
In addition to the payments mentioned above, the Company shall deliver to the
Manager letters of release for the pension plan (including on account of the
severance pay component) and for the advanced study fund managed in his favor,
within 15 days of the Date of Termination of the Employment Relationship.

6.2
On the Date of Termination of the Employment Relationship the Company shall
assign to the Manager his rights as they may be, vis-a-vis the leasing company
in all matters relating to the acquisition of the Company vehicle which had been
provided for his use.

6.3
The cellular phone affixed in the vehicle shall be transferred to the ownership
of the Manager, and he shall also have transferred into his ownership the
cellular phone used by him until the Date of Termination of the Employment
Relationship, all at no charge.

6.4
Furthermore, the laptop computer used by the Manager in the course of his term
of employment shall be gratuitously transferred to the ownership of the Manager,
subject to the removal of any information belonging to the Company.

7.
No Claims or Contentions

7.1
The Company hereby certifies that upon the execution of this Agreement and
subject to performance and compliance with its terms, it or any person acting on
its behalf does not have and shall not have any contention and/or claim of any
kind or form whatsoever against the Manager or any one acting on his behalf
apart from the fulfillment of his duties to keep confidentiality, non
solicitation of employees and non-competition under the Employment Agreement as
extended in this Agreement.

7.2
The Manager declares that payment and/or release and/or performance of the
payments and rights mentioned in this Agreement and the Employment Agreement and
settling of accounts amounts constitute absolute and final payment of all that
is owed to him from the Company or any other company from the Ness Technologies
Inc. group or anyone acting on their behalf and of all his claims or demands
vis-א-vis the Company, including on account of wages, bonuses, severance pay,
vacation days and redemption of vacation days, sick pay, notice period and
redemption of notice period, recuperation pay, travel fees, holiday gifts,
reimbursement of any expenses whatsoever, courses and professional seminars, any
social benefits (including pension plan, advanced study fund, etc.), any payment
related to and/or derived from the Manager’s rights under any incentive plan
and/or grants of any kind whatsoever.

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7.3
For the removal of any doubt it is hereby clarified that the provisions of
section 7.2 above shall not constitute a waiver of the options to which the
Manager is entitled by virtue of the Employment Agreement and that the
conditions agreed between the parties in the Employment Agreement and its
appendices shall apply.

8.
Taxation and Compulsory Payments

8.1
The amounts under this Agreement - excluding payments or benefits to which the
Manager is entitled to receive in net values or with tax gross up - are gross
amounts and any tax and/or any compulsory payment applying to them under the
provisions of any law, shall be paid by the Manager.

8.2
The Company shall deduct any tax and/or compulsory payment applying as aforesaid
and any personal deduction applying to the Manager under the provisions of any
law or agreement and pursuant to approvals the Manager shall submit to the
Company from the tax authorities, if any.

8.3
It is hereby agreed and clarified that the Company shall not deduct taxes or
compulsory payments at source from the payments it shall transfer to the
Retirement Grants Fund and that at the time of withdrawal of the monies from the
Fund, all tax liabilities as shall be in force on the date of withdrawal shall
apply to the Manager.

8.4
For the removal of any doubt it is hereby clarified that the payments mentioned
as a limitation in subsection 8.1 above (viz., payments paid in net values)
include the Company’s payments to the Manager on account of the value of the use
of the vehicle and the payments to the advanced study fund.

9.
Status of Agreement

9.1
This Agreement and the Employment Agreement jointly reflect the consents of the
parties with respect to the Manager’s termination of employment at the Company.

9.2
It is hereby clarified and agreed that this Agreement does not invalidate the
consents of the parties as expressed in the Employment Agreement, except on
issues expressly dealt with in this Agreement. Hence, on all issues not dealt
with in this Agreement, the terms of the Employment Agreement shall continue to
apply.

9.3
The Agreement is subject to the approval of Ness Technologies Inc. Stock Option
and Compensation Committee.

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10.
General

10.1
Israeli law shall apply to this contract and its interpretation.

10.2
Any modification of the provisions of this contract shall be in writing only and
signed by both parties.

10.3
Any dispute between the parties in connection with and deriving from this
contract shall be heard by the competent courts in Tel Aviv.

10.4
The addresses of the parties are as set forth in the preamble to this Agreement.
Any notice sent by one party to the other party by registered mail shall be
deemed to have been received within 72 hours of having been handed in at the
post office for dispatch by registered mail. In the case of a notice sent by
facsimile, it shall be deemed to have been received on the first business day
after its transmission.

In witness whereof the parties hereto have set their hands and seals:
 

 
The Company
 
 
 
DATE: June 28, 2007
BY:
/s/ Issachar Gerlitz
 
 
Name:
Issachar Gerlitz
 
 
Title:
President & Chief Executive Officer
 
 
 
 
 
 
/s/ Ofer Segev
 
 
Name:
Ofer Segev
 
 
Title:
Chief Financial Officer
 
 
 
 
 
The Manager
 
 
 
 
 
DATE: June 28, 2007
 
/s/ Ytzhak Edelman
 
 
Ytzhak Edelman

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Appendix A - Trust Agreement

Made in Tel Aviv on the 28 day of the month of June in the year 2007

BY AND BETWEEN:  
Roi Poplaik and co, Trust Company
 
of 1 Linkolen Street,
 
Robinstein Tower Tel Aviv
 
(hereinafter, the “Trustee”)  
Of the first part
     
AND:
Ness AT Ltd.
 
of Kiryat Atidim Building 4 Tel Aviv
 
(hereinafter: the “Company”)
Of the second part
     
AND:
Ytzhak Edelman I.D. 50066174
 
of 4 Duchifat St. Tel Mond
 
(hereinafter: the “Manager”)
Of the third part

WHEREAS the Company and the Manager signed a termination of employment agreement
of which this Agreement constitutes an Appendix; and

WHEREAS the Trustee was appointed by the Company to conduct the activities
necessary to perform this Agreement and the Manager’s termination of employment
agreement; and

WHEREAS the Trustee agrees to assume the performance of the activities
stipulated in this Agreement and the termination of employment agreement, all in
accordance with the definition of his function in the Trust Law, 5739-1979
(hereinafter, the “Law”).

Now therefore the parties hereto agree as follows:

1.
Preamble

1.1
The Preamble to this Agreement constitutes an integral part hereof.

1.2
The section headings are given for convenience of reference only and shall not
affect the interpretation of the Agreement.

 
1.3
Terms not defined expressly in this Agreement shall be interpreted as stated in
the termination of employment agreement.

2.
Activities and Duties of the Trustee

2.1
The Trustee shall be an irrevocable beneficiary to receive any amount
accumulated in the Manager’s favor in the Retirement Grants Fund, as defined in
the termination of employment agreement, including the profits accumulated on
account thereof.

2.2
The Company shall open a special account for the purpose of management of the
Retirement Grants Fund and for the purpose of performing the other activities
under this Agreement and the termination of employment agreement (hereinafter,
the “Special Account”).

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2.3
The Company shall transfer monies to the Special Account pursuant to the
provisions of the termination of employment agreement.

2.4
The Trustee shall approve the release of the amounts accumulated in the Special
Account on the date of the Entitling Event, as defined in the termination of
employment agreement and pursuant to the provisions of the termination of
employment agreement.

3.
Obligations of the Company and the Manager

3.1
The Company and the Manager undertake to provide the Trustee with any
information or approval, at his sole discretion, and to sign any document
necessary in his opinion for performance of the activities he is obligated to
perform under the termination of employment agreement, under this Agreement and
under the provisions of any law.

3.2
The Manager hereby undertakes to indemnify the Trustee for any loss and/or
damage and/or debt and/or expense incurred by him in connection with the
fulfillment of his position under this Agreement, including and without
derogating from the generality of the aforesaid, losses, damage and expenses
incurred by him in consequence of raising any contentions on the part of any of
the parties to this Agreement and/or the contentions of any third party
whatsoever, and to be liable for his fee as agreed with him.

3.3
The Trustee shall act in good faith and loyally on behalf of the parties as set
forth in this Agreement and the termination of employment agreement.

4.
General

4.1
No amendment, modification or addition to this Agreement shall be valid unless
made in writing and signed by all the parties to this Agreement.

4.2
The addresses of the parties are as set forth in the preamble to this Agreement.
Any notice sent by one party to the other party by registered mail shall be
deemed to have been received within 72 hours of having been handed in at the
post office for dispatch by registered mail. In the case of a notice sent by
facsimile, it shall be deemed to have been received on the first business day
after its transmission.

In witness whereof the parties hereto have set their hands and seals:

 
The Company
         
DATE: June 28, 2007
BY:
/s/ Issachar Gerlitz
   
Name:
Issachar Gerlitz    
Title:
President & Chief Executive Officer

 

 
 
/s/ Ofer Segev
 
 
Name:
Ofer Segev
 
 
Title:
Chief Financial Officer
 
 
 
 
 
The Trustee
 
     
 
 
DATE: June 28, 2007
 
/s/ Roi Poplaik
 
 
Roi Poplaik
 
 
 
 
 
The Manager
 
 
 
 
DATE: June 28, 2007
 
/s/ Ytzhak Edelman
 
 
Ytzhak Edelman

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