EMPLOYMENT AGREEMENT

     THIS  EMPLOYMENT  AGREEMENT  dated as of the 1st day of October 2000 by and
between  NETWOLVES  CORPORATION,   a  New  York  corporation   (hereinafter  the
"Company") and Peter C Castle, an individual  residing at 30 Greenhaven  Circle,
Oldsmar, Florida 34677 (hereinafter called "Castle").

                              W I T N E S S E T H:

     WHEREAS,  the Company  desires to enter into an Employment  Agreement  with
Castle; and

     WHEREAS,  Castle  desires to enter into an  Employment  Agreement  with the
Company;

     NOW, THEREFORE, it is agreed as follows:

     1. Prior Agreements  Superseded.  This Agreement supersedes any employment,
consulting or other agreements, oral or written, entered into between Castle and
the  Company  prior to the  date of this  Agreement  except  for  stock  options
previously  granted to Castle,  which stock options shall continue in full force
and effect.

     2. Employment. The Company hereby agrees to employ Castle and Castle hereby
agrees  to serve as  Vice-President-Finance  of the  Company  with  commensurate
responsibilities  and to  perform  such  services  as  directed  by the Board of
Directors.  Castle's  employment  hereunder  shall be on a  full-time  basis and
Castle shall not engage in any other business, except with the prior approval of
the Board of Directors of the Company.  Castle shall serve in similar capacities
of such of the subsidiary  corporations of the Company as may be selected by the
Board  of  Directors  without  additional   compensation.   Notwithstanding  the
foregoing,  it is understood that the duties of Castle during the performance of
employment   shall  not  be   inconsistent   with  his  position  and  title  as
Vice-President-Finance of the Company.

     3.  Term.  Subject  to  earlier  termination  on the terms  and  conditions
hereinafter  provided,  the  term  of this  Employment  Agreement  shall  end on
September 30, 2003,  provided that this  agreement  shall extend for  additional
one-year  periods  unless Castle  receives  written notice from the Company each
year on or before July 1 of said year that the Company will be  terminating  the
agreement.  In no event,  however,  shall this agreement extend beyond September
30, 2005.

     4. Compensation.  For all services rendered by Castle under this Agreement,
compensation shall be paid to Castle as follows:

     (a) Castle shall be paid at the annual rate of One Hundred  Fifty  Thousand
($150,000) Dollars.

     (b) During the period of employment Castle shall be eligible to participate
in the Company's stock option and stock purchase plans to the extent  determined
in the discretion of the Board of Directors of the Company or committee thereof.

     (c) Castle shall be entitled to  participate in any short-term or long-term
incentive plan which the Company has in existence or which may be adopted.

     (d) During the period of employment,  Castle shall be furnished with office
space and secretarial service and facilities  commensurate with his position and
adequate for the performance of his duties.

<PAGE>

     (e) Castle shall be entitled to fully  participate in all benefit  programs
available to  executive  employees  of the Company  throughout  the term of this
Agreement.

     (f) Castle  shall be entitled to four (4) weeks of vacation and sick leaves
consistent with current practice of the Company.

     5.  Expenses.  Castle shall be reimbursed for all  out-of-pocket  expenses,
including medical expenses, reasonably incurred by him in the performance of his
duties hereunder.  Expense reports,  with receipts and  justifications,  must be
submitted to the Chairman of the Board for approval.

     6. Severance  Benefits.  Castle shall be entitled to the severance benefits
provided for in  subsection  (c) hereof in the event of the  termination  of his
employment  by  the  Company  without  cause  or in  the  event  of a  voluntary
termination of employment by Castle for good reason. In such event, Castle shall
have no duty to mitigate damages hereunder.  Castle and the Company  acknowledge
that the foregoing  provisions of this  paragraph 6 are reasonable and are based
upon the facts and  circumstances  of the parties at the time of  entering  into
this  Agreement,  and  with  this  Agreement,  and  with due  regard  to  future
expectations.

     (a) The term "cause" shall mean:

          (i) Castle's willful and continued  failure to  substantially  perform
     his duties under this Agreement (other than any such failure resulting from
     his  incapacity  due to  physical  or  mental  illness)  after  demand  for
     substantial performance is delivered to Castle by the Chairman of the Board
     of the Company which specifically  identifies the manner in which the Board
     believes Castle has not substantially performed his duties.

          (ii)  Castle's  failure  to  refuse  to  follow  directions  from  the
     Company's Board of Directors  provided that (a) Castle is provided  written
     notice of such  directions  and a reasonable  period in which to comply and
     (b) Castle's  compliance  with any such  direction  would not be illegal or
     unlawful.

          (iii)Any  act or  fraud,  embezzlement  or theft  committed  by Castle
     whether  or not in  connection  with his  duties  or in the  course  of his
     employment  which  substantially  impairs his ability to perform his duties
     hereunder.

          (iv) Any willful  disclosure by Castle of confidential  information or
     trade secrets of the Company or its affiliates.

          For purposes of this  paragraph,  no act or failure to act on Castle's
     part shall be considered  "willful"  unless done, or omitted to be done, by
     Castle not in good faith and without  reasonable  belief that his action or
     omission  was in the best  interest  of the  Company.  Notwithstanding  the
     foregoing,  Castle  shall not be deemed to have been  terminated  for cause
     unless and until there shall have been  delivered to him a copy of a notice
     of  termination  from  the  Chairman  of the  Board  of the  Company  after
     reasonable  notice to Castle and an opportunity for Castle with his counsel
     to be heard before the Board of  Directors  of the Company  finding that in
     the good faith opinion of such Board of Directors  Castle was guilty of the
     conduct  set forth in  clauses  (i),  (ii) or (iii) of this  paragraph  and
     specifying the particulars thereof in detail.

     (b) For these  purposes,  Castle shall have "good reason" to terminate this
Agreement if:

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<PAGE>


          (i)   the   Company    removes    Castle   from   the    position   of
     Vice-President-Finance at any time during the term of this Agreement;

          (ii) Castle's place of employment is moved beyond a fifty-mile  radius
     from the Company's current facility in Tampa, Florida.

     (c) The severance  benefits  under this section in the event of termination
without  cause or by Castle for "good  reason",  shall  consist of the continued
payment to Castle for the remaining term of this Agreement, of the annual salary
provided in Section 4(a) hereof plus the  immediate  vesting of all  outstanding
options.

     7. Death. In the event of Castle's death during the term of this Agreement,
Castle's  legal  representative  shall be entitled to receive his per annum base
salary as provided in  paragraph  4(a) of this  Agreement to the last day of the
calendar  quarter  following the calendar  quarter in which Castle's death shall
have  occurred  and  thereafter  to receive  one-half  (1/2) of the base  salary
provided  in  paragraph  4(a) of this  Agreement  for the  balance of the period
covered by this Employment Agreement.

     8. Non-Competition.

     (a) Castle  agrees that,  during the term of this  Agreement,  he will not,
without the prior  written  approval of the Board of  Directors  of the Company,
directly or indirectly,  through any other  individual or entity,  (a) become an
officer or employee of, or render any services [including  consulting  services]
to, any  competitor  of the  Company,  (b) solicit,  raid,  entice or induce any
customer of the Company to cease  purchasing  goods or services from the Company
or to become a customer of any  competitor  of the Company,  and Castle will not
approach any  customer for any such purpose or authorize  the taking of any such
actions by any other  individual  or entity,  or (c)  solicit,  raid,  entice or
induce any  employee  of the  Company,  and Castle  will not  approach  any such
employee for any such purpose or authorize  the taking of any such action by any
other individual or entity. However, nothing contained in this paragraph 8 shall
be  construed as  preventing  Castle from  investing  his assets in such form or
manner as will not require  him to become an officer or  employee  of, or render
any services (including consulting services) to, any competitor of the Company.

     (b) During the term hereof and at all times  thereafter,  Castle  shall not
disclose to any  person,  firm or  corporation  other than the Company any trade
secrets, trade information,  techniques or other confidential information of the
business of the Company, its methods of doing business or information concerning
its customers  learned or acquired by Castle during Castle's  relationship  with
the Company and shall not engage in any unfair trade  practices  with respect to
the Company.

     9. Enforcement.

     (a) The  necessity  for  protection  of the  Company  and its  subsidiaries
against  Castle's  competition,  as  well  as  the  nature  and  scope  of  such
protection,  has been carefully considered by the parties hereto in light of the
uniqueness of Castle's  talent and his  importance to the Company.  Accordingly,
Castle  agrees that, in addition to any other relief to which the Company may be
entitled,  the Company  shall be entitled to seek and obtain  injunctive  relief
(without the requirement of any bond) for the purpose of restraining Castle from
any actual or  threatened  breach of the  covenants  contained in paragraph 8 of
this Agreement.

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<PAGE>

     (b) If for any  reason  a court  determines  that  the  restrictions  under
paragraph 8 of this Agreement are not reasonable or that consideration  therefor
in adequate,  the parties  expressly  agree and covenant that such  restrictions
shall be interpreted,  modified or rewritten by such court to include as much of
the duration and scope identified in paragraph 8 as will render the restrictions
valid and enforceable.

     10.  Notices.  Any notice to be given to the  Company  or Castle  hereunder
shall be deemed given if delivered personally,  telefaxed or mailed by certified
or registered mail, postage prepaid,  to the other party hereto at the following
addresses:

     To the Company:                    NetWolves Corporation
                                        One Corporate Drive
                                        Suite 103
                                        Bohemia, NY  11716

     Copy to:                           David H. Lieberman, Esq.
                                        Blau, Kramer, Wactlar & Lieberman, P.C.
                                        100 Jericho Quadrangle
                                        Suite 225
                                        Jericho, NY  11753

     To Castle:                         Peter C. Castle
                                        30 Greenhaven Circle
                                        Oldsmar, Florida    34677

Either party may change the address to which notice may be given hereunder by
giving notice to the other party as provided herein.

     11.  Successors and Assigns.  This Agreement  shall inure to the benefit of
and be binding upon the Company,  its successors  and assigns,  and upon Castle,
his heirs, executors, administrators and legal representatives.

     12. Entire  Agreement.  This  Agreement  constitutes  the entire  agreement
between the parties except as specifically otherwise indicated herein.

     13. Governing Law. This Agreement shall be construed in accordance with the
laws of the State of New York.

     14. Change of Control.  In the event (a) the Company has been  consolidated
or merged into or with any other  corporation or all or substantially all of the
assets of the Company have been sold to another corporation, with or without the
consent of  Employee,  in his sole  discretion;  or (b) the Company  undergoes a
Change of Control, as hereinafter  defined below,  without prior Board approval;
then

Employee is entitled to the following settlement benefits:

          (i)  a lump-sum  payment  for the greater of (A) twelve (12) months of
               the annual  salary  provided  in section  4(a)  hereof or (B) the
               balance  of   compensation   for  the  term  of  this  Employment
               Agreement; and

          (ii) any and all stock  options and  warrants  held by Employee  shall
               become immediately vested and exercisable; if

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<PAGE>

               (A)  Employee  voluntarily and unilaterally  resigns his position
                    with the  Company  within 60 days of an event  described  in
                    Section 14(a) or (b) hereof, or

               (B)  Employee is given notice of termination directly as a result
                    of such  Change in Control  within  twelve (12) months of an
                    event described in Section 14(a) or (b) hereof, or

               (C)  Employee's  place of employment is moved beyond a fifty-mile
                    radius,  from its current  facility  in Tampa,  Florida as a
                    direct result of an event described in this Section.

     A  "Change  of  Control"  of the  Company,  or in any  person  directly  or
indirectly controlling the Company, shall mean:

     (i) a change of control  as such term is  presently  defined in  Regulation
240.12b-2 under the Securities Exchange Act of 1934 (the "Exchange Act");

     (ii) if during the Term of employment any "person" (as such term is used in
Section  13(d) and 14(d) of the  Exchange  Act)  other  than the  Company or any
person who on the date of this Employment  Agreement is a director or officer of
the Company,  becomes the  "beneficial  owner" (as defined in Rule 13(d)03 under
the  Exchange  Act),  directly  or  indirectly,  of  securities  of the  Company
representing  30%  of  the  voting  power  of  the  Company's  then  outstanding
securities; or

     (iii) if during the Term of employment the individuals who at the beginning
of such  period  constitute  the Board  cease for any reason  other than  death,
disability or retirement to constitute at least a majority thereof."

     IN WITNESS  WHEREOF,  the parties  hereto  have  executed  this  Employment
Agreement as of the day and year first above written.


                                    NETWOLVES CORPORATION

                                    By: /s/ Walter M. Groteke
                                        Walter M. Groteke
                                        Chairman of the Board


                                    /s/ Peter C. Castle
                                        Peter C. Castle
                                        Employee


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