Unassociated Document


    EXHIBIT
10.1

     

    
      	
               

            	
               

            
	
               

            
	 	 


    

    OFFER
OF EMPLOYMENT LETTER

    
      


      September
19, 2010

      


      


      


      Arie
Rand

      I.D. No.
56099633

      1 Yizrael
Street

      P.O.B.
305

      Shoham,
60850

      Israel

      


      Dear
Arie,

       

      On behalf
of Delta Three Israel, Ltd. (“Delta Three Israel”), I am pleased to extend to
you an offer of employment in accordance with the following terms and
conditions.

       

      This is a
full time assignment, beginning on or about October 3, 2010 (the “Starting
Date”). Initially you will serve as a member of the Finance Department and work
closely with Ziv Zviel in preparing to assume the positions of Chief Financial
Officer and Treasurer.  Immediately upon Mr. Zviel’s departure from
the Company (currently expected to be on or about October 15, 2010) you will
become the Chief Financial Officer and Treasurer of Delta Three Israel and
deltathree, Inc. (“deltathree”, and together with Delta Three Israel, the
“Company”) reporting to both the Chief Executive Officer and President of the
Company and the Board of Directors of deltathree.

       

      The
duties and responsibilities of serving as the Chief Financial Officer and the
Treasurer of the Company include, but are not limited to, the
following:

       

      
        	
                 
      

              	
                ·

              	
                Supervising
      the other members of the Finance
Department;

              


      

      
        	
                 
      

              	
                ·

              	
                Maintaining
      the Company’s books and records in accordance with U.S. and Israeli GAAP
      (as applicable);

              


      

      
        	
                 
      

              	
                ·

              	
                Preparing
      monthly, quarterly and annual financial reports and assisting in the
      preparation of the Forms 10-Q and Forms 10-K filed by the Company with the
      SEC;

              


      

      
        	
                 
      

              	
                ·

              	
                Managing
      the Company’s monthly cash flow and arranging for payment of
      invoices;

              


      

      
        	
                 
      

              	
                ·

              	
                Monitoring
      and supervising the Company’s compliance with the Sarbanes-Oxley
      Act;

              


      

      
        	
                 
      

              	
                ·

              	
                Assuming
      responsibility for all credit and banking relationships and
      activities;

              


      

       

       

       

      
        224 West
35th
Street, Suite 1004, N.Y., NY 10001, U.S.A. Tel (212) 500-4899 Fax (212)
500-4888

        Jerusalem
Technology Park, P.O.B. 48265, Jerusalem, Israel, Tel 972-2-649-1222 Fax
9722-649-1200

      

      
        
          
          

        

        
          Page 1 of
6

          
            

          

        

        
          
          

        

      

       

      
         

        
          	
                   

                	
                   

                
	
                   

                
	 	 


        

         

      

      
        	
                 
      

              	
                ·

              	
                Arranging
      for insurance for the Company; and

              


      

      
        	
                 
      

              	
                ·

              	
                Consulting
      and advising the Company’s officers and directors on a range of issues
      related to finance (including financial controls, accounting, financial
      analysis and capital management), strategy, risk management,
      compliance/regulatory issues, acquisitions, and outside
      investment.

              


      

       

      You will
be eligible to receive monthly compensation according to the table below.
Payments will be made every month, starting on or before the ninth of the month
following the commencement of your employment. You acknowledge that your
monthly compensation stated below includes remuneration for all allowances and
benefits required by law, by extension of the law, or any collective bargaining
agreements (with the sole exception of travel allowances and meal allowances,
also described below), as follows:

       

      
        	
                Type
      of Payment

              	
                Sum

              
	
                Base
      Salary

              	
                10,000
      USD (with payment in NIS according to the official exchange rate of the
      Bank of Israel on the day of payroll processing).

              
	
                Travel
      Allowance

              	
                Equal
      to intercity bus fare (“chofshi-chodshi”) (up to a maximum currently set
      at 510 NIS).

              
	
                Meals

              	
                Up
      to a maximum currently set at 14 NIS per meal, plus income tax, as
      appropriate for the portion subsidized by the Company.

              
	
                Dmei
      Havra’a

              	
                One-twelfth
      (1/12) of the annual payment due included in the gross monthly salary
      offered above, as this amount may be adjusted from time to
      time.

              


      

       

      Also,
management will recommend to the Compensation Committee of the Board of
Directors of deltathree that upon the commencement of your employment you be
granted stock options to purchase 300,000 shares of deltathree common stock,
which will vest ratably over a period of four (4) years, under and in accordance
with the deltathree, Inc. 2009 Stock Incentive Plan.

       

      You are eligible to lease a car through
the Company according to the rates, policies and procedures of the Company.
Please note that if you wish to lease a car (i) your Base Salary will be
reduced by the amount of your monthly car lease price, (ii) you will pay tax and
Bituach Leumi on the reduced Base Salary and (iii) all salary-related benefits
(such as Manager's Insurance, severance pay and Keren Hishtalmut) will be
calculated based upon the reduced Base Salary.  You will pay the tax
applicable to the lease of your car as required by the law, which will be
automatically deducted from your monthly paycheck. For example, if your Base
Salary (as indicated in the table above) is 40,000 NIS (at an exchange rate of 4
NIS for 1 USD) and the car lease cost is 4,000 NIS per month, your reduced
monthly Base Salary will be 36,000 NIS.  As a condition of leasing a
car you are required to sign the Company’s car policy and car lease
addendum.  Please note that if you lease a car through the Company,
you will not be eligible to receive the Travel Allowance described in the table
above.

       

       

      
        
          224 West
35th
Street, Suite 1004, N.Y., NY 10001, U.S.A. Tel (212) 500-4899 Fax (212)
500-4888

          Jerusalem
Technology Park, P.O.B. 48265, Jerusalem, Israel, Tel 972-2-649-1222 Fax
9722-649-1200

        

      

      
        
          
          

        

        
          Page 2 of
6

          
            

          

        

        
          
          

        

      

       

      
         

        
          	
                   

                	
                   

                
	
                   

                
	 	 


        

         

      

      You are
expected to work a five-day week, Sunday through Thursday inclusive, from
9:00-18:00. In calculating the Base Salary, it is understood that you will be
involved in duties which require your special personal care and loyalty, and
therefore the provisions of the Work Hours and Rest Law, 1951, or any law that
may be enacted in its place, will not apply to you.  You will not be
entitled to remuneration according to the Work Hours and Rest Law and
acknowledge that your Base Salary has already been increased to include within
it all payments which are paid to an employee who is paid in accordance with the
directives of the Work Hours and Rest Law.  You are expected to work
those days and hours necessary for the proper performance of your
duties.

       

      The
Company shall pay on a monthly basis and on your behalf the following amounts
toward a Managers’ Insurance Policy (the “Managers’ Insurance”) and/or (in your
sole discretion) a pension plan (“Pension Plan”) (severally or jointly, as
applicable, the “Insurance”) chosen by you:

       

      Managers’ Insurance:
The Company shall pay a sum equal to 13.3% of your monthly Base Salary towards
your Manager’s Insurance (of which 8.33% shall be contributed towards severance
pay and 5% shall be contributed towards a pension fund) and a sum up to
2.5% of your monthly Base Salary towards disability pension payments. The
Company shall deduct an amount equal to 5% from your monthly Base Salary and
contribute such amount on your behalf towards your Managers’ Insurance (all of
which shall be contributed towards a pension fund).

       

      Pension Plan: The
Company shall pay a sum equal to 13.3% of your monthly Base Salary towards your
Pension Plan (of which 8.33% shall be contributed towards severance pay and 5%
towards a pension fund). The Company shall deduct an amount equal to 5% from
your monthly Base Salary and contribute such amount on your behalf towards your
Pension Plan (all of which shall be contributed towards a pension
fund).

       

      You and
the Company hereby accept the terms of the General Approval Regarding Employer
Payments to Pension Fund and Insurance Policy in Lieu of Severance Pay in
Accordance with the Severance Pay Law 5723-1963 (the “General Approval”) and
accept and agree that the payments described above are in lieu of all the
Company’s obligations under the Severance Pay Law, 5723-1963, as the same may be
amended. A translation of the General Approval is attached as Appendix A hereto and
constitutes an integral part hereof.

       

       

      
        
          224 West
35th
Street, Suite 1004, N.Y., NY 10001, U.S.A. Tel (212) 500-4899 Fax (212)
500-4888

          Jerusalem
Technology Park, P.O.B. 48265, Jerusalem, Israel, Tel 972-2-649-1222 Fax
9722-649-1200

        

      

      
        
          
          

        

        
          Page 3 of
6

          
            

          

        

        
          
          

        

      

       

      
         

        
          	
                   

                	
                   

                
	
                   

                
	 	 


        

         

      

      You will
be eligible to receive Keren Hishtalmut from your first day of
employment.  Pursuant to the terms of this plan, you may contribute
2.5% of your Base Salary and the Company will contribute an amount equal to 7.5%
of your Base Salary.  Keren Hishtalmut will be provided up to the
monthly salary ceiling set by the income tax authorities.

       

      You are
eligible for our Company yearly bonus plan, subject to the terms of the plan and
the Company’s policies.   There is no automatic entitlement to a
bonus.

       

      You will
be entitled to take up to 18 vacation days per year, which will accumulate on a
monthly basis at a rate of 1.5 days per month. Your vacation allotment will be
updated according to our absence procedures and according to the law.
Furthermore, you are encouraged to take vacation days during the actual calendar
year in which they are accrued.  Excess vacation days not used by the
end of each calendar year are forfeited, provided that if you have not used all
your vacation days by the end of the calendar year you may carry over up to five
days through the end of the first quarter of the following calendar
year.

       

      The full
terms, conditions and company benefits of your employment are detailed in our
employee handbook, which might be amended by the Company from time to time to
better address the Company’s needs provided that any such amendment may not
adversely affect your terms of employment.  The handbook is on our
network you are required to read it during the first two weeks of your
employment and sign and return to us the Confirmation at the end of the handbook
indicating that you have received, read and understood it.

       

      Your
employment with the Company is not of a set duration. Termination of this Offer
of Employment Letter by either party will require two months notice and must be
provided in accordance with applicable law.

       

      As a
condition of your employment, you are required to sign our Non-Disclosure,
Non-Solicitation, Non-Competition and Inventions Agreement, which is provided as
part of this Offer of Employment Letter.

       

       

      
        
          224 West
35th
Street, Suite 1004, N.Y., NY 10001, U.S.A. Tel (212) 500-4899 Fax (212)
500-4888

          Jerusalem
Technology Park, P.O.B. 48265, Jerusalem, Israel, Tel 972-2-649-1222 Fax
9722-649-1200

        

      

      
        
          
          

        

        
          Page 4 of
6

          
            

          

        

        
          
          

        

      

       

      
         

        
          	
                   

                	
                   

                
	
                   

                
	 	 


        

         

      

      If the
terms and conditions set forth above are acceptable to you, please so indicate
by signing below.

       

      Welcome
to the Company.

       

      DELTA THREE ISRAEL,
LTD.

       

       

      /s/ Merav
Carmeli 

        
          

        

      

      Merav
Carmeli

      Human
Resources Manager

       

       

       

      /s/ Arie
Rand 

        
          

        

      

      Arie
Rand

       

       

       

      
        
          224 West
35th
Street, Suite 1004, N.Y., NY 10001, U.S.A. Tel (212) 500-4899 Fax (212)
500-4888

          Jerusalem
Technology Park, P.O.B. 48265, Jerusalem, Israel, Tel 972-2-649-1222 Fax
9722-649-1200

        

      

      
        
          
          

        

        
          Page 5 of
6

          
            

          

        

        
          
          

        

      

       

      
         

        
          	
                   

                	
                   

                
	
                   

                
	 	 


        

         

      

      APPENDIX
A

      


      General
Authorization (Combined Version) Regarding Employee Payments to a Pension Fund
and Insurance Fund in Lieu of Severance Pay

      In Accordance with the
Severance Pay Law 5723-1963

      


      


      By virtue
of my authority under Section 14 of the Severance Pay Law 5723-1963
(hereinafter, “The Law”), I hereby confirm that payments made by an employer
beginning on the date this authorization is publicized,  for its
employee, for a comprehensive pension in a provident fund for benefit payments,
which is not an insurance fund as implied in the Income Tax Regulations (Rules
for Approving and Managing Provident Funds) 5724-1964 (hereinafter, “A Pension
Fund”); or for manager’s insurance that includes an option for benefit payments
or a combination of payments into a benefits scheme and a non-benefits scheme in
the said insurance fund (hereinafter, “Insurance Fund”), including payments that
were made as a combination of payments to a Pension Fund and an Insurance Fund,
whether or not the Insurance Fund has a benefits scheme (hereinafter, “Employer
Payments”), shall be in lieu of the severance pay to which the said employee is
entitled against the wages from which the said payments were paid and the period
for which they were paid (hereinafter, “The Exempted Salary”), and provided the
following conditions shall be  present:

      


      
        	
                1.

              	
                Employer payments
      –

              


      

      
        	
                (A)

              	
                to
      a Pension Fund are not less than 14 1/3% of the Exempted Salary, or 12% of
      the Exempted Salary if the employer pays for his employee, in addition to
      this, supplementary severance payments into a severance pay fund or an
      Insurance Fund under the name of the employee, at a rate of 2 1/3% of the
      Exempted Salary.  If, in addition to the 12%, the employer does
      not pay the said 2 1/3%, his payments shall be only in lieu of the 72% of
      the employee’s severance pay.

              


      

      


      
        	
                (B)

              	
                to
      an Insurance Fund are not less than one of the
  following:

              


      

      
        	
                (1)

              	
                13
      1/3% of the Exempted Salary, if the employer pays for its employee
      additional monthly income supplement benefits in the case of an employee’s
      inability to work, through a plan approved by the Supervisor for Capital
      Markets, Insurance and Savings in the Ministry of Finance, at a rate
      necessary to guarantee at least 75% of the Exempted Salary, or at a rate
      of 2 1/2% of the Exempted Salary, whichever is lower (hereinafter,
      “Payment for  the Loss of  Ability to Work
      Insurance”);

              


      

      


      
        	
                (2)

              	
                11%
      of the Exempted Salary, if the employer paid  an additional
      payment for the Loss of  Ability to Work Insurance, and in such
      case the employer’s payments shall be in lieu of 72% of the employee’s
      severance compensation only; if, in addition to such payments, the
      employer has also paid payments for the supplement of severance pay to a
      Severance Pay Fund or an Insurance Fund under the name of the employee at
      a rate of 2 1/3% of the Exempted Salary, the employer’s payments shall be
      in lieu of 100% of the employee’s severance
pay.

              


      

      


      
        	
                2.

              	
                Not
      later than three months from the commencing of the performance of the
      employer’s payments a written agreement shall be prepared between the
      employer and the employee, which shall
include:

              


      

      
        	
                (A)

              	
                The
      employee’s agreement to an arrangement in accordance with this
      authorization, in wording that specifies the employer’s payments and the
      Pension Fund and the Insurance Fund, as relevant; the said agreement shall
      also include the wording of this
authorization;

              


      

      


      
        	
                (B)

              	
                The
      employer’s prior waiver of any right he may have to a financial
      reimbursement from his payments, unless the employee’s right to severance
      pay is rescinded by a judicial decree, by virtue of paragraphs 16 or 17 of
      the Law, and if rescinded or that the employee withdrew funds from the
      Pension Fund or from the Insurance Fund not for a qualifying incident; in
      this regard, a “qualifying incident” – death, disability or retirement at
      the age of 60 or older.

              


      

      


      
        	
                (C)

              	
                This
      authorization shall not derogate from the employee’s right to severance
      pay under the law, collective agreement, and expansion order or employment
      contract, for wages exceeding the Exempted
  Salary.

              


      

      


       

      


      (-)

      Eliyahu
Yishai

      Minister
of Labor and Social Affairs

       

       

       

      
        
          224 West
35th
Street, Suite 1004, N.Y., NY 10001, U.S.A. Tel (212) 500-4899 Fax (212)
500-4888

          Jerusalem
Technology Park, P.O.B. 48265, Jerusalem, Israel, Tel 972-2-649-1222 Fax
9722-649-1200

           

          Page 6 of 6