Exhibit 10.9

                              EMPLOYMENT AGREEMENT


     THIS EMPLOYMENT  AGREEMENT (this "Agreement"),  made and entered into as of
July 1, 2004, by and between NETWOLVES CORPORATION, a New York corporation, with
its principal office located at 4805 W. Independence Parkway,  Suite 101, Tampa,
FL 33634-7511  (together with its successors  and assigns  permitted  under this
Agreement,  "NetWolves") and WALTER M. GROTEKE ("Groteke"),  amends and restates
in its entirety the  original  agreement  made and entered into as of October 1,
2000 between NetWolves and Groteke ("Prior Agreement"), except for equity issued
and the  cumulative  effect  of  cost-of-  living  adjustments  under  the prior
agreement which shall remain in full force and effect.

                                   WITNESSETH:

     WHEREAS,  NetWolves  has  determined  that it is in the best  interests  of
NetWolves and its stockholders to continue to employ Groteke and to set forth in
this Agreement the obligations and duties of both NetWolves and Groteke; and

     WHEREAS,  NetWolves  wishes to assure itself of the services of Groteke for
the period  hereinafter  provided,  and  Groteke is  willing to be  employed  by
NetWolves  for said  period,  upon the terms  and  conditions  provided  in this
Agreement;

     NOW,  THEREFORE,  in  consideration  of the premises  and mutual  covenants
contained herein and for other good and valuable  consideration,  the receipt of
which is mutually  acknowledged,  NetWolves and Groteke  (individually a "Party"
and together the "Parties") agree as follows:

     1. DEFINITIONS.

     (a)  "Beneficiary"  shall  mean the  person  or  persons  named by  Groteke
pursuant  to Section 16 below or, in the event that no such  person is named who
survives Groteke, his estate.

     (b) "Board" shall mean the Board of Directors of NetWolves.

     (c) "Cause" shall mean:

     (i) Groteke's conviction of a felony involving an act or acts of dishonesty
on his part and  resulting or intended to result  directly or indirectly in gain
or personal enrichment at the expense of NetWolves;

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     (ii) willful and  continued  failure of Groteke to perform his  obligations
under this  Agreement,  resulting  in  demonstrable  material  economic  harm to
NetWolves, or

     (iii) a material  breach by Groteke of the  provisions of Sections 13 or 14
below to the demonstrable and material detriment of NetWolves.

     Notwithstanding  the  foregoing,  in no event  shall  Groteke's  failure to
perform the duties associated with his position caused by his mental or physical
disability constitute Cause for his termination.

     For purposes of this Section  1(c), no act or failure to act on the part of
Groteke shall be considered  "willful" unless it is done, or omitted to be done,
by him in bad faith or without reasonable belief that his action or omission was
in the best  interests  of  NetWolves.  Any act or  failure  to act  based  upon
authority given pursuant to a resolution  adopted by the Board or based upon the
advice of counsel for NetWolves  shall be  conclusively  presumed to be done, or
omitted  to be done,  by  Groteke  in good  faith and in the best  interests  of
NetWolves.

     (d) "Change in Control"  shall mean the  occurrence of any of the following
events:

     (i) the acquisition by any individual,  entity or group (within the meaning
of Section  13(d)(3)  or  14(d)(2)  of the  Securities  Exchange  Act of 1934 as
amended (the "Exchange  Act") (a "Person") of beneficial  ownership  (within the
meaning of Rule 13d-3  promulgated  under the Exchange Act) of voting securities
of NetWolves when such acquisition  causes such Person to own 30 percent or more
of the  combined  voting  power of the then  outstanding  voting  securities  of
NetWolves  entitled  to  vote  generally  in  the  election  of  directors  (the
"Outstanding NetWolves Voting Securities"); provided, however, that for purposes
of this subsection (i), the following acquisitions shall not be deemed to result
in a Change of Control:  (A) any acquisition  directly from  NetWolves,  (B) any
acquisition by NetWolves,  (C) any acquisition by any employee  benefit plan (or
related  trust)   sponsored  or  maintained  by  NetWolves  or  any  corporation
controlled by NetWolves or (D) any  acquisition  pursuant to a transaction  that
complies with clauses (A), (B) and (C) of subsection  (iii) below; and provided,
further,  that if any Person's beneficial ownership of the Outstanding NetWolves
Voting  Securities  reaches or  exceeds 30 percent as a result of a  transaction
described  in clause (A) or (B) above,  and such  Person  subsequently  acquires
beneficial  ownership  of  additional  voting  securities  of  NetWolves,   such
subsequent  acquisition  shall be treated as an  acquisition  that  causes  such
Person to own 30 percent or more of the Outstanding NetWolves Voting Securities;
or

     (ii)  individuals  who, as of the date  hereof,  constitute  the Board (the
"Incumbent Board") cease for any reason to constitute at least a majority of the

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Board; provided,  however, that any individual becoming a director subsequent to
the date hereof  whose  election,  or  nomination  for  election  by  NetWolves'
stockholders,  was  approved by a vote of at least a majority  of the  directors
then  comprising  the  Incumbent  Board  shall  be  considered  as  though  such
individual were a member of the Incumbent  Board, but excluding for this purpose
any such individual whose initial  assumption of office occurs as a result of an
actual or threatened election contest with respect to the election or removal of
directors or other actual or threatened  solicitation  of proxies or consents by
or on behalf of a Person other than the Board; or

     (iii) consummation of a reorganization,  merger or consolidation or sale or
other  disposition of all or subsequently  all of the assets of NetWolves or the
acquisition of assets of another  entity  ("Business  Combination");  excluding,
however,  such a Business Combination pursuant to which (A) all or substantially
all of the  individuals  and  entities  who were the  beneficial  owners  of the
Outstanding  NetWolves  Voting  Securities  immediately  prior to such  Business
Combination  beneficially own, directly or indirectly,  more than 60 percent of,
respectively,  the then  outstanding  shares  of common  stock and the  combined
voting  power  of the  then  outstanding  voting  securities  entitled  to  vote
generally in the election of directors,  as the case may be, of the  corporation
resulting  from such Business  Combination  (including,  without  limitation,  a
corporation  that as a  result  of such  transaction  owns  NetWolves  or all or
substantially  all of NetWolves'  assets either  directly or through one or more
subsidiaries)  in  substantially   the  same  proportions  as  their  ownership,
immediately  prior to such Business  Combination  of the  Outstanding  NetWolves
Voting  Securities,  (B) no Person  (excluding  any  employee  benefit  plan (or
related  trust) of NetWolves or such  corporation  resulting  from such Business
Combination)  beneficially owns, directly or indirectly,  30 percent or more of,
respectively,  the then  outstanding  shares of common stock of the  corporation
resulting  from such Business  Combination  or the combined  voting power of the
then outstanding voting securities of such corporation except to the extent that
such  ownership  existed  prior to the Business  Combination  and (C) at least a
majority of the members of the board of directors of the  corporation  resulting
from such Business  Combination  were members of the Incumbent Board at the time
of the  execution  of the  initial  agreement,  or of the  action of the  Board,
providing for such Business Combination; or

     (iv) approval by the stockholders of NetWolves of a complete liquidation or
dissolution of the Company.

     (e) "Code"  shall mean the Internal  Revenue Code of 1986,  as amended from
time to time.

     (f) "Committee" shall mean the Compensation Committee of the Board.

     (g)  "Disability"  shall  mean the  illness  or other  mental  or  physical
disability of Groteke, as determined by a physician  acceptable to NetWolves and
Groteke,  resulting in his failure  during the  Employment  Term, (i) to perform
substantially  his applicable  material duties under this Agreement for a period

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of nine  consecutive  months and (ii) to return to the performance of his duties
within 30 days after receiving written notice of termination.

     (h)  "Employment  Term"  shall mean the period  specified  in Section  2(b)
below.

     (i) "Fiscal  Year" shall mean the 12-month  period  beginning on July 1 and
ending on the next  subsequent  June 30, or such  other  12-month  period as may
constitute NetWolves's fiscal year at any time hereafter.

     (j) "Good  Reason"  shall  mean,  at any time during the  Employment  Term,
without Groteke's prior written consent or his acquiescence:

     (i) reduction in his then current Salary;

     (ii)  diminution,  reduction  or  other  adverse  change  in the  bonus  or
incentive compensation  opportunities  available to Groteke (with respect to the
level of bonus opportunities,  the applicable performance criteria and otherwise
the  manner  in which  bonuses  are  determined)  in the  aggregate  from  those
available as of the date hereof in accordance with Section 4(a) below;

     (iii)  NetWolves's  failure to pay Groteke any amounts otherwise vested and
due him hereunder or under any plan or policy of NetWolves;

     (iv)   diminution   of   Groteke's   titles,   position,   authorities   or
responsibilities, including not serving on the Board;

     (v) assignment to Groteke of duties incompatible with his position of Chief
Executive Officer;

     (vi)  termination by Groteke of his employment  within one year following a
Change in Control  other than (a) by mutual  agreement,  (b) for Cause or (c) by
reason of Retirement, death or Disability;

     (vii)  imposition of a requirement  that Groteke report other than directly
to the full Board;

     (viii) a material  breach of the  Agreement by NetWolves  that is not cured
within 10 business days after written notification by Groteke of such breach; or

     (ix)  relocation of NetWolves'  corporate  headquarters  to a location more
than 50 miles  from the  location  first  above  described  or 50 miles from the
current location of Netwolves' Tampa, Florida facility.

     (k) "Salary" shall mean the annual salary  provided for in Section 3 below,

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as adjusted from time to time.

     (l) "Spouse" shall mean, during the Term of Employment, the woman who as of
any relevant date is legally married to Groteke.

     (m)  "Subsidiary"  shall  mean any  corporation  of which  NetWolves  owns,
directly or indirectly, more than 50 percent of its voting stock.


     2. EMPLOYMENT TERM, POSITIONS AND DUTIES.

     (a) Employment of Groteke.  NetWolves  hereby  continues to employ Groteke,
and Groteke hereby accepts continued employment with NetWolves, in the positions
and with the duties  and  responsibilities  set forth  below and upon such other
terms and conditions as are hereinafter stated. Groteke shall render services to
NetWolves  principally at NetWolves's  corporate  headquarters,  but he shall do
such  traveling on behalf of NetWolves  as shall be  reasonably  required in the
course  of the  performance  of his  duties  hereunder,  including  to its Tampa
facility.

     (b) Employment  Term. The Employment Term shall commence on the date hereof
and shall terminate on June 30, 2010.

     (c) Titles and Duties.

     (i) Until the date of  termination  of his  employment  hereunder,  Groteke
shall be employed as Chief  Executive  Officer,  reporting to the full Board. In
his  capacity  as Chief  Executive  Officer,  Groteke  shall have the  customary
powers,   responsibilities  and  authorities  of  chief  executive  officers  of
corporations  of the size,  type and  nature  of  NetWolves  including,  without
limitation, authority, in conjunction with the Board as appropriate, to hire and
terminate other employees of NetWolves.

     (ii) During the Employment  Term,  NetWolves shall uses its best efforts to
secure the  election  of Groteke to the Board and to the  chairmanship  thereof.
During  the  Employment  Term,  if the  Board  forms  an  executive  or  similar
committee, Groteke shall serve thereon.

     (d) Time and Effort.

     (i) Groteke  agrees to devote his best efforts and  abilities,  and such of
his business time and attention as is  reasonably  necessary,  to the affairs of
NetWolves  in order to carry out his  duties  and  responsibilities  under  this
Agreement.

     (ii) Notwithstanding the foregoing, nothing shall preclude Groteke from (A)
serving on the boards of a reasonable number of trade  associations,  charitable
organizations and/or businesses not in competition with NetWolves,  (B) engaging

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in charitable  activities  and  community  affairs and (C) managing his personal
investments  and  affairs;  provided,  however,  that,  such  activities  do not
materially   interfere   with  the   proper   performance   of  his  duties  and
responsibilities specified in Section 2 (c) above.

     3. SALARY.

     (a) Initial Salary.  Groteke shall receive from NetWolves a Salary, payable
in accordance  with the regular  payroll  practices of  NetWolves,  in a minimum
amount of $275,000.

     (b)  Cost-of-Living  Increase.  During the Employment Term Groteke's Salary
shall be increased  semiannually  by an amount equal to the increase in the cost
of living for the immediately  preceding calendar half-year,  as reported in the
"Consumer  Price  Index,  New York and  Northeastern  New  Jersey,  All  Items,"
published by the United States  Department of Labor,  Bureau of Labor Statistics
(or, if such index is no longer published,  a successor or comparable index that
is  published).  Such amount shall be  cumulative  commencing  2000 and shall be
calculated and paid to Groteke in a single sum on or before the first day of the
second month  following the  applicable  calendar half year,  and thereafter his
Salary  shall be deemed to include  the amount of any such  increase.  The first
calculation and payment under this agreement shall be made on or before February
1, 2000 with respect to the period October 1, 2000 through December 31, 2000. If
Groteke's  employment  shall  terminate  during any such six-month  period,  the
cost-of-living  increase  provided  in  this  Section  3(b)  shall  be  prorated
accordingly.

     (c) Salary Increase. Any amount to which Groteke's Salary is increased,  as
provided in Section 3(b) above or  otherwise,  shall not  thereafter  be reduced
without his consent, and the term "Salary" as used in this Agreement shall refer
to his Salary as thus increased.

     4. BONUSES.

     Groteke  shall  be  eligible  to  receive  additional  bonuses  during  the
Employment Term. NetWolves Corporation shall determine,  in its discretion,  the
occasion for payment, and the amount, of any such bonus.

     5. LONG-TERM INCENTIVE.

     During the  Employment  Term,  Groteke shall be eligible for an award under
any long- term  incentive  compensation  plan  established  by NetWolves for the
benefit of Groteke or, in the absence  thereof,  under any such plan established
for the benefit of members of the senior management of NetWolves.

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     6. EQUITY OPPORTUNITY.

     During the Employment Term,  Groteke shall be eligible to receive grants of
options  to  purchase  shares  of  NetWolves's  stock  and  awards  of shares of
NetWolves's stock,  either or both as determined by the Committee,  under and in
accordance  with the terms of applicable  plans of NetWolves and related  option
and award agreements. It is the intention of NetWolves to grant stock options to
Groteke during the Employment Term.

     7. EXPENSE REIMBURSEMENT; CERTAIN OTHER COSTS.

     During  the   Employment   Term,   Groteke  shall  be  entitled  to  prompt
reimbursement by NetWolves for all reasonable out-of-pocket expenses incurred by
him in performing  services  under this  Agreement,  upon his submission of such
accounts and records as may be reasonably required by NetWolves.

     8. PERQUISITES.

     During the  Employment  Term,  NetWolves  shall  provide  Groteke  with the
following perquisites:

     (a) an office of a size and with  furnishings and other  appointments,  and
exclusive  personal  secretarial  and other  assistance,  at least equal to that
provided to Groteke by NetWolves as of the date hereof; and

     (b) the use of an  automobile  and payment of related  expenses on the same
terms as in effect on the date hereof or, if more favorable to Groteke,  as made
available  generally to other executive officers of NetWolves and its affiliates
at any time thereafter.

     9. EMPLOYEE BENEFIT PLANS.

     (a)  General.  During the  Employment  Term,  Groteke  shall be entitled to
participate  in all  employee  benefit  plans and  programs  made  available  to
NetWolves's  senior executives or to its employees  generally,  as such plans or
programs  may be in effect  from time to time,  including,  without  limitation,
pension and other retirement plans,  profit-sharing  plans,  savings and similar
plans,  group life  insurance,  accidental  death and  dismemberment  insurance,
travel accident insurance,  hospitalization insurance, surgical insurance, major
and excess major medical insurance,  dental insurance,  short-term and long-term
disability insurance,  sick leave (including salary continuation  arrangements),
holidays, vacation (not less than four weeks in any calendar year) and any other
employee  benefit plans or programs that may be sponsored by NetWolves from time
to time,  including  plans  that  supplement  the  above-listed  types of plans,
whether funded or unfunded.

     (b) Medical Care  Reimbursement and Insurance.  During the Employment Term,
NetWolves  shall  reimburse  Groteke  for 100  percent of any  medical  expenses
incurred  by him for  himself,  his  Spouse,  or  immediate  family that are not

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reimbursed  by  insurance  or   otherwise,   offset  by  any  amounts  that  are
reimbursable  by Medicare if Groteke and his Spouse and immediate  family,  when
eligible,  elect to be covered by Medicare.  NetWolves shall provide Groteke and
his  Spouse  and  immediate  family  during his  lifetime  with  hospitalization
insurance,  surgical  insurance,  major and excess major  medical  insurance and
dental insurance in accordance with the most favorable plans, policies, programs
and  practices of NetWolves and its  Subsidiaries  made  available  generally to
other senior  executive  officers of NetWolves and its Subsidiaries as in effect
from time to time.

     (c) Life  Insurance  Benefit.  In  addition  to the  group  life  insurance
available  to  employees  generally,  NetWolves  shall  provide  Groteke with an
individual  permanent  life  insurance  benefit in an initial amount of not less
than  approximately  $5 million,  the terms and conditions of such benefit to be
more fully  described in an insurance  ownership  agreement  between Groteke and
NetWolves.

     (d) Disability  Benefit. In consideration of the benefit payable to Groteke
in the event of termination of his employment due to Disability,  as provided in
Section 10(d) below,  NetWolves  shall not be obligated to provide  Groteke with
long-term disability insurance. If NetWolves elects to provide Groteke with such
insurance,  he shall be the owner of any individual  policies obtained and shall
pay the premiums  thereon;  provided,  however,  that NetWolves  shall reimburse
Groteke for any premiums that he pays.

     10. TERMINATION OF EMPLOYMENT.

     (a) Voluntary Termination and Termination by Mutual Agreement.  Groteke may
terminate his employment voluntarily at any time. If he does so, his entitlement
shall be the same as if NetWolves had terminated  his employment for Cause.  The
Parties may terminate this Agreement by mutual agreement at any time. If they do
so, Groteke's entitlements shall be as the Parties mutually agree.

     (b) General.  Notwithstanding anything to the contrary herein, in the event
of  termination  of  Groteke's  employment  under  this  Agreement,  he  or  his
Beneficiary,  as the case may be,  shall be entitled to receive (in  addition to
payments and benefits under, and except as specifically provided in, subsections
(c) through (i) below, as applicable):

     (i) his Salary through the date of termination;

     (ii) any unused vacation from prior years;

     (iii) any bonus awarded but not yet paid to him;

     (iv) any other compensation or benefits, including without limitation long-
term incentive  compensation described in Section 5 above, benefits under equity
grants and awards described in Section 6 above and employee benefits under plans
described in Section 9 above,  that have vested  through the date of termination

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or to which he may then be entitled in accordance with the applicable  terms and
conditions of each grant, award or plan; and

     (v)  reimbursement  in  accordance  with Sections 9(a) and (b) above of any
business  and medical  expenses  incurred by Groteke or his Spouse or  immediate
family, as applicable, through the date of termination but not yet paid to him.

     (c)  Termination  due to Death.  In the event that Groteke's  employment is
terminated due to his death, his Beneficiary  shall be entitled,  in addition to
the compensation and benefits  specified in Section 10(b), to his Salary payable
for the  remainder  of the  Employment  Term at the rate in  effect  immediately
before such termination.

     (d) Termination due to Disability. In the event of Disability, NetWolves or
Groteke  may  terminate  Groteke's   employment.   If  Groteke's  employment  is
terminated  due  to  Disability,  he  shall  be  entitled,  in  addition  to the
compensation and benefits  specified in Section 10(b), to his Salary payable for
the remainder of the Employment  Term at the rate in effect  immediately  before
such  termination,  offset by any long-term  disability  insurance  benefit that
NetWolves may have elected to provide for him.

     (e) Termination by NetWolves for Cause.  NetWolves may terminate  Groteke's
employment hereunder for Cause only upon written notice to Groteke not less than
30 days prior to any  intended  termination,  which  notice  shall  specify  the
grounds for such  termination in reasonable  detail.  Cause shall in no event be
deemed to exist except upon a finding  reflected  in a resolution  approved by a
majority  (excluding  Groteke) of the members of the Board (whose findings shall
not be binding  upon or entitled to any  deference by any court,  arbitrator  or
other  decision-maker  ruling on this  Agreement)  at a meeting of which Groteke
shall have been given proper notice and at which Groteke (and his counsel) shall
have a reasonable  opportunity  to present his case. In the event that Groteke's
employment  is  terminated  for  Cause,   he  shall  be  entitled  only  to  the
compensation and benefits specified in Section 10(b).

     (f) Termination Without Cause or by Groteke for Good Reason.

     (i)  Termination   without  Cause  shall  mean   termination  of  Groteke's
employment  by  NetWolves  and  shall  exclude  termination  (A)  due to  death,
Disability or Cause,  (B) by Groteke  voluntarily or (C) by mutual  agreement of
Groteke and NetWolves.  NetWolves  shall provide  Groteke 15 days' prior written
notice of termination by it without Cause,  and Groteke shall provide  NetWolves
15 days' prior written notice of his termination for Good Reason.

     (ii) In the event of  termination  by  NetWolves  of  Groteke's  employment
without Cause or of termination by Groteke of his employment for Good Reason, he
shall be entitled,  in addition to the  compensation  and benefits  specified in
Section 10(b), to:

     (A) his Salary,  payable for the  remainder of the  Employment  Term at the

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rate in effect immediately before such termination;

     (B) annual  bonuses for the remainder of the Employment  Term  (including a
prorated  bonus for any partial  Fiscal  Year) equal to the average of the three
highest annual bonuses  awarded to him during the ten Fiscal Years preceding the
Fiscal  Year of  termination,  such  bonuses to be paid at the same time  annual
bonuses are regularly paid by NetWolves to Groteke;

     (C) continued  medical  reimbursement  for the remainder of the  Employment
Term and  thereafter  the lifetime  medical  benefits  described in Section 9(b)
above;

     (D)  continued  participation  in all  employee  benefit  plans or programs
available to NetWolves employees generally in which Groteke was participating on
the date of termination of his employment  until the end of the Employment Term;
provided;  however,  that  (x) if  Groteke  is  precluded  from  continuing  his
participation in any employee benefit plan or program as provided in this clause
(E), he shall be entitled to the after-tax  economic  equivalent of the benefits
under the plan or program in which he is unable to participate  until the end of
the  Employment  Term, and (y) the economic  equivalent of any benefit  foregone
shall be deemed to be the lowest cost that Groteke would incur in obtaining such
benefit on an individual basis; and

     (E) other benefits in accordance with applicable  plans and programs of the
Company . (iii) Prior written consent by Groteke to any of the events  described
in Section  1(k) above shall be deemed a waiver by him of his right to terminate
for Good  Reason  under this  Section  10(f)  solely by reason of the events set
forth in such waiver.

     (g) Voluntary Termination by Groteke. Groteke shall have the right, upon 60
days' prior written notice, voluntarily to terminate his employment without Good
Reason,  in which event his employment shall cease and the Employment Term shall
terminate  as of the date  stated in such  notice,  and he shall be  entitled to
receive  compensation and benefits as if NetWolves had terminated his employment
for Cause, as provided in Section 10(e).

     (h) Change in Control.  Notwithstanding  anything  to the  contrary in this
Section 10,  termination  of Groteke's  employment  within the  one-year  period
following a Change in Control for any reason other than Cause, Retirement, death
or  Disability,  shall be  governed by Section  10(g).  In the event of any such
termination,   Groteke  shall  be  entitled  to  compensation  and  benefits  in
accordance with the provisions of Section 10(f)(ii).

     11. NO DUTY TO MITIGATE.

     Groteke  shall not be  required  to  mitigate  damages or the amount of any
payment  provided  for under this  Agreement  by  seeking  other  employment  or
otherwise,  nor will any  payment  hereunder  be  subject to offset in the event
Groteke does receive compensation for services from any other source.


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    12.  PARACHUTES.

     (a)  Application.  If all, or any portion,  of the payments  provided under
this Agreement,  and/or any other payments and benefits that Groteke receives or
is entitled to receive from  NetWolves or a Subsidiary,  whether or not under an
existing plan, arrangement or other agreement,  constitutes an excess "parachute
payment"  within the meaning of Section 280G(b) of the Code (each such parachute
payment, a "Parachute  Payment") and will result in the imposition on Groteke of
an excise tax under  Section  4999 of the Code,  then,  in addition to any other
benefits to which Groteke is entitled under this Agreement,  NetWolves shall pay
him an amount in cash  equal to the sum of the  excise  taxes  payable by him by
reason of receiving Parachute Payments,  plus the amount necessary to put him in
the same after-tax position (taking into account any and all applicable federal,
state and local excise, income or other taxes at the highest possible applicable
rates on such  Parachute  Payments  (including  without  limitation any payments
under this  Section 12) as if no excise  taxes had been  imposed with respect to
Parachute Payments (the "Parachute Gross-up").

     (b)  Computation.  The amount of any payment under this Section 12 shall be
computed by a certified public accounting firm of national  reputation  selected
by NetWolves  and  acceptable to Groteke.  If NetWolves or Groteke  disputes the
computation  rendered  by  such  accounting  firm,  NetWolves  shall  select  an
alternative  certified public accounting firm of national  reputation to perform
the applicable  computation.  If the two accounting  firms cannot agree upon the
computations,  Groteke and  NetWolves  shall jointly  appoint a third  certified
public accounting firm of national  reputation within 10 calendar days after the
two  conflicting  computations  have been rendered.  Such third  accounting firm
shall be asked to  determine  within 30  calendar  days the  computation  of the
Parachute  Gross-up  to  be  paid  to  Groteke,   and  payments  shall  be  made
accordingly.

     (c)  Payment.  In any event,  NetWolves  shall pay to Groteke or pay on his
behalf the  Parachute  Gross-up  as computed by the  accounting  firm  initially
selected  by  Groteke  by the time any taxes  payable  by him as a result of the
Parachute Payments become due, with Groteke agreeing to return the excess amount
of such payment over the final  computation  rendered from the process described
in Section 12(b).  Groteke and NetWolves shall provide the accounting firms with
all information  that any of them reasonably deems necessary in order to compute
the  Parachute  Gross-up.  The cost and  expenses  of all the  accounting  firms
retained  to  perform  the  computations  described  above  shall  be  borne  by
NetWolves.

     In the event that the Internal  Revenue  Service  ("IRS") or the accounting
firm  computing the Parachute  Gross-up  finally  determines  that the amount of
excise taxes thereon  initially  paid was  insufficient  to discharge  Groteke's
excise tax liability,  NetWolves shall make additional payments to him as may be
necessary to reimburse him for discharging the full liability.

     Groteke  shall  apply to the IRS for a refund of any excise  taxes paid and
remit to  NetWolves  the amount of any such refund that he  receives.  NetWolves
shall reimburse Groteke for his expenses in seeking a refund of excise taxes and
for any  interest and  penalties  imposed on excise taxes that he is required to
pay.

                                       11
<PAGE>
     13. CONFIDENTIAL INFORMATION.

     (a) General.

     (i) Groteke  understands  and hereby  acknowledges  that as a result of his
employment with NetWolves he will necessarily become informed of and have access
to certain  valuable and  confidential  information  of NetWolves and any of its
Subsidiaries,  joint ventures and  affiliates,  including,  without  limitation,
inventions,   trade  secrets,  technical  information,   computer  software  and
programs,  know-how and plans  ("Confidential  Information"),  and that any such
Confidential Information,  even though it may be developed or otherwise acquired
by Groteke,  is the  exclusive  property of NetWolves to be held by him in trust
solely for NetWolves's benefit.

     (ii)  Accordingly,  Groteke hereby agrees that,  during the Employment Term
and  subsequent  to both,  he shall not,  and shall not cause  others  to,  use,
reveal,  report,  publish,   transfer  or  otherwise  disclose  to  any  person,
corporation or other entity any Confidential  Information  without prior written
consent  of the Board,  except to (A)  responsible  officers  and  employees  of
NetWolves  or (B)  responsible  persons who are in a  contractual  or  fiduciary
relationship  with  NetWolves or who need such  information  for purposes in the
interest of NetWolves.  Notwithstanding, the foregoing, the prohibitions of this
clause  (ii) shall not apply to any  Confidential  Information  that  becomes of
general public  knowledge  other than from Groteke or is required to be divulged
by court order or administrative process.

     (b) Return of Documents.  Upon termination of his employment with NetWolves
for any reason, Groteke shall promptly deliver to NetWolves all plans, drawings,
manuals,  letters,  notes,  notebooks,  reports,  computer  programs  and copies
thereof and all other materials,  including without limitation those of a secret
or confidential  nature,  relating to NetWolves's  business that are then in his
possession or control.

     (c)  Remedies  and  Sanctions.  In the event that Groteke is found to be in
violation of Section 13(a) or (b) above,  NetWolves  shall be entitled to relief
as provided in Section 15 below.

     14. NONCOMPETITION/NONSOLICITATION.

     (a)  Prohibitions.  During the Employment Term,  Groteke shall not, without
prior written  authorization of the Board,  directly or indirectly,  through any
other individual or entity:

     (i) become on officer or employee  of, or render any service to, any direct
competitor  of  NetWolves,  which  shall be define as any  business  engaged  in
Internet Security;

     (ii) solicit or induce any customer of NetWolves to cease  purchasing goods
or  services  from  NetWolves  or to  become a  customer  of any  competitor  of
NetWolves;  or

                                       12
<PAGE>
     (iii) solicit or induce any employee of NetWolves to become employed by any
competitor of NetWolves.

     (b)  Remedies  and  Sanctions.  In the event that Groteke is found to be in
violation  of Section  14(a)  above,  NetWolves  shall be  entitled to relief as
provided in Section 15 below.

     (c) Exceptions.  Notwithstanding  anything to the contrary in Section 14(a)
above, its provisions shall not:

     (i) apply if NetWolves  terminates  Groteke's  employment  without Cause or
Groteke  terminates his employment for Good Reason,  each as provided in Section
10(f) above;

     (ii) be construed as  preventing  Groteke from  investing his assets in any
business that is not a direct competitor of NetWolves; or


     15. REMEDIES/SANCTIONS.

     Groteke acknowledges that the services he is to render under this Agreement
are of a unique and  special  nature,  the loss of which  cannot  reasonably  or
adequately be compensated for in monetary damages,  and that irreparable  injury
and damage may result to NetWolves in the event of any breach of this  Agreement
or  default  by  Groteke.  Because  of the  unique  nature  of the  Confidential
Information  and the  importance of the  prohibitions  against  competition  and
solicitation, Groteke further acknowledges and agrees that NetWolves will suffer
irreparable harm if he fails to comply with his obligations  under Section 13(a)
or (b)  above  or  Section  14(a)  above  and  that  monetary  damages  would be
inadequate to compensate  NetWolves  for any such breach.  Accordingly,  Groteke
agrees that, in addition to any other remedies available to either Party at law,
in equity or otherwise,  NetWolves will be entitled to seek injunctive relief or
specific  performance to enforce the terms,  or prevent or remedy the violation,
of any provisions of this Agreement.

     16. BENEFICIARIES/REFERENCES.

     Groteke  shall be entitled to select (and change,  to the extent  permitted
under  any  applicable  law) a  beneficiary  or  beneficiaries  to  receive  any
compensation  or benefit  payable  under this  Agreement  following his death by
giving NetWolves written notice thereof.  In the event of Groteke's death, or of
a judicial  determination  of his  incompetence,  reference in this Agreement to
Groteke shall be deemed to refer, as appropriate, to his beneficiary,  estate or
other legal representative.

                                       13
<PAGE>
     17. WITHHOLDING TAXES.

     All payments to Groteke or his  Beneficiary  under this Agreement  shall be
subject to withholding on account of federal,  state and local taxes as required
by law.

     18. INDEMNIFICATION AND LIABILITY INSURANCE.

     Nothing herein is intended to limit NetWolves's indemnification of Groteke,
and NetWolves shall indemnify him to the fullest extent  permitted by applicable
law consistent with NetWolves's  Certificate of Incorporation  and By-Laws as in
effect at the beginning of the  Employment  Term,  with respect to any action or
failure to act on his part  while he is an  officer,  director  or  employee  of
NetWolves or any Subsidiary.  NetWolves shall cause Groteke to be covered at all
times by directors' and officers' liability insurance on terms no less favorable
than the directors' and officers' liability insurance maintained by NetWolves in
effect on the date  hereof in terms of coverage  and  amounts.  NetWolves  shall
continue to  indemnify  Groteke as provided  above and maintain  such  liability
insurance  coverage for him after the Employment Term for any claims that may be
made  against  him with  respect  to his  service  as a  director  or officer of
NetWolves or a consultant to NetWolves.

     19. EFFECT OF AGREEMENT ON OTHER BENEFITS.

     The existence of this  Agreement  shall not prohibit or restrict  Groteke's
entitlement to participate  fully in  compensation,  employee  benefit and other
plans of NetWolves in which senior executives are eligible to participate.

     20. ASSIGNABILITY; BINDING NATURE.

     This  Agreement  shall be  binding  upon and  inure to the  benefit  of the
Parties and their  respective  successors,  heirs (in the case of  Groteke)  and
assigns.  No rights or  obligations  of NetWolves  under this  Agreement  may be
assigned  or  transferred  by  NetWolves  except  pursuant  to (a) a  merger  or
consolidation  in which  NetWolves is not the  continuing  entity or (b) sale or
liquidation  of all or  substantially  all of the assets of NetWolves,  provided
that the  surviving  entity or assignee or transferee is the successor to all or
substantially  all of the  assets  of  NetWolves  and such  surviving  entity or
assignee  or  transferee  assumes  the  liabilities,  obligations  and duties of
NetWolves under this Agreement, either contractually or as a matter of law.

     NetWolves  further  agrees  that,  in the  event  of a sale  of  assets  or
liquidation  as  described  in the  preceding  sentence,  it shall  use its best
efforts  to have such  assignee  or  transferee  expressly  agree to assume  the
liabilities,  obligations and duties of NetWolves hereunder;  provided, however,
that  notwithstanding  such  assumption,   NetWolves  shall  remain  liable  and
responsible for  fulfillment of the terms and conditions of this Agreement;  and
provided, further, that in no event shall such assignment and assumption of this
Agreement adversely affect Groteke's right upon a Change in Control, as provided
in Section

10(i) above.  No rights or  obligations  of Groteke under this  Agreement may be

                                       14
<PAGE>

assigned or transferred by him.

     21. REPRESENTATIONS.

     The  Parties  respectively   represent  and  warrant  that  each  is  fully
authorized and empowered to enter into this  Agreement and that the  performance
of its or his  obligations,  as the case may be, under this  Agreement  will not
violate  any  agreement  between  such  Party  and  any  other  person,  firm or
organization.  NetWolves  represents  and warrants that this  Agreement has been
duly  authorized by all  necessary  corporate  action and is valid,  binding and
enforceable in accordance with its terms.

     22. ENTIRE AGREEMENT.

     Except to the extent otherwise provided herein, this Agreement contains the
entire  understanding and agreement  between the Parties  concerning the subject
matter hereof and  supersedes  any prior  agreements,  whether  written or oral,
between the Parties  concerning  the subject matter  hereof,  including  without
limitation  the Prior  Agreement.  Payments  and  benefits  provided  under this
Agreement  are in lieu of any  payments or other  benefits  under any  severance
program or policy of NetWolves to which Groteke would otherwise be entitled.

     23. AMENDMENT OR WAIVER.

     No  provision in this  Agreement  may be amended  unless such  amendment is
agreed to in writing  and signed by both  Groteke and an  authorized  officer of
NetWolves.  No waiver by either  Party of any  breach by the other  Party of any
condition or provision contained in this Agreement to be performed by such other
Party shall be deemed a waiver of a similar or dissimilar condition or provision
at the same or any prior or subsequent  time.  Any waiver must be in writing and
signed by the Party to be charged  with the waiver.  No delay by either Party in
exercising  any right,  power or privilege  hereunder  shall operate as a waiver
thereof.

     24. SEVERABILITY.

     In the event  that any  provision  or portion  of this  Agreement  shall be
determined to be invalid or unenforceable  for any reason,  in whole or in part,
the remaining provisions of this Agreement shall be unaffected thereby and shall
remain in full force and effect to the fullest extent permitted by law.

     25. SURVIVAL.

     The respective  rights and  obligations of the Parties under this Agreement
shall survive any termination of Groteke's employment with NetWolves.

                                       15
<PAGE>
     26. GOVERNING LAW/JURISDICTION.

     This  Agreement  shall be  governed by and  construed  and  interpreted  in
accordance  with  the laws of New  York,  without  reference  to  principles  of
conflict of laws.

     27. COSTS OF DISPUTES.

     NetWolves  shall pay, at least monthly,  all costs and expenses,  including
attorneys' fees and disbursements, of Groteke in connection with any proceeding,
whether or not instituted by NetWolves or Groteke,  relating to any provision of
this Agreement, including but not limited to the interpretation,  enforcement or
reasonableness  thereof;  provided,  however,  that, if Groteke  instituted  the
proceeding and the judge or other  decision-maker  presiding over the proceeding
affirmatively finds that his claims were frivolous or were made in bad faith, he
shall pay his own costs and  expenses  and,  if  applicable,  return any amounts
theretofore  paid to him or on his behalf  under this  Section  27.  Pending the
outcome of any  proceeding,  NetWolves  shall pay Groteke all amounts due to him
without regard to the dispute; provided, however, that if NetWolves shall be the
prevailing party in such a proceeding,  Groteke shall promptly repay all amounts
that he received during pendency of the proceeding.

     28. NOTICES.

     Any notice given to either Party shall be in writing and shall be deemed to
have been given when delivered either personally,  by fax, by overnight delivery
service  (such as Federal  Express)  or sent by  certified  or  registered  mail
postage prepaid, return receipt requested, duly addressed to the Party concerned
at the  address  indicated  below or to such  changed  address  as the Party may
subsequently give notice of.

If to NetWolves or the Board:

    NetWolves Corporation
    4002 Eisenhower Blvd., Suite 101
    Tampa, Florida 33634
    FAX:  (813) 286-8644

With a copy to:

    Beckman, Lieberman & Barandes, LLP
    100 Jericho Quadrangle
    Suite 329
    Jericho, New York  11753
    Attn:  David H. Lieberman, Esq.

                                       16
<PAGE>

If to Groteke:

    Walter M. Groteke
    2731 Via Capri, Apt. 919
    Grand Venezia
    Clearwater, Florida 33764

     29. HEADINGS.

     The  headings  of  the  sections   contained  in  this  Agreement  are  for
convenience  only and shall not be deemed to control  or affect  the  meaning or
construction of any provision of this Agreement.

     30. COUNTERPARTS.

     This  Agreement  may be  executed  in  counterparts,  each of which when so
executed and delivered shall be an original,  but all such counterparts together
shall constitute one and the same instrument.

     IN WITNESS WHEREOF,  the undersigned have executed this Agreement as of the
date first written above.

                                        NETWOLVES CORPORATION


                                        By: /s/ Peter C. Castle
                                            -------------------------------
                                                   Peter C. Castle
                                               Chief Financial Officer



                                             /s/ Walter M. Groteke
                                            -------------------------------
                                                  Walter M. Groteke
                                                      Employee



                                       17