Document:

Exhibit 4.6

 

2012 EQUITY COMPENSATION PLAN

 

Section 1. Purpose

 

The 2012 Equity Compensation
Plan (the “Plan”) is hereby established to foster and promote the long-term success of North Jersey Community Bancorp,
Inc. (the “Company”), the holding company of North Jersey Community Bank (the “Bank”), and its shareholders
by providing members of management, including employees and management officials, with an equity interest in the Company. The Plan
will assist the Company in attracting and retaining the highest quality of experienced persons to serve as employees and Directors
and in aligning the interests of such persons more closely with the interests of the Company’s shareholders by encouraging
such parties to maintain an equity interest in the Company.

 

Section 2. Definitions

 

Capitalized terms not
specifically defined elsewhere herein shall have the following meaning:

 

“Act” means
the Securities Exchange Act of 1934, as amended from time to time, and any rules and regulations promulgated thereunder.

 

“Award”
means the grant of Options, Restricted Stock or Performance Units hereunder.

 

“Board”
means the Board of Directors of the Company.

 

“Change
in Control” means any of the following:

 

 (1) a
reorganization, merger, consolidation or sale of all or substantially all of the assets of the Company, or any similar transaction,
in any case in which the shareholders of the Company prior to such transaction hold less than a majority of the voting power of
the resulting entity; or

 

 (2) individuals
who constitute the Incumbent Board of the Company cease for any reason to constitute a majority thereof.

 

“Code” means
the Internal Revenue Code of 1986, as amended from time to time, and the regulations promulgated thereunder.

 

“Committee”
means the Compensation Committee of the Board, or such successor committee of the Board undertaking the responsibilities currently
exercised by the Compensation Committee. Each member of the Committee shall at all times qualify as a “Non-Employee Director”
within the meaning of SEC Rule 16b-3(b)(3) and an “outside director” within the meaning of Regulation 1.162-27 under
Code Section 162(m).

    	 

    	

    

“Common Stock”
or “Stock” means the common stock, no par value per share, of the Company.

 

“Company”
means North Jersey Community Bancorp, Inc. and any present or future subsidiary or parent corporations of North Jersey Community
Bancorp, Inc. (as defined in Section 424 of the Code) or any successor to such corporations.

 

“Disability”
shall mean the Participant’s inability for a period of three (3) consecutive months, or for six (6) months during any twelve
(12) month period, to perform the requirements of the Participant’s position with the Company due to physical or mental impairment;
provided, however, with respect to a Participant who has been granted an Incentive Stock Option such term shall have the meaning
set forth in Section 422(c)(6) of the Code. For purposes of Restricted Stock Awards under Section 8, “Disability” shall
be as defined in Section 8.3(a)(1). The determination of whether a Disability exists will be made by the Committee.

 

“Eligible Shares
has the meaning ascribed in Section 5(a)

 

“Fair Market Value”
means, with respect to shares of Common Stock, the fair market value as determined by the Committee in good faith and in a manner
established by the Committee from time to time, taking into account such factors as the Committee shall deem relevant, including
the book value of the Common Stock and, to the extent the Common Stock is traded on a national securities exchange, the Fair Market
Value of the Common Stock shall be the closing price of the Common Stock on the date the Fair Market Value is determined.

 

“Incentive Stock
Option” means an option to purchase shares of Common Stock granted to a Participant under the Plan which is intended to meet
the requirements of Section 422 of the Code.

 

“Incumbent Board”
means the Board of Directors of the Company on the date of stockholders approval of this Plan, provided that any person becoming
a director subsequent to such date whose election was approved by a vote of at least three quarters of the directors comprising
the Incumbent Board, or whose nomination for election by stockholders was approved by the same nominating committee serving under
an Incumbent Board, shall be considered as though such individual were a member of the Incumbent Board.

 

“Management Official”
means an employee of the Company, a non-employee member of the Board, a member of any advisory committee or any other service provider
to the Company.

 

“Non-Qualified
Stock Option” means an option to purchase shares of Common Stock granted to a Participant under the Plan which is not intended
to be an Incentive Stock Option.

 

“Option”
means an Incentive Stock Option or a Non-Qualified Stock Option

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granted hereunder.

 

“Participant”
means a Management Official selected by the Committee to receive an Award under the Plan.

 

“Performance Cycle
or Cycle” means the period selected by the Committee during which the performance of the Company is measured for the purpose
of determining the extent to which an award of Performance Units has been earned. Applicable performance goals relating to each
Performance Cycle shall be established not later than the earlier of (1) 90 days after the beginning of any performance period
applicable to such Performance Units or (2) the time 25% of such performance period has elapsed.

 

“Performance Goals”
means the objectives established by the Committee for a Performance Cycle, for the purpose of determining and measuring the extent
to which Performance Units, which have been contingently awarded for such Cycle, have been earned. For purposes of qualifying Awards
intended by the Committee to be exempt under Code Section 162(m) and regulations thereunder, the Committee may use one or more
of the following as Performance Goals: (1) earnings or earnings growth; (2) earnings per share; (3) return on equity, assets, capital
employed or investment; (4) revenues or revenue growth; (5) gross profit; (6) gross margin; (7) net income or net income per common
share; (8) operating margin; (9) operating cash flow; (10) stock price appreciation and total shareholder return, (11) economic
profit or value created, (12) interest expense, (13) strategic business criteria, (14) efficiency ratio, (15) growth in assets,
loan and/or deposits, (16) net interest margin, (17) loan production volume, (18) asset quality, including net charge offs, levels
of classified assets and non-performing loan levels, (19) interest rate risk sensitivity, (21) capital compliance, or any combination
of any of the forgoing. Targeted level or levels of performance with respect to such business criteria may be established at such
levels and in such terms as the Committee may determine, in its discretion, including in absolute terms, as a goal relative to
performance in prior periods, or as a goal compared to the performance of one or more comparable companies or an index covering
multiple companies. Performance Goals may be particular to a Participant, the Company, subsidiary or other business segment of
the Company, or may be based on the performance of the Company as a whole.

 

“Performance Units
or Units” means a fixed or variable dollar or Common Stock share denominated Unit contingently awarded under Section 9 of
the Plan.

 

“Plan” means
the 2012 Equity Compensation Plan.

 

“Restricted Stock
Award” means a grant of shares of Common Stock pursuant to Section 8 hereof.

 

“SEC” means
the Securities and Exchange Commission.

 

“Termination for
Cause” means termination because of Participant’s intentional

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failure to perform stated duties, personal
dishonesty, willful violation of any law, rule regulation (other than traffic violations or similar offenses) or final cease and
desist order issued by any regulatory agency having jurisdiction over the Participant or the Company.

 

Section 3. Administration

 

 (a)  The Plan shall be administered
by the Committee. Among other things, the Committee shall have authority, subject to the terms of the Plan, to grant Awards, to
determine the type of Award granted, to determine the individuals to whom and the time or times at which Awards may be granted,
to determine whether Options are to be Incentive Options or Non-Qualified Stock Options (subject to the requirements of the Code,
which provide that only employees may receive Incentive Options), to determine the terms and conditions of any Award granted hereunder,
including whether to impose any vesting period, and if the Award is an Option, the exercise price thereof, subject to the requirements
of this Plan.

 

 (b) Subject to the other provisions
of the Plan, the Committee shall have authority to adopt, amend, alter and repeal such administrative rules, guidelines and practices
governing the operation of the Plan as it shall from time to time consider advisable, to interpret the provisions of the Plan and
any Award and to decide all disputes arising in connection with the Plan. The Committee may correct any defect or supply any omission
or reconcile any inconsistency in the Plan or in any grant agreement in the manner and to the extent it shall deem appropriate
to carry the Plan into effect, in its sole and absolute discretion. The Committee’s decision and interpretations shall be
final and binding. Any action of the Committee with respect to the administration of the Plan shall be taken pursuant to a majority
vote or by the unanimous written consent of its members.

 

 (c) The Committee may employ such
legal counsel, consultants and agents as it may deem desirable for the administration of the Plan and may rely upon any opinion
received from any such counsel or consultant and any computation received from any such consultant or agent.

 

Section 4. Eligibility and Participation

 

Management Officials
of the Company shall be eligible to participate in the Plan. The Participants under the Plan shall be selected from time to time
by the Committee, in its sole discretion, from among those eligible, and the Committee shall determine in its sole discretion the
numbers of shares to be covered by the Award or Awards granted to each Participant. Options intended to qualify as Incentive Stock
Options shall be granted only to persons who are eligible to receive such options under Section 422 of the Code; i.e., employees
of the Company.

 

Section 5. Shares of Stock Available
for Awards

 

 (a) The maximum number of shares
of Common Stock or equivalents which may be issued under the Plan is 125,000 subject to the adjustments as provided in this Section
5

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and Section 10, to the extent applicable;
provided, however, that on January 1st of each year that the Plan is in effect, the number of shares of Common Stock
or equivalents which may be issued under the Plan shall automatically increase such that the number of shares issued and eligible
for issuance under this Plan, when combined with the number of shares of Common Stock issued or eligible for issuance under all
other equity compensation plans of the Company then in effect (“Eligible Shares”), will equal 10% of the Company’s
then issued and outstanding shares of Common Stock. If the number of Eligible Shares exceeds 10% of the Company’s issued
and outstanding shares of Common Stock on any such January 1st, then there will be no adjustment to the number of shares
or share equivalents which may be issued under this Plan. If an Award granted under this Plan expires or terminates before exercise
or is forfeited for any reason, without a payment in the form of Common Stock being granted to the Participant, the shares of Common
Stock subject to such Award, to the extent of such expiration, termination or forfeiture, shall again be available for subsequent
Award grant under the Plan.

 

 (b) In the event that any stock
dividend, stock split, reverse stock split or combination, extraordinary cash dividend, creation of a class of equity securities,
recapitalization, reclassification, reorganization, merger, consolidation, split-up, spin-off, combination, exchange of shares,
warrants or rights offering to purchase Common Stock at a price substantially below Fair Market Value, or other similar transaction
affects the Common Stock such that an adjustment is required in order to preserve the benefits or potential benefits intended to
be granted or made available under the Plan to Participants, the Committee shall proportionately and appropriately adjust equitably
any or all of (i) the maximum number and kind of shares of Common Stock in respect of which Awards may be granted under the Plan
to Participants, (ii) the number and kind of shares of Common Stock subject to outstanding Options held by Participants, and (iii)
the exercise price with respect to any Options held by Participants, without changing the aggregate purchase price as to which
such Options remain exercisable, and if considered appropriate, the Committee may make provision for a cash payment with respect
to any outstanding Options held by a Participant, provided that no adjustment shall be made pursuant to this Section if such adjustment
would cause the Plan to fail to comply with Section 422 of the Code with regard to any Incentive Stock Options granted hereunder
or fail to comply with the requirements of Rule 16b-3 under the Act or any successor or replacement regulation. No fractional Shares
shall be issued on account of any such adjustment.

 

 (c) Any adjustments under this Section
will be made by the Committee, whose determination as to what adjustments, will be made and the extent thereof will be final, binding
and conclusive.

 

Section 6. Non-Qualified Stock Options

 

 6.1 Grant of Non-Qualified Stock
Options.

 

Subject to the provisions
hereof, the Committee may, from time to time, grant Non-Qualified Stock Options to Participants upon such terms and conditions
as the Committee may determine, and may grant Non-Qualified Stock Options in exchange for and upon surrender

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of previously granted Options under this
Plan. Non-Qualified Stock Options granted under this Plan are subject to the following terms and conditions:

 

 (a) Price. The purchase price
per share of Common Stock deliverable upon the exercise of each Non-Qualified Stock Option shall be determined by the Committee
on the date the option is granted. The purchase price shall not be less than one hundred percent (100%) of the Fair Market Value
of the Common Stock on the date of grant. Shares may be purchased only upon full payment of the purchase price.

 

 (b) Terms of Options. The
term during which each Non-Qualified Stock Option may be exercised shall be determined by the Committee, but in no event shall
a Non-Qualified Stock Option be exercisable in whole or in part more than ten (10) years from the date of grant.

 

 (c) Termination of Service.
Except as provided herein, unless otherwise determined by the Committee, upon the termination of the service of a Participant who
is not an employee for any reason other than Disability, death or Termination for Cause, the Participant’s Non-Qualified
Stock Options shall be exercisable only as to those shares which were immediately exercisable by the participant at the date of
termination and only for one (1) year from the date of such termination. In the event of death or termination of service of a Participant
who is not an employee as a result of Disability of the Participant, all Non-Qualified Stock Options held by the Participant, whether
or not exercisable at such time, shall be exercisable by the Participant or his legal representatives, or beneficiaries of the
Participant for one (1) year from the date of such termination. Upon the termination of the service of a Participant who is a common
law employee of the Company for any reason other than Disability, death or Termination for Cause, the Participant’s Non-Qualified
Stock Options shall be exercised only as to those shares which were immediately exercisable by the Participant at the date of termination
and only for a period of three (3) months following termination. In the event of death or termination of service of a Participant
who is a common law employee of the Company as a result of Disability of any such Participant, all Non-Qualified Stock Options
held by such Participant, whether or not exercisable at such time, shall be exercisable by the Participant or his legal representatives
or beneficiaries of the Participant for one (1) year or such longer period as is determined by the Committee following the date
of the Participant’s death or termination of service due to Disability, provided that in no event shall the period extend
beyond the expiration of the Non-Qualified Stock Option term. Notwithstanding any other provisions set forth herein to the contrary
nor any provision contained in any agreement relating to the award of an option, in the event of a Termination for Cause, all of
the Participant’s Non-Qualified Stock Options shall immediately expire upon such Termination for Cause and shall not be exercisable,
regardless of whether such Non-Qualified Stock Options were vested.

 

(d) Transferability.
Except as provided for hereunder, no Option granted under the Plan shall be assignable or transferable by a Participant, and any
attempted disposition thereof shall be null and void and of no effect. Nothing contained herein shall be deemed to prevent transfers
by will or by the applicable laws of descent and distribution.

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Section 7. Incentive Stock Options

 

 7.1 Grant of Incentive Stock
Options.

 

The Committee may, from
time to time, grant Incentive Stock Options to Management Officials who are employees of the Company. Incentive Stock Options granted
pursuant to the Plan shall be subject to the following terms and conditions:

 

 (a) Price. The purchase price
per share of Common Stock deliverable upon the exercise of each Incentive Stock Option shall be not less than one hundred percent
(100%) of the Fair Market Value of the Common Stock on the date of grant or the par value of the Common Stock, whichever is higher.
However, if a Participant owns stock possessing more than ten percent (10%) of the total combined voting power of all classes of
Common Stock, the purchase price per share of Common Stock deliverable upon the exercise of each Incentive Stock Option shall not
be less than one hundred ten percent (110%) of the Fair Market Value of the Common Stock on the date of grant or the par value
of the Common Stock, whichever is greater. Shares may be purchased only upon payment of the full purchase price.

 

 (b) Amounts of Options. Incentive
Stock Options may be granted to any Management Official who is an employee of the Company in such amounts as determined by the
Committee. In the case of an option intended to qualify as an Incentive Stock Option, the aggregate Fair Market Value (determined
as of the time the option first becomes exercisable) of the Common Stock with respect to which Incentive Stock Options granted
are exercisable for the first time by the Participant during any calendar year shall not exceed $100,000. The provisions of this
Section 7.1(b) shall be construed and applied in accordance with Section 422(d) of the Code and the regulations, if any, promulgated
thereunder. To the extent an award is in excess of such limit, it shall be deemed a Non-Qualified Stock Option. The Committee shall
have discretion to redesignate options granted as Incentive Stock Options as Non-Qualified Options.

 

 (c) Terms of Options. The
term during which each Incentive Stock Option may be exercised shall be determined by the Committee, but in no event shall an Incentive
Stock Option be exercisable in whole or in part more than ten (10) years from the date of grant. If at the time an Incentive Stock
Option is granted to an employee, the employee owns Common Stock representing more than ten percent (10%) of the total combined
voting power of the Company (or, under Section 422(d) of the Code, is deemed to own Common Stock representing more than ten percent
(10%) of the total combined voting power of all such classes of Common Stock, by reason of the ownership of such classes of Common
Stock, directly or indirectly, by or for any brother, sister, spouse, ancestor or lineal descendent of such employee, or by or
for any corporation, partnership, estate or trust of which such employee is a shareholder, partner or beneficiary), the Incentive
Stock Option granted to such employee shall not be exercisable after the expiration of five (5) years from the date of grant.

 

 (d) Termination of Service.
Except as provided in Section 7.1(e) hereof, upon

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the termination of a Participant’s
service for any reason other than Disability, death or Termination for Cause, the Participant’s Incentive Stock Options which
are then exercisable at the date of termination may only be exercised by the Participant for a period of three (3) months following
termination. Notwithstanding any provisions set forth herein nor contained in any Agreement relating to an award of an Option,
in the event of Termination for Cause all rights under the Participant’s Incentive Stock Options shall expire immediately
upon termination, and such Incentive Stock Options shall not be exercisable.

 

Unless otherwise determined
by the Committee, in the event of death or termination of service as a result of Disability of any Participant, all Incentive Stock
Options held by such Participant, whether or not exercisable at such time, shall be exercisable by the Participant or the Participant’s
legal representatives or beneficiaries of the Participant for one (1) year following the date of the participant’s death
or termination of employment as a result of Disability. In no event shall the exercise period extend beyond the expiration of the
Incentive Stock Option term.

 

 (e) Transferability. No Incentive
Option granted under the Plan shall be assignable or transferable by a Participant, except pursuant to the laws of descent and
distribution, and any attempted distribution shall be null and void and of no effect.

 

 (f) Compliance with Code.
The options granted under this Section 7 of the Plan are intended to qualify as incentive stock options within the meaning of Section
422 of the Code, but the Company makes no warranty as to the qualification of any option as an incentive stock option within the
meaning of Section 422 of the Code. A Participant shall notify the Committee in writing in the event that he disposes of Common
Stock acquired upon exercise of an Incentive Stock Option within the two-year period following the date the Incentive Stock Option
was granted or within the one-year period following the date he received Common Stock upon the exercise of an Incentive Stock Option
and shall comply with any other requirements imposed by the Company in order to enable the Company to secure the related income
tax deduction to which it will be entitled in such event under the Code.

 

Section 8. Restricted Stock

 

 8.1 Grant of Restricted Stock Awards

 

 (a) Grants. The Committee
may grant Restricted Stock Awards entitling recipients to acquire shares of Common Stock, subject to the right of the Company to
require forfeiture of such shares from the Participant in the event that conditions specified by the Committee in the applicable
Restricted Stock Award are not satisfied prior to the end of the applicable restriction period or periods established by the Committee
for such Restricted Award. During the restricted period, shares constituting a Restricted Stock Award may not be transferred, although
a Participant shall be entitled to exercise other indicia of ownership, including the right to vote such shares and receive any
dividends declared on such shares.

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 (b) Terms
and Conditions. Subject to Section 8.2, the Committee shall determine the terms and conditions of any such Restricted Stock
Award, including the conditions for forfeiture.

 

(c) Stock Certificates.
The Company may cause shares issued as part of a Restricted Stock Award to be issued in either book entry form or certificated
form. Shares issued in book entry form will be maintained in an account at the Company’s transfer agent, and only released
to a Participant upon satisfaction of any required restrictions. Any stock certificates issued in respect of a Restricted Stock
Award shall be registered in the name of the Participant and, unless otherwise determined by the Committee, deposited by the Participant,
together with a stock power endorsed in blank, with the Company (or its designee). At the expiration of the applicable restriction
periods, the Company (or such designee) shall deliver the certificates no longer subject to such restrictions to the Participant
or if the Participant has died, to the beneficiary designated, in a manner determined by the Committee, by a Participant to receive
amounts due or exercise rights of the Participant in the event of the Participant’s death (the “Designated Beneficiary”).
In the absence of an effective designation by a Participant, Designated Beneficiary shall mean the Participant’s estate.

 

8.2 Distribution of Restricted Stock Awards

 

(a) Restricted Stock Awards shall not be distributed and the restrictions pertaining to such award shall not expire earlier
than –

 

(1) upon the completion or satisfaction of the conditions specified by the Committee in the Award;

 

 (2) a Participant’s separation from service;

 

(3) the date a Participant becomes disabled (as defined in Section 8.3(b));

 

(4) upon the death of a Participant;

 

(5) a change in the ownership or effective control of the Company, or in the ownership of a substantial portion of the assets
of the Company, as described in Section 10(c) or, if in conflict therewith, to the extent necessary, by the Secretary of Treasury
under regulations issued under Code section 409A; or

 

(6) upon the occurrence of an unforeseeable emergency.

 

(b) A payment of a Participant’s vested interest in a Restricted Stock Award may, in the discretion of the Committee,
be made in the event of a Participant’s Disability, upon

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the occurrence of a Change-in-Control or
Unforeseeable Emergency (as defined below). Payments in settlement of a Participant’s vested interest in a Restricted Stock
Award shall be made as soon as practicable after such occurrence or after the Participant otherwise vests in such award. For the
purposes of section 409A of the Code, the entitlement to a series of installment payments will be treated as the entitlement to
a single payment.

 

 (c) Other provisions of the Plan
notwithstanding, if, upon the written application of a Participant, the Committee determines that the Participant has an unforeseeable
emergency (as defined in Section 8.3(b)), the Committee may, in its sole discretion, direct the payment to the Participant of all
or a portion of the balance of his or her vested interest in a Restricted Stock Award in a lump sum payment, provided that any
such withdrawal shall be limited by the Committee to the amount reasonably necessary to meet the emergency, including amounts needed
to pay any income taxes or penalties reasonably anticipated to result from the payment. No payment may be made to the extent that
such emergency is or may be relieved through reimbursement or compensation from insurance or otherwise, by liquidation of the Participant’s
assets or to the extent the liquidation of such assets would not cause severe financial hardship.

 

(d) The Committee may not otherwise permit the acceleration of the time or schedule of any vesting of a Restricted Stock
award scheduled to be paid pursuant to the Plan, unless such acceleration of the time or schedule is (i) necessary to fulfill a
domestic relations order (as defined in section 414(p)(1)(B) of the Code) or to comply with a certificate of divestiture (as defined
in section 1043(b)(2) of the Code), (ii) de minimis in nature (as defined in regulations promulgated under section 409A of the
Code), (iii) to be used for the payment of FICA taxes on amounts deferred under the Plan, or (iv) equal to amounts included in
the federal personal taxable income of the Participant under section 409A of the Code.

 

 

 

 8.3 Definitions for Restricted
Stock Awards

 

(a) For purposes of this Section 8, the
following definitions shall apply-

 

(1) “Disability” shall mean (i) the inability of a Participant to engage in any substantial gainful activity by reason
of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last
for a continuous period of not less than twelve (12) months, or (ii) if the Participant is, by reason of any medically determinable
physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not
less than twelve (12) months, receiving income replacement benefits for a period of not less than three (3) months under an accident
and health plan covering employees of the Company.

 

(2) “Unforeseeable Emergency” shall mean a severe financial hardship to the Participant resulting from an illness
or accident of the Participant, the Participant’s spouse, or a dependent (as defined in Code section 152(a)) of the Participant,
loss of the Participant’s

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property due to casualty, or other similar
extraordinary and unforeseeable circumstances arising as a result of events beyond the control of the Participant.

 

Section 9. Performance Units

 

9.1
 Authority of Committee

 

Subject to the provisions of the Plan, the
Committee shall have sole and complete authority to determine (i) the Participants who shall receive Performance Units and the
number of Units awarded for each Performance Cycle; (ii) the duration of each Performance Cycle; and (iii) the value of or valuation
methodology for each Performance Unit. Performance Units may be denominated in fixed or variable dollar amounts, or may be made
equal to one or more shares of Common Stock. There may be more than one Performance Cycle in existence at any one time, and the
duration of such Performance Cycles may differ, as determined by the Committee.

 

9.2  Performance
Goals

 

The Committee shall
establish Performance Goals for each Cycle on the basis of such criteria and to accomplish such objectives as the Committee may
from time to time select. During any Cycle, the Committee may adjust the Performance Goals for such Cycle as it deems equitable
in recognition of unusual or non-recurring events affecting the Corporation or changes in applicable tax laws or accounting principles;
provided however, that no such adjustment shall be made with respect to Awards intended by the Committee to qualify as exempt under
Code Section 162(m) if such adjustment would result in the loss of such exemption.

 

9.3  Terms and
Conditions

 

The Committee shall
determine the number of Performance Units that have been earned on the basis of the Company’s performance in relation to
the established Performance Goals. Performance Units may not be sold, assigned, transferred, pledged or otherwise encumbered, except
as herein provided, during the Performance Cycle. Payment for Performance Units shall be in cash or shares of Common Stock, in
such proportions as the Committee shall determine.

 

9.4  Termination

 

A Participant must
be a Management Official at the end of a Performance Cycle to be entitled to payment of Performance Units in respect of such Cycle;
provided, however, that in the event a Participant ceases to be a Management Official with the Committee’s consent before
the end of such Cycle, or upon the occurrence of a Participant’s death or Disability prior to the end of such Cycle, the
Committee, in its discretion and after taking into consideration the performance of such Participant and the performance of the
Company during the Cycle, may authorize payment to such Participant (or the Participant’s legal representative) of all or
a portion of the Performance Units deemed by the Committee to have been earned by the Participant through the date of termination.

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Section 10. Extension

 

The Committee may, in
its sole discretion, extend the dates during which all or any particular Option or Options granted under the Plan may be exercised;
provided, however, that no such extension shall be permitted if it would cause Non-Qualified Stock Options or Incentive Stock Options
issued under the Plan to fail to comply with Section 409A or 422 of the Code. An election to defer the lapse of restrictions on
a Restricted Stock Award shall not take effect until at least twelve (12) months after the date on which the election is made and
in the event that an election to defer the lapse of restrictions is made other than in the event of death, disability or the occurrence
of an unforeseeable emergency, payment of such award must be deferred for a period of not less than five (5) years from the date
that restrictions would have otherwise lapsed. Nothing contained in this provision, or elsewhere in this Plan, shall be construed
to provide the Committee with authority to change the exercise price of any Award, other than in connection with any adjustment
provided for under Section 5(b) hereof, or such changes as may be approved by the Company’s shareholders.

 

Section 11. General Provisions Applicable
to Awards

 

 (a) Each Award under the Plan shall
be evidenced by a writing delivered to the Participant specifying the terms and conditions thereof and containing such other terms
and conditions not inconsistent with the provisions of the Plan as the Committee considers necessary or advisable to achieve the
purposes of the Plan or comply with applicable tax and regulatory laws and accounting principles.

 

 (b) Each Award may be granted alone,
in addition to or in relation to any other Award. The terms of each Award need not be identical, and the Committee need not treat
Participants uniformly. Except as otherwise provided by the Plan or a particular Award, any determination with respect to an Award
may be made by the Committee at the time of grant or at any time thereafter.

 

 (c) In the event of a consolidation,
reorganization, merger or sale of all or substantially all of the assets of the Company, in each case in which outstanding shares
of Common Stock are exchanged for securities, cash or other property of any other corporation or business entity or in the event
of a liquidation of the Company, the Committee will provide for any one or more of the following actions, as to outstanding Awards:
(i) provide that such Awards shall be assumed, or equivalent Awards shall be substituted, by the acquiring or succeeding corporation
(or an affiliate thereof), provided that any options substituted for Incentive Stock Options shall meet the requirements of Section
424(a) of the Code, (ii) upon written notice to the Participants, provide that all unexercised Options will terminate immediately
prior to the consummation of such transaction unless exercised (to the extent then exercisable) by the Participant within a specified
period following the date of such notice, (iii) in the event of a merger under the terms of which holders of the Common Stock of
the Company will receive upon consummation thereof a cash payment for each share surrendered in the merger

    	-12-

    	

    

(the “Merger Price”), make
or provide for a cash payment to the Participants equal to the difference between (A) the Merger Price times the number of shares
of Common Stock subject to outstanding Options (to the extent then exercisable at prices not in excess of the Merger Price) and
(B) the aggregate exercise price of all such outstanding Options in exchange for the termination of such Options, or (iv) provide
that all or any outstanding Awards shall become exercisable in full, or that the restrictions on such Awards shall lapse, immediately
prior to such event.

 

 (d) For purposes of the Plan, the
following events shall not be deemed a termination of service of a Participant:

 

 (i) a
transfer to the employment of the Company from a subsidiary or from the Company to a subsidiary, or from one subsidiary to another,
or

 

 (ii) an
approved leave of absence for military service or sickness, or for any other purpose approved by the Company, if the Participant’s
right to reemployment is guaranteed either by a statute or by contract or under the policy pursuant to which the leave of absence
was granted or if the Committee otherwise so provides in writing.

 

 (e) The Committee may at any time,
and from time to time, amend, modify or terminate the Plan or any outstanding Award held by a Participant, including substituting
therefore another Award of the same or a different type or changing the date of exercise or realization, provided that the Participant’s
consent to each action shall be required unless the Committee determines that the action, taking into account any related action,
would not materially and adversely affect the Participant, and further provided that no amendment increasing the number of shares
subject to the Plan or decreasing the exercise price for any Option provided for under the Plan may be effectuated without the
approval of the shareholders of the Company; provided, however, that no such amendment or modification will be effective if such
amendment or modification would cause the Plan to fail to comply with the requirements of Rule 16b-3 under the Act or any successor
or replacement regulation.

 

 (f) The Committee may, in its sole
discretion, terminate the Plan (in whole or in part) with respect to one or more Participants and distribute to such affected Participants
their vested interest in any Restricted Stock award in a lump sum as soon as reasonably practicable following such termination,
but if, and only if, (i) all nonqualified defined contribution deferred compensation plans maintained by the Company and its Affiliates
are terminated, (ii) no payments other than payments that would be payable under the terms of the Plan if the termination had not
occurred are made within twelve (12) months of the termination of the Plan, (iii) all payments of the vested interest in Restricted
Stock awards are made within twenty-four (24) months of the termination of the Plan, and (iv) the Company acknowledges to the Participants
that it will not adopt any new nonqualified defined contribution deferred compensation plans at any time within five (5) years
following the date of the termination of the Plan.

    	-13-

    	

    

Section 12. Miscellaneous

 

 (a) No person shall have any claim
or right to be granted an Award, and the grant of an Award shall not be construed as giving a Participant the right to continued
employment or service on the Company’s Board. The Company expressly reserves the right at any time to dismiss a Participant
free from any liability or claim under the Plan, except as expressly provided in the applicable Award.

 

 (b) Nothing contained in the Plan
shall prevent the Company from adopting other or additional compensation arrangements.

 

 (c) Subject to the provisions of
the applicable Award, no Participant shall have any rights as a shareholder (including, without limitation, any rights to receive
dividends, or non-cash distributions with respect to such shares) with respect to any shares of Common Stock to be distributed
under the Plan until he or she becomes the holder thereof.

 

 (d) Notwithstanding anything to
the contrary expressed in this Plan, any provisions hereof that vary from or conflict with any applicable Federal or State securities
laws (including any regulations promulgated thereunder) shall be deemed to be modified to conform to and comply with such laws.

 

 (e) No member of the Committee shall
be liable for any action or determination taken or granted in good faith with respect to this Plan nor shall any member of the
Committee be liable for any agreement issued pursuant to this Plan or any grants under it. Each member of the Committee shall be
indemnified by the Company against any losses incurred in such administration of the Plan, unless his action constitutes serious
and willful misconduct.

 

 (f) Awards may not be granted under
the Plan more than ten (10) years after approval of the Plan by the Company’s shareholders, but then outstanding Awards may
extend beyond such date.

 

 (h) To the extent that State laws
shall not have been preempted by any laws of the United States, the Plan shall be construed, regulated, interpreted and administered
according to the other laws of the State of New Jersey.

 

 (i) A Participant in the Plan shall
have no right to receive payment (in any form) with respect to his or her restricted Stock award until legal and contractual obligations
of the Company relating to establishment of the Plan and the making of such payments shall have been complied with in full. In
addition, the Company shall impose such restrictions on stock delivered to a Participant hereunder and any other interest constituting
a security as it may deem advisable in order to comply with the Securities Act of 1933, as amended, the requirements of

    	-14-

    	

    

any stock exchange or automated quotation
system upon which the stock is then listed or quoted, any applicable state securities laws, any provision of the Company’s
certificate of incorporation or bylaws, or any other law, regulation, or binding contract to which the Company is a party.

    	-15-exh_1038.htm

Exhibit 10.38

 

FOURTH AMENDMENT TO EMPLOYMENT AGREEMENT

This Fourth Amendment (“Amendment”) to the Employment Agreement by and between NetSol Technologies, Inc. (“Netsol” or the “Company”) and Najeeb Ghauri (“Executive”), dated June 30, 2014 (the “Employment Agreement”) is entered into as of the date indicated below.  Other than the specific amendments enumerated in the Amendment, all of the terms of the Employment Agreement shall remain in the full force and effect, and shall not be obviated or affected by this Amendment.

In the event of a conflict between the terms of this Amendment and the Employment Agreement, the terms of this Amendment shall govern.  All capitalized terms contained herein are, unless otherwise stated, as defined in the Agreement.

Now therefore, for good and valuable consideration, the sufficiency of which is hereby acknowledged, the parties agree as follows:

Section 1.1 shall be modified to read:

1.1 The Company hereby enters into this Agreement with Executive, and Executive hereby accepts employment under the terms and conditions set forth in this Agreement for a period of five years thereafter (the “Employment Period”); provided, however, that the Employment Period may be terminated earlier as provided herein.  The Employment Period shall be automatically extended for additional one-year periods unless either party notifies the other in writing six months before the end of the anniversary year to elect not to so extend the Employment Period or by mutual agreement of the parties.

Section 3.1 of the Employment Agreement is modified to read:

3.1 The Company shall increase, effective July 1, 2014, Executive’s base salary to Four Hundred Ninety Seven Thousand Seven Hundred Dollars ($497,700) per year (the "Base Salary"), payable in accordance with the Company policy.  Such salary shall be pro rated for any partial year of employment on the basis of a 365-day fiscal year.  Executive will be eligible for bonuses from time to time as determined by the Board.

Section 3.12 of the Employment Agreement is amended to read:

3.12   Executive shall receive 12,500 shares per quarter of service completed commencing with the quarter beginning July 1, 2014.  Executive shall receive options to purchase 200,000 shares of common stock at the fair market value on June 30, 2014.

 

Section 4.4.3(ii) and 4.4.3 (iii) shall be modified to read:

 

4.4.3 (ii)  Continuation of Executive’s annual Base Salary, in effect at the time of termination, for a period of forty-eight (48) months after the termination date subject to standard deductions and withholdings;

 

  

  

  

(iii)           Continuation of Executive's medical, disability and other benefits for a period for  forty-eight (48) months after the termination date, as if Executive had continued in employment during said period, or in lieu thereof, cash (including a tax-equivalency payment for Federal, state and local income and payroll taxes assuming Executive is in the maximum tax bracket for all such purposes) where such benefits may not be continued (or where such continuation would adversely affect the tax status of the plan pursuant to which the benefit is being provided) under applicable law or regulation; and,

 

The Amendment is agreed to on June 30, 2014 and shall become effective as of the date first written above.

 

Employee

 

By:  /s/ Najeeb Ghauri                      

Najeeb Ghauri

 

NetSol Technologies, Inc.

 

 

	

By:  /s/ Roger K. Almond                

	

By:  /s/ Patti L. W. McGlasson                  

	

Roger K. Almond

	

Patti L. W. McGlasson

	

Chief Financial Officer

	

Sr. V.P., Corporate and Legal Affairs, General Counsel & Corporate Secretary

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