NetSol Technologies Acquires U.S. Based McCue Systems; Acquisition Expected to Open Door to World's Largest Equipment Finance Market and Establishes a Solid U.S Footprint for NetSol Technologies

NetSol will acquire 100 percent of McCue Systems for approximately$8.5 million. This payment will consist of 50 percent cash with thebalance paid through the issuance of NetSol's common stock carryingRule 144 restrictions. The reminder of the payment will be provided byinstitutional investors. Under the terms of the agreement, there is a50 percent deferred component based on an earn-out formula overMcCue's 2006 and 2007 fiscal years, ending December 31, 2006 andDecember 31, 2007, respectively. The company anticipates paying thebalance of the consideration in two traunches scheduled over the next24 months.

NetSol has reported six consecutive quarters of revenue growth andprofitability, with net revenue of $9 million for the first six monthsof fiscal 2006, an 88 percent increase over the comparable period.Management has provided revenue guidance of $19 million to $20 millionfor fiscal 2006 ending June 30, 2006. McCue Systems reported revenueof approximately $5.6 million with net profit of approximately$655,000 for fiscal 2005 ended December 31, 2005.

"The acquisition of McCue marks another major milestone in ourgrowth strategy and provides an entree into one of the largest marketsfor information technology solutions and services within the equipmentfinance industry, said NetSol Technologies CEO, Naeem Ghauri.

"During the initial software development project with McCue,"continued Ghauri, "it became apparent that the company and itsmanagement team presented a superior vehicle to launch a combinedproduct offering with significant brand awareness within the U.S.equipment leasing industry and create a company with unparalleledglobal reach. Working closely with McCue's management team during ournegotiations and due diligence process confirmed our decision tocreate a global company capable of providing customers on everycontinent with well-priced, innovative products developed with thehighest quality standards."

Mr. Najeeb Ghauri, Chairman of NetSol commented, "I am excited tohave taken part in launching NetSol into a vibrant and strong U.S.financial market through the acquisition of McCue Systems," He furtherstated, "McCue's marquee customer base provides NetSol with animmediate footprint in the U.S. and their strong revenue stream willboost our top line growth. Additionally," continued Ghauri, "ourproduct development and technology expertise will be greatly enhancedby McCue's mature delivery and U.S. support infrastructure. Now NetSolis positioned to compete with larger, less niche focused softwareproviders such as Oracle and SAP. We believe this agreement is thefirst aggressive step toward considerable growth in the U.S.marketplace."

John McCue, CEO of McCue Systems stated," We are pleased to jointhe NetSol family," "We performed our due diligence with a trip toNetSol's technology campus in Lahore, Pakistan, and a visit toU.K.-based CQ Systems Ltd (trading as NetSolCQ), whose acquisition wasfinalised approximately a year ago. I was impressed with the qualityand professionalism of the management teams, the successfulintegration of NetSolCQ, and the strong infrastructure created byNetSol Technologies.

"This acquisition," continued McCue, "brings together an idealcombination of products, infrastructure and intellectual capital at atime in the industry when companies are searching for a robust,scaleable, global leasing solution that can be implemented on time andon budget. Today, even with almost two thirds of all leasing volumeoriginating in the U.S., customers and prospects alike seek providerswho offer global operations with localization of support andfunctionality. We look forward to continued success and believe ouremployees, customers and investors will be well served by theacquisition."

The terms of the transaction will be disclosed in the Company'sForm 8-K filed with the Securities and Exchange Commission. MaximGroup, LLC, a full service investment banking firm headquartered inNew York City, provided acquisition negotiation and advisory servicesto NetSol Technologies.

About McCue Systems

With over 30 years of experience in developing business solutionsfor the equipment and vehicle leasing industry, McCue Systems Inc. isthe leading provider of lease/loan portfolio management software inNorth America for banks, leasing companies and manufacturers. Itsflagship product, LeasePak, simplifies lease/loan administration andasset management by accurately tracking leases, loans and equipmentfrom origination through end-of-term and disposition. McCue Systemsleads the leasing technology industry in the development ofWeb-enabled and Web-based tools to deliver superior customer service,reduce operating costs, streamline the lease management lifecycle, andsupport collaboration with origination channel and asset partners.Alone in the industry within the U.S., McCue Systems offers aWeb-based front-end system that integrates fully with the system'sback-office database architecture.

By harnessing the most advanced technologies, McCue Systems canoffer the right operating platform for almost any enterprise. LeasePakcan be configured to run on HP-UX, SUN/Solaris or Linux, as well asfor Oracle and Sybase users. And for unmatched scalability, McCueSystems offers the LeasePak Bronze, Silver and Gold Editions forsystems and portfolios of virtually all sizes and complexities. McCueSystems' solutions set the industry standard for reliability,providing the equipment and vehicle leasing infrastructure at leadingFortune 500 banks and manufacturers, as well as for the industry'sleading independent lessors, including Cisco, Hyundai, JPMorgan/Chase, ORIX, and Volkswagen Credit. The leasing experts atMcCue Systems work closely with lessors to put the company's leasingexpertise to work to streamline lease operations and enhance customerretention at every stage of the lease lifecycle. For more information,visit www.mccue.com .

About NetSol Technologies, Inc.

NetSol Technologies, who acquired UK based CQ Systems Ltd (nowtrading as NetSolCQ) in February 2005, is an end-to-end solutionprovider for the lease and finance industry and provider of LeaseSoftsoftware solutions. Headquartered in California, USA, NetSolTechnologies operates on a global basis with locations in the U.S.,U.K., Europe, East Asia and Asia Pacific. NetSol helps its clientsidentify, evaluate and implement technology solutions to meet theirmost critical business challenges and maximize their bottom line. Byutilizing its worldwide resources, NetSol delivers high-quality,cost-effective IT services ranging from consulting and applicationdevelopment to systems integration and outsourcing. NetSol'scommitment to quality is demonstrated by its achievement of both ISO9001 and SEI (Software Engineering Institute) CMM (Capability MaturityModel) Level 4 assessment. For more information, visit NetSolTechnologies' web site at www.netsoltek.com.