Exhibit 10.1

May 22, 2006

Susan D. Mermer

c/o eMerge Interactive, Inc.

10305 102nd Terrace

Sebastian, FL 32958

Re: Amended and Restated Employment Agreement

Dear Susan:

eMerge Interactive, Inc. (the “Company”) is pleased to confirm the following
terms and conditions for your employment as the Company’s Executive Vice
President and Chief Financial Officer. The terms of this amended and restated
employment agreement effective May 22, 2006 are as follows:

 

Base Salary:    Annual salary of $150,000.00 Equity Compensation:    Subject to
the terms and conditions of the Company’s 1999 Equity Compensation Plan (the
“Plan”), you shall be eligible to participate in the Plan, and shall be eligible
to receive stock option and/or restricted stock grants under the Plan. The
timing, amounts, term, vesting schedule and other terms and conditions of such
grants, if any, shall be approved by the Compensation Committee in its sole
discretion. Termination for Cause:    You may be terminated for “Cause” for the
following reasons: (1) dishonesty or willful misconduct which harms the Company
or its reputation, (2) conviction of a crime which in the Company’s view makes
you unfit to continue in your position, (3) substance abuse for which you fail,
after notice, to undergo and complete treatment, or (4) repeated or willful
failure to carry out the lawful directions of the Chief Executive Officer or
Board of Directors after written notice and a fifteen day period to cure and the
opportunity to have a hearing in front of the Board. Salary Continuance:    If,
within six (6) months following a Change of Control, either the Company
terminates you without Cause or you resign for Good Reason (as such term is
defined below), you will receive (i) your salary through the date of your
termination, together with any other compensation that had previously been
earned by, or awarded to, you prior to such date, but not yet paid, plus (ii) a
prorated bonus (if any bonus program is then in effect) for the fiscal year that
includes the date of your termination, plus (iii) a severance benefit equal to
six (6) months of your then-effective salary. The foregoing amounts shall be

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   payable in a lump-sum, in cash, less any applicable withholding taxes, within
ten (10) business days after the date of your termination. You must agree not to
compete with the Company for six (6) months after the date of your termination
as a condition to receiving these benefits. You may resign for Good Reason
within six months following a Change of Control for the following reasons:
(a) upon any material failure by the Company to comply with any of the material
provisions of this Agreement, which failure continues unremedied for 10 business
days after you have given the Board of Directors written notice of such failure,
(b) in the event that your position with the Company is materially diminished or
(c) in the event that the Company requires you to move more than fifty (50)
miles from the Company’s current headquarters in Sebastian, Florida, in order to
maintain your position with the Company.    If the Company terminates your
employment without Cause and a Change of Control has not occurred, you will
receive (i) your salary through the date of your termination, together with any
other compensation that had previously been earned by, or awarded to, you prior
to such date, but not yet paid, plus (ii) a prorated bonus (if any bonus program
is then in effect) for the fiscal year that includes the date of your
termination (the foregoing amounts to be payable in a lump-sum, in cash, less
any applicable withholding taxes, within ten (10) business days after the date
of your termination), plus (iii) salary continuation (payable in accordance with
the Company’s normal payroll practices) as severance for a period of six (6)
months after the date of your termination. You must agree not to compete with
the Company during the period of your salary continuance as a condition to
receiving these benefits. Change of Control:    For purposes of this Agreement,
a “Change of Control” shall mean any of the following events:   

(a)     An acquisition (other than directly from the Company) of any voting
securities of the Company (the “Voting Securities”) by any “Person” (as such
term is used for purposes of Section 13(d) or 14(d) of the Securities Act of
1934, as amended (the “1934 Act”)) immediately after which such Person has
“Beneficial Ownership” (within the meaning of Rule 13d-3 promulgated under the
1934 Act) of a majority of the combined voting power of the Company’s then
outstanding Voting Securities; provided, however, that in determining whether a
Change of Control has occurred, Voting Securities which are acquired in a
“Non-Control Acquisition” (as such term is defined below) shall not constitute a
Change of Control. A “Non-Control Acquisition” shall mean an acquisition by (1)
an employee benefit plan (or a trust forming a part thereof) maintained by (a)
the Company or (b) any corporation or other

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Person of which a majority of its voting power or its equity securities or
equity interest is owned directly or indirectly by the Company (a “Subsidiary”),
(2) the Company or any Subsidiary, or (3) any Person in connection with a
“Non-Control Transaction” (as such term is defined below); or

  

(b)    Consummation of:

  

(1)     A merger, consolidation or reorganization involving the Company, unless
persons who are stockholders of the Company immediately before such merger,
consolidation or reorganization, directly or indirectly, beneficially own at
least fifty-one percent (51%) of the combined voting power of the outstanding
voting securities of the corporation resulting from such a merger or
consolidation or reorganization (the “Surviving Corporation”) (a transaction
described in this Section (b)(1) shall herein be referred to as a “Non-Control
Transaction”); or

  

(2)     A sale or other disposition of all or substantially all of the assets of
the Company to any Person (other than a transfer to a Subsidiary).

Other Agreements:    This agreement is contingent upon your execution of and
continued adherence to our standard non-disclosure, non-compete and assignment
of inventions agreement, which will include an agreement not to solicit or hire
any of the Company’s employees within one year after termination of your
employment. Benefits:    You will continue to be eligible to participate in the
Company’s medical, dental and life insurance policies and the Company’s 401(k)
plan. Employment Type:    At will. Entire Agreement; Amendment:    This amended
and restated employment agreement and the documents referred to herein
constitute the entire agreement between the parties pertaining to the subject
matter hereof, and supersede all prior and contemporaneous agreements,
understandings, negotiations and discussions of the parties, whether oral or
written, including, without limitation, the letter agreements, dated June 16,
2000, and January 25, 2006, by and between you and the Company. No amendment,
supplement, modification, waiver or termination of this amended and restated
employment agreement shall be binding unless executed in writing by the party to
be bound thereby.

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Please signify your acceptance of, and agreement to, the terms and conditions
set forth in this amended and restated employment agreement by signing below.

Sincerely,

 

: /s/ DAVID C. WARREN

David C. Warren

President and Chief Executive Officer

 

Enclosures:    Benefits Summary    Drug Free Workplace Policy    Drug Screen
Chain of Custody Form    Travel and Entertainment Policy    Non-Disclosure and
Invention Assignment Agreement

 

Accepted and agreed:  :  

/s/ SUSAN D. MERMER

       Date: :   May 22, 2006