Document:

Exhibit
10.39

     

    EMPLOYMENT
AGREEMENT

     

    This
Employment Agreement ("Agreement") is made and
entered into effective as of October 19, 2010 by and between VITACOST.COM, INC., a Delaware
corporation (the "Company"), and STEPHEN MARKERT (hereinafter,
the "Employee").

     

    WITNESSETH:

     

    WHEREAS, the Board of
Directors of the Company desires to employ the Employee as its interim Chief
Financial Officer;

     

    WHEREAS, the Employee is
willing to make his services available to the Company on the terms and
conditions hereinafter set forth.

     

    NOW, THEREFORE, in
consideration of the premises and mutual covenants set forth herein, and for
other good and valuable consideration, the receipt and sufficiency of which are
mutually acknowledged, the Company and the Employee hereby agree as
follows:

     

    1.           Definitions.  When
used in this Agreement, the following terms shall have the following
meanings:

     

    (a)          “Accrued
Obligations” means:

     

    (i)           all
accrued but unpaid Base Salary through the end of the Term of
Employment;

     

    (ii)          any
unpaid or unreimbursed expenses incurred in accordance with Company policy,
including amounts due under Section 5(a) hereof, to the extent incurred during
the Term of Employment;

     

    (iii)         any
benefits provided under the Company’s employee benefit plans upon a termination
of employment, in accordance with the terms therein, including rights to equity
in the Company pursuant to any plan or grant; and

     

    (iv)         any
unpaid Bonus in respect to any completed fiscal year that has ended on or prior
to the end of the Term of Employment.

     

    (b)          “Base
Salary” means the salary provided for in Section 4(a) hereof or any
increased salary granted to Employee pursuant to Section 4(a)
hereof.

     

    (c)          “Board”
means the Board of Directors of the Company.

     

    (d)          “Bonus”
means any bonus payable to the Employee pursuant to Section 4(b)
hereof.

     

    (e)         “Cause”
means:

     

    (i)           willful
misconduct or gross negligence by the Employee resulting, in either case, in
material economic harm to the Company or any of its Related
Entities;

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    (ii)          a
willful and continuing failure to perform Employee’s duties and responsibilities
hereunder including, without limitation, a willful and continuing failure by the
Employee to carry out the reasonable and lawful directions of the
Board;

     

    (iii)         the
Employee’s fraud, embezzlement, misappropriation of funds or breach of trust in
connection with his services hereunder;

     

    (iv)         the
Employee’s commission, indictment or conviction, or a plea of nolo contendere,
of a felony; or

     

    (v)          a
willful material breach by the Employee of this Agreement.

     

    The
Board’s determination of Cause shall be final, binding and conclusive with
respect to all parties.  For purposes of this Section, an act or
failure to act shall not be “willful” if done by the Employee in good faith and
the Employee reasonably believed such action or inaction was in the best
interests of the Company.

     

    (f)          “Commencement
Date” means October 19, 2010.

     

    (g)         “Competitive
Activity” means an activity that is in direct competition with the
Company in any of the States within the United States or its territories or
possessions, or countries within the world, in which the Company or any of its
Related Entities conducts business with respect to a business in which the
Company or any of its Related Entities engaged while the Employee was employed
by the Company or any of its Related Entities.

     

    (h)         “Confidential
Information” means all trade secrets and information disclosed to the
Employee or known by the Employee as a consequence of or through the unique
position of his employment and/or service with the Company or any Related Entity
(including information conceived, originated, discovered or developed by the
Employee and information acquired by the Company or any Related Entity from
others) prior to or after the date hereof, and not generally or publicly known
(other than as a result of unauthorized disclosure by the Employee), about the
Company or any Related Entity or its business. Confidential Information
includes, but is not limited to, inventions, ideas, designs, computer programs,
circuits, schematics, formulas, algorithms, trade secrets, works of authorship,
mask works, developmental or experimental work, processes, techniques,
improvements, methods of manufacturing, know-how, data, financial information
and forecasts, product plans, marketing plans and strategies, price lists,
customer lists and contractual obligations and terms thereof, data,
documentation and other information, in whatever form disclosed, relating to the
Company or any Related Entity, including, but not limited to, financial
statements, financial projections, business plans, listings and contractual
obligations and terms thereof, components of intellectual property, unique
designs, methods of manufacturing or other technology of the Company or any
Related Entity.  Notwithstanding anything to the contrary,
“Confidential Information” shall not include information, including, but not
limited, to general industry knowledge, which is not separable from any
Confidential Information and was known to the Employee prior to his receipt of
the same from the Company.

     

    (i)           “Disability”
means the Employee’s inability, or failure, to perform the essential functions
of his position, with or without reasonable accommodation, for any period of
ninety (90) days or more in any one hundred and eighty (180) day period, by
reason of any medically determinable physical or mental
impairment.

    
      
         

      

      
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    (j)           “Expiration
Date” means the date on which the Term of Employment, including any
renewals thereof under Section 3(b), shall expire.

     

    (k)         “Related Entity”
means any subsidiary, and any business, corporation, partnership, limited
liability company or other entity designated by Board in which the
Company  or a subsidiary holds a substantial ownership interest,
directly or indirectly.

     

    (l)           “Restricted
Period” shall be the Term of Employment and the one (1) year period
immediately following termination of the Term of Employment.

     

    (m)         “Term of
Employment” means the period during which the Employee shall be employed
by the Company pursuant to the terms of this Agreement.

     

    (n)          “Termination
Date” means the date on which the Term of Employment ends.

     

    2.           Employment.

     

    (a)    
     Employment and
Term.  The
Company hereby agrees to employ the Employee and the Employee hereby agrees to
serve the Company during the Term of Employment on the terms and conditions set
forth herein.

     

    (b)          Duties of
Employee.  During
the Term of Employment under this Agreement, the Employee shall be employed and
shall serve as the interim Chief Financial Officer (“CFO”) of the Company, and
shall have duties typically associated with such title including, without
limitation, supervising the financial operations of the Company and its Related
Entities.  The Employee shall have such power and authority as shall
reasonably be required to enable him to perform his duties
hereunder.  The Employee shall report to the Board and Chief Executive
Officer, and shall perform faithfully, industriously, and to the best of the
Employee’s ability, experience and talents, all of the duties and
responsibilities set forth hereunder to the reasonable satisfaction of the
Board.  The Employee shall devote his full time and attention to the
business and affairs of the Company, render such services to the best of his
ability, and use his reasonable best efforts to promote the interests of the
Company.

     

    3.           Term.  The
Term of Employment under this Agreement, and the employment of the Employee
hereunder, shall commence on the Commencement Date and shall continue
indefinitely until terminated in accordance with Section 6 hereof.

     

    4.           Compensation.

     

    (a)          Base
Salary.  The
Employee shall receive a Base Salary at the annual rate of Two Hundred Thirty
Five Thousand Dollars ($235,000) during the Term of Employment, with such Base
Salary payable in installments consistent with the Company's normal payroll
schedule, subject to applicable withholding and other taxes.

     

    
      
         

      

      
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    (b)          Discretionary
Bonuses.  During
the Term of Employment, the Company, in its sole and absolute discretion, may
pay to the Employee such bonuses, if any, as the Company may
determine.

     

    5.           Expense
Reimbursement and Other Benefits.

     

    (a)          Reimbursement of
Business Expenses. During
the Term of Employment, the Company shall reimburse the Employee for all
reasonable expenses actually paid or incurred by the Employee in the course of,
pursuant to and in furtherance of the business of the Company, upon proper
submission of supporting documentation by the Employee and in accordance with
such policies and guidelines as from time to time may be reasonably established
by the Company for its Chief Executive Officer.

     

    (b)          Compensation/Benefit
Programs.  During
the Term of Employment, the Employee shall be entitled to participate in such
life insurance, medical, dental and 401(k) plans and other benefit programs as
may be approved from time to time by the Company for the benefit of the
employees of the Company that the Company determines to be of similar rank and
status to the Employee, subject to the general eligibility and participation
provisions set forth in such plans and applicable law.

     

    (c)          Housing/Car/Travel
Allowance.   During
the Term of Employment, the Company shall reimburse the Employee for up to a
maximum of Two Thousand Dollars ($2,000) per month for living expenses, it being
expressly acknowledged and agreed that such reimbursements shall only include
the following: temporary housing allowance, rental car cost and round-trip air
fare (no more than two times per month) between his home in Philadelphia,
Pennsylvania and the Company's offices in
Florida.   Notwithstanding anything to contrary, any
reimbursements by the Company to the Employee of any eligible expenses under
this Agreement that are not excludable from the Employee’s income for Federal
income tax purposes (the “Taxable Reimbursements”) shall
be made by no later than the last day of the taxable year of the Employee
following the year in which the expense was incurred.  The amount of
any Taxable Reimbursements, and the value of any in-kind benefits to be provided
to the Employee, during any taxable year of the Employee shall not affect the
expenses eligible for reimbursement, or in-kind benefits to be provided, in any
other taxable year of the Employee. The right to Taxable Reimbursement, or
in-kind benefits, shall not be subject to liquidation or exchange for another
benefit

     

    6.           Termination.

     

    (a)   
      General.         The
Term of Employment under this Agreement shall terminate upon the earliest to
occur of the following:

     

    (i)           On
the date of death of the Employee;

     

    (ii)          On
the date that the Company gives written notice to the Employee that the Company
is terminating the Term of Employment based on the Company’s determination that
the Employee suffers from a Disability;

    
      
         

      

      
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    (iii)          On
the date that the Company provides the Employee with written notice that the
Company is terminating the Term of Employment for Cause; and

     

    (iv)          On
the sixtieth (60th) day
after either the Employee or the Company other than for Cause gives written
notice to the other party of his or its election to terminate the Term of
Employment.

     

    (b)          Payments on
Account of Termination.  In
the event that the Term of Employment is terminated for any of the reasons
stated in Section 6(a) hereof, the Company shall pay to the Employee any unpaid
Accrued Obligations through the effective date of the termination of
employment.  The Company shall have no further liability or obligation
hereunder (other than for reimbursement for reasonable business expenses
incurred prior to the date of termination, subject, however, to Section 5(a)
hereof).

     

    (c)          Cooperation.  Following
the Term of Employment, the Employee shall give his assistance and cooperation
willingly, upon reasonable advance notice with due consideration for his other
business or personal commitments, in any matter relating to his position with
the Company, or his expertise or experience as the Company may reasonably
request, including his attendance and truthful testimony where deemed
appropriate by the Company, with respect to any investigation or the Company’s
defense or prosecution of any existing or future claims or litigations or other
proceedings relating to matters in which he was involved or potentially had
knowledge by virtue of his employment with the Company.  In no event
shall his cooperation materially interfere with his services for a subsequent
employer or other similar service recipient.  To the extent permitted
by law, the Company agrees that (i) it shall promptly reimburse the Employee for
his reasonable and documented expenses in connection with his rendering
assistance and/or cooperation under this Section 6(d) upon his presentation of
documentation for such expenses and (ii) the Employee shall be reasonably
compensated for any continued material services as required under this Section
6(d).

     

    (d)          Return of Company
Property.  Following
the Termination Date, the Employee or his personal representative shall return
all Company property in his possession, including but not limited to all
computer equipment (hardware and software), telephones, facsimile machines, palm
pilots and other communication devices, credit cards, office keys, security
access cards, badges, identification cards and all copies (including drafts) of
any documentation or information (however stored) relating to the business of
the Company, its customers and clients or its prospective customers and clients
(provided that the Employee may retain a copy the addresses contained in his
rolodex, palm pilot, PDA or similar device) including, without limitation,
non-public Company financial statements, promotional and advertising materials,
minute books, stockholder lists, litigation files, memoranda and other
documents, and all correspondences with Nasdaq, the Securities and Exchange
Commission, outside auditors and counsel, and with all public and governmental
authorities, as well as copies of the same and all documents and materials
within Employee’s possession or control that are extrapolations or based on any
such documents and materials.

     

    
      
         

      

      
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    (e)          Section
409A.  It
is the intention of both the Company and the Employee that the benefits and
rights to which the Employee could be entitled pursuant to this Agreement comply
with Section 409A of the Code and the Treasury Regulations and other guidance
promulgated or issued thereunder (“Section 409A”), to the extent
that the requirements of Section 409A are applicable thereto, and the provisions
of this Agreement shall be construed in a manner consistent with that
intention.  If the Employee or the Company believes, at any time, that
any such benefit or right that is subject to Section 409A does not so comply, it
shall promptly advise the other and shall negotiate reasonably and in good faith
to amend the terms of such benefits and rights such that they comply with
Section 409A (with the most limited possible economic effect on the Employee and
on the Company).

     

    7.           Restrictive
Covenants.

     

    (a)          Non-competition.  At
all times during the Restricted Period, the Employee shall not, directly or
indirectly (whether as a principal, agent, partner, employee, officer, investor,
owner, consultant, board member, security holder, creditor or otherwise), engage
in any Competitive Activity, or have any direct or indirect interest in any sole
proprietorship, corporation, company, partnership, association, venture or
business or any other person or entity that directly or indirectly (whether as a
principal, agent, partner, employee, officer, investor, owner, consultant, board
member, security holder, creditor, or otherwise) engages in a Competitive
Activity; provided that the foregoing shall not apply to the Employee’s
ownership of not more than five percent (5%) of the outstanding Common Stock or
other voting securities of the Company or the acquisition by the Employee,
solely as an investment, of not more than five percent (5%) of the outstanding
securities of any issuer that is registered under Section 12(b) or 12(g) of the
Securities Exchange Act of 1934, as amended, and that are listed or admitted for
trading on any United States national securities exchange or included for
quotation on any United States inter-dealer quotation system of a registered
national securities association, so long as the Employee does not control,
acquire a controlling interest in or become a member of a group which exercises
direct or indirect control of, more than five percent (5%) of any class of
capital stock of such corporation.

     

    (b)          Nonsolicitation
of Employees and Certain Other Third Parties.  At
all times during the Restricted Period, the Employee shall not, directly or
indirectly, for himself or for any other person, firm, corporation, partnership,
association or other entity (i) employ or attempt to employ or enter into
any contractual arrangement with any employee, consultant or independent
contractor performing services for the Company, or any Related Entity, unless
such employee, consultant or independent contractor, has not been employed or
engaged by the Company for a period in excess of six (6) months, and/or
(ii) call on or solicit any of the actual or targeted prospective customers
or clients of the Company or any Related Entity on behalf of any person or
entity in connection with any Competitive Activity, nor shall the Employee make
known the names and addresses of such actual or targeted prospective customers
or clients, or any information relating in any manner to the trade or business
relationships of the Company or any Related Entities with such customers or
clients, other than in connection with the performance of the Employee’s duties
under this Agreement, and/or (iii) persuade or encourage or attempt to persuade
or encourage any persons or entities with whom the Company or any Related Entity
does business or has some business relationship to cease doing business or to
terminate its business relationship with the Company or any Related Entity or to
engage in any business competitive with the Company or any Related Entity on its
own or with any competitor of the Company or any Related Entity.

     

    
      
         

      

      
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    (c)          Confidential
Information.  The
Employee shall not at any time divulge, communicate, use to the detriment of the
Company or any Related Entity or
for the benefit of any other person or persons, or misuse in any way, any
Confidential Information.  Any Confidential Information now or
hereafter acquired by the Employee shall be deemed a valuable, special and
unique asset of the Company and its Related Entities that
is received by the Employee in confidence and as a fiduciary, and the Employee
shall remain a fiduciary to the Company and its Related Entities with
respect to all such Confidential Information. Notwithstanding the foregoing,
nothing herein shall be deemed to restrict the Employee from disclosing
Confidential Information to the extent Employee’s counsel reasonably determines
that such disclosure is required by law; provided that if any person or
authority makes a demand on the Employee purporting to legally compel him to
divulge any Confidential Information, the Employee immediately shall give notice
of the demand to the Company so that the Company may first assess whether to
challenge the demand prior to the Employee’s divulging of such Confidential
Information and to enable the Company a reasonable opportunity to obtain a
protective order against disclosure or all or a portion of the Confidential
Information.  Subject to the immediately preceding sentence, the
Employee shall not divulge such Confidential Information until the Company, in a
timely manner, either has concluded not to challenge the demand, or has
exhausted its challenge, including appeals, if any.  Upon request by
the Company, the Employee shall deliver promptly to the Company upon termination
of his services for the Company, or at any time thereafter as the Company may
request, all originals and copies of memoranda, notes, records, reports,
manuals, drawings, designs, computer files in any media and other documents (and
all copies thereof) containing or based upon such Confidential
Information.

     

    (d)         Ownership of
Developments.  All
processes, concepts, techniques, inventions and works of authorship, including
new contributions, improvements, formats, packages, programs, systems, machines,
compositions of matter manufactured, developments, applications and discoveries,
and all copyrights, patents, trade secrets, or other intellectual property
rights associated therewith conceived, invented, made, developed or created by
the Employee during the Term of Employment either during the course of
performing work for the Companies or their clients or which are related in any
manner to the business (commercial or experimental) of the Company or its
clients (collectively, the “Work Product”) shall belong exclusively to the
Company and shall, to the extent possible, be considered a work made by the
Employee for hire for the Company within the meaning of Title 17 of the United
States Code.  To the extent the Work Product may not be considered
work made by the Employee for hire for the Company, the Employee agrees to
assign, and automatically assign at the time of creation of the Work Product,
without any requirement of further consideration, any right, title, or interest
the Employee may have in such Work Product.  Upon the request of the
Company, the Employee shall take such further actions, including execution and
delivery of instruments of conveyance, as may be appropriate to give full and
proper effect to such assignment. The Employee shall further: (i) promptly
disclose the Work Product to the Company; (ii) assign to the Company, without
additional compensation, all patent or other rights to such Work Product for the
United States and foreign countries; (iii) sign all papers necessary to carry
out the foregoing; and (iv) give testimony in support of his inventions, all at
the sole cost and expense of the Company.

     

    
      
         

      

      
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    (e)          Books and
Records.  All
books, records, and accounts relating in any manner to the customers or clients
of the Company, whether prepared by the Employee or otherwise coming into the
Employee's possession, shall be the exclusive property of the Company and shall
be returned immediately to the Company on termination of the Employee's
employment hereunder or on the Company's request at any time.

     

    (f) 
         Acknowledgment by
Employee. The
Employee acknowledges and confirms that the restrictive covenants contained in
this Section 7 (including without limitation the length of the term of the
provisions of this Section 7) are reasonably necessary to protect the legitimate
business interests of the Company, and are not overbroad, overlong, or unfair
and are not the result of overreaching, duress or coercion of any kind. The
Employee further acknowledges and confirms that the compensation payable to the
Employee under this Agreement is in consideration for the duties and obligations
of the Employee hereunder, including the restrictive covenants contained in this
Section 7, and that such compensation is sufficient, fair and
reasonable.  The Employee further acknowledges and confirms that his
full, uninhibited and faithful observance of each of the covenants contained in
this Section 7 will not cause him any undue hardship, financial or otherwise,
and that enforcement of each of the covenants contained herein will not impair
his ability to obtain employment commensurate with his abilities and on terms
fully acceptable to him or otherwise to obtain income required for the
comfortable support of him and his family and the satisfaction of the needs of
his creditors.  The Employee acknowledges and confirms that his
special knowledge of the business of the Company is such as would cause the
Company serious injury or loss if he were to use such ability and knowledge to
the benefit of a competitor or were to compete with the Company in violation of
the terms of this Section 7. The Employee further acknowledges that the
restrictions contained in this Section 7 are intended to be, and shall be, for
the benefit of and shall be enforceable by, the Company’s successors and
assigns.  The Employee expressly agrees that upon any breach or
violation of the provisions of this Section 7, the Company shall be entitled, as
a matter of right, in addition to any other rights or remedies it may have, to
(i) temporary and/or permanent injunctive relief in any court of competent
jurisdiction as described in Section 7(g) hereof, and (ii) such damages as are
provided at law or in equity. The existence of any claim or cause of action
against the Company or its affiliates, whether predicated upon this Agreement or
otherwise, shall not constitute a defense to the enforcement of the restrictions
contained in this Section 7.

     

    (g)          Reformation by
Court.  In
the event that a court of competent jurisdiction shall determine that any
provision of this Section 7 is invalid or more restrictive than permitted under
the governing law of such jurisdiction, then only as to enforcement of this
Section 7 within the jurisdiction of such court, such provision shall be
interpreted or reformed and enforced as if it provided for the maximum
restriction permitted under such governing law.

     

    (h)          Extension of
Time.  If
the Employee shall be in violation of any provision of this Section 7, then each
time limitation set forth in this Section 7 shall be extended for a period of
time equal to the period of time during which such violation or violations
occur.  If the Company seeks injunctive relief from such violation in
any court, then the covenants set forth in this Section 7 shall be extended for
a period of time equal to the pendency of such proceeding including all appeals
by the Employee.

     

    
      
         

      

      
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    (i) 
         Injunction.  It
is recognized and hereby acknowledged by the parties hereto that a breach by the
Employee of any of the covenants contained in Section 7 of this Agreement will
cause irreparable harm and damage to the Company, the monetary amount of which
may be virtually impossible to ascertain.  As a result, the Employee
recognizes and hereby acknowledges that the Company shall be entitled to an
injunction from any court of competent jurisdiction enjoining and restraining
any violation of any or all of the covenants contained in Section 7 of this
Agreement by the Employee or any of his affiliates, associates, partners or
agents, either directly or indirectly, and that such right to injunction shall
be cumulative and in addition to whatever other remedies the Company may
possess.

     

    8.           Representations
and Warranties of Employee.  The
Employee represents and warrants to the Company that:

     

    (a)          The
Employee’s employment will not conflict with or result in his breach of any
agreement to which he is a party or otherwise may be bound;

     

    (b)          The
Employee has not violated, and in connection with his employment with the
Company will not violate, any non-solicitation, non-competition or other similar
covenant or agreement of a prior employer by which he is or may be bound;
and

     

    (c)          In
connection with Employee’s employment with the Company, he will not use any
confidential or proprietary information that he may have obtained in connection
with employment with any prior employer; and

     

    (d)          The
Employee has not (i) been convicted of any felony; or (ii) committed any
criminal act with respect to Employee’s current or any prior
employment.

     

    9.           Taxes.  Anything
in this Agreement to the contrary notwithstanding, all payments required to be
made by the Company hereunder to the Employee or his estate or beneficiaries
shall be subject to the withholding of such amounts relating to taxes as the
Company may reasonably determine it should withhold pursuant to any applicable
law or regulation.  In lieu of withholding such amounts, in whole or
in part, the Company may, in its sole discretion, accept other provisions for
payment of taxes and withholding as required by law, provided it is satisfied
that all requirements of law affecting its responsibilities to withhold have
been satisfied.

     

    10.          Assignment.  The
Company shall have the right to assign this Agreement and its rights and
obligations hereunder in whole, but not in part, to any corporation or other
entity with or into which the Company may hereafter merge or consolidate or to
which the Company may transfer all or substantially all of its assets, if in any
such case said corporation or other entity shall by operation of law or
expressly in writing assume all obligations of the Company hereunder as fully as
if it had been originally made a party hereto, but may not otherwise assign this
Agreement or its rights and obligations hereunder.  The Employee may
not assign or transfer this Agreement or any rights or obligations
hereunder.

     

    11.         Governing
Law.  This
Agreement shall be governed by and construed and enforced in accordance with the
internal procedural and substantive laws of the State of Delaware, without
regard to principles of conflict of laws of such state.

     

    
      
         

      

      
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    12.         Jurisdiction and
Venue.  Each
of the parties irrevocably and unconditionally (i) agrees that any suit, action
or legal proceeding arising out of or relating to this Agreement which is
expressly permitted by the terms of this Agreement to be brought in a court of
law, shall be brought in the courts of record of the State of Florida in Palm
Beach County or the court of the United States, Southern District of Florida;
(ii) consents to the jurisdiction of each such court in any such suit, action or
proceeding; (iii) waives any objection which it or he may have to the laying of
venue of any such suit, action or proceeding in any of such courts; and (iv)
agrees that service of any court papers may be effected on such party by mail,
as provided in this Agreement, or in such other manner as may be provided under
applicable laws or court rules in such courts.

     

    13.         Entire
Agreement.  This
Agreement constitutes the entire agreement between the parties hereto with
respect to the subject matter hereof and, upon its effectiveness, shall
supersede all prior agreements, understandings and arrangements, both oral and
written, between the Employee and the Company (or any of its affiliates) with
respect to such subject matter.  This Agreement may not be modified in
any way unless by a written instrument signed by both the Company and the
Employee.

     

    14.         Survival.  The
respective rights and obligations of the parties hereunder shall survive any
termination of the Employee’s employment hereunder, including without
limitation, the Company’s obligations under Section 6 and the Employee’s
obligations under Section 7 above, and the expiration of the Term of Employment,
to the extent necessary to the intended preservation of such rights and
obligations.

     

    15.         Notices.  All
notices under this Agreement shall be in writing and shall be given by personal
delivery, or by registered or certified United States mail, postage prepaid,
return receipt requested, to the address set forth below:

     

    
      
        	
                If
      to the Employee:

              	
                Stephen
      Markert

              
	 
      	 
      
	
                If
      to the Company:

              	
                Vitacost.com,
      Inc.

              
	 
      	
                5400
      Broken Sound Blvd

              
	 
      	
                Suite
      500

              
	 
      	
                Boca
      Raton, FL 33487

              
	 
      	
                Attn:
      Chairman of the Board of
Directors

              

      

    

    

    or to
such other person or persons or to such other address or addresses as the
Employee and the Company or their respective successors or assigns may hereafter
furnish to the other by notice similarly given.  Notices, if
personally delivered, shall be deemed to have been received on the date of
delivery, and if given by registered or certified mail, shall be deemed to have
been received on the fifth business day after mailing.

    

    16.       
 Benefits; Binding
Effect.  This
Agreement shall be for the benefit of and binding upon the parties hereto and
their respective heirs, personal representatives, legal representatives,
successors and, where permitted and applicable, assigns, including, without
limitation, any successor to the Company, whether by merger, consolidation, sale
of stock, sale of assets or otherwise.

     

    
      
         

      

      
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    17.          Right to Consult
with Counsel; No Drafting Party.  The
Employee acknowledges having read and considered all of the provisions of this
Agreement carefully, and having had the opportunity to consult with counsel of
his own choosing, and, given this, the Employee agrees that the obligations
created hereby are not unreasonable.  The Employee acknowledges that
he has had an opportunity to negotiate any and all of these provisions and no
rule of construction shall be used that would interpret any provision in favor
of or against a party on the basis of who drafted the Agreement.

     

    18.          Severability.  The
invalidity of any one or more of the words, phrases, sentences, clauses,
provisions, sections or articles contained in this Agreement shall not affect
the enforceability of the remaining portions of this Agreement or any part
thereof, all of which are inserted conditionally on their being valid in law,
and, in the event that any one or more of the words, phrases, sentences,
clauses, provisions, sections or articles contained in this Agreement shall be
declared invalid, this Agreement shall be construed as if such invalid word or
words, phrase or phrases, sentence or sentences, clause or clauses, provisions
or provisions, section or sections or article or articles had not been
inserted.  If such invalidity is caused by length of time or size of
area, or both, the otherwise invalid provision will be considered to be reduced
to a period or area which would cure such invalidity.

     

    19.          Waivers.  The
waiver by either party hereto of a breach or violation of any term or provision
of this Agreement shall not operate nor be construed as a waiver of any
subsequent breach or violation.

     

    20.          Damages;
Attorneys Fees.  Nothing
contained herein shall be construed to prevent the Company or the Employee from
seeking and recovering from the other damages sustained by either or both of
them as a result of its or his breach of any term or provision of this
Agreement. In the event that either party hereto seeks to collect any damages
resulting from, or the injunction of any action constituting, a breach of any of
the terms or provisions of this Agreement, then the party found to be at fault
shall pay all reasonable costs and attorneys' fees of the other.

     

    21.          Waiver of Jury
Trial.  The
Employee hereby knowingly, voluntarily and intentionally waives any right that
the Employee may have to a trial by jury in respect of any litigation based
hereon, or arising out of, under or in connection with this Agreement and any
agreement, document or instrument contemplated to be executed in connection
herewith, or any course of conduct, course of dealing statements (whether verbal
or written) or actions of any party hereto.

     

    22.          Section
Headings.  The
article, section and paragraph headings contained in this Agreement are for
reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.

     

    
      
         

      

      
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    23.          No Third Party
Beneficiary.  Nothing
expressed or implied in this Agreement is intended, or shall be construed, to
confer upon or give any person other than the Company, the parties hereto and
their respective heirs, personal representatives, legal representatives,
successors and permitted assigns, any rights or remedies under or by reason of
this Agreement.

     

    24.          Counterparts.  This
Agreement may be executed in one or more counterparts, each of which shall be
deemed to be an original but all of which together shall constitute one and the
same instrument and agreement.

     

    25.          Indemnification.  Contemporaneously
with the execution of this Agreement, the Company and the Employee shall entered
into that certain Indemnification Agreement, attached hereto as Exhibit A, which
provides that the Company shall indemnify and hold the Employee harmless to the
fullest extent permitted by law (including, without limitation, to the maximum
extent permitted by Section 174 of the Delaware General Corporation Law), and as
provided in the Company’s Certificate of Incorporation and By-Laws currently in
effect.

     

    
      
         

      

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

     

    
      
        	
                COMPANY:

              
	 
      
	
                VITACOST.COM,
      INC., a Delaware

                corporation

              
	 
      
	
                By:  /s/ Jeffrey
      Horowitz

              
	
                Name:
      Jeffrey Horowitz

              
	
                Title:
      Interim Chief Executive Officer

              
	 
      
	
                Date:
      10/19/2010

              
	 
      
	
                EMPLOYEE:

              
	 
      
	
                /s/
      Stephen Markert

              
	 
      
	
                STEPHEN
      MARKERT

              
	 
      
	
                Date:
      10/19/2010

              

      

    

    
      
         

      

      
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    EXHIBIT
A

    INDEMNIFICATION
AGREEMENT

     

    INDEMNIFICATION
AGREEMENT

     

    THIS
INDEMNIFICATION AGREEMENT (“Agreement”) is made and entered into this __ day of
________, 2010, effective as of _______________, 2010 by and among Vitacost.com,
Inc., a Delaware corporation (the “Company”) and STEPHEN MARKERT, an officer of
the Company (the “Indemnitee”).

     

    RECITALS

     

    WHEREAS, the interpretation of
statutes, regulations, Certification of Incorporation and Bylaws regarding
indemnification of directors and officers may be too uncertain to provide
directors and officers with adequate notice of the legal, financial and other
risks to which they may be exposed by virtue of their service as such;
and

     

    WHEREAS, damages sought
against directors and officers in shareholder or similar litigation may be
substantial, and the costs of defending such actions, and of judgments in favor
of plaintiffs or of settlement therewith, may be prohibitive for individual
directors and officers, without regard to the merits of a particular action and
without regard to the culpability of, or the receipt of improper personal
benefit by, any named director or officer; and

     

    WHEREAS, the long period of
time which may elapse before final disposition of such litigation may impose
undue hardship and burden on a director or officer or his estate in maintaining
a proper and adequate defense of himself or his estate against claims for
damages; and

     

    WHEREAS, the Company is
organized under the Delaware General Corporation Law (the “DGCL”), and the DGCL
empowers corporations to indemnify and advance expenses to a person serving as a
director or officer of the corporation and further provides that the
indemnification and advancement of expenses set forth in the DGCL are not
exclusive of any other rights to which a director may be entitled under a
corporation’s charter, bylaws, a resolution of stockholders or directors, an
agreement or otherwise; and

     

    WHEREAS, the Company desires
to retain the services of highly qualified individuals, such as Indemnitee, to
serve as directors of the Company; and

     

    WHEREAS, the Board of
Directors of the Company (the “Board”) has concluded that it is reasonable and
prudent for the Company to enter into an agreement to indemnify in a reasonable
and adequate manner the Indemnitee and to assume for itself maximum liability
for expenses and damages in connection with claims lodged against Indemnitee for
his decisions and actions as a director and/or officer of the
Company.

     

    
      
         

      

      
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    NOW, THEREFORE, in
consideration of the foregoing, and of other good and valuable consideration,
the receipt and sufficiency of which is acknowledged by each of the parties
hereto, the parties agree as follows:

     

    DEFINITIONS

    

    For
purposes of this Agreement, the following terms shall have the meanings set
forth below:

     

    “Board” shall
mean the Board of Directors of the Company.

     

    “Change
in Control” shall
mean, and shall be deemed to have occurred if on or after the date of this
Agreement, (i) any “person” or “group” (as such terms are used in Sections 13(d)
and 14(d) of the Securities Exchange Act of 1934, as amended) (such person or
entity as is agreed to by a majority of the Pre-Change in Control Directors)
becomes the “beneficial owner” (as defined in Rule 13d-3 under the Act),
directly or indirectly, of securities of the Company representing more than
twenty-five percent (25%) of the voting power represented by the Company’s then
outstanding Voting Securities, (ii) any “person” or “group” (as such terms are
used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as
amended) becomes the “beneficial owner”, directly or indirectly, of securities
of the Company entitling such beneficial owner to elect a majority of the
Company’s Board of Directors, (iii) at any time during any period of two
consecutive years, individuals who at the beginning of such period constitute
the Board of Directors, and any new director whose election to the Board of
Directors or whose nomination for election was approved by two-thirds (2/3) of
the directors who either were directors at the beginning of the period or whose
election or nomination for election was previously so approved, cease for any
reason to constitute a majority of the Board of Directors, or (iv) the Company
is liquidated or dissolved or adopts a plan of liquidation or dissolution or the
stockholders of the Company approve a sale of all or substantially all of the
Company’s assets.

     

     “Corporate
Status” shall
mean the status of a person who is or was a director or officer or Founder of
the Company, or a member of any committee of the Board, and the status of a
person who, while a director or officer of the Company, is or was serving at the
request of the Company as a director, officer, partner, trustee, employee, or
agent of another foreign or domestic corporation, partnership, joint venture,
trust, other incorporated or unincorporated entity or enterprise or employee
benefit plan.

     

    “Disinterested
Director” shall
mean a director of the Company who neither is nor was a party to the Proceeding
in respect of which indemnification is being sought by the
Indemnitee.

     

    “Expenses”
shall mean, without limitation, all reasonable expenses incurred in connection
with any Proceedings, including all attorneys’ fees, retainers, court costs,
transcript costs, fees of experts, investigation fees and expenses, accounting
and witness fees, travel expenses, duplicating costs, printing and binding
costs, telephone charges, postage, delivery service fees and all other
disbursements or expenses of the types customarily incurred in connection with
prosecuting, defending, preparing to prosecute or defend, investigating or being
or preparing to be a witness in a Proceeding.

     

    
      
         

      

      
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    “Good
Faith Act or Omission” shall mean an act or omission of the Indemnitee
reasonably believed to be in or not opposed to the best interests of the Company
and other than (i) one that was material to the loss or liability and that was
committed in bad faith or that was the result of active or deliberate
dishonesty; (ii) one from which the Indemnitee actually received an improper
personal benefit in money, property or services; or (iii) in the case of a
criminal Proceeding, one as to which the Indemnitee had cause to believe his
conduct was unlawful.

     

    “Liabilities”
shall mean all liabilities or obligations of any type whatsoever, including,
without limitation, any claims, damages, judgments, fines, excise taxes and
penalties (including under the Employee Retirement Income Security Act of 1974,
as amended) and amounts paid in settlement (including all interest, assessments
and other charges paid or payable in connection with or in respect of such
claims, damages, judgments, fines, penalties or amounts paid in settlement)
incurred, paid or suffered in connection with the investigation, defense,
prosecution, settlement or appeal of any Proceeding or any claim, issue or
matter therein.

     

    “Proceeding”
shall mean any threatened, pending or completed claim, action, suit,
arbitration, alternate dispute resolution mechanism, investigation, inquiry,
administrative hearing or any other actual, threatened or completed proceeding
whether civil, criminal, administrative or investigative, or any appeal
therefrom.

     

    “Voting
Securities” shall
mean any securities of the Company that are entitled to vote generally in the
election of directors.

     

    NOTICE OF
PROCEEDINGS AND DEFENSE OF CLAIMS

     

    Notice of
Proceedings.  The
Indemnitee agrees to notify the Company promptly in writing upon being served
with any summons, citation, subpoena, complaint, indictment, information or
other document relating to any Proceeding or matter which may be subject to
indemnification or advancement of Expenses covered hereunder, but the
Indemnitee’s failure to so notify the Company shall relieve the Company from any
liability which it may have to the Indemnitee under this Agreement only to the
extent the Company was prejudiced by such failure.

     

    
      
         

      

      
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    Defense of
Claims.  The
Company will be entitled to participate, at its own expense, in any Proceeding
of which it has notice.  The Company jointly with any other
indemnifying party similarly notified of any Proceeding will be entitled to
assume the defense of the Indemnitee therein, with counsel reasonably
satisfactory to the Indemnitee, upon delivery of written notice to Indemnitee of
its election to do so; provided, however, that the
Company shall not be entitled to assume the defense of the Indemnitee in any
Proceeding if there has been a Change in Control or if the Indemnitee has
reasonably concluded that there may be a conflict of interest between the
Company and the Indemnitee with respect to such Proceeding.  After
notice from the Company to the Indemnitee of its election to assume the defense
of the Indemnitee and the retention by the Company of counsel reasonably
satisfactory to Indemnitee, the Company will not be liable to the Indemnitee
under this Agreement for any Expenses incurred thereafter by the Indemnitee in
connection with the defense of any Proceeding, other than reasonable costs of
investigation or as otherwise provided below.  Notwithstanding the
foregoing, the Indemnitee shall have the right to employ his own counsel in any
such Proceeding if (i) the employment of counsel by the Indemnitee has been
authorized by the Company or by a majority of the Board; (ii) the Indemnitee
shall have reasonably concluded that counsel employed by the Company may not
adequately represent the Indemnitee and shall have so informed the Company; or
(iii) the Company shall not in fact have employed counsel to assume the defense
of the Indemnitee in such Proceeding or the counsel employed by the Company
shall not, in fact, have assumed such defense or such counsel shall not be
acting, in connection therewith, with reasonable diligence; and in each such
case the fees and expenses of the Indemnitee’s counsel shall be an Expense under
this Agreement and shall therefore be advanced by the Company in accordance with
this Agreement.  If Indemnitee employs his own counsel pursuant to the
prior sentence, Indemnitee shall use good faith efforts to utilize the same
counsel as other similarly situated officers and directors of the Company who
have similar interests and defenses in a Proceeding unless the Indemnitee shall
have reasonably concluded that counsel employed by other officers and directors
may not adequately represent the Indemnitee.

     

    Settlement of
Claims.  The
Company shall not settle any Proceeding in any manner which would impose any
liability, penalty or limitation on the Indemnitee without the written consent
of the Indemnitee; provided, however, that the Indemnitee will not unreasonably
withhold or delay consent to any proposed settlement. The Company shall not be
liable to indemnify the Indemnitee under this Agreement or otherwise for any
amounts paid in settlement of any Proceeding effected by the Indemnitee without
the Company’s written consent, which consent shall not be unreasonably withheld
or delayed.

     

    PERIOD OF
LIMITATIONS

     

    No legal
action shall be brought and no cause of action shall be asserted by or in the
right of the Company against Indemnitee, Indemnitee’s estate, spouse, heirs,
executors or personal or legal representatives after the expiration of the later
of (a) two years from the date of accrual of such cause of action, and (b) one
year from the date that the Company knew, or could have discovered with the
exercise of reasonable diligence, of the circumstances giving rise to such cause
of action.   Any claim or cause of action of the Company shall be
extinguished and deemed released unless asserted by the timely filing of a legal
action within such period; provided, however, that if any shorter period of
limitations is otherwise applicable to any such cause of action, such shorter
period shall govern.

     

    
      
         

      

      
        A-4

        
          

        

      

      
         

      

    

     

    INDEMNIFICATION

     

    General.  In
addition to the Company’s specific obligations set forth below, the Company
hereby agrees to indemnify the Indemnitee to the fullest extent required or
permitted by the Company’s Articles of Incorporation or Bylaws and by applicable
law in effect on the date hereof and to such greater extent as applicable law
may hereafter from time to time permit. For all matters for which the Indemnitee
is entitled to indemnification under this Article IV, the Indemnitee shall be
entitled to advancement of Expenses in accordance with Article V
hereof.  The Company’s obligation to indemnify and advance Expenses
pursuant to this Agreement shall apply to all Proceedings, regardless of whether
the underlying events, acts or omissions occurred before or after the date
hereof.

     

    Proceeding Other Than a
Proceeding by or in the Right of the Company.  If
the Indemnitee was, is, or becomes a party to, or witness or other participant
in, or is threatened to be made a party to, or witness or other participant in,
any Proceeding (other than a Proceeding by or in the right of the Company) by
reason of, or in connection with, his Corporate Status, or by reason of alleged
action or inaction by him in any such capacity, the Company shall, subject to
the limitations set forth in Section 4.6 below,
hold harmless and indemnify Indemnitee against any and all Expenses and
Liabilities actually and reasonably incurred by or for the Indemnitee in
connection with the Proceeding unless it is established pursuant to this
Agreement that act(s) or omission(s) of the Indemnitee giving rise thereto were
not Good Faith Act(s) or Omission(s).

     

    Proceedings by or in the
Right of the Company.  If
the Indemnitee was, is or becomes a party to, or witness or other participant
in, or is threatened to be made a party to, or witness or other participant in,
any Proceeding by or in the right of the Company, by reason of, or in connection
with, his Corporate Status, or by reason of alleged action or inaction by him in
such capacity, then the Company shall, subject to the limitations set forth in
Section 4.6
below, hold harmless and indemnify Indemnitee against any and all Liabilities
and Expenses actually incurred by or for him in connection with the Proceeding,
unless it is established pursuant to this Agreement that the act(s) or
omission(s) of the Indemnitee giving rise to the Proceeding were not Good Faith
Act(s) or Omission(s); except that no indemnification under this Section 4.3 shall be
made in respect of any claim, issue or matter as to which the Indemnitee shall
have been adjudged to be liable to the Company, unless a court of appropriate
jurisdiction (including, but not limited to, the court in which such Proceeding
was brought) shall determine upon application that, despite the adjudication of
liability but in view of all the circumstances of the case, regardless of
whether the Indemnitee’s act(s) or omission(s) were found to be a Good Faith
Act(s) or Omission(s), the Indemnitee is fairly and reasonably entitled to
indemnification for such Expenses which such court shall deem
proper.

     

    Indemnification of a Party
Who is Wholly or Partly Successful.  Notwithstanding any other
provision of this Agreement, to the extent that the Indemnitee is, by reason of
the Indemnitee’s Corporate Status, a party to and is successful, on the merits
or otherwise, in any Proceeding, the Indemnitee shall be indemnified by the
Company to the maximum extent permitted by applicable law, against all Expenses
and Liabilities actually incurred by or for him in connection therewith. If the
Indemnitee is not wholly successful in such Proceeding but is successful, on the
merits or otherwise, as to one or more but less than all claims, issues or
matters in such Proceeding, the Company shall hold harmless and indemnify the
Indemnitee to the maximum extent permitted by applicable law, against all
Expenses and Liabilities actually and reasonably incurred by or for him in
connection with each successfully resolved claim, issue or matter in such
Proceeding. Resolution of a claim, issue or matter by dismissal, with or without
prejudice, except as provided in Section 4.6 hereof,
shall be deemed a successful result as to such claim, issue or matter, so long
as there has been no finding (either adjudicated or pursuant to Article VI
hereof) that the act(s) or omission(s) of the Indemnitee giving rise thereto
were not a Good Faith Act(s) or Omission(s).

     

    
      
         

      

      
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    Indemnification for Expenses
as Witness.  Notwithstanding
any other provision of this Agreement, to the extent that the Indemnitee, by
reason of the Indemnitee’s Corporate Status, has prepared to serve or has served
as a witness in any Proceeding, or has participated in discovery proceedings or
other trial preparation, the Indemnitee shall be held harmless and indemnified
against all Expenses actually and reasonably incurred by or for him in
connection therewith.

     

    Specific Limitations on
Indemnification.  In
addition to the other limitations set forth in this Article IV, and
notwithstanding anything in this Agreement to the contrary, the Company shall
not be obligated under this Agreement to make any payment to the Indemnitee for
indemnification or Expenses with respect to any Proceeding:

     

    To the
extent that payment is actually made to the Indemnitee under any insurance
policy or is made on behalf of the Indemnitee by or on behalf of the Company
otherwise than pursuant to this Agreement.

     

    To the
extent it is determined pursuant to this Agreement that a claim of the
Indemnitee for such indemnification arose from:  (i) a breach by the
Indemnitee of the Indemnitee’s duty of loyalty to the Company or its
shareholders; (ii) acts or omissions of the Indemnitee that are not Good Faith
Acts or Omissions or which are the result of active and deliberate dishonesty;
(iii) acts or omissions of the Indemnitee which the Indemnitee had reasonable
cause to believe were unlawful; or (iv) a transaction in which the Indemnitee or
one of his “affiliates” (as that term is construed under Rule 405 promulgated
under the Securities Act of 1933, as amended) actually received an improper
personal benefit in money, property or service.

     

    If there
has been no Change in Control, for Liabilities in connection with Proceedings
settled by the Indemnitee without the consent of the Company which consent,
however, shall not be unreasonably withheld.

     

    If the
Proceeding was initiated by Indemnitee (other than Proceedings initiated by
Indemnitee in defense and Proceedings to enforce Indemnitee’s rights under this
Agreement or the Company’s Articles of Incorporation or Bylaws as contemplated
by Section
6.7).

     

    
      
         

      

      
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    ADVANCEMENT OF
EXPENSES

     

    The
Company shall advance to the Indemnitee all Expenses which are incurred by or
for Indemnitee in connection with any Proceeding (whether or not Indemnitee is a
party in such Proceeding) for which the Indemnitee is entitled to
indemnification pursuant to Article IV hereof, in advance of the final
disposition of such Proceeding, provided that (i) the Indemnitee provides the
Company with written affirmation of his good faith belief that he has met the
standard of conduct necessary for indemnification by the Company pursuant to
Article IV hereof, and (ii) the Indemnitee provides the Company with a written
agreement (the “Undertaking”) to repay the amount paid or reimbursed by the
Company, together with the applicable legal rate of interest thereon (computed
at the Company’s cost of borrowing funds over the period of advance from the
Company’s principal lender from time to time), if it is ultimately determined
that the Indemnitee is not entitled to be indemnified by the Company for such
amount. The Company shall advance such expenses within twenty (20) days after
the receipt by the Company of the Undertaking. The Indemnitee hereby agrees to
repay any Expenses advanced hereunder if it shall ultimately be determined that
the Indemnitee is not entitled to be indemnified against such Expenses. Any
advances and the undertaking to repay pursuant to this Article V shall be
unsecured.

     

    PROCEDURE
FOR PAYMENT OF LIABILITIES;

    DETERMINATION
OF RIGHT TO INDEMNIFICATION

     

    Procedure for
Payment.  To
obtain indemnification for Liabilities under this Agreement, the Indemnitee
shall submit to the Company a written request for payment, including with such
request such documentation as is reasonably available to the Indemnitee and
reasonably necessary to determine whether, and to what extent, the Indemnitee is
entitled to indemnification and payment hereunder.  The Secretary of
the Company, or such other person as shall be designated by the Board of
Directors, promptly upon receipt of a request for indemnification shall advise
the Board of Directors, in writing, of such request. Any indemnification payment
due hereunder shall be paid by the Company within twenty (20) days of Indemnitee
submitting such a request for payment, unless in such twenty (20) day period the
Company notifies the Indemnitee that the Board of Directors has determined that
Indemnitee is not entitled to indemnification under this Agreement, in which
case such indemnification payment shall be paid by the Company no later than ten
(10) days following any subsequent determination, pursuant to this Article VI
that such indemnification payment is proper hereunder.

     

    No Determination Necessary
when the Indemnitee was Successful.  To
the extent the Indemnitee has been successful, on the merits or otherwise, in
defense of any Proceeding referred to in Sections 4.2 or 4.3
above or in the defense of any claim, issue or matter described therein, the
Company shall indemnify the Indemnitee against Liabilities and Expenses actually
and reasonably incurred by or for him in connection with the investigation,
defense or appeal of such Proceeding.

     

    Determination of Good Faith
Act or Omission.  In
the event that Section
6.2 is inapplicable, the Company also shall hold harmless and indemnify
the Indemnitee unless the Company shall prove by clear and convincing evidence
to a quorum of the Board consisting of Disinterested Directors that the act(s)
or omission(s) of the Indemnitee giving rise to the Proceeding were not Good
Faith Act(s) or Omission(s).  In such a circumstance, the Indemnitee
shall then have the right to appeal the decision of the Board to a panel of
arbitrators as provided in Section
6.4.

     

    
      
         

      

      
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    Right to
Appeal.  The
Indemnitee shall be entitled to appeal the Company’s decision under Section 6.3 that the
Indemnitee is not entitled to indemnification before a panel of three
arbitrators one of whom is selected by the Company, another of whom is selected
by the Indemnitee and the last of whom is selected jointly by the first two
arbitrators so selected.  As soon as practicable, and in no event
later than thirty (30) days after written notice of the Indemnitee’s decision to
appeal pursuant to this Section 6.4, the
Company shall, at its own expense, submit to the arbitration panel in such
manner as the Indemnitee or the Indemnitee’s counsel may reasonably request, its
claim that the Indemnitee is not entitled to indemnification, and the Company
shall act in the utmost good faith to assure the Indemnitee a complete
opportunity to defend against such claim.  The fees and expenses of
the arbitration panel contemplated hereunder shall be paid by the
Company.  If the Company shall fail to submit the matter to the
arbitration panel within thirty (30) days after the Indemnitee’s written notice
or if the arbitration panel shall have failed to make the requested
determination within thirty (30) days after the matter has been submitted to it
by the Company, the requisite determination that the Indemnitee has the right to
indemnification shall be deemed to have been made.

     

    Right to Judicial Review of
Arbitration Panel Decision.  Notwithstanding
a determination by an arbitration panel listed in Section 6.4 above that the
Indemnitee is not entitled to indemnification with respect to a specific
Proceeding, the Indemnitee shall have the right to apply to the court in which
that Proceeding is or was pending, or to a court  in the State of
Delaware, for the purpose of enforcing the Indemnitee’s right to indemnification
pursuant to this Agreement.  Such enforcement action shall consider
the Indemnitee’s entitlement to indemnification on the record presented to the
arbitration panel, but the Indemnitee shall not be prejudiced by reason of a
prior determination that the Indemnitee is not entitled to
indemnification.  The Company shall be precluded from asserting that
the procedures and presumptions of this Agreement are not valid, binding and
enforceable.  The Company further agrees to stipulate in any such
judicial proceeding that the Company is bound by all the provisions of this
Agreement and is precluded from making any assertion to the
contrary.

     

    Right to Seek Judicial
Determination.  Notwithstanding
any other provision of this Agreement to the contrary, at any time after sixty
(60) days after a request for indemnification has been made to the Company (or
upon earlier receipt of written notice that a request for indemnification has
been rejected) and within one (1) year after the making of such indemnification
request, the Indemnitee may petition the court in which that Proceeding is or
was pending or a court in the State of Delaware, to determine whether the
Indemnitee is entitled to indemnification hereunder, and such court thereupon
shall have the exclusive authority to make such determination, unless and until
such court dismisses or otherwise terminates the Indemnitee’s action without
having made such determination.  The court, as petitioned, shall make
an independent determination of whether the Indemnitee is entitled to
indemnification hereunder, without regard to any prior determination in any
other forum as provided hereby.

     

    
      
         

      

      
        A-8

        
          

        

      

      
         

      

    

     

    Expenses under this
Agreement.  Notwithstanding
any other provision in this Agreement to the contrary, the Company shall
indemnify the Indemnitee against all Expenses incurred by the Indemnitee in
connection with any hearing or proceeding under this Article VI involving the
Indemnitee if the Indemnitee is successful in such claim and against all
Expenses incurred by the Indemnitee in connection with any other action between
the Company and the Indemnitee involving the interpretation or enforcement of
the rights of the Indemnitee under this Agreement, if it is determined that the
Indemnitee was entitled to indemnification in whole or in part
thereunder.

     

    PRESUMPTIONS
AND EFFECT OF CERTAIN PROCEEDINGS

     

    Burden of
Proof.  In
making a determination with respect to entitlement to indemnification hereunder,
the person, persons, entity or entities making such determination shall presume
that the Indemnitee is entitled to indemnification under this Agreement and the
Company shall have the burden of proof to overcome that
presumption.

     

    Effect of Other
Proceedings.  The
termination of any Proceeding or of any claim, issue or matter therein, by
judgment, order or settlement shall not create a presumption that the act(s) or
omission(s) giving rise to the Proceeding were not Good Faith Act(s) or
Omission(s).  The termination of any Proceeding by conviction shall
create a rebuttable presumption that the act(s) or omission(s) of the Indemnitee
giving rise to the Proceeding were not Good Faith Act(s) or
Omission(s).

     

    Reliance as Safe
Harbor.  For
purposes of any determination of whether any act or omission of the Indemnitee
was a Good Faith Act or Omission, each act of the Indemnitee shall be deemed to
be a Good Faith Act or Omission if the Indemnitee’s action is based on the
records or books of accounts of the Company, including financial statements, or
on information supplied to the Indemnitee by the officers of the Company in the
course of their duties, or on the advice of legal counsel for the Company or on
information or records given or reports made to the Company by an independent
certified public accountant or by an appraiser or other expert selected with
reasonable care by the Company.  The provisions of this Section 7.3 shall not
be deemed to be exclusive or to limit in any way the other circumstances in
which the Indemnitee may be deemed to have met the applicable standard of
conduct set forth in this Agreement or under applicable law.

     

    Actions of
Others.  The
knowledge and/or actions, or failure to act, of any other director, officer,
Founder, agent or employee of the Company shall not be imputed to the Indemnitee
for purposes of determining the right to indemnification under this
Agreement.

     

    INSURANCE

    

    The
Company shall maintain officers’ and directors’ or similar liability insurance,
reasonable and consistent with industry standards for companies of the Company’s
size and type, to protect itself and any director or officer of the Company
against any expense, liability or loss, and such insurance shall cover the
Indemnitee to at least the same degree as each other director and/or officer of
the Company.  The Company shall give prompt notice to the insurer or
insurers providing such officers’ and directors’ or similar liability insurance
of the commencement of a potentially covered proceeding in accordance with the
provisions set forth in the respective policies.  The Company shall
thereafter take all necessary or desirable action to cause such insurers to pay
on behalf of Indemnitee all amounts payable as a result of such proceeding in
accordance with the terms of such policies.

     

    
      
         

      

      
        A-9

        
          

        

      

      
         

      

    

    

    MISCELLANEOUS

     

    Non-Exclusivity.  The
rights of the Indemnitee hereunder shall be in addition to any other rights to
which the Indemnitee may at any time be entitled under any provision of law or
the Articles of Incorporation or the Bylaws of the Company, as the same may be
in effect from time to time, or any agreement, a vote of shareholders of the
Company or a resolution of directors of the Company or otherwise, and to the
extent that during the term of this Agreement the rights of the then-existing
directors and officers of the Company are more favorable to such directors or
officers than the rights currently provided to the Indemnitee under this
Agreement, the Indemnitee shall be entitled to the full benefits of such more
favorable rights.  No amendment, alteration, rescission or replacement
of this Agreement or any provision hereof which would in any way limit the
benefits and protections afforded to an Indemnitee hereby shall be effective as
to such Indemnitee with respect to any action or inaction by such Indemnitee in
the Indemnitee’s Corporate Status prior to such amendment, alteration,
rescission or replacement.

     

    Subrogation.  In
the event of any payment under this Agreement, the Company shall be subrogated
to the extent of such payment to all of the rights of recovery of the
Indemnitee, who shall execute all documents required and take all action
necessary to secure such rights, including execution of such documents as are
necessary to enable the Company to bring suit to enforce such
rights.

     

    Notices. All
notices, requests, demands and other communications hereunder shall be in
writing and shall be deemed to have been duly given (i) if delivered by hand, by
courier or by telegram and receipted for by the party to whom said notice or
other communication shall have been directed at the time indicated on such
receipt; (ii) if by facsimile at the time shown on the confirmation of such
facsimile transmission; or (iii) if by U.S. certified or registered mail, with
postage prepaid, on the third business day after the date on which it is so
mailed:

     

    
      
         

      

      
        A-10

        
          

        

      

      
         

      

    

     

    
      
        	
                If
      to the Indemnitee:

              	
                As
      shown with the Indemnitee’s signature below.

              
	 
      	 
      
	
                If
      to the Company, to:

              	
                Vitacost.com,
      Inc.

                5400
      Broken Sound Blvd

                #500

                Boca
      Raton, FL 33487

                Attention:        Chief
      Financial Officer

              

      

    

    

    or to
such other address as may have been furnished to the Indemnitee by the Company
or to the Company by the Indemnitee, as the case may be.

     

    Consent to
Jurisdiction.  The
Company and the Indemnitee each hereby irrevocably consent to the jurisdiction
of the courts of the State of Delaware for all purposes in connection with any
action or proceeding which arises out of or relates to this Agreement and agree
that any action instituted under this Agreement shall be brought only in the
state courts of the State of Delaware.

     

    Governing
Law.  The
parties agree that this Agreement shall be governed by, and construed and
enforced in accordance with, the substantive laws of the State of Delaware,
without application of the conflict of laws principles thereof.

     

    Binding
Effect.  Except
as otherwise provided in this Agreement, this Agreement shall be binding upon
and inure to the benefit of and be enforceable by the parties hereto and their
heirs, executors, administrators, successors, legal representatives and
permitted assigns.  The Company shall require any successor or
assignee (whether direct or indirect, by purchase, merger, consolidation or
otherwise) to all or substantially all of its respective assets or business, by
written agreement in form and substance reasonably satisfactory to the
Indemnitee, to assume and agree to be bound by and to perform this Agreement in
the same manner and to the same extent as the Company would be required to
perform absent such succession or assignment.  This Agreement shall
continue in effect regardless of whether Indemnitee continues to serve as an
executive officer, director, employee, agent or other representative of the
Company.  Notwithstanding anything to the contrary contained herein,
this Agreement may be terminated or amended by the Company with the written
consent of not less than seventy-five percent (75%) of the Pre-Change in Control
Directors.

     

    Waiver.  No
termination, cancellation, modification, amendment, deletion, addition or other
change in this Agreement, or any provision hereof, or waiver of any right or
remedy herein, shall be effective for any purpose unless specifically set forth
in a writing signed by the party or parties to be bound thereby.  The
waiver of any right or remedy with respect to any occurrence on one occasion
shall not be deemed a waiver of such right or remedy with respect to such
occurrence on any other occasion.

     

    Entire
Agreement.  This
Agreement, constitutes the entire agreement and understanding among the parties
hereto in reference to the subject matter hereof; provided, however, that the
parties acknowledge and agree that the Articles of Incorporation of the Company
contain provisions on the subject matter hereof and that this Agreement is not
intended to, and does not, limit the rights or obligations of the parties hereto
pursuant to such Articles of Incorporation.

     

    
      
         

      

      
        A-11

        
          

        

      

      
         

      

    

     

    Titles.  The
titles to the articles and sections of this Agreement are inserted for
convenience of reference only and should not be deemed a part hereof or affect
the construction or interpretation of any provisions hereof.

     

    Severability.  Every
provision of this Agreement is severable.  In the event that the
invalidity or any term or provision (including any provision within a single
section, paragraph or section) is held by a court of competent jurisdiction to
be invalid, void or otherwise unenforceable, the remaining terms and provisions
shall remain enforceable to the fullest extent permitted by
law.  Furthermore, to the fullest extent possible, the provisions of
this Agreement (including, without limitation, each portion of this Agreement
containing any provision held to be invalid, void or otherwise unenforceable,
that is not itself invalid, void or otherwise enforceable) shall be construed so
as to give effect to the intent manifested by the provision held invalid,
illegal or unenforceable.

     

    Counterparts.  This
Agreement may be executed in two or more counterparts, each of which shall be
deemed an original, but all of which together constitute one agreement binding
on all the parties hereto.

     

    IN WITNESS WHEREOF, the
parties hereto have executed this Agreement as of the day and year first above
written.

     

    
      	
              COMPANY:

            	 
      	
              INDEMNITEE:

            
	 
      	 
      	 
      
	
              Vitacost.com,
      Inc., a Delaware corporation

            	 
      	 
      
	 
      	 
      	 
      
	
              By:

            	 
      	 
      	 
      
	
              Its:

            	 
      	 
      	
              STEPHEN
      MARKERT

            
	 
      	 
      	 
      
	 
      	 
      	
              Address:

            	 
      
	 
      	 
      	 
      	 
      

    

    
      
         

      

      
        A-12Unassociated Document

    Exhibit
10.1

    

    SETTLEMENT AGREEMENT AND
GENERAL RELEASE

    
      

    

    
      THIS
SETTLEMENT AGREEMENT AND GENERAL RELEASE ("Agreement") is made as of the 13th
day of October, 2010 between WES CONSULTING, INC. (“WES”), on the one hand, and
BELMONT PARTNERS, LLC (“Belmont”), on the other hand, each of whom may hereafter
be referred to as the “Parties.”

    

    
      

    

    
      RECITALS

    

    
      

    

    
      A.           WES
owes Belmont 750,000 shares of WES common stock pursuant to that certain Common
Stock Purchase Agreement dated September 2, 2009 by and among Liberator, Inc.
and the Parties (the “Equity Issuance”);

      

      B.           WES
alleges that Belmont may have violated the short swing profit rules enacted
under Section 16(b) of The Securities Exchange of Act of 1934 (the “Section 16
Claim”).

      

      C.           Belmont
denies that it has violated the short swing profit rules enacted under Section
16(b) of the Securities Exchange Act of 1934.

      

      D.           The
Parties wish to reach an amicable solution in order to avoid the costs and
uncertainties of protracted and time consuming litigation, therefore, the
Parties have agreed that the Equity Issuance owed to Belmont by WES will be
considered as satisfied in full by Belmont with the issuance of three hundred
fifty thousand (350,000) restricted shares of WES common stock (the
“Shares”).

      

      D.           The
parties wish to compromise and forever settle the Equity Issuance and the
Section 16 Claim between them pursuant to the terms of this
Agreement.

    

    
      

    

    
      AGREEMENT

    

    
      

    

    
      NOW,
THEREFORE, for good and valuable consideration, the receipt of which is hereby
acknowledged, and in consideration of the mutual promises, covenants and
conditions herein contained, the Parties agree as follows:

    

    
      

    

    
      1.           Settlement
Payment.  Upon full execution of this Agreement, WES shall
issue the Shares to Belmont or its assignee(s) in full satisfaction of the
Equity Issuance. The 350,000 Shares shall be unregistered, but shall otherwise
have no restriction (the “Restricted Shares”). The Restricted Shares shall be
issued in the name of Belmont Partners, LLC.

      

      2.           Release.   Except
for the rights and obligations of Belmont arising from this Agreement, WES
hereby, for itself and its officers, directors, employees, agents, partners,
members, representatives, predecessors, successors, insurers and assigns,
discharge and release Belmont, and its respective past and present employees,
officers, directors, affiliates, subsidiaries, partners, shareholders, agents,
executors, administrators, trustees, heirs, spouses, attorneys, insurers,
representatives, assigns, predecessors, successors and related entities (the
“Belmont Released Parties”), from any and all claims, damages, actions,
judgments, obligations, attorneys' fees, indemnities, subrogations, duties,
demands, controversies and liabilities of every nature at law or in equity,
liquidated, or unliquidated, known or unknown, matured or unmatured, foreseeable
or unforeseeable, which they had or have arising out of any circumstance, thing,
or event alleged, related or pertaining to a Section 16 Claim against a Belmont
Released Party, or the Equity Issuance.

    

    
       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

       

    

    
      3.           Entire
Agreement.  This Agreement contains the sole, complete and
entire agreement and understanding of the Parties concerning the matters
contained herein and may not be altered, modified, or changed in any manner
except by a writing duly executed by the Parties.  No Party is relying
on any representations other than those expressly set forth
herein.  No conditions precedent to the effectiveness of this
Agreement exist, other than as expressly provided for herein.  All
prior discussions and negotiations have been and are merged, integrated into and
superseded by this Agreement.

    

    
      

    

    
      4.           Waiver.  The
delay or failure of a Party to exercise any right, power or privilege hereunder,
or failure to strictly enforce any breach or default shall not constitute a
waiver with respect thereto; and no waiver of any such right, power, privilege,
breach or default on any one occasion shall constitute a waiver thereof on
subsequent occasion unless clear and express notice thereof in writing is
provided.

    

    
      

    

    
      5.           Attorneys’ Fees Upon
Breach.  If any action at law or in equity, or any motion, is
brought to enforce this Agreement, the prevailing Party shall be entitled to all
of its costs in bringing and prosecuting said action or motion, including
reasonable attorneys’ fees.

    

    
      

    

    
      6.           Applicable
Law.  This Agreement shall be construed according to the laws
of the State of Georgia in effect as of the date of
execution.

    

    
      

    

    
      7.           Advice of
Counsel.  The Parties represent that prior to the execution of
this Agreement they had the opportunity to seek the benefit of independent legal
counsel of their own selection regarding the substance of this
Agreement.

    

    
      

    

    
      8.           No
Liability.  This Agreement is executed by the Parties hereto
for the sole purpose of settling the matters involved in the dispute, and it is
expressly understood and agreed, as a condition hereof, that this Agreement
should not constitute nor be construed to be an admission of the truth or
correctness of any claim asserted.

    

    
      

    

    
      9.           Warranties.  The
Parties, and each of them, warrant, severally and not jointly:  (i)
that no other person or entity had or has or claims, any interest in any of the
claims, demands, causes of action, or damages covered in this Agreement; (ii)
that they, and each of them, have the sole right and exclusive authority to
execute and perform this Agreement; (iii) that they have not sold, assigned,
transferred, conveyed or otherwise disposed of any claim, demand, cause of
action, obligation, damage or liability covered in this Agreement; and (iv) that
they have not filed any complaints, charges or other actions against any other
Party with any local, state or federal agency or court, or any other
forum.

    

    
       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

       

    

    
      10.           Representation of
Authority.  Each individual executing this Agreement on behalf
of any Party expressly represents and warrants that he has authority to execute
and thereby bind the Party on behalf of which he executes this Agreement to the
terms of this Agreement and agrees to indemnify and hold harmless each other
party from any claim that such authority did not exist.

    

    
      

    

    
      11.           Headings.  The
headings included in this Agreement are for convenience only and do not limit,
alter, or affect the matters contained in this Agreement or the paragraphs they
encaption.

    

    
      

    

    
      12.           Counterparts.  This
Agreement may be executed in one or more counterparts, all of which together
constitute one single document.

    

    
      

    

    
      13.           Telefacsimile
Signatures.  This Agreement and any documents relating to it
may be executed and transmitted to any other Party by telefacsimile, which
telefacsimile shall be deemed to be, and utilized in all respects as, an
original, wet-inked document.

    

    
      

    

    
      14.           Date of
Execution.  The Parties execute this Agreement as of the date
first above set forth.

      

    

    
      15.           Further
Cooperation.  The Parties agree to cooperate with one another
to accomplish the purposes of this Settlement Agreement.

    

    
      

    

    
      16.           No
Assignment.  The Parties agree that neither this Agreement, nor
any rights or obligations created hereunder, may be assigned or transferred
without the prior written consent of the Party or Parties affected, and any
attempt to do so without such consent shall be null and void.

    

    
      

      WES
CONSULTING, INC.

      

      

      

      By:  /s/
Louis S. Friedman

      Louis
Friedman, CEO

      

      BELMONT
PARTNERS, LLC

      

      

      By:  /s/
Christan Dobbins

      Christan
Dobbins, General Counsel

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