Document:

ex4-2.htm

IVOICE, INC.

2008 Directors’ and Officers’ Stock Incentive Plan

1.     PURPOSES.

The purpose of the iVoice, Inc. 2008 Directors’ and Officers’ Stock Incentive Plan (the "Plan") is to (i) provide long-term incentives and rewards to officers and directors ("Eligible Participants") of iVoice, Inc. ("the Company") and its subsidiaries; (ii) assist the Company in attracting and retaining officers and directors
with experience and/or ability on a basis competitive with industry practices; and (iii) associate the interests of such employees, directors, independent contractors or agents with those of the Company's stockholders.

2.     EFFECTIVE  DATE.

The Plan is effective as of the date it is adopted by the Board of Directors of the Company and Awards may be made under the Plan on and after its effective date.

3.     ADMINISTRATION  OF  THE  PLAN.

The Plan shall be administered by the Board of Directors or a committee appointed by the Board of Directors of the Company (hereinafter referred to as the “Board”) and the Board shall be so constituted as to permit the Plan to comply with the disinterested administration requirements under Rule 16b-3 of the Securities Exchange
Act of 1934, as amended (the "Exchange Act"), and the "outside director" requirement of Section 162(m) of the Internal Revenue Code of 1986, as amended (the "Code").

The Board shall have all the powers vested in it by the terms of the Plan, such powers to include exclusive authority (within the limitations described herein) to select the Eligible Participants to be granted awards under the Plan, to determine the type, size and terms of awards to be made to each Eligible Participant selected, to determine
the time when awards will be granted, when they will vest, when they may be exercised and when they will be paid, to amend awards previously granted and to establish objectives and conditions, if any, for earning awards and whether awards will be paid after the end of the award period. The Board shall have full power and authority to administer and interpret the Plan and to adopt such rules, regulations, agreements, guidelines and instruments for the administration of the Plan and for the conduct of its business
as the Board deems necessary or advisable and to interpret same.  The Board's interpretation of the Plan, and all actions taken and determinations made by the Board pursuant to the powers vested in it hereunder, shall be conclusive and binding on all parties concerned, including the Company stockholders, any participants in the Plan and any other Eligible Participant of the Company.

All employees of the Company and all employees of Affiliates shall be eligible to participate in the Plan.  The Board, in its sole discretion, shall from time to time designate from among the eligible employees and among directors, independent contractors or agents those individuals who are to receive awards under and thereby
become participants in the Plan.  For purposes of the Plan, "Affiliate" shall mean any entity, as may from time to time be designated by the Board, that is a subsidiary corporation of the Company (within the meaning of Section 424 of the Code), and each other entity directly or indirectly controlling or controlled by or under common control with the Company.  For purposes of this definition, "control" means the power to direct the management and policies of such entity, whether through the
ownership of voting securities, by contract or otherwise; and the terms "controlling" and "controlled" have meaning correlative to the foregoing.

4.     AWARDS.

(a) Types.  Awards under the Plan shall be made with reference to shares of the Company common stock and may include, but need not be limited to, stock options (including non-statutory stock options and incentive stock options qualifying under Section 422 of the Code), stock appreciation rights (including free-standing, tandem
and limited stock appreciation rights), warrants, dividend equivalents, stock awards, restricted stock, phantom stock, performance shares or other securities or rights that the Board determines to be consistent with the objectives and limitations of the Plan. The Board may provide for the issuance of shares of the Company common stock as a stock award for no consideration other than services rendered or, to the extent permitted by applicable state law, to be rendered.  In the event of an award under
which shares of the Company common stock are or may in the future be issued for any other type of consideration, the amount of such consideration shall (i) be equal or greater than to the amount (such as the par value of such shares) required to be received by the Company in order to assure compliance with applicable state law and (ii) to the extent necessary to comply with Rule 16b-3 of the Exchange Act, be equal to or greater than 50% of the fair market value of such shares on the date of grant of such award.
The Board may make any other type of award which it shall determine is consistent with the objectives and limitations of the Plan.

(b) Performance Goals.  The Board may, but need not, establish performance goals to be achieved within such performance periods as may be selected by it in its sole discretion, using such measures of the performance of the Company and/or its Affiliates as it may select.

(c) Rules and Policies.  The Board may adopt from time to time written rules and policies implementing the Plan.  Such rules and policies may include, but need not be limited to, the type, size and term of awards to be made to participants and the conditions for the exercise or payment of such awards.

5.     SHARES OF STOCK SUBJECT TO THE PLAN.

The shares that may be delivered or purchased or used for reference purposes under the Plan shall not exceed an aggregate of twenty percent (20%) of the issued and outstanding shares of the Company’s Class A Common Stock, no par value per share, as determined by the Board from time to time.  Any shares subject to an award
which for any reason expires or is terminated unexercised as to such shares shall again be available for issuance under the Plan.

 

 

 

 

6.     PAYMENT OF AWARDS.

The Board shall determine the extent to which awards shall be payable in cash, shares of the Company common stock or any combination thereof.  The Board may determine that all or a portion of a payment to a participant under the Plan, whether it is to be made in cash, shares of the Company common stock or a combination thereof
shall be deferred.  Deferrals shall be for such periods and upon such terms as the Board may determine in its sole discretion.

7.     VESTING.

The Board may determine that all or a portion of a payment to a participant under the Plan, whether it is to be made in cash, shares of the Company common stock or a combination thereof, shall be vested at such times and upon such terms as may be selected by it in its sole discretion.

8.     DILUTION  AND  OTHER  ADJUSTMENT.

In the event of any change in the outstanding shares of the Company common stock by reason of any split, stock dividend, recapitalization, merger, consolidation, spin-off, reorganization, combination or exchange of shares or other similar corporate change, such equitable adjustments shall be made in the Plan and the awards thereunder as
the Board determines are necessary or appropriate, including, if necessary, any adjustments in the number, kind or character of shares that may be subject to existing or future awards under the Plan (including by substitution of shares of another corporation including, without limitation, any successor of the Company ), adjustments in the exercise, purchase or base price of an outstanding award and any adjustments in the maximum numbers of shares referred to in Section 4 or Section 5 of the Plan. All such adjustments
shall be conclusive and binding for all purposes of the Plan.

9.     MISCELLANEOUS PROVISIONS.

(a) Rights as Stockholder.  A participant under the Plan shall have no rights as a holder of the Company common stock with respect to awards hereunder, unless and until certificates for shares of such stock are issued to the participant.

(b) Assignment to Transfer.  No award under this Plan shall be transferable by the participant or shall be subject to any manner of alienation, sale, transfer, assignment, pledge, encumbrance or charge (other than by or to the Company), except (i) by will or the laws of the descent and distribution (with all references herein
to the rights or duties of holders or participants to be deemed to include such beneficiaries or legal representatives of the holders or participant unless the context otherwise expressly requires); (ii) subject to the prior approval of the Board, for transfers to members of the participant's immediate family, charitable institutions, trusts whose beneficiaries are members of the participant's immediate family and/or charitable institutions, trusts whose beneficiaries are members of the participant's immediate
family and/or charitable institutions, or to such other persons or entities as may be approved by the Board in each case subject to the condition that the Board be satisfied that such transfer is being made for the estate and/or tax planning purposes on a gratuitous or donative basis and without consideration (other than nominal consideration) being received therefor. Except as provided above, during the lifetime of a participant, awards hereunder are exercisable only by, and payable only to, the participant.

(c) Agreements.  All awards granted under the Plan shall be evidenced by agreements in such form and containing such terms and conditions (not inconsistent with the Plan) as the Board shall adopt.

(d) Compliance with Legal Regulations.  During the term of the Plan and the term of any awards granted under the Plan, the Company will at all times reserve and keep available such number of shares as may be issuable under the Plan, and will seek to obtain from any regulatory body having jurisdiction, any requisite authority required
in the opinion of counsel for the Company in order to grant shares of the Company common stock, or options to purchase such stock or other awards hereunder, and transfer, issue or sell such number of shares of common stock as shall be sufficient to satisfy the requirements of any options or other awards. If in the opinion of counsel for the Company the transfer, issue or sale of any shares of its stock under the Plan shall not be lawful for any reason including the inability of the Company to obtain from any
regulatory body having jurisdiction authority deemed by such counsel to be necessary to such transfer, issuance or sale, the Company shall not be obligated to transfer, issue or sell any such shares.  In any event, the Company shall not be obligated to transfer, issue or sell any shares to any participant unless a registration statement which complies with the provisions of the Securities Act of 1933, as amended (the "Securities Act"), is in effect at the time with respect to such shares or other appropriate
action has been taken under and pursuant to the terms and provisions of the Securities Act and any other applicable securities laws, or the Company receives evidence satisfactory to the Board that the transfer, issuance or sale of such shares, in the absence of an effective registration statement or other appropriate action, would not constitute a violation of the terms and provisions of the Securities Act. the Company's obligation to issue shares upon the exercise of any award granted under the Plan shall in
any case be subject to the Company being satisfied that the shares purchased are being purchased for investment and not with a view to the distribution thereof, if at the time of such exercise a resale of such shares would otherwise violate the Securities Act in the absence of an effective registration statement relating to such shares.

(e) Withholding Taxes.  the Company shall have the right to deduct from all awards hereunder paid in cash any federal, state, local or foreign taxes required by law to be withheld with respect to such awards and, with respect to awards paid in stock, to require the payment (through withholding from the participant's salary or
otherwise) of any such taxes.  The obligation of the Company to make delivery of awards in cash or the Company common stock shall be subject to currency or other restrictions imposed by any government.

(f) No Rights to Award.  No Eligible Participant or other person shall have any right to be granted an award under the Plan.  Neither the Plan nor any action taken hereunder shall be construed as giving any employee any right to be retained in the employ of the Company or any of its subsidiaries or shall interfere with
or restrict in any way the rights of the Company or its subsidiaries, which are hereby reserved, to discharge the employee at any time for any reason whatsoever, with or without good cause.

 

 

 

 

(g) Costs and Expenses.  The costs and expenses of administering the Plan shall be borne by the Company and not charged to any award or to any Eligible Participant receiving an award.

(h) Funding of Plan.  The Plan shall be unfunded.  the Company shall not be required to establish any special or separate fund or to make any other segregation of assets to assure the payment of any award under the Plan.

10.    AMENDMENTS AND TERMINATION.

(a) Amendments.  The Board may at any time terminate or from time to time amend the Plan in whole or in part, but no such action shall adversely affect any rights or obligations with respect to any awards theretofore made under the Plan.

Unless the majority of the directors of the Company present, or represented, and entitled to vote at a meeting of directors shall have first approved thereof, no amendment of the Plan shall be effective which would (i) increase the maximum number of shares referred to in section 5 of the Plan or the maximum awards that may be granted pursuant
to section 4 of the Plan to any one individual or (ii) extend the maximum period during which awards may be granted under the Plan.  For purposes of this section 10 (a), any (A) cancellation and re-issuance or (B) repricing of any awards made under the Plan at a new option price shall not constitute an amendment of this Plan.

With consent of the Eligible Participant adversely affected, the Board may amend outstanding agreements evidencing awards under the Plan in a manner not inconsistent with the terms of the Plan.

(b) Termination.  Unless the Plan shall theretofore have been terminated as above provided, the Plan (but not the awards theretofore granted under the Plan) shall terminate on and no awards shall be granted after November 20, 2018.First Amendment to Employment, Non-Competition and Proprietary Rights Agreement

 Exhibit 10.31 
 FIRST AMENDMENT TO EMPLOYMENT, NON-COMPETITION 
 AND PROPRIETARY RIGHTS AGREEMENT 
 This First Amendment (“Amendment”) dated as of June 30, 2009 amends that certain Employment, Non-Competition and
Proprietary Agreement (the “Agreement”) effective as of the 29th day of
January, 2007, by and between VITACOST.COM, INC., a Delaware corporation (the “Company”), and IRA KERKER (the “Employee”). Capitalized terms used herein
and not otherwise defined shall have the same meaning as set forth in the Agreement. 
 RECITALS: 
 A. The Company has filed an S-1/A Registration Statement with the Securities & Exchange Commission in order to effect a public offering of
certain shares of its Common Stock and is desirous of entering into this Amendment to adequately compensate him for his additional responsibilities as a result of the proposed public offering and the additional business activities that will be
associated with the Company’s ongoing operations. 
 B. Employee is desirous of amending the Agreement and of continuing to perform
services on behalf of the Company to the best of his abilities. 
 NOW, THEREFORE, in consideration of the foregoing and the agreements,
covenants and conditions set forth herein, the Employee and the Company hereby agree as follows: 
 1. Termination. Sections 2.4
(a) and (c) of the Agreement are amended and restated in its entirety as follows: 
 (a) Voluntary Termination/Termination For
Cause. Upon: (i) termination of the Employee’s employment pursuant to Sections 2.2(c) of (f); or due to Employee’s resignation other than pursuant to Section 2.2(c); or (ii) the expiration of the Employment
Term pursuant to Section 2.2(d), because the Employee elects not to extend the Employment Term, Employee shall be entitled to receive his base salary, bonus, benefits and expense reimbursements solely through the date of termination.

 (c) Without Cause. If Employee’s employment is terminated Without Cause, pursuant to
Section 2.2(e), Employee will be entitled to receive an amount equal to the sum of: (i) 2.5 times his then-current annual base salary; plus (ii) the “Accrued Vacation and Bonus” (collectively, the “Severance
Payment”), to be paid in 24 equal monthly installments (each of 1/24th of the
total Severance Payment), with the first payment to be made on the first business day of the month immediately following the month in which Employee’s employment was terminated Without Cause, and continuing on the next 23 months thereafter.
With respect to computing the Severance Payment, Employee’s “Accrued Vacation and Bonus” shall be an amount equal to the sum of: (i) any of his unused vacation pay for the calendar year in question (to the extent that the
percentage of the calendar year elapsed in the year through the termination date (the “Termination Percentage”) multiplied by the number of vacation days to which Employee was entitled for the full year is greater than the number of days
of vacation actually taken by Employee during such calendar year through the date of termination of employment; plus (ii) an amount equal to the aggregate cash bonus earned by Employee in the year immediately preceding the year in which
employment is terminated multiplied by the Termination Percentage. 

 Provided that Employee makes a timely election to continue coverage under the Company’s group health plans pursuant
to the Consolidated Omnibus Budget Reconciliation Act of 1985 (“COBRA”), health insurance benefits with the same coverage (subject to Company’s right to change coverage as set forth in the last sentence of this Section) provided to
Employee prior to the termination (e.g. medical, dental, optical, mental health) will be provided at the Company’s cost for eighteen (18) months following the termination date, but not longer than until Employee is covered by comparable
health insurance benefits from another employer or is otherwise ineligible for COBRA continuation coverage. Nothing contained herein shall restrict the ability of the Company or its successor from changing some or all of the terms of such health
insurance benefits, the cost to participants or other features of such benefits; provided, however, that all similarly situated participants are treated the same. 
 2. Definition of Cause. The definition of “Cause” in Section 2.7(a) of the Agreement is amended and restated as follows: 
 (a) “Cause” for Employee’s termination will exist if the Company terminates Employee’s employment for any of the following reasons:
(i) Employee willfully fails to substantially perform his duties hereunder delegated to him directly by the Company’s Board of Directors (other than any such failure due to his physical or mental illness), and such willful failure is not
remedied within ten (10) business days after written notice from the Company’s Board of Directors, which written notice shall state that failure to remedy such conduct may result in an involuntary termination for Cause; (ii) Employee
engages in willful and serious misconduct (including, but not limited to, an act of fraud or embezzlement) that has caused or is reasonably expected to result in material injury to the Company or any of its Affiliates; (iii) Employee is
convicted of or enters a plea of guilty or nolo contendere to a: (A) crime that materially adversely affects his ability to perform his duties on behalf of the Company; or (B) felony; (iv) Employee engages in alcohol or substance
abuse which adversely affects his ability to perform his duties. 
 3. Vesting and Options. Section 3.5 of the Agreement is
amended and restated in its entirety as follows: 
 3.5 Vesting and Options. As of June 1, 2009, Employee holds the following
options of the Company (collectively, the “Existing Options”) and had as of that date no other rights to any other options to purchase stock of the Company: 
  

					
	 # Shares
	  	 Exercise Price
	  	Expiration Date
	100,000	  	$2.50	  	2/13/15
	25,000	  	$3.00	  	5/13/15
	125,000	  	$3.00	  	12/10/15
	25,000	  	$3.00	  	12/11/16
	162,500	  	$6.00	  	12/30/17

  

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 The Company has filed a registration statement and amendments thereto with the Securities &
Exchange Commission for an initial public offering (“IPO”) of the common stock of the Company. Effective as of the time of the initial closing of the IPO, provided Employee’s employment with the Company has not previously been
terminated (for any reason), Employee shall be granted an option to purchase an additional 250,000 shares of common stock of the Company, subject to adjustment after the date of this Amendment for any forward or reverse splits of the common stock of
the Company (the “New Option”) for a term of 10 years, exercisable at the same price per share as the shares of common stock are sold in the IPO, fully vested, nonforfeitable and with a right to exercise the New Option at any time over its
term; irrespective of whether Employee remains in the employ of the Company. Effective as of the time of the initial closing of the IPO, provided Employee has not previously voluntarily resigned from employment with the Company, Employee’s
Existing Options shall be modified, to the extent necessary, so that they will all be fully vested as of the date of this Amendment, nonforfeitable and with a right to exercise the Existing Options at any time over their remaining terms,
irrespective of whether Employee remains in the employ of the Company. 
 4. Miscellaneous. 
 (a) Notice. The address for notification to the Company with respect to this Agreement is hereby changed as follows: 
  

							
		 	 To Company at:
	  	 Vitacost.com Inc.
 5400 Broken Sound Blvd.
NW – Suite 500
 Boca Raton, Florida 33487

		 		  	 Attention:
 Telephone:
 Facsimile:
 E-Mail:
	  	 Stewart Gitler
 561-982-4180
 561-752-8900 with a copy to 703-418-2768
 sgitler@hwglaw.com

 (b) Arbitration. The fifth sentence of Section 5.7 of the Agreement is amended and
restated as follows: 
 “The arbitrator shall determine which party, if either, prevailed and shall award the prevailing party its or
his costs and legal fees.” 
 (c) Survival. Section 5.12 of the Agreement is amended and restated in its entirety as
follows: 
 5.12 Survival. The parties’ rights and obligations under this Agreement shall survive any termination of this
Agreement. 
 (d) Section 409A Compliance. Article V of the Agreement is amended by adding the following Section 5.13 to the
Article: 
 5.13 Section 409A Compliance. Notwithstanding anything in the Agreement to the contrary, if (i) all or any
portion of any payment or payments to which Employee may be entitled under the terms of the Agreement (each, a “Payment”) constitutes a deferral of compensation subject to Section 409A of the Internal Revenue Code of 1986, as amended
(the “Code”); (ii) the 

  

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applicable Payment is payable (or deemed payable) in connection with a “separation from service” as defined in Section 409A(a)(2)(A)(i) of the
Code and the regulations and other guidance issued thereunder; and (iii) Employee is a “specified employee” as defined in Section 409A(a)(2)(B)(i) of the Code and the regulations and other guidance issued thereunder, then the
applicable Payment shall be made in a lump sum no earlier than the first day of the seventh month following the month in which Employee’s “separation from service” occurs and no later than 15 days thereafter. 
 5. Exhibit A. Exhibit A is amended and restated in its entirety as set forth below the signature block hereof. 
  
  

							
	COMPANY:	  		 	EMPLOYEE:
			
	VITACOST.COM, INC.	  		 	 
		 		  		 	Ira Kerker
				
	 By:
	 	/s/ Stewart Gitler	  		 	/s/ Ira Kerker
		 	Stewart Gitler, Chairman of the Board	  		 	[Signature]
				
		 		  		 	Address:                                     
                                         
              
		 		  		 	Address:                                       
                                         
            
				
		 		  		 	Employee Owned
Inventions:                                       
              

  

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 EXHIBIT A 
 Base Salary: $232,800 per annum. At some time during the period of 120 to 150 days following the initial closing of the IPO, the Company’s compensation committee shall review Employee’s total compensation
package and should the Company determine that it is appropriate to increase any of Employee’s compensation, then the Company shall increase Employee’s compensation accordingly. 
 Bonus: Employee shall be entitled to earn a quarterly bonus not to exceed $17,500, which bonus shall be based upon the Company meeting and/or exceeding both top line and bottom line goals for the quarter. 

Benefits: Employee shall be entitled to receive all offered health benefits for himself and his family, at no additional cost.

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