exv10w21



 





EXHIBIT 10.21




Daryl
Yurek

Managing Director




Bolder Venture Partners




www.bolderventure.com




303.447.2324 phone

303.589.1549 mobile

303.447.2338 fax




Bolder Venture Partners

110 16th Street, Suite 1000

Denver, CO 80202




September 25,
2007




James D. Crapo, Chairman

LifeVantage Corporation

6400 S. Fiddler’s Green Circle

Suite 1970

Greenwood Village, CO 80111




Gentlemen:



You have asked Bolder Venture Partners (“BVP”) to submit a proposal describing the basis on which
it would serve as a corporate advisor to LifeVantage Corporation (“the Company”) for a period of
twelve (12) months, commencing on September 26, 2007 and extending through September 25, 2008
subject to extension by mutual written agreement by the Company and BVP. This letter will serve to
advance your request for such a proposal and confirm BVP’s engagement as one of the Company’s
advisors.




Corporate Development, Management and Sales/Marketing Advisory Services



BVP will be pleased to furnish interim on site corporate management with the assignment of BVP
associate, Gene Copeland, to the position of interim COO (or such title acceptable to the Company’s
board of directors) to provide hands-on development and implementation of an effective direct to
consumer marketing program(s) that will increase overall Company revenues significantly above the
current annual run rate of $3.5 million during the engagement period. To accomplish this sales
growth objective, BVP will provide complete access to other BVP associates including Daryl Yurek
and its Direct Marketing and Media experts, Ross Vigliotti and Eric Hansen. Further, BVP will
conduct an overall evaluation of the Company’s current overhead expenditures and implement change
where necessary. Further, BVP will direct the search activities for identifying and hiring a
permanent CEO / President for the Company. As the Company’s general and sales / marketing
management development advisor, BVP will act on behalf





 









 







of the Company and will provide independent advice of a direct marketing nature pertaining
to this engagement. BVP will report directly to you, the Company’s board, and will keep you
advised of our activities, as you deem appropriate. In carrying out this assignment, BVP will
coordinate its efforts and work closely with other key members of the Company’s management to
assist you and the Company in its overall program to achieve various corporate objectives. The
services and activities BVP anticipates performing over the course of this engagement for the
Company can be generally described as follows:




Provide Interim Corporate Management Services



BVP will provide a senior executive to serve as Interim COO to manage the day-today operations of
the Company. The Interim COO shall evaluate the current overhead structure of the company and
reduce operating expense levels where needed. The Interim President shall implement a proven
direct marketing program with input from BVP’s Direct Marketing and Media experts aimed at
bringing significant increases with specific emphasis in the “direct to consumer” (DTC) sales
channel.



The Interim COO shall coordinate the executive search for a permanent CEO/ President for the
Company.



In summary, BVP will determine the feasibility of new marketplace direct marketing programs,
propose specific plans and programs complete with the associated costs and benefit projections,
assist in permanent CEO / President candidate due diligence and coordinate the hiring, and other
related matters as the Company desires. BVP will review and evaluate all current and future
employee needs, business plans, contractual agreements with retail channel distributors and/or
company spokesmen and make recommendations to preserve, alter or expand.




Compensation Arrangements — Non-Refundable Retainer



In consideration for BVP providing on-site Interim COO, implementation of customer expansion
marketing program(s), and permanent CEO / President recruitment advisor to the Company in this
engagement, BVP will be paid a monthly, non-refundable retainer of fifteen thousand dollars
($15,000) due and payable on the fifteenth day of each month of this twelve (12) month agreement
throughout the duration of our engagement,
1st Amt
due 10/15/07 & on the
15th day
of each month following. The monthly non-refundable retainer shall be reduced
after five (5) months or following the successful hiring of the permanent CEO / President, which
ever is longer. The reduced retainer shall become $7500 per month.




 









 








Compensation
Arrangements — Contingent Incremental Revenue Growth Incentive Fees



Because the Company has requested BVP to advise and develop marketing programs that will
implement dramatic revenue growth in the DTC sales channel, the Company will compensate BVP with
contingent incremental revenue growth incentive fees tied to the incremental revenue increase
over the current monthly run rate (defined as the monthly average of DTC revenue for the months
of April, May, June, July, August and September, 2007). For purposes of this engagement, BVP
expects that the Company shall pay BVP a fee monthly representing 10% of that incremental monthly
revenue for that reporting month. The reporting months shall be TBD. The Company shall pay BVP within 14 days following the end of each reporting month. The
payment of the incentive fee for the month ending September 30, 2008 shall be owed and paid by the
Company even though the Company’s engagement of BVP may have expired prior to month-end September
2008. BVP realizes that the Company may wish to discuss this crucial aspect of the Company’s
rapid growth and BVP compensation. The complete terms and conditions of the Growth Incentive Fee
shall be mutually determined and placed in a written document and signed by the Company and BVP
within 1 month of the beginning of this engagement.




Compensation Arrangements — Reimbursement of Expenses



It is contemplated that BVP shall receive reimbursement for all expenses incurred by BVP in
connection with any aspect of this engagement. As the Interim President is not a resident of the
Denver metro area, his expenses shall include certain costs of room and board for his planned
3-4 nights per week attending to his on-site duties on behalf of the
Company. All expenses shall
be reasonable and if it is the wish of the board, must have prior approval by a representative
of the Company. As for the Interim President’s costs for room and living expense, BVP is willing
to accept reimbursement on an actual cost basis or a not-to-exceed basis.




Compensation Arrangements — Issuance of Stock Warrants



In connection with BVP’s services, the Company shall furnish (or cause to be furnished) to BVP
or its assigns, a warrant to acquire up to 1,200,000 shares of the Company’s common stock (“BVP
Warrant”). The exercise price shall be equal to the warrant exercise price in the Unit offering
($.30) currently being conducted by Aspenwood Capital (last half calendar 2007). The life of the
warrant shall be 5 years. The warrant shall vest at a rate to be
determined. The Company shall be responsible for
registering the warrant and shall do so at the same time as registering the new shares being
issued for the Aspenwood Capital offering in Q3 and Q4 of calendar year 2007. It is contemplated
that the shares covered by the BVP Warrant be subject to vesting conditions based on mutually
agreed performance




 









 







milestones to be determined by the Company and BVP. In the event the Securities and
Exchange Commission makes a rule 415 comment, the warrants shall be immediately removed from
the resale registration statement and shall have “piggy back” registration rights. The
complete terms and conditions of the BVP Warrant shall be mutually determined and
placed in a written document and signed by the Company and BVP within 1 month of
the beginning of this engagement.




Confidentiality



In connection with BVP’s services, the Company will furnish (or cause to be furnished) to BVP such
information and data as is within the Company’s possession or control relating to the Company as
BVP reasonably deems necessary or reasonably requests in order to complete its assignments for the
Company. BVP will keep and maintain all non-public information which it receives or develops
concerning the Company confidential and will disclose such information only as is required in its
reasonable judgment by this assignment or is required by law. The Company recognizes and confirms
that in the performance of its services hereunder: (i) BVP may rely upon information provided by
the Company without independent verification, and (ii) BVP shall incur no liability as a  result
of such reliance. BVP will cause any third party that reviews the Company’s information to sign
and execute a Non-Disclosure Agreement before delivering such information to the third party as
circumstances may require.




Indemnification and Limitation of Liability



In consideration of BVP’s agreement to act on the Company’s behalf in connection with this
engagement, the Company agrees to indemnify and hold harmless BVP and its officers, directors,
agents and employees against any loss, claim, damage, liability, or expense (including
reasonable counsel fees and expenses) arising out of or to which BVP may become subject in
connection with this engagement. The Company agrees to promptly reimburse BVP for any legal or
other expenses as incurred in connection with investigation or defending any such loss, claim,
damage or liability (or action in respect thereof). In no event shall BVP be liable for acting
in accordance with instructions from the Company or any entity
authorized to act on its behalf.



BVP agrees to indemnify and hold harmless the Company and its officers, directors, agents and
employees against any loss, claim, damage, liability, or expense (including reasonable counsel
fees and expenses) arising out of or to which the Company may become subject, in connection
with BVP’s engagement. BVP agrees to promptly reimburse the Company for any legal or other
expenses as incurred in connection with investigation of or defending against any such loss,
claim damage or liability (or action in respect thereof).




 









 








Effectiveness and Termination



As recited above, the effective date of this engagement shall be September 10, 2007. This
engagement will terminate automatically on September 9, 2008, unless otherwise extended by mutual
written agreement. In the event of such automatic termination, BVP shall be entitled to all
compensation due through the date of termination, including base and contingent fees as specified
earlier in this letter, as well as all unpaid out-of pocket expenses. The Company shall pay the
contingent incremental revenue growth incentive fees by the 14th day of the subsequent
month through the reporting month ending September 2008.



The
Company or BVP may terminate this agreement after 60 days for cause by giving written notice
to the other party. In the event of termination by either party, the BVP Warrant shall vest for a
period of 6 months or actual months worked, whichever is longer.




Miscellaneous



This agreement may not be amended or modified except in writing and shall be governed and
construed in accordance with the laws of the State of Colorado. The indemnity and reimbursement
provisions contained herein shall remain in full force and effect in the event of termination.
The invalidity, legality or enforceability of any provision of this agreement shall in no way
affect the validity, legality or enforceability of any other provision. If any provision is held
to be unenforceable as a matter of law, the other provisions shall not be affected thereby and
shall remain in full force and effect.



Please confirm that the foregoing proposal is in accordance with our understanding and is
acceptable to you by signing and returning to me the enclosed duplicate original engagement
letter. We look forward to a successful relationship, culminating in the attainment of these
mutually desirable objectives on behalf of the Company.




	 	 	 	 	 
	 
	 	 	 	 
	Sincerely,

	 	 
	 	Agreed to and accepted:
	 
	 	 	 	 
	BOLDER VENTURE PARTNERS

	 	 	 	LIFEVANTAGE CORPORATION
	 
	 	 	 	 
	Daryl Yurek, Managing Director

	 	 	 	James D. Crapo, Chairman
	 
	 	 	 	 
	/s/  Daryl Yurek      Date Sept 28/07

	 	 	 	/s/  James D. Crapo      Date 9/28/07
	 

	 	 	 	      by Jack R. Thompson