CONFIDENTIAL SEVERANCE
AGREEMENT AND GENERAL
RELEASE OF CLAIMS
THIS SEVERANCE
AGREEMENT AND GENERAL RELEASE OF CLAIMS (the “
Agreement ”) dated as of December 14, 2006 is
entered into by and between Stephen K. Onody, an individual
(“ Executive ”), and Lifevantage
Corporation (f/k/a Lifeline Therapeutics, Inc.), a Colorado
corporation (“ Lifevantage ”).
WHEREAS ,
Lifevantage and Executive entered into an Employment Agreement
effective as of November 28, 2005 (the “
Employment Agreement ”);
WHEREAS ,
Lifevantage and the Executive herein desire to terminate
Executive’s employment and amend the terms of the Employment
Agreement to the extent, and only to the extent, provided
herein;
NOW,
THEREFORE , in consideration of the mutual promises and
covenants set forth below, the parties, intending to be legally
bound, agree as follows:
1. Termination of Employment .
Executive’s
employment with Lifevantage, including any and all director and
officer positions with Lifevantage or any partially-owned or
wholly-owned subsidiary of Lifevantage, shall terminate effective
December 15, 2006 (“ Termination Date
”).
As full,
sufficient and complete consideration for Executive’s
promises and releases contained herein, Lifevantage agrees to
provide Executive the following:
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2.1
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Cash Payment . Lifevantage shall provide cash
payment to Executive in the following amounts:
(a) Executive’s accrued unpaid Base Salary to the
Termination Date and any bonus earned but not paid as of the
Termination Date; and (b) an amount equal to three
(3) months of Executive’s Salary, at the rate in effect
as of the Termination Date, not including any bonus, benefits nor
other payments, from which the normal payroll and tax deductions
will be made (the “ Cash Severance ”).
The Cash Severance shall be paid as follows: (i) subparagraph
(a) shall be paid on the Termination Date and
(ii) subparagraph (b) shall be paid in equal installments
in accordance with Lifevantage’s normal payroll cycle during
the three months following the Termination Date.
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2.2
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Stock Options
. As of the Termination
Date, stock options for a total of three hundred thirty three
thousand three hundred and thirty three (333,333) shares of
Lifevantage’s common stock previously have vested pursuant to
the Employment Agreement and the Option, as defined in the
Employment Agreement, and
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Executive’s rights to any additional
vesting under the Option shall terminate. Except as provided
herein, the terms and conditions of such Option shall continue to
be governed and controlled pursuant to the corresponding option
agreement.
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2.3
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Additional Benefits
. Lifevantage shall
provide Executive with continued long term care insurance and
medical insurance, including disability, plans or arrangements for
a period of 60 days following the Termination Date (the
“ Benefit Period ”). In addition,
Lifevantage shall provide Executive with his personal laptop
computer and cash in lieu of any accrued vacation on the
Termination Date to be paid in the January 1, 2007 payroll
payment.
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2.4
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COBRA Coverage
. Executive shall be
eligible for COBRA coverage on the first date following the Benefit
Period payable 100% by Executive.
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2.5
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Consulting Arrangement.
In consideration for the
foregoing benefits in this Section 2, Executive agrees to
provide consulting services to the Board of Directors of
Lifevantage in connection with the transition after
Executive’s employment during the three-months following the
Termination Date, not to exceed 15 hours per week of commitment by
Executive.
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For purposes of
this Agreement, the consideration set forth in this paragraph 2
shall collectively be referred to as the “
Severance .”
3. Additional Payment or Actions .
Except as provided
under paragraph 2 of this Agreement, Executive agrees that no
additional payments or actions of any kind are due under this
Agreement or the Employment Agreement, except that reimbursable
expenses incurred by Executive prior to the Termination Date shall
be paid in accordance with Lifevantage’s established
practices
4. Acknowledgment of Additional Consideration; No
Admission .
Executive
acknowledges that the payment and other undertakings described
above in Section 2, will fully discharge and satisfy all of
Lifevantage’s obligations for monies and any other
consideration due to Executive by reason of his employment,
including, but not limited to, all Lifevantage’s obligations
under the Employment Agreement, and that these undertakings will
also provide him with additional monies and undertakings that are
not otherwise due to Executive now, nor in the future, and
that constitute valuable consideration for Executive’s
release of claims and other promises herein. This Agreement is
not an admission by either Lifevantage or Executive of any
wrongdoing or liability.
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In exchange for
Lifevantage’s payments and other undertakings as described
herein, Executive, for himself and his heirs, legal
representatives, successors and assigns, does hereby completely
release and forever discharge Lifevantage, its parent, subsidiaries
and affiliated companies, and their respective shareholders,
officers, directors, representatives, employees, former employees,
agents, attorneys, successors and assigns (herein collectively the
“ Releasees ”) from all claims, rights, demands,
actions, obligations and causes of action of any and every kind,
nature and character, known or unknown, that Executive may now have
or has ever had or will have against them based on any act or
omission that occurred through the date this Agreement is signed,
including without limitation : (a) any and all claims of
“wrongful discharge,” breach of express or implied
contract, breach of the implied covenant of good faith and fair
dealing, wrong
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