Update: According to the June 30, 2011 LifeVantage 10-K filing, McCord now gets a majority of his money not from salary or by stock performance (since that has been poor), but based on sales of the product:
"Monthly Compensation. Dr. McCord’s monthly compensation for his services under his employment agreement is $10,000 per month. In addition, Dr. McCord is eligible to receive a monthly commission equal to the product of fifty cents multiplied by the total net bottles sales of Protandim® (or substantially equivalent new products) during the preceding month. Dr. McCord was not awarded any additional stock options in fiscal year 2011 in connection with his hire."
He gets 50 cents for every bottle sold. According to the latest quarterly numbers, LifeVantage's revenue (product sold) is $10 Million dollars. At $50 a bottle he gets roughly 1 percent of that. Quick math shows that to be $100,000 for the quarter - or $400,000 for the year. For a guy that perpetuated the lie that he invented Protandim for years, a wise consumer should be very skeptical of anything he says - Joe McCord's compensation is directly tied to his role of marketing the product.
Now back to the original article about the millions he has in stock options.
A commenter here named Fred tried to make a claim that there was no way that chance that Dr. Joe McCord "sold his soul for the almighty dollar." The crux of his argument was this page on Forbes that shows Dr. Joe McCord's compensation A review of this information shows that Dr. Joe McCord had earned a total of $115,766 in the four years from 2007-2010. All but $12,000 of that was in the form of stock options. The argument was made that this compensation is modest especially over a four year period.
It would be a fair argument if it was the full story.
This is a case where a LifeVantage supporter is only giving a small part of the story. The Forbes data doesn't tell the complete story of Dr. Joe McCord's financial interest in LifeVantage. It is much more than it appears here.
The most important thing to note is that McCord's history with LifeVantage goes back to when the company was still called Lifeline. According to SEC filings on 10/26/2004 he declared he was a 10% owner with 1,928,160 shares of stock. He later amended this 1,606,800 shares. At the time he declared it 10/26/2004, LifeVantage was trading around $3.60 a share. That amended amount is worth $5.75 million dollars. However, the interesting thing is that it using today stock price and market capitalization, it appears that LifeVantage at the time had a value of around $285 million dollars. A 10% owner would therefore have a vested interest worth $28.5 Million.
Either of those numbers may be enough for for Joe McCord to let LifeVantage lie about the creation of Protandim. That's quite a good sum for using McCord as marketing as the company admits.
However, there's a lot more McCord's compensation. Here are the SEC filings of stock options that Joe McCord have been granted from 2007-2011
1/16/2007 - 20,408 shares - $0.49 strike price
1/18/2007 - 240,000 shares - $0.49 strike price
11/13/2007 - 120,000 shares - $0.21 strike price
1/7/2009 - 120,000 shares - $0.21 strike price
11/30/2009 - 120,000 shares - $0.25 strike price
1/20/2011 - 120,000 shares - $0.80 strike price
5/25/2011 - 374,625 shares - $0.20 strike price
The last of these is probably the most interesting. On May 25, 2011, LifeVantage was trading at $1.66, so being issued shares at a $0.20 equates to a instant profit of $1.46 a share multiplied by 374,625 shares. This was instantly worth seeming worth $546,952.50.
With LifeVantage's stock price at $1.39 as of this writing, McCord's stock options are worth $1.1 Million (this is in addition to the other stock he was given that was discussed above). If he can manipulate the stock to $2.50 those options become worth $2.4 million.
As for McCord's financial motivation, there can be little doubt that he's paid well for being a spokesman.
It is up to the reader to decide how much integrity millions of dollars can buy. I presume it varies from person to person.
Originally posted 2011-08-13 23:07:18.This post involves:
Next: LifeVantage Protandim Open Discussion