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EXHIBIT 10.8
[LETTERHEAD OF ROSENBLUM PARTNERS, LLC]
August 7, 2000
DELIVERED VIA FACSIMILE
Mr. John Gorst, CEO
Xcel Management, Inc.
1101 Broadway Plaza
Tacoma, WA 98402
Re: Engagement Letter and Fee Agreement-Xcel Management, Inc.
Dear Mr. Gorst:
This Engagement Letter and Fee Agreement ("Agreement") will confirm that
Xcel Management, Inc. an existing Utah Corporation (collectively "XCEL
MANAGEMENT, INC." or "you"), has engaged Rosenblum Partners, LLC ("Rosenblum" or
"we") and that Rosenblum has agreed to perform financial advisory and
intermediaries services on behalf of XCEL MANAGEMENT, INC. with respect to
arranging a private placement offering and/or financing for XCEL MANAGEMENT,
INC. as further detailed herein.
1. Scope of Services. On a non-exclusive basis, Rosenblum will act as
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financial intermediary in structuring the private placement of common
and/or preferred equity in connection therewith; raising approximately
$1 to $2 million United States Dollars as may be required by XCEL
MANAGEMENT, INC., through the sale of new equity for XCEL MANAGEMENT,
INC. (the "subject financing"). The essence of Rosenblum's services
will be to act as an intermediary in providing financial advisory
services to XCEL MANAGEMENT, INC. regarding the subject financing, and
in making introductions and referrals to Rosenblum Financing Sources
identified by Rosenblum in writing and approved by XCEL MANAGEMENT,
INC. in writing. For purposes of this Agreement, "Rosenblum Financing
Source" shall include any entity or party that is identified by
Rosenblum to XCEL MANAGEMENT, INC. in writing and approved by XCEL
MANAGEMENT, INC. in writing as a potential investor and that makes an
investment in XCEL MANAGEMENT, INC. as a result of Rosenblum's
efforts. Rosenblum Financing Sources shall not include any party that
XCEL MANAGEMENT, INC. identifies in writing to Rosenblum prior to or
following execution of this Agreement as a party that it has had or
intends to have contact with regarding making an investment in XCEL
MANAGEMENT, INC. and any other party that is not identified by
Rosenblum to XCEL MANAGEMENT, INC. in writing and approved by XCEL
MANAGEMENT, INC. in writing as a potential investor.
Neither Rosenblum, nor are any of its principals, licensed as
registered investment advisors, securities brokers-dealers, attorneys
or accountants, and none of the
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services provided by Rosenblum or its principals are intended to be
construed as offering or selling XCEL MANAGEMENT, INC. securities, or
giving investment, legal and/or tax advice.
Other than as expressly provided for herein, Rosenblum makes no
guarantee or warranty to deliver or produce any results from its
efforts, or that its services will in fact result in a third party or
parties actually providing funding or making an investment in XCEL
MANAGEMENT, INC.. Also, XCEL MANAGEMENT, INC. is under no obligation
to enter into an agreement with any entity, with any investment banker
or securities broker-dealer, or accept or receive funding from any
Rosenblum Financing Source, or agree to any terms or conditions for
proposed financing other than as XCEL MANAGEMENT, INC.
2. Rosenblum Compensation.
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(a.) Upon the closing of each funding from a Rosenblum Financing
Source, XCEL MANAGEMENT, INC. shall pay Rosenblum a cash sum
equal to 7% of the gross amount to be disbursed at each said
Closing. XCEL MANAGEMENT, INC. hereby irrevocably authorizes and
instructs the Rosenblum Financing Source to pay the cash sum
directly to Rosenblum, out of the closing proceeds, at the time
of each funding closing.
(b.) All expenses incurred by Rosenblum in excess of $500, including
the printing of documents etc., shall be approved in advance by
XCEL MANAGEMENT, INC., for which XCEL MANAGEMENT, INC. shall
reimburse Rosenblum.
3. Due Diligence. We shall be conducting a due diligence background
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investigation of XCEL MANAGEMENT, INC., including asking you to
respond in writing to a Due Diligence Questionnaire. XCEL MANAGEMENT,
INC. hereby agrees to cooperate in responding to this Due Diligence
Questionnaire and to otherwise make full, fair and truthful disclosure
to Rosenblum regarding the business, legal, financial and tax
condition of XCEL MANAGEMENT, INC.. Further, XCEL MANAGEMENT, INC.
hereby represent and warrants to Rosenblum that any and all of the
information contained in the XCEL MANAGEMENT, INC. financial
statements and other documents provided by XCEL MANAGEMENT, INC. to
Rosenblum with respect to the subject financing are materially
accurate, do not contain any misrepresentations of fact, and do not
omit to state any information so as to make such documents misleading.
XCEL MANAGEMENT, INC. also agrees to supplement and periodically
update all such information so as to make the information provided by
XCEL MANAGEMENT, INC. to Rosenblum materially accurate.
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4. Indemnification.
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(a.) XCEL MANAGEMENT, INC. shall indemnify and hold harmless Rosenblum
from and against all claims, damages, losses, and liabilities
(including, without limitation, reasonable attorneys' fees and
expenses) arising out of or based upon any misstatement or
omission or alleged misstatement or omission, in an offering
memorandum or any other materials or information supplied or
approved by XCEL MANAGEMENT, INC. which are disseminated by
Rosenblum to Rosenblum Financing Sources, except XCEL MANAGEMENT,
INC. shall not be liable for any claim of damage, loss or
liability which is finally determined to have resulted from
Rosenblum's fraud or gross negligence.
(b.) Rosenblum shall indemnify and hold harmless XCEL MANAGEMENT,
INC. from and against all claims, damages, losses, liabilities
(including, without limitation, reasonable attorneys' fees and
expenses) arising out of or based upon any misstatement or
omission, or alleged misstatement or omission, by Rosenblum, in
any materials or information prepared by Rosenblum which were not
supplied or approved by XCEL MANAGEMENT, INC. and were
disseminated to third parties, including Rosenblum Financing
Sources.
5. Term and Termination. The term of this Agreement is for 60 days,
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unless terminated earlier by XCEL MANAGEMENT, INC. on thirty (30) days
notice to Rosenblum. Notwithstanding the foregoing, if a Closing
occurs with a Rosenblum Financing Source at any time within 365 days
after such termination, the compensation provided for in items (b) and
(c) of paragraph 2 shall be immediately due and payable to Rosenblum
as provided for therein.
6. Notice. Any notices to be given hereunder by each party to the other
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may be effected by personal delivery in writing or by mail, registered
or certified, postage prepaid with return receipt requested to the
addresses set forth below. Notices delivered personally shall be
deemed communicated as of actual receipt; mailed notices shall be
deemed communicated as of two (2) days after mailing.
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As to XCEL MANAGEMENT, INC.: As to Rosenblum:
Mr. John Gorst Mr. Charles L. Rosenblum, CEO
Xcel Management, Inc. Rosenblum Partners, LLC
1101 Broadway plaza 18952 Mac Arthur Blvd., Suite 350
Tacoma, WA 98402 Irvine, CA 92612
7. Applicable Law. This Agreement shall be construed under the laws of
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the State of California. Venue shall be Orange County, California
8. Attorneys' Fees. If any action at law, or in equity, is necessary to
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enforce or interpret the terms of this Agreement, the prevailing party
shall be entitled to reasonable attorneys' fees and costs, in addition
to any other relief to which it may be entitled.
9. Entire Agreement. This Agreement supersedes any and all other
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agreements, either oral or in writing, between the parties hereto with
respect to the engagement of Rosenblum and contains all of the
covenants and agreements between the parties with respect to such
engagement in any manner whatsoever. This Agreement may not be altered
or modified except by an agreement in writing, signed by both parties.
If any provision of this Agreement is held by a court of competent
jurisdiction to be invalid, void, or unenforceable, the remaining
provisions shall nevertheless continue in full force without being
impaired or invalidated in any way.
If the terms and conditions of this Agreement are acceptable to you, then
please execute this Agreement where indicated below and return an
originally executed Agreement to me.
Very truly yours,
Rosenblum Partners, LLC
/s/ CHARLES ROSENBLUM
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By: Charles L Rosenblum
CEO/Chairman
ACCEPTANCE: The undersigned, as the CEO acting on behalf of Xcel
Management, Inc., hereby acknowledges that he has read and understands the
terms and conditions of the foregoing Agreement with Rosenblum Partners,
LLC, and that Xcel Management, Inc., hereby agree to be bound by and
perform in accordance with such terms and conditions.
Xcel Management, Inc.
By: Dated:
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Mr. John Gorst, CEO
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