Exhibit 10.32





 


RETAINER AGREEMENT


 


XELR8
Holdings, Inc. (“the
Client”) engages Wolfe Axelrod Weinberger Associates LLC (“WAW”), as its
financial public relations firm for a program of financial communications and
investor relations.


 


Client
is engaging WAW to perform financial public relations services.


 


This
agreement is intended to memorialize the duties and responsibilities of the
parties with respect to such services and Information (as defined below)
concerning the Client as previously discussed.


 


The
terms of the engagement are as follows:


 


1.             Compensation.


 


(a)           Base Retainer Fee:  At the rate of $8,000 per month for the
initial year of the engagement period which will begin on January 25,
2008.  If a positive net income is stated
on the quarterly report of Client filed with the Securities and Exchange
Commission (Form 10-Q) for any quarter during the term of this Agreement,
then, beginning with the month following such quarter, the rate of the monthly
base retainer fee shall increase to $12,000.


 


(b)           Additional Compensation—Options to
Purchase Client Stock.  In addition to
the monthly retainer, Client agrees to make a one-time grant to WAW of 300,000
options to purchase fully paid and non-assessable shares of common stock of
Client exercisable at the price of $1.50 (subject to adjustment as provided
below).


 


(i)                                     The options
shall vest ratably over the initial year of the Agreement.


 


(ii)                                  Each option
will have a five-year duration commencing with the vesting date.


 


(iii)                               Each
holder of an option and each holder of a share underlying an option shall have
customary piggyback registration rights with respect to the shares underlying
the options held by such person or entity, subject to customary market and
underwriter’s carveouts.  The Client
shall bear all expenses relating to such registration, including SEC, and other
filing fees, auditors fees, attorneys fees and other customary expenses (other
than underwriters’ compensation for an underwritten offering and brokerage fees
for sales through market makers and broker dealers in a non-underwritten
offering).  The registration rights shall
continue until the earlier of such time as (i) the underlying shares are
registered under the Securities Act of 1933, as amended (The “Securities Act”)
or such time as they may be sold pursuant to Rule 144(K) under the
Securities Act.  The shares underlying
the options shall be listed for trading at the issuer’s expense on each
exchange and market upon which the class of securities underlying the options
are traded or for which a market is made. 
At its discretion, WAW may choose to exchange its options for shares
under a cashless exercise transaction. 
The option set forth 


 


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herein
shall be exercised through delivery of an executed subscription agreement in
substantially the form attached hereto as Annex B.


 


(iv)                              The
options may not be transferred without the prior written consent of the Client,
which shall not be unreasonably withheld, delayed or conditioned.  However, the options may be transferred in
whole or in part to one or more employees or members of WAW, subject to
compliance with applicable securities laws.


 


(v)                                 Until
exercise of the options and tender of the exercise price, the exercising holder
shall not be deemed to be a shareholder for all purposes.


 


(vi)                              Appropriate
adjustments in the number of options and option exercise price shall be made
for all recapitalizations, stock splits, stock dividends and other similar or
dissimilar changes in the capital structure of the Client.  Upon the request of WAW, the Client shall
provide to WAW a certificate issued by its chief financial officer setting
forth any adjustments in the number of options or option exercise price
required by this subparagraph.


 


(c)           Additional Compensation—First
Profitable Quarter Bonus.  With respect
to the first quarter, if any, during the term of this Agreement in which a
positive net income is stated on the quarterly report of Client filed with the
Securities and Exchange Commission (Form 10-Q), WAW shall receive a
one-time bonus in the amount of $12,000.  This bonus compensation, if
earned, shall be payable in one lump sum within 60 days of the end of the
relevant quarter.


 


(d)           Additional Compensation—Closing Price
Goal Bonus.  If, prior to January 15,
2009, the common stock of the Client shall have a closing sales price of
greater than $2.50 per share for 20 or more consecutive trading days, then WAW
shall be entitled to a one-time additional bonus in the amount of $75,000,
payable in one lump sum within 60 days of the date on which the condition is
satisfied.


 


2.             Other Fee Matters.


 


Should the Client
require additional financing, WAW has relationships with merchant and
investment bankers, private placement professionals and other intermediaries
available to the Client for the solicitation of funds.  To the extent that Client specifically
requests WAW to assist it in procuring such additional financing, then the
terms of such retention shall be negotiated at such time.  WAW acknowledges that Client currently has,
and from time-to-time may continue to enter into financing arrangements with
third parties without any involvement by WAW.


 


3.             WAW Duties.


 


In its role as
financial public relations advisor to the Client WAW shall assist the Client
to:


 


(a)                                  Analyze the Client’s business and
industry, following which a comprehensive fact sheet summarizing the Client’s
corporate and financial profile will be created/revised for distribution to investment
professionals and the press.  Client
shall be responsible for the accuracy of the statement therein and shall hold
WAW harmless from and against any claims relating thereto. WAW shall advise and
assist the Client in distributing the profile utilizing WAW’s relationships, including
the Dow Jones wire service and ticker.


 


(b)                                 Contact
appropriate investment newsletters and encourage editors to research  Client as a possible investment opportunity.


 


(c)                                  Work
collaboratively with any other entity used by the client to develop a strategy
to promote Client to the financial and trade press, key decision leaders, and
industry-relevant meetings in the security industries.


 


 


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(d)                                 Work
collaboratively with any other entity, whose primary responsibility will be
public relations, branding, marketing materials, placement in trade
publications, and public speaking engagements at trade events.


 


(e)                                  Counsel
the Client in its overall activities with the financial community through
consultation with its management.


 


(f)                                    Write
and/or edit, and make suggestions concerning all press releases, quarterly
reports to shareholders, annual shareholder letter and other written
communications as well as disseminate such information through appropriate
channels.


 


(g)                                 Prepare/revise,
along with management, presentation materials for meetings with the investment
community.


 


(h)                                 Establish
a mailing list of financial contacts for the benefit of Client, and maintain
and update the list.  This mailing list
shall be utilized by Client at any time during the term of WAW’s engagement but
shall remain the sole property of WAW. 
However, any shareholder or other names given to WAW by Client shall
remain the sole property of the Client. 
All names acquired by WAW in the course of its activities for the Client
will be supplied to the Client on written request made during the engagement
period.  WAW represents that any names or
contact information provided to WAW by it or its agents or representatives
shall not include any individuals that have requested not to be contacted,
including, without limitation individuals that have been listed on any state or
federal so called “do not call list”.


 


(i)                                     WAW
will endeavor to arrange meetings with qualified brokers, money managers,
institutional investors, analysts, portfolio managers, etc. in regional
financial centers such as NYC, Boston, Los Angeles, San Francisco, Chicago,
Minneapolis and Philadelphia. In addition, WAW will use its best efforts to
arrange to have Client present at appropriate investor conferences.


 


4.             Representations and Warranties of
WAW.


 


In
performing its duties hereunder, WAW represents that all times it will be in
compliance with applicable laws, rules and regulations, including those of
the Securities Act and the rules and regulations promulgated thereunder.


 


5.             Term, Renewal and Early Termination
of Engagement.


 


Term. This Agreement
shall commence on January 28, 2008.


 


The engagement of WAW to
perform services hereunder shall continue for a period of one year starting
with the commencement date and ending on the last day of the 12th
month following such date.  The
engagement will be renewed every 12 months for successive additional twelve
(12) month periods (individually, each being a “Renewal Period”) under the
terms and conditions of this Agreement unless the Client provides WAW with
prior written notice of its intention to terminate the engagement at least 30
days prior to the expiration of the then current term.  For each renewal term, the parties shall
negotiate in good faith concerning the appropriate annual base retainer fee.
Until they reach agreement, the fee due for the prior month shall continue as
the monthly fee due to WAW for its services.


 


6.             Early Termination of Engagement
Upon Notice.


 


The Client or WAW will
have the option of canceling the Agreement under the following conditions and
resolutions:


 


(i)                                     WAW may
resign as an advisor to the Client upon notice to Client at any time when
securities of the Client are suspended from trading by order of the Securities
and Exchange Commission, by any exchange or market upon which its securities
are listed or are delisted by such exchange or market, or if the Client fails
to provide to WAW accurate and timely information  necessary for WAW to perform its duties
hereunder, or if a material breach of this Agreement by Client shall not be
timely cured by the Client within at least ten (10) after receipt by
Client of written notice 


 


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of
such breach.  A resignation by WAW under
this paragraph shall terminate the obligation of Client to pay base retainer
fees to WAW from and after the effective date of the resignation, but shall not
affect the options granted to WAW or the other rights of WAW hereunder.  However, in the event that WAW terminates
this Agreement at any time for any reason other than those specified above in
this paragraph or paragraph (ii) below, then only the options that have
vested as of such date shall be exercisable, but only for a ninety-day period
from such termination by WAW.


 


(ii)                                  Either party
at any time may terminate WAW’s engagement hereunder (a) upon actions by
the other party that are fraudulent in nature or (b) for “cause”.  For the purposes of this Agreement “cause”
shall be deemed to be a breach of any of the terms of this Agreement or of any
representation and warranty contained herein and the failure to cure such a
breach after notice is given, to the extent it is curable.  Upon any such termination by Client the
obligation of Client to pay base retainer fees and additional compensation
under Sections 1(c) and (d) to WAW shall terminate immediately. In
the event such termination is by Client pursuant to this paragraph, then only
options that have vested as of such date shall be exercisable, but only for a
ninety-day period from such date of termination.


 


(iii)                               Return of
Property Upon Termination of Engagement. 
Upon termination of WAW’s services under this Agreement, WAW shall
return to the Client all tangible personal property owned by the Client and in
WAW’s possession or control (other than such Information and property that WAW
deems in good faith to be necessary to retain for potential or actual
litigation or purposes of governmental investigations), conditioned upon receipt
of full payment by the Client of all amounts due and owing under this Retainer
Agreement and Client’s performance of its duties and obligations hereunder.


 


(iv)                              Survival.  The provisions of Sections 1, 5, 7, 8, 10
and11 and Annex A shall survive the expiration or termination of this Agreement
or of WAW’s engagement to provide services hereunder.


 


7.             Out-of-Pocket Expenses.


 


Client shall reimburse
WAW for any and all expenses incurred and expenditures made on behalf of the
Client during the Term of this engagement. 
All expenses shall be submitted to the Client with appropriate
backup.  No mark up will be applied by
WAW to any expenses incurred by WAW for the Client.  These expenses include, but are not limited
to, the following:


 


Telephone, photocopying, postage for releases and
postage for inquiries, messenger service, information retrieval service,
monitoring advisory service, all production costs for printing releases
including the paper, envelopes, folding, insertion, and delivery to the post office.


 


WAW may incur expenses
in accordance with a quarterly budget that is approved by Client, or on an
ad-hoc basis with the written approval of Client.


 


8.             Termination Expenses.


 


All unpaid bills must be
paid in full at the time of resignation or termination of WAW’s duties as an
advisor.  Resignation or termination
shall not relieve the Client of its obligation to pay all amounts accrued prior
to such termination and shall not limit WAW or Client, as the case may be, from
pursuing other remedies which may be available to it.


 


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9.             Approval.


 


All
stockholder communications, press releases and other materials prepared and
disseminated on the Client’s behalf by WAW will be subject to the Client’s
prior approval as to form and content. 
Client shall be solely responsible for the content, timeliness and
accuracy of the information.


 


10.           Confidentiality: Use of Information.


 


The Client will furnish
(or will use reasonable efforts to cause its counsel and other third parties to
furnish) to WAW accurate and complete information as may be necessary or
appropriate for purposes of performing services under this Agreement (the “Information”).  Client recognizes and confirms that WAW
assumes no responsibility for the accuracy and completeness of the Information
(including information available from generally recognized public sources) and
will be using and relying upon the Information (and information available from
generally recognized public sources) without assuming responsibility for
independent verification or independent evaluation of any of the assets or
liabilities (contingent or otherwise), business, prospects or other Information
of or relating to the Client or any third party.


 


WAW agrees to preserve
the confidentiality of any information disclosed by the Client to WAW, except
for such disclosure as may be required by court order, subpoena or other
judicial process.


 


If WAW or any of its
representatives are requested or required (by oral questions, interrogatories,
requests for information or documents in legal proceedings, subpoena, civil
investigative demand or other similar process) to disclose any of the
Information or other materials in its possession, it shall provide the Client
with notice of any such request or requirement so that the Client may seek a
protective order, confidential treatment or other appropriate remedy and/or
waive compliance with the provisions of this letter agreement.  If, in the absence of a protective order or
other remedy or the receipt of a waiver from the Client, WAW or any of its
representatives may nonetheless, upon the advice of its outside counsel,
legally compelled to disclose Information or materials to any tribunal,
commission, board, exchange, market or governmental agency or else stand liable
for contempt or suffer other censure or financial penalty, WAW or its
representative may, without liability hereunder, disclose to such requester the
Information or materials which such counsel advises it that WAW is legally
required to be disclosed.


 


11.           Indemnification.


 


Client and WAW each
hereby agree to the indemnification provisions set forth in Annex A which is
attached and incorporated by reference in its entirety to this Agreement.


 


12.           Independent Contractor.


 


The Client acknowledges
that in performing its services, WAW is acting as an independent contractor and
not as a fiduciary, agent or otherwise, with duties owing solely to the
Client.  Client acknowledges that WAW has
and will have other clients that may compete with or be adverse to Client in
litigation or other matters.  Client
consent thereto and agrees that WAW may represent or continue to serve such
entities during the term of this engagement. 
WAW has no authority to bind the Client or to make representations or
warranties on behalf of the Client.


 


13.           Legal Recourse.


 


Any dispute(s) or
claim(s) with respect to this Agreement or the performance of any
obligations there under, may be brought in a court of competent jurisdiction in
the State of New York.  The Client and WAW,
each, irrevocably submits to the jurisdiction of any court of the State of New
York located in the City and County of New York and to the jurisdiction of the
United States District Court for the Southern District of New York for the
purpose of any suit, action or other proceeding arising out of or relating to
this Agreement, the options, the securities mentioned herein or WAW’s
engagement hereunder.  Each of the
parties, recognizing the costs and uncertainty of trial by jury hereby waives
any right it may have to a trial by jury in respect of any claim brought by or
on behalf of either party based upon, arising out of or in connection with this
Agreement, the options, the securities mentioned herein or WAW’s engagement
hereunder.


 


 


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14.
Miscellaneous.


 


This Agreement and the
Annexes hereto set forth the entire understanding of the parties concerning its
subject.  It may not be modified,
terminated or superseded and no provision may be waived orally.  Amendments, termination, superseding
agreements and waivers must be in a writing specifically referencing this
Agreement if they are to be effective.


 


This Agreement will be
governed by and construed in accordance with the laws of the State of New York
applicable to agreements made and to be fully performed therein.  Any choice of law rules that might apply
any other laws shall not apply.


 


All rights, liabilities
and obligations hereunder will be binding upon and inure to the benefit of
Client and WAW, each Indemnified Party (as defined in Annex A) and their
respective successors and permitted assigns.


 


This is a personal
services agreement and cannot be assigned or delegated, by either party,
without the prior written consent of both parties, which consent shall not be
unreasonably withheld, delayed or conditioned. 
Unauthorized assignments shall be null and void.


 


	
  WOLFE AXELROD WEINBERGER ASSOC. LLC.

  	
  XELR8 HOLDINGS, INC.

  
	
   

  	
   

  
	
   /s/
  Stephen D. Axelrod

  	
   

  	
  /s/ John D. Pougnet

  	
   

  
	
  Stephen
  D. Axelrod, CFA 

  	
  John
  D. Pougnet, CPA 

  
	
  Managing
  Member

  	
  Chief
  Executive Officer

  
	
   

  	
   

  
	
  Date:       January 25, 2008                

  	
  Date: January 25, 2008

  
				



 


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ANNEX A

INDEMNIFICATION


 


This Annex is an integral part of an engagement
Agreement with

WOLFE AXELROD WEINBERGER ASSOC. LLC (“WAW”).


 


Each of the Client and WAW (hereinafter,
each an “Indemnifying Party”) hereby agree to indemnify and hold harmless the
other and its affiliates and respective current and former members, directors,
officers, employees, agents, principal shareholders and controlling persons
(each such person, including WAW and Client, an “Indemnified Party”) to the
extent fully permitted by law from and against any losses, claims, damages and
liabilities, joint or several (collectively, the “Damages”), to which such
Indemnified Party may become subject in connection with or otherwise relating
to or arising from the Agreement or the performance by WAW of services
thereunder, and will reimburse each Indemnified Party for all fees and expenses
(including the fees and expenses of counsel) (collectively, “Expenses”) as
incurred in connection with investigating, preparing, pursuing or defending any
threatened or pending claim, action, proceeding or investigation (collectively,
the “Proceedings”) arising therefrom, whether or not such Indemnified Party is
a formal party to such Proceeding. 
However, no such Indemnifying Party shall be liable to any such
Indemnified Party to the extent that any Damages are found in a final
non-appealable judgment by a court of competent jurisdiction to have resulted
from the gross negligence or willful misconduct of the Indemnified Party
seeking indemnification hereunder.


 


If for any reason other than in accordance
with the Agreement, the foregoing indemnity is unavailable to an Indemnified
Party or insufficient to hold an Indemnified Party harmless, then the
Indemnifying Party will contribute to the amount paid or payable by an
Indemnified Party as a result of such Damages (including all Expenses incurred)
in such proportion as is appropriate to reflect the relative benefits to such
Indemnifying Party on the one hand, and Indemnified Party on the other hand, in
connection with the matters covered by the Agreement or, if the foregoing
allocation is not permitted by applicable law, not only such relative benefits
but also the relative faults of such parties as well as any relevant equitable
considerations.


 


Neither Client nor WAW shall enter into
any waiver, release or settlement of any Proceeding (whether or not any other
Indemnified Party is a formal party to such Proceeding) in respect of which
indemnification may be sought hereunder without the prior written consent of
the other (which consent will not be unreasonably withheld), unless such
waiver, release or settlement (i) includes an unconditional release of
each Indemnified Party from all liability arising out of such Proceeding and (ii) does
not contain any factual or legal admission by or with respect to any
Indemnified Party or any adverse statement with respect to the character,
professionalism, expertise or reputation of any Indemnified Party or any action
or inaction of any Indemnified Party.


 


The indemnity, reimbursement and
contribution obligations hereunder will be in addition to any liability which
either the Client or WAW may have at common law or otherwise to any Indemnified
Party and will be binding upon and inure to the benefit of any successors,
assigns, heirs and personal representatives of the Client, WAW or an
Indemnified Party.  The provisions of
this Annex will survive the modification or termination of the Agreement and
may not be modified, waived, amended or superseded unless such act is
memorialized in a writing signed by the Client and by WAW and each affected
Indemnified Party.  Oral waivers,
amendments, termination or superseding agreements shall be of no effect.


 


 


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ANNEX B

SUBSCRIPTION FORM


 


This Annex is an integral part of an engagement
Agreement with

WOLFE AXELROD WEINBERGER ASSOC. LLC (“WAW”).


 


(To be Executed by
the WAW to Exercise the Option To Purchase Common Stock Evidenced by the Within
Retainer Agreement)


 


                WAW hereby irrevocably
subscribes for
              
shares of the Common Stock (the “Stock”) of XELR8 Holdings, Inc. (the “Company”)
pursuant to and in accordance with the terms and conditions of the Option
described in the attached Retainer Agreement between WAW and the Company (the “Option”),
and hereby makes payment of
$              
therefor by [tendering cash, wire transferring or delivering a certified check
or bank cashier’s check, payable to the order of the Company].  WAW requests that a certificate for the Stock
be issued in the name of the WAW and be delivered to WAW at the address stated
below.


 


                WAW understands that if at this
time the Stock has not been registered under the Securities Act of 1933 (the “Securities
Act”), WAW hereby represents to the Company that it is acquiring the Stock for
its own account for investment and not with a view to, or for resale in
connection with, a distribution of the shares within the meaning of the
Securities Act. WAW must hold such Stock indefinitely unless the Stock is
subsequently registered and qualified under the Securities Act or is exempt
from such registration and qualification. 
WAW shall make no transfer or disposition of the Stock unless (a) such
transfer or disposition can be made without registration under the Securities
Act by reason of a specific exemption from such registration and such
qualification, or (b) a registration statement has been filed pursuant to
the Securities Act and has been declared effective with respect to such
disposition.  WAW agrees that each
certificate representing the Stock delivered to it shall bear substantially the
same as the following:


 


THESE
SHARES OF COMMON STOCK HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE “SECURITIES ACT”), OR ANY OTHER SECURITIES LAWS, HAVE
BEEN TAKEN FOR INVESTMENT, AND MAY NOT BE SOLD OR TRANSFERRED OR OFFERED
FOR SALE OR TRANSFER UNLESS A REGISTRATION STATEMENT UNDER THE SECURITIES ACT
AND OTHER APPLICABLE SECURITIES LAWS WITH RESPECT TO SUCH SECURITIES IS THEN IN
EFFECT, OR IN THE OPINION OF COUNSEL TO THE ISSUER OF THESE SECURITIES, SUCH
REGISTRATION UNDER THE SECURITIES ACT AND OTHER APPLICABLE SECURITIES LAWS IS
NOT REQUIRED.


 


                WAW further agrees that the
Company may place stop transfer orders with its transfer agent same effect as
the above legend.  The legend and stop
transfer notice referred to above shall be removed only upon my furnishing to the
Company of an opinion of counsel (reasonably satisfactory to the Company) to
the effect that such legend may be removed.


 


	
  Date:                       

  	
  WOLFE AXELROD WEINBERGER ASSOC. LLC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Stephen
  D. Axelrod, CFA 

  Managing Member

  
	
   

  	
  Address:

  317
  Madison Avenue, Suite 515  

  New
  York, New York 10017

  



 


 


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INVOICE


 


XELR8 HOLDINGS, INC.


 


Retainer fee for the first month — January 15,
2008 to February 14, 2008                                                                       $8,000


 


 


 


 


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