Exhibit
10.14


 


Gerbsman
Partners


211 Laurel
Grove Ave.


Kentfield, CA
94909


415-456-0628
telephone


415-459-2278
FAX


August 7, 2009


 


Henry A. Plain, Jr.


Chairman of the Board


Xtent, Inc.


125 Constitution Avenue


Palo Alto, CA 94025


 


Dear Hank:


 


I would like to thank you for your time, courtesy and
confidence in Gerbsman Partners. For your review, I have outlined below an
agreement (“Agreement”) whereby TGI Financial, Inc. a California
Corporation, doing business as Gerbsman Partners (“Gerbsman Partners”) will assist
Xtent, Inc.. (“Client”) as a business consultant and investment banker
solely in developing and executing an action plan for maximizing enterprise
value of Client assets.


 


Set forth below are the services Gerbsman Partners will
perform for Client, as an independent contractor, and the compensation which
Gerbsman Partners will receive from Client for those services. Kenneth Hardesty
and Dennis Sholl will be working on this assignment with Steven R. Gerbsman.


 


1.         Scope of Engagement


 


On May 11,
2009, Client’s board of directors approved a Complete Plan of Dissolution and
Liquidation (the “Plan of Dissolution”) and on August 3, 2009, at a
special meeting of Client’s stockholders, the Plan of Dissolution was approved
Client’s stockholders.  Gerbsman Partners
agrees to provide the following services pursuant to the Plan of Dissolution:


 


(1)       To
assist Client in maximizing enterprise value of Client;


 


(2)       To
work with Client to develop and implement a strategy/action plan for maximizing
enterprise value of Client;


 


(3)       To
assist the Client in maximizing enterprise value of Client’s assets and, at the
direction of the Client, assume responsibility for a “Date Certain M&A
sales process” to maximize value of Client’s assets;


 


(4)       To
communicate with Client, and with Client’s board of directors and senior
management, on a daily and weekly basis on the progress of such plan to
maximize enterprise value.


 


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2.         Gerbsman Partners Compensation


 


In
consideration for performing services hereunder, Gerbsman Partners will be
compensated as follows:


 


(1)       Non-Refundable
Retainer


 


A $125,000
non-refundable retainer paid on the signing of this Agreement.


 


Gerbsman Partners will be utilizing additional resources of Client
and will not invoice Client for any services of additional resources, except
for travel expenses. All travel expenses will be reviewed with and pre-approved
by Client.  There will be no travel
expenses in the Bay Area.


 


(2)       Performance
Fee.


 


If a sale, merger, purchase of equity, asset sale,
acquisition, assumption of debt or full or partial transfer of assets,
including a full or partial transfer of contractual rights and/or intellectual
property (“Transaction”), whether separately or in combination, is completed for
all or part of Client, Gerbsman Partners will receive a performance fee (“Performance
Fee”) of:


 


*Ten Percent (10%) of the
first $ 1 million Transaction Value (as defined below), plus


 


*Eight Percent (8%) of the Transaction Value from $1 million
to $ 2 million, plus


 


*Six Percent (6%) of the Transaction Value in excess of $ 2
million.


 


Transaction Value (“Transaction Value”) is defined as the
total consideration paid by a buyer or buyers to Client or to Client’s
shareholders or creditors in a Transaction or Series of Transactions. The
form of consideration may include, but is not limited to, debt, equity,
warrants, options, cash, any other transfer of value or any combination
thereof.  Pursuant to this agreement,
Client may from time to time request Gerbsman Partners to assist Client in
reducing specific obligations or liabilities of Client.  Gerbsman Partners will use best efforts in this
regard, however Gerbsman Partners makes no guarantee of any success.  In the event
any such obligation or liability is equal to or greater than $1,000,000 on the
date this letter is executed, then Gerbsman Partners will be under no
obligation to assist Client in reducing such liability or obligation unless and
until the parties agree on a separate fee for such services.  In the event that there are multiple
Transactions, the Performance Fee will be paid on the sum total Transaction
Value of all the Transactions combined. 
Transaction Value does not include the amount of cash held by Client as
of the date this letter is executed by both parties.


 


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Notwithstanding the foregoing, Gerbsman Partners minimum
Performance Fee will be $100,000 Cash, upon the closing of a Transaction. The
Performance Fee is in addition to the Non-Refundable Retainer. The
Non-Refundable Retainer will specifically not be offset against the Performance
Fee or against the minimum Performance Fee.


 


(3)       Payable Date
for Performance Fee


 


The Performance Fee is due and
payable to Gerbsman Partners by Client upon the closing and receipt of funds of
any Transaction as defined in the Performance Fee section above.  In the event that the proceeds of any
Transaction, or any portion thereof, are held in escrow or paid over time, the
amount of any Performance Fee in excess of the $100,000 minimum Performance Fee
set forth above will become due and payable when and as such proceeds are
received by or released to Client.


 


(4)       Reasonable
Business Expenses


 


Reasonable business expenses, which may include travel and
other pre-approved expenses, will be reimbursed to Gerbsman Partners on a
weekly basis and will include a detailed expense report and adequate proof of
any expenditure. Gerbsman Partners will not invoice Client for any business
expenses incurred in the San Francisco Bay Area.


 


3.         No Guarantee of Success


 


Gerbsman Partners cannot guarantee the successful completion
of Client maximizing the value of Client and its assets and makes no such
guarantee herein. Gerbsman Partners does guarantee to use best efforts within commercial
reasonableness to complete the tasks described herein and to operate at all
times in a skilled professional manner and in accordance with the direction of
Client management.


 


4.         Confidentiality


 


Gerbsman Partners agrees to maintain the confidentiality of
any information it learns from Client except as is necessary to fulfill the
functions described in the Agreement and such confidentiality obligation will
continue for a period of one year after termination of this Agreement, except
where information is part of the public domain prior to the date of this
Agreement; or such information becomes part of the public domain not due to
some unauthorized act or omission of Gerbsman Partners after this Agreement is
executed; or Gerbsman Partners can demonstrate that it had independently
developed knowledge of such information prior to the date of this Agreement; or
such information is disclosed to Gerbsman Partners by a third party who has the
right to make such disclosure; or permission to disclose said information or to
make use thereof is obtained by Gerbsman Partners from Client.


 


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5.         Indemnification


 


In
consideration of Gerbsman Partners agreement to perform services and Client
agreement to pay for such services under the terms of this engagement, Client
will:


 


(1)       Indemnify
and hold harmless Gerbsman Partners and any of its directors, officers,
employees, consultants or agents (each, individually, an “Indemnified Person”)
from any losses, claims, damages or liabilities to which such Indemnified
Person may become subject primarily arising out of or in connection with the
rendering of services by Gerbsman Partners hereunder, except to the extent that
such losses, claims, damages or liabilities have resulted from the gross
negligence or recklessness or willful misconduct of any Indemnified Person; and


 


(2)       Except as
otherwise provided in the following paragraph, reimburse such Indemnified
Person for reasonable legal or other expenses, as they are incurred, that arise
in connection with investigating, preparing to defend or defending any lawsuit,
claim or proceeding and any appeals there from arising in any manner out of or
in connection with the rendering of services by Gerbsman Partners hereunder
except to the extent that such lawsuit or claim arises out of the gross
negligence or recklessness or willful misconduct of any Indemnified Person;
provided, however, that (i) in the event a final judicial determination is
made to the effect specified in subparagraph (1) above, such Indemnified
Person promptly will remit to Client any amounts reimbursed under this
subparagraph (2) and (ii) each Indemnified Person will, to the extent
possible, provide the company with prior notice of such expense and will use
reasonable efforts to minimize same, and (iii) at all times control over
any defense, settlement and/or expenses will be subject to the control of
Client


 


(3)       Client and
Gerbsman Partners agree that the above indemnification and reimbursement
commitments set forth above will apply whether or not such Indemnified Person
is named party to any such lawsuit, claim or other proceeding and promptly
after receipt by Gerbsman Partners of notice of its involvement in any action,
proceeding or investigation, it will, if a claim in respect thereof is to be
made under the preceding paragraph, notify the Company in writing of such
involvement. To the extent it wishes, the Company will be entitled to assume
the defense of any action which is the subject of the preceding paragraph with
counsel reasonably satisfactory to Gerbsman Partners and the payment of fees
and expenses of such counsel, provided that Gerbsman Partners will have the
right to control its defense if, in the opinion of counsel, Gerbsman Partners
defense is in conflict or potential conflict with a defense pertaining to the
Company. In such event, Gerbsman Partners will have the right to retain counsel
reasonably satisfactory to the Company, at the Company’s expense, to represent
Gerbsman Partners in any claim or action in respect of which indemnity may be
sought and Gerbsman Partners agrees to cooperate with the Company and the
Company’s counsel in the defense of such claim or action. In the event that the
Company does not promptly assume the defense of a claim or action, Gerbsman
Partners will have the right to employ counsel reasonably satisfactory to the
Company, at the Company’s expense, to defend such claim or action.


 


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6.         Term and Miscellaneous Provisions


 


(1)       This Agreement
will have a term commencing on the date hereof and ending one year from the
date of execution. Nevertheless, this Agreement may be terminated by Client
with 3-business day’s prior written notice and by Gerbsman Partners after 60
days from the signing of this Agreement. In the event of any such termination
of this Agreement by Client, Client will continue to be obligated to pay to
Gerbsman Partners the Performance Fee as outlined above upon the successful
completion of any Transaction within one year following the termination date of
this Agreement and any reasonable out-of-pocket expenses incurred by Gerbsman
Partners through the termination date of this Agreement. If Gerbsman Partners
terminates this Agreement for any reason other than for non-payment by Client
of the retainer, then Client will not be obligated to pay Gerbsman Partners any
Performance Fee but will be obligated to pay any reasonable out-of-pocket
expenses incurred by Gerbsman Partners through the date of termination of this
Agreement.  In such event, Gerbsman
Partners will return to Client the amount of the non-refundable retainer
previously paid to Gerbsman Partners by Client.


 


Notwithstanding the above, Client will notify Gerbsman
Partners in writing (fax or email), on or before August 14, 2009 as to
whether Client wants Gerbsman Partners to proceed with the Date Certain M&A
Process.  If Client does not notify
Gerbsman Partners in writing, then this Agreement is terminated.


 


(2)       Client will
cooperate with, and make available to, Gerbsman Partners all information that
Gerbsman Partners reasonably requests in connection with the performance of
services hereunder, including all information concerning the business, assets,
operations or financial condition of Client. Gerbsman Partners may rely upon
the accuracy and completeness of such information without independent
verification and is authorized to make appropriate use of such information.


 


(3)       It is
understood that at all times, Client will have the sole right to accept or
reject any proposed sale, merger, asset sale of all or part of Client, and to
approve or disapprove any terms or conditions of any such proposed sale, merger
or asset sale. In rendering services to Client hereunder, Gerbsman Partners is
not assuming any responsibility for Client’s underlying business decision to
maximize value of Client and its assets.


 


(4)       The
indemnity and expense reimbursement liability of Client will remain operative
and in full force and effect regardless of any termination.


 


(5)       This
Agreement will be governed by the laws of the State of California and may be
amended only in writing signed by both parties.


 


(6)       If any
provision of this Agreement should become unenforceable, invalid, or declared
illegal, then that provision will be considered severed from the rest of this
Agreement and will not affect the validity of the remainder of this Agreement.


 


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(7)       In any
litigation, arbitration or court proceeding between the parties, the prevailing
party will be entitled to recover, in addition to any other amounts awarded,
attorneys’ fees and all costs of proceedings incurred in enforcing this
Agreement.


 


(8)       Any portion of the Performance Fee due under this
Agreement and not paid per the terms of this Agreement will earn interest
payable to Gerbsman Partners at the interest rate of eighteen percent (18%) per
annum, compounded daily, provided, however, that the interest rate will in no
event exceed the maximum interest rate permitted by law.


 


(9)       Any dispute or controversy arising under, out of or in
connection with this Agreement will be resolved by binding arbitration
conducted in the county of San Francisco, California under JAMS
(www.jamsadr.com) and will be commenced within 30 days of any party’s written request
to the other party. The written request will identify the issues to be
arbitrated and will suggest an arbitrator. If the receiving party does not
agree to the suggested arbitrator, the arbitrator will be chosen by the
procedures of JAMS. Any final arbitration decision rendered pursuant to this
Agreement will be non-appealable and may be enforced in any court of competent
jurisdiction. Except as otherwise provided in this Agreement, each party will
bear its own legal fees, costs and other expenses incurred in any arbitration
brought under this Agreement. The parties intend that this agreement to
arbitrate be irrevocable.


 


I would like to thank you for your trust and confidence.
Please execute the acknowledgment below and remit cashiers check or wire transfer,
in the amount of $125,000, to TGI Financial, Inc.


 


 


	
  Sincerely,

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/ Steven R. Gerbsman

  	
   

  	
   

  	
  8-7-09

  
	
  Steven R. Gerbsman

  	
   

  	
   

  	
  Date

  
	
  Principal

  	
   

  	
   

  
	
  Gerbsman Partners

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Accepted:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/ Henry A. Plain, Jr.

  	
   

  	
   

  	
  8-7-09

  
	
  Henry A. Plain, Jr.

  	
   

  	
   

  	
  Date

  
	
  Chairman of the Board

  	
   

  	
   

  
	
  Xtent, Inc.

  	
   

  	
   

  
					



 


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