As of October 11, 2005 Mr. James Conway Chairman and CEO Netsmart Technologies, Inc. Great River, NY 11739 Dear Jim:
EXHIBIT
10.2
As
of
October 11, 2005
Mr.
▇▇▇▇▇
▇▇▇▇▇▇
Chairman
and CEO
Netsmart
Technologies, Inc.
▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
Great
River, NY 11739
Dear
▇▇▇:
Pursuant
to a letter agreement between Netsmart Technologies, Inc. (“Client”) and ▇▇▇▇▇▇▇
Securities, Inc. ("▇▇▇▇▇▇▇") dated as of August 9, 2005 (the “Agreement”),
Client engaged ▇▇▇▇▇▇▇ to act on a best efforts basis as financial advisor
and
placement agent for the Client in connection with the issuance and sale of
common stock and warrants for financing purposes.
Pursuant
to the Agreement, ▇▇▇▇▇▇▇ acted as placement agent in connection with the
Client’s offer and sale of units (the “Transaction”) consisting of 490,000
shares of common stock and warrants to purchase 122,504 shares of common
stock
(the “Securities”). In connection with the Transaction, Client entered into a
participation agreement with the Investors, pursuant to which the Investors
were
given a right to participate in Client’s future private offering transactions
(“Future Offerings”) for a period of two years from the consummation of the
Transaction (the “Participation Period”).
Client
and ▇▇▇▇▇▇▇ now desire to amend certain provisions of the Agreement.
Accordingly,
we mutually agree as follows:
| 1. |
Section
3 of the Agreement is hereby amended and restated as follows:
|
“3. Success
Fee. If
during
the term of this Agreement, Client accepts financing from any Investor
introduced (including for such purposes investors introduced by persons
introduced by ▇▇▇▇▇▇▇) to Client by ▇▇▇▇▇▇▇ prior to or during the term of
this
Agreement (as defined in Section 6 below), there shall become due and payable
via wire transfer to ▇▇▇▇▇▇▇ immediately upon consummation of each such
Transaction, a cash fee equal to six and 12/100 percent (6.12%) of the gross
proceeds payable to Client from the sale of Securities. If Client should
during
the Participation Period accept financing from any Investor introduced by
▇▇▇▇▇▇▇ (excluding for such purposes investors introduced by persons introduced
by ▇▇▇▇▇▇▇ other than any such investors who purchased Securities during
the
term of this Agreement) prior to or during the term of this Agreement, there
shall become due and payable via wire transfer to ▇▇▇▇▇▇▇ immediately upon
consummation of each such Transaction, a cash fee equal to five percent (5%)
of
the gross proceeds payable to Client from the sale of Securities.”
| 2. |
Section
4 of the Agreement is hereby amended and restated as follows:
|
“4. Warrants. As
additional consideration for each completed Transaction, (i) upon the sale
of
Securities during the term of this Agreement to Investors introduced (including
for such purposes investors introduced by persons introduced by ▇▇▇▇▇▇▇)
to
Client by ▇▇▇▇▇▇▇ prior to or during the term of this Agreement and (ii)
upon
the sale of Securities in Future Offerings during the Participation Period
to
Investors introduced (excluding for such purposes investors introduced by
persons introduced by ▇▇▇▇▇▇▇ other than any such investors who purchased
Securities during the term of this Agreement) to Client by ▇▇▇▇▇▇▇ prior
to or
during the term of this Agreement, Client shall promptly ▇▇▇▇▇ ▇▇▇▇▇▇▇ warrants
for the purchase of an amount equal to five percent (5%) of the Securities
issued in such completed Transaction. The warrants to purchase common stock
issued pursuant to Section 4 (i) shall be exercisable over a five (5) year
period, have an exercise price equal to the exercise price of the Investor’s
warrants and contain other customary terms as Client and ▇▇▇▇▇▇▇ agree,
including the ability to assign the warrants to other accredited representatives
of ▇▇▇▇▇▇▇. The warrants to purchase common stock issued pursuant to Section
4(ii) of this Section 4 shall be on the terms provided for any such warrant
in
any Future Offering, or if no warrants are to be issued in any Future Offering,
on terms to be agreed by Client and ▇▇▇▇▇▇▇.”
| 3. |
Capitalized
terms not otherwise defined herein shall have the meanings ascribed
to
them in the Agreement.
|
| 4. |
Except
as specifically provided herein, the Agreement is in all other respects
hereby ratified and confirmed without
amendment.
|
| 5. |
This
Agreement shall be governed by and construed in accordance with the
laws
of the State of New York applicable to contracts executed and to
be wholly
performed therein. The prevailing party shall be entitled to a reasonable
sum of attorney’s fees and any other reasonable costs and expenses
relating thereto.
|
| 6. |
The
Agreement, as amended hereby, represents the entire agreement by
and
between the Client and ▇▇▇▇▇▇▇ and supersedes any and all other
agreements, either oral or written, with respect to the subject matter
hereof. This letter may be executed simultaneously in two or more
counterparts, each of which shall be deemed an original, but all
of which
shall constitute one and the same instrument. Any modification of
this
letter will be effective only if it is in writing and signed by the
Client
and ▇▇▇▇▇▇▇.
|
Please
sign below, and return an original of this letter to the undersigned to indicate
your acceptance of the terms set forth herein, whereupon this letter shall
constitute a binding agreement by and between Client Inc. and ▇▇▇▇▇▇▇
Securities, Inc. as of the date first above written.
| Sincerely, | Accepted and Agreed: | ||
| /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇ | /s/ ▇▇▇▇▇ ▇▇▇▇▇▇ | ||
|
|
|
||
| ▇▇▇▇▇▇▇
Securities, Inc. By: ▇▇▇▇▇▇ ▇▇▇▇▇▇ Its: President & CEO |
Netsmart
Technologies, Inc. By: ▇▇▇▇▇ ▇▇▇▇▇▇ Its: Chairman & CEO |
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