AMENDMENT AGREEMENT DATED JULY 13, 2007 BETWEEN BLACKHAWK AND SMH CAPITAL INC. SMH CAPITAL INC. July 13, 2007
Exhibit
10.3
AMENDMENT
AGREEMENT DATED JULY 13, 2007
BETWEEN
BLACKHAWK AND SMH CAPITAL INC.
SMH
CAPITAL INC.
July
13,
2007
Xx.
Xxxxx
X. Xxxxxx
Chairman
of the Board, President
and
Chief
Executive Officer
Blackhawk
Capital Group BDC, Inc.
00
Xxxx
Xxxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Dear
Sirs:
Reference
is made to the agreement dated October 31, 2006 ("Agreement") between Xxxxxxx
Xxxxxx Xxxxxx Inc., a Texas corporation ("SMH") and Blackhawk Capital Group
BDC,
Inc., a Delaware corporation (the "Company") and a business development company
registered under the Investment Company Act of 1940, as amended (the "Investment
Company Act"), pursuant to which SMH has acted as financial adviser and
placement agent to the Company for the Company's sale of a maximum amount of
5,000,000 shares of its common stock ("Securities") to accredited investors
in
the Company's Regulation E Offering ("Offering") under the Securities Act of
1933, as amended ("Securities Act"). The Agreement was supplemented by a letter
agreement dated January 27, 2007 ("First Amendment") between SMH and the Company
relating to the participation of Xxxxxx Xxxxxxxxxx Xxxxx in the Offering.
The
purpose of this letter agreement ("Second Amendment") is to amend Sections
2 and
3 of the Agreement relating to fees and expenses, and to clarify other
provisions of the Agreement. The parties agree that Section 2 of the Agreement
will be deleted in its entirety and replaced with the following:
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2.
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Fees
and Non-Exclusivity.
The Company shall not be responsible for the payment of any fees
(whether
advisory fees or placement agent fees) to SMH for any Securities
placed by
SMH between the date of this Agreement and July 16, 2007. SMH expressly
waives any fees for placing Securities during this period. For Securities
placed by SMH during the period from July 17, 2007 until the earlier
of
the termination of the Offering or the termination of this Agreement,
the
Company will pay SMH a cash fee equal to 9.00% of the gross proceeds
of
any Securities placed by SMH (consisting of a 2.00% advisory fee
and a
7.00% placement agent fee). Any fee contemplated in the above sentence
will be referred to as the "Financing Fees." Any Financing Fees payable
to
SMH will be due at the last and final closing of the Offering and
shall be
payable to SMH by the Company. No placement agent fee of 7.00% shall
be
payable by the Company to SMH for (i) investors introduced to SMH
by the
Company; (ii) Securities purchased in the Offering by the Company's
officers, directors, controlling stockholders or affiliates; and
(iii)
Securities purchased in the offering by any investor identified by
the
Company irrespective of whether such investor is introduced to SMH
or not.
However, the 2.00% advisory fee shall be payable by the Company to
SMH for
Securities purchased by investors listed in category (i) in the prior
sentence. The parties acknowledge and agree that SMH will not be
entitled
to any fees (whether placement agent fees or advisory fees) on debt
conversions by the Company's affiliate, The Concorde Group, Inc.
SMH's
services pursuant to this Agreement and the Offering shall be
non-exclusive.
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The
parties agree that Section 3 of the Agreement will be deleted in its entirety
and replaced with the following:
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3.
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Expenses.
The Company shall not be responsible for paying any expenses of SMH
relating to this Agreement or the Offering, except for expenses in
the
amount of $2,300 incurred by SMH prior to July 16, 2007 which will
be paid
at the end of the Offering upon delivery of valid receipts.
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The
following paragraph at the top of page 5 of the Agreement shall be deleted
in
its entirety:
The
Company shall have the right to identify investors with which it has
affiliations who would be suitable accredited investors for the Offering
("Company-Introduced Investors"), and introduce these investors to SMH for
the
Offering. In the event that SMH and the Company decide that these investors
are
suitable for the Offering and purchase Securities in the Offering, fees shall
be
due to SMH respecting Securities purchased by Company-Introduced Investors
pursuant to Section 2 above.
The
parties further agree that as to Exhibit A of the Agreement, (i) the reference
to minimum Offering amount and shares shall be reduced from $3,500,000 and
3,500,000 respectively, to $500,000 and 500,000, respectively; and (iv) the
reference to the Company filing a registration statement shall be deleted in
its
entirety.
Except
as
amended and supplemented by the First Amendment and this Second Amendment,
the
terms of Agreement shall remain in effect.
If
this
Second Amendment reflects our mutual understanding, please execute two copies
in
the space indicated below and return one to us.
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Very
truly yours,
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SMH
CAPITAL INC.
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/s/
XXXXXXX X. XXXXX
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Xxxxxxx
X. Xxxxx
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Managing
Director-Financial Services
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Accepted
and agreed to as of July 13, 2007.
BLACKHAWK
CAPITAL GROUP BDC, INC.
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Xx.
Xxxxx X. Xxxxxx
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And
Chief Executive
Officer
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