Lombardi & Co., Inc.
29 Broadway @ Trinity
Place
New York, NY 10006
(212) 809-3951
Chairman of the
Board, President & Chief Executive Officer
Blackhawk
Capital Group BDC, Inc.
14 Wall Street,
Suite 1100B
This letter (the "Agreement") will confirm the
engagement of Lombardi & Co., Inc. ("Placement Agent") by
Blackhawk Capital Group BDC, Inc., a Delaware corporation and a
business development company registered under the Investment
Company Act of 1940, as amended (the "Company"), as placement agent
in connection with the Company's Rule 506 offering under Regulation
D under the Securities Act of 1933, as amended (the "Securities
Act"), of up to $250,000,000.00 in common stock ("Securities" or
“Shares”) to qualified institutional buyers ("QIBs")
and "accredited investors" (as those terms are defined under the
Securities Act) (the "Investors") (the
“Offering”). The Offering will be pursuant
to a Confidential Private Placement Memorandum dated July 8 2009
(“Memorandum”) and a subscription agreement and
purchase questionnaire ("Subscription Agreement"). The
maximum amount to be raised in the Offering is $250,000,000.00 (and
50,000,000 Shares have been sold). There is no minimum
requirement for the sale of Shares by the
Company. Closings will occur upon receipt of funds as
received. Investors must be advised that there is no
minimum amount of subscriptions that must be raised in the Offering
before the initial closing or any “rolling” closing can
take place. Funds will be placed into an escrow account
prior to any closing. The Company reserves the right to
lower the minimum or increase the maximum at its sole
discretion. The purchase price shall be $5.00 per
Share.
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Scope of
Placement Agent's Services . Placement Agent will assist in the
distribution of Offering Materials (as hereinafter defined) to
potential investors, report to the Company on the status of
potential investors, assist in consummating the Offering, and
perform such other services, as necessary and as requested by the
Company, including, but not limited to:
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familiarizing
itself to the extent it deems appropriate and feasible with the
business operations, financial condition, and prospects of the
Company,
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screening and
contacting prospective investors, and
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assisting in
negotiations with prospective investors.
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It is
understood by both parties that Placement Agent intends to solicit
interest from a limited number of potential Investors (QIBs and
accredited investors). Placement Agent will, in its sole
discretion, determine the reasonableness of their efforts and are
under no obligation to perform at any level other than what each
deems reasonable. The Company shall retain control of
the Offering and shall have the right to determine (a) whether to
accept and close the sale of the Securities to a specific Investor,
(b) whether to close or terminate the Offering, and (c) the content
of the Offering Materials. The Company shall retain control of the
Offering and shall have the right to determine (a) whether to
accept and close the sale of any Securities to a specific Investor,
(b) whether to close or terminate the Offering, (c) whether to
change any of the terms of the Offering, and (d) the content of the
Offering Materials.
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Fees . In return for Placement Agent's services in the
placement of Securities, the Company will pay Placement Agent a
cash fee equal to five percent (5%) of the gross proceeds (the
"Financing Fee") of any Securities placed by Placement
Agent. Any Financing Fees payable to Placement Agent
will be due at the respective closing date(s) of the Offering and
shall be payable to Placement Agent by the
Company. Placement Agent shall not be entitled to
receive the reimbursement of any expenses from the
Company.
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Term . Unless extended or earlier
terminated by mutual agreement in writing of the parties, the term
of this Agreement shall commence July 27, 2009 and terminate on the
earliest to occur of: (i) ten (10) calendar days after
written notice given to the Company by Placement Agent of a
potential Investor purchasing at least 50,000,000 Shares that will
close on the purchase of Shares within five (5) calendar days of
the date of such written notice; (ii) 180 calendar days from July
27, 2009; (iii) the date of closing and funding by any Investor of
a Subscription Agreement for a minimum of 50,000,000 Shares (the
"Term"); or (iv) ten (10) calendar days after written notice given
to Placement Agent by the Company that the Offering will be closed
at the sole discretion of the Company. Upon any
termination or expiration of this Agreement, neither the Company
nor a potential Placement Investor shall have any obligation or
liability to any other party under this Agreement. For a
period of 180 calendar days from July 27, 2009 ("Period"),
Placement Agent shall have the non-exclusive right on behalf of the
Company to solicit prospective Investors who are QIBs and/or
accredited investors regarding the possible sale to such Investors
of Shares. During the Period, Placement Agent shall not
have the right to conduct any other discussions on behalf of the
Company regarding any matter other than the sale of the Shares to
the prospective Investors. For purposes of
clarification, the Company during the Period shall deal on a
non-exclusive basis with Placement Agent concerning the sale of the
Shares.
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For a period up
to one year from the termination of this Agreement and if Placement
Agent enters into a selling group of any subsequent securities
offerings of the Company, then Placement Agent shall receive
additional financing fees ("Additional Fees") if the Company sells
securities to those Investors previously introduced by Placement
Agent ("Protected Investors"). Prior to the termination
date, Placement Agent will furnish the Company with a written list
of the Protected Investors. The Additional Fees will be
equal to any underwriting or placement fees that are listed in any
future offering circular or prospectus.
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Company
Information . The Company will furnish Placement
Agent such information concerning the Company as Placement Agent
reasonably determines to be appropriate with respect to the
Offering ("Information"). The Company shall afford
Placement Agent and its counsel and representatives full and
complete access to its books and records and will use commercially
reasonable efforts to afford Placement Agent with full and complete
cooperation of management to gather the Information on a reasonable
basis. The Company recognizes and confirms that
Placement Agent (a) will use and rely on the Information in
performing the services contemplated by this Agreement, without
independently verifying the accuracy and completeness of the same,
(b) does not assume responsibility for the accuracy or completeness
of the Information, and (c) will not make an appraisal of any
assets or liability of the Company.
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The Company
hereby represents to Placement Agent that all solicitation
materials prepared by the Company and used in connection with the
Offering, including, without limitation, the Confidential Private
Placement Memorandum (the "Offering Materials") will not, as of the
date of any offer or sale in connection with the Offering, contain
any untrue statement of a material fact or omit a material fact
necessary to make the statements contained therein, not misleading,
in light of the circumstances under which they were
made. If at any time an event occurs as a result of
which the Offering Materials, as then amended or supplemented,
would include an untrue statement of a material fact or omit to
state any material fact necessary to make the statements therein,
in light of the circumstances under which they were made when such
Offering Materials are delivered to a prospective purchaser
pursuant hereto, not misleading, the Company will promptly notify
Placement Agent to suspend solicitation of prospective purchasers
in connection with the Offering; and if the Company decides to
amend or supplement the Offering Materials, it will promptly advise
Placement Agent by telephone (with confirmation in writing) and
will promptly prepare an amendment or supplement that will correct
such statement or omission.
Placement Agent
will not violate, or cause the Company to violate, any applicable
federal and state securities laws in connection with the
Offering.
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Confidentiality . In connection with this engagement, it is
contemplated that Placement Agent will receive from the Company
certain information (including certain business planning,
investment, product, marketing, technical, financial, and other
information and ma
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