Form of Amended and Restated Purchaser Support Agreement

EX-10.1 2 tm2231736d1_ex10-1.htm EXHIBIT 10.1

Exhibit 10.1

 

AMENDED AND RESTATED PURCHASER SUPPORT AGREEMENT

 

This AMENDED AND RESTATED PURCHASER SUPPORT AGREEMENT, dated as of November [_], 2022 (this “Agreement”), is entered into by and among the persons listed on the signature page hereto (each, a “Supporter”), ProSomnus Holdings Inc., a Delaware corporation (the “Company”), and Lakeshore Acquisition I Corp., a Cayman Islands exempted company (“Purchaser”). Capitalized terms used but not defined in this Agreement shall have the meanings ascribed to them in the Merger Agreement (as defined below).

 

WHEREAS, Purchaser and the Company are parties to that certain Agreement and Plan of Merger, dated May 9, 2022, as amended, modified or supplemented from time to time (the “Merger Agreement”), pursuant to which, among other things, Merger Sub will merge with and into the Company, with the Company continuing as the surviving entity (the “Merger”), and with the Company’s stockholders receiving shares of the Purchaser’s common stock;

 

WHEREAS, the Supporters entered into that certain Purchaser Support Agreement, dated as of May 9, 2022 (the “Original Purchaser Support Agreement”), by and among the Supporters, the Company and the Purchaser;

 

WHEREAS, the Purchaser issued to the Supporters (i) 1,366,750 ordinary shares, par value $0.0001,of Purchaser (the “Founder Shares”) prior to the consummation of its initial public offering (the “IPO”) and (ii) 261,675 private units, each consisting of one ordinary share (each such share, together with the Founder Shares, the “Supporter Shares”) and three-quarters of one warrant, in a private placement that occurred concurrently with the IPO; and

 

WHEREAS, pursuant to Section 9 of the Original Purchaser Support Agreement, the Supporters, the Company and the Purchaser now desire to amend and restate the Original Purchaser Support Agreement in its entirety.

 

NOW, THEREFORE, in consideration of the foregoing and of the mutual covenants and agreements contained herein, and intending to be legally bound hereby, the parties hereby agree as follows:

 

1. Voting Agreements. Each Supporter, in such Supporter’s capacity as a stockholder of Purchaser, agrees that, during the term of this Agreement, at the extraordinary general meeting of Purchaser’s shareholders (the “Purchaser Extraordinary General Meeting”) to be called and held in connection with the transactions contemplated by the Merger Agreement (the “Transactions”), or at any other meeting of Purchaser’s shareholders called and held for such purpose (whether ordinary or extraordinary and whether or not an adjourned or postponed meeting, however called and including any adjournment or postponement thereof), and in connection with any written consent of Purchaser’s shareholders related to the transactions contemplated by the Merger Agreement (the Purchaser Extraordinary General Meeting and all other meetings or consents related to the Merger Agreement, collectively referred to herein as the “Meeting”), such Supporter shall:

 

  (a) when the Meeting is held, appear at the Meeting or otherwise cause the Supporter Shares owned by such Supporter to be counted as present thereat for the purpose of establishing a quorum;
     
  (b) vote (or execute and return an action by written consent), or cause to be voted at the Meeting (or validly execute and return and cause such consent to be granted with respect to), all of the Supporter Shares owned by such Supporter in favor of each of the Purchaser Shareholder Approval Matters; and
     
  (c) vote (or execute and return an action by written consent), or cause to be voted at the Meeting (or validly execute and return and cause such consent to be granted with respect to), all of the Supporter Shares owned by such Supporter against any other action that would reasonably be expected to (x) impede, interfere with, delay, postpone or adversely affect the Merger or any of the Transactions, (y) result in a breach of any covenant, representation or warranty or other obligation or agreement of Purchaser under the Merger Agreement or (z) result in a breach of any covenant, representation or warranty or other obligation or agreement of such Supporter contained in this Agreement.

 

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2. Founder Share Transfer. In connection with and effective immediately prior to the Closing, up to an aggregate of 42% of the Founder Shares held by each Supporter (the “Transferred Founder Shares”) may be automatically (and with no further action by the Supporters) transferred by such Supporter to Equity Investors for no consideration (the “Supporter Share Transfer”). The aggregate number of Transferred Founder Shares shall be equal to the sum of Founder Shares committed by Purchaser to Equity Investors under the Equity Agreements. Each Equity Investor shall represent to the Purchaser that it qualifies as an accredited investor under the Securities Act. If the aggregate number of Transferred Founder Shares is equal to or greater than 273,350 Transferred Founder Shares (the “20% Threshold”), Purchaser shall issue a full warrant (the “Additional Warrants”) to the Supporters for each Transferred Founder Share transferred above the 20% Threshold; provided, further, that in no event shall the aggregate number of Transferred Founder Shares be greater than 574,035. Each Supporter shall transfer Transferred Founder Shares and receive Additional Warrants on a pro rata basis based on the aggregate number of Founder Shares owned by such person as compared to the total number of Founder Shares outstanding. For the avoidance of doubt, any Additional Warrants issued pursuant to this Section 2 shall be identical to the Purchaser Private Warrants. Each Supporter shall take any and all such actions as are necessary or desirable to cause the Supporter Share Transfer.

 

In accordance with the terms of the Equity Agreements, Purchaser shall issue one additional share of Purchaser Common Stock to Investors for each Transferred Founder Share transferred pursuant to this Section 2.

 

3. Restrictions on Transfer. Except as provided in Section 2 hereof, each Supporter agrees that, during the term of this Agreement, such Supporter shall not sell, assign or otherwise transfer any of the Supporter Shares owned by such Supporter; provided, however, that the foregoing shall not prohibit transfers between such Supporter and any Affiliate of such Supporter, so long as, prior to and as a condition to the effectiveness of any such transfer, such Affiliate executes a joinder agreement to this Agreement in a form reasonably acceptable to the Company. Purchaser shall not register any sale, assignment or transfer of the Supporter Shares on Purchaser’s transfer (book entry or otherwise) that is not in compliance with this Section 3.

 

4. Waiver of Anti-Dilution Protection. Each Supporter hereby waives, forfeits, surrenders and agrees not to exercise, assert or claim, to the fullest extent permitted by applicable Law, any anti-dilution protection (if any) pursuant to the Organizational Documents of Purchaser in connection with the Transactions. Each Supporter acknowledges and agrees that (i) this Section 4 shall constitute written consent waiving, forfeiting and surrendering any anti-dilution protection pursuant to the Organizational Documents of Purchaser in connection with the Transactions; and (ii) such waiver, forfeiture and surrender granted hereunder shall only terminate upon the termination of this Agreement.

 

5. Lock-Up. Subject to the consummation of the Merger, each Supporter shall be restricted from selling, transferring or otherwise disposing of, directly or indirectly, any Purchaser Common Stock converted into or received by such Supporter as a result of the Merger (the “Lock-up Shares”) in the same way as set forth in the lock-up provisions of the Purchaser’s final prospectus filed with the U.S. Securities and Exchange Commission on June 14, 2021 (the “Final Prospectus”). Each Supporter hereby authorizes and requests Purchaser to notify Purchaser’s transfer agent that there is a stop transfer order with respect to all of the Lock-up Shares. Such stop-transfer order shall be removed upon expiration of the applicable lock-up period.

 

6. Fees; Loan Repayments. Except as provided in the Final Prospectus and the Letter Agreement, dated June 10, 2021, by and among Purchaser and its officers, directors and shareholders, none of the Supporters nor any affiliate of any Supporter, nor any director or officer of Purchaser, shall receive from Purchaser any finder’s fee, reimbursement, consulting fee, non-cash payments, monies in respect of any repayment of a loan or other compensation prior to the Merger.

 

7. Supporter Representations. Each Supporter represents and warrants to Purchaser and the Company, as of the date hereof, that:

 

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  (a) such Supporter has never been suspended or expelled from membership in any securities or commodities exchange or association or had a securities or commodities license or registration denied, suspended or revoked;
     
  (b) such Supporter has full right and power, without violating any agreement to which such Supporter is bound (including, without limitation, any non-competition or non-solicitation agreement with any employer or former employer), to enter into this Agreement;
     
  (c) (i) if such Supporter is not an individual, then such Supporter is duly organized, validly existing and in good standing under the Laws of the jurisdiction in which it is organized, and the execution, delivery and performance of this Agreement and the consummation of the transactions contemplated hereby are within such Supporter’s organizational powers and have been duly authorized by all necessary organizational actions on the part of such Supporter and (ii) if such Supporter is an individual, then the signature on this Agreement is genuine, and such Supporter has legal competence and capacity to execute the same;
     
  (d) this Agreement has been duly executed and delivered by such Supporter and, assuming due authorization, execution and delivery by the other parties to this Agreement, this Agreement constitutes a legally valid and binding obligation of such Supporter, enforceable against such Supporter in accordance with the terms hereof (except as enforceability may be limited by bankruptcy Laws, other similar Laws affecting creditors’ rights and general principles of equity affecting the availability of specific performance and other equitable remedies);
     
  (e) the execution and delivery of this Agreement by such Supporter does not, and the performance by such Supporter of such Supporter’s obligations hereunder will not, (i) conflict with or result in a violation of the organizational documents of such Supporter, or (ii) require any consent or approval from any third party that has not been given or other action that has not been taken by any third party, in each case, to the extent such consent, approval or other action would prevent, enjoin or materially delay the performance by such Supporter of such Supporter’s obligations under this Agreement;
     
  (f) there are no Actions pending against such Supporter or, to the knowledge of such Supporter, threatened against such Supporter, before (or, in the case of threatened Actions, that would be before) any Authority, which in any manner challenges or seeks to prevent, enjoin or materially delay the performance by such Supporter of such Supporter’s obligations under this Agreement;
     
  (g) no broker, finder, investment banker or other Person is entitled to any brokerage fee, finders’ fee or other commission in connection with this Agreement or any of the respective transactions contemplated hereby, based upon arrangements made by such Supporter or, to the knowledge of such Supporter, by Purchaser;
     
  (h) such Supporter has had the opportunity to read the Merger Agreement and this Agreement and has had the opportunity to consult with such Supporter’s tax and legal advisors;
     
  (i) such Supporter has not entered into, and shall not enter into, any agreement that would prevent such Supporter from performing any of such Supporter’s obligations hereunder;
     
  (j) such Supporter has good title to the Supporter Shares beneficially owned by such Supporter, free and clear of any Liens other than Permitted Liens, and such Supporter has the sole power to vote or cause to be voted such Supporter Shares; and
     
  (k) the Supporter Shares set forth in the records of the Purchaser’s transfer agent are the only Supporter Shares owned of record or beneficially owned by such Supporter as of the date hereof, and none of such Supporter Shares are subject to any proxy, voting trust or other agreement or arrangement with respect to the voting of such Supporter Shares that is inconsistent with such Supporter’s obligations pursuant to this Agreement.

 

8. Damages; Remedies. Each Supporter hereby agrees and acknowledges that (a) Purchaser and the Company would be irreparably injured in the event of a breach by such Supporter of such Supporter’s obligations under this Agreement, (b) monetary damages may not be an adequate remedy for such breach and (c) the non-breaching party shall be entitled to seek injunctive relief, in addition to any other remedy that such party may have in law or in equity, in the event of such breach.

 

9. Entire Agreement; Amendment. This Agreement and the other agreements referenced herein constitute the entire agreement and understanding of the parties hereto in respect of the subject matter hereof and supersede all prior understandings, agreements or representations by or among the parties hereto, written or oral, to the extent they relate in any way to the subject matter hereof or the transactions contemplated hereby. This Agreement may not be changed, amended, modified or waived (other than to correct a typographical error) as to any particular provision, except by a written instrument executed by all parties hereto.

 

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10. Assignment. No party hereto may, except in accordance with Section 3, assign either this Agreement or any of its rights, interests, or obligations hereunder without the prior written consent of the other parties. Any purported assignment in violation of this paragraph shall be void and ineffectual and shall not operate to transfer or assign any interest or title to the purported assignee. This Agreement shall be binding on each Supporter, Purchaser and the Company and each of their respective successors, heirs, personal representatives and assigns and permitted transferees.

 

11. Counterparts. This Agreement may be executed in any number of original, electronic or facsimile counterparts and each of such counterparts shall for all purposes be deemed to be an original, and all such counterparts shall together constitute but one and the same instrument.

  

12. Severability. This Agreement shall be deemed severable, and the invalidity or unenforceability of any term or provision hereof shall not affect the validity or enforceability of this Agreement or of any other term or provision hereof. Furthermore, in lieu of any such invalid or unenforceable term or provision, the parties hereto intend that there shall be added as a part of this Agreement a provision as similar in terms to such invalid or unenforceable provision as may be possible and be valid and enforceable.

 

13. Governing Law; Jurisdiction; Jury Trial Waiver. Section 10.5, Section 10.6, and Section 10.7 of the Merger Agreement are incorporated by reference herein to apply with full force to any disputes arising under this Agreement.

 

14. Notice. Any notice, consent or request to be given in connection with any of the terms or provisions of this Agreement shall be in writing and shall be sent or given in accordance with the terms of Section 10.2 of the Merger Agreement to the applicable party, with respect to the Company and Purchaser, at the respective addresses set forth in Section 10.2 of the Merger Agreement, and, with respect to each Supporter, at the address set forth in the Purchaser’s records.

 

15. Termination. This Agreement shall terminate on the earlier of the Closing or the termination of the Merger Agreement. No such termination shall relieve each Supporter, Purchaser or the Company from any liability resulting from a breach of this Agreement occurring prior to such termination.

 

16. Adjustment for Stock Split. If, and as often as, there are any changes in Purchaser or the Supporter Shares by way of stock split, stock dividend, combination or reclassification, or through merger, consolidation, reorganization, recapitalization or business combination, or by any other means, equitable adjustment shall be made to the provisions of this Agreement as may be required so that the rights, privileges, duties and obligations hereunder shall continue with respect to each Supporter, Purchaser, the Company, the Supporter Shares as so changed.

 

17. Further Actions. Each of the parties hereto agrees to execute and deliver hereafter any further document, agreement or instrument of assignment, transfer or conveyance as may be necessary or desirable to effectuate the purposes hereof and as may be reasonably requested in writing by another party hereto.

 

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IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first written above.

 

  PROSOMNUS HOLDINGS INC.
   
  By:                                                                                                                       
  Name:
  Title:
   
  LAKESHORE ACQUISITION I CORP.
   
  By:                                                                                                                     
  Name:
  Title:
   
  SUPPORTERS
   
  REDONE INVESTMENT LIMITED
   
  By:                                                                                                                     
  Name:
  Title:
   
  [____________________]
  [____________________]

 

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