PUT AND CALL OPTION
AGREEMENT
THIS PUT AND CALL OPTION AGREEMENT (this “
Agreement ”) is dated as of August 17, 2009 by and
among Barry J. Gordon (“ Gordon ”), Marc H. Klee
(“ Klee ”), Robert Sroka (“ Sroka
”), Arthur H. Goldberg (“ Goldberg ”),
Harvey Granat (“ Granat ”), Alan J. Loewenstein
(“ Loewenstein ”), Sang-Chul Kim (the “
Investor ”) and North Shore Acquisition Corp., a
Delaware corporation (the “ Company ”). Gordon,
Klee, Sroka, Goldberg, Granat and Loewenstein are each herein
referred to individually as a “ Seller ” and
collectively as the “ Sellers ”.
RECITALS
The Company was formed on June 26, 2007 for the
purpose of acquiring an operating business (“ Business
Combination ”).
Sellers collectively own an aggregate of
1,600,000 warrants to purchase shares of common stock, par value
$0.0001 per share (the “ Common Stock ”), of the
Company (the “ Warrants ”). In
addition, Sellers collectively own an aggregate of 1,588,250 shares
(the “ Shares ”) of Common Stock of the
Company.
Gordon, Klee, Sroka, Goldberg, Granat and
Loewenstein are officers, directors and/or stockholders of the
Company.
The Investor has approached the Company and the
Sellers with a proposal to take control of the Company’s
Board of Directors and use his best efforts to introduce the
Company to suitable targets for a Business Combination, and, in
consideration therefor, to obtain the right to purchase the
Warrants.
The Company’s Board of Directors has
determined that the Investor offers the Company the best chance to
consummate a Business Combination and that it is in the best
interests of the Company’s stockholders to enter into this
Agreement.
Pursuant to this Agreement, the Sellers will
have the option to sell to the Investor and the Investor will have
the option to purchase from the Sellers all of the Warrants upon
the earlier of (i) the Company’s consummation of a Business
Combination, (ii) the Company’s liquidation of its trust
account (the “ Trust Account ”) and (iii)
December 31, 2009, all upon the terms and subject to the conditions
set forth in this Agreement.
As a condition to this Agreement, and in
consideration of the Investor’s efforts in assisting the
Company to consummate a Business Combination, upon consummation of
a Business Combination, the Sellers shall transfer, for no
additional consideration, an aggregate of 1,488,250 shares of
Common Stock to the Investor.
AGREEMENT
For good and valuable consideration, the receipt
and sufficiency of which is hereby acknowledged, the parties agree
as follows:
ARTICLE 1
DEFINITIONS
The following terms, as used herein, have the
following meanings:
“ 1933 Act ” means the
Securities Act of 1933, as amended.
“ 1934 Act ” means the
Securities Exchange Act of 1934, as amended.
“ Affiliate ” means any
Person that, directly or indirectly through one or more
intermediaries, controls or is controlled by or is under common
control with a Person, as such terms are used in the 1933 Act and
the rules and regulations promulgated thereunder.
“ Business Combination ” has
the meaning set forth in the Preamble.
“ Business Day ” means any
day other than a Saturday, Sunday or legal or bank holiday in the
City of New York, State of New York. If any time period
set forth in this Agreement expires on other than a Business Day,
such period shall be extended to and through the next succeeding
Business Day.
“ Call Option ” has the
meaning set forth in Section 2.1.2 .
“ Claim ” has the meaning set
forth in Section 8.16 .
“ Closing ” has the meaning
set forth in Section 2.1.3 .
“ Common Stock ” has the
meaning set forth in the Preamble.
“ Company SEC Documents ”
means all documents, as such documents may have been amended (and,
if amended, only the most recent form of such document shall be
deemed to be one of the “Company SEC Documents”), filed
by the Company with the SEC under either the 1933 Act or the 1934
Act since its formation.
“ Graubard Miller ” means
Graubard Miller, counsel to the Company and the Sellers.
“ Indemnified Damages ” has
the meaning set forth in Section 6.1 .
“ Investor ” has the meaning
set forth in the Preamble.
“ Lien ” means, with respect
to any property or asset, any mortgage, lien, pledge, charge,
security interest, encumbrance or other adverse claim of any kind
in respect of such property or asset, other than (i) Liens created
by the Investor and (ii) restrictions on transfer pursuant to
securities laws, the Stock Escrow Agreement or the Subscription
Agreement. For purposes of this Agreement, a Person
shall be deemed to own subject to a Lien, any property or asset
that it has acquired or holds subject to the interest of a vendor
or lessor under any conditional sale agreement, capital lease or
other title retention agreement relating to such property or
asset.
“ Mintz Levin ” means Mintz,
Levin, Cohn, Ferris, Glovsky and Popeo, P.C., counsel to the
Investor.
“ Option ” has the meaning
set forth in Section 2.1.2 .
“ Option Trigger ” means the
earlier of (i) the Company’s consummation of a Business
Combination, (ii) the Company’s liquidation of the Trust
Account and (iii) December 31, 2009.
“ Person ” means an
individual, corporation, partnership, limited liability company,
association, trust or other entity or organization, including a
government or political subdivision or an agency or instrumentality
thereof.
“ Purchase Price ” has the
meaning set forth in Section 3.1 .
“ Put/Call Escrow Agent ” has
the meaning set forth in Section 2.1.4 .
“ Put/Call Escrow Agreement ”
has the meaning set forth in Section 2.1.4
“ Put Option ” has the
meaning set forth in Section 2.1.1 .
“ SEC ” means the Securities
and Exchange Commission.
“ Seller ” and “
Sellers ” has the meaning set forth in the
Preamble.
“ Several Provisions ” has
the meaning set forth in the preamble to Article 4.
“ Share Escrow Agent ” means
Continental Stock Transfer and Trust Company.
“ Stock Escrow Agreement ”
means that certain Stock Escrow Agreement dated November 30, 2007
by and among the Sellers, the Company and Continental Stock
Transfer & Trust Company.
“ Subscription Agreement ” is
the agreement executed by each Seller in connection with the
purchase of his Warrants.
“ Transferred Shares ” has
the meaning set forth in Section 2.2 .
“ Trust Account ” has the
meaning set forth in the Preamble.
“ Warrants ” has the meaning
set forth in the Preamble.
Any reference in this Agreement to (i) a statute
shall be to such statute, as amended from time to time, and to the
rules and regulations promulgated thereunder and (ii) the word
“including” shall mean “including, without
limitation.”
ARTICLE 2
PUT AND CALL OPTIONS;
TRANSFERS
2.1.
Put and Call Options for Purchase and Sale of Warrants
.
2.1.1 Grant of Put
Option . The Investor hereby grants to the Sellers
an irrevocable option (the “ Put Option ”) to
require the Investor to purchase all, but not less than all, of the
Warrants at the Purchase Price, which Put Option may be exercised
by the Sellers only following the Option Trigger. The
Put Option shall be terminated and be of no further force or effect
in the event that Sellers are in breach or default of the
representations and warranties contained in Section 4.6 of
this Agreement.
2.1.2 Grant of Call
Option . Sellers, jointly and severally, hereby
grant to the Investor an irrevocable option (the “ Call
Option ”; the Call Option and the Put Option shall
sometimes be referred to herein as an “ Option
”) to purchase at any time following the Option Trigger, all,
but not less than all, of the Warrants at the Purchase
Price.
2.1.3 Exercise of
Option . The Investor or the Sellers, as applicable, may
exercise an Option following the Option Trigger by delivering
written notice of exercise to the Sellers or the Investor, as
applicable, and, in either case, to the Put/Call Escrow
Agent. Sellers’ written notice of exercise of
their Put Option may be executed only by either Gordon or Klee, and
all Sellers will be bound by such executed notice. The
closing of the purchase and sale of the Warrants pursuant to such
an exercise of an Option (the “ Closing ”) will
occur within two (2) business days following the delivery of such
notice of exercise. At the Closing, (i) the Put/Call Escrow Agent
will deliver to the Investor the certificates representing the
Warrants being purchased by the Investor, which shall be
transferred by the Sellers free and clear of all Liens, together
with the warrant powers related thereto referenced below in
Section 3.2.1 and (ii) the Put/Call Escrow Agent will
deliver the Purchase Price to the Sellers. The payment shall be
made by immediately available funds transferred to a bank account
designated by the Sellers to the Put/Call Escrow Agent prior to
Closing. Upon receipt of the Purchase Price, the Sellers
hereby acknowledge that they will have no further interest in the
Warrants.
2.1.4 Put/Call Escrow .
On the date of this Agreement, (i) the Investor shall deposit the
Purchase Price by wire transfer into an interest-bearing escrow
account maintained by Graubard Miller (“ Put/Call Escrow
Agent ”); and (ii) the Sellers shall deposit the Warrants
and the warrant powers with the Put/Call Escrow
Agent. The Purchase Price, Warrants and warrant powers
shall be held in escrow by the Put/Call Escrow Agent until the
exercise of an Option, pursuant to an escrow agreement dated the
date hereof (“ Put/Call Escrow Agreement
”).
2.2.
Transfer of Shares . Upon consummation of a
Business Combination, Sellers shall transfer an aggregate of
1,488,250 of the Shares (such Shares referred to herein as the
“ Transferred Shares ”) to the Investor, in the
amount set forth next to such Seller’s name as set forth on
Schedule 2.2 attached hereto, which Transferred Shares shall
continue to be held in escrow pursuant to the Stock Escrow
Agreement. Sellers have delivered duly executed stock
powers and a notice to the Share Escrow Agent evidencing the
agreement of the Sellers set forth herein. The Sellers
will receive no cash consideration for the transfer of the
Transferred Shares to the Investor.
ARTICLE 3
PURCHASE PRICE;
DELIVERIES
3.1.
Purchase Price . The consideration to be paid by
the Investor to the Sellers for the Warrants pursuant to the
exercise of an Option shall be an aggregate purchase price of
$1,000,000 (the “ Purchase Price ”), to be paid
after the exercise of an Option to each Seller in the amounts as
set forth on Schedule 3.1 .
3.2.
Deliveries by Sellers, Investor and Company . The Sellers,
the Investor or the Company, as the case may be, shall deliver on
the date hereof:
3.2.1 Warrants
and duly executed warrant powers with respect to the Warrants,
which shall be held in escrow by the Put/Call Escrow Agent until
their release upon the exercise of an Option;
3.2.2 Amendments
to the insider letters previously executed by each Seller, in the
forms attached hereto as Exhibits A-1 through A-2
.
3.2.3 An
executed letter agreement addressed to the Share Escrow Agent, in
the form attached hereto as Exhibit B , with respect to the
transfer of the Transferred Shares upon the consummation of a
Business Combination, along with appropriate stock powers to
effectuate same;
3.2.4 Resignations
of (i) Gordon as an officer and director, (ii) Klee and Loewenstein
as officers and (iii) Sroka as a director;
3.2.5 Insider
letters, in the forms attached hereto as Exhibits C-1
through C-3 , for each of the Investor, Byong-Yub Ahn
(“ Ahn ”) and Yo-Shin Song (“ Song
”) (which shall include Trust Account indemnity provisions
and, with respect to the Investor, an acknowledgement by the
Investor to become a party to the Stock Escrow Agreement with
respect to his Transferred Shares);
3.2.6 A
notice to the Company from the Sellers, in the form attached hereto
as Exhibit D , with respect to the assignment of
Sellers’ registration rights with respect to the Warrants,
the shares of Common Stock underlying the Warrants and the
Transferred Shares;
3.2.7 An
executed letter agreement, in the form attached hereto as
Exhibit E , terminating the Company’s use of office
space, administrative, technology and secretarial services, at 175
Great Neck Road, Suite 204, Great Neck, New York;
3.2.8 Irrevocable
proxies with respect to voting of the Shares at a meeting of
stockholders;
3.2.9 A
certificate, signed by Gordon, Klee and the Chief Executive Officer
of the Company, that (i) the Company has extinguished any and all
liabilities, including the prepayment of certain insurance and tax
obligations, except for the prepaid assets and the liabilities set
forth on Schedule 3.2 attached hereto and such other
liabilities known to the signatories that would not, when paid,
reduce the Company’s out of trust cash balance below $0, and
(ii) the Company has not executed any definitive agreements,
letters of intent or any other agreement or understanding with
respect to any Business Combination that has not been abandoned
prior to the date hereof;
3.2.10 A
certificate, signed by the Chief Executive Officer of the Company,
attaching resolutions adopted by the remaining directors following
the resignations described in Section 3.2.4 hereto that (i)
elect (a) the Investor as a Class C director and Chairman of the
Board, (b) elect Ahn as a Class C director, and (c) elect Song as a
Class B director of the Company to fill the vacancies created by
such resignations, (ii) reclassify Klee as a Class A director,
(iii) appoint Ahn as Chief Executive Officer and President, and
Song as Chief Financial Officer of the Company, respectively, and
(iv) ratify the issuance of an additional 300,000 Warrants pursuant
to the Subscription Agreements,;
3.2.11 An
opinion of Graubard Miller in form and substance reasonably
acceptable to the Investor and an opinion of Mintz Levin in form
and substance reasonably acceptable to the Company;
3.2.12 The
Put/Call Escrow Agreement; and
3.2.13 Such
other certificates, instruments and documents of transfer, if any,
as may be necessary to consummate the transactions contemplated by
this Agreement.
ARTICLE 4
REPRESENTATIONS AND WARRANTIES OF
SELLERS
Each of the Sellers, severally and jointly
(except for Sections 4.1 , 4.4(b) , 4.5(b) ,
4.6 , 4.10(b) and 4.15(b) (“ Several
Provisions ”), which shall be made only severally), makes
the representations and warranties contained in this Article 4 to
the Investor, intending that the Investor relies on each of such
representations and warranties in order to induce the Investor to
enter into and complete the transactions contemplated by this
Agreement.
4.1.
Authorization of Sellers . The execution, delivery and
performance by each Seller of this Agreement and the consummation
by each Seller of the transactions contemplated hereby are within
each Seller’s powers and have been duly authorized by all
necessary action on the part of such Seller. This Agreement
constitutes a valid and binding agreement of each Seller,
enforceable against each Seller in accordance with its
terms.
4.2.
Company Authorization . This Agreement is the valid and
binding obligation of the Company, enforceable in accordance with
its terms. The execution, delivery and performance of
this Agreement has been duly authorized by all necessary corporate
or other action of the Company. The issuance, sale and
delivery of the shares of Common Stock issuable upon exercise of
the Warrants have been duly authorized and reserved for issuance by
all necessary corporate action on the part of the
Company. The shares of Common Stock issuable upon
exercise of the Warrants, when issued, will be duly and validly
issued, fully paid and non-assessable.
4.3.
Corporate Existence and Power . The Company is a
corporation duly incorporated, validly existing and in good
standing under the laws of the State of Delaware and has all
corporate powers and all governmental licenses, authorizations,
permits, consents and approvals required to carry on its business
as now conducted. The Company is duly qualified to do
business as a foreign corporation and is in good standing in each
jurisdiction where such qualification is necessary.
4.4.
Governmental Authorization . The execution, delivery and
performance of this Agreement and the consummation of the
transactions contemplated hereby by (a) the Company and (b) each
Seller, require no action by or in respect of, or filing with, any
governmental body, agency, official or authority, domestic or
foreign, other than compliance with a
