Lakeshore Acquisition I Corp. (LAAA) Arranges Non-Redemption Agreement


Lakeshore Acquisition I Corp. (LAAA) Arranges Non-Redemption Agreement

Lakeshore Acquisition Corp. I (NASDAQ:LAAA) announced this morning that it has entered into a non-redemption agreement and amended its purchaser support agreement with initial shareholders in connection to its proposed merger with medical device company ProSomnus.

The SPAC entered into non-redemption agreements with certain institutional investors for an aggregate of 200,339 shares of the purchaser. These investors will also receive an aggregate of 172,368 additional shares from the purchaser. Altogether, there are 395,339 shares subject to non-redemption agreements and the investors will receive an aggregate of 340,085 additional shares of the purchaser.

Additionally, Lakeshore I and ProSomnus amended the restated purchaser support agreement with the initial shareholders of the purchaser. Pursuant to the agreement, the supporters agreed to automatically transfer an additional 12% of the founder shares to equity investors for no consideration.

As a result, the supporters will transfer up to an aggregate of 42% of the founder shares to equity investors. If the aggregate number of transferred founder shares is equal to or greater than 273,350 founder shares, the 20% threshold, then the purchaser will issue a full warrant to the supporters for each transferred founder share transferred above the threshold; provided that in no event the aggregate number of transferred founder shares will be greater than 574,035.

This new non-redemption agreement and amended purchaser agreement comes just a day before its shareholder vote and a day after the SPAC added $8.2 million in additional financing to its proposed merger. Alongside the PIPE addition, Lakeshore I also secured an agreement from an investor to not redeem 195,000 shares in exchange for receiving 167,717 additional new shares. Together with the existing $30 million PIPE, Lakeshore I will be able to cover the deal’s $40 million minimum cash condition even with all other public shares redeemed.

The parties initially announced the $168 million combination on May 10. Pleasanton, California-based ProSomnus customizes oral appliance therapy devices to treat obstructive sleep apnea.