PUT AND CALL AGREEMENT
THIS PUT
AND CALL AGREEMENT dated as of April 8, 2009 (this “Agreement”) and entered into
by and between Spring Creek Acquisition Corp., a Cayman Islands company (“Spring
Creek” or the “Company”), AutoChina Group, Inc. (“AutoChina”), and the
signatories on the execution page hereof (collectively, the
“Seller”).
WHEREAS,
the Company was organized for the purpose of acquiring, through a stock
exchange, asset acquisition or other similar business combination, or
controlling, through contractual arrangements, an operating business, that has
its principal operations in the Greater China region, which includes Hong Kong,
Macau and Taiwan;
WHEREAS,
Spring Creek has agreed to acquire (the “Acquisition”) AutoChina pursuant to
certain agreements.
WHEREAS,
the approval of the Acquisition is contingent upon, among other things, the
affirmative vote of holders of a majority of the outstanding ordinary shares of
Spring Creek voting at the meeting to approve the Acquisition.
WHEREAS,
pursuant to certain provisions in Spring Creek’s amended and restated memorandum
and articles of association, a holder of ordinary shares of Spring Creek issued
in the IPO may, if such holder votes against the Acquisition, demand that Spring
Creek convert such ordinary shares into cash (“Conversion Rights”).
WHEREAS,
the Acquisition is subject to the exercise of Conversion Rights by holders of
less than 40% of the Spring Creek ordinary shares issued in the
IPO.
WHEREAS,
simultaneously with the entering into of this Agreement, Seller is purchasing an
aggregate of 548,800 ordinary shares (the “Shares”) of Spring Creek at a
purchase price of approximately $7.865 per Share.
WHEREAS,
Seller is interested in acquiring the right to require the Company to purchase
the Shares, and the Company is interested in acquiring the right to require the
Seller to sell the Shares, in each case during the time periods and upon the
terms and conditions described herein.
NOW,
THEREFORE, for and in consideration of the premises and the mutual covenants
hereinafter set forth, the parties hereto do hereby agree as
follows:
1.
|
Defined
Terms.
|
1.1.
|
“Escrow
Account” means the escrow account established by the parties hereto to
hold funds to secure the payment of the Option Price as set forth
herein.
|
1.2.
|
“Escrow
Agent” means the firm of Loeb & Loeb LLP, acting as escrow agent under
for the Escrow Account.
|
1.3.
|
“Market
Price” means the closing price of the Company’s ordinary shares as of the
immediately preceding trading day as quoted on the OTC Bulleting Board (or
any successor market, or the New York Stock Exchange, the NYSE Alternext,
the NASDAQ Global Select Market, the NASDAQ Global Market or the NASDAQ
Capital Market on which the Company’s ordinary shares are listed or quoted
for trading on the date in
question).
|
1.4.
|
“Option
Fee” means $0.105 per Share.
|
1.5.
|
“Option
Price” means $8.400 per Share, less the per Share portion of any cash
dividend or other cash distribution paid to the Company’s shareholders
prior to the exercise of the Put Option of Call
Option.
|
2.
|
Put
Option. In consideration of the grant of the Call Option
(defined below), the Company hereby grants Seller the option to require
the Company to buy from Seller any or all of the Shares owned by Seller at
the Option Price during the two week period commencing on the six month
anniversary of the date of this Agreement (the “Put
Option”). In order to exercise the Put Option, Seller shall
deliver to the Company a put option notice in the form of Schedule I
hereto. A put option notice may be delivered to the Company
prior to the six-month anniversary of the date of this Agreement, provided
that the closing date of the put option may not be prior to the six month
anniversary of the of the date of this
Agreement.
|
3.
|
Call
Option.
|
3.1.
|
In
consideration of the payment of the Option Fee and the grant of the Put
Option, Seller hereby grants the Company, or its assigns, the option to
require the Seller to sell to the Company, or its assignees, any or all of
the Shares owned by Seller at the Option Price until the last date on
which the Put Option may be exercised in accordance with Section 2 (the
“Call Option”); provided, however, that
the Company may not exercise the Call Option if the Market Price of the
Company’s ordinary shares on the applicable date exceeds the Option Price
unless such exercise is approved by the Seller. The Company may
assign, in whole or in part, the Call Option at any time prior to its
expiration, and the assignment or exercise of the Call Option with respect
to any Shares shall not limit the Company’s rights under the Call Option
with respect to any remaining Shares nor relieve the Company of its
obligations pursuant to the Call Option. In order to exercise
the Call Option, the Company, or its assigns, shall deliver to Seller a
call option notice in the form of Schedule II
hereto.
|
4.
|
Funds.
|
4.1.
|
Upon
the closing of the Acquisition, Seller will own 548,800 ordinary shares of
Spring Creek and Spring Creek shall transfer the Option Fee for each of
the Shares (an aggregate of $57,624) to the
Seller.
|
5.
|
Completion.
|
5.1.
|
If
either the Put Option or Call Option is exercised, a closing shall be held
on the Closing Date specified in the relevant notice (provided that with
respect to the Put Option the Closing Date shall be no earlier than a date
that is two weeks after the date that the Company receives such notice) at
the offices of the Company’s counsel, Loeb & Loeb LLP, 000 Xxxx
Xxxxxx, Xxx Xxxx, XX 00000 at which Seller will deliver certificates
representing such Shares as shall have been specified in the relevant
notice (or shall have delivered such Shares through the book-entry
facilities of DTC at the election of the Seller) and the Company, or its
assigns, will direct the Escrow Agent to release from the Escrow Account,
or in the event the Call Option has been assigned, such assignee shall
pay, funds equal to the Option Price per Share to an account of Seller
furnished to the Company and its assigns, as applicable, at least five
business days prior to such closing. In the event the Put
Option is exercised with respect to any of the Shares, the Company, or its
assigns, may exercise the Call Option and in lieu of closing on the Put
Option may close on the Call Option with respect to such Shares; provided, however, that
the Closing Date of such exercise of the Call Option shall be no later
than the Closing Date specified in the relevant put option
notice. The exercise, in whole or in part, of the Call Option
shall reduce the number of Shares subject to the Put Option on a
one-for-one basis, and (subject to the immediately preceding sentence) the
exercise, in whole or in part, of the Put Option shall reduce the number
of Shares subject to the Call Option on a one-for-one
basis.
|
5.2.
|
If
neither the Put Option nor the Call Option is exercised with respect to
any of the Shares prior to the expiration of such options, then Seller
shall promptly return to Spring Creek the Option Fee multiplied by the
number of Shares for which neither the Put Option nor the Call Option was
exercised.
|
6.
|
Representations and
Warranties of the Company and
Seller.
|
6.1.
|
The
Company hereby represents and warrants to the Seller as of the date hereof
and as of the Closing Date, as follows: (i) it is free to enter into this
Agreement; (ii) in so doing, it will not violate any other agreement to
which it is a party; (iii) it has taken all corporate action necessary to
authorize the execution and delivery of this Agreement and the performance
of its obligations under this Agreement; (iv) all amounts required to pay
the Option Price will be delivered to the Escrow Agent on the closing of
the Acquisition, (v) the Company is in good standing in its jurisdiction
of formation, and (vi) this Agreement is the valid and binding obligation
of the Company and AutoChina, enforceable against the Company and
AutoChina, respectively, in accordance with its terms. The Company hereby
represents and warrants to the Seller that as of the Closing Date all
necessary filings with the Securities and Exchange Commission related to
this Agreement shall have been made and that such filings will comply in
all material respects with the securities laws of the United
States.
|
6.2.
|
Seller
hereby represents and warrants to the Company as of the date hereof and as
of the Closing Date, as follows: (a) immediately prior to the closing of
each sale pursuant to this Agreement, Seller or its applicable designees
will have all rights, title and interest in and to the Shares being sold,
(b) any Shares sold by Seller and its designees under this Agreement will
be owned by Seller or its applicable designee free and clear of all liens
and encumbrances, and upon receipt of such Shares the purchaser of such
Shares will have all rights, title and interest in and to such shares, (c)
it is free to enter into this Agreement; (d) in so doing, it will not
violate any other agreement to which it is a party; and (e) it has taken
all corporate action necessary to authorize the execution and delivery of
this Agreement and the performance of its obligations under this
Agreement
|
7.
|
Escrow
Account. Spring Creek hereby agrees to place
$4,609,920.00 (the “Escrowed Funds”) in the Escrow Account maintained by
the Escrow Agent pursuant to the terms of an escrow agreement to be
executed by the parties and Loeb & Loeb LLP. The escrow
agreement provides that $8.400 of the Escrowed Funds will be released to
the Seller by the Escrow Agent for each Share subject to the Put Option
upon notice to the Escrow Agent that the Company has not fulfilled its
obligations under this Agreement to buy such Shares upon the appropriate
exercise by the Seller of its rights under this
Agreement.
|
8.
|
If the Acquisition is
not Consummated. Notwithstanding anything else herein to
the contrary, if the Acquisition is not consummated by April 17,
2009:
|
|
·
|
The
Company hereby agrees that it will use its best efforts to (i) cause its
shareholders to vote in favor of liquidating and dissolving the Company
and (ii) liquidate and dissolve the Company by the six month anniversary
of this Agreement.
|
|
·
|
Xxx
Sha, who is signatory to this Agreement for purposes of agreeing to this
Section 8, hereby agrees to pay the Seller $0.105 per Share for each month
after the first month (pro-rated for portions of a month), subject to a
minimum of $0.210 per Share, that the Seller holds the
Shares.
|
|
·
|
Beginning
on the three month anniversary of the date of this Agreement, use its best
efforts to obtain waivers from each person who is owed money by the
Company or has provided goods or services to the Company for which such
persons have not been paid.
|
9.
|
Indemnification.
The Company and AutoChina hereby agrees to indemnify and hold harmless
Seller and each of its partners, principals, members, officers, directors,
employees, agents, representatives and affiliated or managed funds (the
“Indemnified Parties”) from and against any and all losses, claims,
damages, liabilities and expenses, joint or several, of any kind or nature
whatsoever, and any and all actions, inquiries, proceedings and
investigations in respect thereof, whether pending or threatened, to which
any such party may become subject, arising in any manner out of or in
connection with this Agreement or the transactions contemplated herein to
the fullest extent permitted under applicable law, regardless of whether
any of such parties is a party hereto, and immediately upon request
reimburse such party for such party’s legal and other expenses as they are
incurred in connection with investigating, preparing, defending, paying,
settling or compromising any such action, inquiry, proceeding or
investigation (including, without limitation, usual and customary per diem
compensation for any such party’s involvement in discovery proceedings or
testimony); provided that
the Company and AutoChina shall not be liable for any such loss,
liability, claim, damage or expense resulting from actions taken by the
Indemnified Parties in bad faith or as a result of their respective gross
negligence or willful misconduct; and provided further that
such foregoing indemnity pursuant to this Section 9 shall not be available
for any losses, claims, damages, liabilities or expenses or with respect
to any lawsuits, inquiries, proceedings and investigations in respect
thereof to the extent such arise out of any actions taken after the
Closing.
|
10.
|
Notice. Any
notice required or permitted to be given or delivered hereunder or by
reason of the provisions of this Agreement shall be in writing and shall
be deemed to have been properly served if: (a) delivered personally, (b)
delivered by a recognized overnight courier service instructed to provide
next-day delivery, (c) sent by certified or registered mail, return
receipt requested and first class postage prepaid, or (d) sent by
facsimile transmission followed by confirmation copy delivered by a
recognized overnight courier service the next day. Such
notices, demands and other communications shall be sent to the addresses
set forth below, or to such other addresses or to the attention of such
other Person as the recipient has specified by prior written notice to the
sender. Date of service of such notice shall be: (i) the date
such notice is personally delivered or sent by facsimile transmission
(with issuance by the transmitting machine of confirmation of successful
transmission), (ii) three days after the date of mailing if sent by
certified or registered mail, or (iii) one day after date of delivery to
the overnight courier if sent by overnight courier. Unless
otherwise specified in writing, the mailing addresses of the parties
hereto shall be as follows:
|
If to the
Company or AutoChina, addressed to:
Spring
Creek Acquisition Corp.
Attention:
Yong Xxx Xx
Xx.000,
Xxxxxxxxx Xxxx Xxxx
Xxxxxxxxxxxx,
Xxxxx
People’s
Republic of China
Fax: x00
000 0000 0000
With a
copy to (which copy shall not constitute notice):
Loeb
& Loeb LLP
000 Xxxx
Xxxxxx
Xxx Xxxx,
Xxx Xxxx 00000
Attention: Xxxxxxxx
X. Xxxxxxxx, Esq.
Facsimile: 000-000-0000
If to
Seller, addressed to:
Victory
Park Capital Advisers , LLC
000 Xxxx
Xxxxxx Xxxxxx
Xxxxx
0000
Xxxxxxx,
Xxxxxxxx 00000
11.
|
Counterparts;
Facsimile Execution. This Agreement may be executed in
one or more counterparts, all of which shall be considered one and the
same agreement and shall become effective when one or more counterparts
have been signed by each of the parties and delivered to the other
party. Facsimile or other electronic execution and delivery of
this Agreement is legal, valid and binding for all
purposes.
|
12.
|
Entire Agreement;
Third Party Beneficiaries. This Agreement, taken
together with all Exhibits, Schedules and Annexes hereto (a) constitutes
the entire agreement, and supersedes all prior agreements and
understandings, both written and oral, among the parties with respect to
the matters contemplated hereby and (b) is not intended to confer upon any
person other than the parties any rights or
remedies.
|
13.
|
Governing
Law. In accordance with Section 5-1401 of the General
Obligations Law of the State of New York, this Agreement shall be governed
by, and construed in accordance with, the laws of the State of New York
without regard to principles of conflicts of laws that would result in the
application of the substantive law of another jurisdiction. The
parties hereto agree that any action, proceeding or claim arising out of
or relating in any way to this Agreement shall be resolved through final
and biding arbitration conducted in the City of New York, State of New
York in accordance with the rules and regulations of the American
Arbitration Association (AAA), by a panel of three arbitrators selected
from the AAA Commercial Disputes Panel instead of any jury trial and that
the arbitrator panel’s decision shall be final and binding to the fullest
extent permitted by law and enforceable by any court having jurisdiction
thereof. The cost of such arbitrator and arbitration services,
together with the prevailing party’s legal fees and expenses, shall be
borne by the non-prevailing party or as otherwise directed by the
arbitrators. The Company and AutoChina each hereby appoints,
without power of revocation, Loeb & Loeb, LLP, New York, New York,
Attn: Xxxxxxxx Xxxxxxxx, as their respective agent to accept and
acknowledge on its behalf service of any and all process which may be
served in any action, proceeding or counterclaim in any way relating to or
arising out of this Agreement.
|
14.
|
Assignment. Except
as set forth in Section 3 hereof, neither this Agreement nor any of the
rights, interests or obligations under this Agreement shall be assigned,
in whole or in part, by operation of law or otherwise by any of the
parties without the prior written consent of the other
party. Any purported assignment without such consent shall be
void. Subject to the preceding sentences, this Agreement will
be binding upon, inure to the benefit of, and be enforceable by, the
parties and their respective successors and
assigns.
|
[remainder
of page left intentionally blank; signature page follows]
IN
WITNESS WHEREOF, the Parties hereto have caused this Agreement to be duly
executed by their respective authorized signatories as of the date first
indicated above.
SPRING
CREEK ACQUISITION CORP.
|
|
By:
|
/s/ Xxxxx Sha
|
Name:
Xxxxx Sha
|
|
Title: Chief
Executive Officer
|
|
AUTOCHINA
GROUP, INC.
|
|
By:
|
/s/ Yong Xxx Xx
|
Name:
Yong Xxx Xx
|
|
Title: President
|
|
VICTORY
PARK SPECIAL SITUATIONS
MASTER
FUND, LTD.
|
|
By: Victory
Park Capital Advisors, LLC
|
|
Its: Investment
Manager
|
|
By:
|
/s/ Xxxxx X. Xxxxxxx
|
Name: Xxxxx
X. Xxxxxxx
|
|
Title: General
Counsel
|
|
VICTORY
PARK CREDIT
OPPORTUNITIES
MASTER FUND, LTD.
|
|
By: Victory
Park Capital Advisors, LLC
|
|
Its: Investment
Manager
|
|
By:
|
/s/ Xxxxx X. Xxxxxxx
|
Name: Xxxxx
X. Xxxxxxx
|
|
Title: General
Counsel
|
For
purposes of Section 8, only:
/s/ Xxxxx Sha
|
|
Xxxxx
Sha
|
SCHEDULE
I
PUT
OPTION NOTICE
To:
[COMPANY]
Attention:
[•]
[Date]
Ladies
and Gentlemen,
Put
Option Notice
We refer
to the Put and Call Agreement (the “Put and Call Agreement”) dated
April ___, 2009 and made between you and the undersigned. Terms defined in the
Put and Call Agreement shall bear the same meaning when used
herein.
We hereby
confirm that we wish to exercise the option granted under Section 2 of the Put
and Call Agreement and accordingly the Put Option is hereby exercised with
respect to ________ Shares.
The
Closing Date shall be [•][date must be at least two weeks after the date the
Company receives the Put Option Notice].
This put
option notice is irrevocable and is governed by, and shall be construed in
accordance with the laws of the State of New York.
Yours
faithfully
|
|
By:
|
|
Name:
|
|
Title:
|
SCHEDULE
II
CALL
OPTION NOTICE
To:
[SELLER]
Attention:
[•]
[Date]
Ladies
and Gentlemen,
Call
Option Notice
We refer
to the Put and Call Agreement (the “Put and Call Agreement”) dated
April ___, 2009 and made between you and the undersigned. Terms defined in the
Put and Call Agreement shall bear the same meaning when used
herein.
We hereby
confirm that we wish to exercise the option granted under Section 3.1 of the Put
and Call Agreement and accordingly the Call Option is hereby exercised with
respect to ________ Shares.
The
Closing Date shall be [•].
This call
option notice is irrevocable and is governed by, and shall be construed in
accordance with the laws of the State of New York.
Yours
faithfully
|
|
By:
|
|
Name:
|
|
Title:
|