Exhibit 10.1


 


January
14, 2021


 


26
Capital Acquisition Corp.


701
Brickell Avenue, Suite 1550


Miami,
FL 33131





	Re:	Initial
    Public Offering


 


Ladies
and Gentlemen:


 


This
letter (this “Letter Agreement”) is being delivered to you in accordance with the
Underwriting Agreement (the “Underwriting Agreement”) entered into by and between 26 Capital
Acquisition Corp., a Delaware corporation (the “Company”), and Cantor Fitzgerald & Co., as representative
(the “Representative”) of the several underwriters (each, an “Underwriter”
and collectively, the “Underwriters”), relating to an underwritten initial public offering (the “Public Offering”),
27,600,000 of the Company's units (up to 3,600,000 units that may be purchased to cover over-allotments, if any) (the “Units”),
each comprised of one share of the Company’s Class A common stock, par value $0.0001 per share (the “Common Stock”),
and one-half of one redeemable warrant. Each whole warrant (each, a “Warrant”) entitles the holder thereof
to purchase one share of Common Stock at a price of $11.50 per share, subject to adjustment. The Units will be sold in the Public
Offering pursuant to registration statements on Form S-1 (File Nos. 333-251682 and 252111) and prospectus (the "Prospectus")
filed by the Company with the U.S. Securities and Exchange Commission (the "Commission") and the Company has applied
to have the Units listed on The Nasdaq Capital Market. Certain capitalized terms used herein are defined in paragraph 12 hereof.


 


In
order to induce the Company and the Underwriters to enter into the Underwriting Agreement and to proceed with the Public Offering
and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, each
of 26 Capital Holdings LLC (the “Sponsor”) and the undersigned individuals, each of whom is a member
of the Company’s board of directors and/or management team of the Company (each, an “Insider”
and collectively, the “Insiders”), hereby agrees with the Company as follows:


 


1.
The Sponsor and each Insider agrees that if the Company seeks stockholder approval of a proposed Business Combination, then in
connection with such proposed Business Combination, it, he or she shall (i) vote any shares of Capital Stock owned by it, him
or her in favor of any proposed Business Combination and (ii) not redeem any shares of Common Stock owned by it, him or her in
connection with such stockholder approval. If the Company engages in a tender offer in connection with any proposed Business Combination,
the Sponsor and each Insider agrees that it, he or she will not seek to sell its, his or her shares of Capital Stock to the Company
in connection with such tender offer.


 


2.
The Sponsor and each Insider hereby agrees that in the event that the Company fails to consummate a Business Combination within
24 months from the closing of the Public Offering, or such later period approved by the Company’s stockholders in accordance
with the Company’s amended and restated certificate of incorporation (the “Charter”), the Sponsor
and each Insider shall take all reasonable steps to cause the Company to (i) cease all operations except for the purpose of winding
up, (ii) as promptly as reasonably possible but not more than 10 business days thereafter, subject to lawfully available funds
therefor, redeem 100% of the Common Stock sold as part of the Units in the Public Offering (the “Offering Shares”),
at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account (as defined below),
including interest earned on the funds held in the Trust Account and not previously released to the Company to pay its taxes (less
up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding Offering Shares, which redemption
will completely extinguish all Public Stockholders’ rights as stockholders (including the right to receive further liquidation
distributions, if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject
to the approval of the Company’s remaining stockholders and the Company’s board of directors, dissolve and liquidate,
subject in each case to the Company’s obligations under Delaware law to provide for claims of creditors and other requirements
of applicable law. The Sponsor and each Insider agrees not to propose any amendment to the Charter to modify (i) the substance
or timing of the ability of holders of Offering Shares to seek redemption in connection with a Business Combination, (ii) certain
amendments to the Charter prior to the completion of a Business Combination or (iii) (A) the Company obligation to redeem 100%
of the Offering Shares if the Company does not complete a Business Combination within such time set forth in the Charter or (B)
any other provisions relating to stockholders' rights or pre-initial Business Combination activity, unless the Company provides
its public stockholders with the opportunity to redeem their shares of Common Stock upon approval of any such amendment at a per-share
price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account, including interest earned on the funds
held in the Trust Account and not previously released to the Company to pay its taxes, divided by the number of then outstanding
Offering Shares. 


 




     


     


    

  


The
Sponsor and each Insider acknowledges that it, he or she has no right, title, interest or claim of any kind in or to any monies
held in the Trust Account or any other asset of the Company as a result of any liquidation of the Company with respect to the
Founder Shares held by it, him or her. The Sponsor and each Insider hereby further waives, with respect to any shares of Common
Stock held by it, him or her, if any, whether acquired now or hereafter, any redemption rights it, he or she may have in connection
with the consummation of a Business Combination, including, without limitation, any such rights available in the context of a
stockholder vote to approve such Business Combination or a stockholder vote to approve an amendment to the Charter to modify (i)
the substance or timing of the ability of holders of Offering Shares to seek redemption in connection with a Business Combination
or (ii) (A) the Company’s obligation to redeem 100% of the Offering Shares if the Company does not complete a Business Combination
within such time set forth in the Charter or (B) any other provisions relating to stockholders' rights or pre-initial Business
Combination activity, unless the Company provides its public stockholders with the opportunity to redeem their shares of Common
Stock upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit
in the Trust Account, including interest earned on the funds held in the Trust Account and not previously released to the Company
to pay its taxes, divided by the number of then outstanding Offering Shares, or (iii) in the context of a tender offer made by
the Company to purchase shares of Common Stock (although the Sponsor, the Insiders and their respective affiliates shall be entitled
to redemption and liquidation rights with respect to any Offering Shares it or they hold if the Company fails to consummate a
Business Combination within the time period set forth in the Charter).


 


3.
During the period commencing on the date of the Underwriting Agreement and ending 180 days after such date, the Sponsor and each
Insider shall not, without the prior written consent of the Representative, (i) sell, offer to sell, contract or agree to sell,
hypothecate, pledge, grant any option to purchase or otherwise dispose of or agree to dispose of, directly or indirectly, or establish
or increase a put equivalent position or liquidate or decrease a call equivalent position within the meaning of Section 16 of
the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and the rules and regulations
of the Commission promulgated thereunder, with respect to any Units, shares of Capital Stock, Warrants or any securities convertible
into, or exercisable, or exchangeable for, shares of Capital Stock owned by it, him or her, (ii) enter into any swap or other
arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of any Units, shares
of Capital Stock, Warrants or any securities convertible into, or exercisable, or exchangeable for, shares of Capital Stock owned
by it, him or her, whether any such transaction is to be settled by delivery of such securities, in cash or otherwise, or (iii)
publicly announce any intention to effect any transaction specified in clause (i) or (ii).


 


4.
In the event of the liquidation of the Trust Account upon the failure of the Company to consummate its initial Business Combination
within the time period set forth in the Charter, the Sponsor (the “Indemnitor”) agrees to indemnify
and hold harmless the Company against any and all loss, liability, claim, damage and expense whatsoever (including, but not limited
to, any and all legal or other expenses reasonably incurred in investigating, preparing or defending against any litigation, whether
pending or threatened) to which the Company may become subject as a result of any claim by (i) any third party for services rendered
or products sold to the Company or (ii) any prospective target business with which the Company has entered into a written letter
of intent, confidentiality or other similar agreement or Business Combination agreement (a “Target”); provided, however,
that such indemnification of the Company by the Indemnitor shall (x) apply only to the extent necessary to ensure that such claims
by a third party or a Target do not reduce the amount of funds in the Trust Account to below the lesser of (i) $10.00 per Offering
Share and (ii) the actual amount per Offering Share held in the Trust Account as of the date of the liquidation of the Trust Account,
if less than $10.00 per Offering Share is then held in the Trust Account due to reductions in the value of the trust assets, less
interest earned on the Trust Account which may be withdrawn to pay taxes, (y) not apply to any claims by a third party or a Target
which executed a waiver of any and all rights to the monies held in the Trust Account (whether or not such waiver is enforceable)
and (z) not apply to any claims under the Company’s indemnity of the Underwriters against certain liabilities, including
liabilities under the Securities Act of 1933, as amended. The Indemnitor shall have the right to defend against any such claim
with counsel of its choice reasonably satisfactory to the Company if, within 15 days following written receipt of notice of the
claim to the Indemnitor, the Indemnitor notifies the Company in writing that it shall undertake such defense.


 




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5.
To the extent that the Underwriters do not exercise their over-allotment option to purchase up to an additional 3,600,000 Units
in full within 45 days from the date of the Prospectus (and as further described in the Prospectus), the Sponsor agrees to forfeit,
at no cost, a number of Founder Shares in the aggregate equal to 750,000 multiplied by a fraction, (i) the numerator of which
is 3,600,000 minus the number of Units purchased by the Underwriters upon the exercise of their over-allotment option, and (ii)
the denominator of which is 3,600,000. The Sponsor will be required to forfeit only that number of Founder Shares as is necessary
so that the Initial Stockholders will own an aggregate of 20.0% of the Company's issued and outstanding shares of Capital Stock
after the Public Offering.


 


6.
(a) The Sponsor and each Insider hereby agrees and acknowledges that: (i) the Underwriters and the Company would be irreparably
injured in the event of a breach by such Sponsor or an Insider of its, his or her obligations under paragraphs 1, 2, 3, 4, 5,
7(a), 7(b), 9 and 10, as applicable, of this Letter Agreement (ii) monetary damages may not be an adequate remedy for such breach
and (iii) the non-breaching party shall be entitled to injunctive relief, in addition to any other remedy that such party may
have in law or in equity, in the event of such breach.


 


7.
(a) The Sponsor and each Insider agrees that it, he or she shall not Transfer any Founder Shares (or shares of Common Stock issuable
upon conversion thereof) until the earlier of (A) one year after the completion of the Company’s initial Business Combination
or (B) subsequent to the Business Combination, (x) if the last sale price of the Common Stock equals or exceeds $12.00 per share
(as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within
any 30-trading day period commencing at least 150 days after the Company’s initial Business Combination or (y) the date
on which the Company completes a liquidation, merger, capital stock exchange, reorganization or other similar transaction that
results in all of the Company’s stockholders having the right to exchange their shares of Common Stock for cash, securities
or other property (the “Founder Shares Lock-up Period”).


 


(b)
The Sponsor and each Insider agrees that it, he or she shall not Transfer any Private Placement Warrants (or shares of Common
Stock issued or issuable upon the exercise of the Private Placement Warrants), until 30 days after the completion of a Business
Combination (the “Private Placement Warrants Lock-up Period”,
together with the Founder Shares Lock-up Period, the “Lock-up Periods”).


 


(c)
Notwithstanding the provisions set forth in paragraphs 7(a) and (b), Transfers of the Founder Shares, Private Placement Warrants
and shares of Common Stock issued or issuable upon the exercise or conversion of the Private Placement Warrants or the Founder
Shares and that are held by the Sponsor, any Insider or any of their permitted transferees (that have complied with this paragraph
7(c)), are permitted (a) to the Company’s officers or directors, any affiliate or family member of any of the Company’s
officers or directors or any affiliate of the Sponsor or to any member(s) of the Sponsor or any of their affiliates; (b) in the
case of an individual, by gift to a member of such individual’s immediate family or to a trust, the beneficiary of which
is a member of such individual’s immediate family, an affiliate of such individual or to a charitable organization; (c)
in the case of an individual, by virtue of laws of descent and distribution upon death of such individual; (d) in the case of
an individual, pursuant to a qualified domestic relations order; (e) by private sales or transfers made in connection with the
consummation of an initial Business Combination at prices no greater than the price at which the shares or warrants were originally
purchased; (f) in the event of the Company’s liquidation prior to the completion of an initial Business Combination; or
(g) by virtue of the laws of the State of Delaware or the Sponsor’s limited liability company agreement upon dissolution
of the Sponsor; provided, however, that in each case these permitted transferees must enter into a written
agreement with the Company agreeing to be bound by the transfer restrictions herein.


 


8.
The Sponsor and each Insider represents and warrants that it, he or she 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. Each Insider’s biographical information furnished to the Company (including any such information included in
the Prospectus) is true and accurate in all respects and does not omit any material information with respect to the Insider’s
background. Each Insider’s questionnaire furnished to the Company is true and accurate in all respects. Each Insider represents
and warrants that: it, he or she is not subject to or a respondent in any legal action for, any injunction, cease-and-desist order
or order or stipulation to desist or refrain from any act or practice relating to the offering of securities in any jurisdiction;
it, he or she has never been convicted of, or pleaded guilty to, any crime (i) involving fraud, (ii) relating to any financial
transaction or handling of funds of another person, or (iii) pertaining to any dealings in any securities and it, he or she is
not currently a defendant in any such criminal proceeding.


 




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9.
Except as disclosed in the Prospectus, neither the Sponsor nor any officer, director, advisor or any affiliate of the Sponsor,
officer, director or advisor of the Company, shall receive from the Company any finder’s fee, reimbursement, consulting
fee, monies in respect of any repayment of a loan or other compensation prior to, or in connection with any services rendered
in order to effectuate, the consummation of the Company’s initial Business Combination (regardless of the type of transaction
that it is).


 


10.
Each Insider agrees that, until the consummation of the Business Combination and for one year thereafter, he or she will keep
confidential all confidential, proprietary and non-public information of the Company (whether written, oral or electronic communications),
including without limitation, the names of the targets identified by the Company for a potential Business Combination and any
and all information provided by the Company to the Insider regarding such targets.


 


11.
The Sponsor and each Insider has full right and power, without violating any agreement to which it is bound (including, without
limitation, any non-competition or non-solicitation agreement with any employer or former employer), to enter into this Letter
Agreement and, as applicable, to serve as an officer and/or director on the board of directors of the Company and hereby consents
to being named in the Prospectus as an officer and/or director of the Company.


 


12.
As used herein, (i) "Business Combination" shall mean a merger, capital stock exchange, asset acquisition, stock purchase,
reorganization or similar business combination, involving the Company and one or more businesses; (ii) "Capital Stock"
shall mean, collectively, the Common Stock and the Founder Shares; (iii) "Founder Shares" shall mean (a) the 5,750,000
shares of the Company's Class B common stock, par value $0.0001 per share, initially issued to the Sponsor (up to 750,000 Shares
of which are subject to complete or partial forfeiture by the Sponsor if the over-allotment option is not exercised by the Underwriters)
for an aggregate purchase price of $25,000, or $0.006 per share, prior to the consummation of the Public Offering; (iv) "Initial
Stockholders" shall mean the Sponsor and any Insider that holds Founder Shares; (v) "Private Placement Warrants"
shall mean the Warrants to purchase up to 6,000,000 (or up to 6,600,000 warrants if the over-allotment option is exercised in
full) shares of Common Stock of the Company that the Sponsor has agreed to purchase for an aggregate purchase price of $6,000,000
(or up to $6,600,000 warrants if the over-allotment option is exercised in full) in the aggregate, or $1.00 per Warrant, in a
private placement that shall occur simultaneously with the consummation of the Public Offering;


 


;
(vi) “Public Stockholders” shall mean the holders of securities issued in the Public
Offering; (vii) “Trust Account” shall mean the trust fund into which a portion of
the net proceeds of the Public Offering shall be deposited; and (viii) “Transfer” shall mean the (a)
sale of, offer to sell, contract or agreement to sell, hypothecate, pledge, grant of any option to purchase or otherwise dispose
of or agreement to dispose of, directly or indirectly, or establishment or increase of a put equivalent position or liquidation
with respect to or decrease of a call equivalent position within the meaning of Section 16 of the Exchange Act, and the rules
and regulations of the Commission promulgated thereunder with respect to, any security, (b) entry into any swap or other arrangement
that transfers to another, in whole or in part, any of the economic consequences of ownership of any security, whether any such
transaction is to be settled by delivery of such securities, in cash or otherwise, or (c) public announcement of any intention
to effect any transaction specified in clause (a) or (b).


  


13.
The Company will maintain an insurance policy or policies providing directors’ and officers’ liability insurance,
and each Director shall be covered by such policy or policies, in accordance with its or their terms, to the maximum extent of
the coverage available for any of the Company’s directors or officers.


 


14.
This Letter Agreement constitutes the entire agreement and understanding of the parties hereto in respect of the subject matter
hereof and supersedes 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 Letter 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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15.
No party hereto may assign either this Letter 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 Letter Agreement shall be binding
on the Sponsor and each Insider and their respective successors, heirs and assigns and permitted transferees.


 


16.
Nothing in this Letter Agreement shall be construed to confer upon, or give to, any person or corporation other than the parties
hereto any right, remedy or claim under or by reason of this Letter Agreement or of any covenant, condition, stipulation, promise
or agreement hereof. All covenants, conditions, stipulations, promises and agreements contained in this Letter Agreement shall
be for the sole and exclusive benefit of the parties hereto and their successors, heirs, personal representatives and assigns
and permitted transferees.


 


17.
This Letter Agreement may be executed in any number of original 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.


 


18.
This Letter 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 Letter 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
Letter Agreement a provision as similar in terms to such invalid or unenforceable provision as may be possible and be valid and
enforceable.


 


19.
This Letter Agreement shall be governed by and construed and enforced in accordance with the laws of the State of New York, without
giving effect to conflicts of law principles that would result in the application of the substantive laws of another jurisdiction.
The parties hereto (i) all agree that any action, proceeding, claim or dispute arising out of, or relating in any way to, this
Letter Agreement shall be brought and enforced in the courts of New York City, in the State of New York, and irrevocably submit
to such jurisdiction and venue, which jurisdiction and venue shall be exclusive and (ii) waive any objection to such exclusive
jurisdiction and venue or that such courts represent an inconvenient forum.


 


20.
Any notice, consent or request to be given in connection with any of the terms or provisions of this Letter Agreement shall be
in writing and shall be sent by express mail or similar private courier service, by certified mail (return receipt requested),
by hand delivery or facsimile transmission.


 


 21.
This Letter Agreement shall terminate on the earlier of (i) the expiration of the Lock-up Periods or (ii) the liquidation of the
Company; provided, however, that this Letter Agreement shall earlier terminate in the event that the Public Offering is not consummated
and closed by December 31, 2021; provided further that paragraphs 4 and 11 of this Letter Agreement shall survive such liquidation.


 


22.
The Company, the Sponsor and each Insider hereby acknowledges and agrees that the Representative on behalf of the Underwriters
is a third party beneficiary of this Letter Agreement.


  


[Signature
Page Follows]


 






    5


     


    

 


Sincerely,


 


	 	26
    CAPITAL HOLDINGS LLC
	 	 	 
	 	By:	/s/
    Jason Ader
	 	 	Name:
    Jason Ader
	 	 	Title: Managing
    Member


  


	 	By:	/s/
    Jason Ader
	 	 	Name:
    Jason Ader


  


	 	By:	/s/
    John Lewis
	 	 	Name:
    John Lewis


 


	 	By:	/s/
    Rafi Ashkenazi
	 	 	Name:
    Rafi Ashkenazi
	 	 	 
	 	By:	/s/
    Gregory S. Lyss
	 	 	Name:
    Gregory S. Lyss
	 	 	 
	 	By:	/s/
    Joseph Kaminkow
	 	 	Name:
    Joseph Kaminkow


 


	Acknowledged
    and Agreed:	 
	 	 
	26
    CAPITAL ACQUISITION CORP.	 
	 	 	 
	By:	/s/
    Jason Ader	 
	 	Name:
    Jason Ader	 
	 	Title: Chief
    Executive Officer	 


 


[Signature
Page to Letter Agreement]