Document:

Exhibit
10.26

 

THIRD
AMENDMENT AND WAIVER TO LOAN AND SECURITY AGREEMENT

 

This
THIRD AMENDMENT AND WAIVER TO LOAN AND SECURITY AGREEMENT (this “Third Amendment”) is made and entered
into as of March 13, 2020, by and between EAST WEST BANK, a Delaware corporation (“Bank”), and NEW
AGE BEVERAGES CORPORATION, a Washington corporation (“Borrower”).

 

WHEREAS,
Borrower and Bank are party to that certain Loan and Security Agreement, dated as of March 29, 2019, by and between Borrower,
as borrower, and Bank, as lender (as amended by that certain First Amendment, Waiver and Consent to Loan and Security Agreement,
dated as of July 11, 2019, that certain Second Amendment and Waiver to Loan and Security Agreement, dated as of October 9, 2019,
and as further amended, restated, amended and restated, supplemented or otherwise modified from time to time, the “Loan
Agreement”);

 

WHEREAS,
Borrower and Bank desire to (i) amend certain provisions of the Loan Agreement and (ii) waive any default or Event of Default
that has arisen or would otherwise arise under Section 8.2(a) of the Loan Agreement for Borrower and its Subsidiaries’ failure
to achieve, in accordance with Section 7.12(a) of the Loan Agreement, Adjusted EBITDA of at least $8,000,000 for the 12 month
period ending on December 31, 2019; and

 

WHEREAS,
pursuant to Section 9.6 of the Loan Agreement, a waiver under the Loan Agreement may be granted by Bank, and pursuant to Section
12.7 of the Loan Agreement, the Loan Agreement may be amended by an instrument in writing signed by Borrower and Bank.

 

NOW,
THEREFORE, in consideration of the mutual agreements herein contained, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

 

1.
Definitions; Loan Document. Capitalized terms used herein without definition shall have the meanings assigned to
such terms in the Loan Agreement. This Third Amendment shall constitute a Loan Document for all purposes of the Loan Agreement
and the other Loan Documents.

 

2.
Waiver. Bank hereby waives any non-compliance by Borrower with the covenant set forth in Section 7.12(a) of the
Loan Agreement as a result of its and its Subsidiaries’ failure to achieve Adjusted EBITDA of at least $8,000,000 for the
12 month period ending on December 31, 2019 and any default or Event of Default that may have occurred or would otherwise arise
under Section 8.2(a) of the Loan Agreement as a result thereof.

 

3.
Amendment to Section 2.3(c). Section 2.3(c) is hereby amended and restated in its entirety as follows:

 

“Amortization
Payments. Commencing on the seventh Payment Date following the Effective Date and continuing on each Payment Date thereafter,
Borrower shall make a payment towards the principal amount of the Term Loan Advance in an amount equal to $125,000; provided
that such payment amount shall be increased pursuant to the amount of any Incremental Term Loan Advances borrowed pursuant
to Section 2.11 so that the payment amount on any Payment Date shall be equal to (i) the Term Loan Amount (as such amount is increased
pursuant to Section 2.11) divided by (ii) 10 divided by (iii) 12. The Backend Fee, all outstanding principal and
accrued and unpaid interest under the Term Loan Advance, and all other outstanding Obligations with respect to the Term Loan Advance,
shall be due and payable in full on the Term Loan Maturity Date.”

 

    	 

    	 

    

 

4.
Amendment to Section 2.3(e). Section 2.3(e) is hereby amended and restated in its entirety as follows:

 

“Permitted
Prepayment. Borrower shall have the option to prepay the Term Loan Advance, in whole or in part, provided Borrower (i) delivers
written notice to Bank of its election to prepay the Term Loan Advance (or any part thereof) at least 10 Business Days prior to
such prepayment, and (ii) pays, on the date of such prepayment (A) the outstanding principal being prepaid plus all accrued and
unpaid interest with respect to the Term Loan Advance (or the part thereof being prepaid), (B) if the Term Loan Advance is being
prepaid in full, the Backend Fee and (C) all other sums, if any, that shall have become due and payable with respect to the Term
Loan Advance, including any Prepayment Fee then due and any interest at the Default Rate with respect to any past due amounts.”

 

5.
Amendment to Section 2.3(f). Section 2.3(f) is hereby amended and restated in its entirety as follows:

 

“Mandatory
Prepayment Upon an Acceleration. If the Term Loan Advance is accelerated by Bank following the occurrence and during the continuance
of an Event of Default, Borrower shall immediately pay to Bank an amount equal to the sum of (i) all outstanding principal plus
accrued and unpaid interest with respect to the Term Loan Advance, (ii) the Backend Fee and (iii) all other sums, if any, that
shall have become due and payable with respect to the Term Loan Advance, including any Prepayment Fee then due and any interest
at the Default Rate with respect to any past due amounts.”

 

6.
Amendment to Section 2.4. Section 2.4 is hereby amended by deleting the first sentence of the second paragraph thereof
and replacing it with the following:

 

“Bank
shall credit proceeds of the Term Loan Advance to the Designated Deposit Account and shall credit proceeds of any Advance to the
USD Revolver Restricted Cash Account.”

 

7.
Amendment to Section 2.7. Section 2.7 is hereby amended by deleting the “and” after clause (b), inserting
the following clause (c) and re-lettering the subsequent clauses:

 

“(c)
Backend Fee. The Backend Fee, when due hereunder; and”

 

    	-2-

    	 

    

 

8.
Amendment to Section 2.8. Section 2.8 is hereby amended by inserting new subsections (d) and (e) immediately after
subsection (c) as follows:

 

“(d)
Bank may debit the USD Restricted Cash Account for principal payments on the Term Loan Advance when due. These debits shall not
constitute a set-off.

 

(e)
Bank may debit the USD Revolver Restricted Cash Account on the first Business Day of each January, April, July and October for
principal payments on any Advances then outstanding. These debits shall not constitute a set-off.”

 

9.
Amendment to Section 6.2(a). Section 6.2(a) is hereby amended and restated in its entirety as follows:

 

“(a)
as soon as available, but in any event no later than 45 days after the last day of each calendar month, other than with respect
to the month of January, in which case no later than 65 days after the last day of January, a company prepared consolidated balance
sheet, income statement and cash flow statement covering Borrower’s and its Subsidiaries’ consolidated operations
for such month certified by a Responsible Officer and in a form acceptable to Bank (the “Monthly Financial Statements”);”

 

10.
Amendment to Section 6.3(a). Section 6.3(a) is hereby amended and restated in its entirety as follows:

 

“(a)
Collection of Accounts. Borrower shall, and shall cause each Guarantor to, direct Account Debtors to deliver or transmit
all proceeds of Accounts into a lockbox account, or such other “blocked account” or “blocked accounts”
as specified by Bank (any such accounts, individually and collectively, the “Cash Collateral Account”; for
the avoidance of doubt and without limiting the foregoing, the Cash Collateral Account shall include the Restricted Cash Accounts).
Whether or not an Event of Default has occurred and is continuing, Borrower shall immediately, and in any event no later than
one Business Day after its or any Guarantor’s receipt of such amounts, deliver all payments on and proceeds of Accounts
to the Cash Collateral Account.”

 

11.
Amendment to Section 6.3. Section 6.3 is hereby amended by inserting a new subsection (f) immediately after subsection
(d) as follows:

 

“(f)
Restricted Cash Accounts. On the Third Amendment Effective Date, Borrower shall deposit no less than (i) $7,375,000 in
the USD Restricted Cash Account and (ii) an amount in RMB equal (on the Third Amendment Effective Date) to $7,700,000 in the RMB
Restricted Cash Account.”

 

12.
Amendment to Section 7.6. Section 7.6 is hereby amended and restated in its entirety as follows:

 

“Maintenance
of Collateral Accounts. (a) Maintain any Collateral Account in the United States, or permit any Subsidiary to do so, except
pursuant to the terms of Section 6.8 hereof.

 

    	-3-

    	 

    

 

(b)
Suffer or permit the amount of cash in the USD Restricted Cash Account to be less than $7,375,000 (subject to reduction as set
forth in the proviso to this Section 7.6(b)) at any time; provided that, notwithstanding anything herein to the contrary,
the required balance of the USD Restricted Cash Account pursuant to this Section 7.6(b) shall be reduced on a dollar-for-dollar
basis with any payments of any principal amount of the Term Loan Advance paid to Bank from the USD Restricted Cash Account pursuant
to Section 2.8(d).

 

(c)
Suffer or permit the amount of cash in the RMB Restricted Cash Account to be less than the equivalent of $7,350,000 at any time
due to any fluctuation in currency exchange rates; provided that upon the balance in the RMB Restricted Cash Account falling
below the equivalent of $7,350,000, Borrower shall have three Business Days to deposit additional amounts into the RMB Restricted
Cash Account to cause the balance of the RMB Restricted Cash Account to be no less than the equivalent of $7,700,000.”

 

13.
Amendment to Section 7.12(a). Section 7.12(a) is hereby amended and restated in its entirety as follows:

 

“(a)
Minimum Adjusted EBITDA. Not suffer or permit the Adjusted EBITDA for Borrower and its Subsidiaries, for the three-month
period ending on the last day of any fiscal quarter, commencing with the fiscal quarter ending September 30, 2020, to be less
than the amount set forth in the table below opposite such date.”

 

	Date	 	Minimum Adjusted
 EBITDA
	 
	September 30, 2020	 	$	-4,000,000	 
	December 31, 2020	 	$	0	 
	March 31, 2021	 	$	0	 

 

14. Amendment
to Section 7.12(b). Section 7.12(b) is hereby deleted in its entirety and replaced with
“[Reserved].”.

 

    	-4-

    	 

    

 

15. Amendment
to Section 7.12(c). Section 7.12(c) is hereby amended and restated in its entirety as follows:

 

“(c)
Not suffer or permit the Total Leverage Ratio as of the last day of any fiscal quarter, commencing with the fiscal quarter
ending June 30, 2021, to be greater than the maximum ratio set forth in the table below opposite such date.”

 

	Date	 	Maximum Total Leverage Ratio
	June 30, 2021	 	2.50 to 1.00
	September 30, 2021	 	2.50 to 1.00
	December 31, 2021	 	2.00 to 1.00
	March 31, 2022	 	2.00 to 1.00
	June 30, 2022	 	2.00 to 1.00
	September 30, 2022	 	2.00 to 1.00
	December 31, 2022 and thereafter	 	1.50 to 1.00

 

16.
Amendment to Section 7.12(d). Section 7.12(d) is hereby amended and restated in its entirety as follows:

 

“(d)
Fixed Charge Coverage Ratio. Not suffer or permit the Fixed Charge Coverage Ratio as of the last day of any fiscal quarter,
commencing with the fiscal quarter ending June 30, 2021, to be less than 1.25 to 1.00.”

 

    	-5-

    	 

    

 

17.
Amendment to Section 7.13. Section 7.13 is hereby amended and restated in its entirety as follows:

 

“Equity
Cure. In the event Borrower fails to comply with the financial covenants set forth in Section 7.12 as of the last day of any
fiscal quarter, any cash equity contribution (funded with proceeds from a sale or issuance of Qualified Stock of Borrower) to
the capital of Borrower after the last day of such fiscal quarter and on or prior to the day that is 10 Business Days after the
day on which financial statements are required to be delivered for that fiscal quarter will, at the irrevocable election of Borrower,
be included in the calculation of Adjusted EBITDA solely for the purposes of determining compliance with such covenants in Section
7.12 at the end of such fiscal quarter (each, a “Cure Quarter”) and any subsequent period that includes such
Cure Quarter (any such equity contribution so included in the calculation of Adjusted EBITDA, a “Specified Equity Contribution”);
provided that (a) notice of Borrower’s intent to accept a Specified Equity Contribution shall be delivered by Borrower
to Bank no later than the day on which financial statements are required to be delivered for the applicable fiscal quarter, (b)
[reserved], (c) the amount of any Specified Equity Contribution will be no greater than 100% of the amount required to cause Borrower
and its Subsidiaries to be in compliance with such financial covenants (the “Cure Amount”), (d) [reserved],
(e) after December 31, 2020 Specified Equity Contributions shall not be made in any two consecutive quarters, (f) the aggregate
amount of all Specified Equity Contributions made under this Section 7.13 shall not exceed (i) $15,000,000 in the fiscal year
ended December 31, 2020 and (ii) $10,000,000 per annum in each calendar year thereafter, (g) Borrower shall immediately apply
the proceeds of a Specified Equity Contribution to prepay the Term Loan Advance in accordance with Section 2.3(d)(ii) and (h)
there shall be no reduction in Indebtedness in connection with any Specified Equity Contribution (or the application of the proceeds
thereof, including application of such proceeds for purposes of cash netting) for determining compliance with Section 7.12 for
the period ending on the last day of the applicable Cure Quarter; provided that following any prepayment of the Term Loan
Advance pursuant to Section 2.3(d)(ii) there shall be a reduction in Indebtedness for determining compliance with Section 7.12
in future fiscal quarters where such Cure Quarter is included in the applicable test period (but, for the avoidance of doubt,
there shall be no de-leveraging credit for the period ending on the last day of the Cure Quarter in respect of which the Specified
Equity Contribution is made). Upon Bank’s receipt of notice from Borrower of its intent to make a Specified Equity Contribution
pursuant to this Section 7.13 no later than the day on which financial statements are required to be delivered for the applicable
fiscal quarter, then, until the day that is 10 Business Days after such date, (x) Bank shall not exercise the right to accelerate
the Term Loan Advance or the Advances and Bank shall not exercise any right to foreclose on or take possession of the Collateral
and (y) notwithstanding anything to the contrary herein, the Default Rate shall not be applicable, in each case, solely on the
basis of an Event of Default having occurred and being continuing as a result of Borrower’s failure to be in compliance
with the financial covenants set forth in Section 7.12 in respect of the period ending on the last day of such fiscal quarter.
If, after giving effect to the foregoing pro forma adjustment (but not, for the avoidance of doubt, giving pro forma adjustment
to any repayment of Indebtedness in connection therewith), Borrower is in compliance with the financial covenants set forth in
Section 7.12, Borrower shall be deemed to have satisfied the requirements of Section 7.12 as of the relevant date of determination
with the same effect as though there had been no failure to comply on such date, and the applicable breach or default of Section
7.12 that had occurred shall be deemed cured for purposes of this Agreement.”

 

    	-6-

    	 

    

 

18.
Amendment to Section 7. Section 7 is hereby amended by inserting a new Section 7.14 immediately after Section 7.13
as follows:

 

“7.14
Additional Equity Investments. Borrower shall deliver to Bank (i) no later than June 30, 2020 (as such date may be extended
in Bank’s sole discretion) evidence, in form and substance satisfactory to Bank, that Borrower has received cash equity
investments in an aggregate amount no less than $15,000,000 during the six month period ending June 30, 2020 and (ii) no later
than December 31, 2020 (as such date may be extended in Bank’s sole discretion) evidence, in form and substance satisfactory
to Bank, that Borrower has received cash equity investments in an aggregate amount no less than $30,000,000 during the 12 month
period ending December 31, 2020, in each case, pursuant to documents, terms and conditions satisfactory to Bank.”

 

19.
Amendments to Section 13.1. (a) The definition of “Adjusted EBITDA” is hereby amended and restated in
its entirety as follows:

 

“‘Adjusted
EBITDA’ means, for Borrower and its Subsidiaries for any period, Consolidated Net Income for such period plus,
to the extent deducted in determining such Consolidated Net Income for such period (and without duplication), (i) Interest
Expense, (ii) income tax expense (including tax accruals), (iii) depreciation and amortization (but excluding patent
amortization, if any), (iv) any non-cash charges or expenses approved by Bank in its sole discretion (other than any such
non-cash item to the extent it represents an accrual of, or reserve for, anticipated cash expenditures in any future period),
(v) transaction costs and fees (A) related to the negotiation, execution and delivery of the Loan Documents, or (B) paid
after the Effective Date to Bank in connection with the Loan Documents, (vi) the amount of the prepayment fee paid on the
Effective Date in connection with the early extinguishment of Indebtedness owed to Siena Lending Group LLC under that certain
Loan and Security Agreement, dated as of August 10, 2018, by and among Borrower, NABC, Inc., NABC Properties, LLC, New Age
Health Sciences, Inc. and Siena Lending Group LLC, and (vii) any costs incurred with respect to liability, casualty events or
business interruption, to the extent covered by insurance (as confirmed by the applicable insurance company), the proceeds of
which are received during such period or within 120 days thereafter; provided that, notwithstanding anything to the
contrary herein, (I) any gain or loss from the sale of fixed assets and property which is, as of the date of this Agreement,
in the process of being sold by a Subsidiary of Borrower pursuant to a letter of intent dated February 4, 2019, as previously
disclosed to Bank shall be excluded from the calculation of Adjusted EBITDA and (II) no non-cash items related to the re-
evaluation of any previous Investment of the Borrower and/or its Subsidiaries shall be added to the calculation of Adjusted
EBITDA. Notwithstanding anything herein to the contrary, the aggregate amount added back pursuant to the prior sentence for
non-recurring expenses shall not exceed (x) $7,200,000 for the fiscal year ending December 31, 2018, (y) $4,000,000 for the
fiscal year ending December 31, 2020 and (z) $500,000 for any fiscal year thereafter.”

 

    	-7-

    	 

    

 

(b)
The definition of “Applicable Rate” is hereby amended and restated in its entirety as follows:

 

“‘Applicable
Rate’ means, for any day, the applicable rate set forth below under the caption “Prime Rate Spread” based
upon the Total Leverage Ratio as of the end of the fiscal quarter of Borrower for which consolidated financial statements have
theretofore been most recently delivered pursuant to Section 6.2(c) or Section 6.2(d):

 

	Total Leverage Ratio:	 	Prime Rate Spread	 
	Category 1 
Less than
    1.50 to 1.00	 	 	0.25%	
	Category 2
    
Greater than or equal to 1.50 to 1.00	 	 	0.50%	

 

For
purposes of the foregoing, each change in the Applicable Rate resulting from a change in the Total Leverage Ratio shall be effective
during the period commencing on and including the second Business Day following the date of delivery to Bank pursuant to Section
6.2(c) or Section 6.2(d) of the consolidated financial statements indicating such change and ending on the date immediately preceding
the effective date of the next such change. Notwithstanding the foregoing, on and after the Third Amendment Effective Date, the
Applicable Rate shall be 2.00% (i) until Borrower complies with the financial covenants set forth in Section 7.12(c) and Section
7.12(d) for two full consecutive fiscal quarters which begin and end after the Third Amendment Effective Date, (ii) at any time
that an Event of Default has occurred and is continuing or (iii) if Borrower shall fail to deliver the consolidated financial
statements required to be delivered pursuant to Section 6.2(c) or Section 6.2(d) or shall elect not to include in any certificate
required to be delivered pursuant to Section 6.2(e) the computations described in clause (iii) thereof, in each case within the
time periods specified herein for such delivery, during the period commencing on and including the day of the occurrence of a
default resulting from such failure and until the delivery thereof.”

 

    	-8-

    	 

    

 

(c)
The definition of “Obligations” is hereby amended and restated in its entirety as follows:

 

“‘Obligations’
are Borrower’s obligations to pay when due any debts, principal, interest, fees, Bank Expenses, the Unused Revolving Line
Facility Fee, the Prepayment Fee (if any), the Backend Fee and other amounts Borrower owes Bank now or later, whether under this
Agreement, the other Loan Documents, or otherwise, including, without limitation, all obligations relating to Bank Services and
interest accruing after Insolvency Proceedings begin and debts, liabilities or obligations of Borrower assigned to Bank, and to
perform Borrower’s duties under the Loan Documents.”

 

(d)
Section 13.1 of the Loan Agreement is hereby amended by adding the following defined terms in correct alphabetical order:

 

“Backend
Fee” is a payment (in addition to, and not a substitution for, the regular monthly payments of principal plus
accrued interest and any other fees and Obligations payable hereunder) due in accordance with Section 2.3 above, equal to
$150,000.

 

“Restricted
Cash Accounts” means the RMB Restricted Cash Account, the USD Restricted Cash Account and the USD Revolver Restricted
Cash Account.

 

“RMB”
means the lawful currency of the People’s Republic of China.

 

“RMB
Restricted Cash Account” means the account with account number ending 148 (last three digits) maintained by
Borrower with Bank or any of Bank’s Affiliates in China.

 

“Third
Amendment Effective Date” means March 13, 2020.

 

“USD
Restricted Cash Account” means the account with account number ending 161 (last three digits) maintained by
Borrower with Bank or any of Bank’s Affiliates in the United States.

 

“USD
Revolver Restricted Cash Account” means the account with account number ending 179 (last three digits) maintained by
Borrower with Bank or any of Bank’s Affiliates in the United States.

 

    	-9-

    	 

    

 

20.
Amendment to Exhibit B. Exhibit B to the Credit Agreement is hereby amended and restated in its entirety in the
form of Annex I attached hereto.

 

21.
Conditions to Effectiveness. This Third Amendment shall become effective upon (i) receipt by Bank of counterpart
signatures to this Third Amendment duly executed and delivered by Bank and Borrower and (ii) Bank’s receipt of payment of
an amendment fee in an amount equal to $40,000.00.

 

22.
Expenses. Borrower agrees to pay on demand all expenses of Bank (including, without limitation, the fees and out-of-pocket
expenses of Covington & Burling LLP, counsel to Bank) incurred in connection with the negotiation, preparation, execution
and delivery of this Third Amendment.

 

23.
Representations and Warranties. Borrower hereby represents and warrants to Bank as follows:

 

(a)
After giving effect to this Third Amendment, the representations and warranties contained in the Loan Agreement or any other Loan
Document shall be true, accurate and complete in all material respects; provided, however, that such materiality
qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality
in the text thereof; and provided, further that those representations and warranties expressly referring to a specific
date shall be true, accurate and complete in all material respects as of such date.

 

(b)
After giving effect to this Third Amendment, no default or Event of Default shall have occurred and be continuing.

 

24.
No Implied Amendment or Waiver. Except as expressly set forth in this Third Amendment, this Third Amendment shall
not, by implication or otherwise, limit, impair, constitute a waiver of or otherwise affect any rights or remedies of Bank under
the Loan Agreement or alter, modify, amend, waive or in any way affect any of the terms, obligations or covenants contained in
the Loan Agreement, all of which shall continue in full force and effect. Nothing in this Third Amendment shall be construed to
imply any willingness on the part of Bank to agree to or grant any similar or future consent, amendment or waiver of any of the
terms and conditions of the Loan Agreement or the other Loan Documents.

 

    	-10-

    	 

    

 

25.
Release. Borrower hereby acknowledges and agrees that: (a) to its knowledge neither it nor any of its Affiliates
have any claim or cause of action against Bank (or any of its Affiliates, officers, directors, employees, attorneys, consultants
or agents) under the Loan Agreement as of the date hereof and (b) to its knowledge, as of the date hereof, Bank has heretofore
properly performed and satisfied in a timely manner all of its obligations to Borrower under the Loan Agreement. Notwithstanding
the foregoing, Bank wishes to eliminate any possibility that any past conditions, acts, omissions, events or circumstances would
impair or otherwise adversely affect any of Bank’s rights, interests and/or remedies under the Loan Agreement. Accordingly,
for and in consideration of the agreements contained in this Third Amendment and other good and valuable consideration, Borrower
(for itself and its Affiliates and the successors and assigns of each of the foregoing) (each a “Releasor”
and collectively, the “Releasors”) does hereby fully, finally, unconditionally and irrevocably release and
forever discharge Bank and its Affiliates, officers, directors, employees, attorneys, consultants and agents (each a “Released
Party” and collectively, the “Released Parties”) from any and all debts, claims, obligations, damages,
costs, attorneys’ fees, suits, demands, liabilities, actions, proceedings and causes of action, in each case, whether known
or unknown, contingent or fixed, direct or indirect, and of whatever nature or description, and whether in law or in equity, under
contract, tort, statute or otherwise, in each case that exist or have occurred on or prior to the date of this Third Amendment
which any Releasor has heretofore had or now shall or may have against any Released Party by reason of any act, omission or thing
whatsoever done or omitted to be done, except for a Released Party’s gross negligence or willful misconduct as determined
by a final, non-appealable judgment of a court of competent jurisdiction, prior to the date hereof arising out of, connected with
or related in any way to the Loan Agreement, or any act, event or transaction related or attendant thereto, or Bank’s agreements
contained therein, or the possession, use, operation or control in connection therewith of any of the assets of Borrower, or the
making of any advance thereunder, or the management of such advance, in each case on or prior to the date of this Third Amendment.

 

26.
Counterparts. This Third Amendment may be executed by the parties hereto in several counterparts, each of which
shall be an original and all of which shall constitute together but one and the same agreement. Delivery of an executed counterpart
of a signature page to this Third Amendment by e-mail (e.g., “pdf” or “tiff”) or telecopy shall be effective
as delivery of a manually executed counterpart of this Third Amendment.

 

27.
Governing Law. THIS THIRD AMENDMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAW OF THE STATE OF
NEW YORK WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW.

 

[Signature
Page Follows.]

 

    	-11-

    	 

    

 

IN
WITNESS WHEREOF, the parties hereto have caused this Third Amendment to be executed by their respective officers thereunto
duly authorized as of the day and year first above written.

 

	 	NEW
    AGE BEVERAGES CORPORATION, 
	 	as
    Borrower
	 	 
	 	By:	/s/
    Gregory A. Gould                         
	 	Name:	Gregory
    A. Gould
	 	Title:	Chief
    Financial Officer

 

	 	EAST
    WEST BANK,
	 	as
    Bank
	 	 	 
	 	By:	/s/
    Kelvin Chan                
	 	Name:	Kelvin
    Chan
	 	Title:	Managing
    Director

 

Signature
Page to Third Amendment and Waiver to Loan and Security AgreementExhibit

Exhibit 4.1
DESCRIPTION OF THE REGISTRANT’S SECURITIES
REGISTERED PURSUANT TO SECTION 12 OF THE SECURITIES
EXCHANGE ACT OF 1934
 As of December 31, 2019, Accel Entertainment, Inc. (the “Company,” “we” or “our”) had two classes of securities registered under Section 12 of the Securities Exchange Act of 1934: our Class A-1 common stock and our warrants. 
Description of Capital Stock
The following summary of the terms of our capital stock is based upon our amended and restated certificate of incorporation and our amended and restated bylaws. The summary is not complete, and is qualified by reference to our amended and restated certificate of incorporation and our amended and restated bylaws, which are filed as exhibits to this Annual Report on Form 10-K and are incorporated by reference herein. We encourage you to read our amended and restated certificate of incorporation, our amended and restated bylaws and the applicable provisions of the Delaware General Corporation Law, or DGCL, for additional information.
General
We have authorized capital stock consisting of (a) 280,000,000 shares of common stock, including three separate series of common stock consisting of (i) 250,000,000 shares of Class A-1 Common Stock, (ii) 10,000,000 shares of Class A-2 Common Stock and (iii) 20,000,000 shares of Class F Common Stock (collectively, the “Common Stock”) and (b) 1,000,000 shares of preferred stock with a par value of $0.0001 per share (the “Preferred Stock”). 
Common Stock 
Dividend rights 
Subject to applicable law and the rights, if any, of the holders of any outstanding series of the Preferred Stock and except as otherwise set forth herein, the holders of shares of Class A-1 Common Stock shall be entitled to receive such dividends and other distributions (payable in cash, property or capital stock of the Company) when, as and if declared thereon by the Company’s board of directors from time to time out of any assets or funds of the Company legally available therefor and shall share equally on a per share basis in such dividends and distributions subject to such rights of the holders of Preferred Stock. 
Voting rights
Except as otherwise required by law or our amended and restated certificate of incorporation (including any resolution or resolution adopted by the Company’s board of directors providing for the issuance of one or more series of Preferred Stock stating the voting rights, if any, designations, powers, preferences and relative, participating, optional, special and other rights, if any, of each such series and any qualifications, limitations and restrictions thereof and included in a certificate of designation (a “Preferred Stock Designation”)), holders of shares of Class A-1 common stock exclusively possess all voting power with respect to the Company, including with respect to the election of directors, and shall be entitled to one vote for each share of Class A-1 common stock on each matter properly submitted to the stockholders on which holders of shares of Class A-1 common stock are entitled to vote. However, except as otherwise required by law or our amended and restated certificate of incorporation (including any Preferred Stock Designation), holders of any series of Common Stock shall not be entitled to vote on any amendment to our amended and restated certificate of incorporation (including any amendment to any Preferred Stock Designation) that relates solely to the terms of one or more outstanding series of Preferred Stock or other series of Common Stock if the holders of such affected series of Preferred Stock or Common Stock, as applicable, are entitled, either separately or together with the holders of one or more other such series, to vote thereon pursuant to our amended and restated certificate of incorporation (including any Preferred Stock Designation) or the DGCL. 
No preemptive or similar rights 
The holders of Common Stock do not have preemptive or other subscription rights and there is no sinking fund or redemption provisions applicable to the Common Stock. 

Conversion
The Company is party to that certain Restricted Stock Agreement (the “Restricted Stock Agreement”), which is filed as an exhibit to this Annual Report on Form 10-K and is incorporated by reference herein, pursuant to which certain of the Company’s shares of Class A-2 common stock will be exchanged for an equal number of validly issued, fully paid and non-assessable shares of Class A-1 Common Stock. The exchange of shares of Class A-2 common stock for shares of Class A-1 common stock will be subject to the terms and conditions set forth in the Restricted Stock Agreement, with such exchanges occurring in three separate tranches upon the satisfaction of the following triggers: 
		
	•
	Tranche I, equal to 1,666,666 shares of Class A-2 common stock, will be exchanged for shares of Class A-1 common stock if either (i) the EBITDA for the last twelve months (“LTM EBITDA”) of the Company (as determined pursuant to the Restricted Stock Agreement) as of December 31, 2021, March 31, 2022 or June 30, 2022 equals or exceeds $132 million or (ii) the closing sale price of shares of Class A-1 common stock on the NYSE equals or exceeds $12.00 for at least twenty trading days in any consecutive thirty trading day period (which threshold was reached on January 14, 2020, resulting in the issuance of 1,596,636 shares of Class A-1 common stock upon exchange of shares of Class A-2 common stock); 

		
	•
	Tranche II, equal to 1,666,667 shares of Class A-2 common stock, will be exchanged for shares of Class A-1 common stock if either (i) the LTM EBITDA of the Company (as determined pursuant to the Restricted Stock Agreement) as of December 31, 2022, March 31, 2023 or June 30, 2023 equals or exceeds $152 million or (ii) the closing sale price of shares of Class A-1 common stock on the NYSE equals or exceeds $14.00 for at least twenty trading days in any 30 trading day period; and 

		
	•
	Tranche III, equal to 1,666,667 shares of Class A-2 common stock, will be exchanged for shares of Class A-1 common stock if either (i) the LTM EBITDA of the Company (as determined pursuant to the Restricted Stock Agreement) as of December 31, 2023, March 31, 2024 or June 30, 2024 equals or exceeds $172 million or (ii) the closing sale price of shares of Class A-1 common stock on the NYSE equals or exceeds $16.00 for at least twenty trading days in any 30 trading day period. The LTM EBITDA and LTM EBITDA thresholds will be reasonably adjusted by the independent directors of the Company’s board of directors from time to time to take into account the anticipated effect of any acquisitions or dispositions that exceed certain thresholds and are otherwise materially different from certain forecasts.

Notwithstanding the foregoing, shares of Class A-2 common stock, if not previously exchanged pursuant to the triggers described above, will be exchanged for an equal number of shares of Class A-1 common stock immediately prior to the consummation of a transaction or series of related transactions that would result in a third party or group (as defined in or under Section 13 of the Exchange Act) becoming the beneficial owner of, directly or indirectly, more than fifty percent of the total voting power of the equity securities of the Company, or more than fifty percent of the consolidated net revenues, net income or total assets (including equity securities of its subsidiaries) of the Company, provided that the satisfaction of the conditions set forth in the aforementioned triggers cannot be determined at such time. 
The Restricted Stock Agreement further provides that holders of shares of Class A-2 common stock are not required to exchange such shares for shares of Class A-1 common stock if, (x) prior to giving effect to exchanges pursuant to the triggers described above, such holder beneficially owns less than 4.99% of the issued and outstanding shares of Class A-1 common stock, and (y) after giving effect to the exchanges pursuant to the triggers described above, such holder would beneficially own in excess of 4.99% of the issued and outstanding shares of Class A-1 common stock. However, notwithstanding the limitation described in the previous sentence, if and when a holder of shares of Class A-2 common stock has obtained all required gaming approvals from the applicable gaming authorities permitting such holder to beneficially own shares of Class A-1 common stock in excess of 4.99%, then the shares of Class A-2 common stock held by such holder which are subject to exchange shall immediately be exchanged for shares of Class A-1 common stock without regard to the limitation. 
The shares of Class A-2 common stock may not be transferred, other than to certain permitted transferees as set forth in the Restricted Stock Agreement, and the rights and obligations under the Restricted Stock Agreement may not be assigned to any person or entity, other than to certain permitted transferees as set forth in the Restricted Stock Agreement. 
Upon exchange of shares of Class A-2 common stock to shares of Class A-1 common stock, such shares of Class A-2 common stock will be canceled and the number of authorized shares of Class A-2 common stock will be reduced by a corresponding number. 
Right to receive liquidation distributions 
In the event of any voluntary or involuntary liquidation, dissolution or winding up of the Company, after payment or provision for payment of the debts and other liabilities of the Company, and subject to applicable law and to the rights, if any, of 

the holders of outstanding Preferred Stock in respect thereof, the holders of shares of Class A-1 Common Stock shall be entitled to receive all the remaining assets of the Company available for distribution to its stockholders, ratably in proportion to the shares of Class A-1 common stock held by them. 
Preferred Stock 
Our amended and restated certificate of incorporation provides that the Company’s board of directors is authorized to provide out of the unissued shares of the Preferred Stock for one or more series of Preferred Stock, establish the number of shares to be included in each such series and fix the voting rights, designations, powers, preferences and relative, participating, optional, special and other rights, of each such series and any qualifications, limitations and restrictions thereof, as stated in the resolution or resolutions adopted by the Company’s board of directors providing for the issuance of such series and included in a Preferred Stock Designation filed pursuant to the DGCL. The number of authorized shares of Preferred Stock may be increased or decreased (but not below the number of shares thereof then outstanding or reserved for issuance) by the affirmative vote of the holders of a majority of the outstanding shares of Class A-1 common stock, without a vote of the holders of the Preferred Stock, or any series thereof, unless a vote of any such holders of Preferred Stock is required pursuant to amended and restated certificate of incorporation, including any Preferred Stock Designation. As of December 31, 2019, the Company had no shares of Preferred Stock outstanding. Although the Company does not currently intend to issue any Preferred Stock, it may do so in the future. 

Our amended and restated certificate of incorporation provides that the Company has the authority to create and issue rights, warrants and options entitling the holders thereof to acquire from the Company any shares of its capital stock of any class or classes, with such rights, warrants and options to be evidenced by or in instrument(s) approved by the Company’s board of directors. The Company’s board of directors is empowered to set the exercise price, duration, times for exercise and other terms and conditions of such rights, warrants or options; provided, however, that the consideration to be received for any shares of capital stock issuable upon exercise thereof may not be less than the par value thereof. 

Anti-Takeover Provisions 
The provisions of Delaware law, our amended and restated certificate of incorporation, and our amended and restated bylaws could have the effect of delaying, deferring, or discouraging another person from acquiring control of our company. These provisions, which are summarized below, may have the effect of discouraging takeover bids. 
Delaware Law 
We are subject to the provisions of Section 203 of the DGCL regulating corporate takeovers. In general, DGCL Section 203 prohibits a publicly held Delaware corporation from engaging in a business combination with an interested stockholder for a period of three years following the date on which the person became an interested stockholder unless: 
		
	•
	prior to the date of the transaction, the board of directors of the corporation approved either the business combination or the transaction which resulted in the stockholder becoming an interested stockholder; 

		
	•
	the interested stockholder owned at least 85% of the voting stock of the corporation outstanding at the time the transaction commenced, excluding for purposes of determining the voting stock outstanding, but not the outstanding voting stock owned by the interested stockholder, (i) shares owned by persons who are directors and also officers and (ii) shares owned by employee stock plans in which employee participants do not have the right to determine confidentially whether shares held subject to the plan will be tendered in a tender or exchange offer; or

		
	•
	at or subsequent to the date of the transaction, the business combination is approved by the board of directors of the corporation and authorized at an annual or special meeting of stockholders, and not by written consent, by the affirmative vote of at least 66.67% of the outstanding voting stock that is not owned by the interested stockholder. 

Generally, a business combination includes a merger, asset or stock sale, or other transaction or series of transactions together resulting in a financial benefit to the interested stockholder. An interested stockholder is a person who, together with affiliates and associates, owns or, within three years prior to the determination of interested stockholder status, did own 15% or more of a corporation’s outstanding voting stock. We expect the existence of this provision to have an anti-takeover effect with respect to transactions our board of directors does not approve in advance. We also anticipate that DGCL Section 203 may also discourage attempts that might result in a premium over the market price for the shares of common stock held by stockholders.  
Amended and Restated Certificate of Incorporation and Amended and Restated Bylaws Provisions 
Our amended and restated certificate of incorporation and our amended and restated bylaws include a number of provisions that could deter hostile takeovers or delay or prevent changes in control of our management team, including the following: 

		
	•
	Board of Directors Vacancies. Our amended and restated certificate of authorizes only our board of directors to fill vacant directorships, including newly created seats. In addition, the number of directors constituting our board of directors is permitted to be set only by a resolution adopted by a majority vote of our entire board of directors. These provisions prevent a stockholder from increasing the size of our board of directors and then gaining control of our board of directors by filling the resulting vacancies with its own nominees. This makes it more difficult to change the composition of our board of directors but promotes continuity of management.

		
	•
	Classified Board. Our amended and restated certificate of incorporation provides that our board of directors is classified into three classes of directors. The existence of a classified board of directors could discourage a third-party from making a tender offer or otherwise attempting to obtain control of us as it is more difficult and time consuming for stockholders to replace a majority of the directors on a classified board of directors. 

		
	•
	Directors Removed Only for Cause. Our amended and restated certificate of incorporation provides that stockholders may remove directors only for cause.

		
	•
	Stockholder Action; Special Meeting of Stockholders. Our amended and restated certificate of incorporation and our amended and restated bylaws provide that special meetings of our stockholders may be called only by a majority of our board of directors, the chairman of our board of directors or our chief executive officer, thus prohibiting a stockholder from calling a special meeting. Our amended and restated certificate of incorporation further provides that our stockholders may not take action by written consent, but may only take action at annual or special meetings of our stockholders. As a result, holders of our capital stock would not be able to amend our amended and restated bylaws or remove directors without a meeting of our stockholders called in accordance with our amended and restated certificate of incorporation. These provisions might delay the ability of our stockholders to force consideration of a proposal or for stockholders to take any action, including the removal of directors.

		
	•
	Advance Notice Requirements for Stockholder Proposals and Director Nominations.    Our amended and restated bylaws provide advance notice procedures for stockholders seeking to bring business before our annual meeting of stockholders or to nominate candidates for election as directors at our annual meeting of stockholders. Our amended and restated bylaws also specify certain requirements regarding the form and content of a stockholder’s notice. These provisions might preclude our stockholders from bringing matters before our annual meeting of stockholders or from making nominations for directors at our annual meeting of stockholders if the proper procedures are not followed. We expect that these provisions might also discourage or deter a potential acquirer from conducting a solicitation of proxies to elect the acquirer’s own slate of directors or otherwise attempting to obtain control of our company.

		
	•
	No Cumulative Voting. The DGCL provides that stockholders are not entitled to the right to cumulate votes in the election of directors unless a corporation’s certificate of incorporation provides otherwise. Our amended and restated certificate of incorporation and amended and restated bylaws do not provide for cumulative voting.

		
	•
	Issuance of Undesignated Preferred Stock. Our board of directors has the authority, without further action by the stockholders, to issue up to 1,000,000 shares of undesignated preferred stock with rights and preferences, including voting rights, designated from time to time by our board of directors. The existence of authorized but unissued shares of preferred stock enables our board of directors to render more difficult or to discourage an attempt to obtain control of us by means of a merger, tender offer, proxy contest, or other means.

		
	•
	Choice of Forum. Subject to certain limitations, the our amended and restated certificate of incorporation provides that unless the Company consents in writing to the selection of an alternative forum, the Court of Chancery in the State of Delaware shall be the sole and exclusive forum for any stockholder (including a beneficial owner) to bring: (i) any derivative action or proceeding brought on behalf of the Company; (ii) any action asserting a claim of breach of fiduciary duty owed by any director or officer of the Company to the Company or the Company’s stockholders, creditors or other constituents; (iii) any action asserting a claim arising pursuant to any provision of the DGCL or our amended and restated certificate of incorporation or our amended and restated bylaws; or (iv) any action asserting a claim against the Company governed by the internal affairs doctrine.

Warrants
For purposes of the following description of our warrants:

		
	(i)
	“Accel” means the historical operations of Accel Entertainment, Inc., an Illinois corporation, and its consolidated subsidiaries prior to the Business Combination, and following the Business Combination, the operations of Accel Entertainment, Inc., a Delaware corporation, and its consolidated subsidiaries;  

		
	(ii)
	“Accel Public Warrants” means the 1,248,154 Accel Warrants issued on a registered basis to Sellers in connection with the Business Combination; 

		
	(iii)
	“Accel Warrants” means warrants exercisable for shares of Class A-1 common stock of the Company, which include the Pace Warrants, Accel Public Warrants and Business Combination Private Placement Warrants; 

		
	(iv)
	 “Business Combination” shall refer to the transactions contemplated by that certain Transaction Agreement, dated as of June 13, 2019 (as amended on July 22, 2019 and October 3, 2019), by and among Pace, each of David W. Ruttenberg and John S. Bakalar (as successor to Gordon Rubenstein) (in their capacity as representatives of the shareholders of Accel) and the stockholders of Accel (the “Sellers”) party thereto, which is filed as an exhibit to this Annual Report on Form 10-K and is incorporated by reference herein;

		
	(v)
	“Business Combination Private Placement” refers to the private placement completed in reliance upon the exemption provided in Section 4(a)(2) of the Securities Act and/or Regulation D promulgated thereunder to the Sellers of Class A-1 shares, Class A-2 shares and Accel Warrants in connection with the Business Combination;

		
	(vi)
	“Business Combination Private Placement Warrants” means the 1,196,283 Accel Warrants issued in the Business Combination Private Placement;

		
	(vii)
	“initial business combination” shall refer to the Business Combination, as applicable. From and after the Business Combination, the Pace Warrants became securities of the Company, and upon satisfaction of the applicable conditions described below, are exercisable for shares of Class A-1 common stock of the Company;

		
	(viii)
	“Initial Pace Sponsor” means TPG Pace II Sponsor, LLC, a Cayman Islands exempted limited liability company and an affiliate of TPG; 

		
	(ix)
	“Pace” shall refer to the historical operations of TPG Pace Holdings Corp. prior to the consummation of the Business Combination and shall refer to the Company following the Business Combination,

		
	(x)
	“Pace Domestication” means the domestication of Pace as a Delaware corporation on November 20, 2019;

		
	(xi)
	“Pace Private Placement Warrants” means Accel Warrants that were issued to Initial Pace Sponsor in a private placement that closed simultaneously with the consummation of Pace’s initial public offering, consummated on June 30, 2017;

		
	(xii)
	“Pace Public Shares” mean the Class A ordinary shares, par value $0.0001 per share, of Pace;

		
	(xiii)
	“Pace Public Unit” means one Pace Public Share and one-third of a Pace Public Warrant, sold in Pace’s initial public offering, consummated on June 30, 2017;

		
	(xiv)
	“Pace Public Warrants” means Accel Warrants that were included in the Pace Public Units sold in Pace’s initial public offering, consummated on June 30, 2017; and

		
	(xv)
	“Pace Warrants” means the Pace Public Warrants and the Pace Private Placement Warrants, collectively.

Pace Warrants
Prior to the Pace Domestication, each Pace Public Warrant entitled the registered holder to purchase one Pace Public Share at a price of $11.50 per share. Upon the Pace Domestication, each Pace Public Share converted to one share of Class A-1 common stock, and each Pace Public Warrant entitles the holder to acquire a corresponding number of shares of Class A-1 common stock on the same terms as in effect immediately prior to the effective time of the Pace Domestication. Following the Business Combination, each Pace Public Warrant entitles the registered holder to purchase one share of Class A-1 common stock at a price of $11.50 per share, subject to adjustment as discussed below, at any time 30 days after the completion of the Business Combination. Prior to the Pace Domestication, each Pace Private Placement Warrant entitled the registered holder to purchase one Pace Public Share at a price of $11.50 per share. Following the Pace Domestication, each Pace Private Placement Warrant entitles the holder to acquire a corresponding number of shares of Class A-1 common stock on the same terms as in effect immediately prior to the effective time of the Pace Domestication. Except as described below, the Pace Private Placement Warrants have terms and provisions that are identical to those of the Pace Public Warrants. 
Each Pace Warrant must be exercised for a whole share of Class A-1 common stock. The Pace Warrants will expire five years after the completion of an initial business combination, at 5:00 p.m., New York City time, or earlier upon redemption or liquidation.
The Company will not be obligated to deliver any shares of Class A-1 common stock pursuant to the exercise of a Pace Public Warrant and will have no obligation to settle such Pace Public Warrant exercise unless a registration statement under the Securities Act with respect to the shares of Class A-1 common stock underlying the Pace Public Warrant is then effective and a prospectus relating thereto is current, subject to Pace satisfying its obligations described below with respect to registration. No Pace Public Warrant will be exercisable for cash or on a cashless basis, and Pace will not be obligated to issue any shares of Class A-1 common stock to holders seeking to exercise their Pace Public Warrants, unless the issuance of the shares upon such exercise 

is registered or qualified under the securities laws of the state of the exercising holder, or an exemption is available. In the event that the conditions in the two immediately preceding sentences are not satisfied with respect to a Pace Public Warrant, the holder of such Pace Public Warrant will not be entitled to exercise such Pace Public Warrant and such Pace Public Warrant may have no value and expire worthless. In no event will Pace be required to net cash settle any Pace Public Warrant. In the event that a registration statement is not effective for the exercised Pace Public Warrants, a warrantholder that acquired such Pace Public Warrant through the purchase of a Pace Public Unit containing such Pace Public Warrant will have paid the full purchase price for the Pace Public Unit solely for the Pace Public Share (which converted into a share of Class A-1 common stock upon the Pace Domestication) underlying such Pace Public Unit.
Pace has agreed that as soon as practicable, but in no event later than fifteen (15) business days, after the consummation of the Business Combination, the Company will use its best efforts to file with the SEC a registration statement for the registration, under the Securities Act, of the shares of Class A-1 common stock issuable upon exercise of the Pace Warrants, which burden the Company initially met with the filing of a Registration Statement on Form S-3 on December 13, 2019. The Company will use its best efforts to cause the same to become effective and to maintain the effectiveness of such registration statement, and a current prospectus relating thereto, until the expiration of the Pace Warrants in accordance with the provisions of that certain Warrant Agreement, by and between Pace and Continental Stock Transfer & Trust Company, as warrant agent, dated as of June 27, 2017 (the “Continental Warrant Agreement”). Notwithstanding the above, if the shares of Class A-1 common stock are at the time of any exercise of a Pace Warrant not listed on a national securities exchange such that it satisfies the definition of a “covered security” under Section 18(b)(1) of the Securities Act, the Company may, at its option, require holders of Pace Public Warrants who exercise their Pace Public Warrants to do so on a “cashless basis” in accordance with Section 3(a)(9) of the Securities Act and, in the event the Company so elects, the Company will not be required to file or maintain in effect a registration statement, but will use its best efforts to register or qualify the shares under applicable blue sky laws to the extent an exemption is not available.
 
Redemption of Pace Warrants for Cash. 
Once the Pace Warrants become exercisable, the Company may redeem such Pace Warrants:
		
	•
	in whole and not in part;

		
	•
	at a price of $0.01 per Pace Warrant;

		
	•
	upon not less than 30 days’ prior written notice of redemption (the “30-day redemption period”) to registered holders of the Pace Public Warrants; and

		
	•
	if, and only if, the reported last sale price of the shares of Class A-1 common stock equals or exceeds $18.00 per share (as adjusted for share splits, share dividends, reorganizations, recapitalizations and the like) for any 20 trading days within a 30-trading day period ending on the third trading day prior to the date the Company sends to the notice of redemption to the holders of the Pace Warrants.

If and when the Pace Warrants become redeemable by the Company, the Company may exercise its redemption right even if the Company is unable to register or qualify the underlying securities for sale under all applicable state securities laws.
The last of the redemption criterion discussed above was established to prevent a redemption call unless there is at the time of the call a significant premium to the warrant exercise price. If the foregoing conditions are satisfied and the Company issues a notice of redemption of the Pace Warrants, each holder of a Pace Warrant will be entitled to exercise his, her or its Pace Public Warrant prior to the scheduled redemption date. However, the price of the shares of Class A-1 common stock may fall below the $18.00 redemption trigger price as well as the $11.50 warrant exercise price after the redemption notice is issued.

Redemption of Pace Warrants for Shares of Class A-1 common stock. 
Ninety days after the Pace Warrants become exercisable, the Company may redeem the outstanding Pace Warrants (except as described herein with respect to the Pace Private Placement Warrants):
		
	•
	in whole and not in part;

		
	•
	at a price equal to a number of shares of Class A-1 common stock to be determined by reference to the table below, based on the redemption date and the “fair market value” of the shares of Class A-1 common stock except as otherwise described below;

		
	•
	upon a minimum of 30 days’ prior written notice of redemption; and

		
	•
	if, and only if, the last sale price of the shares of Class A-1 common stock equals or exceeds $10.00 per share (as adjusted per share splits, share dividends, reorganizations, reclassifications, recapitalizations and the like) on the trading day prior to the date on which the Company sends the notice of redemption to the holders of Pace Warrants.

The numbers in the table below represent the “redemption prices,” or the number of shares of Class A-1 common stock that a holder of Pace Warrants will receive upon redemption by the Company pursuant to this redemption feature, based on the “fair market value” of the shares of Class A-1 common stock on the corresponding redemption date, determined based on the average of the last reported sales price for the 10 trading days ending on the third trading day prior to the date on which the notice of redemption is sent to the holders of Pace Warrants, and the number of months that the corresponding redemption date precedes the expiration date of the Pace Warrants, each as set forth in the table below.
	
																												
	Redemption Date
	 
	Fair Market Value of Class A-1 shares

	(period to expiration of the New Accel Warrants)
	 
	$10.00
	 
	$11.00
	 
	$12.00
	 
	$13.00
	 
	$14.00
	 
	$15.00
	 
	$16.00
	 
	$17.00
	 
	$18.00

	57 months
	 
	0.257
	

	 
	0.277
	

	 
	0.294
	

	 
	0.310
	

	 
	0.324
	

	 
	0.337
	

	 
	0.348
	

	 
	0.358
	

	 
	0.365
	

	54 months
	 
	0.252
	

	 
	0.272
	

	 
	0.291
	

	 
	0.307
	

	 
	0.322
	

	 
	0.335
	

	 
	0.347
	

	 
	0.357
	

	 
	0.365
	

	51 months
	 
	0.246
	

	 
	0.268
	

	 
	0.287
	

	 
	0.304
	

	 
	0.320
	

	 
	0.333
	

	 
	0.346
	

	 
	0.357
	

	 
	0.365
	

	48 months
	 
	0.241
	

	 
	0.263
	

	 
	0.283
	

	 
	0.301
	

	 
	0.317
	

	 
	0.332
	

	 
	0.344
	

	 
	0.356
	

	 
	0.365
	

	45 months
	 
	0.235
	

	 
	0.258
	

	 
	0.279
	

	 
	0.298
	

	 
	0.315
	

	 
	0.330
	

	 
	0.343
	

	 
	0.356
	

	 
	0.365
	

	42 months
	 
	0.228
	

	 
	0.252
	

	 
	0.274
	

	 
	0.294
	

	 
	0.312
	

	 
	0.328
	

	 
	0.342
	

	 
	0.355
	

	 
	0.364
	

	39 months
	 
	0.221
	

	 
	0.246
	

	 
	0.269
	

	 
	0.290
	

	 
	0.309
	

	 
	0.325
	

	 
	0.340
	

	 
	0.354
	

	 
	0.364
	

	36 months
	 
	0.213
	

	 
	0.239
	

	 
	0.263
	

	 
	0.285
	

	 
	0.305
	

	 
	0.323
	

	 
	0.339
	

	 
	0.353
	

	 
	0.364
	

	33 months
	 
	0.205
	

	 
	0.232
	

	 
	0.257
	

	 
	0.280
	

	 
	0.301
	

	 
	0.320
	

	 
	0.337
	

	 
	0.352
	

	 
	0.364
	

	30 months
	 
	0.196
	

	 
	0.224
	

	 
	0.250
	

	 
	0.274
	

	 
	0.297
	

	 
	0.316
	

	 
	0.335
	

	 
	0.351
	

	 
	0.364
	

	27 months
	 
	0.185
	

	 
	0.214
	

	 
	0.242
	

	 
	0.268
	

	 
	0.291
	

	 
	0.313
	

	 
	0.332
	

	 
	0.350
	

	 
	0.364
	

	24 months
	 
	0.173
	

	 
	0.204
	

	 
	0.233
	

	 
	0.260
	

	 
	0.285
	

	 
	0.308
	

	 
	0.329
	

	 
	0.348
	

	 
	0.364
	

	21 months
	 
	0.161
	

	 
	0.193
	

	 
	0.223
	

	 
	0.252
	

	 
	0.279
	

	 
	0.304
	

	 
	0.326
	

	 
	0.347
	

	 
	0.364
	

	18 months
	 
	0.146
	

	 
	0.179
	

	 
	0.211
	

	 
	0.242
	

	 
	0.271
	

	 
	0.298
	

	 
	0.322
	

	 
	0.345
	

	 
	0.363
	

	15 months
	 
	0.130
	

	 
	0.164
	

	 
	0.197
	

	 
	0.230
	

	 
	0.262
	

	 
	0.291
	

	 
	0.317
	

	 
	0.342
	

	 
	0.363
	

	12 months
	 
	0.111
	

	 
	0.146
	

	 
	0.181
	

	 
	0.216
	

	 
	0.250
	

	 
	0.282
	

	 
	0.312
	

	 
	0.339
	

	 
	0.363
	

	9 months
	 
	0.090
	

	 
	0.125
	

	 
	0.162
	

	 
	0.199
	

	 
	0.237
	

	 
	0.272
	

	 
	0.305
	

	 
	0.336
	

	 
	0.362
	

	6 months
	 
	0.065
	

	 
	0.099
	

	 
	0.137
	

	 
	0.178
	

	 
	0.219
	

	 
	0.259
	

	 
	0.296
	

	 
	0.331
	

	 
	0.362
	

	3 months
	 
	0.034
	

	 
	0.065
	

	 
	0.104
	

	 
	0.150
	

	 
	0.197
	

	 
	0.243
	

	 
	0.286
	

	 
	0.326
	

	 
	0.361
	

	0 months
	 
	—
	

	 
	—
	

	 
	0.042
	

	 
	0.115
	

	 
	0.179
	

	 
	0.233
	

	 
	0.281
	

	 
	0.323
	

	 
	0.361
	

The “fair market value” of shares of Class A-1 common stock shall mean the average reported last sale price of the shares of Class A-1 common stock for the 10 trading days ending on the third trading day prior to the date on which the notice of redemption is sent to the holders of Pace Warrants.
The exact fair market value and redemption date may not be set forth in the table above, in which case, if the fair market value is between two values in the table or the redemption date is between two redemption dates in the table, the number of shares of Class A-1 common stock to be issued for each Pace Warrant redeemed will be determined by a straight-line interpolation between 

the number of shares set forth for the higher and lower fair market values and the earlier and later redemption dates, as applicable, based on a 365-day year. For example, if the average reported last sale price of the shares of Class A-1 common stock for the 10 trading days ending on the third trading date prior to the date on which the notice of redemption is sent to the holders of the Pace Warrants is $11 per share, and at such time there are 57 months until the expiration of the Pace Warrants, the Company may choose to, pursuant to this redemption feature, redeem the Pace Warrant at a “redemption price” of 0.277 shares of Class A-1 common stock for each whole Pace Warrant. For an example where the exact fair market value and redemption date are not as set forth in the table above, if the average reported last sale price of shares of Class A-1 common stock for the 10 trading days ending on the third trading date prior to the date on which the notice of redemption is sent to the holders of the Pace Warrants is $13.50 per share, and at such time there are 38 months until the expiration of the Pace Warrants, the Company may choose to, pursuant to this redemption feature, redeem the warrants at a “redemption price” of 0.298 shares of Class A-1 common stock for each whole Pace Warrants. Finally, as reflected in the table above, the Company can redeem the Pace Warrants for no consideration in the event that the Pace Warrants are “out of the money” (i.e. the trading price of the shares of Class A-1 common stock is below the exercise price of the Pace Warrants) and about to expire.
Any Pace Public Warrants held by the Company’s officers or directors will be subject to this redemption feature, except that such officers and directors shall only receive “fair market value” for such Pace Public Warrants so redeemed (“fair market value” for such Pace Public Warrants held by the Company’s officers or directors being defined as the last sale price of the Pace Public Warrants on such redemption date).
This redemption feature differs from the typical warrant redemption features used in other blank check offerings, which typically only provide for a redemption of warrants for cash (other than Pace Private Placement Warrants) when the trading price for Class A ordinary shares exceeds $18.00 per share for a specified period of time. This redemption feature is structured to allow for all of the outstanding Pace Warrants (other than Pace Private Placement Warrants) to be redeemed when the shares of Class A-1 common stock are trading at or above $10.00 per share, which may be at a time when the trading price of the shares of Class A-1 common stock is below the exercise price of the Pace Warrants. This redemption feature has been established to provide the Pace Warrants with an additional liquidity feature, which provides the Company with the flexibility to redeem the Pace Warrants for shares of Class A-1 common stock, instead of cash, for “fair value” without the warrants having to reach the $18.00 per share threshold set forth above under “- Redemption of Pace Warrants for Cash.” Holders of the Pace Warrants will, in effect, receive a number of shares having a value reflecting a premium for their Pace Warrants, based on the “redemption price” as determined pursuant to the above table. The “redemption prices” as set forth in the table above have been calculated to reflect a premium in value as compared to the expected trading price that the Pace Warrants would be expected to trade. This redemption right provides the Company not only with an additional mechanism by which to redeem all of the outstanding Pace Warrants, in this case, for shares of Class A-1 common stock, and therefore have certainty as to (i) its capital structure as the Pace Warrants would no longer be outstanding and would have been exercised or redeemed and (ii) to the amount of cash provided by the exercise of the Pace Warrants and available to the Company, and also provides a ceiling to the theoretical value of the warrants as it locks in the “redemption prices” the Company would pay to holders of Pace Warrants if the Company chose to redeem Pace Warrants in this manner. While the Company will effectively be required to pay a “premium” to holders of Pace Warrants if the Company chooses to exercise this redemption right, it will allow the Company to quickly proceed with a redemption of the warrants for shares of Class A-1 common stock if the Company determines it is in its best interest to do so. As such, the Company would redeem the Pace Warrants in this manner when the Company believes it is in its best interest to update its capital structure to remove the Pace Warrants and pay the premium to the holders of Pace Warrants. In particular, it would allow the Company to quickly redeem the Pace Warrants for shares of Class A-1 common stock, without having to negotiate a redemption price with the holders of Pace Warrants, which in some situations, may allow the Company to more quickly and easily close an initial business combination. And for this right, the Company is effectively agreeing to pay a premium to the holders Pace Warrants. In addition, the holders of Pace Warrants will have the ability to exercise their Pace Warrants prior to redemption if they should choose to do so.
As stated above, the Company can redeem the Pace Warrants when the shares of Class A-1 common stock are trading at a price starting at $10.00, which is below the exercise price of $11.50, because it will provide certainty with respect to the Company’s capital structure and cash position while providing holders of Pace Warrants with a premium (in the form of shares of Class A-1 common stock). If the Company chooses to redeem the Pace Warrants when the shares of Class A-1 common stock are trading at a price below the exercise price of the Pace Warrants, this could result in the holders of Pace Warrants receiving fewer shares of Class A-1 common stock than they would have received if they had chosen to wait to exercise their Pace Warrants for shares of Class A-1 common stock if and when such shares of Class A-1 common stock were trading at a price higher than the exercise price of $11.50.
No fractional shares of Class A-1 common stock will be issued upon redemption. If, upon redemption, a holder would be entitled to receive a fractional interest in a share, the Company will round down to the nearest whole number of the number of shares of Class A-1 common stock to be issued to the holder.

Redemption procedures and cashless exercise. 
If the Company calls the Pace Warrants for redemption as described above, the Company’s management will have the option to require any holder that wishes to exercise his, her or its Pace Warrant to do so on a “cashless basis.” In determining whether to require all holders to exercise their Pace Warrants on a “cashless basis,” the Company’s management will consider, among other factors, its cash position, the number of Pace Warrants that are outstanding and the dilutive effect on the Company’s stockholders of issuing the maximum number of shares of Class A-1 common stock issuable upon the exercise of Pace Warrants. If the Company’s management takes advantage of this option, all holders of Pace Warrants would pay the exercise price by surrendering their Pace Warrants for that number of shares of Class A-1 common stock equal to the quotient obtained by dividing (x) the product of the number of shares of Class A-1 common stock underlying such Pace Warrants, multiplied by the excess of the “fair market value” (defined below) over the exercise price of such warrants by (y) the fair market value. The “fair market value” shall mean the average reported last sale price of the shares of Class A-1 common stock for the 10 trading days ending on the third trading day prior to the date on which the notice of redemption is sent to the holders of the Pace Warrants. If the Company’s management takes advantage of this option, the notice of redemption will contain the information necessary to calculate the number of shares of Class A-1 common stock to be received upon exercise of the Pace Warrants, including the “fair market value” in such case. Requiring a cashless exercise in this manner will reduce the number of shares to be issued and thereby lessen the dilutive effect of a warrant redemption. The Company believes this feature is an attractive option to it if the Company does not need the cash from the exercise of the Pace Warrants. If the Company calls the Pace Warrants for redemption and its management does not take advantage of this option, Initial Pace Sponsor and its permitted transferees would still be entitled to exercise their Pace Private Placement Warrants for cash or on a cashless basis using the same formula described above that other holders of Pace Warrants would have been required to use had all holders of Pace Warrants been required to exercise their warrants of Pace on a cashless basis, as described in more detail below.
A holder of a Pace Warrant may notify the Company in writing in the event it elects to be subject to a requirement that such holder will not have the right to exercise such Pace Warrant, to the extent that after giving effect to such exercise, such person (together with such person’s affiliates), to the warrant agent’s actual knowledge, would beneficially own in excess of 9.8% (or such other amount as a holder may specify) of the shares of Class A-1 common stock outstanding immediately after giving effect to such exercise.
If the number of outstanding shares of Class A-1 common stock is increased by a capitalization or share dividend payable in shares of Class A-1 common stock, or by a split-up of shares of Class A-1 common stock or other similar event, then, on the effective date of such share dividend, split-up or similar event, the number of shares of Class A-1 common stock issuable on exercise of each Pace Warrant will be increased in proportion to such increase in the outstanding shares of Class A-1 common stock. A rights offering to holders of shares of Class A-1 common stock entitling holders to purchase shares of Class A-1 common stock at a price less than the fair market value will be deemed a share dividend of a number of shares of Class A-1 common stock equal to the product of (i) the number of shares of Class A-1 common stock actually sold in such rights offering (or issuable under any other equity securities sold in such rights offering that are convertible into or exercisable for shares of Class A-1 common stock) multiplied by (ii) one (1) minus the quotient of (x) the price per share of Class A-1 common stock paid in such rights offering divided by (y) the fair market value. For these purposes (i) if the rights offering is for securities convertible into or exercisable for shares of Class A-1 common stock, in determining the price payable for shares of Class A-1 common stock, there will be taken into account any consideration received for such rights, as well as any additional amount payable upon exercise or conversion and (ii) fair market value means the volume weighted average price of shares of Class A-1 common stock as reported during the ten (10) trading day period ending on the trading day prior to the first date on which the shares of Class A-1 common stock trade on the applicable exchange or in the applicable market, regular way, without the right to receive such rights.
In addition, if the Company, at any time while the Pace Warrants are outstanding and unexpired, pay a dividend or make a distribution in cash, securities or other assets to the holders of shares of Class A-1 common stock on account of such shares of Class A-1 common stock (or other shares of the Company’s capital stock into which the Pace Warrants are convertible), other than (a) as described above or (b) certain ordinary cash dividends, then the warrant exercise price will be decreased, effective immediately after the effective date of such event, by the amount of cash and/or the fair market value of any securities or other assets paid on each share of Class A-1 common stock in respect of such event.
If the number of outstanding shares of Class A-1 common stock is decreased by a consolidation, combination, reverse share split or reclassification of shares of Class A-1 common stock or other similar event, then, on the effective date of such consolidation, combination, reverse share split, reclassification or similar event, the number of shares of Class A-1 common stock issuable on exercise of each warrant will be decreased in proportion to such decrease in outstanding shares of Class A-1 common stock.

Whenever the number of shares of Class A-1 common stock purchasable upon the exercise of the Pace Warrants is adjusted, as described above, the warrant exercise price will be adjusted by multiplying the warrant exercise price immediately prior to such adjustment by a fraction (x) the numerator of which will be the number of shares of Class A-1 common stock purchasable upon the exercise of the warrants of the Company immediately prior to such adjustment, and (y) the denominator of which will be the number of shares of Class A-1 common stock so purchasable immediately thereafter.
In case of any reclassification or reorganization of the outstanding shares of Class A-1 common stock (other than those described above or that solely affects the par value of such shares of Class A-1 common stock), or in the case of any merger or consolidation of the Company with or into another corporation (other than a consolidation or merger in which the Company is the continuing corporation and that does not result in any reclassification or reorganization of outstanding shares of Class A-1 common stock), or in the case of any sale or conveyance to another corporation or entity of the assets or other property of the Company as an entirety or substantially as an entirety in connection with which the Company is dissolved, the holders of the warrants will thereafter have the right to purchase and receive, upon the basis and upon the terms and conditions specified in the Pace Warrants and in lieu of the shares of Class A-1 common stock immediately theretofore purchasable and receivable upon the exercise of the rights represented thereby, the kind and amount of shares of stock or other securities or property (including cash) receivable upon such reclassification, reorganization, merger or consolidation, or upon a dissolution following any such sale or transfer, that the holder of the Pace Warrants would have received if such holder had exercised their Pace Warrants immediately prior to such event. However, if such holders were entitled to exercise a right of election as to the kind or amount of securities, cash or other assets receivable upon such consolidation or merger, then the kind and amount of securities, cash or other assets for which each Pace Warrant will become exercisable will be deemed to be the weighted average of the kind and amount received per share by such holders in such consolidation or merger that affirmatively make such election, and if a tender, exchange or redemption offer has been made to and accepted by such holders under circumstances in which, upon completion of such tender or exchange offer, the maker thereof, together with members of any group (within the meaning of Rule 13d-5(b)(1) under the Exchange Act) of which such maker is a part, and together with any affiliate or associate of such maker (within the meaning of Rule 12b-2 under the Exchange Act) and any members of any such group of which any such affiliate or associate is a part, own beneficially (within the meaning of Rule 13d-3 under the Exchange Act) more than 50% of the outstanding shares of Class A-1 common stock, the holder of a Pace Warrant will be entitled to receive the highest amount of cash, securities or other property to which such holder would actually have been entitled as a stockholder if such holder of Pace Warrants had exercised their Pace Warrant prior to the expiration of such tender or exchange offer, accepted such offer and all of the shares of Class A-1 common stock held by such holder had been purchased pursuant to such tender or exchange offer, subject to adjustment (from and after the consummation of such tender or exchange offer) as nearly equivalent as possible to the adjustments provided for in the Continental Warrant Agreement. Additionally, if less than 70% of the consideration receivable by the holders of ordinary shares in such a transaction is payable in the form of capital stock or shares in the successor entity that is listed for trading on a national securities exchange or is quoted in an established over-the-counter market, or is to be so listed for trading or quoted immediately following such event, and if the registered holder of the Pace Warrant properly exercises such Pace Warrant within thirty days following public disclosure of such transaction, the warrant exercise price will be reduced as specified in the Continental Warrant Agreement based on the per share consideration minus the Black-Scholes Warrant Value (as defined in the Continental Warrant Agreement) of such Pace Warrant.
The Pace Warrants were issued in registered form under the Continental Warrant Agreement. You should review a copy of the Continental Warrant Agreement, the form of which was filed as an exhibit to Pace’s registration statement on June 7, 2017, for a complete description of the terms and conditions applicable to the Pace Warrants. The Continental Warrant Agreement provides that the terms of the Pace Warrants may be amended without the consent of any holder to cure any ambiguity or correct any defective provision, but requires the approval by the holders of at least 50% of the then outstanding Pace Public Warrants to make any change that adversely affects the interests of the registered holders of Pace Public Warrants.
The Pace Warrants may be exercised upon surrender of the warrant certificate on or prior to the expiration date at the offices of the warrant agent, with the exercise form on the reverse side of the warrant certificate completed and executed as indicated, accompanied by full payment of the exercise price (or on a cashless basis, if applicable), by certified or official bank check payable to the Company, for the number of Pace Warrants being exercised. The holders of Pace Warrants do not have the rights or privileges of holders of shares of Class A-1 common stock and any voting rights until they exercise their warrants and receive shares of Class A-1 common stock. After the issuance of shares of Class A-1 common stock upon exercise of the Pace Warrants, each holder will be entitled to one vote for each share held of record on all matters to be voted on by stockholders.
 
Pace Private Placement Warrants.
The Pace Private Placement Warrants have terms and provisions that are identical to those of the Pace Public Warrants, except that:

		
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	The Pace Private Placement Warrants (including the shares of Class A-1 common stock issuable upon exercise of the Pace Private Placement Warrants) were subject to lock-up provisions that provided that the Pace Private Placement Warrants would not be transferable, assignable or salable until 30 days after the completion of an initial business combination and will not be redeemable, as applicable, so long as they are held by Initial Pace Sponsor or its permitted transferees, except that the Pace Private Placement Warrants (including the shares of Class A-1 common stock issuable upon exercise of the Pace Private Placement Warrants) can be transferred by such holders (a) to Pace’s officers or directors, any affiliates or family members of any of Pace’s officers or directors, members of Initial Pace Sponsor (which at the consummation of the Business Combination consisted of the certain affiliates of Pace), or any affiliates of Initial Pace Sponsor, (b) in the case of an individual, by gift to a member of the individual’s immediate family or to a trust, the beneficiary of which is a member of the individual’s immediate family, an affiliate of such person or to a charitable organization; (c) in the case of an individual, by virtue of laws of descent and distribution upon death of the 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 were originally purchased; (f) in the event of Pace’s liquidation prior to its completion of an initial business combination; (g) by virtue of the laws of the Cayman Islands or Initial Pace Sponsor’s limited liability company agreement upon dissolution of Initial Pace Sponsor; or (h) in the event of Pace’s liquidation, merger, share exchange, reorganization or other similar transaction which results in all of Pace’s stockholders having the right to exchange their Pace Public Shares for cash, securities or other property subsequent to Pace’s completion of an initial business combination; provided, however, that in the case of clauses (a) through (e) these permitted transferees must enter into a written agreement agreeing to be bound by these transfer restrictions.

		
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	If holders of the Pace Private Placement Warrants elect to exercise them on a cashless basis, they would pay the exercise price by surrendering their warrants for that number of shares of Class A-1 common stock equal to the quotient obtained by dividing (x) the product of the number of shares of Class A-1 common stock underlying the warrants, multiplied by the excess of the “fair market value” (defined below) over the exercise price of the warrants by (y) the fair market value. The “fair market value” shall mean the average reported last sale price of the shares of Class A-1 common stock for the 10 trading days ending on the third trading day prior to the date on which the notice of warrant exercise is sent to the warrant agent.

Business Combination Private Placement Warrants and Accel Public Warrants 
In connection with the consummation of the Business Combination, the Company and the Sellers that have received Business Combination Private Placement Warrants and Accel Public Warrants entered into that certain New Accel Warrant Agreement, pursuant to which the Company has issued to each such Seller who made a cash election with respect to less than 70% of its shares of common stock and preferred stock of Accel, its respective pro rata share of 2,444,444 newly issued warrants of the Company, with such pro rata share determined with reference to a number of shares equal to 70% of such Seller’s common stock and preferred stock of Accel less the number of shares in respect of which the Seller elected to receive cash in exchange for such shares. Each Accel Public Warrant and Business Combination Private Placement Warrant entitles the holder to purchase one share of Class A-1 common stock at an exercise price of $11.50 per share, subject to adjustments substantially similar to those applicable to the other outstanding Accel Warrants, at any time 30 days after the consummation of the Business Combination. The Business Combination Private Placement Warrants and Accel Public Warrants have terms and provisions that are identical to those of the Pace Public Warrants, except:
		
	•
	The Business Combination Private Placement Warrants and Accel Public Warrants will expire five years after the consummation of the Business Combination, at 5:00 p.m., New York City time, or earlier upon redemption or liquidation. 

		
	•
	The Business Combination Private Placement Warrants and Accel Public Warrants (including the shares of Class A-1 common stock issuable upon exercise thereof) are subject to lock-up provisions that provide that so long as such warrants are held by a Seller receiving Business Combination Private Placement Warrants and/or Accel Public Warrants in connection with the Business Combination or its permitted transferees, such securities are not transferable, assignable or salable until 30 days after the consummation of the Business Combination and will not be redeemable, except that such warrants (including the shares of Class A-1 common stock issuable upon exercise thereof) may be transferred by such holders (a) to the Company’s officers or directors, any affiliates or family members of any of the Company’s officers or directors, any members of the Accel holder, or any affiliates of the Accel holder, (b) in the case of an individual, by gift to a member of the individual’s immediate family or to a trust, the beneficiary of which is a member of the individual’s immediate family, an affiliate of such person or to a charitable organization; (c) in the case of an individual, by virtue of laws of descent and distribution upon death of the individual; (d) in the case of an individual, pursuant to a qualified domestic relations order; (e) in the event of the Company’s liquidation, merger, share exchange, reorganization or other similar transaction which results in all of the Company’s stockholders having the right to exchange their Pace Public Shares for cash, securities or other property subsequent to the completion of the Business Combination; provided, however, 

that in the case of clauses (a) through (d) these permitted transferees must enter into a written agreement agreeing to be bound by these transfer restrictions. 
		
	•
	If holders of the Business Combination Private Placement Warrants and/or Accel Public Warrants elect to exercise them on a cashless basis, they would pay the exercise price by surrendering their warrants for that number of shares of Class A-1 common stock equal to the quotient obtained by dividing (x) the product of the number of shares of Class A-1 common stock underlying the warrants, multiplied by the excess of the “fair market value” (defined below) over the exercise price of the warrants by (y) the fair market value. The “fair market value” shall mean the average reported last sale price of the shares of Class A-1 common stock for the 10 trading days ending on the third trading day prior to the date on which the notice of warrant exercise is sent to the warrant agent. 

		
	•
	The Business Combination Private Placement Warrants and Accel Public Warrants may not be exercised if (a) prior to giving effect to the exercise, the holder such warrant beneficially owns less than 4.99% of the total number of shares of Class A-1 common stock issued and outstanding at such time and (b) after giving effect to such exercise, the holder of such warrant would beneficially own in excess of 4.99% of the total shares of Class A-1 common stock issued and outstanding at such time. However, notwithstanding the foregoing limitation, the Business Combination Private Placement Warrants and Accel Public Warrants held by a holder that has obtained all required gaming approvals from applicable gaming authorities permitting such holder to beneficially own shares of Class A-1 common stock in an amount in excess of 4.99% of the total number of shares of Class A-1 common stock issued and outstanding at such time shall immediately be exercisable without regard to such limitation.

The Business Combination Private Placement Warrants and Accel Public Warrants were issued under a warrant agreement entered into in connection with the Business Combination, by and between Pace and Continental Stock Transfer & Trust Company as warrant agent (the “New Continental Warrant Agreement”). You should review a copy of the New Continental Warrant Agreement for a complete description of the terms and conditions applicable to the Business Combination Private Placement Warrants and Accel Public Warrants. 
Exchange Listing 
Our Class A-1 common stock is listed on the New York Stock Exchange under the symbol “ACEL.” Our warrants are listed on the New York Stock Exchange under the symbol “ACEL-WS.” 
Transfer Agent and Registrar 
The transfer agent and registrar for our common stock is Continental Stock Transfer & Trust Company.

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