Document:

Document

Exhibit 4(a)

March 11, 2021

Company Order and Officers’ Certificate
2.70% Senior Notes, Series AA, due 2031

The Bank of New York Mellon Trust Company, N.A., as Trustee
2 North LaSalle Street
Chicago, Illinois 60602

Ladies and Gentlemen:

Pursuant to Article Two of the Indenture, dated as of January 1, 1998 (as it may be amended or supplemented, the “Indenture”), from Appalachian Power Company (the “Company”) to The Bank of New York Mellon Trust Company, N.A., as successor to The Bank of New York, as trustee (the “Trustee”), and the Board Resolutions dated October 28, 2019, copies of which certified by the Secretary or an Assistant Secretary of the Company are being delivered herewith under Section 2.01 of the Indenture, and unless otherwise provided in a subsequent Company Order pursuant to Section 2.04 of the Indenture,

1.    The Company’s 2.70% Senior Notes, Series AA, due 2031 (the “Notes”) are hereby established.  The Notes shall be in substantially the form attached hereto as Exhibit 1. 

2.    The terms and characteristics of the Notes shall be as follows (the numbered clauses set forth below corresponding to the numbered subsections of Section 2.01 of the Indenture, with terms used and not defined herein having the meanings specified in the Indenture):

(i)    The aggregate principal amount of Notes which may be authenticated and delivered under the Indenture shall be limited to $400,000,000 for the Notes, except as contemplated in Section 2.01(i) of the Indenture and except that such principal amount may be increased from time to time; all Notes need not be issued at the same time and the series may be reopened at any time, without the consent of any securityholder, for issuance of additional Notes, which Notes will have the same interest rate, maturity and other terms as those initially issued (other than the date of issuance, the issue price and, in some circumstances, the initial interest accrual date and the initial interest payment date);

(ii)    The date on which the principal of the Notes shall be payable shall be April 1, 2031;

(iii)    Interest shall accrue from the date of authentication of the Notes; the Interest Payment Dates on which such interest will be payable shall be April 1 and October 1, and the Regular Record Date for the determination of holders to whom interest is payable on any such Interest Payment Date shall be the March 15 or September 15, respectively; provided that the first Interest Payment Date shall be October 1, 2021 and interest payable on the Stated Maturity Date of the Notes or any Redemption Date shall be paid to the Person to whom principal shall be paid;

(iv)    The interest rate at which the Notes shall bear interest shall be 2.70% per annum;

(v)    The Notes may be redeemed by the Company at its option, in whole at any time or in part from time to time, upon not less than thirty but not more than sixty days’ prior notice (either by mail or in compliance with the applicable procedures of DTC).  At any time prior to January 1, 2031 (three months prior to the maturity date (the “Par Call Date”)), the Company may redeem the Notes either as a whole or in part at a redemption price (calculated by the Independent Investment Banker) equal to the greater of (1) 100% of the principal amount of the Notes  being redeemed and (2) the sum of the present values of the remaining scheduled payments of principal and interest on the Notes being redeemed that would be due if such Notes matured on the Par Call Date (excluding the portion of any such interest accrued to but excluding the date of  redemption), discounted (for purposes of determining present value) to the redemption date on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) at the Treasury Rate (as defined below) plus 20 basis points, plus, in each case, accrued and unpaid interest thereon to but excluding the date of redemption.

At any time on or after the Par Call Date the Company may redeem the Notes in whole or in part at 100% of the principal amount of the Notes being redeemed, plus accrued and unpaid interest thereon to but excluding the date of redemption.

“Comparable Treasury Issue” means the United States Treasury security selected by an Independent Investment Banker as having a maturity comparable to the remaining term (“remaining life”) of the Notes (assuming, for this purpose, that the Notes matured on the Par Call Date) that would be utilized, at the time of selection and in accordance with customary financial practice, in pricing new issues of corporate debt securities of comparable maturity to the remaining life of the Notes.

“Comparable Treasury Price” means, with respect to any redemption date, (1) the average of the Reference Treasury Dealer Quotations for such redemption date, after excluding the highest and lowest of such Reference Treasury Dealer Quotations, or (2) if the Company obtains fewer than four of such Reference Treasury Dealer Quotations, the average of all such quotations.

“Independent Investment Banker” means one of the Reference Treasury Dealers appointed by the Company and notified by the Company to the Trustee.

“Reference Treasury Dealer” means a primary U.S. Government securities dealer or dealers selected by the Company and notified by the Company to the Trustee.

“Reference Treasury Dealer Quotations” means, with respect to each Reference Treasury Dealer and any redemption date, the average, as determined by the Company and notified to the Trustee, of the bid and asked prices for the Comparable Treasury Issue (expressed in each case as a percentage of its principal amount) quoted in writing to the Company and the Trustee by such Reference Treasury Dealer at or before 3:30 p.m., New York City time, on the third Business Day preceding such redemption date.
    
“Treasury Rate” means, with respect to any redemption, the rate per annum equal to the semi-annual equivalent yield to maturity of the Comparable Treasury Issue, calculated by the Independent Investment Banker using a price for the Comparable Treasury Issue (expressed as a percentage of its principal amount) equal to the Comparable Treasury Price for such redemption date.

(vi)     (a) the Notes  shall be issued in the form of a Global Note; (b) the Depositary for the Global Note shall be The Depository Trust Company; and (c) the procedures with respect to 
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transfer and exchange of Global Notes shall be as set forth in the form of the Note attached hereto;

(vii)    the title of the Notes shall be "2.70% Senior Notes, Series AA, due 2031”;

(viii)    the forms of the Notes shall be as set forth in Paragraph 1, above;

(ix)    not applicable;

(x)    the Notes may be subject to a Periodic Offering;

(xi)    not applicable;

(xii)    not applicable;

(xiii)    not applicable;

(xiv)    the Notes shall be issuable in minimum denominations of $2,000 and integral multiples of $1,000 in excess thereof;

(xv)    not applicable;

(xvi)    the Notes shall not be issued as Discount Securities;

(xvii)    not applicable;

(xviii)    not applicable; 

(xix)    Limitations on Liens:

So long as any of the Notes are outstanding, the Company will not create or suffer to be created or to exist any mortgage, pledge, security interest, or other lien (collectively, “Liens”) on any of the Company’s utility properties or tangible assets now owned or hereafter acquired to secure any indebtedness for borrowed money (“Secured Debt”), without providing that such Notes will be similarly secured.  This restriction does not apply to the Company’s subsidiaries, nor will it prevent any of them from creating or permitting to exist Liens on their property or assets to secure any Secured Debt.  In addition, this restriction does not prevent the creation or existence of:

•Liens on property existing at the time of acquisition or construction of such property (or created within one year after completion of such acquisition or construction), whether by purchase, merger, construction or otherwise, or to secure the payment of all or any part of the purchase price or construction cost thereof, including the extension of any Liens to repairs, renewals, replacements substitutions, betterments, additions, extensions and improvements then or thereafter made on the property subject thereto; 

•Financing of the Company’s accounts receivable for electric service; 

•Any extensions, renewals or replacements (or successive extensions, renewals or replacements), in whole or in part, of liens permitted by the foregoing clauses; and

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•The pledge of any bonds or other securities at any time issued under any of the Secured Debt permitted by the above clauses.

In addition to the permitted issuances above, Secured Debt not otherwise so permitted may be issued in an amount that does not exceed 15% of Net Tangible Assets as defined below.  

“Net Tangible Assets” means the total of all assets (including revaluations thereof as a result of commercial appraisals, price level restatement or otherwise) appearing on the Company’s balance sheet, net of applicable reserves and deductions, but excluding goodwill, trade names, trademarks, patents, unamortized debt discount and all other like intangible assets (which term shall not be construed to include such revaluations), less the aggregate of the Company’s current liabilities appearing on such balance sheet.  For purposes of this definition, the Company's balance sheet does not include assets and liabilities of the Company’s subsidiaries.

This restriction also will not apply to or prevent the creation or existence of leases made, or existing on property acquired, in the ordinary course of business; and

(xx)    Certain Tax Information.

In order to comply with applicable tax laws (inclusive of rules, regulations and interpretations promulgated by competent authorities) related to the Indenture, this Company Order and Officers’ Certificate and the Notes in effect from time to time (“Applicable Law”) that a foreign financial institution, issuer, trustee, paying agent or other party is or has agreed to be subject to, the Company agrees (i) to provide to the Trustee sufficient information about the parties and/or transactions (including any modification to the terms of such transactions) so the Trustee can determine whether it has tax related obligations under Applicable Law and (ii) that the Trustee shall be entitled to make any withholding or deduction from payments to the extent necessary to comply with Applicable Law for which the Trustee shall not have any liability.

3.    You are hereby requested to authenticate $400,000,000 aggregate principal amount of 2.70% Senior Notes, Series AA, due 2031 executed by the Company and delivered to you concurrently with this Company Order and Officers’ Certificate, in the manner provided by the Indenture.

4.    You are hereby requested to hold the Notes as custodian for DTC in accordance with the Blanket Issuer Letter of Representations dated June 24, 2004, from the Company to DTC.

5.    Concurrently with this Company Order and Officers’ Certificate, an Opinion of Counsel under Sections 2.04 and 13.06 of the Indenture is being delivered to you.

6.    The undersigned, Renee V. Hawkins and William E. Johnson, the Assistant Treasurer and Assistant Secretary, respectively, of the Company do hereby certify that:

(i)The form and terms of the Notes have been established in conformity with the provisions of the Indenture;

(ii)    We have read the relevant portions of the Indenture, including without limitation the conditions precedent provided for therein relating to the action proposed to be taken by the Trustee as requested in this Company Order and Officers’ Certificate, and the definitions in the Indenture relating thereto;
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(iii)    We have read the Board Resolutions of the Company and the Opinion of Counsel referred to above;

(iv)    We have conferred with other officers of the Company, have examined such records of the Company and have made such other investigation as we deemed relevant for purposes of this certificate;

(v)    In our opinion, we have made such examination or investigation as is necessary to enable us to express an informed opinion as to whether or not such conditions have been complied with; and 

(vi)    On the basis of the foregoing, we are of the opinion that all conditions precedent provided for in the Indenture relating to the action proposed to be taken by the Trustee as requested herein have been complied with.

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Kindly acknowledge receipt of this Company Order and Officers’ Certificate, including the documents listed herein, and confirm the arrangements set forth herein by signing and returning the copy of this document attached hereto.

Very truly yours,

APPALACHIAN POWER COMPANY

									
	By:		/s/ Renee V. Hawkins
			Renee V. Hawkins
			Assistant Treasurer
			
			
	And:		/s/ William E. Johnson
			William E. Johnson
			Assistant Secretary
			
			
	Acknowledged by Trustee:
			
			
	By:		/s/ Valere Boyd
			Authorized Signatory
			

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Exhibit 1

Unless this certificate is presented by an authorized representative of The Depository Trust Company (55 Water Street, New York, New York) to the issuer or its agent for registration of transfer, exchange or payment, and any certificate to be issued is registered in the name of Cede & Co. or in such other name as is requested by an authorized representative of The Depository Trust Company and any payment is made to Cede & Co., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest herein.  Except as otherwise provided in Section 2.11 of the Indenture, this Security may be transferred, in whole but not in part, only to another nominee of the Depository or to a successor Depository or to a nominee of such successor Depository.

No.   R-1

APPALACHIAN POWER COMPANY
2.70% Senior Notes, Series AA, due 2031

												
	CUSIP: 037735 CZ8	Original Issue Date:  March 11, 2021
				
	Stated Maturity:  April 1, 2031	Interest Rate:  2.70%
				
	Principal Amount:  $400,000,000	
				
	Redeemable:	Yes  þ
	No  o
	
	In Whole:	Yes  þ
	No  o
	
	In Part:    
	Yes  þ
	No  o
	

APPALACHIAN POWER COMPANY, a corporation duly organized and existing under the laws of the Commonwealth of Virginia (herein referred to as the “Company”, which term includes any successor corporation under the Indenture hereinafter referred to), for value received, hereby promises to pay to CEDE & CO. or registered assigns, the Principal Amount specified above on the Stated Maturity specified above, and to pay interest on said Principal Amount from the Original Issue Date specified above or from the most recent interest payment date (each such date, an “Interest Payment Date”) to which interest has been paid or duly provided for, semi-annually in arrears on April 1 and October 1 in each year, commencing on October 1, 2021, at the Interest Rate per annum specified above, until the Principal Amount shall have been paid or duly provided for.  Interest shall be computed on the basis of a 360-day year of twelve 30-day months.

The interest so payable, and punctually paid or duly provided for, on any Interest Payment Date, as provided in the Indenture, as hereinafter defined, shall be paid to the Person in whose name this Note (or one or more Predecessor Securities) shall have been registered at the close of business on the Regular Record Date with respect to such Interest Payment Date, which shall be the March 15 or September 15 (whether or not a Business Day) prior to such Interest Payment Date, provided that interest payable on the Stated Maturity or any redemption date shall be paid to the Person to whom principal is paid.  Any such interest not so punctually paid or duly provided for shall forthwith cease to be payable to the Holder on such Regular Record Date and shall be paid as provided in said Indenture.

If any Interest Payment Date, any redemption date or Stated Maturity is not a Business Day, then 

payment of the amounts due on this Note on such date will be made on the next succeeding Business Day, and no interest shall accrue on such amounts for the period from and after such Interest Payment Date, redemption date or Stated Maturity, as the case may be, with the same force and effect as if made on such date. The principal of (and premium, if any) and the interest on this Note shall be payable at the office or agency of the Company maintained for that purpose in the Borough of Manhattan, The City of New York, New York, in any coin or currency of the United States of America which at the time of payment is legal tender for payment of public and private debts; provided, however, that payment of interest (other than interest payable on the Stated Maturity or any redemption date) may be made at the option of the Company by check mailed to the registered holder at such address as shall appear in the Security Register.

This Note is one of a duly authorized series of Notes of the Company (herein sometimes referred to as the “Notes”), specified in the Indenture, all issued or to be issued in one or more series under and pursuant to an Indenture dated as of January 1, 1998 duly executed and delivered between the Company and The Bank of New York Mellon Trust Company, N.A., a national banking association formed under the laws of the United States, as successor to The Bank of New York, as Trustee (herein referred to as the “Trustee”) (such Indenture, as originally executed and delivered and as thereafter supplemented and amended being hereinafter referred to as the “Indenture”), to which Indenture and all indentures supplemental thereto or Company Orders reference is hereby made for a description of the rights, limitations of rights, obligations, duties and immunities thereunder of the Trustee, the Company and the holders of the Notes.  By the terms of the Indenture, the Notes are issuable in series which may vary as to amount, date of maturity, rate of interest and in other respects as in the Indenture provided.  This Note is one of the series of Notes designated on the face hereof.

The Notes may be redeemed by the Company at its option, in whole at any time or in part from time to time, upon not less than thirty but not more than sixty days’ prior notice (either by mail or in compliance with the applicable procedures of DTC).

At any time prior to January 1, 2031 (three months prior to the maturity date (the “Par Call Date”)), the Company may redeem this Note either as a whole or in part at a redemption price (calculated by the Independent Investment Banker) equal to the greater of (1) 100% of the principal amount of the Notes  being redeemed and (2) the sum of the present values of the remaining scheduled payments of principal and interest on the Notes being redeemed that would be due if such Notes matured on the Par Call Date (excluding the portion of any such interest accrued to but excluding the date of  redemption), discounted (for purposes of determining present value) to the redemption date on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) at the Treasury Rate (as defined below) plus 20 basis points, plus, in each case, accrued and unpaid interest thereon to but excluding the date of redemption.

At any time on or after the Par Call Date the Company may redeem this Note in whole or in part at 100% of the principal amount of the Notes being redeemed, plus accrued and unpaid interest thereon to but excluding the date of redemption.
    
“Comparable Treasury Issue” means the United States Treasury security selected by an Independent Investment Banker as having a maturity comparable to the remaining term (“remaining life”) of the Notes (assuming, for this purpose, that the Notes being redeemed matured on the Par Call Date) that would be utilized, at the time of selection and in accordance with customary financial practice, in pricing new issues of corporate debt securities of comparable maturity to the remaining life of the Notes.

“Comparable Treasury Price” means, with respect to any redemption date, (1) the average of the 
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Reference Treasury Dealer Quotations for such redemption date, after excluding the highest and lowest of such Reference Treasury Dealer Quotations, or (2) if the Company obtains fewer than four of such Reference Treasury Dealer Quotations, the average of all such quotations.

“Independent Investment Banker” means one of the Reference Treasury Dealers appointed by the Company and notified by the Company to the Trustee.

“Reference Treasury Dealer” means a primary U.S. Government securities dealer or dealers selected by the Company and notified by the Company to the Trustee.

“Reference Treasury Dealer Quotations” means, with respect to each Reference Treasury Dealer and any redemption date, the average, as determined by the Company and notified to the Trustee, of the bid and asked prices for the Comparable Treasury Issue (expressed in each case as a percentage of its principal amount) quoted in writing to the Company and the Trustee by such Reference Treasury Dealer at or before 3:30 p.m., New York City time, on the third Business Day preceding such redemption date.
    
“Treasury Rate” means, with respect to any redemption, the rate per annum equal to the semi-annual equivalent yield to maturity of the Comparable Treasury Issue, calculated by the Independent Investment Banker using a price for the Comparable Treasury Issue (expressed as a percentage of its principal amount) equal to the Comparable Treasury Price for such redemption date.

The Company shall not be required to (i) issue, exchange or register the transfer of any Notes during a period beginning at the opening of business 15 days before the day of the mailing of a notice of redemption of less than all the outstanding Notes of the same series and ending at the close of business on the day of such mailing, nor (ii) register the transfer of or exchange of any Notes of any series or portions thereof called for redemption.  This Global Note is exchangeable for Notes in definitive registered form only under certain limited circumstances set forth in the Indenture.

In the event of redemption of this Note in part only, a new Note or Notes of this series, of like tenor, for the unredeemed portion hereof will be issued in the name of the Holder hereof upon the surrender of this Note.

In case an Event of Default, as defined in the Indenture, shall have occurred and be continuing, the principal of all of the Notes may be declared, and upon such declaration shall become, due and payable, in the manner, with the effect and subject to the conditions provided in the Indenture.

The Indenture contains provisions for defeasance at any time of the entire indebtedness of this Note upon compliance by the Company with certain conditions set forth therein.
    
As described in the Company Order and Officers’ Certificate, the Company is subject to a covenant regarding making certain tax information available to the Trustee and, so long as this Note is outstanding, the Company is subject to a limitation on Liens, in each case as described therein.

The Indenture contains provisions permitting the Company and the Trustee, with the consent of the Holders of not less than a majority in aggregate principal amount of the Notes of each series affected at the time outstanding, as defined in the Indenture, to execute supplemental indentures for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of the Indenture or of any supplemental indenture or of modifying in any manner the rights of the Holders of the Notes; provided, however, that no such supplemental indenture shall (i) extend the fixed maturity of any Notes of 
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any series, or reduce the principal amount thereof, or reduce the rate or extend the time of payment of interest thereon, or reduce any premium payable upon the redemption thereof, or reduce the amount of the principal of a Discount Security that would be due and payable upon a declaration of acceleration of the maturity thereof pursuant to the Indenture, without the consent of the holder of each Note then outstanding and affected; (ii) reduce the aforesaid percentage of Notes, the holders of which are required to consent to any such supplemental indenture, or reduce the percentage of Notes, the holders of which are required to waive any default and its consequences, without the consent of the holder of each Note then outstanding and affected thereby; or (iii) modify any provision of Section 6.01(c) of the Indenture (except to increase the percentage of principal amount of securities required to rescind and annul any declaration of amounts due and payable under the Notes), without the consent of the holder of each Note then outstanding and affected thereby.  The Indenture also contains provisions permitting the Holders of a majority in aggregate principal amount of the Notes of all series at the time outstanding affected thereby, on behalf of the Holders of the Notes of such series, to waive any past default in the performance of any of the covenants contained in the Indenture, or established pursuant to the Indenture with respect to such series, and its consequences, except a default in the payment of the principal of or premium, if any, or interest on any of the Notes of such series.  Any such consent or waiver by the registered Holder of this Note (unless revoked as pro-vided in the Indenture) shall be conclusive and binding upon such Holder and upon all future Holders and owners of this Note and of any Note issued in exchange herefor or in place hereof (whether by registration of transfer or otherwise), irrespective of whether or not any notation of such consent or waiver is made upon this Note.

No reference herein to the Indenture and no provision of this Note or of the Indenture shall alter or impair the obligation of the Company, which is absolute and unconditional, to pay the principal of and premium, if any, and interest on this Note at the time and place and at the rate and in the money herein prescribed.

As provided in the Indenture and subject to certain limitations therein set forth, this Note is transferable by the registered holder hereof on the Security Register of the Company, upon surrender of this Note for registration of transfer at the office or agency of the Company as may be designated by the Company accompanied by a written instrument or instruments of transfer in form satisfactory to the Company or the Trustee duly executed by the registered Holder hereof or his or her attorney duly authorized in writing, and thereupon one or more new Notes of authorized denominations and for the same aggregate principal amount and series will be issued to the designated transferee or transferees.  No service charge will be made for any such transfer, but the Company may require payment of a sum sufficient to cover any tax or other governmental charge payable in relation thereto.

Prior to due presentment for registration of transfer of this Note, the Company, the Trustee, any paying agent and any Security Registrar may deem and treat the registered Holder hereof as the absolute owner hereof (whether or not this Note shall be overdue and notwithstanding any notice of ownership or writing hereon made by anyone other than the Security Registrar) for the purpose of receiving payment of or on account of the principal hereof and premium, if any, and interest due hereon and for all other purposes, and neither the Company nor the Trustee nor any paying agent nor any Security Registrar shall be affected by any notice to the contrary.

No recourse shall be had for the payment of the principal of or the interest on this Note, or for any claim based hereon, or otherwise in respect hereof, or based on or in respect of the Indenture, against any incorporator, stockholder, officer or director, past, present or future, as such, of the Company or of any predecessor or successor corporation, whether by virtue of any constitution, statute or rule of law, or by the enforcement of any assessment or penalty or otherwise, all such liability being, by the acceptance 
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hereof and as part of the consideration for the issuance hereof, expressly waived and released.

The Notes of this series are issuable only in registered form without coupons in denominations of $2,000 and any integral multiples of $1,000 in excess thereof.  As provided in the Indenture and subject to certain limitations, Notes of this series are exchangeable for a like aggregate principal amount of Notes of this series of the same authorized denomination, as requested by the Holder surrendering the same.

All terms used in this Note which are defined in the Indenture shall have the meanings assigned to them in the Indenture.

This Note shall not be entitled to any benefit under the Indenture hereinafter referred to, be valid or become obligatory for any purpose until the Certificate of Authentication hereon shall have been signed by or on behalf of the Trustee.

    
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IN WITNESS WHEREOF, the Company has caused this Instrument to be executed.

APPALACHIAN POWER COMPANY

						
	By:	
		Renee V. Hawkins
		Assistant Treasurer

                    
Attest:

						
	By:	
		William E. Johnson
		Assistant Secretary

    
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CERTIFICATE OF AUTHENTICATION

    This is one of the Notes of the series of Notes designated in accordance with, and referred to in, the within‐mentioned Indenture.

Dated: 

THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A.

						
	By:	
		Authorized Signatory

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    FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto

(PLEASE INSERT SOCIAL SECURITY OR OTHER
 IDENTIFYING NUMBER OF ASSIGNEE)

_______________________________________

________________________________________________________________

________________________________________________________________
(PLEASE PRINT OR TYPE NAME AND ADDRESS, INCLUDING ZIP CODE, OF
________________________________________________________________
ASSIGNEE) the within Note and all rights thereunder, hereby
________________________________________________________________
irrevocably constituting and appointing such person attorney to 
________________________________________________________________
transfer such Note on the books of the Issuer, with full
________________________________________________________________
power of substitution in the premises.

Dated:________________________        _________________________

NOTICE:    The signature to this assignment must correspond with the name as written upon the face of the within Note in every particular, without alteration or enlargement or any change whatever and NOTICE:  Signature(s) must be guaranteed by a financial institution that is a member of the Securities Transfer Agents Medallion Program (“STAMP”), the Stock Exchange Medallion Program (“SEMP”) or the New York Stock Exchange, Inc. Medallion Signature Program (“MSP”).

8Exhibit
4.2

 

DESCRIPTION
OF SECURITIES

 

As
of December 31, 2020, ACE Convergence Acquisition Corp. (“we,” “our,” “us” or the “company”)
had the following three classes of securities registered under Section 12 of the Securities Exchange Act of 1934, as amended
(the “Exchange Act”): (i) its units, each consisting of one Class A ordinary share and one-half of
one redeemable warrant, (ii) Class A ordinary shares, par value $0.0001 per share, and (iii) redeemable warrants,
each whole warrant exercisable for one Class A ordinary share at an exercise price of $11.50. In addition, this Description
of Securities also references the company’s Class B ordinary shares, par value $0.0001 per share (the “Class B
ordinary shares” or “founder shares”), which are not registered pursuant to Section 12 of the Exchange Act
but are convertible into Class A ordinary shares. The description of the Class B ordinary shares is included to assist
in the description of the Class A ordinary shares. Unless the context otherwise requires, references to our “sponsor”
are to ACE Convergence Acquisition LLC and references to our “initial shareholders” are to our sponsor and certain
members of our management team, as they held our founder shares prior to our initial public offering (our “IPO”).

 

We are a Cayman Islands
exempted company and our affairs will be governed by our amended and restated memorandum and articles of association, the Companies
Law and common law of the Cayman Islands. Pursuant to our amended and restated memorandum and articles of association, we are authorized
to issue 500,000,000 Class A ordinary shares, $0.0001 par value each, 50,000,000 Class B ordinary shares, $0.0001 par
value each, and 5,000,000 undesignated preference shares, $0.0001 par value each. The following description summarizes the material
terms of our shares as set out more particularly in our amended and restated memorandum and articles of association. Because it
is only a summary, it may not contain all the information that is important to you.

 

Units

 

Each unit has an offering
price of $10.00 and consists of one Class A ordinary share and one-half of one redeemable warrant. Each whole warrant entitles
the holder thereof to purchase one Class A ordinary share at a price of $11.50 per share, subject to adjustment as described
in this prospectus. Pursuant to the warrant agreement, a warrant holder may exercise its warrants only for a whole number of the
company’s Class A ordinary shares. This means only a whole warrant may be exercised at any given time by a warrant holder.

 

The Class A ordinary
shares and warrants constituting the units will begin separate trading on the 52nd day following the date of this prospectus (or,
if such date is not a business day, the following business day) unless Cantor Fitzgerald & Co. informs us of its decision
to allow earlier separate trading, subject to our having filed the Current Report on Form 8-K described below and having
issued a press release announcing when such separate trading will begin. Once the Class A ordinary shares and warrants commence
separate trading, holders will have the option to continue to hold units or separate their units into the component securities.
Holders will need to have their brokers contact our transfer agent in order to separate the units into Class A ordinary shares
and warrants. Additionally, the units will automatically separate into their component parts and will not be traded after completion
of our initial business combination. No fractional warrants will be issued upon separation of the units and only whole warrants
will trade. Accordingly, unless you purchase at least two units, you will not be able to receive or trade a whole warrant.

 

     

     

    

 

Ordinary Shares

 

Class A ordinary
shareholders and Class B ordinary shareholders of record are entitled to one vote for each share held on all matters to be
voted on by shareholders and vote together as a single class, except as required by law. Unless specified in the Companies Law,
our amended and restated memorandum and articles of association or applicable stock exchange rules, the affirmative vote of a majority
of our ordinary shares that are voted is required to approve any such matter voted on by our shareholders. Approval of certain
actions will require a special resolution under Cayman Islands law and pursuant to our amended and restated memorandum and articles
of association; such actions include amending our amended and restated memorandum and articles of association and approving a statutory
merger or consolidation with another company. Directors are appointed for a term of two years. There is no cumulative voting with
respect to the appointment of directors, with the result that the holders of more than 50% of the ordinary shares voted for the
appointment of directors can appoint all of the directors prior to our initial business combination. Our shareholders are entitled
to receive dividends when, as and if declared by the board of directors out of funds legally available therefor.

 

Because our amended
and restated memorandum and articles of association authorize the issuance of up to 500,000,000 Class A ordinary shares, if
we were to enter into a business combination, we may (depending on the terms of such a business combination) be required to increase
the number of Class A ordinary shares which we are authorized to issue at the same time as our shareholders vote on the business
combination to the extent we seek shareholder approval in connection with our initial business combination.

 

In accordance with
Nasdaq corporate governance requirements, we are not required to hold an annual general meeting until one year after our fiscal
year end following our listing on Nasdaq. There is no requirement under the Companies Law for us to hold annual or extraordinary
general meetings to appoint directors. We may not hold an annual general meeting prior to the consummation of our initial business
combination.

 

We will provide our
public shareholders with the opportunity to redeem all or a portion of their public shares upon the completion of our initial business
combination at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account calculated
as of two business days prior to the consummation of our initial business combination, including interest (which interest shall
be net of taxes payable), divided by the number of then issued and outstanding public shares, subject to the limitations described
herein. The amount in the trust account is initially anticipated to be $10.00 per public share. The per-share amount we will distribute
to investors who properly redeem their shares will not be reduced by the deferred underwriting commissions we will pay to the underwriters.
The redemption rights will include the requirement that a beneficial owner must identify itself in order to validly redeem its
shares. Our initial shareholders, directors and officers have entered into a letter agreement with us, pursuant to which they have
agreed to waive their redemption rights with respect to any founder shares and public shares held by them in connection with the
completion of our initial business combination or certain amendments to our amended and restated memorandum and articles of association
as described elsewhere in this prospectus. Permitted transferees of our initial shareholders, directors or officers will be subject
to the same obligations.

 

Unlike some blank check
companies that hold shareholder votes and conduct proxy solicitations in conjunction with their initial business combinations and
provide for related redemptions of public shares for cash upon completion of such initial business combinations even when a vote
is not required by applicable law or stock exchange listing requirements, if a shareholder vote is not required by applicable law
or stock exchange listing requirements and we do not decide to hold a shareholder vote for business or other reasons, we will,
pursuant to our amended and restated memorandum and articles of association, conduct the redemptions pursuant to the tender offer
rules of the SEC, and file tender offer documents with the SEC prior to completing our initial business combination. Our amended
and restated memorandum and articles of association require these tender offer documents to contain substantially the same financial
and other information about the initial business combination and the redemption rights as is required under the SEC’s proxy
rules. If, however, a shareholder approval of the transaction is required by applicable law or stock exchange listing requirements,
or we decide to obtain shareholder approval for business or other reasons, we will, like some blank check companies, offer to redeem
shares in conjunction with a proxy solicitation pursuant to the proxy rules and not pursuant to the tender offer rules. If
we seek shareholder approval, we will complete our initial business combination only if we receive an ordinary resolution under
Cayman Islands law, which requires the affirmative vote of holders of a majority of ordinary shares who attend and vote in person
or by proxy at a general meeting of the company. However, the participation of our sponsor, directors, officers, advisors or any
of their respective affiliates in privately-negotiated transactions (as described in this prospectus), if any, could result in
the approval of our initial business combination even if a majority of our public shareholders vote, or indicate their intention
to vote, against such business combination. For purposes of seeking approval of the majority of our issued and outstanding ordinary
shares, non-votes will have no effect on the approval of our initial business combination once a quorum is obtained. We intend
to give not less than 10 days nor more than 60 days prior written notice of any such meeting, if required, at which a vote shall
be taken to approve our initial business combination. These quorum and voting thresholds, and the voting agreements of our initial
shareholders, may make it more likely that we will consummate our initial business combination.

 

    2

     

    

 

If we seek shareholder
approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination
pursuant to the tender offer rules, our amended and restated memorandum and articles of association provide that a public shareholder,
together with any affiliate of such shareholder or any other person with whom such shareholder is acting in concert or as a “group”
(as defined under Section 13 of the Exchange Act), will be restricted from redeeming its shares with respect to more than
an aggregate of 15% of the ordinary shares sold in our IPO, which we refer to as the “Excess Shares,” without our prior
consent. However, we would not be restricting our shareholders’ ability to vote all of their shares (including Excess Shares)
for or against our initial business combination. Our shareholders’ inability to redeem the Excess Shares will reduce their
influence over our ability to complete our initial business combination, and such shareholders could suffer a material loss in
their investment if they sell such Excess Shares on the open market. Additionally, such shareholders will not receive redemption
distributions with respect to the Excess Shares if we complete the business combination. As a result, such shareholders will continue
to hold that number of shares exceeding 15% and, in order to dispose such shares would be required to sell their shares in open
market transactions, potentially at a loss.

 

If we seek shareholder
approval in connection with our initial business combination, our initial shareholders have agreed (and their permitted transferees
will agree), pursuant to the terms of a letter agreement entered into with us, to vote their founder shares and any public shares
held by them in favor of our initial business combination. Additionally, each public shareholder may elect to redeem its public
shares without voting and, if they do vote, irrespective of whether they vote for or against the proposed transaction.

 

Pursuant to our amended
and restated memorandum and articles of association, if we have not completed our initial business combination within 18 months
from the closing of this offering or during or during any extended time that we have to consummate a business combination beyond
18 months as a result of a shareholder vote to amend our amended and restated memorandum and articles of association (an “Extension
Period”), we will (1) cease all operations except for the purpose of winding up, (2) as promptly as reasonably
possible but not more than 10 business days thereafter, redeem the public shares, at a per-share price, payable in cash, equal
to the aggregate amount then on deposit in the trust account, including interest (less up to $100,000 of interest to pay dissolution
expenses and which interest shall be net of taxes payable), divided by the number of then issued and outstanding public shares,
which redemption will completely extinguish public shareholders’ rights as shareholders (including the right to receive further
liquidating distributions, if any), and (3) as promptly as reasonably possible following such redemption, subject to the approval
of our remaining shareholders and our board of directors, liquidate and dissolve, subject in each case to our obligations under
Cayman Islands law to provide for claims of creditors and the requirements of other applicable law. Our initial shareholders have
entered into a letter agreement with us, pursuant to which they have agreed to waive their rights to liquidating distributions
from the trust account with respect to their founder shares if we fail to complete our initial business combination within 18 months
from the closing of this offering or during any Extension Period. However, if our initial shareholders, directors acquire public
shares, they will be entitled to liquidating distributions from the trust account with respect to such public shares if we fail
to complete our initial business combination within the prescribed time period.

 

In the event of a liquidation,
dissolution or winding up of the company after a business combination, our shareholders at such time will be entitled to share
ratably in all assets remaining available for distribution to them after payment of liabilities and after provision is made for
each class of shares, if any, having preference over the ordinary shares. Our shareholders have no preemptive or other subscription
rights. There are no sinking fund provisions applicable to the ordinary shares, except that we will provide our shareholders with
the opportunity to redeem their public shares for cash equal to their pro rata share of the aggregate amount then on deposit in
the trust account, including interest (which interest shall be net of taxes payable), upon the completion of our initial business
combination, subject to the limitations described herein.

 

    3

     

    

 

Founder Shares

 

The founder shares
are designated as Class B ordinary shares and are identical to the Class A ordinary shares included in the units sold
in our IPO, and holders of founder shares have the same shareholder rights as public shareholders, except that: (1) the founder
shares are subject to certain transfer restrictions, as described in more detail below; (2) our initial shareholders, directors
and officers have entered into a letter agreement with us, pursuant to which they have agreed to waive: (i) their redemption
rights with respect to any founder shares and public shares held by them, as applicable, in connection with the completion of our
initial business combination; (ii) their redemption rights with respect to any founder shares and public shares held by them
in connection with a shareholder vote to amend our amended and restated memorandum and articles of association (A) to modify
the substance or timing of our obligation to allow redemption in connection with our initial business combination or to redeem
100% of our public shares if we do not complete our initial business combination within 18 months from the closing of this offering
or (B) with respect to any other provision relating to shareholders’ rights or pre-initial business combination activity;
and (iii) their rights to liquidating distributions from the trust account with respect to any founder shares they hold if
we fail to complete our initial business combination within 18 months from the closing of this offering or during any Extension
Period (although they will be entitled to liquidating distributions from the trust account with respect to any public shares they
hold if we fail to complete our initial business combination within the prescribed time frame); (3) the founder shares will
automatically convert into our Class A ordinary shares at the time of our initial business combination, or earlier at the
option of the holder, on a one-for-one basis, subject to adjustment pursuant to certain anti-dilution rights, as described in more
detail below; and (4) the founder shares are entitled to registration rights. If we submit our initial business combination
to our public shareholders for a vote, our initial shareholders have agreed (and their permitted transferees will agree), pursuant
to the terms of a letter agreement entered into with us, to vote their founder shares and any public shares held by them purchased
during or after this offering in favor of our initial business combination.

 

The Class B ordinary
shares will automatically convert into Class A ordinary shares at the time of our initial business combination, or earlier
at the option of the holder, on a one-for-one basis, subject to adjustment for share sub-divisions, share dividends, rights issuances,
consolidations, reorganizations, recapitalizations and the like, and subject to further adjustment as provided herein. In the case
that additional Class A ordinary shares, or equity-linked securities, are issued or deemed issued in excess of the amounts
issued in the IPO and related to the closing of our initial business combination, the ratio at which the Class B ordinary
shares will convert into Class A ordinary shares will be adjusted (unless the holders of a majority of the issued and outstanding
Class B ordinary shares agree to waive such anti-dilution adjustment with respect to any such issuance or deemed issuance)
so that the number of Class A ordinary shares issuable upon conversion of all Class B ordinary shares will equal, in
the aggregate, on an as-converted basis, 20% of the sum of all ordinary shares issued and outstanding upon the completion of this
offering plus all Class A ordinary shares and equity-linked securities issued or deemed issued in connection with our initial
business combination, excluding any shares or equity-linked securities issued, or to be issued, to any seller in our initial business
combination. The term “equity-linked securities” refers to any debt or equity securities that are convertible, exercisable
or exchangeable for our Class A ordinary shares issued in a financing transaction in connection with our initial business
combination, including but not limited to a private placement of equity or debt.

 

With certain limited
exceptions, the founder shares are not transferable, assignable or salable (except to our directors and officers and other persons
or entities affiliated with our sponsor, each of whom will be subject to the same transfer restrictions) until the earlier of:
(A) one year after the completion of our initial business combination; and (B) subsequent to our initial business combination
(x) if the last reported sale price of our Class A ordinary shares equals or exceeds $12.00 per share (as adjusted for
share sub-divisions, share dividends, rights issuances, consolidations, reorganizations, recapitalizations and the like) for any
20 trading days within any 30-trading day period commencing at least 150 days after our initial business combination or (y) the
date on which we complete a liquidation, merger, amalgamation, share exchange, reorganization or other similar transaction that
results in all of our public shareholders having the right to exchange their ordinary shares for cash, securities or other property.

 

Register of Members

 

Under Cayman Islands
law, we must keep a register of members and there shall be entered therein:

 

		·	the names and addresses of the members, a statement of the shares held by each member, and of the amount paid or agreed to
be considered as paid, on the shares of each member and the voting rights of the shares of each member;

 

		·	the date on which the name of any person was entered on the register as a member; and

 

		·	the date on which any person ceased to be a member.

 

    4

     

    

 

Under Cayman Islands
law, the register of members of our company is prima facie evidence of the matters set out therein (i.e., the register of members
will raise a presumption of fact on the matters referred to above unless rebutted) and a member registered in the register of members
shall be deemed as a matter of Cayman Islands law to have legal title to the shares as set against its name in the register of
members. Upon the closing of this public offering, the register of members shall be immediately updated to reflect the issue of
shares by us. Once our register of members has been updated, the shareholders recorded in the register of members shall be deemed
to have legal title to the shares set against their name. However, there are certain limited circumstances where an application
may be made to a Cayman Islands court for a determination on whether the register of members reflects the correct legal position.
Further, the Cayman Islands court has the power to order that the register of members maintained by a company should be rectified
where it considers that the register of members does not reflect the correct legal position. If an application for an order for
rectification of the register of members were made in respect of our ordinary shares, then the validity of such shares may be subject
to re-examination by a Cayman Islands court.

 

Preference Shares

 

Our amended and restated
memorandum and articles of association authorize 5,000,000 preference shares and provide that preference shares may be issued from
time to time in one or more series. Our board of directors are authorized to fix the voting rights, if any, designations, powers,
preferences, the relative, participating, optional or other special rights and any qualifications, limitations and restrictions
thereof, applicable to the shares of each series. Our board of directors are able to, without shareholder approval, issue preference
shares with voting and other rights that could adversely affect the voting power and other rights of the holders of the ordinary
shares and could have anti-takeover effects. The ability of our board of directors to issue preference shares without shareholder
approval could have the effect of delaying, deferring or preventing a change of control of us or the removal of existing management.
We have no preference shares issued and outstanding at the date hereof. Although we do not currently intend to issue any preference
shares, we cannot assure you that we will not do so in the future. No preference shares are being issued or registered in the IPO.

 

Redeemable Warrants

 

Public Shareholders’ Warrants

 

Each whole warrant
entitles the registered holder to purchase one Class A ordinary share at a price of $11.50 per share, subject to adjustment
as discussed below, at any time commencing on the later of 30 days after the completion of our initial business combination and
12 months from the closing of this offering, except as described below. Pursuant to the warrant agreement, a warrant holder may
exercise its warrants only for a whole number of Class A ordinary shares. This means only a whole warrant may be exercised
at a given time by a warrant holder. No fractional warrants will be issued upon separation of the units and only whole warrants
will trade. Accordingly, unless you purchase at least two units, you will not be able to receive or trade a whole warrant. The
warrants will expire five years after the completion of our initial business combination, at 5:00 p.m., New York City time, or
earlier upon redemption or liquidation.

 

We will not be obligated
to deliver any Class A ordinary shares pursuant to the exercise of a warrant and will have no obligation to settle such warrant
exercise unless a registration statement under the Securities Act covering the issuance of the Class A ordinary shares issuable
upon exercise of the warrants is then effective and a current prospectus relating thereto is available, subject to our satisfying
our obligations described below with respect to registration, or a valid exemption from registration is available, including in
connection with a cashless exercise. No warrant will be exercisable for cash or on a cashless basis, and we will not be obligated
to issue any shares to holders seeking to exercise their 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 warrant, the holder of such warrant will
not be entitled to exercise such warrant and such warrant may have no value and expire worthless. In the event that a registration
statement is not effective for the exercised warrants, the purchaser of a unit containing such warrant will have paid the full
purchase price for the unit solely for the Class A ordinary share underlying such unit.

 

    5

     

    

 

We are not registering
the Class A ordinary shares issuable upon exercise of the warrants at this time. However, we have agreed that as soon as practicable,
but in no event later than 15 business days, after the closing of our initial business combination, we will use our commercially
reasonable efforts to file with the SEC a registration statement covering the issuance, under the Securities Act, of the Class A
ordinary shares issuable upon exercise of the warrants, and we will use our commercially reasonable efforts to cause the same to
become effective within 60 business days after the closing of our initial business combination and to maintain the effectiveness
of such registration statement, and a current prospectus relating thereto, until the expiration of the warrants in accordance with
the provisions of the warrant agreement. Notwithstanding the above, if our Class A ordinary shares are, at the time of any
exercise of a warrant, not listed on a national securities exchange such that they satisfy the definition of a “covered security”
under Section 18(b)(1) of the Securities Act, we may, at our option, require holders of public warrants who exercise
their warrants to do so on a “cashless basis” in accordance with Section 3(a)(9) of the Securities Act and,
in the event we so elect, we will not be required to file or maintain in effect a registration statement, but will use our commercially
reasonable efforts to register or qualify the shares under applicable blue sky laws to the extent an exemption is not available.
In such event, each holder would pay the exercise price by surrendering the warrants for that number of Class A ordinary shares
equal to the quotient obtained by dividing (x) the product of the number of Class A ordinary shares underlying the warrants,
multiplied by the excess of the “fair market value” (defined below) less the exercise price of the warrants by (y) the
fair market value. The “fair market value” shall mean the volume weighted average price of the Class A ordinary
shares for the 10 trading days ending on the trading day prior to the date on which the notice of exercise is received by the warrant
agent.

 

Redemption
of warrants. Once the warrants become exercisable, we may redeem the outstanding warrants (except as described herein
with respect to the private placement warrants):

 

		·	in whole and not in part;

 

		·	at a price of $0.01 per warrant;

 

		·	upon not less than 30 days’ prior written notice of redemption to each warrant holder; and

 

		·	if, and only if, the last reported sale price of the Class A ordinary shares for any 20 trading days within a 30-trading
day period ending on the third trading day prior to the date on which we send the notice of redemption to the warrant holders (which
we refer to as the “Reference Value”) equals or exceeds $18.00 per share (as adjusted for share sub-divisions, share
dividends, rights issuances, consolidations, reorganizations, recapitalizations and the like).

 

We will not redeem
the warrants as described above unless a registration statement under the Securities Act covering the issuance of the Class A
ordinary shares issuable upon exercise of the warrants is then effective and a current prospectus relating to those Class A
ordinary shares is available throughout the 30-day redemption period. If and when the warrants become redeemable by us, we may
exercise our redemption right even if we are unable to register or qualify the underlying securities for sale under all applicable
state securities laws.

 

We have established
the last of the redemption criterion discussed above 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 we issue a notice of redemption of the warrants,
each warrant holder will be entitled to exercise his, her or its warrant prior to the scheduled redemption date. However, the price
of the Class A ordinary shares may fall below the $18.00 redemption trigger price (as adjusted for share sub-divisions, share
dividends, rights issuances, consolidations, reorganizations, recapitalizations and the like) as well as the $11.50 (for whole
shares) warrant exercise price after the redemption notice is issued.

 

    6

     

    

 

If we call the warrants
for redemption as described above, our management will have the option to require any holder that wishes to exercise its warrant
to do so on a “cashless basis.” In determining whether to require all holders to exercise their warrants on a “cashless
basis,” our management will consider, among other factors, our cash position, the number of warrants that are outstanding
and the dilutive effect on our shareholders of issuing the maximum number of Class A ordinary shares issuable upon the exercise
of our warrants. If our management takes advantage of this option, all holders of warrants would pay the exercise price by surrendering
their warrants for that number of Class A ordinary shares equal to the quotient obtained by dividing (x) the product
of the number of Class A ordinary shares 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 last reported sale price of the Class A ordinary shares 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 warrants. If our management takes advantage
of this option, the notice of redemption will contain the information necessary to calculate the number of shares of Class A
ordinary shares to be received upon exercise of the 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. We believe this feature is an attractive option to us if we do not need the cash from the exercise of the warrants
after our initial business combination. If we call our warrants for redemption and our management does not take advantage of this
option, our sponsor and its permitted transferees would still be entitled to exercise their private placement warrants for cash
or on a cashless basis using the same formula described above that other warrant holders would have been required to use had all
warrant holders been required to exercise their warrants on a cashless basis, as described in more detail below.

 

Redemption
procedures. A holder of a warrant may notify us in writing in the event it elects to be subject to a requirement that
such holder will not have the right to exercise such 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 Class A ordinary shares issued and outstanding immediately after
giving effect to such exercise.

 

Anti-dilution
Adjustments. If the number of issued and outstanding Class A ordinary shares is increased by a capitalization or
share dividend payable in Class A ordinary shares, or by a split-up of Class A ordinary shares or other similar event,
then, on the effective date of such capitalization or share dividend, split-up or similar event, the number of Class A ordinary
shares issuable on exercise of each warrant will be increased in proportion to such increase in the issued and outstanding Class A
ordinary shares. A rights offering made to all or substantially all holders of Class A ordinary shares entitling holders to
purchase Class A ordinary shares at a price less than the “historical fair market value” (as defined below) will
be deemed a share dividend of a number of Class A ordinary shares equal to the product of (1) the number of Class A
ordinary shares 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 Class A ordinary shares) and (2) one minus the quotient of (x) the
price per Class A ordinary share paid in such rights offering and (y) the historical fair market value. For these purposes,
(1) if the rights offering is for securities convertible into or exercisable for Class A ordinary shares, in determining
the price payable for Class A ordinary shares, there will be taken into account any consideration received for such rights,
as well as any additional amount payable upon exercise or conversion and (2) “historical fair market value” means
the volume weighted average price of Class A ordinary shares during the 10 trading day period ending on the trading day prior
to the first date on which the Class A ordinary shares trade on the applicable exchange or in the applicable market, regular
way, without the right to receive such rights.

 

In addition, if we,
at any time while the warrants are outstanding and unexpired, pay to all or substantially all of the holders of Class A ordinary
shares a dividend or make a distribution in cash, securities or other assets to the holders of Class A ordinary shares on
account of such Class A ordinary shares (or other securities into which the warrants are convertible), other than (a) as
described above, (b) any cash dividends or cash distributions which, when combined on a per share basis with all other cash
dividends and cash distributions paid on the Class A ordinary shares during the 365-day period ending on the date of declaration
of such dividend or distribution does not exceed $0.50 (as adjusted for share sub-divisions, share dividends, rights issuances,
consolidations, reorganizations, recapitalizations and the like) but only with respect to the amount of the aggregate cash dividends
or cash distributions equal to or less than $0.50 per share, (c) to satisfy the redemption rights of the holders of Class A
ordinary shares in connection with a proposed initial business combination, (d) to satisfy the redemption rights of the holders
of Class A ordinary shares in connection with a shareholder vote to amend our amended and restated memorandum and articles
of association (A) to modify the substance or timing of our obligation to allow redemption in connection with our initial
business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 18 months
from the closing of this offering or (B) with respect to any other provision relating to shareholders’ rights or pre-initial
business combination activity, or (e) in connection with the redemption of our public shares upon our failure to complete
our initial business combination, 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 Class A
ordinary share in respect of such event.

 

    7

     

    

 

If the number of issued
and outstanding Class A ordinary shares is decreased by a consolidation, combination, reverse share split or reclassification
of Class A ordinary shares or other similar event, then, on the effective date of such consolidation, combination, reverse
share split, reclassification or similar event, the number of Class A ordinary shares issuable on exercise of each warrant
will be decreased in proportion to such decrease in issued and outstanding Class A ordinary shares.

 

Whenever the number
of Class A ordinary shares purchasable upon the exercise of the 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 Class A ordinary shares purchasable upon the exercise of the warrants immediately
prior to such adjustment and (y) the denominator of which will be the number of Class A ordinary shares so purchasable
immediately thereafter.

 

In addition, if (x) we
issue additional ordinary shares or equity-linked securities for capital raising purposes in connection with the closing of our
initial business combination at an issue price or effective issue price of less than $9.20 per ordinary share (with such issue
price or effective issue price to be determined in good faith by our board of directors and, in the case of any such issuance to
our sponsor or its affiliates, without taking into account any founder shares held by our sponsor or such affiliates, as applicable,
prior to such issuance) (the “Newly Issued Price”), (y) the aggregate gross proceeds from such issuances represent
more than 60% of the total equity proceeds, and interest thereon, available for the funding of our initial business combination
on the date of the completion of our initial business combination (net of redemptions), and (z) the volume weighted average
trading price of our Class A ordinary shares during the 20 trading day period starting on the trading day prior to the day
on which we consummate our initial business combination (such price, the “Market Value”) is below $9.20 per share,
the exercise price of the warrants will be adjusted (to the nearest cent) to be equal to 115% of the higher of the Market Value
and the Newly Issued Price, and the $18.00 per share redemption trigger price described above will be adjusted (to the nearest
cent) to be equal to 180% of the higher of the Market Value and the Newly Issued Price.

 

In case of any reclassification
or reorganization of the issued and outstanding Class A ordinary shares (other than those described above or that solely affects
the par value of such Class A ordinary shares), or in the case of any merger or consolidation of us with or into another corporation
(other than a merger or consolidation in which we are the continuing corporation and that does not result in any reclassification
or reorganization of our issued and outstanding Class A ordinary shares), or in the case of any sale or conveyance to another
corporation or entity of the assets or other property of us as an entirety or substantially as an entirety in connection with which
we are 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 warrants and in lieu of our Class A ordinary shares immediately theretofore purchasable
and receivable upon the exercise of the rights represented thereby, the kind and amount of shares, stock or other equity 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 warrants would have received if such holder had exercised their 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 merger or consolidation, then the kind and amount of securities, cash
or other assets for which each 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 merger or consolidation that affirmatively make such election, and if a tender, exchange
or redemption offer has been made to and accepted by such holders (other than a tender, exchange or redemption offer made by the
company in connection with redemption rights held by shareholders of the company as provided for in the company’s amended
and restated memorandum and articles of association or as a result of the redemption of Class A ordinary shares by the company
if a proposed initial business combination is presented to the shareholders of the company for approval) 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 issued and outstanding Class A ordinary shares, the holder of a 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 shareholder if such warrant holder
had exercised the warrant prior to the expiration of such tender or exchange offer, accepted such offer and all of the Class A
ordinary shares 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
warrant agreement. Additionally, if less than 70% of the consideration receivable by the holders of Class A ordinary shares
in such a transaction is payable in the form of ordinary 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 warrant properly exercises the warrant within 30 days following public
disclosure of such transaction, the warrant exercise price will be reduced as specified in the warrant agreement based on the per
share consideration minus Black-Scholes Warrant Value (as defined in the warrant agreement) of the warrant.

 

    8

     

    

 

The warrants will be
issued in registered form under a warrant agreement between Continental Stock Transfer & Trust Company, as warrant agent,
and us. The warrant agreement provides that the terms of the warrants may be amended without the consent of any holder for the
purpose of (i) curing any ambiguity or correct any mistake, including to conform the provisions of the warrant agreement to
the description of the terms of the warrants and the warrant agreement set forth in this prospectus, or defective provision or
(ii) adding or changing any provisions with respect to matters or questions arising under the warrant agreement as the parties
to the warrant agreement may deem necessary or desirable and that the parties deem to not adversely affect the rights of the registered
holders of the warrants, provided that the approval by the holders of at least 65% of the then issued and outstanding public warrants
is required to make any change that adversely affects the interests of the registered holders. You should review a copy of the
warrant agreement, which has been filed as an exhibit to the registration statement of which this prospectus is a part, for a complete
description of the terms and conditions applicable to the warrants.

 

The warrant holders
do not have the rights or privileges of holders of ordinary shares and any voting rights until they exercise their warrants and
receive Class A ordinary shares. After the issuance of Class A ordinary shares upon exercise of the warrants, each holder
will be entitled to one vote for each share held of record on all matters to be voted on by shareholders.

 

No fractional warrants
will be issued upon separation of the units and only whole warrants will trade.

 

Private Placement Warrants

 

The private placement
warrants (including the Class A ordinary shares issuable upon exercise of the private placement warrants) will not be transferable,
assignable or salable until 30 days after the completion of our initial business combination (except, among other limited exceptions,
to our directors and officers and other persons or entities affiliated with our sponsor) and they will not be redeemable by us
so long as they are held by our sponsor or its permitted transferees. Our sponsor, or its permitted transferees, has the option
to exercise the private placement warrants on a cashless basis and have certain registration rights described herein. Otherwise,
the private placement warrants have terms and provisions that are identical to those of the warrants being sold as part of the
units in our IPO. If the private placement warrants are held by holders other than our sponsor or its permitted transferees, the
private placement warrants will be redeemable by us in all redemption scenarios and exercisable by the holders on the same basis
as the warrants included in the units sold in our IPO. Any amendment to the terms of the private placement warrants or any provision
of the warrant agreement with respect to the private placement warrants will require a vote of holders of at least 65% of the number
of the then outstanding private placement warrants.

 

If holders of the private
placement warrants elect to exercise them on a cashless basis, they would pay the exercise price by surrendering his, her or its
warrants for that number of Class A ordinary shares equal to the quotient obtained by dividing (x) the product of the
number of Class A ordinary shares underlying the warrants, multiplied by the excess of the “historical fair market value”
(defined below) less the exercise price of the warrants by (y) the historical fair market value. For these purposes, the “historical
fair market value” shall mean the average last reported sale price of the Class A ordinary shares 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
reason that we have agreed that these warrants will be exercisable on a cashless basis so long as they are held by our sponsor
and its permitted transferees is because it is not known at this time whether they will be affiliated with us following a business
combination. If they remain affiliated with us, their ability to sell our securities in the open market will be significantly limited.
We expect to have policies in place that restrict insiders from selling our securities except during specific periods of time.
Even during such periods of time when insiders will be permitted to sell our securities, an insider cannot trade in our securities
if he or she is in possession of material non-public information. Accordingly, unlike public shareholders who could exercise their
warrants and sell the Class A ordinary shares received upon such exercise freely in the open market in order to recoup the
cost of such exercise, the insiders could be significantly restricted from selling such securities. As a result, we believe that
allowing the holders to exercise such warrants on a cashless basis is appropriate.

 

    9

     

    

 

In order to fund working
capital deficiencies or finance transaction costs in connection with an intended initial business combination, our sponsor or an
affiliate of our sponsor or certain of our officers and directors may loan us funds as may be required, although they are under
no obligation to advance funds or invest in us. Up to $1,500,000 of such loans may be convertible into warrants of the post business
combination entity at a price of $1.00 per warrant at the option of the lender. Such warrants would be identical to the private
placement warrants.

 

Dividends

 

We have not paid any
cash dividends on our ordinary shares to date and do not intend to pay cash dividends prior to the completion of our initial business
combination. The payment of cash dividends in the future will be dependent upon our revenues and earnings, if any, capital requirements
and general financial condition subsequent to completion of our initial business combination. The payment of any cash dividends
subsequent to our initial business combination will be within the discretion of our board of directors at such time. In addition,
our board of directors is not currently contemplating and does not anticipate declaring any share dividends in the foreseeable
future. Further, if we incur any indebtedness in connection with our initial business combination, our ability to declare dividends
may be limited by restrictive covenants we may agree to in connection therewith.

 

Our Transfer Agent and Warrant Agent

 

The transfer agent
for our ordinary shares and warrant agent for our warrants is Continental Stock Transfer & Trust Company. We have agreed
to indemnify Continental Stock Transfer & Trust Company in its roles as transfer agent and warrant agent, its agents and
each of its shareholders, directors, officers and employees against all liabilities, including judgments, costs and reasonable
counsel fees that may arise out of acts performed or omitted for its activities in that capacity, except for any liability due
to any gross negligence, willful misconduct or bad faith of the indemnified person or entity.

 

Certain Differences in Corporate Law

 

Cayman Islands companies
are governed by the Companies Law. The Companies Law is modeled on English Law but does not follow recent English Law statutory
enactments, and differs from laws applicable to United States corporations and their shareholders. Set forth below is a summary
of the material differences between the provisions of the Companies Law applicable to us and the laws applicable to companies incorporated
in the United States and their shareholders.

 

Mergers
and Similar Arrangements. In certain circumstances, the Companies Law allows for mergers or consolidations between two
Cayman Islands companies, or between a Cayman Islands exempted company and a company incorporated in another jurisdiction (provided
that is facilitated by the laws of that other jurisdiction).

 

Where the merger or
consolidation is between two Cayman Islands companies, the directors of each company must approve a written plan of merger or consolidation
containing certain prescribed information. That plan of merger or consolidation must then be authorized by either (a) a special
resolution (at least a majority of 66 2∕3% in value who attend and vote in person or by proxy at a
general meeting) of the shareholders of each company; and (b) such other authorization, if any, as may be specified in such
constituent company’s articles of association. No shareholder resolution is required for a merger between a parent company
(i.e., a company that owns at least 90% of the issued shares of each class in a subsidiary company) and its subsidiary company.
The consent of each holder of a fixed or floating security interest of a constituent company must be obtained, unless the court
waives such requirement. If the Cayman Islands Registrar of Companies is satisfied that the requirements of the Companies Law (which
includes certain other formalities) have been complied with, the Registrar of Companies will register the plan of merger or consolidation.

 

    10

     

    

 

Where the merger or
consolidation involves a foreign company, the procedure is similar, save that with respect to the foreign company, the directors
of the Cayman Islands exempted company are required to make a declaration to the effect that, having made due enquiry, they are
of the opinion that the requirements set out below have been met: (1) that the merger or consolidation is permitted or not
prohibited by the constitutional documents of the foreign company and by the laws of the jurisdiction in which the foreign company
is incorporated, and that those laws and any requirements of those constitutional documents have been or will be complied with;
(2) that no petition or other similar proceeding has been filed and remains outstanding or order made or resolution adopted
to wind up or liquidate the foreign company in any jurisdictions; (3) that no receiver, trustee, administrator or other similar
person has been appointed in any jurisdiction and is acting in respect of the foreign company, its affairs or its property or any
part thereof; and (4) that no scheme, order, compromise or other similar arrangement has been entered into or made in any
jurisdiction whereby the rights of creditors of the foreign company are and continue to be suspended or restricted; and (5) that
there is no other reason why it would be against the public interest to permit the merger or consolidation.

 

Where the surviving
company is the Cayman Islands exempted company, the directors of the Cayman Islands exempted company are further required to make
a declaration to the effect that, having made due enquiry, they are of the opinion that the requirements set out below have been
met: (1) that the foreign company is able to pay its debts as they fall due and that the merger or consolidated is bona fide
and not intended to defraud unsecured creditors of the foreign company; (2) that in respect of the transfer of any security
interest granted by the foreign company to the surviving or consolidated company (a) consent or approval to the transfer has
been obtained, released or waived; (b) the transfer is permitted by and has been approved in accordance with the constitutional
documents of the foreign company; and (c) the laws of the jurisdiction of the foreign company with respect to the transfer
have been or will be complied with; and (3) that the foreign company will, upon the merger or consolidation becoming effective,
cease to be incorporated, registered or exist under the laws of the relevant foreign jurisdiction.

 

Where the above procedures
are adopted, the Companies Law provides for a right of dissenting shareholders to be paid a payment of the fair value of his or
her shares upon their dissenting to the merger or consolidation, in certain circumstances, if they follow a prescribed procedure.
In essence, that procedure is as follows: (a) the shareholder must give his or her written objection to the merger or consolidation
to the constituent company before the vote on the merger or consolidation, including a statement that the shareholder proposes
to demand payment for his or her shares if the merger or consolidation is authorized by the vote; (b) within 20 days following
the date on which the merger or consolidation is approved by the shareholders, the constituent company must give written notice
to each shareholder who made a written objection; (c) a shareholder must within 20 days following receipt of such notice from
the constituent company, give the constituent company a written notice of his or her intention to dissent including, among other
details, a demand for payment of the fair value of his or her shares; (d) within seven days following the date of the expiration
of the period set out in paragraph (b) above or seven days following the date on which the plan of merger or consolidation
is filed, whichever is later, the constituent company, the surviving company or the consolidated company must make a written offer
to each dissenting shareholder to purchase his or her shares at a price that the company determines is the fair value and if the
company and the shareholder agrees to the price within 30 days following the date on which the offer was made, the company must
pay the shareholder such amount; and (e) if the company and the shareholder fails to agree to a price within such 30-day period,
within 20 days following the date on which such 30-day period expires, the company (and any dissenting shareholder) must file a
petition with the Cayman Islands Grand Court to determine the fair value and such petition must be accompanied by a list of the
names and addresses of the dissenting shareholders with whom agreements as to the fair value of their shares have not been reached
by the company. At the hearing of that petition, the court has the power to determine the fair value of the shares together with
a fair rate of interest, if any, to be paid by the company upon the amount determined to be the fair value. Any dissenting shareholder
whose name appears on the list filed by the company may participate fully in all proceedings until the determination of fair value
is reached. These rights of a dissenting shareholder are not to be available in certain circumstances, for example, to dissenters
holding shares of any class in respect of which an open market exists on a recognized stock exchange or recognized interdealer
quotation system at the relevant date where the consideration for such shares to be contributed are shares of any company listed
on a national securities exchange or shares of the surviving or consolidated company or in the context of a parent and subsidiary
merger.

 

    11

     

    

 

Moreover, Cayman Islands
law also has separate statutory provisions that facilitate the reconstruction or amalgamation of companies in certain circumstances,
such schemes of arrangement will generally be more suited for complex mergers or other transactions involving widely held companies,
commonly referred to in the Cayman Islands as a “scheme of arrangement” which may be tantamount to a merger. In the
event that a merger was sought pursuant to a scheme of arrangement (the procedures of which are more rigorous and take longer to
complete than the procedures typically required to consummate a merger in the United States), the arrangement in question must
be approved by a majority in number of each class of shareholders and creditors with whom the arrangement is to be made and who
must in addition represent three-fourths in value of each such class of shareholders or creditors, as the case may be, that are
present and voting either in person or by proxy at a general meeting summoned for that purpose. The convening of the meetings and
subsequently the terms of the arrangement must be sanctioned by the Grand Court of the Cayman Islands. While a dissenting shareholder
would have the right to express to the court the view that the transaction should not be approved, the court can be expected to
approve the arrangement if it is satisfied that:

 

		·	we are not proposing to act illegally or beyond the scope of our corporate authority and we have complied with the statutory
provisions as to majority vote;

 

		·	the shareholders have been fairly represented at the meeting in question;

 

		·	the arrangement is such as a business-person would reasonably approve; and

 

		·	the arrangement is not one that would more properly be sanctioned under some other provision of the Companies Law or that would
amount to a “fraud on the minority.”

 

If a scheme of arrangement
or takeover offer (as described below) is approved, any dissenting shareholder would have no rights comparable to appraisal rights,
which would otherwise ordinarily be available to dissenting shareholders of U.S. corporations, providing rights to receive payment
in cash for the judicially determined value of the shares.

 

Squeeze-out
Provisions. When a takeover offer is made and accepted by holders of 90% of the shares to whom the offer relates within
four months, the offeror may, within a two-month period, require the holders of the remaining shares to transfer such shares on
the terms of the offer. An objection can be made to the Grand Court of the Cayman Islands, but this is unlikely to succeed unless
there is evidence of fraud, bad faith, collusion or inequitable treatment of the shareholders.

 

Further, transactions
similar to a merger, reconstruction and/or an amalgamation may in some circumstances be achieved through other means to these statutory
provisions, such as a share capital exchange, asset acquisition or control, through contractual arrangements, of an operating business.

 

Shareholders’
Suits. Our Cayman Islands counsel is not aware of any reported class action having been brought in a Cayman Islands court.
Derivative actions have been brought in the Cayman Islands courts, and the Cayman Islands courts have confirmed the availability
of such actions. In most cases, we will be the proper plaintiff in any claim based on a breach of duty owed to us, and a claim
against (for example) our directors or officers usually may not be brought by a shareholder. However, based both on Cayman Islands
authorities and on English authorities, which would in all likelihood be of persuasive authority and applied by a court in the
Cayman Islands, exceptions to the foregoing principle apply in circumstances in which:

 

		·	a company is acting, or proposing to act, illegally or beyond the scope of its authority;

 

		·	the act complained of, although not beyond the scope of the authority, could be effected if duly authorized by more than the
number of votes that have actually been obtained; or

 

		·	those who control the company are perpetrating a “fraud on the minority.”

 

A shareholder may have
a direct right of action against us where the individual rights of that shareholder have been infringed or are about to be infringed.

 

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Enforcement
of Civil Liabilities. The Cayman Islands has a different body of securities laws as compared to the United States and
provides less protection to investors. Additionally, Cayman Islands companies may not have standing to sue before the federal courts
of the United States.

 

We have been advised
by our Cayman Islands legal counsel that the courts of the Cayman Islands are unlikely (1) to recognize or enforce against
us judgments of courts of the United States predicated upon the civil liability provisions of the federal securities laws of the
United States or any state and (2) in original actions brought in the Cayman Islands, to impose liabilities against us predicated
upon the civil liability provisions of the federal securities laws of the United States or any state, so far as the liabilities
imposed by those provisions are penal in nature. In those circumstances, although there is no statutory enforcement in the Cayman
Islands of judgments obtained in the United States, the courts of the Cayman Islands will recognize and enforce a foreign money
judgment of a foreign court of competent jurisdiction without retrial on the merits based on the principle that a judgment of a
competent foreign court imposes upon the judgment debtor an obligation to pay the sum for which judgment has been given provided
certain conditions are met. For a foreign judgment to be enforced in the Cayman Islands, such judgment must be final and conclusive
and for a liquidated sum, and must not be in respect of taxes or a fine or penalty, inconsistent with a Cayman Islands judgment
in respect of the same matter, impeachable on the grounds of fraud or obtained in a manner, and or be of a kind the enforcement
of which is, contrary to natural justice or the public policy of the Cayman Islands (awards of punitive or multiple damages may
well be held to be contrary to public policy). A Cayman Islands Court may stay enforcement proceedings if concurrent proceedings
are being brought elsewhere.

 

Special
Considerations for Exempted Companies. We are an exempted company with limited liability (meaning our public shareholders
have no liability, as members of the company, for liabilities of the company over and above the amount paid for their shares) under
the Companies Law. The Companies Law distinguishes between ordinary resident companies and exempted companies. Any company that
is registered in the Cayman Islands but conducts business mainly outside of the Cayman Islands may apply to be registered as an
exempted company. The requirements for an exempted company are essentially the same as for an ordinary company except for the exemptions
and privileges listed below:

 

		·	annual reporting requirements are minimal and consist mainly of a statement that the company has conducted its operations mainly
outside of the Cayman Islands and has complied with the provisions of the Companies Law;

 

		·	an exempted company’s register of members is not open to inspection;

 

		·	an exempted company does not have to hold an annual general meeting;

 

		·	an exempted company may issue negotiable or bearer shares or shares with no par value;

 

		·	an exempted company may obtain an undertaking against the imposition of any future taxation (such undertakings are usually
given for 30 years in the first instance);

 

		·	an exempted company may register by way of continuation in another jurisdiction and be deregistered in the Cayman Islands;

 

		·	an exempted company may register as a limited duration company; and

 

		·	an exempted company may register as a segregated portfolio company.

 

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Our Amended and Restated Memorandum and Articles of Association

 

Our amended and restated
memorandum and articles of association contain certain requirements and restrictions relating to this offering that will apply
to us until the completion of our initial business combination. These provisions cannot be amended without a special resolution.
As a matter of Cayman Islands law, a resolution is deemed to be a special resolution where it has been approved by either (1) holders
of at least two-thirds (or any higher threshold specified in a company’s articles of association) of a company’s ordinary
shares at a general meeting for which notice specifying the intention to propose the resolution as a special resolution has been
given or (2) if so authorized by a company’s articles of association, by a unanimous written resolution of all of the
company’s shareholders. Other than as described above, our amended and restated memorandum and articles of association provide
that special resolutions must be approved either by holders of at least two-thirds of our ordinary shares who attend and vote in
person or by proxy at a general meeting (i.e., the lowest threshold permissible under Cayman Islands law), or by a unanimous written
resolution of all of our shareholders.

 

Our initial shareholders
may participate in any vote to amend our amended and restated memorandum and articles of association and will have the discretion
to vote in any manner they choose. Specifically, our amended and restated memorandum and articles of association provide, among
other things, that:

 

		·	if we have not completed our initial business combination within 18 months from the closing of this offering or during any
Extension Period, we will: (1) cease all operations except for the purpose of winding up; (2) as promptly as reasonably
possible but not more than 10 business days thereafter, redeem 100% of the public shares, at a per-share price, payable in cash,
equal to the aggregate amount then on deposit in the trust account, including interest (less up to $100,000 of interest to pay
dissolution expenses and which interest shall be net of taxes payable), divided by the number of then issued and outstanding public
shares, which redemption will completely extinguish public shareholders’ rights as shareholders (including the right to receive
further liquidating distributions, if any); and (3) as promptly as reasonably possible following such redemption, subject
to the approval of our remaining shareholders and our board of directors, liquidate and dissolve, subject in each case to our obligations
under Cayman Islands law to provide for claims of creditors and the requirements of other applicable law;

 

		·	prior to our initial business combination, we may not issue additional ordinary shares that would entitle the holders thereof
to (1) receive funds from the trust account or (2) vote as a class with our public shares on any initial business combination;

 

		·	although we do not intend to enter into a business combination with a target business that is affiliated with our sponsor,
our directors or our officers, we are not prohibited from doing so. In the event we enter into such a transaction, we, or a committee
of independent and disinterested directors, will obtain an opinion from an independent investment banking firm that is a member
of FINRA or from an independent accounting firm that such a business combination is fair to our company from a financial point
of view;

 

		·	if a shareholder vote on our initial business combination is not required by law and we do not decide to hold a shareholder
vote for business or other reasons, we will offer to redeem our public shares pursuant to Rule 13e-4 and Regulation 14E of
the Exchange Act, and will file tender offer documents with the SEC prior to completing our initial business combination which
contain substantially the same financial and other information about our initial business combination and the redemption rights
as is required under Regulation 14A of the Exchange Act;

 

		·	as long as our securities are listed on Nasdaq, our initial business combination must be with one or more operating businesses
or assets with a fair market value equal to at least 80% of the assets held in trust (excluding any deferred underwriters fees
and taxes payable on the income earned on the trust account);

 

		·	if our shareholders approve an amendment to our amended and restated memorandum and articles of association (A) to modify
the substance or timing of our obligation to allow redemption in connection with our initial business combination or to redeem
100% of our public shares if we do not complete our initial business combination within 18 months from the closing of this offering
or (B) with respect to any other provision relating to shareholders’ rights or pre-initial business combination activity,
we will provide our public shareholders with the opportunity to redeem all or a portion of their ordinary shares upon such approval
at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest (which
interest shall be net of taxes payable), divided by the number of then issued and outstanding public shares; and

 

		·	we will not effectuate our initial business combination solely with another blank check company or a similar company with nominal
operations.

 

    14

     

    

 

In addition, our amended
and restated memorandum and articles of association provide that under no circumstances will we redeem our public shares in an
amount that would cause our net tangible assets to be less than $5,000,001 following such redemptions.

 

The Companies Law permits
a company incorporated in the Cayman Islands to amend its memorandum and articles of association with the approval of the holders
of at least two-thirds of such company’s issued and outstanding ordinary shares attending and voting at a general meeting.
A company’s articles of association may specify that the approval of a higher majority is required. Accordingly, although
we could amend any of the provisions relating to our proposed offering, structure and business plan which are contained in our
amended and restated memorandum and articles of association, we view all of these provisions as binding obligations to our shareholders
and neither we, nor our directors or officers, will take any action to amend or waive any of these provisions unless we provide
dissenting public shareholders with the opportunity to redeem their public shares.

 

Anti-Money Laundering — Cayman Islands

 

In order to comply
with legislation or regulations aimed at the prevention of money laundering, we are required to adopt and maintain anti-money laundering
procedures, and may require subscribers to provide evidence to verify their identity and source of funds. Where permitted, and
subject to certain conditions, we may also delegate the maintenance of our anti-money laundering procedures (including the acquisition
of due diligence information) to a suitable person.

 

We reserve the right
to request such information as is necessary to verify the identity of a subscriber. In some cases the directors may be satisfied
that no further information is required since an exemption applies under the Anti-Money Laundering Regulations (2020 Revision)
of the Cayman Islands, as amended and revised from time to time (the “Regulations”). Depending on the circumstances
of each application, a detailed verification of identity might not be required where:

 

		(a)	the subscriber is a relevant financial business required to comply with the Regulations or is a majority-owned subsidiary of
such a business; or

 

		(b)	the subscriber is acting in the course of a business in relation to which a regulatory authority exercises regulatory functions
and which is in a country either: (i) listed by the Cayman Islands Anti-Money Laundering Steering Committee; or (ii) after
4 August 2020, assessed as having a low degree of risk of money laundering and terrorist financing in accordance with the
Regulations (each a "Low Risk Country") or is a majority-owned subsidiary of such a subscriber; or

 

		(c)	the subscriber is a central or local government organization, statutory body or agency of government in the Cayman Islands
or a Low Risk Country; or

 

		(d)	the subscriber is a company that is listed on a recognized stock exchange and subject to disclosure requirements which impose
requirements to ensure adequate transparency of beneficial ownership, or is a majority-owned subsidiary of such a company; or

 

		(e)	the subscriber is a pension fund for a professional association, trade union or is acting on behalf of employees of an entity
referred to in sub-paragraphs (a) to (d); or

 

		(f)	the application is made through an intermediary which falls within one of sub-paragraphs (a) to (e), in such a situation
a written assurance from the intermediary, may be relied on, provided such assurance confirms: (i) that the requisite identification
and verification procedures on the subscriber for business and its beneficial owners have been carried out; (ii) the nature
and intended purpose of the business relationship; (iii) that the intermediary has identified the source of funds of the subscriber
for business; and (iv) that the intermediary shall make available copies of any identification and verification data or information
and relevant documents.

 

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For the purposes of
these exceptions, recognition of a financial institution, regulatory authority or jurisdiction will be determined in accordance
with the Regulations by reference to those jurisdictions recognized by the Cayman Islands Monetary Authority as having equivalent
anti-money laundering regulations.

 

In the event of delay
or failure on the part of the subscriber in producing any information required for verification purposes, we may refuse to accept
the application, in which case any funds received will be returned without interest to the account from which they were originally
debited.

 

We also reserve the
right to refuse to make any payment to a shareholder if our directors or officers suspect or are advised that the payment to such
shareholder might result in a breach of applicable anti-money laundering or other laws or regulations by any person in any relevant
jurisdiction, or if such refusal is considered necessary or appropriate to ensure our compliance with any such laws or regulations
in any applicable jurisdiction.

 

If any person resident
in the Cayman Islands knows or suspects or has reasonable grounds for knowing or suspecting that another person is engaged in criminal
conduct or is involved with terrorism or terrorist property and the information for that knowledge or suspicion came to their attention
in the course of business in the regulated sector, or other trade, profession, business or employment, the person will be required
to report such knowledge or suspicion to (1) the Financial Reporting Authority of the Cayman Islands, pursuant to the Proceeds
of Crime Law (2020 Revision) of the Cayman Islands if the disclosure relates to criminal conduct or money laundering or (2) a
police officer of the rank of constable or higher, or the Financial Reporting Authority, pursuant to the Terrorism Law (2018 Revision)
of the Cayman Islands, if the disclosure relates to involvement with terrorism or terrorist financing and property. Such a report
shall not be treated as a breach of confidence or of any restriction upon the disclosure of information imposed by any enactment
or otherwise.

 

Data Protection — Cayman Islands

 

We have certain duties
under the Data Protection Law, 2017 of the Cayman Islands (the “DPL”) based on internationally accepted principles
of data privacy.

 

In this subsection, “we”, “us,”
 “our” and the “Company” refers to ACE Convergence Acquisition Corp. or our affiliates and/or delegates,
except where the context requires otherwise.

 

Privacy Notice

 

Introduction

 

This privacy notice
puts our shareholders on notice that through your investment in the Company you will provide us with certain personal information
which constitutes personal data within the meaning of the DPL (“personal data”).

 

Investor Data

 

We will collect, use,
disclose, retain and secure personal data to the extent reasonably required only and within the parameters that could be reasonably
expected during the normal course of business. We will only process, disclose, transfer or retain personal data to the extent legitimately
required to conduct our activities of on an ongoing basis or to comply with legal and regulatory obligations to which we are subject.
We will only transfer personal data in accordance with the requirements of the DPL, and will apply appropriate technical and organizational
information security measures designed to protect against unauthorized or unlawful processing of the personal data and against
the accidental loss, destruction or damage to the personal data.

 

    16

     

    

 

In our use of this
personal data, we will be characterized as a “data controller” for the purposes of the DPL, while our affiliates and
service providers who may receive this personal data from us in the conduct of our activities may either act as our “data
processors” for the purposes of the DPL or may process personal information for their own lawful purposes in connection with
services provided to us.

 

We may also obtain
personal data from other public sources. Personal data includes, without limitation, the following information relating to a shareholder
and/or any individuals connected with a shareholder as an investor: name, residential address, email address, contact details,
corporate contact information, signature, nationality, place of birth, date of birth, tax identification, credit history, correspondence
records, passport number, bank account details, source of funds details and details relating to the shareholder’s investment
activity.

 

Who this Affects

 

If you are a natural
person, this will affect you directly. If you are a corporate investor (including, for these purposes, legal arrangements such
as trusts or exempted limited partnerships) that provides us with personal data on individuals connected to you for any reason
in relation your investment in the Company, this will be relevant for those individuals and you should transmit the content of
this Privacy Notice to such individuals or otherwise advise them of its content.

 

How the Company May Use a Shareholder’s
Personal Data

 

The Company, as the
data controller, may collect, store and use personal data for lawful purposes, including, in particular:

 

		(a)	where this is necessary for the performance of our rights and obligations under any purchase agreements;

 

		(b)	where this is necessary for compliance with a legal and regulatory obligation to which we are subject (such as compliance with
anti-money laundering and FATCA/CRS requirements); and/or

 

		(c)	where this is necessary for the purposes of our legitimate interests and such interests are not overridden by your interests,
fundamental rights or freedoms.

 

Should we wish to use
personal data for other specific purposes (including, if applicable, any purpose that requires your consent), we will contact you.

 

Why We May Transfer Your Personal Data

 

In certain circumstances
we may be legally obliged to share personal data and other information with respect to your shareholding with the relevant regulatory
authorities such as the Cayman Islands Monetary Authority or the Tax Information Authority. They, in turn, may exchange this information
with foreign authorities, including tax authorities.

 

We anticipate disclosing
personal data to persons who provide services to us and their respective affiliates (which may include certain entities located
outside the US, the Cayman Islands or the European Economic Area), who will process your personal data on our behalf.

 

The Data Protection Measures We Take

 

Any transfer of personal
data by us or our duly authorized affiliates and/or delegates outside of the Cayman Islands shall be in accordance with the requirements
of the DPL.

 

We and our duly authorized
affiliates and/or delegates shall apply appropriate technical and organizational information security measures designed to protect
against unauthorized or unlawful processing of personal data, and against accidental loss or destruction of, or damage to, personal
data.

 

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We shall notify you
of any personal data breach that is reasonably likely to result in a risk to your interests, fundamental rights or freedoms or
those data subjects to whom the relevant personal data relates.

 

Certain Anti-Takeover Provisions of Our Amended and Restated
Memorandum and Articles of Association

 

Our authorized but
unissued ordinary shares and preferred shares are available for future issuances without shareholder approval and could be utilized
for a variety of corporate purposes, including future offerings to raise additional capital, acquisitions and employee benefit
plans. The existence of authorized but unissued and unreserved ordinary shares and preferred shares could render more difficult
or discourage an attempt to obtain control of us by means of a proxy contest, tender offer, merger or otherwise.

 

Listing of Securities

 

Our units, Class A
ordinary shares and warrants are listed on Nasdaq under the symbols “ACEV.U,” “ACEV” and “ACEV WS,”
respectively.

 

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