8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): June 1, 2022

ACCEL ENTERTAINMENT, INC.

(Exact name of registrant as specified in its charter)

Delaware			001-38136		98-1350261
(State or other jurisdiction of incorporation)			(Commission File Number)		(IRS Employer Identification No.)
140 Tower Drive
Burr Ridge	,	Illinois		60527
(Address of principal executive offices)				(Zip Code)

(630) 972-2235

(Registrant’s telephone number, including area code)

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading symbol(s)	Name of each exchange on which registered
Class A-1 common stock, par value $0.0001 per share	ACEL	New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Item 2.01. Completion of Acquisition or Disposition of Assets.

On June 1, 2022, Accel Entertainment, Inc. (the “Company”) completed its previously announced acquisition of all of the outstanding equity interests of Century Gaming Inc. (“Century”), a Montana corporation (the “Acquisition”), pursuant to the terms of a Securities Purchase Agreement (the “Purchase Agreement”), dated March 2, 2021, by and among Century, the shareholders of Century (the “Sellers”), the Company, Accel Entertainment LLC, and Steven W. Arntzen as the Sellers representative, the terms of which were previously disclosed in the Current Report on Form 8-K filed by the Company on March 2, 2021.

The purchase price for the equity interests of Century was approximately $164.2 million (the “Purchase Price”), consisting of an approximately $45.5 million cash payment to the equity holders of the Company, subject to customary adjustments as provided in the Purchase Agreement (the “Cash Consideration”), repayment of approximately $113.2 million of Century’s indebtedness (the “Debt Repayment”), and 515,622 shares of the Company’s Class A-1 common stock (“Common Stock”), par value $0.0001 per share (the “Stock Consideration”), issued to certain members of Century’s management (the “Management Group”).

The payment of the Cash Consideration and the Debt Repayment was financed using cash from a draw of approximately $160 million from the Company’s revolving credit facility and delayed draw term loan facility under its existing Credit Agreement, dated November 13, 2019 (as amended, the “Credit Agreement”), with Capital One, National Association, pursuant to the draw, reimbursement, interest rate and other terms thereunder.

In connection with the Acquisition, the Company issued the 515,622 shares of Common Stock comprising the Stock Consideration in reliance on the exemption from registration under the Securities Act of 1933, as amended (the “Securities Act”), provided by Section 4(a)(2) thereof for transactions not involving a public offering and the safe harbor afforded by Rule 506 thereunder.

The foregoing descriptions of the Acquisition and the Purchase Agreement do not purport to be complete and are qualified in their entirety by reference to the Purchase Agreement, which is incorporated by reference as Exhibit 10.1 to this Current Report on Form 8-K. The descriptions of the Credit Agreement set forth in Item 1.01 of each of the Company’s Current Reports on Form 8-K filed on November 13, 2019 and October 26, 2021 are incorporated herein by reference.

Item 2.03. Creation of a Direct Financial Obligation or an Obligation under an Off- Balance Sheet Arrangement of a Registrant

The information set forth under Item 2.01 above is hereby incorporated by reference into this Item 2.03.

Item 3.02. Unregistered Sales of Equity Securities.

The information set forth in Item 2.01 above is incorporated by reference into this Item 3.02. In connection with issuance of the Stock Consideration, the members of the Management Group represented that they were “accredited investors” (as defined in Rule 501(a) under the Securities Act), represented their intentions to acquire the shares for investment and not with a view to the distribution thereof and agreed to be bound by certain “lock-up” provisions, and appropriate restrictive legends were affixed to the certificates representing all of the shares issued in the Acquisition (or reflected in restricted book entry with the Company’s transfer agent). The members of the Management Group also had adequate access, through business or other relationships, to information about the Company.

Item 7.01. Regulation FD Disclosure

On June 1, 2022, the Company issued a press release announcing the closing of the Acquisition. A copy of that press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K.

This information is being furnished under Item 7.01 and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liability of such section, nor shall this information be deemed incorporated in any filings made by the Company under the Securities Act or the Exchange Act, except as expressly set forth by specific reference in such a filing.

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Item 9.01 Financial Statements and Exhibits.

(a) Financial Statements of Businesses Acquired.

To the extent required by this item, financial statements of Century will be filed as part of an amendment to this Current Report on Form 8-K not later than 71 calendar days after the date this Current Report is required to be filed.

(b) Pro Forma Financial Information

To the extent required by this item, pro forma financial information will be filed as part of an amendment to this Current Report on Form 8-K not later than 71 calendar days after the date this Current Report is required to be filed.

(d) Exhibits

Exhibit Number	Description
10.1*	Securities Purchase Agreement, by and among Century Gaming Inc., the shareholders of Century, the Company, Accel Entertainment LLC, and Steve W. Arntzen as the Sellers representative, dated as of March 2, 2021 (Incorporated by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K dated March 2, 2021).
99.1	Press Release dated June 1, 2022
104	Cover Page Interactive Data File (embedded within the Inline XBRL document)

* Previously filed.

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SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	ACCEL ENTERTAINMENT, INC.
Date: June 1, 2022	By:	/s/ Mathew Ellis
		Mathew Ellis
		Chief Financial Officer

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EX-99.1

Accel Entertainment Completes Century Gaming Acquisition

Adds to its Portfolio More Than 900 Licensed Establishments and 8,300 Gaming Terminals Across Montana and Nevada and Gains Manufacturing Capabilities

CHICAGO (BUSINESS WIRE)--Accel Entertainment, Inc. (NYSE: ACEL) (“Accel”), a leading distributed gaming operator in the U.S., today announced the completion of its previously announced transaction to acquire Century Gaming, Inc. (“Century”), one of the leading distributed gaming operators in the Western United States, for $164.2 million in cash and stock, including Century’s working capital.

“We could not be more excited to further expand our operations in the Western United States with the Century team. We are confident that Century’s leadership team of Steve, Heidi, and Merle, is the perfect partner to guide us into this attractive market and capture new growth,” said Accel CEO Andy Rubenstein. “Together we look forward to continue seeking innovative opportunities to expand our hyper-local business model into new markets across the country.”

Century brings to Accel more than 8,300 gaming terminals and over 900 licensed locations across Montana and Nevada, including bars, taverns, truck stops and convenience store groups in both markets. With the closing of this transaction Accel also adds design and manufacturing operations to its portfolio through Grand Vision Gaming (“GVG”) as well as Century’s proprietary “i-Rewards” and “Gamblers Bonus” rewards programs.

Century’s executive team, including CEO Steve Arntzen, CFO Heidi Schmalz and GVG Managing Director Merle Frank, will continue to lead Century through its next chapter as part of the Accel family.

Steve Arntzen, CEO of Century commented, “In Accel, we have found an ideal strategic partner and together we are uniquely positioned to accelerate our growth trajectory as we deliver the latest technological advancements to the gaming market. I am proud to continue to lead our dynamic team and build upon our strong momentum under the Accel banner as we provide our operators and players with attractive locations, the highest-quality products and world class support for which we are known.”

About Accel

Accel is a leading distributed gaming operator in the United States on an Adjusted EBITDA basis, and a preferred partner for local business owners in the Illinois market. Accel’s business consists of the installation, maintenance and operation of VGTs, redemption devices that disburse winnings and contain ATM functionality, and other amusement devices in authorized non-casino locations such as restaurants, bars, taverns, convenience stores, liquor stores, truck stops, and grocery stores.

About Century Gaming

Century has a 60-plus year history in distributed gaming, and currently services over 900 licensed customers in Montana and Nevada, including many leading bars, taverns, truck stops and convenience store operators. Through the installation state of the art technologies, Century continues to lead the way in player-centric gaming innovation.

Cautionary Note Regarding Forward-Looking Statements

This press release may include “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements other than statements of historical fact included in this press release are forward-looking statements. When used in this press release, words such as “anticipate,” “will,” “believe,” “estimate,” “expect,” “intend,” “target,” “plan,” “outlook,” “addition,” “look forward, “seek,” “continue” and similar expressions and negatives thereof, as they relate to us, our management team, Century or the contemplated transaction or its anticipated effects or benefits,

are intended to identify forward-looking statements. However, not all forward-looking statements contain these identifying words. Such forward-looking statements are based on current reasonable expectations and beliefs of management, as well as assumptions made by, and information currently available to, Accel’s management regarding Century, the contemplated transaction or its anticipated effects or benefits. Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause actual results performance and achievements, or industry results, to differ materially from those contemplated by the forward-looking statements as a result of certain factors detailed in Accel’s filings with the Securities and Exchange Commission (“SEC”).

Anticipated effects or benefits from the contemplated transaction may not ultimately occur, including expected revenues; effective integration of Century’s operations, establishments and terminals with our own; integration of new technology to our own portfolio; and, integration of player rewards programs into our own system or expansion of those rewards programs in other US markets. We cannot guarantee the accuracy of the forward-looking statements, and you should be aware that results and events could differ materially and adversely from those contained in the forward-looking statements due to a number of factors including, but not limited to the existing and potential future adverse impact of the COVID-19 pandemic on Century’s business, operations and financial condition, including as a result of any suspension of gaming operations in Nevada or Montana; our ability to expand effectively into Nevada and Montana; our ability to manage growth effectively; our ability to offer new and innovative products and services that fulfill the needs of Century’s establishment partners and create strong and sustained player appeal; Century’s dependence on relationships with key manufacturers, developers and third parties; the negative impact on Century’s future results of operations by the slow growth in demand for gaming terminals and by slow growth of gaming in Nevada and Montana; Century’s heavy dependency on its ability to win, maintain and renew contracts with licensed establishment partners; unfavorable economic conditions or decreased discretionary spending due to other factors such as epidemics or other public health issues (including COVID-19), terrorist activity or threat thereof, civil unrest or other economic or political uncertainties, that could adversely affect Accel’s or Century’s business, results of operations, cash flows and financial conditions and other risks and uncertainties.

Accordingly, forward-looking statements, including any projections or analysis, should not be viewed as factual and should not be relied upon as an accurate prediction of future results. All subsequent written or oral forward-looking statements attributable to us or persons acting on our behalf are qualified in their entirety by this paragraph. Forward-looking statements are subject to numerous conditions, many of which are beyond the control of Accel. Except as required by law, we do not undertake publicly to update or revise these statements, even if experience or future changes make it clear that any projected results or benefits expressed in this press releases or company statements will not be realized. In addition, the inclusion of any statement in this press release does not constitute an admission by us that the events or circumstances described in such statement are material. We qualify all of our forward-looking statements by these cautionary statements.

Media Contact:

Eric Bonach

Abernathy MacGregor

212-371-5999

ejb@abmac.com

XML

Cover	Jun. 01, 2022
Cover [Abstract]
Document Type	8-K
Document Period End Date	Jun. 01, 2022
Entity Registrant Name	ACCEL ENTERTAINMENT, INC.
Entity Central Index Key	0001698991
Amendment Flag	false
Entity Incorporation, State or Country Code	DE
Entity File Number	001-38136
Entity Tax Identification Number	98-1350261
Entity Address, Address Line One	140 Tower Drive
Entity Address, City or Town	Burr Ridge
Entity Address, State or Province	IL
Entity Address, Postal Zip Code	60527
City Area Code	630
Local Phone Number	972-2235
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Title of 12(b) Security	Class A-1 common stock, par value $0.0001 per share
Trading Symbol	ACEL
Security Exchange Name	NYSE
Entity Emerging Growth Company	true
Entity Ex Transition Period	false