PRER14A 1 d944516dprer14a.htm PRER14A PRER14A
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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

SCHEDULE 14A

(Amendment No. 3)

 

 

Information Required in Proxy Statement

Schedule 14A Information

Proxy Statement Pursuant to Section 14(a) of the

Securities Exchange Act of 1934

Filed by the Registrant  ☒                             Filed by a Party other than the Registrant  ☐

Check the appropriate box:

 

 

Preliminary Proxy Statement

 

Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))

 

Definitive Proxy Statement

 

Definitive Additional Materials

 

Soliciting Material Pursuant to §240.14a-12

dMY Technology Group, Inc.

(Name of Registrant as Specified In Its Charter)

N/A

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

 

 

No fee required.

 

Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.

 

(1)

 

Title of each class of securities to which transaction applies:

 

     

 

(2)

 

Aggregate number of securities to which transaction applies:

 

     

 

(3)

 

Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined):

 

     

 

(4)

 

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(5)

 

Total fee paid:

 

     

 

Fee paid previously with preliminary materials.

 

Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.

 

(1)

 

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Date Filed:

 

     

 

 

 


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PRELIMINARY PROXY STATEMENT – SUBJECT TO COMPLETION DATED DECEMBER 4, 2020

DMY TECHNOLOGY GROUP, INC.

1180 North Town Center Drive, Suite 100

Las Vegas, Nevada 89144

PROXY STATEMENT FOR SPECIAL MEETING

OF STOCKHOLDERS OF

DMY TECHNOLOGY GROUP, INC.

Dear Stockholders of dMY Technology Group, Inc.:

You are cordially invited to attend the special meeting (the “special meeting”) of stockholders of dMY Technology Group, Inc., a Delaware corporation (“dMY,” the “Company,” “we,” “us” or “our”), which will be held at 10:00 AM, Eastern Time, on [•], 2020, at [•] (the “special meeting”). In light of ongoing developments related to the novel coronavirus (“COVID-19”), after careful consideration, we have determined that the special meeting will be a virtual meeting conducted exclusively via live webcast in order to facilitate stockholder attendance while safeguarding the health and safety of our stockholders, directors and management team. You or your proxyholder will be able to attend and vote at the special meeting by visiting [•] and using a control number assigned by Continental Stock Transfer & Trust Company. To register and receive access to the virtual meeting, registered stockholders and beneficial stockholders (those holding shares through a stock brokerage account or by a bank or other holder of record) will need to follow the instructions applicable to them provided in this proxy statement.

On July 27, 2020, the Company entered into a Business Combination Agreement with Rush Street Interactive, LP, a Delaware limited partnership (“RSI”), the sellers set forth on the signature pages thereto (collectively, the “Sellers” and each, a “Seller”), dMY Sponsor, LLC, a Delaware limited liability company (the “Sponsor”), and Rush Street Interactive GP, LLC, a Delaware limited liability company, in its capacity as the Sellers’ Representative (in such capacity, the “Sellers’ Representative”). The parties amended and restated the Business Combination Agreement on October 9, 2020 and further amended the Business Combination Agreement on December 4, 2020 (as so amended and restated and further amended, the “Business Combination Agreement”). The transactions contemplated by the Business Combination Agreement are referred to herein as the “Business Combination.” You are being asked to vote on the Business Combination.

Following the closing of the Business Combination (the “Closing”), we will be organized in an umbrella partnership–C corporation (“Up-C”) structure, in which substantially all of the assets of the combined company will be held by RSI, and the Company’s only assets will be its equity interests in RSI (which will be held indirectly through the Special Limited Partner, as defined below) and the RSI GP (as defined below).

As part of the Business Combination, (i) the Sellers will retain certain of their common units of RSI (“RSI Units”) and will receive an equal number of non-economic voting shares in the Company, (ii) RSI will be controlled by a newly formed, wholly-owned subsidiary of the Company and the general partner of RSI (the “RSI GP”) and (iii) a newly formed, wholly-owned subsidiary of the Company (the “Special Limited Partner”) will acquire newly issued RSI Units (the “Issued RSI Units”) from RSI and certain outstanding RSI Units from some or all of the Sellers.

Specifically, pursuant to the Business Combination Agreement, subject to the satisfaction or waiver of the conditions set forth therein, at the time of the Closing, (i) the Sellers will retain the number of RSI Units (the “Retained RSI Units”) that will cause the Sellers’ aggregate percentage ownership in RSI immediately following the Closing to be equal to the percentage determined as the quotient of (a) RSI’s enterprise value (i.e., $1,725,000,000) (the “RSI Enterprise Value”) divided by (b) the sum of (1) the RSI Enterprise Value plus (2) the product of (A) the total number of outstanding shares of Class A Common Stock, par value $0.0001 per share, of the Company (the “Class A Common Stock”) issued and outstanding immediately prior to the Closing (after giving effect to any redemptions of Class A Common Stock by the Company’s current stockholders, the Class B Common Stock Conversion (as defined and discussed below), and any Class A Common Stock purchased in connection with the PIPE (as defined below)) multiplied by (B) $10; (ii) the Sellers (other than the


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Put-Call Sellers (as defined below) to the extent that the Put-Calls (as defined below) are in effect as of the Closing) will transfer to the Special Limited Partner a number of Retained RSI Units (not to exceed (a) 12,500,000 RSI Units to the extent that the Put-Calls are not in effect as of the Closing or (b) 9,923,550 RSI Units to the extent that the Put-Calls are in effect as of the Closing) equal to the quotient of (a) the Purchased RSI Units Cash Consideration (as defined below) divided by (b) $10 (the “Purchased RSI Units” which, for the avoidance of doubt, excludes any Put-Call Units to the extent that the Put-Calls are in effect as of the Closing); (iii) the Company will issue to RSI (for immediate further distribution to the Sellers) the number of shares of newly issued Class V Voting Stock, par value $0.0001 per share, of the Company (the “Class V Voting Stock”) equal to the number of Retained RSI Units (net of the number of Purchased RSI Units, but including the number of Put-Call Units to the extent that the Put-Calls are in effect as of the Closing), which will entitle its holder to one vote per share but not any right to dividends or distributions; (iv) the Special Limited Partner will contribute cash to RSI in the amount of the Contribution Amount (as defined below) in exchange for a number of RSI Units equal to the aggregate number of shares of Class A Common Stock outstanding as of the Closing (after giving effect to any redemptions of Class A Common Stock by the Company’s current stockholders, the Class B Common Stock Conversion (as defined and discussed below), and any Class A Common Stock issued to investors in the PIPE (as defined below)) minus the number of Purchased RSI Units; (v) RSI GP will acquire 100% of the general partnership interests of RSI; and (vi) if the Closing occurs on or prior to December 20, 2020, the Put-Calls will be effective and beginning on December 21, 2020 until December 28, 2020, the Put-Call Sellers will have the right to sell to RSI, and RSI will have the right to purchase from the Put-Call Sellers, the Put-Call Units (which Put-Call Units shall not consist of any Earnout Shares), on the terms and subject to the conditions set forth in the Business Combination Agreement and the Put-Call Agreements (as defined and further described below). At the Closing, we anticipate the Company’s wholly-owned subsidiary, the Special Limited Partner, will hold between approximately 12.4% and 23.1% of RSI’s economic interests, while the Sellers will hold between approximately 76.9% and 87.6% of such interests, depending on the extent to which the Company’s current stockholders exercise their right to redeem their Class A Common Stock. For a description of the assumptions underlying such maximum and minimum redemption scenarios, see the section entitled “Summary of the Proxy Statement — Organizational Structure.”

In addition, in connection with the Business Combination, (i) all of the currently outstanding shares of Class B Common Stock, par value $0.0001 per share, of the Company (the “Class B Common Stock”) will automatically be converted into shares of Class A Common Stock on a one-for-one basis (the “Class B Common Stock Conversion”) and (ii) the Company, the Special Limited Partner, RSI, the Sellers and the Sellers’ Representative will enter into a customary Tax Receivable Agreement (as further described and discussed below).

Pursuant to the Business Combination Agreement, at the Closing, (i) 1,212,813 of the Issued RSI Units issued to the Special Limited Partner and 1,212,813 shares of Class A Common Stock held by the Sponsor and the independent directors of the Company (consisting of Darla Anderson, Francesca Luthi and Charles E. Wert) (such individuals together with the Sponsor, the “Founder Holders”) (after giving effect to the Class B Common Stock Conversion) and (ii) 15,000,000 of the Retained RSI Units held by the Sellers (which, for the avoidance of doubt, shall not consist of any Put-Call Units) and 15,000,000 shares of Class V Voting Stock issued to the Sellers by the Company in connection with the Business Combination, will be subject to certain restrictions and potential forfeiture pending the achievement (if any) of certain earnout targets pursuant to the terms of the Business Combination Agreement (such RSI Units and shares of Class A Common Stock and Class V Voting Stock subject to earnout and forfeiture, the “Earnout Shares” which, for the avoidance of doubt, shall not consist of any Put-Call Units). In addition, pursuant to the Founder Holders Forfeiture Agreement (as defined and described below), up to 1,205,937 shares of Class A Common Stock held by the Founder Holders (after giving effect to the Class B Common Stock Conversion) will be subject to forfeiture for no consideration to the extent that the Total Measureable Cash Amount (as defined in the Founder Holders Forfeiture Agreement) does not equal at least $245,000,000 (as more fully described in the Founder Holders Forfeiture Agreement).

Pursuant to the Business Combination Agreement, unless and until the Earnout Shares become earned in accordance with the Business Combination Agreement, the holders thereof will not be entitled to sell or transfer or vote any of such shares. Pursuant to the Business Combination Agreement, all or a portion of the Earnout Shares will become earned (and the foregoing restrictions will then no longer apply to such Earnout Shares) (i) upon the achievement of certain earnout targets based upon the volume weighted average share price of the


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Company’s Class A Common Stock equal or exceeding $12.00 or $14.00 per share, respectively, for ten (10) trading days of any twenty (20) consecutive trading day period following the Closing, in each case on or any time prior to the third anniversary of the Closing Date, (ii) if a change of control of the Company or RSI is completed on or prior to the third anniversary of the Closing, and (iii) upon the achievement of the Company of certain net revenue targets, each as more fully described in the Business Combination Agreement.

The aggregate consideration payable or issuable by the Company in exchange for the Issued RSI Units is comprised of (i) an amount in cash equal to the Contribution Amount (as defined below), and (ii) the Class V Voting Stock issued to the Sellers as described above. Pursuant to the Business Combination Agreement, “Available Closing Date Cash” will be equal to the sum of (i) the cash remaining in the Company’s trust account as of immediately prior to the Closing following any redemptions of Class A Common Stock by the Company’s current stockholders and payment of the aggregate amount of transaction expenses incurred by the parties to the Business Combination Agreement as of the Closing plus (ii) the aggregate amount of proceeds received by the Company at or prior to the Closing in connection with the PIPE (as defined below). To the extent that the Available Closing Date Cash exceeds $160,000,000, an amount of the Available Closing Date Cash (not to exceed (a) $125,000,000 in the event that the Put-Calls are not in effect as of the Closing or (b) $99,235,500 in the event that the Put-Calls are in effect as of the Closing) determined by calculating (A) the sum of (i) the Available Closing Date Cash less $160,000,000 (provided that the amount of cash attributable to this clause (i) is subject to a cap of $60,000,000) plus (ii) 50% of the amount by which the Available Closing Date Cash exceeds $220,000,000 (provided that the amount of cash attributable to this clause (ii) is subject to a cap of $65,000,000) minus (B) the Aggregate Put-Call Consideration Amount (as defined below), if any (such amount determined by subtracting the amount in clause (B) from the amount in clause (A), the “Purchased RSI Units Cash Consideration”) will be used to purchase from the Sellers (other than the Put-Call Sellers to the extent that the Put-Calls are in effect as of the Closing) the Purchased RSI Units and the remainder of the Available Closing Date Cash (which will include the Aggregate Put-Call Consideration Amount (if any)) will be contributed to RSI in exchange for the Issued RSI Units (such contributed amount, the “Contribution Amount”).

In connection with the execution of the Business Combination Agreement, (i) the Company entered into a subscription agreement with certain funds and accounts managed by Fidelity Management & Research Company LLC (the “Fidelity Subscription Agreement”) and (ii) the Company, the Sellers’ Representative and certain other subscribers entered into subscription agreements (the “Other Subscription Agreements,” together with the Fidelity Subscription Agreement, the “Subscription Agreements”), pursuant to which, such investors have agreed to purchase in connection with the closing of the Business Combination (the “Closing”) an aggregate of 16,043,002 shares of Class A Common Stock, par value $0.0001 per share, of the Company (the “Class A Common Stock”) for a purchase price of $10.00 per share, for an aggregate purchase price of $160,430,020 (together, the “PIPE”). The obligations of each party to consummate the PIPE are conditioned upon, among other things, customary closing conditions and the consummation of the transactions contemplated by the Business Combination Agreement.

Additionally, in the event the Company receives additional proceeds through Permitted Equity Financing Sources during the five business day period following the Closing Date (provided that the aggregate proceeds received in connection with the PIPE and during the five business day period following the Closing Date may not exceed $245,000,000), the Company will cause such amounts to be contributed to the Special Limited Partner, which will in turn contribute such amounts to RSI (the “Post-Closing Contribution Amount”), and in exchange, RSI will issue to the Special Limited Partner additional RSI Units, in an amount equal to the number of shares of Class A Common Stock sold by the Company to such equity financing sources, at the price at which the shares of Class A Common Stock were sold by the Company to such equity financing sources (which price may not be less than $10.00 per share). Thereafter, so long as the Sellers (other than the Put-Call Sellers to the extent that the Put-Calls are in effect as of the Closing) have not already sold to the Special Limited Partner (x) 12,500,000 RSI Units (in the event that the Put-Calls are not in effect as of the Closing) or (y) 9,923,550 RSI Units (in the event that the Put-Calls are in effect as of the Closing), a portion of the Post-Closing Contribution Amount equal to the Redemption Amount (as defined below) will be used to redeem from the Sellers a number of Retained RSI Units equal to (i) the Redemption Amount divided by (ii) $10.00. In connection with such redemption, the Sellers (other than the Put-Call Sellers to the extent that the Put-Calls are in effect as of the Closing) will forfeit a


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corresponding number of shares of Class V Voting Stock held by the Sellers. The Purchased RSI Units Cash Consideration and the portion of the Post-Closing Contribution Amount payable to the Sellers (other than the Put-Call Sellers to the extent that the Put-Calls are in effect as of the Closing) will not in the aggregate exceed (1) $125,000,000 (in the event that the Put-Calls are not in effect as of the Closing) or (2) $99,235,500 (in the event that the Put-Calls are in effect as of the Closing). Pursuant to the Business Combination Agreement, “Redemption Amount” means the amount equal to the difference of (a) the sum of (i) the Available Closing Date Cash plus the aggregate proceeds received by the Company from any Permitted Equity Financing consummated after the Closing and on or prior to the fifth business day following the Closing Date less $160,000,000 (provided that the amount of cash attributable to this clause (i) will not be less than zero or exceed $60,000,000) plus (ii) the positive product (if any) of (A) 50% multiplied by (B) the amount by which the Available Closing Date Cash plus the aggregate proceeds received by the Company from any Permitted Equity Financing consummated after the Closing and on or prior to the fifth business day following the Closing Date exceeds $220,000,000 (provided that the amount of cash attributable to this clause (ii) will in no event be less than zero or exceed $65,000,000) minus (b) the Purchased RSI Units Cash Consideration minus (c) the Aggregate Put-Call Consideration Amount, if any.

On or about the date on which the parties amended and restated the Business Combination Agreement, the Company and RSI entered into Put-Call Agreements with each of Richard Schwartz, Einar Roosileht and Mattias Stetz (the “Put-Call Sellers” and such agreements, the “Put-Call Agreements”). Pursuant to the Put-Call Agreements and the Business Combination Agreement, if the Closing occurs on or prior to December 20, 2020, the Put-Call Agreements will remain effective and beginning on December 21, 2020 until December 28, 2020, the Put-Call Sellers will have the right to sell to RSI for $9.00 per unit, and RSI will have the right to purchase from the Put-Call Sellers for $11.00 per unit, the number of RSI Units held by the Put-Call Sellers (not to exceed 2,576,450 in the aggregate) that would have otherwise been sold to the Company at the Closing as Purchased RSI Units at the Closing or redeemed by RSI following the Closing as described herein (“Put-Call”).

Specifically, the number of RSI Units held by each Put-Call Seller that are subject to the Put-Call (“Put-Call Units” which, for the avoidance of doubt, shall not consist of any Earnout Shares) is determined as the quotient of (A) (i) such Put-Call Seller’s “Seller Proportion” (expressed as a percentage in a notice by RSI to the Company prior to the Closing in accordance with the Business Combination Agreement) multiplied by (ii) the sum of (x) the Available Closing Date Cash less $160,000,000 (provided that the amount of cash attributable to this clause (x) is subject to a cap of $60,000,000) plus (y) 50% of the amount by which Available Closing Date Cash exceeds $220,000,000 (provided that the amount of cash attributable to this clause (y) is subject to a cap of $65,000,000) (the amount determined pursuant to clause (A), the “Put-Call Consideration Amount”) divided by (B) $10.00. The Put-Call Units shall not be comprised of any Earnout Shares. If the Closing occurs on or prior to December 20, 2020 and the Put-Call is therefore effective, the Put-Call Sellers will retain their Put-Call Units and the amount of cash equal to the sum of all Put-Call Consideration Amounts (the “Aggregate Put-Call Consideration Amount”) will comprise a portion of the Contribution Amount and will be contributed by the Company to RSI at the Closing (for use in connection with the exercise, if any, of the Put-Calls or for any other use determined by RSI). If the Closing occurs after December 20, 2020, the Put-Call Agreements will automatically terminate and no longer be effective and the Put-Call Units held by the Put-Call Sellers may be sold to the Company at the Closing as Purchased RSI Units or redeemed by RSI following the Closing in accordance with the Business Combination Agreement as described herein.

In the event that the Put-Call is in effect, the cash proceeds that the Company (through its wholly-owned subsidiary, Special Limited Partner) would have otherwise paid directly to the Put-Call Sellers at the Closing in exchange for the Put-Call Units will instead be contributed by the Special Limited Partner directly to RSI in exchange for a number of additional Issued RSI Units equal to the number of Put-Call Units. As a result, the total number of RSI Units that will be held and controlled by the Company through its wholly-owned subsidiary, the Special Limited Partner, upon the Closing of the Business Combination will not be impacted by the Put-Call Agreements or be dependent on whether the Closing occurs prior to or after December 20, 2020. However, by virtue of RSI issuing additional Issued RSI Units to the Special Limited Partner (as compared to the Special Limited Partner purchasing the Put-Call Units from the Put-Call Sellers), the Special Limited Partner will hold a smaller percentage of the outstanding RSI Units as of the Closing if the Put-Call is in effect given that there will be a larger number of outstanding RSI Units. In those circumstances, to the extent that the Put-Call is not


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ultimately exercised by RSI or the Put-Call Sellers in accordance with the terms of the Put-Call Agreements, the Put-Call Sellers will continue to hold the Put-Call Units and the Special Limited Partner would continue to own a smaller percentage of the RSI Units (as compared to if the Put-Call was never in effect), though RSI would continue to hold the cash proceeds contributed by the Special Limited Partner that would have otherwise been used to redeem the Put-Call Units.

Assuming that (i) none of the Company’s current stockholders exercise their right to redeem their Class A Common Stock, (ii) the aggregate proceeds received by the Company in connection with the PIPE is $160,430,020, (iii) the Put-Calls are in effect as of the Closing and are validly exercised shortly following the Closing or not in effect, (iv) the Sellers (other than the Put-Call Sellers) transfer to the Special Limited Partner the maximum number of Purchased RSI Units (i.e. 9,923,550 if the Put-Calls are in effect or 12,500,000 if the Put-Calls are not in effect) at the Closing pursuant to the Business Combination Agreement, (v) none of the 1,205,937 Founder Holders Forfeiture Shares are forfeited because the Available Closing Date Cash exceeds $245,000,000, (vi) the Earnout Shares are excluded unless and until such shares become earned in accordance with the Business Combination Agreement, (vii) there is no exercise at the Closing of the Sponsor’s 6,600,000 private placement warrants at an exercise price of $11.50 per share (which warrants are not exercisable until the later of 12 months from the closing of the IPO and 30 days after the completion of the Business Combination under the Warrant Agreement governing such warrants), (viii) none of the parties set forth above purchase shares of Class A Common Stock in the open market, (ix) there are no other issuances of equity interests of the Company prior to or in connection with the Closing and (x) there are no issuances of any shares of the Company’s Class A Common Stock within the five business days following the Closing to additional private placement investors or following the Closing under the Plan, (x) the Company is expected to own, indirectly through the Special Limited Partner, approximately 23.11% of the RSI Units at the Closing and will control RSI through RSI GP, and (y) the Sellers will own approximately 76.89% of the RSI Units at the Closing and will control the Company through the ownership of the Class V Voting Stock. Under certain circumstances in which the minimum threshold of $160,000,000 of Available Closing Date Cash is achieved, depending on redemptions by the Company’s current stockholders, the Company may indirectly own approximately 12.41% of the RSI Units at the Closing.

Pursuant to the Business Combination Agreement, the RSI Enterprise Value is subject to adjustment following the Closing in the event that the transaction expenses attributable to RSI and the Sellers, on the one hand, or the Company and the Sponsor, on the other hand, exceed such party’s transaction expense cap (such adjustments more fully described in “The Business Combination Proposal – Consideration to be Received in the Business Combination”). To the extent that the RSI Enterprise Value is adjusted upwards, the Sellers will be issued an aggregate number of additional RSI Units and shares of Class V Voting Stock equal to the amount of the adjustment divided by $10.00. To the extent that the RSI Enterprise Value is adjusted downwards, the Sellers will forfeit for no consideration an aggregate number of RSI Units and shares of Class V Voting Stock equal to the amount of the adjustment divided by $10.00.

Beginning on the six month anniversary of the Closing, each Retained RSI Unit held by the Sellers may be exchanged, subject to certain conditions, for either one share of Class A Common Stock or, at the election of RSI GP in its capacity as the general partner of RSI, depending on, among other things, the availability of cash at RSI after first considering the cash necessary at RSI to fund RSI’s outstanding and anticipated operating expenses, debt service costs and declared dividends (in each case, if any), license fees and expenses, tax obligations and capital for existing and continued growth in new jurisdictions, the cash equivalent of the market value of one share of Class A Common Stock, pursuant to the terms and conditions of the Amended and Restated Agreement of Limited Partnership of RSI (the “RSI A&R LPA”) (such exchange rights, as further described in the RSI A&R LPA, the “Exchange Rights”). For each Retained RSI Unit so exchanged, one share of the Class V Voting Stock will be canceled by the Company.

The Business Combination Agreement provides that the Sellers’ obligation to consummate the Business Combination is conditioned on, among other things, that (i) the Company has Available Closing Date Cash of at least $160,000,000 minus the amount by which the transaction expenses incurred by RSI and the Sellers exceeds $12,500,000 and (ii) all approvals, determinations, grants, confirmations and other conditions with respect to


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gaming regulatory authorities in connection with the transactions contemplated by the Business Combination Agreement and the related agreements have been made, obtained, satisfied or given and in full force and effect. The Business Combination is also subject to the satisfaction or waiver of certain other closing conditions (including, without limitation, certain conditions precedent to the consummation of the Business Combination) as described in the accompanying proxy statement. If these conditions are not met, and such conditions are not waived by the Sellers’ Representative or the Company, as applicable, then the Business Combination Agreement could terminate and the proposed Business Combination may not be consummated. There can be no assurance that the parties to the Business Combination Agreement would waive any such provision of the Business Combination Agreement. Furthermore, in no event will we redeem our public shares in an amount that would cause our net tangible assets to be less than $5,000,001.

From and after the Closing, Neil G. Bluhm and Gregory A. Carlin and their respective trusts (collectively, the “Controlling Holders”) will own a majority of the Company’s outstanding common stock and, therefore, will control a majority of the voting power of the Company’s outstanding common stock. Furthermore, the Controlling Holders intend to enter into a voting agreement prior to the consummation of the Business Combination whereby they agree to vote together on certain matters presented to the Company’s stockholders for so long as the voting agreement is in effect. As a result, the Company will be a “controlled company” within the meaning of the corporate governance standards of the New York Stock Exchange, which status permits the Company to elect not to comply with certain corporate governance requirements as further described herein.

At the special meeting, you will be asked to consider and vote on the following proposals:

 

  (1)

Proposal No. 1: A proposal (the “business combination proposal”) to approve and adopt the Business Combination Agreement, a copy of which is attached to the accompanying proxy statement as Annex A-1 and Annex A-2, and approve the other transactions contemplated by the Business Combination Agreement;

 

  (2)

Proposal No. 2: A proposal to approve and adopt, assuming the business combination proposal is approved and adopted, the second amended and restated certificate of incorporation of the Company (the “Proposed Charter”), which, if approved, would take effect upon the Closing (we refer to this proposal as the “charter amendment proposal”);

 

  (3)

Proposal No. 3(A) – (J): Proposals to approve and adopt, on a non-binding advisory basis, certain governance provisions in the Proposed Charter, which are being presented separately in accordance with United States Securities and Exchange Commission (the “SEC”) guidance to give stockholders the opportunity to present their separate views on important corporate governance provisions, as ten sub-proposals (which we refer to, collectively, as the “advisory charter proposals”);

 

   

Proposal No. 3(A): A proposal to increase the total number of authorized shares and classes of stock to 951,000,000 shares consisting of (i) 1,000,000 shares of preferred stock, par value $0.0001 per share, (ii) 750,000,000 shares of Class A Common Stock, and (iii) 200,000,000 shares of Class V Voting Stock (we refer to this as “advisory charter proposal A”);

 

   

Proposal No. 3(B): A proposal to (i) require the affirmative vote of the holders of at least 6623% of the total voting power of all the then outstanding shares of stock of the Company entitled to vote generally in the election of directors, voting together as a single class to make any amendment to Article V (Bylaws), Article VI (Board of Directors), Article VII (Consent of the Stockholders in Lieu of Meeting), Article VIII (Limited Liability; Indemnification), Article IX (DGCL Section 203), Article XII (Forum), and Article XIII (Amendments) of the Proposed Charter, and (ii) to require the affirmative vote of the holders of at least 80% of the total voting power of all the then outstanding shares of stock of the Company entitled to vote generally in the election of directors, voting together as a single class, to amend Article X (Competition and Corporate Opportunities) (we refer to this as “advisory charter proposal B”);

 

   

Proposal No. 3(C): A proposal to (i) absolve any Seller, the Sponsor, members of the board of directors who are not employees of the Company (“Non-Employee Directors”) or any of


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their Affiliates or Affiliated Entities (each as defined in the Proposed Charter) (collectively, the “Identified Persons”) from the duty to refrain from directly or indirectly (1) engaging in and possessing interests in other business ventures of every type and description, including those engaged in the same or similar business activities or lines of business in which the Company or any of its subsidiaries now engages or proposes to engage or (2) competing with the Company or any of its subsidiaries, on its own account, or in partnership with, or as an employee, officer, director or shareholder of any other person, (ii) to provide that no Identified Person shall be liable to the Company or its stockholders or to any affiliate of the Company for breach of any fiduciary duty solely by reason of the fact that such Identified Person engages in any such activities, and (iii) to provide that the Company renounces any such business opportunity which may be a corporate opportunity for an Identified Person other than any corporate opportunity offered to any Non-Employee Director if such opportunity is expressly offered to such person solely and expressly in his or her capacity as a director or officer of the Company, such opportunity is one the Company is legally permitted to undertake and would otherwise be reasonable for the Company to pursue (we refer to this as “advisory charter proposal C”);

 

   

Proposal No. 3(D): A proposal to require that any equity interests owned or controlled by an Unsuitable Person (as defined in the Proposed Charter) or an affiliate thereof shall be subject to mandatory sale and transfer, subject to the terms and conditions set forth therein, in such number and class(es)/series of equity interests as determined by the board of directors in good faith (following consultation with reputable outside and independent gaming regulatory counsel) pursuant to a resolution adopted by a majority of the directors of the board (we refer to this as “advisory charter proposal D”);

 

   

Proposal No. 3(E): A proposal to elect not to be governed by Section 203 of the DGCL (we refer to this as “advisory charter proposal E”);

 

   

Proposal No. 3(F): A proposal to require that the proposed bylaws of the Company may be amended, altered, changed, added to or repealed by (x) the board of directors or (y) (i) the affirmative vote of the holders of at least a majority of the total voting power of the Company’s capital stock at any time when the Sellers or their Permitted Transferees beneficially own, in the aggregate, 40% or more of the voting power of the Company’s capital stock entitled to vote generally in the election of directors, voting as a single class and (ii) the affirmative vote of the holders of at least 6623% of the total voting power of the Company’s capital stock at any time when the Sellers or their Permitted Transferees beneficially own, in the aggregate, less than 40% of the voting power of the Company’s capital stock entitled to vote generally in the election of directors, voting as a single class (we refer to this as “advisory charter proposal F”);

 

   

Proposal No. 3(G): A proposal to provide that any director may be removed from the board of directors upon a good faith finding by the board of directors that such director is an Unsuitable Person (as defined in the Proposed Charter) (we refer to this as “advisory charter proposal G”);

 

   

Proposal No. 3(H): A proposal to provide that any action required or permitted to be taken by the Company’s stockholders at any annual or special meeting of the stockholders of the Company may be taken by written consent (without a meeting) at any time that the Sellers and their Permitted Transferees beneficially own, in the aggregate, 40% or more of the voting power of the Company’s outstanding capital stock entitled to vote generally in the election of directors if a consent in writing, setting forth the action to be taken, is signed by the holders of outstanding stock having no less than minimum number of votes necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and voted (we refer to this as “advisory charter proposal H”);

 

   

Proposal No. 3(I): A proposal to provide that if the Delaware Court of Chancery lacks subject matter jurisdiction over a claim brought against or on behalf of the Company or any


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of its directors, officers, employees or stockholders, then the sole and exclusive forum for such action shall be another state or federal court located within the state of Delaware, unless the Court of Chancery (or such other state or federal court located within the state of Delaware, as applicable) has dismissed a prior action by the same plaintiff asserting the same claims because such court lacked personal jurisdiction over an indispensable party named as a defendant therein, and to provide further that any cause of action arising under the Securities Act of 1933, as amended, that is asserted against the Company shall be brought in the federal district courts of the United States unless the Company consents in writing to an alternate forum, and to provide further that failure to enforce the forum selection clause of the Proposed Charter would cause the Company irreparable harm and entitle the Company to equitable relief to enforce the forum selection clause (we refer to this as “advisory charter proposal I”); and

 

   

Proposal No. 3(J): A proposal to provide for certain additional changes, including, among other things, (i) changing the post-business combination company’s corporate name from “dMY Technology Group, Inc.” to “Rush Street Interactive, Inc.”, (ii) making the Company’s corporate existence perpetual and (iii) removing certain provisions related to our status as a blank check company that will no longer apply upon consummation of the business combination, all of which our board of directors believes are necessary to adequately address the needs of the post-business combination Company (we refer to this as “advisory charter proposal J”);

 

  (4)

Proposal No. 4: A proposal to approve, assuming the business combination proposal and the charter amendment proposal are approved and adopted, for the purposes of complying with the applicable listing rules of the New York Stock Exchange (the “NYSE”), the issuance of more than 20% of our issued and outstanding common stock (i) pursuant to the terms of the Business Combination Agreement, (ii) upon the exchange of the Retained RSI Units pursuant to the RSI A&R LPA and (iii) the issuance of Class A Common Stock in connection with the PIPE Agreements, in each case, that may result in any Seller or other investor acquiring shares pursuant to the PIPE Agreements owning more than 20% of our outstanding common stock, or more than 20% of the voting power, which could constitute a “change of control” under NYSE rules (we refer to this proposal as the “NYSE proposal”);

 

  (5)

Proposal No. 5: A proposal to approve and adopt, assuming the business combination proposal, the charter amendment proposal and the NYSE proposal are approved and adopted, the Rush Street Interactive, Inc. 2020 Omnibus Equity Incentive Plan, a copy of which is attached to the accompanying proxy statement as Annex C (we refer to this proposal as the “incentive plan proposal” and, collectively with the business combination proposal, the charter amendment proposal and the NYSE proposal, the “condition precedent proposals”);

 

  (6)

Proposal No. 6: A proposal to elect nine directors to serve staggered terms on our board of directors until the 2021, 2022 and 2023 annual meeting of stockholders, respectively, or until such directors’ successors have been duly elected and qualified, or until such directors’ earlier death, resignation, retirement or removal (we refer to this proposal as the “director election proposal”); and

 

  (7)

Proposal No. 7: A proposal to approve the adjournment of the special meeting to a later date or dates, if necessary or appropriate, to permit further solicitation and vote of proxies in the event that there are insufficient votes for, or otherwise in connection with, the approval of any of the condition precedent proposals (we refer to this proposal as the “adjournment proposal”).

Each of these proposals is more fully described in the accompanying proxy statement, which you are encouraged to read carefully.

Our Class A Common Stock and warrants are currently listed on the NYSE under the symbols “DMYT” and “DMYT WS,” respectively. Certain of our shares of Class A Common Stock and warrants currently trade as units consisting of one share of Class A Common Stock and one-half of one redeemable warrant, and are listed on the NYSE under the symbol “DMYT.U.” The units will automatically separate into their component securities upon consummation of the Business Combination and, as a result, will no longer trade as an independent security.


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Upon consummation of the transactions contemplated by the Business Combination Agreement, we will change our name to “Rush Street Interactive, Inc.” We intend to apply to continue the listing of Class A Common Stock and warrants on the NYSE under the symbols “RSI” and “RSI WS,” respectively, upon the Closing.

Only holders of record of shares of Class A Common Stock and shares of Class B Common Stock at the close of business on [•], 2020 (the “record date”) are entitled to notice of and to vote and have their votes counted at the special meeting and any adjournments or postponements of the special meeting. A complete list of our stockholders of record entitled to vote at the special meeting will be available for ten days before the special meeting at our principal executive offices for inspection by stockholders during ordinary business hours for any purpose germane to the special meeting and electronically during the Special Meeting at [•].

We are providing the accompanying proxy statement and proxy card to our stockholders in connection with the solicitation of proxies to be voted at the special meeting and at any adjournments or postponements of the special meeting. Whether or not you plan to attend the special meeting, we urge you to read the accompanying proxy statement carefully and submit your proxy to vote on the Business Combination. Please pay particular attention to the section entitled “Risk Factors” beginning on page 59 of the proxy statement.

After careful consideration, our board of directors has unanimously approved the Business Combination Agreement and the transactions contemplated thereby and determined that each of the business combination proposal, the charter amendment proposal, the advisory charter proposals, the NYSE proposal, the director election proposal, the incentive plan proposal and the adjournment proposal is in the best interests of the Company and its stockholders, and unanimously recommends that you vote or give instruction to vote “FOR” each of those proposals.

The existence of financial and personal interests of our directors and officers may result in conflicts of interest, including a conflict between what may be in the best interests of the Company and its stockholders and what may be best for a director’s personal interests when determining to recommend that stockholders vote for the proposals. See the sections entitled “The Business Combination Proposal — Interests of Certain Persons in the Business Combination” and “Beneficial Ownership of Securities in the accompanying proxy statement for a further discussion.

Our “initial stockholders” (consisting of the Sponsor, Darla Anderson, Francesca Luthi and Charles E. Wert) and our other officers and directors entered into a letter agreement at the time of the Company’s initial public offering (the “IPO”), pursuant to which they agreed to vote the shares of Class B Common Stock (the “Founder Shares”) purchased by them, as well as any shares of Class A Common Stock included in the units sold by the Company in the IPO (the “public shares”) purchased by them during or after the IPO, in favor of the business combination proposal. As of the date hereof, our initial stockholders own 20% of our total outstanding shares of common stock.

Pursuant to the Charter, a holder of public shares (a “public stockholder”) may request that we redeem all or a portion of such public stockholder’s public shares for cash if the Business Combination is consummated. You will be entitled to receive cash for any public shares to be redeemed only if you:

 

  (i)

(a) hold public shares, or (b) hold public shares through units and you elect to separate your units into the underlying public shares and public warrants prior to exercising your redemption rights with respect to the public shares; and

 

  (ii)

prior to 10:00 AM, Eastern Time, on [•], 2020 (two business days prior to the vote at the special meeting), (a) submit a written request to Continental Stock Transfer & Trust Company, our transfer agent (the “transfer agent”), that we redeem your public shares for cash, and (b) deliver your public shares to the transfer agent, physically or electronically through The Depository Trust Company (“DTC”).

Holders of units must elect to separate the underlying public shares and public warrants prior to exercising redemption rights with respect to the public shares. If holders hold their units in an account at a brokerage firm or


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bank, holders must notify their broker or bank that they elect to separate the units into the underlying public shares and public warrants, or if a holder holds units registered in its own name, the holder must contact the transfer agent directly and instruct it to do so. Public stockholders may elect to redeem all or a portion of their public shares even if they vote for the business combination proposal. If the Business Combination is not consummated, the public shares will not be redeemed for cash. If a public stockholder properly exercises its right to redeem its public shares and timely delivers its shares to the transfer agent, we will redeem each public share for a per share price, payable in cash, equal to the aggregate amount then on deposit in the Company’s trust account established in connection with the IPO (the “trust account”), calculated as of two business days prior to the consummation of the Business Combination, including interest earned on the funds held in the trust account (net of taxes payable), divided by the number of then-outstanding public shares. For illustrative purposes, as of [•], 2020, this would have amounted to approximately $10.[•] per public share. If a public stockholder exercises its redemption rights, then it will be exchanging its redeemed public shares for cash and will no longer own such shares. Any request to redeem public shares, once made, may be withdrawn at any time until the deadline for exercising redemption requests and thereafter, with our consent, until the Closing. Furthermore, if a holder of a public share delivers its certificate in connection with an election of its redemption and subsequently decides prior to the applicable date not to elect to exercise such rights, it may simply request that the Company instruct our transfer agent to return the certificate (physically or electronically). The holder can make such request by contacting the transfer agent, at the address or email address listed in the accompanying proxy statement. We will be required to honor such request only if made prior to the deadline for exercising redemption requests. See “Special Meeting — Redemption Rights” in the accompanying proxy statement for a detailed description of the procedures to be followed if you wish to redeem your public shares for cash.

Notwithstanding the foregoing, a holder of public shares, together with any affiliate of such public stockholder or any other person with whom such public stockholder is acting in concert or as a “group” (as defined in Section 13 of the Exchange Act), will be restricted from redeeming its public shares with respect to more than an aggregate of 20% of the public shares, without our prior consent. Accordingly, if a public stockholder, alone or acting in concert or as a group, seeks to redeem more than 20% of the public shares, then any such shares in excess of that 20% limit would not be redeemed for cash, without our prior consent.

Under the Business Combination Agreement, the approval of each of the condition precedent proposals (i.e., the business combination proposal, the charter amendment proposal, the NYSE proposal and the incentive plan proposal) is a condition to the consummation of the Business Combination. The adoption of each condition precedent proposal is conditioned on the approval of all of the condition precedent proposals. If our stockholders do not approve each of the condition precedent proposals, the Business Combination may not be consummated. By contrast, approval of each of the other proposals in this proxy statement (i.e., the director election proposal, the advisory charter proposals and the adjournment proposal) is not a condition to the consummation of the Business Combination.

Approval of the business combination proposal, each of the advisory charter proposals, the NYSE proposal, the incentive plan proposal and the adjournment proposal each require the affirmative vote of a majority of the votes cast by holders of shares of Class A Common Stock and Class B Common Stock present in person (which would include presence at the virtual special meeting) or by proxy at the special meeting and entitled to vote thereon, voting as a single class. Approval of the charter amendment proposal requires the affirmative vote of holders of a majority of the outstanding shares of Class A Common Stock and Class B Common Stock entitled to vote thereon at the special meeting, voting as a single class. The election of the director nominees pursuant to the director election proposal requires the affirmative vote of a plurality of the shares of Class A Common Stock and Class B Common Stock cast by the Company’s stockholders present in person or by proxy at the virtual special meeting and entitled to vote thereon, voting as a single class.

All our stockholders are cordially invited to attend the special meeting in person, which includes presence at the virtual special meeting. To ensure your representation at the special meeting, however, you are urged to complete, sign, date and return the enclosed proxy card as soon as possible.


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If you are a stockholder of record holding shares of common stock, you may also cast your vote in person (which would include voting at the virtual special meeting). If your shares are held in an account at a brokerage firm or bank, you must instruct your broker or bank on how to vote your shares or, if you wish to attend the special meeting and vote in person (which would include voting at the virtual special meeting), obtain a proxy from your broker or bank.

If you fail to return a proxy card or fail to instruct a broker or other nominee how to vote, and do not attend the Special Meeting in person, your shares will not be counted for purposes of determining whether a quorum is present at the special meeting. If a valid quorum is established, any such failure to vote or to provide voting instructions will have the same effect as a vote “AGAINST” the charter amendment proposal, but will have no effect on the outcome of any other proposal in this proxy statement.

Your vote is important regardless of the number of shares you own. Whether you plan to attend the special meeting or not, please sign, date and return the enclosed proxy card as soon as possible in the envelope provided.

If your shares are held in “street name” or are in a margin or similar account, you should contact your broker to ensure that your shares are represented and voted at the special meeting.

On behalf of our board of directors, I would like to thank you for your support of dMY Technology Group, Inc. and look forward to a successful completion of the Business Combination.

 

   By Order of the Board of Directors,
   Harry L. You
[•], 2020    Chairman

If you return your proxy card signed and without an indication of how you wish to vote, your shares will be voted in favor of each of the proposals.

TO EXERCISE YOUR REDEMPTION RIGHTS, YOU MUST (1) IF YOU HOLD SHARES OF CLASS A COMMON STOCK THROUGH UNITS, ELECT TO SEPARATE YOUR UNITS INTO THE UNDERLYING PUBLIC SHARES AND PUBLIC WARRANTS PRIOR TO EXERCISING YOUR REDEMPTION RIGHTS WITH RESPECT TO THE PUBLIC SHARES, (2) SUBMIT A WRITTEN REQUEST TO THE TRANSFER AGENT AT LEAST TWO BUSINESS DAYS PRIOR TO THE VOTE AT THE SPECIAL MEETING, THAT YOUR PUBLIC SHARES BE REDEEMED FOR CASH, AND (3) DELIVER YOUR SHARES OF CLASS A COMMON STOCK TO THE TRANSFER AGENT, PHYSICALLY OR ELECTRONICALLY USING THE DEPOSITORY TRUST COMPANY’S DWAC (DEPOSIT/WITHDRAWAL AT CUSTODIAN) SYSTEM, IN EACH CASE IN ACCORDANCE WITH THE PROCEDURES AND DEADLINES DESCRIBED IN THE ACCOMPANYING PROXY STATEMENT. IF THE BUSINESS COMBINATION IS NOT CONSUMMATED, THEN THE PUBLIC SHARES WILL NOT BE REDEEMED FOR CASH. IF YOU HOLD THE SHARES IN STREET NAME, YOU WILL NEED TO INSTRUCT THE ACCOUNT EXECUTIVE AT YOUR BANK OR BROKER TO WITHDRAW THE SHARES FROM YOUR ACCOUNT IN ORDER TO EXERCISE YOUR REDEMPTION RIGHTS. SEE “SPECIAL MEETING — REDEMPTION RIGHTS” IN THE ACCOMPANYING PROXY STATEMENT FOR MORE SPECIFIC INSTRUCTIONS.

Neither the SEC nor any state securities commission has approved or disapproved of the transactions described in the accompanying proxy statement, passed upon the merits or fairness of the Business Combination Agreement or the transactions contemplated thereby, or passed upon the adequacy or accuracy of the accompanying proxy statement. Any representation to the contrary is a criminal offense.

This proxy statement is dated [•], 2020 and is first being mailed to our stockholders on or about [•], 2020.


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DMY TECHNOLOGY GROUP, INC.

1180 North Town Center Drive, Suite 100

Las Vegas, Nevada 89144

NOTICE OF SPECIAL MEETING

IN LIEU OF THE 2020 ANNUAL MEETING OF STOCKHOLDERS OF DMY TECHNOLOGY GROUP, INC.

To Be Held On [•], 2020

To the Stockholders of dMY Technology Group, Inc.:

NOTICE IS HEREBY GIVEN that a special meeting (the “special meeting”) of stockholders of dMY Technology Group, Inc., a Delaware corporation (“dMY,” the “Company,” “we,” “us” or “our”), will be held at 10:00 AM, Eastern Time, on [•], 2020, at http://[•] (the “special meeting”). In light of ongoing developments related to the novel coronavirus (“COVID-19”), after careful consideration, we have determined that the special meeting will be a virtual meeting conducted exclusively via live webcast in order to facilitate stockholder attendance while safeguarding the health and safety of our stockholders, directors and management team. You are cordially invited to attend the special meeting online by visiting https://[•] and using a control number assigned by Continental Stock Transfer & Trust Company. To register and receive access to the virtual meeting, registered stockholders and beneficial stockholders (those holding shares through a stock brokerage account or by a bank or other holder of record) will need to follow the instructions applicable to them provided in this proxy statement.

At the special meeting, you will be asked to consider and vote on proposals to:

 

  (1)

Proposal No. 1 The Business Combination Proposal — to approve and adopt the Business Combination Agreement, dated as of July 27, 2020, by and among dMY, Rush Street Interactive, LP, a Delaware limited partnership (“RSI”), the sellers set forth on the signature pages thereto (collectively, the “Sellers” and each, a “Seller”), dMY Sponsor, LLC, a Delaware limited liability company (the “Sponsor”), and Rush Street Interactive GP, LLC, a Delaware limited liability company, in its capacity as the Sellers’ Representative (in such capacity, the “Sellers’ Representative”) as amended and restated by the parties on October 9, 2020 and as further amended by the parties on December 4, 2020 (as so amended and restated and further amended, the “Business Combination Agreement”), which provides that, among other things, (i) the Sellers will retain the number of RSI Units (the “Retained RSI Units”) that will cause the Sellers’ aggregate percentage ownership in RSI immediately following the closing of the Business Combination (the “Closing”) to be equal to the percentage determined as the quotient of (a) RSI’s enterprise value (i.e., $1,725,000,000) (the “RSI Enterprise Value”) divided by (b) the sum of (1) the RSI Enterprise Value plus (2) the product of (A) the total number of outstanding shares of Class A Common Stock, par value $0.0001 per share, of the Company (the “Class A Common Stock”) issued and outstanding as of immediately prior to the Closing (after giving effect to any redemptions of Class A Common Stock by the Company’s current stockholders, the conversion of all then-outstanding shares of Class B Common Stock, par value $0.0001 per share, of the Company (the “Class B Common Stock”) into shares of Class A Common Stock on a one-for-one basis (the “Class B Common Stock Conversion”), and any Class A Common Stock purchased in connection with any permitted equity financings consummated on or prior to the Closing (the “PIPE”)) multiplied by (B) $10; (ii) the Sellers (other than Richard Schwartz, Einar Roosileht, and Mattias Stetz (the “Put-Call Sellers”), to the extent that the Closing occurs on or prior to December 20, 2020 such that the put and call rights (the “Put-Calls”) contemplated by those certain Put-Call Agreements, dated as of October 9, 2020, by and among the Company, RSI and the Put-Call Sellers (the “Put-Call Agreements”) are in effect as of the Closing) will transfer to the Special Limited Partner a number of Retained RSI Units (not to exceed (a) 12,500,000 RSI Units to the extent that the Put-Calls are not in effect as of the Closing or (b) 9,923,550 RSI Units to the extent that the Put-Calls are in effect as of the Closing) equal to the quotient of (a) the Purchased RSI Units Cash Consideration (as defined below) divided by (b) $10 (the “Purchased RSI


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  Units” which, for the avoidance of doubt, excludes any Put-Call Units (as defined below) to the extent that the Put-Calls are in effect as of the Closing); (iii) the Company will issue to RSI (for immediate further distribution to the Sellers) the number of shares of newly issued Class V Voting Stock, par value $0.0001 per share, of the Company (the “Class V Voting Stock”) equal to the number of Retained RSI Units (net of the number of Purchased RSI Units, but including the number of Put-Call Units to the extent that the Put-Calls are in effect as of the Closing), which will entitle its holder to one vote per share but not any right to dividends or distributions; (iv) the Special Limited Partner will contribute cash to RSI in the amount of the Contribution Amount (as defined below) in exchange for a number of RSI Units equal to the aggregate number of shares of Class A Common Stock outstanding as of the Closing (after giving effect to any redemptions of Class A Common Stock by the Company’s current stockholders, the Class B Common Stock Conversion, and any Class A Common Stock purchased in connection with the PIPE) minus the number of Purchased RSI Units; (v) a wholly-owned subsidiary of the Company (“RSI GP”) will acquire 100% of the non-economic partnership interests of RSI; and (vi) if the Closing occurs on or prior to December 20, 2020, the Put-Calls will be effective and beginning on December 21, 2020 until December 28, 2020, the Put-Call Sellers will have the right to sell to RSI, and RSI will have the right to purchase from the Put-Call Sellers, the Put-Call Units, on the terms and subject to the conditions set forth in the Business Combination Agreement and the Put-Call Agreements;

Pursuant to the Business Combination Agreement, the “Available Closing Date Cash” will be equal to the sum of (i) the cash remaining in the Company’s trust account as of immediately prior to the Closing following any redemptions of Class A Common Stock by the Company’s current stockholders and payment of the aggregate amount of transaction expenses incurred by the parties to the Business Combination Agreement as of the Closing plus (ii) the aggregate amount of proceeds received by the Company at or prior to the Closing in connection with the PIPE. To the extent that the Available Closing Date Cash exceeds $160,000,000, an amount of the Available Closing Date Cash (not to exceed (a) $125,000,000 in the event that the Put-Calls are not in effect as of the Closing or (b) $99,235,500 in the event that the Put-Calls are in effect as of the Closing) determined by calculating (A) the sum of (i) the Available Closing Date Cash less $160,000,000 (provided that the amount of cash attributable to this clause (i) is subject to a cap of $60,000,000) plus (ii) 50% of the amount by which the Available Closing Date Cash exceeds $220,000,000 (provided that the amount of cash attributable to this clause (ii) is subject to a cap of $65,000,000) minus (B) the Aggregate Put-Call Consideration Amount (as defined below) (such amount determined by subtracting the amount in clause (B) from the amount in clause (A), the “Purchased RSI Units Cash Consideration”) will be used to purchase from the Sellers (other than the Put-Call Sellers to the extent that the Put-Calls are in effect as of the Closing) the Purchased RSI Units and the remainder of the Available Closing Date Cash (which will include the Aggregate Put-Call Consideration Amount (if any)) will be contributed to RSI in exchange for the Issued RSI Units (such contributed amount, the “Contribution Amount”).

Furthermore, pursuant to the Business Combination Agreement, the number of RSI Units held by each Put-Call Seller that are subject to the Put-Call (“Put-Call Units” which, for the avoidance of doubt, shall not consist of any Earnout Shares) is determined as the quotient of (A) (i) such Put-Call Seller’s “Seller Proportion” (expressed as a percentage in a notice by RSI to the Company prior to the Closing in accordance with the Business Combination Agreement) multiplied by (ii) the sum of (x) the Available Closing Date Cash less $160,000,000 (provided that the amount of cash attributable to this clause (x) is subject to a cap of $60,000,000) plus (y) 50% of the amount by which the Available Closing Date Cash exceeds $220,000,000 (provided that the amount of cash attributable to this clause (y) is subject to a cap of $65,000,000) (the amount determined pursuant to clause (A), the “Put-Call Consideration Amount”) divided by (B) $10.00. If the Closing occurs on or prior to December 20, 2020 and the Put-Call is therefore effective, the Put-Call Sellers will retain their Put-Call Units and the amount of cash equal to the sum of all Put-Call Consideration Amounts (the “Aggregate Put-Call Consideration Amount”) will comprise a portion of the Contribution Amount and will be contributed by the Company to RSI at the Closing (for use in connection with the exercise, if any, of the Put-Calls or for any other use determined by RSI). If the Closing occurs after December 20, 2020, the Put-Call Agreements will automatically terminate and no longer be effective and the Put-Call Units held by the


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Put-Call Sellers will be sold to the Company at the Closing as Purchased RSI Units or redeemed by RSI following the Closing in accordance with the Business Combination Agreement;

 

  (2)

Proposal No. 2 — The Charter Amendment Proposal — to approve and adopt, assuming the business combination proposal is approved and adopted, the second amended and restated certificate of incorporation of the Company (the “Proposed Charter”), which, if approved, would take effect upon the Closing (we refer to this proposal as the “charter amendment proposal”);

 

  (3)

Proposal No. 3(A) – (J) — the Advisory Charter Proposals — to approve and adopt, on a non-binding advisory basis, certain governance provisions in the Proposed Charter, which are being presented separately in accordance with SEC guidance to give stockholders the opportunity to present their separate views on important corporate governance provisions, as ten sub-proposals (which we refer to, collectively, as the “advisory charter proposals”):

 

   

Proposal No. 3(A): to increase the total number of authorized shares and classes of stock to 951,000,000 shares, consisting of (i) 1,000,000 shares of preferred stock, par value $0.0001 per share, (ii) 750,000,000 shares of Class A Common Stock, and (iii) 200,000,000 shares of Class V Voting Stock (we refer to this as “advisory charter proposal A”);

 

   

Proposal No. 3(B): (i) to require the affirmative vote of the holders of at least 6623% of the total voting power of all the then outstanding shares of stock of the Company entitled to vote generally in the election of directors, voting together as a single class to make any amendment to Article V (Bylaws), Article VI (Board of Directors), Article VII (Consent of the Stockholders in Lieu of Meeting), Article VIII (Limited Liability; Indemnification), Article IX (DGCL Section 203), Article XII (Forum), and Article XIII (Amendments) of the Proposed Charter, and (ii) to require the affirmative vote of the holders of at least to 80% of the total voting power of all the then outstanding shares of stock of the Company entitled to vote generally in the election of directors, voting together as a single class, to amend Article X (Competition and Corporate Opportunities) (we refer to this as “advisory charter proposal B”);

 

   

Proposal No. 3(C): (i) to absolve any Seller, the Sponsor, members of the board of directors who are not employees of the Company (“Non-Employee Directors”) or any of their Affiliates or Affiliated Entities (each as defined in the Proposed Charter) (collectively, the “Identified Persons”) from the duty to refrain from directly or indirectly (1) engaging in and possessing interests in other business ventures of every type and description, including those engaged in the same or similar business activities or lines of business in which the Company or any of its subsidiaries now engages or proposes to engage or (2) competing with the Company or any of its subsidiaries, on its own account, or in partnership with, or as an employee, officer, director or shareholder of any other person, (ii) to provide that no Identified Person shall be liable to the Company or its stockholders or to any affiliate of the Company for breach of any fiduciary duty solely by reason of the fact that such Identified Person engages in any such activities, and (iii) to provide that the Company renounces any such business opportunity which may be a corporate opportunity for an Identified Person other than any corporate opportunity offered to any Non-Employee Director if such opportunity is expressly offered to such person solely and expressly in his or her capacity as a director or officer of the Company, such opportunity is one the Company is legally permitted to undertake and would otherwise be reasonable for the Company to pursue (we refer to this as “advisory charter proposal C”);

 

   

Proposal No. 3(D): to require that any equity interests owned or controlled by an Unsuitable Person (as defined in the Proposed Charter) or an affiliate thereof shall be subject to mandatory sale and transfer, subject to the terms and conditions set forth therein, in such number and class(es)/series of equity interests as determined by the board of directors in good faith (following consultation with reputable outside and independent gaming regulatory counsel) pursuant to a resolution adopted by a majority of the directors of the board (we refer to this as “advisory charter proposal D”);


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Proposal No. 3(E): to elect not to be governed by Section 203 of the DGCL (we refer to this as “advisory charter proposal E”);

 

   

Proposal No. 3(F): to require that the proposed bylaws of the Company may be amended, altered, changed, added to or repealed by (x) the board of directors or (y) (i) the affirmative vote of the holders of at least a majority of the total voting power of the Company’s capital stock at any time when the Sellers or their Permitted Transferees beneficially own, in the aggregate, 40% or more of the voting power of the Company’s capital stock entitled to vote generally in the election of directors, voting as a single class and (ii) the affirmative vote of the holders of at least 6623% of the total voting power of the Company’s capital stock at any time when the Sellers or their Permitted Transferees beneficially own, in the aggregate, less than 40% of the voting power of the Company’s capital stock entitled to vote generally in the election of directors, voting as a single class (we refer to this as “advisory charter proposal F”);

 

   

Proposal No. 3(G): to provide that any director may be removed from the board of directors upon a good faith finding by the board of directors that such director is an Unsuitable Person (as defined in the Proposed Charter) (we refer to this as “advisory charter proposal G”);

 

   

Proposal No. 3(H): to provide that any action required or permitted to be taken by the Company’s stockholders at any annual or special meeting of the stockholders of the Company may be taken by written consent (without a meeting) at any time that the Sellers and their Permitted Transferees beneficially own, in the aggregate, 40% or more of the voting power of the Company’s outstanding capital stock entitled to vote generally in the election of directors if a consent or consents in writing, setting forth the action to be taken, is signed by the holders of outstanding stock having no less than the minimum number of votes necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and voted (we refer to this as “advisory charter proposal H”);

 

   

Proposal No. 3(I): to provide that if the Delaware Court of Chancery lacks subject matter jurisdiction over a claim brought against or on behalf of the Company or any of its directors, officers, employees or stockholders, then the sole and exclusive forum for such action shall be another state or federal court located within the state of Delaware, unless the Court of Chancery (or such other state or federal court located within the state of Delaware, as applicable) has dismissed a prior action by the same plaintiff asserting the same claims because such court lacked personal jurisdiction over an indispensable party named as a defendant therein, and to provide further that any cause of action arising under the Securities Act of 1933, as amended, that is asserted against the Company shall be brought in the federal district courts of the United States unless the Company consents in writing to an alternate forum, and to provide further that failure to enforce the forum selection clause of the Proposed Charter would cause the Company irreparable harm and entitle the Company to equitable relief to enforce the forum selection clause (we refer to this as “advisory charter proposal I”); and

 

   

Proposal No. 3(J): to provide for certain additional changes, including, among other things, (i) changing the post-business combination company’s corporate name from “dMY Technology Group, Inc.” to “Rush Street Interactive, Inc.”, (ii) making the Company’s corporate existence perpetual and (iii) removing certain provisions related to our status as a blank check company that will no longer apply upon consummation of the business combination, all of which our board of directors believes are necessary to adequately address the needs of the post-business combination Company (we refer to this as “advisory charter proposal J”);

 

  (4)

Proposal No. 4 The NYSE Proposal — to approve, assuming the business combination proposal and the charter amendment proposal are approved and adopted, for the purposes of complying with the applicable listing rules of the New York Stock Exchange (the “NYSE”), the issuance of more than 20% of our issued and outstanding common stock (i) pursuant to the terms of the Business Combination


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  Agreement, (ii) upon the exchange of the Retained RSI Units pursuant to the Amended and Restated Limited Partnership Agreement of RSI (the “RSI A&R LPA”) and (iii) the issuance of Class A Common Stock in connection with subscription agreements entered into in connection with the business combination that, in each case, may result in any Seller or any other investor acquiring shares pursuant to such subscription agreements owning more than 20% of our outstanding common stock, or more than 20% of the voting power, which could constitute a “change of control” under NYSE rules (we refer to this proposal as the “NYSE proposal”);

 

  (5)

Proposal No. 5 The Incentive Plan Proposal — to approve and adopt, assuming the business combination proposal, the charter amendment proposal and the NYSE proposal are approved and adopted, the Rush Street Interactive, Inc. 2020 Omnibus Equity Incentive Plan, a copy of which is attached to the accompanying proxy statement as Annex C (we refer to this proposal as the “incentive plan proposal” and, collectively with the business combination proposal, the charter amendment proposal and the NYSE proposal, the “condition precedent proposals”);

 

  (6)

Proposal No. 6The Director Election Proposal — to elect nine directors to serve staggered terms on our board of directors until the 2021, 2022 and 2023 annual meeting of stockholders, respectively, or until such directors’ successors have been duly elected and qualified, or until such directors’ earlier death, resignation, retirement or removal (we refer to this proposal as the “director election proposal”); and

 

  (7)

Proposal No. 7 The Adjournment Proposal — to approve the adjournment of the special meeting to a later date or dates, if necessary or appropriate, to permit further solicitation and vote of proxies in the event that there are insufficient votes for, or otherwise in connection with, the approval of any of the condition precedent proposals (we refer to this proposal as the “adjournment proposal”).

The above matters are more fully described in the accompanying proxy statement, which also includes, as Annex A, a copy of the Business Combination Agreement and the exhibits attached thereto. We urge you to read carefully the accompanying proxy statement in its entirety, including the Annexes and accompanying financial statements.

The record date for the special meeting is [•], 2020. Only holders of record of shares of Class A Common Stock and shares of Class B Common Stock at the close of business on the record date are entitled to notice of and to vote and have their votes counted at the special meeting and any adjournments or postponements of the special meeting. A complete list of dMY’s stockholders of record entitled to vote at the special meeting will be available for ten days before the special meeting at dMY’s principal executive offices for inspection by stockholders during ordinary business hours for any purpose germane to the special meeting and electronically during the Special Meeting at [].

Our Class A Common Stock and warrants are currently listed on the NYSE under the symbols “DMYTC” and “DMYT WS,” respectively. Certain of our shares of Class A Common Stock and warrants currently trade as units consisting of one share of Class A Common Stock and one-half of one redeemable warrant, and are listed on the NYSE under the symbol “DMYT.U.” The units will automatically separate into their component securities upon consummation of the business combination and, as a result, will no longer trade as an independent security. Upon the Closing, we intend to change our name from “dMY Technology Group, Inc.” to “Rush Street Interactive, Inc.” We intend to apply to continue the listing of our Class A Common Stock and warrants on the NYSE under the symbols “RSI” and “RSI WS,” respectively, upon the Closing.

Pursuant to the Charter, a holder of public shares (a “public stockholder”) may request that dMY redeem all or a portion of its public shares for cash if the business combination is consummated. You will be entitled to receive cash for any public shares to be redeemed only if you:

 

  (i)

(a) hold public shares or (b) hold public shares through units and you elect to separate your units into the underlying public shares and public warrants prior to exercising your redemption rights with respect to the public shares; and


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  (ii)

prior to 10:00 AM Eastern Time on [•], 2020 (two business days prior to the vote at the special meeting), (a) submit a written request to Continental Stock Transfer & Trust Company, dMY’s transfer agent (the “transfer agent”), that dMY redeem your public shares for cash and (b) deliver your public shares to the transfer agent, physically or electronically through The Depository Trust Company (“DTC”).

Holders of units must elect to separate the underlying public shares and public warrants prior to exercising redemption rights with respect to the public shares. If holders hold their units in an account at a brokerage firm or bank, holders must notify their broker or bank that they elect to separate the units into the underlying public shares and public warrants, or if a holder holds units registered in its own name, the holder must contact the transfer agent directly and instruct it to do so. Public stockholders may elect to redeem all or a portion of their public shares even if they vote for the business combination proposal. If the business combination is not consummated, the public shares will not be redeemed for cash. If a public stockholder properly exercises its right to redeem its public shares and timely delivers its shares to the transfer agent, we will redeem each public share for a per share price, payable in cash, equal to the aggregate amount then on deposit in the trust account (the “trust account”) established in connection with the Company’s initial public offering (the “IPO”), calculated as of two business days prior to the consummation of the business combination, including interest earned on the funds held in the trust account (net of taxes payable), divided by the number of then-outstanding public shares. For illustrative purposes, as of [•], 2020, this would have amounted to approximately $10.[•] per public share. If a public stockholder exercises its redemption rights, then it will be exchanging its redeemed public shares for cash and will no longer own such shares. Any request to redeem public shares, once made, may be withdrawn at any time until the deadline for exercising redemption requests and thereafter, with our consent, until the Closing. Furthermore, if a holder of a public share delivers its certificate in connection with an election of its redemption and subsequently decides prior to the applicable date not to elect to exercise such rights, it may simply request that we instruct our transfer agent to return the certificate (physically or electronically). The holder can make such request by contacting the transfer agent, at the address or email address listed in this proxy statement. We will be required to honor such request only if made prior to the deadline for exercising redemption requests. See “Special Meeting — Redemption Rights” in the accompanying proxy statement for a detailed description of the procedures to be followed if you wish to redeem your public shares for cash.

Notwithstanding the foregoing, a holder of public shares, together with any affiliate of such public stockholder or any other person with whom such public stockholder is acting in concert or as a “group” (as defined in Section 13 of the Exchange Act), will be restricted from redeeming its public shares with respect to more than an aggregate of 20% of the public shares, without our prior consent. Accordingly, if a public stockholder, alone or acting in concert or as a group, seeks to redeem more than 20% of the public shares, then any such shares in excess of that 20% limit would not be redeemed for cash, without our prior consent. Furthermore, in no event will we redeem our public shares in an amount that would cause our net tangible assets to be less than $5,000,001. See “The Business Combination Proposal — The Business Combination Agreement.”

Under the Business Combination Agreement, the approval of each of the condition precedent proposals (i.e., the business combination proposal, the charter amendment proposal, the NYSE proposal and the incentive plan proposal) is a condition to the consummation of the Business Combination. The adoption of each condition precedent proposal is conditioned on the approval of all of the condition precedent proposals. The direction election proposal, the advisory charter proposals and the adjournment proposal are not conditioned on the approval of any other proposal. If our stockholders do not approve each of the condition precedent proposals, the Business Combination may not be consummated.

Approval of each of the business combination proposal, each of the advisory charter proposals, the NYSE proposal, the incentive plan proposal and the adjournment proposal requires the affirmative vote of holders of a majority of the votes cast by holders of shares of Class A Common Stock and Class B Common Stock present in person (which would include presence at the virtual special meeting) or by proxy at the special meeting and entitled to vote thereon, voting as a single class. Approval of the charter amendment proposal requires the affirmative vote of holders of a majority of the outstanding shares of Class A Common Stock and Class B Common Stock entitled to vote thereon at the special meeting, voting as a single class. The election of the


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director nominees pursuant to the director election proposal requires a plurality of the votes cast by holders of shares of Class A Common Stock and Class B Common Stock present in person (which would include presence at the virtual special meeting) or by proxy at the special meeting and entitled to vote thereon, voting as a single class.

Your attention is directed to the proxy statement accompanying this notice (including the annexes thereto) for a more complete description of the proposed business combination and related transactions and each of the proposals. We urge you to read the accompanying proxy statement carefully. If you have any questions or need assistance voting your shares of dMY common stock, please contact Morrow Sodali LLC, our proxy solicitor, by calling (800) 662-5200, or banks and brokers can call collect at (203) 658-9400, or by emailing DMYT.info@investor.morrowsodali.com This notice of special meeting and the proxy statement are available at https://www.cstproxy.com/[]/2020.

 

  

By Order of the Board of Directors,

  

Harry L. You

[•], 2020

  

Chairman

Important Notice Regarding the Availability of Proxy Materials for the Special Meeting of Stockholders to be held on [], 2020: This notice of special meeting and the related proxy statement will be available at https://www.cstproxy.com/[]/2020.


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TABLE OF CONTENTS

 

CERTAIN DEFINED TERMS

     1  

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

     8  

QUESTIONS AND ANSWERS ABOUT THE PROPOSALS

     11  

SUMMARY OF THE PROXY STATEMENT

     28  

SELECTED HISTORICAL FINANCIAL INFORMATION OF RSI

     57  

COMPARATIVE SHARE INFORMATION

     59  

TICKER SYMBOLS AND DIVIDEND INFORMATION

     61  

RISK FACTORS

     62  

SPECIAL MEETING

     117  

THE BUSINESS COMBINATION PROPOSAL

     126  

THE CHARTER AMENDMENT PROPOSAL

     169  

THE ADVISORY CHARTER PROPOSALS

     174  

THE NYSE PROPOSAL

     179  

THE INCENTIVE PLAN PROPOSAL

     182  

THE DIRECTOR ELECTION PROPOSAL

     189  

THE ADJOURNMENT PROPOSAL

     191  

OTHER INFORMATION RELATED TO dMY

     192  

dMY’S MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

     200  

BUSINESS OF RSI

     204  

RSI’s MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

     229  

MANAGEMENT OF THE COMPANY FOLLOWING THE BUSINESS COMBINATION

     247  

EXECUTIVE COMPENSATION

     257  

BENEFICIAL OWNERSHIP OF SECURITIES

     266  

CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS

     269  

DESCRIPTION OF SECURITIES

     279  

CERTAIN U.S. FEDERAL INCOME TAX CONSIDERATIONS

     297  

APPRAISAL RIGHTS

     304  

HOUSEHOLDING INFORMATION

     304  

TRANSFER AGENT AND REGISTRAR

     304  

FUTURE STOCKHOLDER PROPOSALS

     304  

WHERE YOU CAN FIND MORE INFORMATION

     306  

INDEX TO FINANCIAL STATEMENTS

     F-1  

ANNEX A-1 – BUSINESS COMBINATION AGREEMENT

     A-1-1  

ANNEX A-2 – AMENDMENT TO THE BUSINESS COMBINATION AGREEMENT

     A-2-1  

ANNEX B – SECOND AMENDED AND RESTATED CERTIFICATE OF INCORPORATION OF RUSH STREET INTERACTIVE, INC.

     B-1  

ANNEX C – FORM OF RUSH STREET INTERACTIVE, INC. 2020 OMNIBUS EQUITY INCENTIVE PLAN

     C-1  

 

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CERTAIN DEFINED TERMS

In this proxy statement, unless otherwise stated or unless the context otherwise requires, the following terms shall have the following meanings.

adjournment proposal” means the proposal to approve the adjournment of the special meeting to a later date or dates.

advisory charter proposals” means the 10 sub-proposals to take effect upon the Closing Date if the charter amendment proposal is approved, consisting of advisory charter proposal A, advisory charter proposal B, advisory charter proposal C, advisory charter proposal D, advisory charter proposal E, advisory charter proposal F, advisory charter proposal G, advisory charter proposal H, advisory charter proposal I, and advisory charter proposal J.

Affiliated Companies” means those partnerships, corporations, limited liability companies, trusts or other entities directly or indirectly controlled by the Company including, without limitation, any subsidiary of the Company, or intermediary company (as those or similar terms are defined under the Gaming Laws of any applicable Gaming Jurisdictions) controlled by the Company, in each case that is registered or licensed under applicable Gaming Laws.

Aggregate Put-Call Consideration Amount” means the sum of all Put-Call Consideration Amounts (if any).

Ancillary Agreements” means the Founder Holders Forfeiture Agreement, the Proposed Charter, the Limited Liability Company Agreement of the RSI GP, the Tax Receivable Agreement, the Investor Rights Agreement, the Services Agreement, the Employment Agreement, the Amended Insider Letter, the Subscription Agreements, the RSI A&R LPA, the Unit Powers, the Put-Call Agreements, and each other agreement, instrument and certificate required by the Business Combination Agreement to be executed by any of the parties to the Business Combination Agreement.

Available Closing Date Cash” means an amount equal to the sum of (i) the cash remaining in the Company’s trust account as of immediately prior to the Closing following any redemptions of Class A Common Stock by the Company’s current stockholders and payment of the aggregate amount of transaction expenses incurred by the parties to the Business Combination Agreement as of the Closing plus (ii) the aggregate amount of proceeds received by the Company at or prior to the Closing in connection with the PIPE.

Available Equity” means the amount of money remaining in the trust account following any redemptions of Class A Common Stock and the amount of additional proceeds (if any) raised by the Company through equity financing sources at or prior to the Closing.

Business Combination” means the acquisitions and transactions contemplated by the Business Combination Agreement.

Business Combination Agreement” means the Business Combination Agreement, dated as of July 27, 2020, by and among dMY, RSI, the Sellers, the Sponsor and the Sellers Representative, as amended and restated by the parties on October 9, 2020 and as further amended by the parties on December 4, 2020, which provides that, among other things, (i) the Sellers will retain the number of Retained RSI Units that will cause the Sellers’ aggregate percentage ownership in RSI immediately following the Closing to be equal to the percentage determined as the quotient of (a) the RSI’s Enterprise Value divided by (b) the sum of (1) the RSI Enterprise Value plus (2) the product of (A) the total number of outstanding shares of Class A Common Stock issued and outstanding as of immediately prior to the Closing (after giving effect to any redemptions of Class A Common Stock by the Company’s current stockholders, the Class B Common Stock Conversion, and any Class A Common Stock purchased in connection with any PIPE consummated on or prior to the Closing) multiplied by (B) $10; (ii) the Sellers (other than the Put-Call Sellers to the extent that the Put-Calls are in effect as of the

 

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Closing) will transfer to the Special Limited Partner the Purchased RSI Units for the Purchased RSI Units Cash Consideration; (iii) the Company will issue to RSI (for immediate further distribution to the Sellers) the number of shares of Class V Voting Stock equal to the number of Retained RSI Units (net of the number of Purchased RSI Units), which will entitle its holder to one vote per share but not any right to dividends or distributions; (iv) the Special Limited Partner will contribute cash to RSI in the amount of the Contribution Amount in exchange for a number of RSI Units equal to the aggregate number of shares of Class A Common Stock outstanding as of the Closing (after giving effect to any redemptions of Class A Common Stock by the Company’s current stockholders, the Class B Common Stock Conversion, and any Class A Common Stock purchased in connection with the PIPE) minus the number of Purchased RSI Units; (v) the RSI GP will acquire 100% of the non-economic partnership interests of RSI; and (vi) if the Closing occurs on or prior to December 20, 2020, the Put-Calls will be effective and the Put-Call Sellers will have the right to sell to RSI, and RSI will have the right to purchase from the Put-Call Sellers, beginning on December 21, 2020 until December 28, 2020, the Put-Call Units, on the terms and subject to the conditions set forth in the Business Combination Agreement and the Put-Call Agreements.

business combination proposal” means the proposal to approve and adopt the Business Combination Agreement and such acquisitions and other transactions as contemplated thereby.

Charter” means the amended and restated certificate of incorporation of the Company.

charter amendment proposal” means the proposal to approve and adopt the Proposed Charter.

Class A Common Stock” means the Class A Common Stock of the Company, par value $0.0001 per share.

Class B Common Stock” means the Class B Common Stock of the Company, par value $0.0001 per share.

Class B Common Stock Conversion” means the automatic conversion at the Closing of all then-outstanding shares of Class B Common Stock into shares of Class A Common Stock on a one-for-one basis.

Class V Voting Stock” means the Class V Voting Stock of the Company, par value $0.0001 per share.

Closing” means the closing of the Business Combination.

Closing Date” means the date on which the Closing occurs.

Company” refers (i) before the Business Combination, to dMY and (ii) immediately following the Business Combination, to the combined company that shall be renamed Rush Street Interactive, Inc. upon the Closing.

condition precedent proposals” means the business combination proposal, the charter amendment proposal, the incentive plan proposal and the NYSE proposal.

Contribution Amount” means an amount of cash equal to the Available Closing Date Cash minus the Purchased RSI Units Cash Consideration. For the avoidance of doubt, the Contribution Amount shall include the Aggregate Put-Call Consideration Amount (if any).

DGCL” means the General Corporation Law of the State of Delaware.

director election proposal” means the proposal to elect nine directors to serve staggered terms on our Board until the 2021, 2022 and 2023 annual meeting of stockholders, respectively, or until such directors’ successors have been duly elected and qualified, or until such directors’ earlier death, resignation, retirement or removal.

dMY,” “we,” “us” or “our” refer to dMY Technology Group, Inc.

 

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DTC” means The Depository Trust Company.

Earnout Shares” means (i) 1,212,813 of the Issued RSI Units issued to the Special Limited Partner and 1,212,813 shares of Class A Common Stock held by the Initial Stockholders (after giving effect to the Class B Common Stock Conversion) and (ii) 15,000,000 of the Retained RSI Units held by the Sellers and 15,000,000 shares of Class V Voting Stock issued to the Sellers by the Company in connection with the Business Combination, each of which will be subject to certain restrictions and potential forfeiture pending the achievement (if any) of certain earnout targets pursuant to the terms of the Business Combination Agreement. For the avoidance of doubt, the Earnout Shares shall not consist of any Put-Call Units.

Exchange Act” means the Securities Exchange Act of 1934, as amended.

Founder Holders Forfeiture Agreement” means the agreement, to be dated as of the Closing Date, pursuant to which the Initial Stockholders will agree to (on a pro rata basis) forfeit for no consideration up to 1,205,937 shares of Class A Common Stock in the aggregate held by the Initial Stockholders to the extent that the Total Measureable Cash Amount (as defined therein) does not equal at least $245,000,000.

Founder Holders Forfeiture Shares” means up to 1,205,937 shares of the Class A Common Stock held by the Founder Holders (after giving effect to the Class B Common Stock Conversion) that are subject to forfeiture for no consideration to the extent that the Total Measureable Cash Amount (as defined in the Founder Holders Forfeiture Agreement) does not equal at least $245,000,000 (as more fully described in the Founder Holders Forfeiture Agreement).

Founder Shares” means the shares of Class B Common Stock purchased by the Sponsor and the following independent directors of the Company: Darla Anderson, Francesca Luthi and Charles E. Wert.

GAAP” means generally accepted accounting principles.

Gaming” or “Gaming Activities” means the conduct of gaming and gambling activities, race books and sports pools, sports wagering, or the use of gaming devices, equipment and supplies in the operation of a casino, gambling simulcasting facility, card club or other similar enterprise, whether land-based or online, including, without limitation, slot machines, gaming tables, cards, dice, gaming chips, player tracking systems, cashless wagering systems, mobile gaming systems, inter-casino linked systems, sports wagering systems, interactive or online gaming systems and related and associated equipment, supplies and systems.

Gaming Authority” means all international, national, foreign, domestic, federal, state, provincial, regional, local, tribal, municipal and other regulatory and licensing bodies, instrumentalities, departments, commissions, authorities, boards, officials, tribunals and agencies with authority over or responsibility for the regulation of Gaming within any Gaming Jurisdiction.

Gaming Jurisdictions” means all jurisdictions, domestic and foreign, and their political subdivisions, in which Gaming Activities are or may be lawfully conducted, and in which or from which the Company or any of its Affiliated Companies conducts, or reasonably expects to conduct, Gaming Activities which are subject to Gaming Laws.

Gaming Laws” means all laws, statutes and ordinances pursuant to which any Gaming Authority possesses regulatory, permit and licensing authority over the conduct of Gaming Activities in which the Company or any of its Affiliated Companies engages, or the ownership or control of an Interest in any such entity that conducts Gaming Activities, in any Gaming Jurisdiction, all orders, decrees, rules and regulations promulgated thereunder, all written and unwritten policies of the Gaming Authorities with respect to the foregoing and all written and unwritten interpretations by the Gaming Authorities of such laws, statutes, ordinances, orders, decrees, rules, regulations and policies.

 

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Gaming Licenses” means all licenses, permits, approvals, orders, authorizations, registrations, findings of suitability, franchises, exemptions, waivers, concessions and entitlements issued by any Gaming Authority necessary for or relating to the conduct of Gaming Activities by the Company or any Affiliated Company or the ownership or control by any Person of capital stock or other securities in any of the foregoing entities, to the extent that it conducts or reasonably expects in good faith to conduct Gaming Activities.

Identified Persons” means (i) any Seller, (ii) the Sponsor, and (iii) any members of the Board who are not employees of the Company or his or her Affiliates or Affiliated Entities (the persons in this clause (iii), each a “Non-Employee Director”). For purposes of this definition, (1) “Affiliate” means (a) in respect of a Seller or the Sponsor, any Person that, directly or indirectly, is controlled by such Seller or the Sponsor (as applicable) or is under common control with such Seller or the Sponsor (as applicable) and shall include any principal, member, director, partner, stockholder, officer, employee or other representative of any of the foregoing (other than the Company and any entity that is controlled by the Company), and (b) in respect of a Non-Employee Director, any Person that, directly or indirectly, is controlled by such Non-Employee Director (other than the Company and any entity that is controlled by the Company), (2) “Affiliated Entity” means (a) any Person of which a Non-Employee Director serves as an officer, director, employee, agent or other representative (other than the Company and any entity that is controlled by the Company), (b) any direct or indirect partner, stockholder, member, manager or other representative of such Person, or (c) any Affiliate of the foregoing, and (3) “Person” means any individual, corporation, general or limited partnership, limited liability company, joint venture, trust, association or any other entity.

incentive plan proposal” means the proposal to approve and adopt the Plan.

Initial Stockholders” means the Sponsor, Darla Anderson, Francesca Luthi and Charles E. Wert.

Investor Rights Agreement” means the agreement, to be dated as of the Closing Date, pursuant to which, among other things, the Sponsor will have the right to nominate two directors to the Board and the Sellers will have the right (i) to nominate the remaining directors of the Board, and (ii) to appoint up to three non-voting board observers to the Board, in each case subject to certain conditions.

Issued RSI Units” means any RSI Units that are issued to the Special Limited Partner pursuant to the Business Combination Agreement.

IPO” means the Company’s initial public offering of units consummated on February 25, 2020.

Minimum Cash Condition” means Available Closing Date Cash of at least $160,000,000 minus the amount by which the transaction expenses incurred by RSI and the Sellers exceeds $12,500,000.

Minimum Stock Sale Price” means a price per share of Class A Common Stock that is ten dollars ($10.00).

NYSE” means the New York Stock Exchange.

“Permitted Equity Financing means purchases of Class A Common Stock at a price per share no less than the Minimum Stock Sale Price consummated (a) by the PIPE Investors or (b) until the date which is five (5) business days following the Closing by any other subscribers that agree to purchase Class A Common Stock as reflected in subscription agreements and subject to the requirements set forth in Section 7.15 of the Business Combination Agreement (including, but not limited to, the requirement that such subscription agreements, in addition to the subscription agreements entered into by the PIPE Investors, do not in the aggregate provide for payment for Class A Common Stock such that, following such payment to the Buyer, the Aggregate Available Cash (as defined in the Business Combination Agreement) would exceed two hundred forty-five million dollars ($245,000,000)).

Permitted Equity Financing Sources” means PIPE Investors or any other financing sources that have been approved by RSI and dMY and which participate in a Permitted Equity Financing.

 

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NYSE proposal” means the proposal to approve the issuance of more than 20% of our issued and outstanding common stock (i) pursuant to the terms of the Business Combination Agreement, (ii) upon the exchange of the Retained RSI Units pursuant to the RSI A&R LPA and (iii) the issuance of Class A Common Stock in connection with the Subscription Agreements in connection with the Business Combination, in each case, that may result in Sellers or any other investor acquiring shares pursuant to a Subscription Agreement owning more than 20% of our outstanding common stock, or more than 20% of the voting power, which could constitute a “change of control” under NYSE rules.

PIPE” means a private investment in a public entity.

PIPE Investors” means the subscribers that agreed to purchase Class A Common Stock at the Closing pursuant to the PIPE, including, without limitation, as reflected in the Subscription Agreements.

Plan” means the Rush Street Interactive, Inc. 2020 Omnibus Equity Incentive Plan, a copy of which is attached to this proxy statement as Annex C. For additional information, see “The Incentive Plan Proposal” section of this proxy statement.

Proposed Charter” means the second amended and restated certificate of incorporation, as further amended, of the Company which, if approved, would take effect upon the Closing Date.

Purchased RSI Units” means a number of Retained RSI Units (not to exceed (a) 12,500,000 RSI Units in the event that the Put-Calls are not in effect as of the Closing or (b) 9,923,550 RSI Units in the event that the Put-Calls are in effect as of the Closing) equal to the quotient of (a) the Purchased RSI Units Cash Consideration divided by (b) $10. For the avoidance of doubt, the Purchased RSI Units shall not include any Sellers Earnout Company Units and if, and only if, the Closing occurs on or prior to December 20, 2020, the Purchased RSI Units shall not include any Put-Call Units.

Purchased RSI Units Cash Consideration” means, to the extent that the Available Closing Date Cash exceeds $160,000,000, an amount of the Available Closing Date Cash (not to exceed $125,000,000) determined by calculating (1) the sum of (i) the Available Closing Date Cash less $160,000,000 (provided that the amount of cash attributable to this clause (i) is subject to a cap of $60,000,000) plus (ii) 50% of the amount by which the Available Closing Date Cash exceeds $220,000,000 (provided that the amount of cash attributable to this clause (ii) is subject to a cap of $65,000,000) minus (2) the Aggregate Put-Call Consideration Amount (if any).

Put-Call Agreements” those certain Put-Call Agreements, dated as of October 9, 2020, by and among the Company, RSI and each of the Put-Call Sellers.

Put-Call Consideration Amount” mean, with respect to a Put-Call Seller, if, and only if, the Closing occurs on or prior to December 20, 2020, the amount equal to (a) the Seller Proportion applicable to such Put-Call Seller multiplied by (b) the amount equal to (1) the sum of (i) the Available Closing Date Cash less $160,000,000 (provided that the amount of cash attributable to this clause (i) is subject to a cap of $60,000,000) plus (ii) 50% of the amount by which the Available Closing Date Cash exceeds $220,000,000 (provided that the amount of cash attributable to this clause (ii) is subject to a cap of $65,000,000). For the avoidance of doubt, if, and only if, the Closing occurs after December 20, 2020, the Put-Call Consideration Amount with respect to each Put-Call Seller shall be equal to zero dollars ($0).

Put-Call Sellers” means each of Richard Schwartz, Einar Roosileht and Mattias Stetz.

Put-Calls” means those put and call rights contemplated by the Put-Call Agreements, which rights will be effective if, and only if, the Closing occurs on or prior to December 20, 2020 and which rights and Put-Call Agreements will automatically terminate and no longer be effective if the Closing occurs after December 20, 2020.

 

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Retained RSI Units” mean those RSI Units that are retained by the Sellers pursuant to the Business Combination Agreement.

RSI” refers to Rush Street Interactive, L.P., a Delaware limited partnership.

RSI A&R LPA” means the Amended and Restated Agreement of Limited Partnership of RSI.

RSI Enterprise Value” means $1,725,000,000.

RSI GP” means RSI GP, LLC, a Delaware limited liability company and wholly-owned subsidiary of the Company.

RSI Units” means the common units of RSI, following the transactions contemplated by the Recapitalization Agreement.

Securities Act” means the Securities Act of 1933, as amended.

Seller” means each of Rush Street Interactive GP, LLC, Greg and Marcy Carlin Family Trust, Gregory Carlin, Rush Street Investors, LLC, Neil Bluhm, NGB 2013 Dynasty Trust, Einar Roosileht, Richard Schwartz and Mattias Stetz.

Seller Proportions” means, with respect to each Put-Call Seller, the proportion expressed as a percentage and delivered to the Company by RSI prior to the Closing pursuant to the Business Combination Agreement.

Sellers’ Representative” means Rush Street Interactive GP, LLC, in its capacity as the Sellers’ representative.

Sellers Earnout Company Units” means 15,000,000 of the Retained RSI Units held by the Sellers.“Special Limited Partner” means RSI ASLP, Inc., a Delaware corporation and wholly-owned subsidiary of the Company.

Sponsor” means the Company’s sponsor, dMY Sponsor, LLC.

Unsuitable Person” means a stockholder of the Company who (i) fails or refuses to file an application within thirty (30) days (or such other period imposed by any Gaming Authority) after having been requested in writing and in good faith to do the same by the Company (based on consultation with independent gaming regulatory counsel), or has withdrawn or requested the withdrawal of a pending application (other than for technical reasons with the intent to promptly file an amended application following such withdrawal), to be found suitable by any Gaming Authority or for any Gaming License, in each case, when such finding of suitability or Gaming License is required by Gaming Laws or Gaming Authorities for the purpose of obtaining a material Gaming License for, or compliance with material Gaming Laws by, the Company or any Affiliated Company, (ii) is denied or disqualified from eligibility for any material Gaming License by any Gaming Authority, (iii) is determined by a Gaming Authority in any material Gaming Jurisdiction to be unsuitable to own or control any Class A Common Stock, Class V Voting Stock or any other equity securities of the Company, or securities exchangeable or exercisable for, or convertible into, such other equity securities of the Company, or be Affiliated, associated or involved with a Person engaged in Gaming Activities, (iv) is determined by a Gaming Authority to have caused in whole or in part any material Gaming License of the Company or any Affiliated Company to be lost, rejected, rescinded, suspended, revoked or not renewed by any Gaming Authority, or to have caused in whole or in part the Company or any Affiliated Company to be threatened in writing by any Gaming Authority with the loss, rejection, rescission, suspension, revocation or non-renewal of any material Gaming License, or (v) is reasonably likely to (A) preclude or materially delay, impede, impair, threaten or jeopardize (1) any material Gaming License held or desired in good faith to be held by the Company or any Affiliated Company or (2) the Company’s or any Affiliated Company’s application for, right to the use of, entitlement to, or ability to

 

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obtain or retain, any material Gaming License held or desired in good faith to be field by the Company or any Affiliated Company, or (B) cause or otherwise be reasonably likely to result in the imposition of any materially burdensome terms or conditions on any material Gaming License held or desired to be held by the Company or any Affiliated Company.

TRADEMARKS

This proxy statement includes RSI’s trademarks such as “21+3”, “Lucky Lady” and “Lucky,” which are protected under applicable intellectual property laws and are the property of RSI or its subsidiaries. This proxy statement also contains trademarks, service marks, trade names and copyrights of other companies, which are the property of their respective owners. Solely for convenience, trademarks and trade names referred to in this proxy statement may appear without the ® or TM symbols, but such references are not intended to indicate, in any way, that we will not assert, to the fullest extent under applicable law, our rights or the right of the applicable licensor to these trademarks and trade names.

 

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CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS AND RISK FACTOR SUMMARY

The statements contained in this proxy statement that are not purely historical are forward-looking statements. Our forward-looking statements include, but are not limited to, statements regarding our or our management team’s expectations, hopes, beliefs, intentions or strategies regarding the future. The information included in this proxy statement in relation to RSI has been provided by RSI and its management team, and forward-looking statements include statements relating to RSI’s management team’s expectations, hopes, beliefs, intentions or strategies regarding the future. In addition, any statements that refer to projections, forecasts or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. The words “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intends,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “would” and similar expressions may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. Forward-looking statements in this proxy statement may include, for example, statements about:

 

   

our ability to complete the Business Combination, or, if we do not consummate the Business Combination, any other initial business combination;

 

   

the benefits of the Business Combination;

 

   

the future financial performance of the Company following the Business Combination;

 

   

expansion plans and opportunities; and

 

   

our potential ability to obtain financing to complete the Business Combination.

The forward-looking statements contained in this proxy statement are based on our current expectations and beliefs concerning future developments and their potential effects on us. There can be no assurance that future developments affecting us will be those that we have anticipated. These forward-looking statements involve a number of risks, uncertainties (some of which are beyond our control) or other assumptions that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements. These risks and uncertainties include, but are not limited to, the items in the following list, which summarizes some of the principal risks relating to the Business Combination and dMY and RSI’s businesses:

 

   

satisfaction of conditions to the Business Combination;

 

   

the occurrence of any event, change or other circumstances that could give rise to the termination of the Business Combination Agreement;

 

   

the ability to obtain and/or maintain the listing of our Class A Common Stock on the NYSE following the Business Combination;

 

   

our ability to raise financing in the future;

 

   

our success in retaining or recruiting, or changes required in, our officers, key employees or directors following the Business Combination;

 

   

our officers and directors allocating their time to other businesses and potentially having conflicts of interest with our business or in approving the Business Combination, as a result of which they would then receive expense reimbursements;

 

   

our public securities’ potential liquidity and trading;

 

   

the use of proceeds not held in the trust account or available to us from interest income on the trust account balance;

 

   

competition in the retail and online sports wagering and online gaming industry is intense and, as a result, RSI may fail to attract and retain users, which may negatively impact RSI’s operations and growth prospects;

 

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economic downturns and political and market conditions beyond RSI’s control, including a reduction in consumer discretionary spending and sports leagues shortening, delaying or cancelling their seasons due to COVID-19, could adversely affect its business, financial condition, results of operations and prospects;

 

   

RSI’s projections, including for revenues, market share, expenses and profitability, are subject to significant risks, assumptions, estimates and uncertainties;

 

   

RSI’s growth prospects may suffer if it is unable to develop successful offerings, if it fails to pursue additional offerings or if it loses any of its key executives or other key employees;

 

   

RSI may be subject to litigation in the operation of its business and RSI’s insurance may not provide adequate levels of coverage against any claims;

 

   

the requirements of being a public company, including compliance with the SEC’s requirements regarding internal controls over financial reporting, may strain RSI’s resources and divert management’s attention, and the increases in legal, accounting and compliance expenses that will result from the Business Combination may be greater than RSI anticipates;

 

   

following the consummation of the Business Combination, RSI will be dependent on RSG and certain of its affiliates to provide it with certain services, which may not be sufficient to meet its needs, and RSI may have difficulty finding replacement services or be required to pay increased costs to replace these services to the extent that its services agreement with RSG terminates;

 

   

RSI’s business is subject to a variety of United States and foreign laws (including Colombia, where RSI has business operations), many of which are unsettled and still developing, and RSI’s growth prospects depend on the legal status of real-money gaming in various jurisdictions;

 

   

failure to comply with regulatory requirements or to successfully obtain a license or permit applied for could adversely impact RSI’s ability to comply with licensing and regulatory requirements or to obtain or maintain licenses in other jurisdictions, or could cause financial institutions, online and mobile platforms and distributors to stop providing services to RSI;

 

   

RSI relies on information technology and other systems and platforms (including reliance on third-party providers to validate the identity and identify the location of its users and to process deposits and withdrawals made by its users), and any breach or disruption of such information technology could compromise RSI’s networks and the information stored there could be accessed, publicly disclosed, lost or stolen;

 

   

RSI intends to license certain trademarks and domain names to RSG and its affiliates, and RSG’s and its affiliates’ use of such trademarks and domain names, or failure to protect or enforce RSI’s intellectual property rights, could harm RSI’s business, financial condition, results of operations and prospects.

 

   

RSI will rely on licenses and service agreements to use the intellectual property rights of third parties which are incorporated into or used in its products and services; and

 

   

RSI may invest in or acquire other businesses, or may invest or spend the proceeds of the Business Combination in ways with which the investors may not agree or which may not yield a return, and RSI’s business may suffer if it is unable to successfully integrate acquired businesses into its company or otherwise manage the growth associated with multiple acquisitions.

 

   

other factors detailed under the section entitled “Risk Factors” herein and in our Annual Report on Form 10-K for the year ended December 31, 2019.

Should one or more of these risks or uncertainties materialize, or should any of our assumptions prove incorrect, actual results may vary in material respects from those projected in these forward-looking statements.

 

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We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws. Before a stockholder grants its proxy or instructs how its votes should be cast or vote on the proposals set forth in this proxy statement, it should be aware that the occurrence of the events described in the “Risk Factors” section and elsewhere in this proxy statement may adversely affect dMY or RSI.

 

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QUESTIONS AND ANSWERS ABOUT THE PROPOSALS

The following questions and answers briefly address some commonly asked questions about the proposals to be presented at the special meeting, including the Business Combination. The following questions and answers do not include all the information that is important to our stockholders. We urge our stockholders to read carefully this entire proxy statement, including the annexes and other documents referred to herein.

 

Q:

Why am I receiving this proxy statement?

 

A:

dMY is proposing to consummate a business combination with RSI. dMY and RSI have entered into the Business Combination Agreement, the terms of which are described in this proxy statement. You are being asked to consider and vote on the Business Combination. The Business Combination Agreement, among other things, provides that, (i) the Sellers will retain the number of RSI Units (the “Retained RSI Units”) that will cause the Sellers’ aggregate percentage ownership in RSI immediately following the closing of the Business Combination (the “Closing”) to be equal to the percentage determined as the quotient of (a) RSI’s enterprise value (i.e., $1,725,000,000) (the “RSI Enterprise Value”) divided by (b) the sum of (1) the RSI Enterprise Value plus (2) the product of (A) the total number of outstanding shares of Class A Common Stock, par value $0.0001 per share, of the Company (the “Class A Common Stock”) issued and outstanding as of immediately prior to the Closing (after giving effect to any redemptions of Class A Common Stock by the Company’s current stockholders, the conversion of all then-outstanding shares of Class B Common Stock, par value $0.0001 per share, of the Company (the “Class B Common Stock”) into shares of Class A Common Stock on a one-for-one basis (the “Class B Common Stock Conversion”), and any Class A Common Stock purchased in connection with any Permitted Equity Financing consummated on or prior to the Closing (the “PIPE”)) multiplied by (B) $10; (ii) the Sellers (other than the Put-Call Sellers to the extent that the Put-Calls are in effect as of the Closing) will transfer to the Special Limited Partner a number of Retained RSI Units (not to exceed (a) 12,500,000 RSI Units to the extent that the Put-Calls are not in effect as of the Closing or (b) 9,923,550 RSI Units to the extent that the Put-Calls are in effect as of the Closing) equal to the quotient of (a) the Purchased RSI Units Cash Consideration (as defined below) divided by (b) $10 (the “Purchased RSI Units” which, for the avoidance of doubt, excludes any Put-Call Units to the extent that the Put-Calls are in effect as of the Closing)); (iii) the Company will issue to RSI (for immediate further distribution to the Sellers) the number of shares of newly issued Class V Voting Stock, par value $0.0001 per share, of the Company (the “Class V Voting Stock”) equal to the number of Retained RSI Units (net of the number of Purchased RSI Units, but including the number of Put-Call Units to the extent that the Put-Calls are in effect as of the Closing), which will entitle its holder to one vote per share but not any right to dividends or distributions; (iv) the Special Limited Partner will contribute cash to RSI in the amount of the Contribution Amount (as defined below) in exchange for a number of RSI Units equal to the aggregate number of shares of Class A Common Stock outstanding as of the Closing (after giving effect to any redemptions of Class A Common Stock by the Company’s current stockholders, the Class B Common Stock Conversion, and any Class A Common Stock purchased in connection with the PIPE) minus the number of Purchased RSI Units; (v) RSI GP, a wholly-owned subsidiary of the Company, will acquire 100% of the non-economic partnership interests of RSI; and (vi) if the Closing occurs on or prior to December 20, 2020, the Put-Calls will be effective and beginning on December 21, 2020 until December 28, 2020, the Put-Call Sellers will have the right to sell to RSI, and RSI will have the right to purchase from the Put-Call Sellers, the Put-Call Units, on the terms and subject to the conditions set forth in the Business Combination Agreement and the Put-Call Agreements.

Pursuant to the Business Combination Agreement, “Available Closing Date Cash” will be equal to the sum of (i) the cash remaining in the Company’s trust account as of immediately prior to the Closing following any redemptions of Class A Common Stock by the Company’s current stockholders and payment of the aggregate amount of transaction expenses incurred by the parties to the Business Combination Agreement as of the Closing plus (ii) the aggregate amount of proceeds received by the Company at or prior to the Closing in connection with the PIPE. To the extent that the Available Closing Date Cash exceeds

 

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$160,000,000, an amount of the Available Closing Date Cash (not to exceed (a) $125,000,000 in the event that the Put-Calls are not in effect as of the Closing or (b) $99,235,500 in the event that the Put-Calls are in effect as of the Closing) determined by calculating (A) the sum of (i) the Available Closing Date Cash less $160,000,000 (provided that the amount of cash attributable to this clause (i) is subject to a cap of $60,000,000) plus (ii) 50% of the amount by which the Available Closing Date Cash exceeds $220,000,000 (provided that the amount of cash attributable to this clause (ii) is subject to a cap of $65,000,000) minus (B) the Aggregate Put-Call Consideration Amount (such amount determined by subtracting the amount in clause (B) from the amount in clause (A), the “Purchased RSI Units Cash Consideration”) will be used to purchase from the Sellers (other than the Put-Call Sellers to the extent that the Put-Calls are in effect as of the Closing) the Purchased RSI Units and the remainder of the Available Closing Date Cash (which will include the Aggregate Put-Call Consideration Amount (if any)) will be contributed to RSI in exchange for the Issued RSI Units (such contributed amount, the “Contribution Amount”).

Furthermore, pursuant to the Business Combination Agreement, if the Closing occurs on or prior to December 20, 2020 and the Put-Call is therefore effective, the Put-Call Sellers will retain their Put-Call Units and Aggregate Put-Call Consideration Amount will comprise a portion of the Contribution Amount and will be contributed by the Company to RSI at the Closing (for use in connection with the exercise, if any, of the Put-Calls or for any other use determined by RSI). If the Closing occurs after December 20, 2020, the Put-Call Agreements will automatically terminate and no longer be effective and the Put-Call Units held by the Put-Call Sellers will be sold to the Company at the Closing as Purchased RSI Units or redeemed by RSI following the Closing in accordance with the Business Combination Agreement.

Consummation of the business combination proposal requires the approval of holders of at least a majority of the shares of Class A Common Stock and Class B Common Stock that are voted in person (which would include presence at the virtual special meeting) or by proxy at the special meeting.

YOUR VOTE IS IMPORTANT. STOCKHOLDERS ARE URGED TO SUBMIT THEIR PROXIES AS SOON AS POSSIBLE AFTER CAREFULLY REVIEWING THIS PROXY STATEMENT.

 

Q:

Why is dMY proposing the Business Combination?

 

A:

dMY was organized to effect a merger, capital stock exchange, asset acquisition or other similar business combination with one or more businesses or entities.

See “The Business Combination Proposal — Interests of Certain Persons in the Business Combination.”

 

Q:

What will RSI’s equity holders receive in return for the acquisition of RSI by dMY?

 

A:

Pursuant to the Business Combination Agreement, the aggregate consideration payable or issuable by the Company in exchange for the Issued RSI Units is comprised of (i) an amount in cash equal to the Contribution Amount (as defined below), and (ii) the Class V Voting Stock issued to the Sellers as described above. The Company, the Special Limited Partner, RSI, the Sellers and the Sellers’ Representative will also enter into a customary Tax Receivable Agreement which will provide for the sharing of certain tax benefits relating to tax attributes generated by the transaction and subsequent exchanges by the Sellers of their RSI Units for shares of Class A Common Stock (as further discussed and described below).

Pursuant to the Business Combination Agreement, “Available Closing Date Cash” will be equal to the sum of (i) the cash remaining in the Company’s trust account as of immediately prior to the Closing following any redemptions of Class A Common Stock by the Company’s current stockholders and payment of the aggregate amount of transaction expenses incurred by the parties to the Business Combination Agreement as of the Closing plus (ii) the aggregate amount of proceeds received by the Company at or prior to the Closing in connection with the PIPE. To the extent that the Available Closing Date Cash exceeds

 

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$160,000,000, an amount of the Available Closing Date Cash (not to exceed (a) $125,000,000 in the event that the Put-Calls are not in effect as of the Closing or (b) $99,235,500 in the event that the Put-Calls are in effect as of the Closing) determined by calculating (A) the sum of (i) the Available Closing Date Cash less $160,000,000 (provided that the amount of cash attributable to this clause (i) is subject to a cap of $60,000,000) plus (ii) 50% of the amount by which the Available Closing Date Cash exceeds $220,000,000 (provided that the amount of cash attributable to this clause (ii) is subject to a cap of $65,000,000) minus (B) the Aggregate Put-Call Consideration Amount (such amount determined by subtracting the amount in clause (B) from the amount in clause (A), the “Purchased RSI Units Cash Consideration”) will be used to purchase from the Sellers (other than the Put-Call Sellers to the extent that the Put-Calls are in effect as of the Closing) the Purchased RSI Units and the remainder of the Available Closing Date Cash (which will include the Aggregate Put-Call Consideration Amount (if any)) will be contributed to RSI in exchange for the Issued RSI Units (such contributed amount, the “Contribution Amount”).

Additionally, in the event the Company receives additional proceeds through Permitted Equity Financing Sources during the five business day period following the Closing Date (provided that the aggregate proceeds received in connection with the PIPE and during the five business day period following the Closing Date may not exceed $245,000,000), the Company will cause such amounts to be contributed to the Special Limited Partner, which will contribute such amounts to RSI (the “Post-Closing Contribution Amount”), and in exchange, RSI will issue to the Special Limited Partner additional RSI Units, in an amount equal to the number of shares of Class A Common Stock sold by the Company to such equity financing sources, at the price at which the shares of Class A Common Stock were sold by the Company to such equity financing sources (which price may not be less than $10.00 per share). Thereafter, so long as the Sellers (other than the Put-Call Sellers to the extent that the Put-Calls are in effect as of the Closing) have not already sold to the Special Limited Partner (x) 12,500,000 RSI Units (in the event that the Put-Calls are not in effect as of the Closing) or (y) 9,923,550 RSI Units (in the event that the Put-Calls are in effect as of the Closing), a portion of the Post-Closing Contribution Amount equal to the Redemption Amount (as defined below) will be used to redeem from the Sellers a number of Retained RSI Units equal to (i) the Redemption Amount divided by (ii) $10.00. In connection with such redemption, the Sellers (other than the Put-Call Sellers to the extent that the Put-Calls are in effect as of the Closing) will forfeit a corresponding number of shares of Class V Voting Stock held by the Sellers. The Purchased RSI Units Cash Consideration and the portion of the Post-Closing Contribution Amount payable to the Sellers (other than the Put-Call Sellers to the extent that the Put-Calls are in effect as of the Closing) will not in the aggregate exceed (1) $125,000,000 (in the event that the Put-Calls are not in effect as of the Closing) or (2) $99,235,500 (in the event that the Put-Calls are in effect as of the Closing). Pursuant to the Business Combination Agreement, “Redemption Amount” means the amount equal to the difference of (a) the sum of (i) the Available Closing Date Cash plus the aggregate proceeds received by the Company from any Permitted Equity Financing consummated after the Closing and on or prior to the fifth business day following the Closing Date less $160,000,000 (provided that the amount of cash attributable to this clause (i) will not be less than zero or exceed $60,000,000) plus (ii) the positive product (if any) of (A) 50% multiplied by (B) the amount by which the Available Closing Date Cash plus the aggregate proceeds received by the Company from any Permitted Equity Financing consummated after the Closing and on or prior to the fifth business day following the Closing Date exceeds $220,000,000 (provided that the amount of cash attributable to this clause (ii) will in no event be less than zero or exceed $65,000,000) minus (b) the Purchased RSI Units Cash Consideration minus (c) the Aggregate Put-Call Consideration Amount, if any.

 

Q:

Will dMY obtain new financing in connection with the Business Combination?

 

A:

Yes. In connection with the execution of the Business Combination Agreement, (i) the Company entered into a subscription agreement with certain funds and accounts managed by Fidelity Management & Research Company LLC (the “Fidelity Subscription Agreement”) and (ii) the Company, the Sellers’

 

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  Representative and certain other subscribers entered into subscription agreements (the “Other Subscription Agreements,” together with the Fidelity Subscription Agreement, the “Subscription Agreements”), pursuant to which, such investors have agreed to purchase as of immediately prior to the closing of the Business Combination (the “Closing”) an aggregate of 16,043,002 shares of Class A Common Stock, par value $0.0001 per share, of the Company (the “Class A Common Stock”) for a purchase price of $10.00 per share, for an aggregate purchase price of $160,430,020 (together, the “PIPE”). The obligations of each party to consummate the PIPE are conditioned upon, among other things, customary closing conditions and the consummation of the transactions contemplated by the Business Combination Agreement. In addition, the Company will be entitled to obtain additional proceeds through Permitted Equity Financing Sources during the five business day period following the Closing Date (provided that the aggregate proceeds received in connection with the PIPE and during the five business day period following the Closing Date may not exceed $245,000,000).

 

Q:

What are the principal differences between Class A Common Stock and Class V Voting Stock?

 

A:

After the Business Combination, the Class A Common Stock and Class V Voting Stock will constitute all of the classes of common stock of the Company and will possess all voting power for the election of directors of the Company and all other matters requiring stockholder action. Holders of the Class A Common Stock and Class V Voting Stock will be entitled to one vote per share and at all times vote together as one class on all matters submitted to a vote of the stockholders of the Company. The principal difference between the Class A Common Stock and Class V Voting Stock is that holders of the Class V Voting Stock will not be entitled to receive dividends, if declared by our board of directors (the “Board”), or to receive any portion of any assets in respect of such shares upon the liquidation, dissolution, distribution of assets or winding-up of the Company. In addition, pursuant to the RSI A&R LPA, following the six month anniversary of the Closing Date and subject to the terms and conditions of the RSI A&R LPA, the Sellers are entitled to cause RSI to redeem their Retained RSI Units for either shares of Class A Common Stock or, at the election of the general partner of RSI, depending on, among other things, the availability of cash at RSI and its other intended uses, the cash equivalent of the market value of a corresponding number of shares of Class A Common Stock and, in each case, a corresponding number of shares of Class V Voting Stock held by the Seller tendering RSI Units for redemption by RSI will automatically be cancelled for no consideration. Finally, shares of Class A Common Stock and Class V Voting Stock can only be transferred with their corresponding RSI Units in accordance with the RSI A&R LPA.

 

Q:

What voting interests will our current stockholders, Initial Stockholders, the PIPE Investors and the Sellers hold in the Company immediately after the consummation of the Business Combination?

 

A:

We anticipate that, upon completion of the Business Combination, the voting interests in the Company will be as set forth in the table below.*

 

     Assuming No
Redemptions of Public
Shares(1)
    Assuming Maximum
Redemptions of Public
Shares(2)
 

dMY’s Public Stockholders

     12.20     1.64

dMY’s Initial Stockholders

     2.41     1.85

PIPE Investors

     8.51     8.92

Sellers

     76.89     87.58

 

  (1)

Assumes that (i) none of the holders of public shares of Class A Common Stock exercise their redemption rights, (ii) the parties to the Business Combination Agreement incur $30 million of transaction expenses, (iii) the Put-Calls are in effect as of the Closing and are validly exercised shortly following the Closing or not in effect, (iv) the maximum amount of Purchased RSI Units are purchased from the Sellers (other than the Put-Call Sellers) (i.e., $99,235,500 if the Put-Calls are in

 

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  effect or $125,000,000 if the Put-Calls are not in effect) at Closing, (v) none of the 1,205,937 Founder Holders Forfeiture Shares are forfeited because the Available Closing Date Cash exceeds $245,000,000, (vi) the Earnout Shares are excluded unless and until such shares become earned in accordance with the Business Combination Agreement, (vii) there is no exercise at the Closing of the Sponsor’s 6,600,000 private placement warrants at an exercise price of $11.50 per share (which warrants are not exercisable until the later of 12 months from the closing of the IPO and 30 days after the completion of the Business Combination), (viii) none of the parties set forth above purchase shares of Class A Common Stock in the open market, (ix) there are no other issuances of equity interests of the Company prior to or in connection with the Closing and (x) there are no issuances of any shares of the Company’s Class A Common Stock within the five business days following the Closing to additional private placement investors or following the Closing under the Plan.

 

  (2)

Assumes that (i) the holders of 20,043,002 shares of Class A Common Stock exercise their redemption rights, (representing the maximum amount of public shares that can be redeemed to satisfy the Minimum Cash Condition), (ii) the parties to the Business Combination Agreement incur $30 million of transaction expenses, (iii) the Put-Calls are in effect as of the Closing but there are no Put-Call Units due to insufficient excess cash, (iv) no Purchased RSI Units are purchased from the Sellers due to insufficient excess cash, (v) per the Business Combination Agreement, the Initial Stockholders forfeit (on a pro rata basis) 1,205,937 Founder Holders Forfeiture Shares in the aggregate as the Available Closing Date Cash does not exceed $160,000,000, (vi) exclusion of the Sellers’, Company’s and Initial Stockholders’ Earnout Shares, (vii) no exercise of the Sponsor’s 6,600,000 private placement warrants at an exercise price of $11.50 per share (which warrants are not exercisable until the later of 12 months from the closing of the IPO and 30 days after the completion of the Business Combination), (viii) none of the parties set forth above purchase shares of Class A Common Stock in the open market, (ix) there are no other issuances of equity interests of the Company prior to or in connection with the Closing and (x) there are no issuances of any shares of the Company’s Class A Common Stock within the five business days following the Closing to additional private placement investors or following the Closing under the Plan.

* Upon completion of the Business Combination, dMY’s public stockholders, the Initial Stockholders and the PIPE Investors will hold shares of Class A Common Stock and the Sellers will hold shares of Class V Voting Stock.

If the actual facts are different than the assumptions set forth above, the voting percentages set forth above will be different. For example, there are currently outstanding an aggregate of 18,100,000 warrants to acquire our shares of Class A Common Stock, which are comprised of 6,600,000 private placement warrants held by our initial stockholders and 11,500,000 warrants sold as part of the units in the Company’s IPO (the “public warrants”). Each of our outstanding warrants is exercisable commencing on the later of 12 months from the closing of the IPO and 30 days following the Closing for one share of Class A Common Stock for one share of Class A Common Stock. If we assume that each outstanding warrant is exercised and one share of Class A Common Stock is issued as a result of such exercise, with payment to dMY of the exercise price of $11.50 per warrant for one share, our fully-diluted share capital would increase by a total of 18,100,000 shares, with approximately $208,150,000 paid to dMY to exercise the warrants. In addition, at the Closing there will be 1,212,813 Class A Common Stock held by the Initial Stockholders (after giving effect to the Class B Common Stock Conversion) and 15,000,000 shares of Class V Voting Stock held by the Sellers that are subject to earnout criteria in accordance with the Business Combination Agreement. If we assume that the earnout criteria are met, the holders of such Earnout Shares will become entitled to vote such shares and our fully-diluted voting stock would increase by a total of 16,212,813 shares. Furthermore, up to 1,205,937 shares of Class A Common Stock held by the Initial Stockholders (after giving effect to the Class B Common Stock Conversion) are subject to forfeiture and cancellation for no consideration if Total Measurable Cash (as defined in the Founder Holders Forfeiture Agreement) does not equal at least $245,000,000 (as more fully described in the Founder Holders Forfeiture Agreement). If we assume that Total Measurable Cash equals $245,000,000, the Initial

 

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Stockholders will become entitled to vote such shares and our fully-diluted voting stock would increase by a total of 1,205,937 shares. Furthermore, there may be up to 2,576,450 Put-Call Units outstanding at Closing depending on the amount of Available Closing Date Cash. If we assume that the Put-Call Units are not exercised after Closing in accordance with the terms and conditions of the Business Combination Agreement and the Put-Call Agreements, our fully-diluted share capital would be increased by up to 2,576,450 shares of Class V Voting Stock held by the Put-Call Sellers.

Following the Closing, certain Sellers, namely Neil G. Bluhm and Gregory A. Carlin and their respective trusts (collectively, the “Controlling Holders”), will own a majority of the Company’s outstanding common stock and, therefore, will control a majority of the voting power of the Company’s outstanding common stock. Furthermore, the Controlling Holders intend to enter into a voting agreement prior to the consummation of the Business Combination whereby they agree to vote together on certain matters presented to the Company’s stockholders for so long as the voting agreement is in effect. As a result, the Company will be a “controlled company” within the meaning of the corporate governance standards of the New York Stock Exchange, which status permits the Company to elect not to comply with certain corporate governance requirements as further described herein.

 

Q:

How will the Company and RSI be managed following the Business Combination?

 

A:

Following the Closing, the Company will be organized in an “Up-C” structure in which the business of RSI will continue to operate and in which the Company’s only assets will consist of shares in the Special Limited Partner and equity in RSI GP, and the Special Limited Partner’s only directly owned assets will consist of the Issued RSI Units. The Special Limited Partner and RSI GP will each be direct wholly-owned subsidiaries of the Company. The Special Limited Partner is expected to own between approximately 12.41% and 23.11% of the RSI Units. RSI GP will own 100% of the non-economic partnership interests of RSI and will be the sole manager of RSI pursuant to the RSI A&R LPA. As such, RSI GP, through its board of managers, will be responsible for all operational and administrative decisions of RSI and the day-to-day management of RSI’s business. Following the consummation of the Business Combination, the current management of RSI will become the members of the board of managers of RSI GP, certain members of current management of RSI and certain new independent directors appointed by the Sellers will become the management of the combined company, and Harry L. You and Niccolo de Masi will continue on as directors of the Company. Upon the Closing, the Company will change its name to “Rush Street Interactive, Inc.”

Please see the section entitled “Management of the Company Following the Business Combination” for further information.

 

Q:

What interests do our initial stockholders, current officers, directors and advisors, and RSI’s current owners have in the Business Combination?

 

A:

In considering the recommendation of our Board to vote in favor of the Business Combination, stockholders should be aware that, aside from their interests as stockholders, our Sponsor and our directors and officers and RSI’s current owners have interests in the Business Combination that are different from, or in addition to, those of our other stockholders generally. Our directors were aware of and considered these interests, among other matters, in evaluating the Business Combination, and in recommending to our stockholders that they approve the Business Combination. Stockholders should take these interests into account in deciding whether to approve the Business Combination. These interests include, among other things:

 

   

the fact that our initial stockholders have waived their right to redeem any of the founder shares and public shares in connection with a stockholder vote to approve a proposed initial business combination;

 

   

the fact that our initial stockholders paid an aggregate of $25,000 for the founder shares, which will convert into 5,750,000 shares of Class A Common Stock (of which 1,212,813 shares are subject to

 

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earnout (the “Initial Stockholders Earnout Shares”) in accordance with the Business Combination Agreement and 1,205,937 shares are subject to forfeiture in accordance with the Founder Holders Forfeiture Agreement (the “Initial Stockholders Forfeiture Shares”)) in accordance with the terms of the Charter and the amendment to a letter agreement, originally entered into on February 20, 2020, executed in connection with the Business Combination Agreement, by and among certain current officers and directors of the Company, the Sponsor, the Company, RSI and the Sellers’ Representative (the “Amended Insider Letter”), and such securities will have a significantly higher value at the time of the Business Combination, estimated at approximately $[•] based on the closing price of $10.[•] per public share on the NYSE on [•], 2020;

 

   

the fact that our initial stockholders have agreed to waive their rights to liquidating distributions from the trust account with respect to their founder shares if we fail to complete an initial business combination by February 25, 2022;

 

   

the fact that our Sponsor paid approximately $6,600,000 for 6,600,000 private placement warrants, each of such private placement warrants is exercisable commencing on the later of 12 months from the closing of the IPO and 30 days following the Closing for one share of Class A Common Stock for one share of Class A Common Stock at $11.50 per share; if we do not consummate an initial business combination by February 25, 2022, then the proceeds from the sale of the private placement warrants will be part of the liquidating distribution to the public stockholders and the warrants held by our Sponsor will be worthless; the warrants held by our Sponsor had an aggregate market value of approximately $[•] based upon the closing price of $0.[•] per warrant on the NYSE on [•], 2020;

 

   

the right of our Sponsor to receive approximately 6,600,000 shares of Class A Common Stock to be issued upon exercise of its private placement warrants following the Business Combination, subject to certain lock-up periods;

 

   

if the trust account is liquidated, including in the event we are unable to complete an initial business combination within the required time period, our Sponsor has agreed that it will be liable to us if and to the extent any claims by a third-party (other than our independent registered public accounting firm) for services rendered or products sold to us, or a prospective target business with which we have entered into a written letter of intent, confidentiality or other similar agreement or business combination agreement, reduce the amount of funds in the trust account to below: (i) $10.00 per public share; or (ii) such lesser amount per public share held in the trust account as of the date of the liquidation of the trust account due to reductions in the value of the trust assets, in each case, net of the interest which may be withdrawn to pay taxes and up to $100,000 of interest to pay dissolution expenses, except as to any claims by a third-party who executed a waiver of any and all rights to seek access to the trust account and except as to any claims under our indemnity of the underwriters of the IPO against certain liabilities, including liabilities under the Securities Act;

 

   

the anticipated election of Harry L. You and Niccolo de Masi, our Chairman and Chief Executive Officer, respectively, as directors of the Company after the consummation of the Business Combination. As such, in the future they will receive any cash fees, stock options or stock awards that the Board determines to pay to our directors;

 

   

pursuant to an Investor Rights Agreement, the Sponsor will have the right to nominate two directors to the Board and the Sellers will have the right to nominate the remaining directors of the Board and the Sellers will have the right to appoint up to three non-voting board observers to the Board, in each case subject to certain conditions;

 

   

the continued indemnification of our existing directors and officers and the continuation of our directors’ and officers’ liability insurance after the Business Combination;

 

   

the fact that the Sellers, who (i) will have the right to designate directors to the Board pursuant to the Investor Rights Agreement, and (ii) include members of RSI’s management team who will become executive officers and directors of the Company following the Business Combination, will hold a

 

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significant number of shares of Class V Voting Stock and an equal number of Retained RSI Units that are redeemable for shares of Class A Common Stock in accordance with the terms of the RSI A&R LPA; and

 

   

the fact that Goldman Sachs & Co. LLC (“Goldman”), the Company’s financial advisor and underwriters in the IPO, will be entitled to receive a deferred underwriting commission and a financial advisory fee upon completion of the business combination.

Please also see the sections “Certain Relationships and Related Party Transactions” and “Beneficial Ownership of Securities” for more information on the interests and relationships of our initial stockholders, current officers and directors, and RSI’s current owners.

 

Q:

What is an “Up-C” Structure?

 

A:

Our corporate structure following the Business Combination, as described under the section entitled “The Business Combination Proposal — The Business Combination Agreement,” is commonly referred to as an “Up-C” structure, which is often used by partnerships and limited liability companies when they undertake an IPO either directly or through a business combination with a special purpose acquisition company, such as dMY. The Up-C structure will allow the Sellers to continue to realize tax benefits associated with owning interests in an entity that is treated as a partnership, or “passthrough” entity, for United States federal income (and certain state and local) tax purposes following the Business Combination. One of these benefits is that, for United States federal income (and certain state and local) purposes, future taxable income of RSI that is allocated to the Sellers will be taxed on a flow-through basis and therefore will not be subject to corporate taxes at the entity level. See the sections entitled “The Business Combination Proposal” and “Description of Securities.”

 

Q:

What happens to the funds deposited in the trust account after consummation of the Business Combination?

 

A:

Upon the completion of the IPO, a total of $230,000,000 was placed in a trust account maintained by Continental Stock Transfer & Trust Company, acting as trustee. As of [•], 2020, there were investments and cash held in the trust account of approximately $[•] million. These funds will not be released until the earlier of the completion of our initial business combination and the redemption of our public shares if we are unable to complete an initial business combination by February 25, 2022, although we may withdraw the interest earned on the funds held in the trust account to pay taxes.

 

Q:

What happens if a substantial number of the public stockholders vote in favor of the Business Combination proposal and exercise their redemption rights?

 

A:

dMY’s public stockholders may vote in favor of the Business Combination and exercise their redemption rights. Accordingly, the Business Combination may be consummated even though the funds available from the trust account and the number of public stockholders are reduced as a result of redemptions by public stockholders.

However, the consummation of the Business Combination is conditioned upon, among other things, approval by dMY’s stockholders of the Business Combination Agreement and the Business Combination.

In addition, with fewer public shares and public stockholders, the trading market for Class A Common Stock may be less liquid than the market for shares of Class A Common Stock was prior to consummation of the Business Combination and the Company may not be able to meet the listing standards for the NYSE or another national securities exchange. In addition, with less funds available from the trust account, the working capital infusion from the trust account into the Company’s business will be reduced.

 

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Q:

What conditions must be satisfied to complete the Business Combination?

 

A:

Unless waived by the parties to the Business Combination Agreement, and subject to applicable law, the consummation of the Business Combination is subject to a number of conditions set forth in the Business Combination Agreement including, among other things, approval by RSI’s stockholders of the Business Combination Agreement and the Business Combination. In addition, unless waived by the Sellers’ Representative or the Company, and subject to applicable law, the consummation of the Business Combination is subject to the conditions that (x) the Company has Available Closing Date Cash of at least $160,000,000 minus the amount by which RSI’s and the Sellers’ transaction expenses incurred in connection with the Business Combination exceeds $12,500,000, and (y) that all approvals, determinations, grants, confirmations and other conditions with respect to gaming regulatory authorities in connection with the transactions contemplated by the Business Combination Agreement and the Ancillary Agreements have been made, obtained, satisfied or given and in full force and effect. Unless waived, if any of these conditions are not satisfied, the Business Combination may not be consummated. Furthermore, in no event will we redeem our public shares in an amount that would cause our net tangible assets to be less than $5,000,001.

 

Q:

What happens if the Business Combination is not consummated?

 

A:

If we are not able to complete the Business Combination with RSI or another initial business combination by February 25, 2022, we will cease all operations except for the purpose of winding up and redeeming our public shares and liquidating the trust account, in which case our public stockholders may only receive approximately $10.00 per share and our warrants will expire worthless. In addition, the underwriters of the IPO, including Goldman, agreed to waive their rights to their deferred underwriting commission held in the trust account in the event we do not complete our initial business combination within the required time period.

 

Q:

When do you expect the Business Combination to be completed?

 

A:

It is currently anticipated that the Business Combination will be consummated as soon as practicable following the special meeting, which is set for [•], 2020; however, (i) such meeting could be adjourned if the adjournment proposal is adopted by our stockholders at the special meeting and we elect to adjourn the special meeting to a later date or dates to permit further solicitation and vote of proxies if, based upon the tabulated vote at the time of the special meeting, any of the condition precedent proposals has not been approved, and (ii) the Closing will not occur until all conditions set forth in the Business Combination Agreement are satisfied or waived, including that all approvals, determinations, grants, confirmations and other conditions with respect to gaming regulatory authorities in connection with the transactions contemplated by the Business Combination Agreement and the Ancillary Agreements have been made, obtained, satisfied or given and in full force and effect, which may or may not be obtained prior to the special meeting. For a description of the conditions for the completion of the Business Combination, see “The Business Combination Proposal — The Business Combination Agreement — Conditions to the Closing of the Business Combination.”

 

Q:

What proposals are stockholders being asked to vote upon?

 

A:

Under the Business Combination Agreement, the approval of the condition precedent proposals is a condition to the consummation of the Business Combination. If our public stockholders do not approve each of the condition precedent proposals, then the Business Combination may not be consummated.

In addition, as required by applicable SEC guidance to give stockholders the opportunity to present their separate views on important corporate governance provisions, the Company is requesting that our stockholders vote upon, on a non-binding advisory basis, a proposal to approve certain amendments contained in the Proposed Charter that materially affect stockholder rights, which are amendments that will

 

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be made to the Charter as reflected in the Proposed Charter if the charter amendment proposal is approved. See “The Charter Amendment Proposal.” This separate vote is not otherwise required by Delaware law separate and apart from the charter amendment proposal, but pursuant to SEC guidance, the Company is required to submit these provisions to our stockholders separately for approval. However, the stockholder vote regarding these proposals are advisory votes, and are not binding on the Company or our Board (separate and apart from the approval of the charter amendment proposal). Furthermore, the Business Combination is not conditioned on the separate approval of the advisory charter proposals (separate and apart from approval of the charter amendment proposal).

The stockholders are also being asked to vote upon proposals to elect nine members of the Board, effective as of the Closing. See “The Director Election Proposal.”

In addition to the foregoing proposals, the stockholders also may be asked to consider and vote upon a proposal to adjourn the special meeting to a later date or dates to permit further solicitation and vote of proxies if (1) based upon the tabulated vote at the time of the special meeting, each of the condition precedent proposals has not been approved and/or (2) dMY determines that one or more of the closing conditions under the Business Combination Agreement has not been satisfied. See “The Adjournment Proposal.”

dMY will hold the special meeting of our stockholders to consider and vote upon these proposals. This proxy statement contains important information about the Business Combination and the other matters to be acted upon at the special meeting. Stockholders should read it carefully.

After careful consideration, the Board has unanimously approved the Business Combination Agreement and the transactions contemplated thereby and determined that the business combination proposals, the charter amendment proposal, each of the advisory charter proposals, the NYSE proposal, the incentive plan proposal, the director election proposal and the adjournment proposal is in the best interests of dMY and its stockholders and unanimously recommends that you vote “FOR”or give instruction to vote “FOR” each of these proposals.

The existence of financial and personal interests of our directors and officers may result in conflicts of interest, including a conflict between what may be in the best interests of the Company and its stockholders and what may be best for a director’s personal interests when determining to recommend that stockholders vote for the proposals. See the sections entitled “The Business Combination Proposal — Interests of Certain Persons in the Business Combination” and “Beneficial Ownership of Securities in the accompanying proxy statement for a further discussion.

THE VOTE OF STOCKHOLDERS IS IMPORTANT. STOCKHOLDERS ARE URGED TO SUBMIT THEIR PROXIES AS SOON AS POSSIBLE AFTER CAREFULLY REVIEWING THIS PROXY STATEMENT.

 

Q:

What material negative factors did the Board consider in connection with the Business Combination?

 

A:

Although the Board believes that the acquisition of RSI will provide our stockholders with an opportunity to participate in a combined company that is well positioned to benefit from a shift toward e-gaming from land-based gaming and trends in social, free-to-play gaming and is well aligned with all the key factors central to dMY’s strategy, the Board did consider certain potentially material negative factors in arriving at that conclusion, such as the risk that stockholders would not approve the Business Combination, the risk that the parties do not obtain all approvals, determinations, grants, confirmations and other conditions with respect to gaming regulatory authorities in connection with the transactions contemplated by the Business Combination Agreement and the Ancillary Agreements, and the risk that a significant number of stockholders would exercise their redemption rights. These factors are discussed in greater detail in the section entitled “The Business Combination Proposal Interests of Certain Persons in the Business Combination,” as well as in the section entitled “Risk Factors — Risks Relating to dMY and the Business Combination.”

 

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Q:

Do I have redemption rights?

 

A:

If you are a holder of public shares, you have the right to request that dMY redeem all or a portion of your public shares for cash provided that you follow the procedures and deadlines described elsewhere in this proxy statement. Public stockholders may elect to redeem all or a portion of such public stockholder’s public shares even if they vote for the business combination proposal. We sometimes refer to these rights to elect to redeem all or a portion of the public shares into a pro rata portion of the cash held in the trust account as “redemption rights.” If you wish to exercise your redemption rights, please see the answer to the next question, “How do I exercise my redemption rights?

Notwithstanding the foregoing, a holder of public shares, together with any affiliate of such public stockholder or any other person with whom such public stockholder is acting in concert or as a “group” (as defined in Section 13 of the Exchange Act), will be restricted from redeeming its public shares with respect to more than an aggregate of 20% of the public shares, without our prior consent. Accordingly, if a public stockholder, alone or acting in concert or as a group, seeks to redeem more than 20% of the public shares, then any such shares in excess of that 20% limit would not be redeemed for cash, without our prior consent.

Our initial stockholders entered into a letter agreement, pursuant to which they have agreed to waive their redemption rights with respect to their founder shares and public shares in connection with the completion of a business combination.

The consummation of the Business Combination is conditioned upon, among other things, approval by dMY’s stockholders of the Business Combination Agreement and the Business Combination. Unless waived, if any of these conditions are not satisfied, the Business Combination may not be consummated. Furthermore, in no event will we redeem our public shares in an amount that would cause our net tangible assets to be less than $5,000,001. See “The Business Combination Proposal — The Business Combination Agreement.”

 

Q:

How do I exercise my redemption rights?

 

A:

If you are a holder of public shares and wish to exercise your right to redeem your public shares, you must:

 

  (i)

(a) hold public shares or (b) hold public shares through units and elect to separate your units into the underlying public shares and public warrants prior to exercising your redemption rights with respect to the public shares; and

 

  (ii)

prior to 10:00 AM, Eastern Time, on [•], 2020 (two business days prior to the vote at the special meeting) (a) submit a written request to the transfer agent that the Company redeem your public shares for cash and (b) deliver your public shares to the transfer agent, physically or electronically through DTC.

The address of the transfer agent is listed under the question “Who can help answer my questions?” below.

Holders of units must elect to separate the underlying public shares and public warrants prior to exercising redemption rights with respect to the public shares. If holders hold their units in an account at a brokerage firm or bank, holders must notify their broker or bank that they elect to separate the units into the underlying public shares and public warrants, or if a holder holds units registered in its own name, the holder must contact the transfer agent directly and instruct it to do so.

Any holder of public shares will be entitled to request that their public shares be redeemed for 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 the Business Combination, including interest earned on the funds held in the trust account (net of taxes payable), divided by the number of then-outstanding public shares. For illustrative purposes, as of [•], 2020, this would have amounted to approximately $10.[•] per public share. However, the proceeds deposited in the trust account could become subject to the claims of

 

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our creditors, if any, which could have priority over the claims of our public stockholders, regardless of whether such public stockholders vote for or against the business combination proposal. Therefore, the per share distribution from the trust account in such a situation may be less than originally anticipated due to such claims. Your vote on any proposal other than the business combination proposal will have no impact on the amount you will receive upon exercise of your redemption rights. We anticipate that the funds to be distributed to public stockholders electing to redeem their public shares will be distributed promptly after the consummation of the Business Combination.

If you are a holder of public shares, you may exercise your redemption rights by submitting your request in writing to the transfer agent at the address listed at the end of this section.

Any request for redemption, once made by a holder of public shares, may be withdrawn at any time until the deadline for exercising redemption requests and thereafter, with our consent, until the Closing. If you deliver your shares for redemption to the transfer agent and later decide prior to Closing not to elect redemption, you may request that dMY instruct our transfer agent to return the shares (physically or electronically). You may make such request by contacting the transfer agent at the phone number or address listed at the end of this section. We will be required to honor such request only if made prior to the deadline for exercising redemption requests.

Any corrected or changed written exercise of redemption rights must be received by the transfer agent prior to the deadline for exercising redemption requests and, thereafter, with our consent, prior to Closing. No request for redemption will be honored unless the holder’s stock has been delivered (either physically or electronically) to the transfer agent by 10:00 AM Eastern Time, on [•], 2020.

If a holder of public shares properly makes a request for redemption and the public shares are delivered as described above, then, if the Business Combination is consummated, the Company will redeem public shares for a pro rata portion of funds deposited in the trust account, calculated as of two business days prior to the consummation of the Business Combination.

If you are a holder of public shares and you exercise your redemption rights, it will not result in the loss of any dMY warrants that you may hold.

 

Q:

Will how I vote on the Business Combination proposal affect my ability to exercise redemption rights?

 

A:

No. You may exercise your redemption rights irrespective of whether you vote your Class A Common Stock for or against the Business Combination proposal or any other proposal described by this proxy statement. As a result, the Business Combination Agreement can be approved by stockholders who will redeem their public shares and no longer remain stockholders, leaving stockholders who choose not to redeem their shares holding shares in a company with a less liquid trading market, fewer stockholders, less cash and the potential inability to meet the listing standards of the NYSE.

 

Q:

If I am a holder of units, can I exercise redemption rights with respect to my units?

 

A:

No. Holders of outstanding units must elect to separate the units into the underlying public shares and public warrants prior to exercising redemption rights with respect to the public shares. If you hold your units in an account at a brokerage firm or bank, you must notify your broker or bank that you elect to separate the units into the underlying public shares and public warrants, or if you hold units registered in your own name, you must contact the transfer agent directly and instruct them to do so. If you fail to cause your public shares to be separated and delivered to the transfer agent by 10:00 AM Eastern Time, on [•], 2020 you will not be able to exercise your redemption rights with respect to your public shares.

 

Q:

What are the United States federal income tax consequences of exercising my redemption rights?

 

A:

Whether the redemption is subject to United States federal income tax depends on the particular facts and circumstances. Please see the section entitled “The Business Combination Proposal — Certain United

 

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  States Federal Income Tax Considerations.” We urge you to consult your tax advisors regarding the tax consequences of exercising your redemption rights.

 

Q:

Do I have appraisal rights in connection with the proposed Business Combination?

 

A:

No. Neither our stockholders nor our warrant holders have appraisal rights in connection with the Business Combination under the DGCL.

 

Q:

What do I need to do now?

 

A:

dMY urges you to read carefully and consider the information contained in this proxy statement, including the annexes, and to consider how the Business Combination will affect you as a stockholder and/or warrant holder of dMY. Stockholders should then vote as soon as possible in accordance with the instructions provided in this proxy statement and on the enclosed proxy card.

 

Q:

How do I vote?

 

A:

The special meeting will be held via live webcast at 10:00 AM Eastern Time, on [•], 2020, at [•]. The special meeting can be accessed by visiting [•], where you will be able to listen to the meeting live and vote during the meeting. Please note that you will only be able to access the special meeting by means of remote communication.

If you are a holder of record of shares of dMY common stock on the record date, you may vote at the special meeting or by submitting a proxy for the special meeting. You may submit your proxy by completing, signing, dating and returning the enclosed proxy card in the accompanying pre-addressed postage paid envelope. If you hold your shares in “street name,” which means your shares are held of record by a broker, bank or nominee, you should contact your broker to ensure that votes related to the shares you beneficially own are properly counted. In this regard, you must provide the broker, bank or nominee with instructions on how to vote your shares or, if you wish to attend the special meeting and vote, obtain a proxy from your broker, bank or nominee.

 

Q:

If my shares are held in “street name,” will my broker, bank or nominee automatically vote my shares for me?

 

A:

No. If your shares are held in a stock brokerage account or by a bank or other nominee, you are considered the “beneficial holder” of the shares held for you in what is known as “street name.” If this is the case, this proxy statement may have been forwarded to you by your brokerage firm, bank or other nominee, or its agent.

As the beneficial holder, you have the right to direct your broker, bank or other nominee as to how to vote your shares. If you do not provide voting instructions to your broker on a particular proposal on which your broker does not have discretionary authority to vote, your shares will not be voted on that proposal. This is called a “broker non-vote.” Broker non-votes will not be counted for the purposes of determining the existence of a quorum. Moreover, broker non-votes will have no effect on any of the proposals in this proxy statement, except that broker non-votes will have the same effect as a vote “AGAINST” the charter amendment proposal.

For the proposals in this proxy statement, your broker will not have the discretionary authority to vote your shares. Accordingly, your bank, broker, or other nominee can vote your shares at the Special Meeting only if you provide instructions on how to vote. You should instruct your broker to vote your shares as soon as possible in accordance with directions you provide.

 

Q:

When and where will the special meeting be held?

 

A:

The special meeting will be held via live webcast at 10:00 AM Eastern Time on [•], 2020, at [•], unless the special meeting is adjourned. The special meeting can be accessed by visiting [•], where you will be able to

 

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  listen to the meeting live and vote during the meeting. Please note that you will only be able to access the special meeting by means of remote communication.

 

Q:

Who is entitled to vote at the special meeting?

 

A:

dMY has fixed [•], 2020 as the record date. If you were a stockholder of dMY at the close of business on the record date, you are entitled to vote on matters that come before the special meeting. However, a stockholder may only vote his or her shares if he or she is present in person (which would include presence at the virtual special meeting) or is represented by proxy at the special meeting.

 

Q:

How many votes do I have?

 

A:

Our stockholders are entitled to one vote at the special meeting for each share of common stock held of record as of the record date. As of the close of business on the record date, there were outstanding [•] shares of dMY common stock, of which [•] were outstanding public shares.

 

Q:

What constitutes a quorum?

 

A:

A quorum of our stockholders is necessary to hold a valid meeting. The presence (which would include presence at the virtual special meeting), in person or by proxy, of stockholders holding a majority of the shares entitled to vote at the special meeting constitutes a quorum at the special meeting. In the absence of a quorum, the chairperson of the special meeting has the power to adjourn the special meeting. As of the record date for the special meeting, [•] shares of dMY common stock would be required to achieve a quorum.

 

Q:

What vote is required to approve each proposal at the special meeting?

 

A:

The following votes are required for each proposal at the special meeting:

 

   

Business combination proposals: The approval of the business combination proposal requires the affirmative vote of a majority of the votes cast by holders of Class A Common Stock and Class B Common Stock present in person or represented by proxy and entitled to vote at the special meeting, voting together as a single class.

 

   

Charter amendment proposal: The approval of the charter amendment proposal requires the affirmative vote of holders of a majority of the outstanding shares of Class A Common Stock and Class B Common Stock entitled to vote thereon at the special meeting, voting as a single class.

 

   

Advisory charter proposals: The approval of each of the advisory charter proposals, each of which is a non-binding advisory vote, requires the affirmative vote of a majority of the votes cast by holders of Class A Common Stock and Class B Common Stock present in person or represented by proxy and entitled to vote at the special meeting, voting as a single class.

 

   

NYSE proposal: The approval of the NYSE proposal requires the affirmative vote of a majority of the votes cast by holders of Class A Common Stock and Class B Common Stock present in person or represented by proxy and entitled to vote at the special meeting, voting as a single class.

 

   

Director election proposal: The election of the director nominees pursuant to the director election proposal requires a plurality of the votes cast by holders of Class A Common Stock and Class B Common Stock present in person or represented by proxy and entitled to vote at the special meeting, voting as a single class.

 

   

Incentive plan proposal: The approval of the incentive plan proposal requires the affirmative vote of a majority of the votes cast by holders of Class A Common Stock and Class B Common Stock present in person or represented by proxy and entitled to vote at the special meeting, voting as a single class.

 

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Adjournment proposal: The approval of the adjournment proposal requires the affirmative vote of a majority of the votes cast by holders of Class A Common Stock and Class B Common Stock present in person or represented by proxy and entitled to vote at the special meeting, voting as a single class.

 

Q:

What are the recommendations of the Board?

 

A:

The Board believes that the business combination proposal and the other proposals to be presented at the special meeting are in the best interest of dMY’s stockholders and unanimously recommends that our stockholders vote “FOR” the business combination proposal, “FOR” the charter amendment proposal, “FOR” each of the separate advisory charter proposals, “FOR” the NYSE proposal, “FOR” the incentive plan proposal, “FOR” each of the director nominees set forth in the director election proposal, and “FOR” the adjournment proposal, in each case, if presented to the special meeting.

The existence of financial and personal interests of dMY’s directors and officers may result in conflicts of interest, including a conflict between what may be in the best interests of the Company and its stockholders and what may be best for a director’s personal interests when determining to recommend that stockholders vote for the proposals. These conflicts of interest include, among other things, that if we do not consummate an initial business combination by February 25, 2022, we may be forced to liquidate and the 5,750,000 founder shares, 6,600,000 private placement warrants owned by our initial stockholders would be worthless. See the sections entitled “The Business Combination Proposal — Interests of Certain Persons in the Business Combination” and “Beneficial Ownership of Securities” for more information.

 

Q:

How do our Sponsor and the other initial stockholders intend to vote their shares?

 

A:

Pursuant to the terms of the letter agreement entered into at the time of the IPO, our initial stockholders agreed to vote their founder shares and any public shares purchased by them, in favor of the business combination proposal. As of the date of this proxy statement, our initial stockholders own an aggregate of 5,750,000 shares of dMY common stock, which in the aggregate represent 20% of our total outstanding shares on the date of this proxy statement.

 

Q:

May our Sponsor and the other initial stockholders purchase public shares or warrants prior to the special meeting?

 

A:

At any time prior to the special meeting, during a period when they are not then aware of any material nonpublic information regarding dMY or our securities, our initial stockholders, RSI and/or its affiliates may purchase shares and/or warrants from investors, or they may enter into transactions with such investors and others to provide them with incentives to acquire shares of dMY common stock or vote their shares in favor of the business combination proposal. The purpose of such share purchases and other transactions would be to increase the likelihood that the proposals presented to stockholders for approval at the special meeting are approved or to provide additional equity financing. Any such share purchases and other transactions may thereby increase the likelihood of obtaining stockholder approval of the Business Combination. This may result in the completion of our Business Combination that may not otherwise have been possible. While the exact nature of any such incentives has not been determined as of the date of this proxy statement, they might include, without limitation, arrangements to protect such investors or holders against potential loss in value of their shares, including the granting of put options.

Entering into any such incentive arrangements may have a depressive effect on shares of dMY common stock. For example, as a result of these arrangements, an investor or holder may have the ability to effectively purchase shares at a price lower than market and may therefore be more likely to sell the shares he owns, either prior to or immediately after the special meeting.

If such transactions are effected, the consequence could be to cause the Business Combination to be approved in circumstances where such approval could not otherwise be obtained. Purchases of shares by

 

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the persons described above would allow them to exert more influence over the approval of the proposals to be presented at the special meeting and would likely increase the chances that such proposals would be approved. As of the date of this proxy statement, there have been no such discussions and no agreements to such effect have been entered into with any such investor or holder. dMY will file a Current Report on Form 8-K to disclose any arrangements entered into or significant purchases made by any of the aforementioned persons that would affect the vote on the proposals to be voted on at the special meeting. Any such report will include descriptions of any arrangements entered into or significant purchases by any of the aforementioned persons.

 

Q:

What happens if I sell my shares of dMY common stock before the special meeting?

 

A:

The record date for the special meeting is earlier than the date of the special meeting and earlier than the date that the Business Combination is expected to be completed. If you transfer your shares of dMY common stock after the applicable record date, but before the special meeting, unless you grant a proxy to the transferee, you will retain your right to vote at the special meeting with respect to such shares, but the transferee, and not you, will have the ability to redeem such shares (if time permits).

 

Q:

How has the announcement of the Business Combination affected the trading price of the Company’s Class A Common Stock, warrants and units?

 

A:

On July 24, 2020, the last trading date before the public announcement of the Business Combination, the Company’s Class A Common Stock, warrants and units closed at $11.30, $2.01 and $12.16, respectively. On [•], 2020, the trading date immediately prior to the date of this proxy statement, the Company’s Class A Common Stock, warrants and units closed at $[•], $0.[•] and $[•], respectively.

 

Q:

May I change my vote after I have mailed my signed proxy card?

 

A:

Yes. Stockholders may send a later-dated, signed proxy card to dMY’s secretary at the address set forth below so that it is received by dMY’s secretary prior to the vote at the special meeting (which is scheduled to take place [•], 2020) or attend the special meeting in person (which would include presence at the virtual special meeting) and vote. Stockholders also may revoke their proxy by sending a notice of revocation to dMY’s Chief Executive Officer, which must be received by dMY’s Chief Executive Officer prior to the vote at the special meeting. However, if your shares are held in “street name” by your broker, bank or another nominee, you must contact your broker, bank or other nominee to change your vote.

 

Q:

What happens if I fail to take any action with respect to the special meeting?

 

A:

If you fail to take any action with respect to the special meeting and the Business Combination is approved by stockholders and consummated, you will become a stockholder and/or warrant holder of the Company. If you fail to take any action with respect to the special meeting and the Business Combination is not approved, you will remain a stockholder and/or warrant holder of dMY. However, if you fail to take any action with respect to the special meeting, you will nonetheless be able to elect to redeem your public shares in connection with the Business Combination, provided you follow the instructions in this proxy statement for redeeming your shares.

 

Q:

What should I do with my stock certificates, warrant certificates and/or unit certificates?

 

A:

Stockholders who exercise their redemption rights must deliver their stock certificates to the transfer agent (either physically or electronically) prior to 10:00 AM, Eastern Time, on [•], 2020 (two business days prior to the vote at the special meeting).

dMY warrant holders should not submit the certificates relating to their warrants. Public stockholders who do not elect to have their public shares redeemed for the pro rata share of the trust account should not submit the certificates relating to their public shares.

 

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Upon effectiveness of the Business Combination, holders of dMY units, common stock and warrants will receive units, Class A Common Stock and warrants of the Company without needing to take any action and accordingly such holders should not submit the certificates relating to their units, common stock and warrants.

In addition, before the Closing, each outstanding unit of dMY (each of which consists of one share of Class A Common Stock and one-half of one warrant to purchase one share of Class A Common Stock) will be separated into its component share of Class A Common Stock and warrant.

 

Q:

What should I do if I receive more than one set of voting materials?

 

A:

Stockholders may receive more than one set of voting materials, including multiple copies of this proxy statement and multiple proxy cards or voting instruction cards. For example, if you hold your shares in more than one brokerage account, you will receive a separate voting instruction card for each brokerage account in which you hold shares. If you are a holder of record and your shares are registered in more than one name, you will receive more than one proxy card. Please complete, sign, date and return each proxy card and voting instruction card that you receive in order to cast a vote with respect to all of your shares of dMY common stock.

 

Q:

Who can help answer my questions?

 

A:

If you have questions about the Business Combination or if you need additional copies of the proxy statement or the enclosed proxy card you should contact:

Morrow Sodali LLC

470 West Avenue, Suite 3000

Stamford CT 06902

Tel: (800) 662-5200

Banks and brokers call collect: (203) 658-9400

E-mail: DMYT.info@investor.morrowsodali.com

You also may obtain additional information about dMY from documents filed with the SEC by following the instructions in the section entitled “Where You Can Find More Information.” If you are a holder of public shares and you intend to seek redemption of your shares, you will need to deliver your public shares (either physically or electronically) to the transfer agent at the address below prior to 10:00 AM, Eastern Time, on [•], 2020 (two business days prior to the vote at the special meeting). If you have questions regarding the certification of your position or delivery of your stock, please contact:

Mark Zimkind

Continental Stock Transfer & Trust Company

One State Street Plaza, 30th Floor

New York, New York 10004

E-mail: mzimkind@continentalstock.com

 

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SUMMARY OF THE PROXY STATEMENT

This summary highlights selected information from this proxy statement and does not contain all of the information that is important to you. To better understand the proposals to be submitted for a vote at the special meeting, including the Business Combination, you should read this entire document carefully, including the Business Combination Agreement, attached as Annex A-1 and Annex A-2 to this proxy statement. The Business Combination Agreement is the legal document that governs the business combination and the other transactions that will be undertaken in connection therewith. The Business Combination Agreement is also described in detail in this proxy statement in the section entitled “The Business Combination Agreement.” This proxy statement also includes forward-looking statements that involve risks and uncertainties. See “Cautionary Statement Regarding Forward-Looking Statements.”

The Parties to the Business Combination

dMY Technology Group, Inc.

dMY is a blank check company, incorporated in Delaware, formed for the purpose of effecting a merger, share exchange, asset acquisition, stock purchase, reorganization, recapitalization or other similar business combination with one or more businesses. Based on our business activities, dMY is a “shell company” as defined under the Exchange Act because we have no operations and nominal assets consisting almost entirely of cash.

Our Class A Common Stock and warrants are currently listed on the NYSE under the symbols “DMYT” and “DMYT WS,” respectively. Certain of our shares of Class A Common Stock and warrants currently trade as units consisting of one share of Class A Common Stock and one-half of one redeemable warrant, and are listed on the NYSE under the symbol “DMYT.U” The units will automatically separate into their component securities upon consummation of the Business Combination and, as a result, will no longer trade as an independent security. Upon the Closing, we intend to change our name from “dMY Technology Group, Inc.” to “Rush Street Interactive, Inc.” We intend to apply to continue the listing of our Class A Common Stock and warrants on the NYSE under the symbols “RSI” and “RSI WS,” respectively, upon the Closing.

The mailing address of dMY’s principal executive office is 1180 North Town Center Drive, Suite 100, Las Vegas, Nevada 89144. Our telephone number is (702) 781-4313.

dMY Sponsor, LLC

dMY Sponsor, LLC is a Delaware limited liability company, headquartered in Las Vegas, Nevada, that is the sponsor of the Company.

Rush Street Interactive, LP

RSI is a Delaware limited partnership, headquartered in Chicago, Illinois, that operates online casino and sports betting sites in certain jurisdictions in the United States and in Latin America.

The mailing address of RSI’s headquarters is 900 N Michigan Avenue, Chicago, Illinois, 60611.

Rush Street Interactive GP, LLC

Rush Street Interactive GP, LLC is a Delaware limited liability company and the current general partner of RSI. Pursuant to the terms of the Business Combination Agreement and the RSA A&R LPA, Rush Street Interactive GP, LLC will be replaced as general partner of RSI by a new Delaware limited liability company and



 

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wholly-owned subsidiary of the Company, RSI GP, LLC, formed solely to serve as the new general partner of RSI. Rush Street Interactive GP, LLC is party to the Business Combination Agreement in its capacity as the representative for the Sellers.

Sellers

The Sellers are the equityholders of RSI as of immediately prior to the Closing of the transactions contemplated by the Business Combination Agreement. The Sellers include certain members of RSI’s management team and their trusts, as applicable.

Summary of the Business Combination Agreement

Following the Closing, the combined company will be organized in an umbrella partnership–C corporation (“Up-C”) structure, in which substantially all of the assets of the combined company will be held by RSI, and the Company’s only assets will be its equity interests in RSI (which will be held indirectly through the Special Limited Partner) and the RSI GP. As part of the Business Combination, (i) the Sellers will retain certain of their RSI Units and will receive an equal number of non-economic voting shares in the Company, (ii) RSI GP, a newly formed, wholly-owned subsidiary of the Company, will control RSI and (iii) the Special Limited Partner, a newly formed, wholly-owned subsidiary of the Company, will acquire newly issued RSI Units from RSI and certain outstanding RSI Units from some or all of the Sellers.

Pursuant to the Business Combination Agreement, subject to the satisfaction or waiver of the conditions set forth therein, at the Closing, (i) the Sellers will retain the Retained RSI Units; (ii) the Sellers (other than the Put-Call Sellers to the extent that the Put-Calls are in effect as of the Closing) will transfer to the Special Limited Partner the Purchased RSI Units; (iii) the Company will issue to RSI (for immediate further distribution to the Sellers) the number of shares of Class V Voting Stock equal to the number of Retained RSI Units (net of the number of Purchased RSI Units, but including the number of Put-Call Units to the extent that the Put-Calls are in effect as of the Closing), which will entitle its holder to one vote per share but not any right to dividends or distributions; (iv) the Special Limited Partner will contribute to RSI the Contribution Amount; (v) RSI GP will acquire 100% of the non-economic partnership interests of RSI; (vi) all of the Class B Common Stock will automatically be converted into shares of Class A Common Stock on a one-for-one basis; (vii) the Company, the Special Limited Partner, RSI, the Sellers and the Sellers’ Representative will enter into a customary Tax Receivable Agreement (as further described and discussed below); and (viii) if the Closing occurs on or prior to December 20, 2020, the Put-Calls will be effective and beginning on December 21, 2020 until December 28, 2020, the Put-Call Sellers will have the right to sell to RSI, and RSI will have the right to purchase from the Put-Call Sellers, the Put-Call Units, on the terms and subject to the conditions set forth in the Business Combination Agreement and the Put-Call Agreements.

Pursuant to the Business Combination Agreement, at the Closing, (i) 1,212,813 of the Issued RSI Units issued to the Special Limited Partner and 1,212,813 shares of Class A Common Stock held by the Initial Stockholders (after giving effect to the Class B Common Stock Conversion) and (ii) 15,000,000 of the Retained RSI Units held by the Sellers and 15,000,000 shares of Class V Voting Stock issued to the Sellers by the Company in connection with the Business Combination, will be subject to certain restrictions and potential forfeiture pending the achievement (if any) of certain earnout targets pursuant to the terms of the Business Combination Agreement. In addition, in connection with the Business Combination Agreement and pursuant to the Founder Holders Forfeiture Agreement (as defined and described below), up to 1,205,937 shares of Class A Common Stock held by the Initial Stockholders (after giving effect to the Class B Common Stock Conversion) will be subject to forfeiture for no consideration to the extent that the Total Measureable Cash Amount (as defined in the Founder Holders Forfeiture Agreement) does not equal at least $245,000,000 (as more fully described in the Founder Holders Forfeiture Agreement).



 

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Pursuant to the Business Combination Agreement, unless and until the Earnout Shares become earned in accordance with the Business Combination Agreement, the holders thereof will not be entitled to sell or transfer or vote any of such shares. Pursuant to the Business Combination Agreement, all or a portion of the Earnout Shares will become earned (and the foregoing restrictions will then no longer apply to such Earnout Shares) (i) upon the achievement of certain earnout targets based upon the volume weighted average share price of the Company’s Class A Common Stock equal or exceeding $12.00 or $14.00 per share, respectively, for ten (10) trading days of any twenty (20) consecutive trading day period following the Closing, in each case on or any time prior to the third anniversary of the Closing Date, (ii) if a change of control of the Company or RSI is completed on or prior to the third anniversary of the Closing, and (iii) upon the achievement of the Company of certain net revenue targets, each as more fully described in the Business Combination Agreement.

The aggregate consideration payable or issuable by the Company in exchange for the Issued RSI Units is comprised of (i) an amount in cash equal to the Contribution Amount (as defined below), and (ii) the Class V Voting Stock issued to the Sellers as described above. Pursuant to the Business Combination Agreement, “Available Closing Date Cash” will be equal to the sum of (i) the cash remaining in the Company’s trust account as of immediately prior to the Closing following any redemptions of Class A Common Stock by the Company’s current stockholders and payment of the aggregate amount of transaction expenses incurred by the parties to the Business Combination Agreement as of the Closing plus (ii) the aggregate amount of proceeds received by the Company at or prior to the Closing in connection with the PIPE (as defined below). To the extent that the Available Closing Date Cash exceeds $160,000,000, an amount of the Available Closing Date Cash (not to exceed (a) $125,000,000 in the event that the Put-Calls are not in effect as of the Closing or (b) $99,235,500 in the event that the Put-Calls are in effect as of the Closing) determined by calculating (A) the sum of (i) the Available Closing Date Cash less $160,000,000 (provided that the amount of cash attributable to this clause (i) is subject to a cap of $60,000,000) plus (ii) 50% of the amount by which the Available Closing Date Cash exceeds $220,000,000 (provided that the amount of cash attributable to this clause (ii) is subject to a cap of $65,000,000) minus (B) the Aggregate Put-Call Consideration Amount (such amount determined by subtracting the amount in clause (B) from the amount in clause (A), the “Purchased RSI Units Cash Consideration”) will be used to purchase from the Sellers (other than the Put-Call Sellers to the extent that the Put-Calls are in effect as of the Closing) the Purchased RSI Units and the remainder of the Available Closing Date Cash (which will include the Aggregate Put-Call Consideration Amount (if any)) will be contributed to RSI in exchange for the Issued RSI Units (such contributed amount, the “Contribution Amount”).

In connection with the execution of the Business Combination Agreement, (i) the Company entered into a subscription agreement with certain funds and accounts managed by Fidelity Management & Research Company LLC (the “Fidelity Subscription Agreement”) and (ii) the Company, the Sellers’ Representative and certain other subscribers entered into subscription agreements (the “Other Subscription Agreements,” together with the Fidelity Subscription Agreement, the “Subscription Agreements”), pursuant to which, such investors have agreed to purchase in connection with the closing of the Business Combination (the “Closing”) an aggregate of 16,043,002 shares of Class A Common Stock, par value $0.0001 per share, of the Company (the “Class A Common Stock”) for a purchase price of $10.00 per share, for an aggregate purchase price of $160,430,020 (together, the “PIPE”). The obligations of each party to consummate the PIPE are conditioned upon, among other things, customary closing conditions and the consummation of the transactions contemplated by the Business Combination Agreement.

Additionally, in the event the Company receives additional proceeds through Permitted Equity Financing Sources during the five business day period following the Closing Date (provided that the aggregate proceeds received in connection with the PIPE and during the five business day period following the Closing Date may not exceed $245,000,000), the Company will cause such amounts to be contributed to the Special Limited Partner, which will in turn contribute such amounts to RSI (the “Post-Closing Contribution Amount”), and in exchange, RSI will issue to the Special Limited Partner additional RSI Units, in an amount equal to the number of shares of



 

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Class A Common Stock sold by the Company to such equity financing sources, at the price at which the shares of Class A Common Stock were sold by the Company to such equity financing sources (which price may not be less than $10.00 per share). Thereafter, so long as the Sellers (other than the Put-Call Sellers to the extent that the Put-Calls are in effect as of the Closing) have not already sold to the Special Limited Partner (x) 12,500,000 RSI Units (in the event that the Put-Calls are not in effect as of the Closing or (y) 9,923,550 RSI Units (in the event that the Put-Calls are in effect as of the Closing), a portion of the Post-Closing Contribution Amount equal to the Redemption Amount (as defined below) will be used to redeem from the Sellers a number of Retained RSI Units equal to (i) the Redemption Amount divided by (ii) $10.00. In connection with such redemption, the Sellers (other than the Put-Call Sellers to the extent that the Put-Calls are in effect as of the Closing) will forfeit a corresponding number of shares of Class V Voting Stock held by the Sellers. The Purchased RSI Units Cash Consideration and the portion of the Post-Closing Contribution Amount payable to the Sellers (other than the Put-Call Sellers to the extent that the Put-Calls are in effect as of the Closing) will not in the aggregate exceed (x) $125,000,000 (in the event that the Put-Calls are not in effect as of the Closing) or (y) $99,235,500 (in the event that the Put-Calls are in effect as of the Closing). Pursuant to the Business Combination Agreement, “Redemption Amount” means the amount equal to the difference of (a) the sum of (i) the Available Closing Date Cash plus the aggregate proceeds received by the Company from any Permitted Equity Financing consummated after the Closing and on or prior to the fifth business day following the Closing Date less $160,000,000 (provided that the amount of cash attributable to this clause (i) will not be less than zero or exceed $60,000,000) plus (ii) the positive product (if any) of (A) 50% multiplied by (B) the amount by which the Available Closing Date Cash plus the aggregate proceeds received by the Company from any Permitted Equity Financing consummated after the Closing and on or prior to the fifth business day following the Closing Date exceeds $220,000,000 (provided that the amount of cash attributable to this clause (ii) will in no event be less than zero or exceed $65,000,000) minus (b) the Purchased RSI Units Cash Consideration, minus (c) the Aggregate Put-Call Consideration Amount, if any.

On or about the date on which the parties amended and restated the Business Combination Agreement, the Company and RSI entered into a Put-Call Agreement with each Put-Call Seller. Pursuant to the Put-Call Agreements and the Business Combination Agreement, if the Closing occurs on or prior to December 20, 2020, the Put-Call Agreements will remain effective and beginning on December 21, 2020 until December 28, 2020, the Put-Call Sellers will have the right to sell to RSI for $9.00 per unit, and RSI will have the right to purchase from the Put-Call Sellers for $11.00 per unit, such Put-Call Seller’s Put-Call Units for the applicable Put-Call Consideration Amount. If the Closing occurs on or prior to December 20, 2020 and the Put-Call is therefore effective, the Put-Call Sellers will retain their Put-Call Units (instead of selling such Put-Call Units to the Company at the Closing as Purchased RSI Units or transferring such Put-Call Units to RSI following the Closing as part of the post-Closing redemption) and the Aggregate Put-Call Consideration Amount will comprise a portion of the Contribution Amount and will be contributed by the Company to RSI at the Closing (for use in connection with the exercise, if any, of the Put-Calls or for any other use determined by RSI). If the Closing occurs after December 20, 2020, the Put-Call Agreements will automatically terminate and no longer be effective and the Put-Call Units held by the Put-Call Sellers may be sold to the Company at the Closing as Purchased RSI Units or redeemed by RSI following the Closing in accordance with the Business Combination Agreement as described herein.

In the event that the Put-Call is in effect, the cash proceeds that the Company (through its wholly-owned subsidiary, Special Limited Partner) would have otherwise paid directly to the Put-Call Sellers at the Closing in exchange for the Put-Call Units will instead be contributed by the Special Limited Partner directly to RSI in exchange for a number of additional Issued RSI Units equal to the number of Put-Call Units. As a result, the total number of RSI Units that will be held and controlled by the Company through its wholly-owned subsidiary, the Special Limited Partner, upon the Closing of the Business Combination will not be impacted by the Put-Call Agreements or be dependent on whether the Closing occurs prior to or after December 20, 2020. However, by virtue of RSI issuing additional Issued RSI Units to the Special Limited Partner (as compared to the Special



 

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Limited Partner purchasing the Put-Call Units from the Put-Call Sellers), the Special Limited Partner will hold a smaller percentage of the outstanding RSI Units as of the Closing if the Put-Call is in effect given that there will be a larger number of outstanding RSI Units. In those circumstances, to the extent that the Put-Call is not ultimately exercised by RSI or the Put-Call Sellers in accordance with the terms of the Put-Call Agreements, the Put-Call Sellers will continue to hold the Put-Call Units and the Special Limited Partner would continue to own a smaller percentage of the RSI Units (as compared to if the Put-Call was never in effect), though RSI would continue to hold the cash proceeds contributed by the Special Limited Partner that would have otherwise been used to redeem the Put-Call Units.

Assuming that (i) none of the Company’s current stockholders exercise their right to redeem their Class A Common Stock, (ii) the aggregate proceeds received by the Company in connection with the PIPE is $160,430,020, (iii) the Put-Calls are in effect as of the Closing and are validly exercised shortly following the Closing or not in effect, (iv) the Sellers (other than the Put-Call Sellers) transfer to the Special Limited Partner the maximum number of Purchased RSI Units (i.e. 9,923,550 if the Put-Calls are in effect or 12,500,000 if the Put-Calls are not in effect) at the Closing pursuant to the Business Combination Agreement, (v) none of the 1,205,937 Founder Holders Forfeiture Shares are forfeited as the Available Closing Date Cash exceeds $245,000,000, (vi) the Earnout Shares are excluded unless and until such shares become earned in accordance with the Business Combination Agreement, (vii) there is no exercise at the Closing of the Sponsor’s 6,600,000 private placement warrants at an exercise price of $11.50 per share (which warrants are not exercisable until the later of 12 months from the closing of the IPO and 30 days after the completion of the Business Combination), (viii) none of the parties set forth above purchase shares of Class A Common Stock in the open market, (ix) there are no other issuances of equity interests of the Company prior to or in connection with the Closing and (x) there are no issuances of any shares of the Company’s Class A Common Stock there are no issuances of any shares of the Company’s Class A Common Stock within the five business days following the Closing to additional private placement investors or following the Closing under the Plan, (x) the Company is expected to own, indirectly through the Special Limited Partner, approximately 23.11% of the RSI Units at the Closing and will control RSI through RSI GP, and (y) the Sellers will own approximately 76.89% of the RSI Units at the Closing and will control the Company through the ownership of the Class V Voting Stock. Under certain circumstances in which the minimum threshold of $160,000,000 of Available Closing Date Cash is achieved, depending on redemptions by the Company’s current stockholders, the Company may indirectly own approximately 12.41% of the RSI Units at the Closing.

Pursuant to the Business Combination Agreement, the RSI Enterprise Value is subject to adjustment following the Closing in the event that the transaction expenses attributable to RSI and the Sellers, on the one hand, or the Company and the Sponsor, on the other hand, exceed such party’s transaction expense cap (such adjustments more fully described in the Business Combination Agreement). To the extent that the RSI Enterprise Value is adjusted upwards, the Sellers will be issued an aggregate number of additional RSI Units and shares of Class V Voting Stock equal to the amount of the adjustment divided by $10.00. To the extent that the RSI Enterprise Value is adjusted downwards, the Sellers will forfeit for no consideration an aggregate number of RSI Units and shares of Class V Voting Stock equal to the amount of the adjustment divided by $10.00.

Beginning on the six month anniversary of the Closing, each Retained RSI Unit held by the Sellers may be exchanged, subject to certain conditions, for either one share of Class A Common Stock or, at the election of RSI GP in its capacity as the general partner of RSI depending on, among other things, the availability of cash at RSI after first considering the cash necessary at RSI to fund RSI’s outstanding and anticipated operating expenses, debt service costs and declared dividends (in each case, if any) license fees and expenses, tax obligations and capital for existing and continued growth in new jurisdictions, the cash equivalent of the market value of one share of Class A Common Stock, pursuant to the terms and conditions of the RSI A&R LPA (such exchange rights, as further described in the RSI A&R LPA, the “Exchange Rights”). For each Retained RSI Unit so exchanged, one share of the Class V Voting Stock will be canceled by the Company.



 

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The Business Combination Agreement provides that the Sellers’ obligation to consummate the Business Combination is conditioned on, among other things, that (i) the Company has Available Closing Date Cash of at least $160,000,000 minus the amount by which the transaction expenses incurred by RSI and the Sellers exceeds $12,500,000 and (ii) all approvals, determinations, grants, confirmations and other conditions with respect to gaming regulatory authorities in connection with the transactions contemplated by the Business Combination Agreement and the related agreements have been made, obtained, satisfied or given and in full force and effect. The Business Combination is also subject to the satisfaction or waiver of certain other closing conditions (including, without limitation, certain conditions precedent to the Company’s obligation to consummate the Business Combination) as described in the accompanying proxy statement. If these conditions are not met, and such conditions are not waived by the Sellers’ Representative or the Company, as applicable, then the Business Combination Agreement could terminate and the proposed Business Combination may not be consummated. There can be no assurance that the parties to the Business Combination Agreement would waive any such provision of the Business Combination Agreement. Furthermore, in no event will we redeem our public shares in an amount that would cause our net tangible assets to be less than $5,000,001.

From and after the Closing, Neil G. Bluhm and Gregory A. Carlin and their respective trusts (collectively, the “Controlling Holders”) will own a majority of the Company’s outstanding common stock and, therefore, will control a majority of the voting power of the Company’s outstanding common stock. Furthermore, the Controlling Holders intend to enter into a voting agreement prior to the consummation of the Business Combination whereby they agree to vote together on certain matters presented to the Company’s stockholders for so long as the voting agreement is in effect. As a result, the Company will be a “controlled company” within the meaning of the corporate governance standards of the New York Stock Exchange, which status permits the Company to elect not to comply with certain corporate governance requirements as further described herein.

Upon consummation of the Transactions contemplated by the Business Combination Agreement, the Company will change its name to “Rush Street Interactive, Inc.”

For additional information about the Business Combination Agreement and the Business Combination and other transactions contemplated thereby, see “The Business Combination Proposal — The Business Combination Agreement.”

Related Agreements

Tax Receivable Agreement

Simultaneously with the Closing, the Company, the Special Limited Partner, RSI, the Sellers and the Sellers’ Representative will enter into a tax receivable agreement (the “Tax Receivable Agreement”), which will provide for, among other things, payment by the Special Limited Partner to the Sellers 85% of the net income tax savings realized by the Company and its consolidated subsidiaries (including the Special Limited Partner) as a result of the increases in tax basis and certain other tax benefits related to the transactions contemplated under the Business Combination Agreement and the exchange of Retained RSI Units for Class A Common Stock (or cash) pursuant to the RSI A&R LPA and tax benefits related to entering into the Tax Receivable Agreement, including tax benefits attributable to payments under the Tax Receivable Agreement (as more fully described in the Tax Receivable Agreement). The Tax Receivable Agreement will remain in effect until all such tax benefits have been utilized or expired unless the Special Limited Partner exercises its rights to terminate the Tax Receivable Agreement for an amount representing the present value of anticipated future tax benefits under the Tax Receivable Agreement or certain other acceleration events occur. The Company may recognize a liability under the Tax Receivable Agreement of up to $495 million if all member interests are exchanged and assuming (i) the generation of sufficient future taxable income, (ii) a price of $10 per share, (iii) a constant corporate tax rate of 29.94% and (iv) no material changes in tax law. The amount payable under the Tax Receivable Agreement would



 

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vary from year to year, but the Company estimates that payments would be made over the next fifteen years assuming the generation of sufficient future taxable income. We expect the cash tax savings we would realize from the utilization of deferred tax assets to fund the required payments.

Proposed Charter and Amended and Restated Bylaws of the Company

Prior to the Closing on or prior to the Closing Date, the Company will amend and restate (i) subject to receipt of stockholder approval, the Charter by adopting the Proposed Charter and (ii) the current bylaws of the Company by adopting the Amended and Restated Bylaws of Company (the “A&R Bylaws”), to establish a structure containing Class A Common Stock, which will carry such economic and voting rights as set forth in the Proposed Charter and A&R Bylaws, and Class V Voting Stock, which will carry only such voting rights as set forth in the Proposed Charter and A&R Bylaws (as more fully described herein).

The Proposed Charter will require that any equity interests owned or controlled by an Unsuitable Person (as defined in the Proposed Charter) or an affiliate thereof be subject to mandatory sale and transfer, subject to the terms and conditions set forth therein, in such number and class(es)/series of equity interests as determined by the Board in good faith (following consultation with reputable outside and independent gaming regulatory counsel) pursuant to a resolution adopted by a majority of the directors of the Board.

RSI A&R LPA

At the Closing, the Company, the Special Limited Partner, RSI GP, RSI and the Sellers will enter into the RSI A&R LPA which will, among other things, permit the issuance and ownership of RSI Units as contemplated to be issued and owned upon the consummation of the Business Combination, admit RSI GP as the general partner of RSI, provide for the Exchange Rights, otherwise amend and restate the rights and preferences of the RSI Units and set forth the rights and preferences of the RSI Units, and establish the ownership of the RSI Units by the persons or entities indicated in the RSI A&R LPA.

Tax Distributions

The RSI A&R LPA will provide quarterly tax distributions payable in accordance with the RSI A&R LPA to the holders of RSI Units on a pro rata basis based upon an agreed-upon formula related to the taxable income of RSI allocable to holders of RSI Units. Generally, these tax distributions will be computed based on RSI’s estimate of the taxable income of RSI allocable to each holder of RSI Units (based on certain assumptions) multiplied by an assumed tax rate equal to the highest effective marginal combined United States federal, state and local income tax rate prescribed for an individual or corporation resident in New York, California or Illinois (whichever results in the application of the highest state and local tax rate), subject to various adjustments. Distributions, including tax distributions, will be made to holders of RSI Units on a pro rata basis.

Exchange of RSI Units for Class A Common Stock

The Sellers will, from and after the six-month anniversary of the Closing up to four times per calendar year be able to exchange all or any portion of their RSI Units, together with the cancelation of an equal number of shares of Class V Voting Stock, for a number of shares of Class A Common Stock equal to the number of exchanged RSI Units by delivering a written notice to RSI, with a copy to Special Limited Partner; provided that no holder of RSI Units may exchange less than 1,000 RSI Units in any single exchange unless exchanging all of the RSI Units held by such holder at such time, subject in each case to the limitations and requirements set forth in the RSI A&R LPA regarding such exchanges. Notwithstanding the foregoing, Special Limited Partner may, at its sole discretion, in lieu of delivering shares of Class A Common Stock for any RSI Units surrendered for exchange, pay an amount in cash per RSI Unit equal to the 5-day VWAP of the Class A Common Stock on the date of the receipt of the written notice of the exchange.



 

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Exchange Ratio

For each RSI Unit exchanged, one share of Class V Voting Stock will be canceled and one share of Class A Common Stock will be issued to the exchanging member. If the Class A Common Stock is converted or changed into another security, securities or other property, on any subsequent exchange an exchanging RSI Unit holder will be entitled to receive such security, securities or other property.

Restrictions on Exchange

In certain circumstances, the GP Company may limit the rights of holders of RSI Units to exchange their RSI Units under the RSI A&R LPA if the GP Company determines in good faith that such restrictions are necessary to avoid a material risk that RSI will be classified as a “publicly traded partnership” under applicable tax laws and regulations or result in RSI having more than 100 partners under applicable tax laws.

Limited Liability Company Agreement of RSI GP

At the Closing, the Company and RSI GP will enter into the Limited Liability Company Agreement of RSI GP (the “GP LLCA”), pursuant to which, among other things, the parties will establish a board of managers of RSI GP, which will initially be comprised of Neil Bluhm, Gregory Carlin and Richard Schwartz, to direct and exercise control over all activities of RSI GP, including RSI GP’s right to manage and control RSI. Pursuant to the GP LLCA, each of Neil Bluhm (or one of his adult children) and Gregory Carlin will be entitled to serve as a manager of the board of RSI GP until they (or their permitted transferees, successors or assigns), taken together, hold fewer equity interests of the Company and RSI (taken together) than any other shareholder or affiliated group of shareholders. In addition, RSI will have sole discretion to appoint managers (including to fill vacancies) and remove managers, subject to receipt of requisite gaming licenses and/or approvals from gaming authorities.

Amended and Restated Certificate of Incorporation and Bylaws of the Special Limited Partner

At the Closing, the Company and the Special Limited Partner will amend the Special Limited Partner’s Certificate of Incorporation and Bylaws to, among other things, provide that (i) the board of directors of the Special Limited Partner will be appointed by the board of directors of the Company and (ii) the Special Limited Partner will comply with applicable gaming laws.

Founder Holders Forfeiture Agreement

At the Closing, the Founder Holders, the Company and the Sellers’ Representative will enter into the Founder Holders Forfeiture Agreement (the “Founder Holders Forfeiture Agreement”), pursuant to which, among other things, the Founder Holders will agree to forfeit (pro rata) for no consideration up to 1,205,937 shares of Class A Common Stock in the aggregate (consisting of two hundred fifty-four thousand three hundred sixty-one (254,361) Initial Stockholders Earnout Shares (as defined in the Business Combination Agreement) and nine hundred fifty-one thousand five hundred seventy-six (951,576) shares of Class A Common Stock that are not Initial Stockholders Earnout Shares) following the Closing and the Company will agree to forfeit a corresponding number of RSI Units held by the Company to the extent that the Total Measureable Cash Amount (as defined in the Founder Holders Forfeiture Agreement) does not equal at least $245,000,000 (as more fully described in the Founder Holders Forfeiture Agreement).

Amended Insider Letter

In connection with the execution of the Business Combination Agreement, certain current officers and directors of the Company (including the Founder Holders), the Sponsor, the Company, RSI and the Sellers’



 

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Representative have entered into an amendment (the “Amended Insider Letter”) to a letter agreement entered into on February 20, 2020 in connection with the Company’s initial public offering (the “Letter Agreement”), pursuant to which, among other things, (x) the Founder Holders agreed to waive any and all anti-dilution rights described in its current Certificate of Incorporation or otherwise with respect to the shares of Class A Common Stock (that formerly constituted shares of Class B Common Stock held by the Founder Holders) held by the Founder Holders that may be implicated by the Business Combination such that the Class B Common Stock Conversion will occur as discussed herein and (y) the Founder Holders appointed the Sponsor as their representative for purposes of the earnout provisions of the Business Combination Agreement and the transactions contemplated thereby (in each case as more fully described in the Amended Insider Letter). Upon execution of the Investor Rights Agreement, the Amended Insider Letter shall be deemed amended to remove the 12-month lock-up period contained therein applicable to the Sponsor, Niccolo de Masi, Harry You and the independent directors and imposes the lock-up period applicable to the Founder Holders as described in the Investor Rights Agreement description below.

Investor Rights Agreement

At the Closing, the Company, Sellers, the Founder Holders, and the Sellers’ Representative will enter into an Investor Rights Agreement (the “Investor Rights Agreement”), pursuant to which, among other things, (i) the Company and the Founder Holders will agree to terminate the Registration Rights Agreement, dated as of February 20, 2020, entered into by them in connection with the Company’s initial public offering, (ii) the Sponsor will have the right to nominate two directors to the Board and the Sellers’ Representative will have the right to nominate the remaining directors of the Board (initially seven directors), and the Sellers’ Representative will have the right to appoint up to three non-voting board observers to the Board, in each case subject to certain conditions, (iii) the Company will provide the Sellers and the Sponsor certain registration rights with respect to the shares of Class A Common Stock held by the Sellers and the Sponsor, (iv) the Founder Holders and the Sellers will agree not to transfer, sell, assign or otherwise dispose of the shares of Class A Common Stock and the RSI Units held by such person for up to 12 months following the Closing (with respect to the Founder Holders) and 180 days following the Closing (with respect to the Sellers), in each case, subject to certain exceptions, including an exception for the sale of the Put-Call Units to RSI pursuant to and in accordance with the Business Combination Agreement and the Put-Call Agreements, as applicable, and (v) the Amended Insider Letter shall be deemed amended to remove the 12-month lock-up period contained therein applicable to the Sponsor, Niccolo de Masi, Harry You and the independent directors, in each case as more fully described in the Investor Rights Agreement attached as Exhibit F to the Business Combination Agreement.

Services Agreement

At the Closing, RSI and Rush Street Gaming, LLC, a current affiliate of RSI (“RSG”), will enter into a Services Agreement (the “Services Agreement”), pursuant to which, among other things, RSG will provide certain specified services to RSI for a period of two years following the Closing Date, subject to extension and early termination, including, without limitation, services relating to legal and compliance, human resources and information technology (in each case as more fully described in the Services Agreement). As compensation for RSG’s provision of these services, during the term of the Services Agreement, RSI will reimburse RSG for (i) all third party costs, including fees and costs incurred in connection with any required consents, incurred in connection with the provision of services, (ii) its reasonable and documented out-of-pocket travel and related expenses as approved by RSI, and (iii) an allocable portion of payroll, benefits and overhead (calculated at 150% of an employee’s salary, bonus and benefits cost) with respect to RSG’s or its affiliates’ employees who perform or otherwise assist in providing the services.



 

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Employment Agreement

At the Closing, RSI will enter into an employment agreement with Gregory A. Carlin on terms reasonably mutually acceptable to RSI and Mr. Carlin. Following the Closing, Mr. Carlin will remain Chief Executive Officer of RSG and pursuant to the Employment Agreement, Mr. Carlin will not be required to devote his full business time and attention to RSI.

Subscription Agreements

In connection with the execution of the Business Combination Agreement, (i) the Company entered into a subscription agreement with certain funds and accounts managed by Fidelity Management & Research Company LLC (the “Fidelity Subscription Agreement”) and (ii) the Company, the Sellers’ Representative and certain other subscribers entered into subscription agreements (the “Other Subscription Agreements,” together with the Fidelity Subscription Agreement, the “Subscription Agreements”), pursuant to which, such investors have agreed to purchase in connection with Closing an aggregate of 16,043,002 shares of Class A Common Stock for a purchase price of $10.00 per share, for an aggregate purchase price of $160,430,020 (together, the “PIPE”). The obligations of each party to consummate the PIPE are conditioned upon, among other things, customary closing conditions and the consummation of the transactions contemplated by the Business Combination Agreement.

Recapitalization Agreement

In connection with the execution of the Business Combination Agreement, the Sellers, the Sellers’ Representative and RSI entered into a recapitalization agreement (the “Recapitalization Agreement”), pursuant to which the parties agreed to recapitalize the equity interests of RSI effective as of immediately prior to the Closing into a single class of common units in order to permit the issuance and ownership of the RSI Units as contemplated to be issued and owned upon the consummation of the Business Combination.

Put-Call Agreements

On or about the date on which the parties amended and restated the Business Combination Agreement, the Company, RSI and each of the Put-Call Sellers entered into Put-Call Agreements. Pursuant to the Put-Call Agreements and the Business Combination Agreement, if the Closing occurs on or prior to December 20, 2020, the Put-Call Agreements will remain effective and beginning on December 21, 2020 until December 28, 2020, the Put-Call Sellers will have the right to sell to RSI for $9.00 per unit, and RSI will have the right to purchase from the Put-Call Sellers for $11.00 per unit, the Put-Call Sellers’ Put-Call Units (not to exceed 2,576,450 in the aggregate). If the Closing occurs after December 20, 2020, the Put-Call Agreements will automatically terminate and no longer be effective and the Put-Call Units held by the Put-Call Sellers may be sold to the Company at the Closing as Purchased RSI Units or redeemed by RSI following the Closing in accordance with the Business Combination Agreement as described herein.

Equity Ownership Upon Closing

As of the date of this proxy statement, there are 28,750,000 shares of dMY common stock outstanding, comprised of 23,000,000 shares of Class A Common Stock held by public stockholders and 5,750,000 shares of Class B Common Stock held by the Initial Stockholders (5,675,000 shares held by the Sponsor, and 25,000 held by each of our three independent directors, Darla Anderson, Francesca Luthi and Charles E. Wert). In connection with the Closing, (i) each then-issued and outstanding share of Class B Common Stock will automatically convert into a share of Class A Common Stock on a one-for-one basis and an aggregate number of 5,750,000 shares in accordance with the terms of the Charter and Amended Insider Letter and (ii) the PIPE Investors will acquire 16,043,002 shares of Class A Common Stock.



 

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We anticipate that, upon completion of the Business Combination, the voting interests in the Company will be as set forth in the table below.*

 

     Assuming No
Redemptions of
Public Shares(1)
    Assuming
Maximum
Redemptions of
Public Shares(2)
 

dMY’s Public Stockholders

     12.20     1.64

Initial Stockholders

     2.41     1.85

PIPE Investors

     8.51     8.92

Sellers

     76.89     87.58

 

(1)

Assumes that (i) none of the holders of public shares of Class A Common Stock exercise their redemption rights, (ii) the parties to the Business Combination Agreement incur $30 million of transaction expenses, (iii) the Put-Calls are in effect as of the Closing and are validly exercised shortly following the Closing or are not in effect, (iv) the maximum amount of Purchased RSI Units are purchased from the Sellers (other than the Put-Call Sellers) (i.e., $99,235,500 if the Put-Calls are in effect or $125,000,000 if the Put-Calls are not in effect) at Closing, (v) none of the 1,205,937 Founder Holders Forfeiture Shares are forfeited because the Available Closing Date Cash exceeds $245,000,000, (vi) the Earnout Shares are excluded unless and until such shares become earned in accordance with the Business Combination Agreement, (vii) there is no exercise at the Closing of the Sponsor’s 6,600,000 private placement warrants at an exercise price of $11.50 per share (which warrants are not exercisable until the later of 12 months from the closing of the IPO and 30 days after the completion of the Business Combination), (viii) none of the parties set forth above purchase shares of Class A Common Stock in the open market, (ix) there are no other issuances of equity interests of the Company prior to or in connection with the Closing and (x) there are no issuances of any shares of the Company’s Class A Common Stock within the five business days following the Closing to additional private placement investors or following the Closing under the Plan.

(2)

Assumes that (i) the holders of 20,043,002 shares of Class A Common Stock exercise their redemption rights (representing the maximum amount of public shares that can be redeemed to satisfy the Minimum Cash Condition, (ii) the parties to the Business Combination Agreement incur $30 million of transaction expenses, (iii) the Put-Calls are in effect as of the Closing but there are no Put-Call Units due to insufficient excess cash or are not in effect, (iv) no Purchased RSI Units are purchased from the Sellers due to insufficient excess cash, (v) per the Business Combination Agreement, the Initial Stockholders forfeit (on a pro rata basis) 1,205,937 Founder Holders Forfeiture Shares in the aggregate because the Available Closing Date Cash does not exceed $160,000,000, (vi) the Sellers’, Company’s and Initial Stockholders’ Earnout Shares are excluded, (vii) no exercise of the Sponsor’s 6,600,000 private placement warrants at an exercise price of $11.50 per share (which warrants are not exercisable until the later of 12 months from the closing of the IPO and 30 days after the completion of the Business Combination), (viii) none of the parties set forth above purchase shares of Class A Common Stock in the open market, (ix) there are no other issuances of equity interests of the Company prior to or in connection with the Closing and (x) there are no issuances of any shares of the Company’s Class A Common Stock within the five business days following the Closing to additional private placement investors or following the Closing under the Plan.

*

Upon completion of the Business Combination, the Company’s public stockholders, the Initial Stockholders and the PIPE Investors will hold shares of Class A Common Stock and the Sellers will hold shares of Class V Voting Stock.

The voting percentages set forth above were calculated based on the amounts set forth in the sources and uses table on pages 51 and 156 of this proxy statement and do not take into account (i) warrants that will remain outstanding immediately following the Business Combination and may be exercised thereafter (commencing on the later of 12 months from the closing of the IPO and 30 days following the Closing for one share of Class A Common Stock for one share of Class A Common Stock, (ii) Earnout Shares that may become earned in



 

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accordance with the terms and conditions of the Business Combination Agreement, in which event, such shares will be entitled to one vote per share, (iii) the 1,205,937 Founder Holders Forfeiture Shares which are not entitled to vote unless and until it is determined that such shares will not be forfeited by the Initial Stockholders in accordance with the terms of the Founder Holders Forfeiture Agreement, or (iv) the issuance of any shares upon completion of the Business Combination under the Plan, a copy of which is attached to this proxy statement as Annex C, but does include the shares owned by our Initial Stockholders, which, on the effective date of the Business Combination, will convert into 5,750,000 shares of Class A Common Stock in accordance with the terms of the Charter, subject to adjustment. For more information, please see the section entitled “Unaudited Pro Forma Condensed Combined Financial Information.

If the actual facts are different than the assumptions set forth above, the voting percentages set forth above will be different. For example, there are currently outstanding an aggregate of 18,100,000 warrants to acquire our shares of Class A Common Stock, which are comprised of 6,600,000 private placement warrants held by our initial stockholders and 11,500,000 warrants sold as part of the units in the Company’s IPO (the “public warrants”). Each of our outstanding warrants is exercisable commencing on the later of 12 months from the closing of the IPO and 30 days following the Closing for one share of Class A Common Stock for one share of Class A Common Stock. If we assume that each outstanding warrant is exercised and one share of Class A Common Stock is issued as a result of such exercise, with payment to dMY of the exercise price of $11.50 per warrant for one share, our fully-diluted share capital would increase by a total of 18,100,000 shares, with approximately $208,150,000 paid to dMY to exercise the warrants. In addition, at the Closing there will be 1,212,813 Class A Common Stock held by the Initial Stockholders (after giving effect to the Class B Common Stock Conversion) and 15,000,000 shares of Class V Voting Stock held by the Sellers that are subject to earnout criteria in accordance with the Business Combination Agreement. If we assume that the earnout criteria are met, the holders of such Earnout Shares will become entitled to vote such shares and our fully-diluted voting stock would increase by a total of 16,212,813 shares. Furthermore, up to 1,205,937 shares of Class A Common Stock held by the Initial Stockholders (after giving effect to the Class B Common Stock Conversion) are subject to forfeiture and cancellation for no consideration if the Total Measureable Cash Amount (as defined in the Founder Holders Forfeiture Agreement) does not equal at least $245,000,000 (as more fully described in the Founder Holders Forfeiture Agreement). If we assume that the Total Measureable Cash Amount equals $245,000,000, the Initial Stockholders will become entitled to vote such shares and our fully-diluted voting stock would increase by a total of 1,205,937 shares. Furthermore, there may be up to 2,576,450 Put-Call Units outstanding at the Closing depending on the amount of Available Closing Date Cash. If we assume that the Put-Call Units are not exercised after Closing in accordance with the terms and conditions of the Business Combination Agreement and the Put-Call Agreements, our fully-diluted share capital would be increased by up to 2,576,450 shares of Class V Voting Stock held by the Put-Call Sellers.

Subject to certain limited exceptions, the shares of Class A Common Stock held by the Initial Stockholders as of the Closing will not be transferred, assigned or sold until the date that is one year after the date of the Closing, unless the Earnout Shares held by the Initial Stockholders become earned in accordance with the Business Combination Agreement prior to the one year anniversary of the Closing Date, in which case, the Class A Common Stock held by the Initial Stockholders as of the Closing will not be transferred, assigned or sold until the date that is the later of (i) the date on which the Earnout Shares become earned and (ii) 180 days after the Closing Date.

Organizational Structure

The following diagrams illustrate (i) the ownership structure of the Company prior to the Closing, (ii) the ownership structure of RSI prior to the Closing and (iii) the ownership structure of the Company immediately following the Closing. We calculated the equity interests shown in the last diagram based on the amounts set forth in the sources and uses table on pages 51 and 156 of this proxy statement and they represent the scenarios where there is no redemption of our public shares and the maximum redemption of our public shares, respectively.



 

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The no redemption scenario assumes that (i) none of the holders of public shares of Class A Common Stock exercise their redemption rights, (ii) the parties to the Business Combination Agreement incur $30 million of transaction expenses, (iii) the Put-Calls are in effect as of the Closing and are validly exercised shortly following the Closing or are not in effect, (iv) the maximum amount of Purchased RSI Units are purchased from the Sellers (other than the Put-Call Sellers) (i.e., $99,235,500 if the Put-Calls are in effect or $125,000,000 if the Put-Calls are not in effect) at Closing, (v) none of the 1,205,937 Founder Holders Forfeiture Shares are forfeited because the Available Closing Date Cash exceeds $245,000,000, (vi) the Earnout Shares are excluded unless and until such shares become earned in accordance with the Business Combination Agreement, (vii) there is no exercise at the Closing of the Sponsor’s 6,600,000 private placement warrants at an exercise price of $11.50 per share (which warrants are not exercisable until the later of 12 months from the closing of the IPO and 30 days after the completion of the Business Combination), (viii) none of the parties set forth above purchase shares of Class A Common Stock in the open market, (ix) there are no other issuances of equity interests of the Company prior to or in connection with the Closing and (x) there are no issuances of any shares of the Company’s Class A Common Stock within the five business days following the Closing to additional private placement investors or following the Closing under the Plan.

The maximum redemption scenario assumes that that (i) the holders of 20,043,002 shares of Class A Common Stock exercise their redemption rights (representing the maximum amount of public shares that can be redeemed to satisfy the Minimum Cash Condition), (ii) the parties to the Business Combination Agreement incur $30 million of transaction expenses, (iii) the Put-Calls are in effect as of the Closing but there are no Put-Call Units due to insufficient excess cash, (iv) no Purchased RSI Units are purchased from the Sellers due to insufficient excess cash or are not in effect, (v) per the Business Combination Agreement, the Initial Stockholders forfeit (on a pro rata basis) 1,205,937 Founder Holders Forfeiture Shares in the aggregate because the Available Closing Date Cash does not exceed $160,000,000, (vi) the Sellers’, Company’s and Initial Stockholders’ Earnout Shares are excluded, (vii) no exercise of the Sponsor’s 6,600,000 private placement warrants at an exercise price of $11.50 per share (which warrants are not exercisable until the later of 12 months from the closing of the IPO and 30 days after the completion of the Business Combination), (viii) none of the parties set forth above purchase shares of Class A Common Stock in the open market, (ix) there are no other issuances of equity interests of the Company prior to or in connection with the Closing and (x) there are no issuances of any shares of the Company’s Class A Common Stock within the five business days following the Closing to additional private placement investors or following the Closing under the Plan.

The ownership and voting power percentages set forth in the diagrams below do not take into account the issuance of any shares of the Company’s Class A Common Stock to the Sellers upon exchange of Retained RSI Units (and the surrender of a corresponding number of shares of Class V Voting Stock). If the actual facts are different than the assumptions set forth above, the percentage ownership numbers set forth below will be different.



 

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Before the Business Combination

 

LOGO



 

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After the Business Combination

LOGO

Proposals to be put to the Special meeting

The following is a summary of the proposals to be put to the special meeting.



 

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The Business Combination Proposal

The Business Combination Agreement provides that, among other things (i) the Sellers will retain the number of RSI Units as described herein; (ii) the Sellers (other than the Put-Call Sellers to the extent that the Put-Calls are in effect as of the Closing) will transfer to the Special Limited Partner, a wholly-owned subsidiary of the Company, a number of RSI Units (not to exceed (a) 12,500,000 RSI Units in the event that the Put-Calls are not in effect as of the Closing or (b) 9,923,550 RSI Units in the event that the Put-Calls are in effect as of the Closing) as described herein; (iii) the Company will issue to RSI (for immediate further distribution to the Sellers) a number of Class V Voting Stock equal to the number of RSI Units retained by the Sellers, which will entitle its holder to one vote per share but not any right to dividends or distributions; (iv) a wholly-owned subsidiary of the Company will contribute cash to RSI in exchange for RSI Units as described herein; (v) RSI GP, a wholly-owned subsidiary of the Company, will acquire 100% of the non-economic partnership interests of RSI, in each case, on the terms and subject to the conditions set forth in the Business Combination Agreement; and (vi) if the Closing occurs on or prior to December 20, 2020, the Put-Calls will be effective and beginning on December 21, 2020 until December 28, 2020, the Put-Call Sellers will have the right to sell to RSI, and RSI will have the right to purchase from the Put-Call Sellers, the Put-Call Units, on the terms and subject to the conditions set forth in the Business Combination Agreement and the Put-Call Agreements.

Following the Closing, the combined company will be organized in an “Up-C” structure in which substantially all of the assets and the business of the combined company will be held by RSI and its subsidiaries, and the Company’s only direct assets (through the Special Limited Partner) will consist of RSI Units and all of the limited liability company units of RSI GP. The Company (through the Special Limited Partner) is expected to own between approximately 12.41% and 23.11% of the RSI Units.

After consideration of the factors identified and discussed in the section entitled “The Business Combination Proposal — Interests of Certain Persons in the Business Combination,” the Board concluded that the Business Combination met all of the requirements disclosed in the prospectus for our IPO, including that the business of dMY had a fair market value of at least 80% of the balance of the funds in the trust account at the time of execution of the Business Combination Agreement.

If any proposal is not approved by dMY’s stockholders at the special meeting, the Board may submit the adjournment proposal for a vote.

For additional information, see “The Business Combination Proposal” section of this proxy statement.

The Charter Amendment Proposal

If the business combination proposal is approved and the Business Combination is to be consummated, prior to the Closing on or prior to the Closing Date, the Company will amend and restate the Charter with the Proposed Charter under the DGCL to:

 

  (i)

to change the total number of shares and classes of stock that the Company is authorized to issue up to 951,000,000 shares, consisting of (i) 1,000,000 shares of preferred stock, par value $0.0001 per share, (ii) 750,000,000 shares of Class A Common Stock, and (iii) 200,000,000 shares of Class V Voting Stock (we refer to this as “advisory charter proposal A”);

 

  (ii)

to change the stockholder vote required for approval to the affirmative vote of the holders of at least 6623% of the total voting power of all the then outstanding shares of stock of the Company entitled to vote generally in the election of directors, voting together as a single class to make any amendment to Article V (Bylaws), Article VI (Board of Directors), Article VII (Consent of the Stockholders in Lieu of Meeting),



 

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  Article VIII (Limited Liability; Indemnification), Article IX (DGCL Section 203), Article XII (Forum), and Article XIII (Amendments) of the Proposed Charter, and change the stockholder vote required to amend Article X (Competition and Corporate Opportunities) to 80% of the total voting power of all the then outstanding shares of stock of the Company entitled to vote generally in the election of directors, voting together as a single class (we refer to this as “advisory charter proposal B”);

 

  (iii)

to absolve any Seller, the Sponsor, members of the board of directors who are not employees of the Company (“Non-Employee Directors”) or any of their Affiliates or Affiliated Entities (each as defined in the Proposed Charter) (collectively, the “Identified Persons”) from the duty to refrain from directly or indirectly (1) engaging in and possessing interests in other business ventures of every type and description, including those engaged in the same or similar business activities or lines of business in which the Company or any of its subsidiaries now engages or proposes to engage or (2) competing with the Company or any of its subsidiaries, on its own account, or in partnership with, or as an employee, officer, director or shareholder of any other person, and, provide that no Identified Person shall be liable to the Company or its stockholders or to any affiliate of the Company for breach of any fiduciary duty solely by reason of the fact that such Identified Person engages in any such activities, and to provide that the Company renounces any such business opportunity which may be a corporate opportunity for an Identified Person other than any corporate opportunity offered to any Non-Employee Director if such opportunity is expressly offered to such person solely and expressly in his or her capacity as a director or officer of the Company, such opportunity is one the Company is legally permitted to undertake and would otherwise be reasonable for the Company to pursue (we refer to this as “advisory charter proposal C”);

 

  (iv)

to require any equity interests owned or controlled by an Unsuitable Person (each as defined in the Proposed Charter) or an affiliate thereof shall be subject to mandatory sale and transfer, subject to the terms and conditions set forth therein, in such number and class(es)/series of equity interests as determined by the board of directors in good faith (following consultation with reputable outside and independent gaming regulatory counsel) pursuant to a resolution adopted by a majority of the directors of the board (we refer to this as “advisory charter proposal D”);

 

  (v)

to elect not to be governed by Section 203 of the DGCL (we refer to this as “advisory charter proposal E”);

 

  (vi)

to require that the proposed bylaws of the Company may be amended, altered, changed, added to or repealed by (x) the board of directors or (y) (i) the affirmative vote of the holders of at least a majority of the total voting power of the Company’s capital stock at any time when the Sellers or their Permitted Transferees beneficially own, in the aggregate, 40% or more of the voting power of the Company’s capital stock entitled to vote generally in the election of directors, voting as a single class and (ii) the affirmative vote of the holders of at least 6623% of the total voting power of the Company’s capital stock at any time when the Sellers or their Permitted Transferees beneficially own, in the aggregate, less than 40% of the voting power of the Company’s capital stock entitled to vote generally in the election of directors, voting as a single class (we refer to this as “advisory charter proposal F”);

 

  (vii)

to provide that any director may be removed from the board of directors upon a good faith finding by the board of directors that such director is an Unsuitable Person (as defined in the Proposed Charter) (we refer to this as “advisory charter proposal G”);



 

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  (viii)

to provide that any action required or permitted to be taken by the Company’s stockholders at any annual or special meeting of the stockholders of the Company may be taken by written consent (without a meeting) at any time that the Sellers and their Permitted Transferees beneficially own, in the aggregate, 40% or more of the voting power of the Company’s outstanding capital stock entitled to vote generally in the election of directors if a consent in writing, setting forth the action to be taken, is signed by the holders of outstanding stock having no less than the minimum number of votes necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and voted (we refer to this as “advisory charter proposal H”);

 

  (ix)

to provide that if the Delaware Court of Chancery lacks subject matter jurisdiction over a claim brought against or on behalf of the Company or any of its directors, officers, employees or stockholders, then the sole and exclusive forum for such action shall be another state or federal court located within the state of Delaware, unless the Court of Chancery (or such other state or federal court located within the state of Delaware, as applicable) has dismissed a prior action by the same plaintiff asserting the same claims because such court lacked personal jurisdiction over an indispensable party named as a defendant therein, and to provide further that any cause of action arising under the Securities Act of 1933, as amended, that is asserted against the Company shall be brought in the federal district courts of the United States unless the Company consents in writing to an alternate forum, and to provide further that failure to enforce the forum selection clause of the Proposed Charter would cause the Company irreparable harm and entitle the Company to equitable relief to enforce the forum selection clause (we refer to this as “advisory charter proposal I”); and

 

  (x)

to provide for certain additional changes, including, among other things, (i) changing the post-business combination company’s corporate name from “dMY Technology Group, Inc.” to “Rush Street Interactive, Inc.”, (ii) making the Company’s corporate existence perpetual and (iii) removing certain provisions related to our status as a blank check company that will no longer apply upon consummation of the business combination, all of which our board of directors believes are necessary to adequately address the needs of the post-business combination Company (we refer to this as “advisory charter proposal J”)

The Proposed Charter differs in material respects from the Charter and we urge stockholders to carefully consult the information set out in the Section “The Charter Amendment Proposal” and the full text of the Proposed Charter, attached hereto as Annex B.

The charter amendment proposal is conditioned on the approval of the business combination proposal. Therefore, if the business combination proposal is not approved, the charter amendment proposal will have no effect, even if approved by our public stockholders.

The Advisory Charter Proposals

Our stockholders are also being asked to approve and adopt, on a non-binding advisory basis, in accordance with SEC guidance to give stockholders the opportunity to present their separate views on important corporate governance provisions, the advisory charter proposals, which are those amendments that will be made to the Charter as reflected in the Proposed Charter if the charter amendment proposal is approved.

For additional information, see “The Advisory Charter Proposals” section of this proxy statement.



 

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The NYSE Proposal

Assuming the business combination proposal and the charter amendment proposal are approved, our stockholders are also being asked to approve the NYSE proposal.

The Company may issue 20% or more of our outstanding common stock or 20% or more of the voting power, in each case outstanding before the issuance, in connection with the Business Combination. The NYSE proposal is a proposal to approve, assuming the business combination proposal and the charter amendment proposal are approved and adopted, for the purposes of complying with the applicable listing rules of NYSE, (x) the issuance of more than 20% of our issued and outstanding common stock (i) pursuant to the terms of the Business Combination Agreement, (ii) upon the exchange of the Retained RSI Units pursuant to the RSI A&R LPA and (iii) the issuance of Class A Common Stock in connection with subscription agreements entered into in connection with the Business Combination, in each case, that may result in the Sellers or any other investor owning more than 20% of our outstanding common stock, or more than 20% of the voting power, which could constitute a “change of control” under NYSE rules;

If the NYSE proposal is adopted, (i) 16,043,002 shares of Class A Common Stock are issuable pursuant to the Subscription Agreements, (ii) up to 145,000,000 shares of Class V Voting Stock will be issued to the Sellers pursuant to the terms of the Business Combination Agreement, which will represent approximately 76.89% of the 188,580,189 shares of our common stock outstanding following the Business Combination, assuming (a) none of dMY’s public shareholders exercise redemption rights with respect to their public shares, (b) the parties to the Business Combination Agreement incur $30 million of transaction expenses, (c) the Put-Calls are in effect as of the Closing and are validly exercised shortly following the closing or are not in effect, (d) the maximum amount of Purchased RSI Units are purchased from the Sellers (other than the Put-Call Sellers) (i.e., $99,235,500 if the Put-Calls are in effect or $125,000,000 if the Put-Calls are not in effect) at Closing, (e) none of the 1,205,937 Founder Holders Forfeiture Shares are forfeited because the Available Closing Date Cash exceeds $245,000,000, (f) the Earnout Shares are excluded unless and until they are earned in accordance with the Business Combination Agreement, and (g) no exercise of Sponsor’s 6,600,000 private placement warrants at an exercise price of $11.50 per share (which warrants are not exercisable until the later of 12 months from the closing of the IPO and 30 days after the completion of the Business Combination), and (iii) up to 145,000,000 shares of Class A Common Stock are issuable in the future to the Sellers who exchange their Retained RSI Units for Class A Common Stock and forfeit an equal number of shares of Class V Voting Stock held by them from time to time following the Closing pursuant to and in accordance with the terms of the RSI A&R LPA.

For additional information, see “The NYSE Proposal” section of this proxy statement

The Incentive Plan Proposal

Assuming the business combination proposal, the charter amendment proposal and the NYSE proposal are approved, our stockholders are also being asked to approve the incentive plan proposal.

We expect that, prior to the consummation of the Business Combination, our Board will approve and adopt the Plan. Our stockholders should carefully read the entire Plan, a copy of which is attached to this proxy statement as Annex C, before voting on this proposal.

For additional information, see “The Incentive Plan Proposal” section of this proxy statement.

The Director Election Proposal

Assuming the condition precedent proposals are approved, our Board has nominated nine directors to serve staggered terms on our Board, with each Class I director having a term that expires at the Company’s annual meeting of stockholders in 2021, each Class II director having a term that expires at the Company’s annual



 

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meeting of stockholders in 2022 and each Class III director having a term that expires at the Company’s annual meeting of stockholders in 2023, or until such directors’ successors have been duly elected and qualified, or until such directors’ earlier death, resignation, retirement or removal.

For additional information, see “The Director Election Proposal” section of this proxy statement.

The Adjournment Proposal

The adjournment proposal allows the Board to submit a proposal to approve the adjournment of the special meeting to a later date or dates, if necessary or appropriate, to permit further solicitation of proxies in the event that there are insufficient votes for, or otherwise in connection with, the approval of any of the condition precedent proposals, the advisory charter proposals or the director election proposal.

For additional information, see “The Adjournment Proposal” section of this proxy statement.

Date, Time and Place of Special meeting of dMY’s Stockholders

The special meeting will be held via live webcast at 10:00 AM, Eastern time, on [•], 2020, at [•], to consider and vote upon the proposals to be put to the special meeting, including if necessary, the adjournment proposal. The special meeting can be accessed by visiting [•], where you will be able to listen to the meeting live and vote during the meeting. Please note that you will only be able to access the special meeting by means of remote communication. Please have your control number, which can be found on your proxy card, to join the special meeting. If you do not have a control number, please contact the Continental Stock Transfer Company, the transfer agent.

Registering for the Special Meeting

Pre-registration at [•] is recommended but is not required in order to attend.

Any stockholder wishing to attend the virtual meeting should register for the meeting by [•], 2020. To register for the special meeting, please follow these instructions as applicable to the nature of your ownership of our common stock:

 

   

If your shares are registered in your name with Continental Stock Transfer & Trust Company and you wish to attend the online-only special meeting, go to [•], enter the 12-digit control number included on your proxy card or notice of the meeting and click on the “Click here to preregister for the online meeting” link at the top of the page. Just prior to the start of the meeting you will need to log back into the meeting site using your control number. Pre-registration is recommended but is not required in order to attend.

 

   

Beneficial stockholders (those holding shares through a stock brokerage account or by a bank or other holder of record) who wish to attend the virtual meeting must obtain a legal proxy by contacting their account representative at the bank, broker, or other nominee that holds their shares and e-mail a copy (a legible photograph is sufficient) of their legal proxy to proxy@continentalstock.com. Beneficial stockholders who e-mail a valid legal proxy will be issued a 12-digit meeting control number that will allow them to register to attend and participate in the special meeting. After contacting Continental Stock Transfer & Trust Company, a beneficial holder will receive an e-mail prior to the meeting with a link and instructions for entering the virtual meeting. Beneficial stockholders should contact Continental Stock Transfer & Trust Company at least five (5) business days prior to the meeting date in order to ensure access.



 

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Voting Power; Record Date

Stockholders will be entitled to vote or direct votes to be cast at the special meeting if they owned shares of dMY common stock at the close of business on [•], 2020, which is the record date for the special meeting. Stockholders will have one vote for each share of common stock owned at the close of business on the record date. If your shares are held in “street name” or are in a margin or similar account, you should contact your broker to ensure that votes related to the shares you beneficially own are properly counted. Our warrants do not have voting rights. On the record date, there were 28,750,000 shares of dMY common stock outstanding, of which 23,000,000 were public shares, with the rest being held by our initial stockholders.

Quorum and Vote of Stockholders

A quorum of our stockholders is necessary to hold a valid meeting. The presence, in person (which would include presence at the virtual special meeting) or by proxy, of stockholders holding a majority of the shares entitled to vote at the special meeting constitutes a quorum at the special meeting. In the absence of a quorum, the chairperson of the special meeting has the power to adjourn the special meeting. As of the record date for the special meeting, 14,375,001 shares of dMY common stock would be required to achieve a quorum.

Our initial stockholders and our other officers and directors at the time of the IPO entered into a letter agreement to vote their founder shares as well as any public shares purchased during or after the IPO, in favor of the business combination proposal. As of the date hereof, our initial stockholders own approximately 20% of our total outstanding common shares.

The following votes are required for each proposal at the special meeting:

 

   

Business combination proposal: The approval of the business combination proposal requires the affirmative vote of a majority of the votes cast by holders of Class A Common Stock and Class B Common Stock present in person or represented by proxy and entitled to vote at the special meeting, voting as a single class.

 

   

Charter amendment proposal: The approval of the charter amendment proposal requires the affirmative vote of holders of a majority of the outstanding shares of Class A Common Stock and Class B Common Stock entitled to vote thereon at the special meeting, voting as a single class.

 

   

Advisory charter proposals: The approval of each of the advisory charter proposals, each of which is a non-binding advisory vote, requires the affirmative vote of a majority of the votes cast by holders of Class A Common Stock and Class B Common Stock present in person or represented by proxy and entitled to vote at the special meeting, voting as a single class.

 

   

NYSE proposal: The approval of the NYSE proposal requires the affirmative vote of a majority of the votes cast by holders of Class A Common Stock and Class B Common Stock present in person or represented by proxy and entitled to vote at the special meeting, voting as a single class.

 

   

Director election proposal: The election of the director nominees pursuant to the director election proposal requires a plurality of the votes cast by holders of Class A Common Stock and Class B Common Stock present in person or represented by proxy and entitled to vote at the special meeting, voting as a single class.

 

   

Incentive plan proposal: The approval of the incentive plan proposal requires the affirmative vote of a majority of the votes cast by holders of Class A Common Stock and Class B Common Stock present in person or represented by proxy and entitled to vote at the special meeting, voting as a single class.



 

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Adjournment proposal: The approval of the adjournment proposal requires the affirmative vote of a majority of the votes cast by holders of Class A Common Stock and Class B Common Stock present in person or represented by proxy and entitled to vote at the special meeting, voting as a single class.

With respect to each proposal in this proxy statement (other than the director election proposal), you may vote “FOR,” “AGAINST” or “ABSTAIN.” With respect to the director election proposal, you may vote “FOR” or “WITHHOLD” with respect to each nominee.

If a stockholder fails to return a proxy card or fails to instruct a broker or other nominee how to vote, and does not attend the Special Meeting in person, then the stockholder’s shares will not be counted for purposes of determining whether a quorum is present at the special meeting. If a valid quorum is established, any such failure to vote or to provide voting instructions will have the same effect as a vote “AGAINST” the charter amendment proposal, but will have no effect on the outcome of any other proposal in this proxy statement.

Abstentions and “WITHHOLD” votes will be counted in connection with the determination of whether a valid quorum is established but their effect on the proposals in this proxy statement differ as follows:

 

   

An abstention will have no effect on the business combination proposal, the advisory charter proposals and the adjournment proposal, and for the director election proposal, a “WITHOLD” vote will have the same effect as an abstention and will not count as a vote “FOR” or “AGAINST” a director because directors are elected by plurality voting.

 

   

In contrast, an abstention will have the same effect as a vote “AGAINST” the charter amendment proposal. Moreover, for purposes of the NYSE proposal and the incentive plan proposal, the NYSE considers an abstention vote as a “vote cast”, and therefore, an abstention will have the same effect as a vote “AGAINST” such proposals.

Redemption Rights

Pursuant to the Charter, a public stockholder may request that dMY redeem all or a portion of such public stockholder’s public shares for cash if the Business Combination is consummated. You will be entitled to receive cash for any public shares to be redeemed only if you:

 

  (i)

(a) hold public shares or (b) hold public shares through units and you elect to separate your units into the underlying public shares and public warrants prior to exercising your redemption rights with respect to the public shares; and

 

  (ii)

prior to 10:00AM, Eastern Time, on [•], 2020 (two business days prior to the vote at the special meeting) (a) submit a written request to the transfer agent that the Company redeem your public shares for cash and (b) deliver your public shares to the transfer agent, physically or electronically through DTC.

As noted above, holders of units must elect to separate the underlying public shares and public warrants prior to exercising redemption rights with respect to the public shares. Holders may instruct their broker to do so, or if a holder holds units registered in its own name, the holder must contact the transfer agent directly and instruct it to do so. Public stockholders may elect to redeem all or a portion of such public stockholder’s public shares even if they vote for the business combination proposal. If the Business Combination is not consummated, the public shares will not be redeemed for cash. If a public stockholder properly exercises its right to redeem its public shares and timely delivers its public shares to the transfer agent, dMY will redeem each share of Class A Common Stock for 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 the Business Combination, including interest earned on the funds held



 

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in the trust account (net of taxes payable), divided by the number of then-outstanding public shares. If a public stockholder exercises its redemption rights, then it will be exchanging its redeemed public shares for cash and will no longer own such shares. Any request to redeem public shares, once made, may be withdrawn at any time until the deadline for exercising redemption requests and thereafter, with our consent, until the Closing. Furthermore, if a holder of a public shares delivers its certificate in connection with an election of its redemption and subsequently decides prior to the Closing not to elect to exercise such rights, it may simply request that dMY instruct our transfer agent to return the certificate (physically or electronically). The holder can make such request by contacting the transfer agent, at the address or email address listed in this proxy statement. We will be required to honor such request only if made prior to the deadline for exercising redemption requests. See “Special Meeting — Redemption Rights” for a detailed description of the procedures to be followed if you wish to redeem your public shares for cash.

Notwithstanding the foregoing, a holder of public shares, together with any affiliate of such public stockholder or any other person with whom such public stockholder is acting in concert or as a “group” (as defined in Section 13 of the Exchange Act), will be restricted from redeeming its public shares with respect to more than an aggregate of 20% of the public shares, without our prior consent. Accordingly, if a public stockholder, alone or acting in concert or as a group, seeks to redeem more than 20% of the public shares, then any such shares in excess of that 20% limit would not be redeemed for cash, without our prior consent.

In order for public stockholders to exercise their redemption rights in respect of the business combination proposal, public stockholders must properly exercise their right to redeem the public shares they hold no later than the close of the vote on the business combination proposal and deliver their public shares (either physically or electronically) to the transfer agent prior to 10:00 AM, Eastern Time, on [•], 2020 (two business days prior to the vote at the special meeting). Immediately following the consummation of the Business Combination, the Company will satisfy the exercise of redemption rights by redeeming the public shares issued to the public stockholders that validly exercised their redemption rights.

Holders of our warrants will not have redemption rights with respect to the warrants.

Appraisal Rights

Neither our stockholders nor our warrant holders have appraisal rights in connection with the Business Combination under the DGCL.

Proxy Solicitation

Proxies may be solicited by mail, telephone or in person. dMY has engaged Morrow Sodali LLC to assist in the solicitation of proxies.

If a stockholder grants a proxy, it may still vote its shares in person (which would include presence at the virtual special meeting) if it revokes its proxy before the special meeting. A stockholder also may change its vote by submitting a later-dated proxy as described in the section entitled “Special Meeting — Revoking Your Proxy.”

Interests of Certain Persons in the Business Combination

In considering the recommendation of our Board to vote in favor of the Business Combination, stockholders should be aware that, aside from their interests as stockholders, our Sponsor and our directors, officers and advisors and RSI’s current owners have interests in the Business Combination that are different from, or in addition to, those of our other stockholders generally. Our directors were aware of and considered these interests, among other matters, in evaluating the Business Combination, and in recommending to our stockholders that



 

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they approve the Business Combination. Stockholders should take these interests into account in deciding whether to approve the Business Combination. These interests include, among other things:

 

   

the fact that our initial stockholders have waived their right to redeem any of the founder shares and public shares in connection with a stockholder vote to approve a proposed initial business combination;

 

   

the fact that our initial stockholders paid an aggregate of $25,000 for the founder shares, which will convert into 5,750,000 shares of Class A Common Stock (of which 1,212,813 shares are subject to earnout (the “Initial Stockholders Earnout Shares”) in accordance with the Business Combination Agreement and 1,205,937 shares are subject to forfeiture in accordance with the Founder Holders Forfeiture Agreement (the “Initial Stockholders Forfeiture Shares”)) in accordance with the terms of the Charter and the amendment to a letter agreement, originally entered into on February 20, 2020, executed in connection with the Business Combination Agreement, by and among certain current officers and directors of the Company, the Sponsor, the Company, RSI and the Sellers’ Representative (the “Amended Insider Letter”), and such securities will have a significantly higher value at the time of the Business Combination, estimated at approximately $[•] based on the closing price of $10.[•] per public share on the NYSE on [•], 2020;

 

   

the fact that our initial stockholders have agreed to waive their rights to liquidating distributions from the trust account with respect to their founder shares if we fail to complete an initial business combination by February 25, 2022;

 

   

the fact that our Sponsor paid approximately $6,600,000 for 6,600,000 private placement warrants, each of such private placement warrants is exercisable commencing on the later of 12 months from the closing of the IPO and 30 days following the Closing for one share of Class A Common Stock for one share of Class A Common Stock at $11.50 per share; if we do not consummate an initial business combination by February 25, 2022, then the proceeds from the sale of the private placement warrants will be part of the liquidating distribution to the public stockholders and the warrants held by our Sponsor will be worthless; the warrants held by our Sponsor had an aggregate market value of approximately $[•] based upon the closing price of $0.[•] per warrant on the NYSE on [•], 2020;

 

   

the right of our Sponsor to receive approximately 6,600,000 shares of Class A Common Stock to be issued upon exercise of its private placement warrants following the Business Combination, subject to certain lock-up periods;

 

   

if the trust account is liquidated, including in the event we are unable to complete an initial business combination within the required time period, our Sponsor has agreed that it will be liable to us if and to the extent any claims by a third-party (other than our independent registered public accounting firm) for services rendered or products sold to us, or a prospective target business with which we have entered into a written letter of intent, confidentiality or other similar agreement or business combination agreement, reduce the amount of funds in the trust account to below: (i) $10.00 per public share; or (ii) such lesser amount per public share held in the trust account as of the date of the liquidation of the trust account due to reductions in the value of the trust assets, in each case, net of the interest which may be withdrawn to pay taxes and up to $100,000 of interest to pay dissolution expenses, except as to any claims by a third-party who executed a waiver of any and all rights to seek access to the trust account and except as to any claims under our indemnity of the underwriters of the IPO against certain liabilities, including liabilities under the Securities Act;

 

   

the anticipated election of Harry L. You and Niccolo de Masi, our Chairman and Chief Executive Officer, respectively, as directors of the Company after the consummation of the Business



 

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Combination. As such, in the future they will receive any cash fees, stock options or stock awards that the Board determines to pay to our directors;

 

   

pursuant to an Investor Rights Agreement, the Sponsor will have the right to nominate two directors to the Board and the Sellers will have the right to nominate the remaining directors of the Board and the Sellers will have the right to appoint up to three non-voting board observers to the Board, in each case subject to certain conditions;

 

   

the continued indemnification of our existing directors and officers and the continuation of our directors’ and officers’ liability insurance after the Business Combination;

 

   

the fact that the Sellers, who (i) will have the right to designate directors to the Board pursuant to the Investor Rights Agreement, and (ii) include members of RSI’s management team who will become executive officers and directors of the Company following the Business Combination, will hold a significant number of shares of Class V Voting Stock and an equal number of Retained RSI Units that are redeemable for shares of Class A Common Stock in accordance with the terms of the RSI A&R LPA; and

 

   

the fact that Goldman will be entitled to receive a deferred underwriting commission and a financial advisory fee upon completion of the business combination.

At any time prior to the special meeting, during a period when they are not then aware of any material nonpublic information regarding dMY or our securities, the dMY initial stockholders, RSI and/or its affiliates may purchase shares and/or warrants from investors, or they may enter into transactions with such investors and others to provide them with incentives to acquire shares of dMY common stock or vote their shares in favor of the business combination proposal. The purpose of such share purchases and other transactions would be to increase the likelihood that the proposals presented to stockholders for approval at the special meeting are approved or to provide additional equity financing. Any such share purchases and other transactions may thereby increase the likelihood of obtaining stockholder approval of the Business Combination. This may result in the completion of our Business Combination that may not otherwise have been possible. While the exact nature of any such incentives has not been determined as of the date of this proxy statement, they might include, without limitation, arrangements to protect such investors or holders against potential loss in value of their shares, including the granting of put options.

Entering into any such incentive arrangements may have a depressive effect on shares of dMY common stock. For example, as a result of these arrangements, an investor or holder may have the ability to effectively purchase shares at a price lower than market and may therefore be more likely to sell the shares he owns, either prior to or immediately after the special meeting.

If such transactions are effected, the consequence could be to cause the Business Combination to be approved in circumstances where such approval could not otherwise be obtained. Purchases of shares by the persons described above would allow them to exert more influence over the approval of the proposals to be presented at the special meeting and would likely increase the chances that such proposals would be approved. As of the date of this proxy statement, there have been no such discussions and no agreements to such effect have been entered into with any such investor or holder. dMY will file a Current Report on Form 8-K to disclose any arrangements entered into or significant purchases made by any of the aforementioned persons that would affect the vote on the proposals to be voted on at the special meeting or the amount of Available Equity. Any such report will include descriptions of any arrangements entered into or significant purchases by any of the aforementioned persons.

The existence of financial and personal interests of our directors and officers may result in conflicts of interest, including a conflict between what may be in the best interests of the Company and its stockholders and



 

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what may be best for a director’s personal interests when determining to recommend that stockholders vote for the proposals. See the sections entitled “Risk Factors”, “The Business Combination Proposal — Interests of Certain Persons in the Business Combination” and “Beneficial Ownership of Securities” for more information and other risks.

Certain Other Benefits in the Business Combination

In addition to the interests of the Company’s directors and officers in the Business Combination, stockholders should be aware that Goldman has financial interests that are different from, or in addition to, the interests of our stockholders.

Goldman was an underwriter in our IPO, and, upon consummation of the Business Combination, the underwriters of the IPO are entitled to $8,050,000 of deferred underwriting commission, of which Goldman is entitled to $6,400,000. The underwriters of the IPO have agreed to waive their rights to the deferred underwriting commission held in the trust account in the event the Company does not complete an initial business combination within 24 months of the closing of the IPO. Accordingly, if the Business Combination, or any other initial business combination, is not consummated by that time and the Company is therefore required to be liquidated, the underwriters of the initial public offering, including Goldman, will not receive any of the deferred underwriting commission and such funds will be returned to the Company’s public stockholders upon its liquidation.

Furthermore, Goldman is engaged by the Company as its financial advisor. The Company decided to retain Goldman as its financial advisor based primarily on Goldman’s extensive knowledge, strong market position and positive reputation in equity capital markets and its experienced and capable investment banking team.

In addition, under the terms of Goldman’s engagement, the Company agreed to reimburse Goldman for its reasonable out-of-pocket expenses, including the fees and disbursements of its outside attorneys, and to indemnify Goldman and certain related parties against liabilities, including liabilities under federal securities laws, in each case, in connection with, as a result of, or relating to its engagement.

Goldman therefore has an interest in the Company completing a business combination that will result in the payment of the deferred underwriting commission to the underwriters of the IPO, including Goldman. In considering approval of the Business Combination, the Company’s stockholders should consider the roles of Goldman in light of the deferred underwriting commission Goldman is entitled to receive if the Business Combination is consummated within 24 months of the closing of the IPO.

Recommendation of the Board

The Board believes that the business combination proposal and the other proposals to be presented at the special meeting are in the best interest of dMY’s stockholders and unanimously recommends that our stockholders vote “FOR” the business combination proposal, “FOR” the charter amendment proposal, “FOR” the separate advisory charter proposal, “FOR” the NYSE proposal, “FOR” the incentive plan proposal, “FOR” each of the director nominees set forth in the director election proposal and “FOR” the adjournment proposal, in each case, if presented to the special meeting.

Conditions to the Closing of the Business Combination

Unless waived by the parties to the Business Combination Agreement, and subject to applicable law, the consummation of the Business Combination is subject to a number of conditions set forth in the Business Combination Agreement including, among other things, approval by dMY’s stockholders of the Business



 

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Combination Agreement and the Business Combination. In addition, unless waived by the Sellers’ Representative or the Company, and subject to applicable law, the consummation of the Business Combination is subject to the conditions that (x) the Company has Available Closing Date Cash of at least $160,000,000 minus the amount by which the transaction expenses incurred by RSI and the Sellers exceeds $12,500,000 and (y) all approvals, determinations, grants, confirmations and other conditions with respect to gaming regulatory authorities in connection with the transactions contemplated by the Business Combination Agreement and the related agreements have been made, obtained, satisfied or given and in full force and effect. For more information about conditions to the consummation of the Business Combination, see “The Business Combination Proposal — The Business Combination Agreement — Conditions to the Closing of the Business Combination.”

Sources and Uses of Funds for the Business Combination

The following table summarizes the sources and uses for funding the Business Combination. Where actual amounts are not known or knowable, the figures below represent dMY’s good faith estimate of such amounts.

Sources and Uses of Proceeds

($ in millions)

 

Sources

   No
Redemption(1)
     Max
Redemption(2)
 

Cash Held in Trust Account(1)

   $ 230.0      $ 230.0  

Private Placement Equity Financing(2)

     160.4        160.4  

Sellers’ Equity

     1,725.0        1,725.0  

Initial Stockholder Equity(3)

     57.5        57.5  
  

 

 

    

 

 

 

Total Sources

   $     2,172.9      $     2,172.9  
  

 

 

    

 

 

 

 

(1)

Represents the expected amount of the cash held in the Company’s trust account prior to the Closing (and prior to any redemption by dMY shareholders), excluding any interest earned on the funds.

 

(2)

Represents the proceeds from the PIPE as of the consummation of the Business Combination.

 

(3)

Includes 75,000 founder shares that have been transferred to dMY’s independent directors.

 

Uses

   No
Redemption(1)
     Max
Redemption(1)
 

Cash to Acquire Purchased RSI Units from Sellers(1)

   $ 99.2      $ 0.0  

Transaction Expenses(2)

     30.0        30.0  

Shareholder Redemptions(3)

     0.0        200.4  

Cash Contribution to RSI

     261.2        160.0  

Sellers’ Equity(4)

     1,625.8            1,725.0  

Initial Stockholder Equity(5)

     57.5        57.5  

RSI ASLP, Inc. Purchased RSI Units from Sellers(6)

     99.2        0.0  
  

 

 

    

 

 

 

Total Uses

   $     2,172.9      $ 2,172.9  
  

 

 

    

 

 

 

 

(1)

Assumes that the Put-Calls are in effect and represents the expected amount of cash required to purchase the Purchased RSI Units (other than the Put-Call Units) from the Sellers (other than the Put-Call Sellers) at the Closing.

 

(2)

Represents the total estimated transaction fees and expenses incurred by the parties to the Business Combination Agreement.



 

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(3)

Assumes that the maximum number of Class A Shares that can be redeemed are redeemed while still satisfying the Minimum Cash Condition, and that there is no Permitted Equity Financing to replace such redemption.

 

(4)

Represents Sellers’ Equity after RSI ASLP, Inc.’s acquisition of Purchased RSI Units (other than Put-Call Units) from Sellers (other than Put-Call Sellers) (and Sellers’ (other than Put-Call Sellers’) forfeiture of a corresponding number of shares of Class V Voting Stock) in accordance with the Business Combination Agreement.

 

(5)

Includes 75,000 founder shares that have been transferred to dMY’s independent directors.

 

(6)

Assumes that the Put-Calls are in effect and represents the Purchased RSI Units (other than the Put-Call Units) acquired by RSI ASLP, Inc. (and Sellers’ (other than the Put-Call Sellers’) forfeiture of a corresponding number of shares of Class V Voting Stock) in accordance with the Business Combination Agreement.

 

(1)

Assumes that none of the holders of public shares of Class A Common Stock exercise their redemption rights.

 

(2)

Assumes that holders of 20,043,002 shares of Class A Common Stock exercise their redemption rights (representing the maximum amount of public shares that can be redeemed to satisfy the Minimum Cash Condition).

United States Federal Income Tax Considerations

For a discussion summarizing the United States federal income tax considerations of an exercise of redemption rights, please see “United States Federal Income Tax Considerations.

Anticipated Accounting Treatment

For a discussion summarizing the anticipated accounting treatment of the Business Combination, please see “Anticipated Accounting Treatment.

Regulatory Matters

The Business Combination is not subject to any federal, state or other regulatory requirements or approvals, except for (i) the approvals, determinations, grants, confirmations and other conditions with respect to gaming regulatory authorities required in connection with the transactions contemplated by the Business Combination Agreement and the Ancillary Agreements and (ii) filings with the State of Delaware necessary to effectuate the transactions contemplated by the Business Combination Agreement.

Risk Factors

In evaluating the proposals to be presented at the special meeting, a stockholder should carefully read this proxy statement and especially consider the factors discussed in the section entitled “Risk Factors.”

Sources of Industry and Market Data

Where information has been sourced from a third-party, the source of such information has been identified. Unless otherwise indicated, the information contained in this proxy statement on the market environment, market developments, growth rates, market trends and competition in the markets in which dMY and RSI operate is taken from publicly available sources, including third-party sources, or reflects dMY’s or RSI’s estimates that are principally based on information from publicly available sources.



 

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Emerging Growth Company and Smaller Reporting Company

dMY is an “emerging growth company,” as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012, as amended (the “JOBS Act”), and we may take advantage of certain exemptions from various reporting requirements that are applicable to other companies that are not emerging growth companies, including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, as amended (“SOX”), reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved.

Further, section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. dMY intends to take advantage of the benefits of this extended transition period. This may make comparison of dMY’s financial statements with certain other public companies difficult or impossible because of the potential differences in accounting standards used.

dMY will remain an emerging growth company until the earlier of (i) the last day of the fiscal year (a) following the fifth anniversary of the completion of our IPO, (b) in which we have total annual gross revenue of at least $1.07 billion (as adjusted for inflation pursuant to SEC rules from time to time), or (c) in which we are deemed to be a large accelerated filer, which means the market value of our shares of Class A Common Stock that are held by non-affiliates exceeds $700 million as of the prior June 30th, and (ii) the date on which we issued more than $1.00 billion in non-convertible debt during the prior three-year period.

Additionally, we are a “smaller reporting company” as defined in Item 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. We will remain a smaller reporting company until the last day of the fiscal year in which (1) the market value of our common stock held by non-affiliates exceeds $250 million as of the end of that fiscal year’s second fiscal quarter, or (2) our annual revenues exceeded $100 million during such completed fiscal year and the market value of our common stock held by non-affiliates exceeds $700 million as of the end of that fiscal year’s second fiscal quarter. To the extent we take advantage of such reduced disclosure obligations, it may also make comparison of our financial statements with other public companies difficult or impossible.



 

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SELECTED HISTORICAL FINANCIAL INFORMATION OF RSI

The following selected financial data is only a summary for RSI’s combined financial statements and should be read in conjunction with RSI’s combined financial statements and related notes and RSI’s Management’s Discussion and Analysis of Financial Condition and Results of Operations” contained elsewhere in this proxy statement. RSI’s historical results are not necessarily indicative of future results, and the results for any interim period are not necessarily indicative of the results that may be expected for the full fiscal year. The following selected statement of operations data and statement of cash flows data for RSI’s nine months ended September 30, 2020 and September 30, 2019, fiscal year 2019 and fiscal year 2018, and balance sheet data for RSI as of September 30, 2020, December 31, 2019 and 2018 have been derived from RSI’s consolidated financial statements included elsewhere in the proxy statement.

 

     Nine Months Ended
September 30,
    Year Ended
December 31,
 

in thousands

   2020     2019     2019     2018  

Statement of Operations Data:

        

Revenues

   $ 178,452     $ 35,848     $ 63,667     $ 18,226  

Net loss

   $ (90,027   $ (7,360   $ (22,450   $ (10,735

Statement of Cash Flows:

        

Net cash provided by (used in) operating activities

   $ 2,559     $ (7,414   $ (2,459   $ (5,138

Net cash used in investing activities

   $ (4,696   $ (5,645   $ (5,770   $ (644

Net cash provided by financing activities

   $ 7,150     $ 14,500     $ 15,545     $ 8,000  

Balance Sheet:

        

Total assets

   $ 68,574       $ 25,543     $ 8,165  

Total liabilities

   $ 154,221       $ 28,911     $ 10,704  

Preferred units

   $ 34,437       $ 28,073     $ —    

Total members’ deficit

   $ (120,084     $ (31,441   $ (2,539

Non-GAAP Information

This proxy statement includes Adjusted EBITDA, which is a non-GAAP performance measure that we use to supplement our results presented in accordance with U.S. GAAP. We believe Adjusted EBITDA is useful in evaluating our operating performance, as it is similar to measures reported by our public competitors and is regularly used by security analysts, institutional investors and other interested parties in analyzing operating performance and prospects. Adjusted EBITDA is not intended to be a substitute for any U.S. GAAP financial measure and, as calculated, may not be comparable to other similarly titled measures of performance of other companies in other industries or within the same industry.

RSI defines Adjusted EBITDA as net income (loss) before interest expense, income taxes, depreciation and amortization, share-based compensation, adjustments for certain one-time or non-recurring items and other adjustments. We include this non-GAAP financial measure because it is used by management to evaluate RSI’s core operating performance and trends and to make strategic decisions regarding the allocation of capital and new investments. Adjusted EBITDA excludes certain expenses that are required in accordance with U.S. GAAP because non-cash (for example, in the case of depreciation and amortization, share-based compensation) or are not related to our underlying business performance (for example, in the case of interest income, net).



 

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The table below presents our Adjusted EBITDA reconciled from our comprehensive loss, the closest U.S. GAAP measure, for the periods indicated:

 

     Nine Months Ended
September 30,
    Year Ended
December 31,
 

($ in thousands)

   2020     2019     2019     2018  
     (Unaudited)              

Comprehensive loss

   $ (94,759   $ (7,174   $ (30,984   $ (10,867
  

 

 

   

 

 

   

 

 

   

 

 

 

Depreciation and amortization

     1,368       799       1,139       898  

Interest, net

     101       92       123       42  

Deemed dividend on preferred units

     4,288       —         8,544       —    

Share-based compensation expense

     103,282       —         13,407       —    
  

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted EBITDA

   $ 14,280     $ (6,283   $ (7,771   $ (9,927
  

 

 

   

 

 

   

 

 

   

 

 

 


 

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COMPARATIVE SHARE INFORMATION

The following table sets forth selected historical comparative share and unit information for dMY and RSI and unaudited pro forma condensed combined per share information of dMY after giving effect to the Business Combination, assuming two redemption scenarios as follows.

 

   

Assuming No Redemptions: This presentation assumes that (i) none of the holders of public shares of Class A Common Stock exercise their redemption rights, (ii) the parties to the Business Combination Agreement incur $30 million of transaction expenses, (iii) the Put-Calls are in effect as of the Closing and are validly exercised shortly following the Closing or are not in effect, (iv) the maximum amount of Purchased RSI Units are purchased from the Sellers (other than the Put-Call Sellers) (i.e., $99,235,500 if the Put-Calls are in effect or $125,000,000 if the Put-Calls are not in effect) at Closing, (v) none of the 1,205,937 Founder Holders Forfeiture Shares are forfeited because the Available Closing Date Cash exceeds $245,000,000, (vi) the Earnout Shares are excluded unless and until such shares become earned in accordance with the Business Combination Agreement, (vii) there is no exercise at the Closing of the Sponsor’s 6,600,000 private placement warrants at an exercise price of $11.50 per share (which warrants are not exercisable until the later of 12 months from the closing of the IPO and 30 days after the completion of the Business Combination), (viii) none of the parties set forth above purchase shares of Class A Common Stock in the open market, (ix) there are no other issuances of equity interests of the Company prior to or in connection with the Closing and (x) there are no issuances of any shares of the Company’s Class A Common Stock within the five business days following the Closing to additional private placement investors or following the Closing under the Plan.

 

   

Assuming Maximum Redemptions: This presentation assumes that approximately 87% of dMY’s public stockholders exercise redemption rights with respect to their public shares (representing the maximum amount of public shares that can be redeemed to satisfy the Minimum Cash Condition). This scenario assumes that 20,043,002 public shares are redeemed for an aggregate redemption payment of approximately $200,430,020, based on $230.8 million in the trust and 23,000,000 public shares outstanding as of September 30, 2020. In accordance with the Charter, a public stockholder, together with any affiliate of his or hers, or any other person with whom he or she is acting in concert or as a “group” (as defined in Section 13(d)(3) of the Exchange Act) will be restricted from redemption with respect to 20% or more of public shares without the Company’s prior written consent. In no event will the Company redeem the public shares in an amount that would cause its net tangible assets to be less than $5,000,001.

The pro forma book value information reflects the Business Combination as if it had occurred on September 30, 2020. The weighted average shares outstanding and net earnings per share information reflect the Business Combination as if it had occurred on January 1, 2019.

This information is only a summary and should be read together with the selected historical financial information included elsewhere in this proxy statement, and the historical financial statements of dMY and RSI and related notes that are included elsewhere in this proxy statement. The unaudited pro forma combined per share information of dMY and RSI is derived from, and should be read in conjunction with, the unaudited pro forma condensed combined financial statements and related notes included elsewhere in this proxy statement.



 

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The unaudited pro forma combined earnings per share information below does not purport to represent the earnings per share which would have occurred had the companies been combined during the periods presented, nor earnings per share for any future date or period. The unaudited pro forma combined book value per share information below does not purport to represent what the value of dMY and RSI would have been had the companies been combined during the periods presented.

 

     RSI
(Historical)
     dMY
(Historical)
     Pro Forma
Combined
(Assuming No
Redemptions)
     Pro Forma
Combined
(Assuming
Maximum
Redemptions)
 

As of and for the Nine Months Ended September 30, 2020

           

Book value per share

     N/A      $ 0.22      $ 5.97      $ 8.27  

Basic and diluted net loss per share — Class A

     N/A      $ 0.02      $ (0.48    $ (0.50

Basic and diluted weighted average shares outstanding — Class A

     N/A        23,000,000        43,580,189        22,331,250  

For the Twelve Months Ended December 31, 2019

     N/A           

Basic and diluted net loss per share — Class A

     N/A        N/A      $ (0.12    $ (0.12

Basic and diluted weighted average shares outstanding — Class A

     N/A        N/A        43,580,189        22,331,250  


 

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TICKER SYMBOLS AND DIVIDEND INFORMATION

dMY

Units, Common Stock and Warrants

Our Class A Common Stock and warrants are currently listed on the NYSE under the symbols “DMYT” and “DMYT WS,” respectively. Certain of our shares of Class A Common Stock and warrants currently trade as units consisting of one share of Class A Common Stock and one redeemable warrant, and are listed on the NYSE under the symbol “DMYT.U.” The units will automatically separate into their component securities upon consummation of the Business Combination and, as a result, will no longer trade as an independent security. Upon the Closing, we intend to change our name from “dMY Technology Group, Inc.” to “Rush Street Interactive, Inc.” We intend to apply to continue the listing of our Class A Common Stock and warrants on the NYSE under the symbols “RSI” and “RSI WS, respectively upon the Closing.

Holders

As of [•], 2020, there were [•] holders of record of our units, [•] holders of record of our Class A Common Stock and [•] holders of record of our warrants. The number of holders of record does not include a substantially greater number of “street name” holders or beneficial holders whose units, shares of Class A Common Stock and warrants are held of record by banks, brokers and other financial institutions.

Dividend Policy

dMY has not paid any cash dividends on its shares of common stock to date and does not intend to pay any cash dividends prior to the completion of the Business Combination. The payment of cash dividends in the future will be dependent upon the Company’s revenues and earnings, if any, capital requirements and general financial condition subsequent to completion of the Business Combination. The payment of any cash dividends subsequent to a Business Combination will be within the discretion of the Board at such time.



 

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RISK FACTORS

Stockholders should carefully consider the following risk factors, together with all of the other information included in this proxy statement, before they decide whether to vote or instruct their vote to be cast to approve the proposals described in this proxy statement. These risks could have a material adverse effect on the business, results of operations or financial condition of the Company and could adversely affect the trading price of our common stock.

First person pronouns used in this section, such as the words “we,” “our,” and “us,” refer to RSI.

Risks Relating to RSI

Risks Related to Our Business

Competition in the retail and online sports wagering and online gaming industry is intense and, as a result, we may fail to attract and retain users, which may negatively impact our operations and growth prospects.

The industries in which RSI operates are characterized by intense competition. We compete against other providers of retail or online sports gaming and retail or online casino gaming, as well as against providers of online and mobile entertainment and leisure products more generally. Other companies producing retail or online sports wagering or online gaming and/or interactive entertainment products and services are often established and well-financed, and other well-capitalized companies may introduce competitive services. Our competitors may spend more money and time on developing and testing products and services, undertake more extensive marketing campaigns, adopt more aggressive pricing or promotional policies or otherwise develop more commercially successful products or services than ours, which could negatively impact our business. Our competitors may also develop products, features, or services that are similar to ours or that achieve greater market acceptance. Such competitors may also undertake more far-reaching and successful product development efforts or marketing campaigns, or may adopt more aggressive pricing policies. Furthermore, in the future, new competitors, whether licensed or not, may enter the retail or online sports wagering or gaming industries. If we are not able to maintain or improve our market share, or if our offerings do not continue to be popular, our business, financial condition, results of operations and prospects could be adversely affected.

Competitive pressures may also adversely affect our margins. For example, as competition increases, we may need to lower our margins in order to attract customers. Further, as we expand to become a more national brand, we may need to increase our marketing expenses in order to compete.

RSI operates in the global entertainment and gaming industries within the broader entertainment industry with its business-to-consumer (“B2C”), business-to-business-to-consumer (“B2B2C”), business-to-business (“B2B”) offerings such as online casino wagering, online sports wagering, retail sports wagering and social gaming, and its B2B offerings through RSI’s proprietary online gaming platform and other services. Our users face a vast array of entertainment choices. Other forms of entertainment, such as television, movies, sporting events and in-person casinos, are more well established and may be perceived by our users to offer greater variety, affordability, interactivity and enjoyment. We compete with these other forms of entertainment for the discretionary time and income of our users. If we are unable to sustain sufficient interest in our online casino wagering, online sports wagering and social gaming platforms and our retail sports wagering services in comparison to other forms of entertainment, including new forms of entertainment, our business, financial condition, results of operations and prospects could be adversely affected.

In addition, our ability to achieve growth in revenue in the future will depend, in large part, upon our ability to attract new users to our offerings and retain existing users of our offerings, as well as continued user adoption of online casino and retail and online sports wagering more generally. Growth in the online casino and gaming industries and the level of demand for and market acceptance of our product offerings will be subject to a high degree of uncertainty. We cannot assure that consumer adoption of our product offerings will continue or exceed

 

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current growth rates, that the industry will achieve more widespread acceptance or that we will be able to retain our customers if we are unable to keep pace with technological innovation and customer experiences.

Sports leagues shortening, delaying or cancelling their seasons due to COVID-19 could adversely affect our business, financial condition, results of operations and prospects.

The recent outbreak of the novel coronavirus (“COVID-19”) has resulted in, among other things, suspension, shortening, delay, or cancellation of sports leagues. If the suspension, shortening, delay or cancellation of sporting events and sports leagues continues, we may not be able to accept wagers on such sporting events or sustain sufficient interest in our retail and online sports wagering platforms. Further, shortened seasons for sports leagues may result in a smaller amount of money wagered on sporting events throughout the course of each sport’s season. As a result, our business, financial condition, results of operations and prospects could be adversely affected.

Clear errors in the posting of sports wagering odds or event times have occurred occasionally, resulting in large liabilities. Though, to date, it has been general practice to void wagers associated with such clear errors or to correct the odds, it cannot be assured that in each and every case of such clear error regulators will continue the practice of approving the voiding of such clear errors.

RSI’s sports wagering products provide for the opportunity to wager across hundreds of sporting events. The odds for such events are set through a combination of algorithmic and manual odds-making, with bet acceptance also being a combination of automatic and manual acceptance. At times, the odds offered or the start times for the event posted on our website or app are incorrect. For example, such errors have consisted of inverted lines between teams, start times of games that, due to time zone differences, have already commenced or odds that are significantly different from the true odds of the outcome in a way that reasonable persons would agree is an error. Such errors have, in certain instances, resulted in large liabilities. When such errors occur, it is currently commonly accepted in nearly all jurisdictions for operators to void wagers associated with such clear errors. Further, in mature jurisdictions, wagers based upon clear error can be voided without need of prior regulatory approval. However, there can be no guarantee that this voiding of wagers practice will continue. If regulators were to not allow voiding of wagers associated with clear errors in odds making, RSI could be subject to covering significant liabilities associated with such errors.

Our projections, including for revenues, market share, expenses and profitability, are subject to significant risks, assumptions, estimates and uncertainties and may therefore differ materially from our expectations.

RSI operates in rapidly changing and competitive industries and our projections are subject to the risks and assumptions made by management with respect to our industries. Operating results are difficult to forecast because they generally depend on our assessment of the timing of adoption of future legislation and regulations by different states and countries, which are uncertain. Furthermore, if we invest in the development of new products or distribution channels that do not achieve significant commercial success, whether because of competition or otherwise, we may not recover the often substantial “up front” costs of developing and marketing those products and distribution channels, or recover the opportunity cost of diverting management and financial resources away from other products or distribution channels.

Additionally, as described above under “— Economic downturns and political and market conditions beyond our control, including reduction in consumer discretionary spending, could adversely affect our business, financial condition, results of operations and prospects,” our business may be affected by reductions in consumer spending from time to time as a result of a number of factors which may be difficult to predict. This may result in decreased revenue levels, and we may be unable to adopt measures in a timely manner to compensate for any unexpected shortfall in income. This inability could cause our operating results in a given quarter to be higher or lower than expected. If actual results differ from our estimates, analysts may negatively react and our stock price could be materially impacted.

 

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Our operating results may vary, which may make future results difficult to predict with certainty.

In the past, RSI’s financial results have varied on a quarter-by-quarter basis and may continue to do so in the future. This variance is due to a variety of factors certain of which are beyond our control. RSI’s financial results in any given quarter may be influenced by, among other things, consumer engagement and wagering results, and other factors which are outside of our control or we cannot predict.

Our financial results are dependent, in part, on continued consumer engagement. RSI consumer engagement in our sports wagering and online casino wagering services may vary or decrease, potentially resulting in a negative impact on our business, operations, financial condition or prospects, on account of, among other factors, the user’s level of satisfaction with our platforms, our ability to improve, innovate and adapt our platform, the number of sports events and the length of sporting seasons, outages and disruptions of online services, the offerings of our competitors, our marketing and advertising efforts, or declines in consumer activity generally as a result of economic downturns

Additionally, our quarterly financial results may also be impacted on the number and amount of operator losses and jackpot payouts we may experience. Though, operator losses are limited per stake to a maximum payout in our online casino wagering product offering, when looking at wagers across a period of time, these losses can potentially be significant. Our quarterly financial results are also subject to any jackpot payouts made in a particular quarter. As part of our online casino wagering offering, we offer progressive jackpot games. Each time a progressive jackpot game is played, a portion of the amount wagered by the user is contributed to the jackpot for that specific game or group of games. Once a jackpot is won, the progressive jackpot is paid out and is reset with a predetermined base amount. As winning of the jackpot is determined by a random mechanism, we cannot foresee when a jackpot will be won and we do not insure against jackpot payouts. Payment of the progressive jackpot decreases our cash position and depending upon the size of the jackpot may have a significant negative affect on our cash flow and financial condition.

The success, including win or hold rates, of existing or future online wagering products depends on a variety of factors and is not completely controlled by us.

The online casino wagering and retail and online sports wagering industries are characterized by an element of chance. Accordingly, RSI employs theoretical win rates to estimate what a certain type of online casino wager or retail or online sports wager, on average, will win or lose in the long run. Net win is impacted by variations in the hold percentage (the ratio of net winnings to total amount wagered) with respect to the online casino and retail and online sports wagering we offer to our users. RSI uses the hold percentage as an indicator of an online casino game or retail or online sports wager’s performance against its expected outcome. Although each online casino wager or retail or online sports wager generally performs within a defined statistical range of outcomes in the long run, actual outcomes may vary for any given period, particularly in the short term. In the short term, for online casino wagering and retail and online sports wagering, the element of chance may affect win rates (hold percentages); these win rates, particularly for retail and online sports wagering, may also be affected in the short term by factors that are largely beyond our control, such as unanticipated event outcomes, a user’s skill, experience and behavior, the mix of games played or wagers placed, the financial resources of users, the volume of wagers placed and the amount of time spent gambling. For online casino games, it is possible a random number generator outcome or game will malfunction and award errant prizes. For retail and online sports wagering, it is possible that our platform erroneously posts odds or is otherwise misprogrammed to pay out odds that are highly favorable to bettors, and bettors place wagers before the odds are corrected. Additionally, odds compilers and risk managers are capable of human error, so even if our wagering products are subject to a capped payout, significant volatility can occur. As a result of the variability in these factors, the actual win rates on our online casino games and retail and online sports wagers may differ from the theoretical win rates we have estimated and could result in the winnings of our online casino games or sports bet’s users exceeding those anticipated. The variability of win rates (hold rates) also has the potential to adversely affect our business, financial condition, results of operations, prospects and cash flows.

 

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Our success also depends in part on our ability to anticipate and satisfy user preferences in a timely manner. As we operate in a dynamic environment characterized by rapidly changing industry and legal standards, our products are subject to changing consumer preferences that cannot be predicted with certainty. We need to continually introduce new offerings and identify future product offerings that complement our existing platforms, respond to our users’ needs and improve and enhance our existing platforms to maintain or increase our user engagement and growth of our business. We may not be able to compete effectively unless our product selection keeps up with trends in the digital sports entertainment and gaming industries in which we compete, or trends in new gaming products.

If we fail to detect fraud or theft, including by our users and employees, our reputation may suffer which could harm our brand and reputation and negatively impact our business, financial condition, results of operations and prospects and can subject us to investigations and litigation.

We have in the past incurred, and may in the future incur, losses from various types of financial fraud, including use of stolen or fraudulent credit card data, claims of unauthorized payments by a user and attempted payments by users with insufficient funds. Bad actors use increasingly sophisticated methods to engage in illegal activities involving personal information, such as unauthorized use of another person’s identity, account information or payment information and unauthorized acquisition or use of credit or debit card details, bank account information and mobile phone numbers and accounts. Under current credit card practices, we may be liable for use of funds on our platform with fraudulent credit card data, even if the associated financial institution approved the credit card transaction.

Acts of fraud or other forms of cheating by our gaming customers may involve various tactics, including collusion with our employees and the exploitation of loopholes in our promotional bonus schemes. Successful exploitation of our systems could have negative effects on our product offerings, services and user experience and could harm our reputation. Additionally, we may inadvertently send overly generous promotional schemes that users or regulators force us to honor. Failure to discover such acts or schemes in a timely manner could result in harm to our operations. In addition, negative publicity related to such schemes could have an adverse effect on our reputation, potentially causing a material adverse effect on our business, financial condition, results of operations and prospects. In the event of the occurrence of any such issues with our existing platform or product offerings, substantial engineering and marketing resources and management attention, may be diverted from other projects to correct these issues, which may delay other projects and the achievement of our strategic objectives.

In addition, any misappropriation of, or access to, users’ or other proprietary information or other breach of our information security could result in legal claims or legal proceedings, including regulatory investigations and actions, or liability for failure to comply with privacy and information security laws, including for failure to protect personal information or for misusing personal information, which could disrupt our operations, force us to modify our business practices, damage our reputation and expose us to claims from our users, regulators, employees and other persons, any of which could have an adverse effect on our business, financial condition, results of operations and prospects.

Despite measures we have taken to detect and reduce the occurrence of fraudulent or other malicious activity on our platform, we cannot guarantee that any of our measures will be effective or will scale efficiently with our business. Our failure to adequately detect or prevent fraudulent transactions could harm our reputation or brand, result in litigation or regulatory action and lead to expenses that could adversely affect our business, financial condition, results of operations and prospects.

 

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We rely on strategic relationships with casinos in order to be able to offer our products in certain jurisdictions. If we cannot establish and manage relationships with casino partners, our business, financial condition, results of operations and prospects could be adversely affected.

Under some states’ wagering and gaming laws, online casino wagering, online sports wagering and retail sports wagering is limited to a finite number of retail operators, such as casinos, tribes or tracks, who own a “skin” or “skins” under that state’s law. A “skin” is a legally-authorized license from a state to offer sports wagering, online casino wagering or online gaming. The “skin” provides a market access opportunity for retail and online sports operators and online gaming operators to operate in the jurisdiction pending licensure and other required approvals by the state’s regulator. The entities that control those “skins’, and the numbers of “skins” available, are typically determined by a state’s wagering and gaming law. In most of the jurisdictions in which we offer online casino wagering and sports wagering, we currently rely on a casino, tribe or track in order to get a “skin.” These “skins” are what allows us to gain access to jurisdictions where sports wagering and online casino wagering operators are required to have a relationship with a land-based (“bricks-and-mortar”) gaming business. If we cannot establish, renew or manage our relationships with our bricks-and-mortar gaming partners, our relationships could terminate, and we would not be allowed to operate in those jurisdictions until we enter into new ones. As a result, our business, financial condition, results of operations and prospects could be adversely affected. Further, in certain of the states in which we operate where we are required to have a relationship with a bricks-and-mortar gaming business, customers who want to participate in online sports wagering or online gaming must sign-up for an online account at our retail location within the casino facility of our bricks-and-mortar gaming business partners. Certain of these casino facilities were closed by government order for a time in response to the COVID-19 pandemic. Though certain of these facilities have re-opened, if they were to be closed again due to the ongoing COVID-19 response, our ability to register new online customers from these states could be negatively impacted. On the other hand, the re-opening of these facilities could slow the growth of our online offerings as consumers will have the ability to spend time and money at land-based facilities instead of with our online offerings.

RSI’s current and projected performance relies upon continued compatibility between the RSI app and the major mobile operating systems, third party platforms continuing to allow distribution of our product offerings, high-bandwidth data capabilities and the interoperability of our platforms with widely used mobile operating systems. Disruptions in the availability of these may negatively impact our business, financial conditions, results of operations and prospects.

Our users primarily access our online sports wagering and online casino wagering product offerings through the RSI app on their mobile devices, and we believe that this will continue to be the case going forward. To provide our users our product offerings through our app on their mobile devices, our app must be compatible with major mobile operating systems. Our app relies upon third party platforms to distribute our product offerings, interoperability of our platforms with popular mobile operating systems, technologies, networks and standards and continued high-bandwidth data capabilities. Third parties with whom RSI does not have any formal relationships control the design of mobile devices and operating systems. These parties frequently introduce new devices, and from time to time they may introduce new operating systems or modify existing ones. Network carriers may also impact the ability to download apps or access specified content on mobile devices. Further, RSI relies upon third-party platforms for distribution of its product offerings. RSI’s online sports wagering and online casino wagering product offerings are primarily distributed through a traditional website and the Apple App Store and may in the future be offered through The Google Play store. In light of this, the promotion, distribution, and operation of the RSI’s app are subject to the respective distribution platforms’ standard terms and policies for application developers, which are very broad and subject to frequent changes and interpretation and may not be uniformly enforced across all applications and with all publishers.

Moreover, RSI is, and will continue to be, dependent on the interoperability of our platforms with popular mobile operating systems, technologies, networks, and standards that we do not control, such as the Android and iOS operating systems. Any changes, bugs, technical, or regulatory issues in such systems, our relationships with

 

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mobile manufacturers and carriers, or in their terms of service or policies that negatively affect our offerings’ functionality, reduce or eliminate our ability to distribute our offerings, provide preferential treatment to competitive products, limit our ability to deliver our offerings, or impose fees or other charges related to delivering our offerings, could adversely affect our product usage and monetization on mobile devices.

In addition, RSI’s products require high-bandwidth data capabilities for placement of time-sensitive wagers. If high-bandwidth capabilities do not continue to grow or grow more slowly than generally anticipated, particularly for mobile devices, our user growth, retention, and engagement may be negatively impacted. To deliver high-quality content over mobile cellular networks, RSI’s product offerings also must work well with a range of mobile technologies, systems, networks, regulations, and standards that RSI does not control. In particular, any future changes to the iOS or Android operating systems (which likely will occur) may impact the accessibility, speed, functionality, and other performance aspects of our platforms. In addition, the adoption of any laws or regulations that adversely affect the growth, popularity, or use of the Internet, including laws governing Internet neutrality, could decrease the demand for our products and increase our cost of doing business. Specifically, any laws that would allow mobile providers in the United States to impede access to content, or otherwise discriminate against content providers like us over their data networks, could have a material adverse effect on our business, financial condition, results of operations, and prospects.

Furthermore, if it becomes more difficult for our users to access and use our platform on their mobile devices, if our users choose not to access or use our platform on their mobile devices, or if our users choose to use mobile products that do not offer access to our platform, our user growth, retention, and engagement could be materially harmed. Additionally, if any of the third-party platforms used for distribution of our product offerings were to limit or disallow advertising on their platforms for whatever reason or technologies are developed that block the display of our ads, our ability to generate revenue could be negatively impacted. These changes could materially impact our business activities and practices, and if we or our advertising partners are unable to timely and effectively adjust to those changes, there could be an adverse effect on our business, financial condition, results of operations, and prospects.

Our growth prospects may suffer if we are unable to develop successful offerings or if we fail to pursue additional offerings. In addition, if we fail to make the right investment decisions in our offerings and technology platform, we may not attract and retain key users and our revenue and results of operations may decline.

RSI was founded in 2012 and has primarily focused its efforts in the last eight years on growing its current product offerings. RSI has rapidly expanded, and we anticipate expanding further as new product offerings mature and as we pursue our growth strategies. The industries in which we operate are characterized by rapid technological change, evolving industry standards, frequent new product offering introductions and changes in customer demands, expectations and regulations. To keep pace with the technological developments, achieve product acceptance and remain relevant to users, we will need to continue developing new and upgraded functionality of our products and services and adapt to new business environments and competing technologies and products developed by our competitors. The process of developing new technology is complex, costly and uncertain. To the extent we are not able to adapt to new technologies and/or standards, experience delays in implementing adaptive measures or fail to accurately predict emerging technological trends and the changing needs of users, we may lose customers.

The requirements of being a public company may strain our resources and divert management’s attention, and the increases in legal, accounting and compliance expenses that will result from the Business Combination may be greater than we anticipate.

As a result of the Business Combination, RSI will become a public company, and as such (and particularly after we are no longer an “emerging growth company”), we will incur significant legal, accounting and other expenses that we did not incur as a private company. We will be subject to the reporting requirements of the

 

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Exchange Act, and will be required to comply with the applicable requirements of the Sarbanes-Oxley Act and the Dodd-Frank Wall Street Reform and Consumer Protection Act, as well as the rules and regulations subsequently implemented by the SEC and the listing standards of the NYSE, including changes in corporate governance practices and the establishment and maintenance of effective disclosure and financial controls. Compliance with these rules and regulations can be burdensome. Our management and other personnel will need to devote a substantial amount of time to these compliance initiatives. Moreover, these rules and regulations will increase RSI’s historical legal and financial compliance costs and will make some activities more time-consuming and costly. For example, we expect that these rules and regulations may make it more difficult and more expensive for us to obtain director and officer liability insurance than RSI obtained as private companies, and could also make it more difficult for us to attract and retain qualified members of our Board as compared to RSI as a private company. In particular, we expect to incur significant expenses and devote substantial management effort toward ensuring compliance with the requirements of Section 404 of the Sarbanes-Oxley Act, which will increase when we are no longer an “emerging growth company.” We may need to hire additional accounting and financial staff, and engage outside consultants, all with appropriate public company experience and technical accounting knowledge and maintain an internal audit function, which will increase our operating expenses. Moreover, we could incur additional compensation costs in the event that we decide to pay cash compensation closer to that of other public companies, which would increase our general and administrative expenses and could materially and adversely affect our profitability. We are evaluating these rules and regulations, and cannot predict or estimate the amount of additional costs we may incur or the timing of such costs.

As a private company, RSI has not been subject to the SEC’s requirements regarding its internal controls over financial reporting. Our failure to maintain adequate financial, information technology and management processes and controls has resulted in and could result in material weaknesses that could lead to errors in our financial reporting, which in turn could adversely affect our business.

RSI has not been required to document and test its internal controls over financial reporting, its management has not been required to certify the effectiveness of its internal controls and its auditors have not been required to opine on the effectiveness of its internal control over financial reporting. Similarly, as an “emerging growth company,” dMY has been exempt from the SEC’s internal control reporting requirements. RSI may lose its emerging growth company status and become subject to the SEC’s internal control over financial reporting management and auditor attestation requirements in the year in which it is deemed to be a large accelerated filer, which would occur once it is subject to Exchange Act reporting requirements for 12 months, has filed at least one SEC annual report and the market value of its common equity held by non-affiliates exceeds $700 million as of the end of the prior fiscal year’s second fiscal quarter. RSI may not be able to complete its evaluation, testing and any required remediation in a timely fashion.

In connection with the audit of RSI’s consolidated financial statements as of December 31, 2019 and 2018, RSI and its independent registered public accounting firm identified one “material weakness” in our internal control over financial reporting and other control deficiencies. As defined in standards established by the U.S. Public Company Accounting Oversight Board (“PCAOB”), a “material weakness” is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the company’s annual or interim financial statements will not be prevented or detected and corrected on a timely basis. The material weakness identified related to our difficulty preparing our consolidated financial statements on an accurate and timely basis, and how our lack of accounting department personnel mitigates the ability to have proper review controls over estimates and contractual transactions and detailed monthly reviews. Following the identification of the material weakness and other control deficiencies, we plan to take measures to remedy these deficiencies. However, the implementation of any measures may not fully address the material weakness and deficiencies in our internal control over financial reporting.

In addition, RSI’s current controls and any new controls that it develops may become inadequate because of design-related issues and changes in its business, including increased complexity resulting from any international expansion. Any failure to implement and maintain effective internal controls over financial reporting could

 

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adversely affect the results of assessments by its independent registered public accounting firm and their attestation reports. If RSI is unable to certify the effectiveness of its internal controls or remedy the identified material weakness, or if RSI’s internal controls have any additional material weaknesses, RSI may not detect errors timely, its consolidated financial statements could be misstated, and it could be subject to regulatory scrutiny and a loss of confidence by stakeholders, which could harm RSI’s business and adversely affect the market price of RSI common stock.

Recruitment and retention of our employees, including certain key employees, is vital to growing our business and meeting our business plans. The loss of any of our key executives or other key employees could harm our business.

We depend on a limited number of key personnel to manage and operate our business, including RSG’s co-founders and our Chief Executive Officer. The leadership of the current executive officers of RSI has been a critical element of RSI’s success and the departure, death or disability of any one of our executive officers or other extended or permanent loss of any of their services, or any negative market or industry perception with respect to any of them or their loss, could have a material adverse effect on our business. We cannot provide assurance that we will be able to attract or retain such highly qualified personnel in the future. In addition, the loss of employees or the inability to hire necessary skilled employees could result in significant disruptions to our business, and the integration of replacement personnel could be time-consuming and expensive and cause additional disruptions to our business. Additionally, our Chief Executive Officer will continue to be employed by RSG, and his time and attention may be diverted from RSI’s business, which may have an impact on our business. If we do not succeed in attracting, hiring, and integrating excellent personnel, or retaining and motivating existing personnel, we may be unable to grow effectively and our business, financial condition, results of operations and prospects could be adversely affected.

Due to the nature of our business, we are subject to taxation in a number of jurisdictions and changes in, or new interpretation of, tax laws, tax rulings or their application by tax authorities could result in additional tax liabilities and could materially affect our business, financial condition, results of operations and prospects.

Our tax obligations are varied and include United States federal, state and international taxes due to the nature of the RSI business. The tax laws that are applicable to our business are subject to interpretation, and significant judgment is required in determining our worldwide provision for income taxes. In the course of our business, there will be many transactions and calculations where the ultimate tax determination is uncertain. For example, compliance with the 2017 United States Tax Cuts and Jobs Act (“TCJA”) may require the collection of information not regularly produced within our Company, the use of estimates in our consolidated financial statements, and the exercise of significant judgment in accounting for its provisions. As regulations and guidance evolve with respect to the TCJA, and as we gather more information and perform more analysis, our results may differ from previous estimates and may materially affect our consolidated financial statements.

The gaming industry represents a significant source of tax revenue to the jurisdictions in which we operate. Gaming companies and B2B providers in the gaming industry (directly and/or indirectly by way of their commercial relationships with operators) are currently subject to significant taxes and fees in addition to normal corporate income taxes, and such taxes and fees are subject to increase at any time. From time to time, various legislators and other government officials have proposed and adopted changes in tax laws, or in the administration or interpretation of such laws, affecting the gaming industry. In addition, any worsening of economic conditions and the large number of jurisdictions with significant current or projected budget deficits could intensify the efforts of governments to raise revenues through increases in gaming taxes and/or other taxes. It is not possible to determine with certainty the likelihood of changes in tax laws or in the administration or interpretation or enforcement of such laws. Any material increase, or the adoption of additional taxes or fees, could have a material adverse effect on our business, financial condition, results of operations and prospects.

Additionally, tax authorities may impose indirect taxes on Internet-related commercial activity based on existing statutes and regulations which, in some cases, were established prior to the advent of the Internet. Tax

 

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authorities may interpret laws originally enacted for mature industries and apply it to newer industries, such as RSI. The application of such laws may be inconsistent from jurisdiction to jurisdiction. Our in-jurisdiction activities may vary from period to period which could result in differences in nexus from period to period.

We are subject to periodic review and audit by domestic and foreign tax authorities. Tax authorities may disagree with certain positions RSI has taken or that we will take, and any adverse outcome of such a review or audit could have a negative effect on our business, financial condition, results of operations and prospects. Although we believe that our tax provisions, positions and estimates are reasonable and appropriate, tax authorities may disagree with certain positions we have taken. In addition, economic and political pressures to increase tax revenue in various jurisdictions may make resolving tax disputes favorably more difficult.

We have business operations located in Colombia, outside of the United States, which subjects us to additional costs and risks that could adversely affect our operating results.

A portion of our operations are located in Colombia, and, we may in the future pursue opportunities in other non-United States jurisdictions. Compliance with international, Colombian and United States laws and regulations that apply to our international operations increases our cost of doing business. As a result of our international operations, we are subject to a variety of risks and challenges in managing an organization operating in various countries, including those related to:

 

   

challenges caused by distance as well as language and cultural differences;

 

   

general economic conditions in Colombia (and any other jurisdictions where we may pursue non- United States opportunities);

 

   

regulatory changes;

 

   

political unrest, terrorism and the potential for other hostilities;

 

   

public health risks, particularly in areas in which we have significant operations;

 

   

longer payment cycles and difficulties in collecting accounts receivable;

 

   

overlapping or changes in tax regimes;

 

   

difficulties in transferring funds from certain countries;

 

   

laws such as the United States Foreign Corrupt Practices Act, and local laws which also prohibit corrupt payments to governmental officials;

 

   

local laws which prohibit money-laundering and financing of terrorist and other unlawful financial activities; and

 

   

reduced protection for intellectual property rights in some countries.

If we are unable to expand or adequately staff and manage our existing development operations located outside of the United States, we may not realize, in whole or in part, the anticipated benefits from these initiatives (including lower development expenses), which in turn could materially adversely affect our business, financial condition, results of operations and prospects.

Following the consummation of the Business Combination, we will be dependent on RSG and certain of its affiliates to provide us with certain services, which may not be sufficient to meet our needs, and we may have difficulty finding replacement services or be required to pay increased costs to replace these services to the extent that our services agreement with RSG terminates.

Historically, RSG has provided, and following the consummation of the Business Combination will continue to provide, certain corporate and shared services related to corporate functions such as executive

 

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oversight, risk management, information technology, accounting, audit, legal, investor relations, human resources, tax, treasury, procurement and other services. RSI reimburses RSG for all third party costs it incurs in providing services to RSI at cost (with no mark-up) and reimburses RSG for an allocable portion of payroll, benefits and overhead (calculated at 150% of an employee’s salary, bonus and benefits cost) with respect to RSG employees who perform or otherwise assist with the provision of services to RSI. Following the consummation of the Business Combination, RSG will continue to provide many of these services under a services agreement between RSI and RSG. While these services are being provided to us by RSG, we will be dependent on RSG for services that are critical to our operation as a publicly traded company, and our operational flexibility to modify or implement changes with respect to such services and the amounts we pay for them will be limited. Should the services agreement with RSG terminate, we may not be able to replace these services or enter into appropriate third-party agreements on terms and conditions, including cost and quality of service, comparable to those that we will receive from RSG under the services agreement. Although we may in the future choose to replace portions of the services that will be provided by RSG following the consummation of the Business Combination, we may encounter difficulties replacing certain services or be unable to negotiate pricing or other terms as favorable as those we currently have in effect.

Negative publicity of us or an adverse shift in public opinion regarding sports wagering or online casino wagering may adversely impact our business and user retention.

A negative change in the public’s opinion of sports wagering or online sports wagering, or how politicians and other governmental authorities view sports wagering or online casino wagering could result in future legislation or new regulations restricting or prohibiting certain (or all) sports wagering or online casino wagering activities in certain jurisdiction, the result of which may negatively impact our business, financial condition, results of operations and prospects. Further, negative publicity of us or our product offerings, platform or user experience or the sports wagering and online casino wagering industry generally could lead to new restrictions and limitations on us or sports wagering and online casino wagering generally, which may have a negative impact on our business, financial condition, results of operations and prospects.

Risks Related to Government Regulation

Our business is subject to a variety of United States and foreign laws, many of which are unsettled and still developing. Any change in regulations or their interpretation, or the regulatory climate applicable to our products and services, or changes in tax rules and regulations or interpretation thereof related to our products and services, could adversely impact our ability to operate our business, which could have a material adverse effect on our business, financial condition, results of operations and prospects.

We are subject to laws and regulations relating to real-money online casino wagering and retail and online sports wagering in the jurisdictions in which we conduct our business or in some circumstances, of those jurisdictions in which we offer our product offerings. We are also subject to the general laws and regulations that apply to all e-commerce businesses, such as those related to privacy and personal information, tax and consumer protection. These laws and regulations vary from one jurisdiction to another and future legislative and regulatory action, court decisions or other governmental action, which may be affected by, among other things, political pressures, attitudes and climates, as well as personal biases, may have a material impact on our operations and financial results. In particular, some jurisdictions have introduced regulations attempting to restrict or prohibit online gaming, while others have taken the position that online gaming should be licensed and regulated and have adopted or are in the process of considering legislation and regulations to enable that to happen. Additionally some jurisdictions in which we may operate could presently be unregulated or partially regulated and therefore more susceptible to the enactment or change of laws and regulations.

RSI offers its products in seven states that have adopted legislation and regulations permitting online casino wagering, online sports wagering or retail sports wagering. In those states that currently require a license or registration, RSI has either obtained the appropriate license or registration or has obtained a provisional license. RSI also has one foreign license and operates under that license.

 

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In May 2018, the United States Supreme Court struck down as unconstitutional the Professional and Amateur Sports Protection Act of 1992 (“PASPA”). This decision has the effect of lifting federal restrictions on sports wagering and thus allows states to determine by themselves the legality of sports wagering. Since the repeal of PASPA, several states (plus Washington D.C.) have legalized online sports wagering. To the extent new real money online casino wagering or retail or sports wagering jurisdictions are established or expanded, we cannot guarantee that we will be successful in penetrating such new jurisdictions or expanding our business or user base in line with the growth of existing jurisdictions. If we are unable to effectively develop and operate directly or indirectly within these new jurisdictions or if our competitors are able to successfully penetrate geographic jurisdictions that we cannot access or where we face other restrictions, there could be a material adverse effect on our business, financial condition, results of operations and prospects. Our failure to obtain or maintain the necessary regulatory approvals in jurisdictions, whether individually or collectively, would have a material adverse effect on our business. See “Business of RSI — Risks Relating to Government Regulation.” To expand into new jurisdictions, we may need to be licensed and obtain approvals of our product offerings. This is a time-consuming process that can be extremely costly. Any delays in obtaining or difficulty in maintaining regulatory approvals needed for expansion within existing jurisdictions or into new jurisdictions can negatively affect our opportunities for growth, including the growth of our customer base, or delay our ability to recognize revenue from our offerings in any such jurisdictions.

Future legislative and regulatory action, and court decisions or other governmental action, may have a material impact on our operations and financial results. Governmental authorities could view us as having violated local laws, despite our efforts to obtain all applicable licenses or approvals. Further, there is risk that governmental authorities or courts could determine that our free-play, social casino offerings constitute unauthorized gambling or that legislation is enacted in jurisdictions in which we operate free-play, social casino offerings that makes our free-play, social casino offerings unauthorized gambling, which could negatively impact our operations and business results. There is also a risk that civil and criminal proceedings, including class actions brought by or on behalf of prosecutors or public entities or incumbent monopoly providers, or private individuals, could be initiated against us, Internet service providers, credit card and other payment processors, advertisers and others involved in the online casino and gaming industries. Such potential proceedings could involve substantial litigation expense, penalties, fines, seizure of assets, injunctions or other restrictions being imposed upon us or our licensees or other business partners, while diverting the attention of key executives. Such proceedings could have a material adverse effect on our business, financial condition, results of operations and prospects, as well as impact our reputation.

There can be no assurance that legally enforceable legislation will not be proposed and passed in jurisdictions relevant or potentially relevant to our business to prohibit, legislate or regulate various aspects of the online casino and retail and online gaming industries (or that existing laws in those jurisdictions will not be interpreted negatively). Compliance with any such legislation may have a material adverse effect on our business, financial condition, results of operations and prospects, either as a result of our determination that a jurisdiction should be blocked, or because a local license or approval may be costly for us or our business partners to obtain and/or such licenses or approvals may contain other commercially undesirable conditions.

In the United States, the Unlawful Internet Gambling Enforcement Act of 2006 (“UIGEA”) prohibits among other things, the acceptance by a business of a wager by means of the Internet where such wager is prohibited by any federal or state law where initiated, received or otherwise made. Under UIGEA severe criminal and civil sanctions may be imposed on the owners and operators of such systems and on financial institutions that process wagering transactions. The law contains a safe harbor for wagers placed within a single state (disregarding intermediate routing of the transmission) where the method of placing the wager and receiving the wager is authorized by that state’s law, provided the underlying regulations establish appropriate age and location verification.

The Illegal Gambling Business Act (“IGBA”), makes it a crime to conduct, finance, manage, supervise, direct or own all or part of an “illegal gambling business” and the Travel Act makes it a crime to use the mail or

 

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any facility in interstate commerce with the intent to “distribute the proceeds of any unlawful activity,” or “otherwise promote, manage, establish, carry on, or facilitate the promotion, management, establishment, or carrying on, of any unlawful activity.” For there to be a violation of either the IGBA or the Travel Act there must be a violation of underlying state law.

Until 2011, there was uncertainty as to whether the Federal Wire Act of 1961 (the “Wire Act”) prohibited states from conducting intrastate lottery transactions via the Internet if such transactions crossed state lines. In late 2011, the Office of Legal Counsel (the “OLC”) of the Department of Justice (“DOJ”) issued an opinion which concluded that the prohibitions of the Wire Act were limited to sports gambling and thus did not apply to state lotteries at all (the “2011 DOJ opinion”). Following the issuance of the 2011 DOJ opinion, within the past few years, state-authorized Internet casino gaming has been launched in Delaware, New Jersey and Pennsylvania and has been approved in Michigan and state authorized online poker has been launched in Nevada. In 2018, at the request of the Criminal Division, the OLC reconsidered the 2011 DOJ opinion’s conclusion that the Wire Act was limited to sports gambling. On January 14, 2019, the OLC published a legal opinion dated November 2, 2018 (the “2018 DOJ opinion”), which concluded that the 2011 DOJ opinion had incorrectly interpreted the Wire Act. In the 2018 DOJ opinion, the OLC concluded that the restrictions on the transmission in interstate or foreign commerce of bets and wagers in the Wire Act were not limited to sports gambling but instead applied to all bets and wagers. The OLC also found that the enactment of the UIGEA described above did not modify the scope of the Wire Act. The OLC acknowledged that its conclusion in the 2018 DOJ opinion, which was contrary to the 2011 DOJ opinion, will make it more likely that the executive branch’s view of the law will be tested in the courts. At this time, we are unable to determine whether the 2018 DOJ opinion will be upheld by the courts, or what impact it will have on us or our customers.

Our growth prospects depend on the legal status of real-money gaming in various jurisdictions, and legalization may not occur in as many states as we expect, or may occur at a slower pace than we anticipate or may be accompanied by legislative or regulatory restrictions or taxes that make it impracticable or less attractive to operate, which could adversely affect our future results of operations and make it more difficult to meet our expectations for financial performance.

A number of states have legalized, or are currently considering legalizing, real money gaming, and our growth, business, financial condition, results of operations and prospects are significantly dependent upon the legalization of real money gaming expanding to new jurisdictions. Our business plan is partially based upon real money gaming becoming legal for a specific percent of the population on a yearly basis; however, this legalization may not occur as we have anticipated. Additionally, if a large number of additional states or the federal government enact real money gaming legislation and we are unable to obtain, or are otherwise delayed in obtaining the necessary licenses to operate online sports wagering or online gaming websites in United States jurisdictions where such games are legalized, our future growth in online sports wagering and online gaming could be materially impaired.

As we enter into new jurisdictions, states or the federal government may legalize real money gaming in a manner that is unfavorable to us. As a result, we may encounter legal, regulatory and political challenges that are difficult or impossible to foresee and which could result in an unforeseen adverse impact on planned revenues or costs associated with the new opportunity. For example, certain states require us to have a relationship with a bricks-and-mortar, licensed casino for online sportsbook or online gaming access, which tends to increase our costs of revenue. States that have established state-run monopolies may limit opportunities for private sector participants like us. States also impose substantial tax rates on online sports wagering and online gaming revenue, in addition to sales taxes in certain jurisdictions and a federal excise tax of 25 basis points on the amount of each wager. As most state product taxes apply to various measures of modified gross profit, tax rates, whether federal- or state-based, that are higher than we expect will make it more costly and less desirable for us to launch in a given jurisdiction, while tax increases in any of our existing jurisdictions may adversely impact our profitability.

 

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Therefore, even in cases in which a jurisdiction purports to license and regulate online sports wagering and online gaming, the licensing and regulatory regimes can vary considerably in terms of their business-friendliness and at times may be intended to provide incumbent operators with advantages over new licensees. Therefore, some “liberalized” regulatory regimes are considerably more commercially attractive than others.

Failure to comply with regulatory requirements or to successfully obtain a license or permit applied for could adversely impact our ability to comply with licensing and regulatory requirements or to obtain or maintain licenses in other jurisdictions, or could cause financial institutions, online and mobile platforms and distributors to stop providing services to us.

Compliance with the various regulations applicable to real money wagering is costly and time-consuming. Regulatory authorities at the non-United States, United States federal, state and local levels have broad powers with respect to the regulation and licensing of real money gaming operations and may revoke, suspend, condition or limit our real money gaming licenses, impose substantial fines on us and take other actions, any one of which could have a material adverse effect on our business, financial condition, results of operations and prospects. These laws and regulations are dynamic and subject to potentially differing interpretations, and various legislative and regulatory bodies may expand current laws or regulations or enact new laws and regulations regarding these matters. We will strive to comply with all applicable laws and regulations relating to our business. It is possible, however, that these requirements may be interpreted and applied in a manner that is inconsistent from one jurisdiction to another and may conflict with other rules. Non-compliance with any such law or regulations could expose us to claims, proceedings, litigation and investigations by private parties and regulatory authorities, as well as substantial fines and negative publicity, each of which may materially and adversely affect our business, financial condition, results of operations and prospects.

Any real money gaming license could be revoked, suspended or conditioned at any time. The loss of a license in one jurisdiction could trigger the loss of a license or affect our eligibility for such a license in another jurisdiction, and any of such losses, or potential for such loss, could cause us to cease offering some or all of our offerings in the impacted jurisdictions. We may be unable to obtain or maintain all necessary registrations, licenses, permits or approvals, and could incur fines or experience delays related to the licensing process, which could adversely affect our operations. Our delay or failure to obtain or maintain licenses in any jurisdiction may prevent us from distributing our offerings, increasing our customer base and/or generating revenues. We cannot assure you that we will be able to obtain and maintain the licenses and related approvals necessary to conduct our online casino and retail and online sports wagering operations. Any failure to maintain or renew our existing licenses, registrations, permits or approvals could have a material adverse effect on our business, financial condition, results of operations and prospects.

Additionally, a gaming regulatory body may refuse to issue or renew a gaming license or restrict or condition the same, based on the past or present activities of RSI or our current or former directors, officers, employees, shareholders or third parties with whom we have relationships, which could adversely affect our business, financial condition, results of operations and prospects. If additional gaming regulations are adopted in a jurisdiction in which we operate, such regulations could impose restrictions or costs that could have a significant adverse effect on us. From time to time, various proposals are introduced in the legislatures of some of the jurisdictions in which we have existing or planned operations that, if enacted, could adversely affect our directors, officers, key employees, or other aspects of the company’s operations. To date, we have obtained all governmental licenses, findings of suitability, registrations, permits and approvals necessary for our operations. However, we can give no assurance that any additional licenses, permits and approvals that may be required will be given or that existing ones will be renewed or will not be revoked. Renewal is subject to, among other things, continued satisfaction of suitability requirements of our directors, officers, key employees and shareholders. Any failure to renew or maintain our licenses or to receive new licenses when necessary would have a material adverse effect on our business, financial condition, results of operations and prospects.

 

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RSI follows the industry practice of restricting and managing wagering limits at the individual customer level based on individual customer profiles and risk level to the enterprise; however there is no guarantee that states will allow operators such as RSI to limit on the individual customer level.

Similar to a credit card company managing individual risk on the customer level through credit limits, it is customary for retail and online sports wagering operators to manage customer wagering limits at the individual level to manage enterprise risk levels. RSI believes this practice is beneficial overall, because if it were not possible, the wagering options would be restricted globally and limits available to customers would be much lower to insulate overall risk due to the existence of a very small segment of highly sophisticated syndicates and algorithmic bettors, or bettors looking to take advantage of site errors and omissions. We believe virtually all operators balance taking reasonable action from all customers against the risk of individual customers significantly harming the business viability. We cannot assure you that all state legislation and regulators will always allow operators to execute limits at the individual customer level, or at their sole discretion.

In some jurisdictions, our key executives, certain employees or other individuals related to the business will be subject to licensing or compliance requirements. Failure by such individuals to obtain the necessary licenses or comply with individual regulatory obligations could cause the business to be non-compliant with its obligations, or imperil its ability to obtain or maintain licenses necessary for the conduct of the business.

As part of obtaining real money gaming licenses, the responsible gaming authority will generally determine suitability of certain directors, officers and employees and, in some instances, significant shareholders. The criteria used by gaming authorities to make determinations as to who requires a finding of suitability or the suitability of an applicant to conduct gaming operations varies among jurisdictions, but generally requires extensive and detailed application disclosures followed by a thorough investigation. Gaming authorities typically have broad discretion in determining whether an applicant should be found suitable to conduct operations within a given jurisdiction. If any gaming authority with jurisdiction over our business were to find an applicable officer, director, employee or significant shareholder of ours unsuitable for licensing or unsuitable to continue having a relationship with us, we would be required to sever our relationship with that person. Furthermore, such gaming authorities may require us to terminate the employment of any person who refuses to file required applications. Either result could have a material adverse effect on our business, financial condition, results of operations and prospects.

The Proposed Charter will include provisions that may require stockholders to sell their securities if the stockholder is deemed to be “unsuitable” for purposes of certain gaming regulations.

The Proposed Charter provides that any equity interests of RSI owned or controlled by an unsuitable person or its affiliates will be subject to mandatory sale and transfer to either RSI or one or more third party transferees and in such number and class(es)/series of equity interests as determined by the Board in good faith (following consultation with reputable outside and independent gaming regulatory counsel) pursuant to a resolution adopted by a majority of the directors of the Board.

RSI’s gaming activities are regulated by gaming authorities in each jurisdiction in which RSI operates. To operate in any given gaming jurisdiction, RSI and its directors, officers, certain other key employees and, in certain cases, its significant shareholders, must be found suitable by the relevant gaming authority. Gaming authorities typically have broad discretion in determining whether an applicant is suitable to conduct or be associated with gaming activities within a given jurisdiction. Though criteria for suitability varies by jurisdiction, such criteria generally include (among other things) an evaluation of the applicant’s reputation for good character, criminal and financial history and character of those with whom the applicant associates. RSI’s association with individuals or entities that are or are likely to be deemed unsuitable in any particular jurisdiction would present risk to RSI’s ability to obtain or maintain the gaming license it needs to operate in such jurisdiction. Suspension or revocation of any existing license or rejection of any application for a new license made by RSI is likely to have a material negative affect on RSI’s business, operations and prospects. As such, to

 

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avoid potential material adverse effect on RSI’s business, operations and prospects, if a director, officer, key employee or shareholder of RSI is found or deemed unsuitable (including if such individual refuses to file required applications) or if RSI’s association with such individual would risk its license status (as determined by the Board following consultation with reputable outside and independent gaming regulatory counsel), RSI would need to sever its relationship with such individual, including by requiring a sale of the equity interests such individual holds in RSI to RSI or other third party.

Risks Related to Intellectual Property and Data Security

We intend to license certain trademarks and domain names to RSG and its affiliates, and RSG’s and its affiliates’ use of such trademarks and domain names may harm our business.

We intend to enter into a license agreement (the “License Agreement”), with RSG (the “Licensee”), pursuant to which we expect to grant to Licensee and its affiliates a perpetual, royalty-free, license to use, in certain fields of use, certain trademarks and domain names that will be assigned to us by the Licensee and certain of its affiliates in connection with the Business Combination. This license may be either exclusive or non-exclusive based on the field of use and the particular trademark or domain name. This license will preclude our use of certain trademarks and domain names in the exclusive fields of use. Certain trademarks and domain names that we license to Licensee may include the words “Rush Street,” and Licensee’s use of such trademarks and domain names may disrupt our reputation in the marketplace, damage any goodwill we may have generated, and otherwise harm our business, financial condition, results of operations and prospects.

We rely on information technology and other systems and platforms, and failures, errors, defects or disruptions therein could diminish our brand and reputation, subject us to liability, disrupt our business, affect our ability to scale our technical infrastructure and adversely affect our operating results and growth prospects. Our product offerings and other software applications and systems, and certain third-party platforms that we use could contain undetected errors.

Our technology infrastructure is critical to the performance of our platform and product offerings and to user satisfaction. We devote significant resources to network and data security to protect our systems and data. However, our systems may not be adequately designed with the necessary reliability and redundancy to avoid performance delays or outages that could be harmful to our business. We cannot assure you that absolute security will be provided by the measures we take to: prevent or hinder cyber-attacks and protect our systems, data and user information; to prevent outages, data or information loss, and fraud; and to prevent or detect security breaches. Such measures include a disaster recovery strategy for server and equipment failure, back-office systems and the use of third parties for certain cybersecurity services. RSI has experienced, and we may in the future experience, website disruptions, outages and other performance problems due to a variety of factors, including infrastructure changes, human or software errors and capacity constraints. To date, such disruptions have not had a material impact on RSI, individually or in the aggregate; however, future disruptions from unauthorized access to, fraudulent manipulation of, or tampering with our computer systems and technological infrastructure, or those of third parties, could result in a wide range of negative outcomes, each of which could materially adversely affect our business, financial condition, results of operations and prospects.

Additionally, our product offerings may contain errors, bugs, flaws or corrupted data, and these defects may become apparent only after their launch and could result in a vulnerability that could compromise the security of our systems. If a particular product offering is unavailable when users attempt to access it or navigation through our platforms is slower than they expect, users may be unable to use our product offerings as desired and may be less likely to return to our platforms as often, if at all. Furthermore, programming errors, defects and data corruption could disrupt our operations, adversely affect the experience of our users, harm our reputation, cause our users to stop utilizing our platforms, divert our resources or delay market acceptance of our product offerings, any of which could result in legal liability to us or harm our business, financial condition, results of operations and prospects. Insufficient business continuity management could diminish our brand and reputation,

 

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subject us to liability, disrupt our business and adversely affect our operating results and growth prospects, and failure of planned availability and continuity solutions and disaster recovery when activated in response to an incident could result in system interruptions and degradation of service.

If our user base and engagement continue to grow, and the amount and types of product offerings continue to grow and evolve, we will need an increasing amount of technical infrastructure, including network capacity and computing power, to continue to satisfy our users’ needs. Such infrastructure expansion may be complex, and unanticipated delays in completing these projects or availability of components may lead to increased project costs, operational inefficiencies, or interruptions in the delivery or degradation of the quality of our product offerings. In addition, there may be issues related to this infrastructure that are not identified during the testing phases of design and implementation, which may become evident only after we have started to fully use the underlying equipment or software, that could further degrade the user experience or increase our costs. As such, RSI could fail to continue to effectively scale and grow our technical infrastructure to accommodate increased demands. In addition a lack of resources (e.g., hardware, software, personnel, and service providers) could result in an inability to scale our services to meet business needs, system interruptions, degradation of service, or operational mistakes. Our business also may be subject to interruptions, delays or failures resulting from adverse weather conditions, other natural disasters, power loss, terrorism, cyber-attacks, public health emergencies (such as COVID-19) or other catastrophic events.

We believe that if our users have a negative experience with our product offerings, or if our brand or reputation is negatively affected, users may be less inclined to continue or resume utilizing our product offerings or to recommend our platform to other potential users. As such, a failure or significant interruption in our service could harm our reputation, our business, financial condition, results of operations and prospects.

Despite our security measures, our information technology and infrastructure may be vulnerable to attacks by hackers or breached due to employee error, malfeasance or other disruptions. Any such breach could compromise our networks and the information stored there could be accessed, publicly disclosed, lost or stolen. Any such access, disclosure, other loss or theft of information could result in legal claims or proceedings, liability under laws that protect the privacy of personal information, and regulatory penalties, disruption of our operations and the services we provide to users, damage to our reputation, and a loss of confidence in our products and services, each of which could adversely affect our business, financial condition, results of operations and prospects.

The secure maintenance and transmission of user information is a critical element of our operations. Our information technology and other systems that maintain and transmit user information, or the systems of third-party service providers and business partners, may be compromised by a malicious third-party penetration of our network security, or the network security of a third-party service provider or business partner, or impacted by intentional or unintentional actions or inactions by our employees, or the actions or inactions of a third-party service provider or business partner. As a result, our users’ information may be lost, disclosed, accessed or taken without such users’ consent. We have experienced attempts to breach our systems and other similar incidents in the past. For example, we have been and expect that we will continue to be subject to attempts to gain unauthorized access to or through our information systems or those we develop for our customers, whether by our employees or third parties, including phishing attacks by computer programmers and hackers who may develop and deploy viruses, worms or other malicious software programs. To date these attacks have not had a material impact on our operations or financial results, but we cannot provide assurance that they will not have a material impact in the future, including by overloading our systems and network and preventing our product offering from being accessed by legitimate users.

We rely on encryption and authentication technology licensed from third parties in an effort to securely transmit confidential and sensitive information. Advances in computer capabilities, new technological discoveries or other developments may result in the whole or partial failure of this technology to protect transaction data or other confidential and sensitive information from being breached or compromised. In

 

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addition, websites are often attacked through compromised credentials, including those obtained through phishing and credential stuffing. Our security measures, and those of our third-party service providers, may not detect or prevent all attempts to breach our systems, denial-of-service attacks, viruses, malicious software, break-ins, phishing attacks, social engineering, security breaches or other attacks and similar disruptions that may jeopardize the security of information stored in or transmitted by our websites, networks and systems or that we or such third parties otherwise maintain, including payment card systems, which may subject us to fines or higher transaction fees or limit or terminate our access to certain payment methods. We and such third parties may not anticipate or prevent all types of attacks until after they have already been launched. Further, techniques used to obtain unauthorized access to or sabotage systems change frequently and may not be known until launched against us or our third-party service providers.

In addition, security breaches can also occur as a result of non-technical issues, including intentional or inadvertent breaches by our employees or by third parties. These risks may increase over time as the complexity and number of technical systems and applications we use also increases. Breaches of our security measures or those of our third-party service providers or cybersecurity incidents could result in: unauthorized access to our sites, networks and systems; unauthorized access to and misappropriation of user information, including users’ personally identifiable information, or other confidential or proprietary information of ourselves or third parties; viruses, worms, spyware or other malware being served from our sites, networks or systems; deletion or modification of content or the display of unauthorized content on our sites; interruption, disruption or malfunction of operations; costs relating to breach remediation, deployment of additional personnel and protection technologies, response to governmental investigations and media inquiries and coverage; engagement of third-party experts and consultants; or litigation, regulatory action and other potential liabilities. In the past, the online gaming industry has experienced social engineering, phishing, malware and similar attacks and threats of denial-of-service attacks, none of which to date have been material to our business; however, such attacks could in the future have a material adverse effect on our operations. If any of these breaches of security should occur and be material, our reputation and brand could be damaged, our business may suffer, we could be required to expend significant capital and other resources to alleviate problems caused by such breaches, and we could be exposed to a risk of loss, litigation or regulatory action and possible liability. We cannot guarantee that recovery protocols and backup systems will be sufficient to prevent data loss. Actual or anticipated attacks may cause us to incur increasing costs, including costs to deploy additional personnel and protection technologies, train employees and engage third-party experts and consultants.

In addition, any party who is able to illicitly obtain a user’s password could access the user’s transaction data or personal information, resulting in the perception that our systems are insecure. Any compromise or breach of our security measures, or those of our third-party service providers, could violate applicable privacy, data protection, data security, network and information systems security and other laws and cause significant legal and financial exposure, adverse publicity and a loss of confidence in our security measures, which could have a material adverse effect on our business, financial condition, results of operations and prospects. We continue to devote significant resources to protect against security breaches or we may need to in the future to address problems caused by breaches, including notifying affected users and responding to any resulting litigation, which in turn, diverts resources from the growth and expansion of our business.

Failure to protect or enforce our intellectual property rights or the costs involved in such enforcement could harm our business, financial condition, results of operations and prospects.

We rely on trademark, copyright, patent, trade secret, and domain-name-protection laws to protect our rights in intellectual property. In the United States and in certain foreign jurisdictions, RSI has filed applications to protect aspects of its intellectual property, currently holds several patent applications in multiple jurisdictions, and in the future we may acquire additional patents, which could require significant cash expenditures. However, third parties may knowingly or unknowingly infringe our rights in intellectual property, third parties may challenge intellectual property rights held by us, and pending and future trademark and patent applications may not be approved. In any of these cases, we may be required to expend significant time and expense to prevent

 

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infringement of or to enforce our rights. Notwithstanding our intellectual property rights, there can be no assurance that others will not offer products or services that are substantially similar to ours and compete with our business.

Circumstances outside our control could pose a threat to our intellectual property rights. For example, effective intellectual property protection may not be available in the United States or other countries in which we operate or intend to operate our business. Also, the efforts we have taken to protect our intellectual property rights may not be sufficient or effective, and any significant impairment of our intellectual property rights could harm our business or our ability to compete. If we are unable to protect our proprietary offerings and features, competitors may copy them. Additionally, protecting our intellectual property rights is costly and time-consuming. Any unauthorized use of our intellectual property or disclosure of our confidential information or trade secrets could make it more expensive to do business, thereby harming our operating results. Furthermore, if we are unable to protect our intellectual property rights or prevent unauthorized use or appropriation by third parties, the value of our brand and other intangible assets may be diminished, and competitors may be able to more effectively mimic our product offerings and services. Any of these events could seriously harm our business, financial condition, results of operations and prospects.

We will rely on licenses and service agreements to use the intellectual property rights of third parties which are incorporated into or used in our products and services. Failure to renew or expand existing licenses or service agreements may require us to modify, limit or discontinue certain product offerings, which could materially affect our business, financial condition, results of operations and prospects.

We rely on products, technologies and intellectual property that we license or that are made available to us through service agreements from third parties, for use in our B2B, B2B2C, and B2C offerings. Substantially all of our product offerings and services use intellectual property licensed or made available to us through service agreements from third parties. The future success of our business may depend, in part, on our ability to obtain, retain and/or expand licenses or service agreements for certain technologies. We cannot assure that these third-party licenses and services agreements, or support for the technologies licensed or provided to us thereunder, will continue to be available to us on commercially reasonable terms, if at all. In the event that we cannot renew and/or expand existing licenses or services agreements, we may be required to discontinue or limit our use of the product offerings that include or incorporate the licensed or provided technology.

Some of our license agreements contain minimum guaranteed royalty payments to the third party. If we are unable to generate sufficient revenue to offset the minimum guaranteed royalty payments, it could have a negative effect on our business, financial condition, results of operations, prospects, and cash flows. Our license agreements generally allow for assignment in the event of a strategic transaction but contain some limited termination rights post-assignment. Certain of our license agreements grant the licensor rights to audit our use of their intellectual property. Disputes with licensors over uses or terms could result in the payment of additional royalties or penalties by us, cancellation or non-renewal of the underlying license or litigation.

The regulatory review process and licensing requirements also may preclude us from using technologies owned or developed by third parties if those parties are unwilling to subject themselves to regulatory review or do not meet regulatory requirements. Some gaming authorities require gaming manufacturers to obtain approval before engaging in certain transactions, such as acquisitions, mergers, reorganizations, financings, stock offerings and share repurchases. Obtaining such approvals can be costly and time consuming, and we cannot assure that such approvals will be granted or that the approval process will not result in delays or disruptions to our strategic objectives.

 

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Risks Related to our Third Party Vendor Relationships

We rely on third party cloud infrastructure and hosting service providers and service rooms hosted by certain of our land-based casino partners. Disruption or interference with this infrastructure or services rooms could adversely affect our business, financial condition, results of operations and prospects.

We host our sports wagering and online casino wagering platforms and offerings using third party public and on-premise private cloud infrastructure and hosting services and on-premise service rooms hosted by certain of our land-based casino partners. We do not have full control over the operations of the infrastructure of the third-party service providers that we use or anticipate using (i.e., Amazon Web Services and Google Cloud) or the facilities (including the service rooms) of our casino partners. Such infrastructure and facilities are vulnerable to damage or interruption from natural disasters, cybersecurity attacks, terrorist attacks, power outages, and similar events or acts of misconduct. We have experienced and we expect that in the future we will experience, interruptions, delays and outages in service and availability from these providers on account of, among other things, infrastructure changes, human or software errors, website hosting disruptions, and capacity constraints. Any such interruptions, delays or outages result in sustained or repeated system failures with respect to our platform could reduce the attractiveness of our offerings. Any capacity constraints may also impact our ability to maintain performance of our offerings. Should our agreements with any third party cloud service provider terminate or we add new cloud infrastructure service providers, we may experience additional costs and platform performance downtime in adding or transitioning to new or additional service providers. These impacts (and any associated negative publicity regarding them) may harm our brand or reduce users using our platform, which may negatively impact our business, financial condition, results of operations and prospects.

We rely on third-party providers to validate the identity and identify the location of our users, and if such providers fail to perform adequately or provide accurate information or we do not maintain business relationships with them, our business, financial condition, results of operations and prospects could be adversely affected.

There is no guarantee that the third-party geolocation and identity verification systems that we rely on perform adequately, or will be effective. We rely on our geolocation and identity verification systems to ensure we are in compliance with certain laws and regulations, and any service disruption to those systems would prohibit us from operating our platform, and would adversely affect our business. Additionally, incorrect or misleading geolocation and identity verification data with respect to current or potential users received from third-party service providers may result in us inadvertently allowing access to our product offerings to individuals who should not be permitted to access them, or otherwise inadvertently deny access to individuals who should be able to access our product offerings, in each case based on inaccurate identity or geographic location determination. Our third-party geolocation services provider relies on its ability to obtain information necessary to determine geolocation from mobile devices, operating systems, and other sources. Changes, disruptions or temporary or permanent failure to access such sources by our third-party services providers may result in their inability to accurately determine the location of our users. Moreover, our inability to maintain our existing contracts with third-party services providers, or to replace them with equivalent third parties, may result in our inability to access geolocation and identity verification data necessary for our day-to-day operations. If any of these risks materializes, we may be subject to disciplinary action, fines, lawsuits, and our business, financial condition, results of operations and prospects could be adversely affected.

Our platform contains third-party open source software components, and failure to comply with the terms of the underlying open source software licenses could restrict our ability to provide our product offerings.

Our platform contains software components licensed to us by third-party authors under “open source” licenses (“Open Source Software”). Use and distribution of Open Source Software may entail greater risks than use of third-party commercial software, as licensors of Open Source Software generally do not provide support, warranties, indemnification or other contractual protections regarding infringement claims or the quality of the licensed code. In addition, the public availability of Open Source Software may make it easier for others to compromise our platform or product offerings.

 

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Some licenses for Open Source Software contain requirements that we make available source code for modifications or derivative works we create, or grant other licenses to our intellectual property, if we use such Open Source Software in certain ways. If we combine our proprietary software with Open Source Software in a certain manner, we could, under certain licenses for Open Source Software, be required to release the source code of our proprietary software to the public. This would allow our competitors to create similar offerings with lower development effort and time and ultimately could result in a loss of our competitive advantages. Alternatively, to avoid the public release of the affected portions of our source code, we could be required to expend substantial time and resources to re-engineer some or all of our proprietary software.

Although we review our use of Open Source Software to avoid subjecting our platform and product offerings to conditions we do not intend, the terms of many licenses for Open Source Software have not been interpreted by United States or foreign courts, and there is a risk that these licenses could be construed in a way that could impose unanticipated conditions or restrictions on our ability to provide or distribute our platform or product offerings. From time to time, there have been claims challenging the ownership of Open Source Software against companies that incorporate Open Source Software into their solutions. As a result, we could be subject to lawsuits by parties claiming ownership of what we believe to be Open Source Software. Moreover, we cannot assure you that our processes for controlling our use of Open Source Software in our platform and product offerings will be effective. If we are held to have breached or failed to fully comply with all the terms and conditions of an Open Source Software license, we could face infringement or other liability, or be required to seek costly licenses from third parties to continue providing our product offerings on terms that are not economically feasible, to re-engineer our platform, to discontinue or delay the provision of our product offerings if re-engineering could not be accomplished on a timely basis or to make generally available, in source code form, our proprietary software, any of which could adversely affect our business, financial condition, results of operations and prospects.

We rely on third-party payment processors to process deposits and withdrawals made by our users into the platform, and if we cannot manage our relationships with such third parties and other payment-related risks, our business, financial condition, results of operations and prospects could be adversely affected.

We rely on a third-party payment processor to process payments made by our users into our platform. If our third-party payment processor terminates its relationship with us or refuses to renew its agreement with us on commercially reasonable terms, we would need to find an alternate payment processor, and may not be able to secure similar terms or replace such payment processor in an acceptable time frame. Further, the software and services provided by our third-party payment processor may not meet our expectations, contain errors or vulnerabilities, be compromised or experience outages. Any of these risks could cause us to lose our ability to accept online payments or other payment transactions or make timely payments to users on our platform, any of which could make our platform less trustworthy and convenient and adversely affect our ability to attract and retain our users.

Nearly all of our payments are made by credit card, debit card or through other third-party payment services, which subjects us to certain regulations and to the risk of fraud. We may in the future offer new payment options to users that may be subject to additional regulations and risks. We are also subject to a number of other laws and regulations relating to the payments we accept from our users, including with respect to money laundering, money transfers, privacy and information security. If we fail to comply with applicable rules and regulations, we may be subject to civil or criminal penalties, fines and/or higher transaction fees and may lose our ability to accept online payments or other payment card transactions, which could make our product offerings less convenient and attractive to our users. If any of these events were to occur, our business, financial condition, results of operations and prospects could be adversely affected.

For example, if we are deemed to be a money transmitter as defined by applicable regulation, we could be subject to certain laws, rules and regulations enforced by multiple authorities and governing bodies in the United States and numerous state and local agencies who may define money transmitter differently. For example, certain

 

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states may have a more expansive view of who qualifies as a money transmitter. Additionally, outside of the United States, we could be subject to additional laws, rules and regulations related to the provision of payments and financial services, and if we expand into new jurisdictions, the foreign regulations and regulators governing our business that we are subject to will expand as well. If we are found to be a money transmitter under any applicable regulation and we are not in compliance with such regulations, we may be subject to fines or other penalties in one or more jurisdictions levied by federal or state or local regulators, including state Attorneys General, as well as those levied by foreign regulators. In addition to fines, penalties for failing to comply with applicable rules and regulations could include criminal and civil proceedings, forfeiture of significant assets or other enforcement actions. We could also be required to make changes to our business practices or compliance programs as a result of regulatory scrutiny.

Additionally, our payment processors require us to comply with payment card network operating rules, which are set and interpreted by the payment card networks. The payment card networks could adopt new operating rules or interpret or reinterpret existing rules in ways that might prohibit us from providing certain product offerings to some users, be costly to implement or difficult to follow. We have agreed to reimburse our payment processors for fines they are assessed by payment card networks if we or the users on our platform violate these rules. Any of the foregoing risks could adversely affect our business, financial condition, results of operations and prospects.

We rely on other third-party service and content providers (including third party sports wagering risk management and trading providers, sports data providers and online slot providers) and if such third parties do not perform adequately or terminate their relationships with us, our costs may increase and our business, financial condition, results of operations and prospects could be adversely affected.

Our success depends in part on our relationships with third-party service providers. For example, we receive sports wagering odds data, sports wagering risk management services and sports wagering trading services from a third-party, and in some jurisdictions, we are required to obtain official league data. We also rely on third parties for content delivery (such as online slots), load balancing and protection against distributed denial-of-service attacks. If those providers do not perform adequately, our users may experience issues or interruptions with their experiences, and RSI may be held responsible by gaming regulators for the errors of third-party content providers. Furthermore, if any of our third-party service or data providers terminates its relationship with us or refuses to renew its agreement with us on commercially reasonable terms, we would need to find an alternate provider, and if any of our third party service providers is acquired by a competitor, we may need to find an alternate provider, and in each case we may not be able to secure similar terms or replace such providers in an acceptable time frame. We also rely on other software and services supplied by third parties, such as communications and internal software, and our business may be adversely affected to the extent such software and services do not meet our expectations, contain errors or vulnerabilities, are compromised or experience outages. Any of these risks could increase our costs and adversely affect our business, financial condition, results of operations and prospects. Further, any negative publicity related to any of our third-party service providers, including any publicity related to regulatory concerns or allegations of bad actions undertaken by any of our third-party service providers, could adversely affect our reputation and brand, result in us severing our relationship with such third-party service provider and could potentially lead to increased regulatory or litigation exposure.

We incorporate technology from third-party vendors into our platform. We cannot be certain that these vendors are not infringing the intellectual property rights of others or that they have sufficient rights to such technology in all jurisdictions in which we may operate. Some of our material license and services agreements with third party vendors allow the vendor to terminate for convenience. If we are unable to obtain or maintain rights to any of this technology because of intellectual property infringement claims brought by third parties against our vendors or against us, if our third party vendors terminate any license or services agreements, or if we are unable to continue to obtain the technology or enter into new agreements on commercially reasonable terms, our ability to develop our platform or product offerings containing that technology could be severely limited and our business could be harmed. Additionally, if we are unable to obtain necessary technology from third parties,

 

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we may be forced to acquire or develop alternate technology, which may require significant time and effort and may be of lower quality or performance standards. This would limit and delay our ability to provide new or competitive product offerings and increase our costs. If alternate technology cannot be obtained or developed, we may not be able to offer certain functionality as part of our product offerings, which could adversely affect our business, financial condition, results of operations and prospects.

If Internet and other technology-based service providers experience service interruptions, our ability to conduct our business may be impaired and our business, financial condition, results of operations and prospects could be adversely affected.

A substantial portion of our network infrastructure is provided by third parties, including Internet service providers and other technology-based service providers. We use technology-based service providers such as CloudFare to mitigate any distributed denial-of-service attacks. However, if Internet service providers experience service interruptions, including because of cyber-attacks, or due to an event causing an unusually high volume of Internet use (such as a pandemic or public health emergency), communications over the Internet may be interrupted and impair our ability to conduct our business. Internet service providers and other technology-based service providers may in the future roll out upgraded or new mobile or other telecommunications services, such as 5G or 6G services, which may not be successful and thus may impact the ability of our users to access our platform or product offerings in a timely fashion or at all. In addition, our ability to process e-commerce transactions depends on bank processing and credit card systems. To prepare for system problems, we continuously seek to strengthen and enhance our current facilities and the capabilities of our system infrastructure and support. Nevertheless, there can be no assurance that the Internet infrastructure or our own network systems will continue to be able to meet the demand placed on us by the continued growth of the Internet, the overall online gaming industry and our users. Any difficulties these providers face, including the potential of certain network traffic receiving priority over other traffic (i.e., lack of net neutrality), may adversely affect our business, and we exercise little control over these providers, which increases our vulnerability to problems with the services they provide. Any system failure as a result of reliance on third parties, such as network, software or hardware failure, including as a result of cyber-attacks, which causes a loss of our users’ property or personal information or a delay or interruption in our online services and products and e-commerce services, including our ability to handle existing or increased traffic, could result in a loss of anticipated revenue, interruptions to our platform and product offerings, cause us to incur significant legal, remediation and notification costs, degrade the customer experience and cause users to lose confidence in our product offerings, any of which could have a material adverse effect on our business, financial condition, results of operations and prospects.

Our growth will depend, in part, on the success of our strategic relationships with third parties. Overreliance on certain third parties, or our inability to extend existing relationships or agree to new relationships may cause unanticipated costs for us and impact our financial performance in the future.

RSI relies, and we expect to continue to rely, on relationships with casinos and other third parties in order to attract users to our platform. These relationships along with providers of online services, search engines, social media, directories and other websites and ecommerce businesses direct consumers to the RSI platform. While we believe there are other third parties that could drive users to our platform, adding or transitioning to them may disrupt our business and increase our costs. In the event that any of RSI’s existing relationships or our future relationships fails to provide services to us in accordance with the terms of our arrangement, or at all, and we are not able to find suitable alternatives, this could impact our ability to attract consumers cost effectively and harm our business, financial condition, results of operations and prospects.

 

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Risks Related to Our Affiliate Arrangements

Following the completion of the Business Combination, RSI will be a “controlled” company within the meaning of the rules of the NYSE and, as a result, we will qualify for, and intend to rely on, exemptions from certain corporate governance requirements. You will not have the same protections as those afforded to stockholders of companies that are subject to such governance requirements.

After completion of the Business Combination, Neil G. Bluhm and Gregory A. Carlin and, their respective trusts (collectively, the “Controlling Holders”) will control a majority of the voting power of our outstanding common stock. As a result, we will be a “controlled company” within the meaning of the corporate governance standards of the NYSE. Under these rules, a company of which more than 50% of the voting power for the election of directors is held by an individual, group or another company is a “controlled company” and may elect not to comply with certain corporate governance requirements, including:

 

   

the requirement that a majority of our Board consist of independent directors;

 

   

the requirement that we have a nominating and corporate governance committee that is composed entirely of independent directors with a written charter addressing the committee’s purpose and responsibilities;

 

   

the requirement that we have a compensation committee that is composed entirely of independent directors with a written charter addressing the committee’s purpose and responsibilities; and

 

   

requirement for an annual performance evaluation of the nominating and corporate governance and compensation committees.

Following this offering, we intend to utilize these exemptions. As a result, we may not have a majority of independent directors on our Board, our compensation and our nominating and corporate governance committees may not consist entirely of independent directors and our compensation and our nominating and corporate governance committees may not be subject to annual performance evaluations. Accordingly, you will not have the same protections afforded to stockholders of companies that are subject to all of the corporate governance requirements of the NYSE. Furthermore, the Controlling Holders intend to enter into a voting agreement whereby they agree to vote together on certain matters presented to the Company’s stockholders for so long as the voting agreement is in effect, which may have the effect of extending the period in which RSI is a “controlled company” and its utilizing the exemptions discussed above.

The Controlling Holders control us, and their interests may conflict with ours or yours in the future.

The Controlling Holders will own more than 50% of our common stock after completion of the Business Combination, and they intend to enter into a voting agreement prior to Closing where they agree to vote together on certain matters presented to the stockholders. This means that, based on their combined percentage voting power held after the offering, the Controlling Holders together will control the vote of all matters submitted to a vote of our shareholders, which will enable them to control the election of the members of the Board and all other corporate decisions. Additionally, the Controlling Holders intend to enter into a voting agreement prior to the consummation of the Business Combination in which they will agree to continue to vote together on certain matters to be voted on by the stockholders, including director nominees. Even when the Controlling Holders cease to own shares of our stock representing a majority of the total voting power, for so long as the Controlling Holders continue to own a significant percentage of our stock, the Controlling Holders will still be able to significantly influence the composition of our Board and the approval of actions requiring shareholder approval. Accordingly, for such period of time, the Controlling Holders will have significant influence with respect to our management, business plans and policies, including the appointment and removal of our officers, decisions on whether to raise future capital and amending our charter and bylaws, which govern the rights attached to our common stock. In particular, for so long as the Controlling Holders continue to own a significant percentage of our stock, the Controlling Holders will be able to cause or prevent a change of control of us or a change in the composition of our Board and could preclude any unsolicited acquisition of us. The concentration of ownership

 

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could deprive you of an opportunity to receive a premium for your shares of common stock as part of a sale of us and ultimately might affect the market price of our common stock.

In addition, the Company will enter into the Investor Rights Agreement, as more fully described under the section entitled “The Business Combination Proposal – Related Agreements – Investor Rights Agreement”, pursuant to which, for so long as the Company is a “controlled company” under the applicable rules of the NYSE, the Sellers’ Representative (as representative of the Controlling Holders and the other original equityholders in Rush Street Interactive, LP) and the Sponsor will have the right to nominate nine (or the maximum number that may be nominated by the Sellers’ Representative without violating NYSE’s controlled company requirements) and two directors, respectively, to the board of directors of the Company, subject to certain independence and holdings requirements. In the event that the Company is no longer a “controlled company” under the applicable rules of NYSE, the Sponsor will have the right to nominate two directors and the Sellers’ Representative will have the right to nominate a number of directors equal to the greater of the number of directors permitted by NYSE or a number equal to the total number of directors multiplied by the percentage of issued and outstanding voting securities of the Company held by the Sellers and their permitted transferees at such time, in each case, subject to certain independence and holdings requirements.

The Controlling Holders and their affiliates engage in a broad spectrum of activities, including investments in the gaming and casino industries generally. In the ordinary course of their business activities, the Controlling Holders and their affiliates may engage in activities such as investing in or advising businesses that directly or indirectly compete with certain portions of our business or are suppliers or customers of ours. Our certificate of incorporation to be effective in connection with the closing of this offering will provide that none of the Controlling Holders, any of their affiliates or affiliated entities or any director who is not employed by us or its affiliates or affiliated entities will have any duty to refrain from engaging, directly or indirectly, in the same business activities or similar business activities or lines of business in which we operate. The Controlling Holders also may pursue acquisition opportunities that may be complementary to our business, and, as a result, those acquisition opportunities may not be available to us. In addition, the Controlling Holders may have an interest in pursuing acquisitions, divestitures and other transactions that, in their judgment, could enhance their investment, even though such transactions might involve risks to you.

We have arrangements with our affiliates that impact our operations.

RSI has engaged, and may in the future engage, in transactions with affiliates and other related parties, including, for example, the entry into agreements with the “Rivers” branded casinos located in each of Pennsylvania, Illinois, New York and the anticipated “Rivers” branded casino in Portsmouth, Virginia to operate retail and online sports wagering and online gaming on behalf of such casinos as and when retail and online sports wagering and online gaming are legalized in each respective jurisdiction. While an effort has been made and will continue to be made to obtain services from affiliated persons and other related parties at rates and on terms as favorable as would be charged by others, if that were not to be achieved in the future that could have a negative impact on RSI’s operations. Both Mr. Bluhm, our chairman, director and a significant stockholder and Mr. Carlin, our chief executive officer, director and a significant stockholder, has an indirect ownership interest in certain of our related parties, including Rush Street Gaming and the “Rivers” branded casinos, with which we have entered into, or in the future may enter into, agreements or arrangements. In addition, Mr. Carlin will be chief executive officer of both Rush Street Gaming and RSI following the business combination. See Certain Relationships and Related Party Transactions. Our Controlling Holders may economically benefit from our arrangements with related parties. If we engage in related party transactions on unfavorable terms, our operating results will be negatively impacted.

 

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Risks Related to our Liquidity and Capital Resources

We may require additional capital to support our growth plans, and such capital may not be available on terms acceptable to us, if at all. This could hamper our growth and adversely affect our business.

We intend to make significant investments to support our business growth and may require additional funds to respond to business challenges, including the need to develop new product offerings and features or enhance our existing platform, improve our operating infrastructure or acquire complementary businesses, personnel and technologies. Accordingly, we may need to engage in equity or debt financings to secure additional funds. Our ability to obtain additional capital, if and when required, will depend on our business plans, investor demand, our operating performance, capital markets conditions and other factors. If we raise additional funds by issuing equity, equity-linked or debt securities, those securities may have rights, preferences or privileges senior to the rights of our currently issued and outstanding equity or debt, and our existing shareholders may experience dilution. If RSI is unable to obtain additional capital when required, or on satisfactory terms, our ability to continue to support our business growth or to respond to business opportunities, challenges or unforeseen circumstances could be adversely affected, and our business, financial condition, results of operations and prospects may be harmed.

We may invest in or acquire other businesses, and our business may suffer if we are unable to successfully integrate acquired businesses into our company or otherwise manage the growth associated with multiple acquisitions.

As part of its business strategy, RSI may make acquisitions as opportunities arise to add new or complementary businesses, products, brands or technologies. In some cases, the costs of such acquisitions may be substantial, including as a result of professional fees and due diligence efforts. There is no assurance that the time and resources expended on pursuing a particular acquisition will result in a completed transaction, or that any completed transaction will ultimately be successful. In addition, we may be unable to identify suitable acquisition or strategic investment opportunities, or may be unable to obtain any required financing or regulatory approvals, and therefore may be unable to complete such acquisitions or strategic investments on favorable terms, if at all. We may decide to pursue acquisitions with which our investors may not agree and we cannot assure investors that any acquisition or investment will be successful or otherwise provide a favorable return on investment. In addition, acquisitions and the integration thereof require significant time and resources and place significant demands on our management, as well as on our operational and financial infrastructure. In addition, if we fail to successfully close transactions or integrate new teams, or integrate the products and technologies associated with these acquisitions into our company, our business could be seriously harmed. Acquisitions may expose us to operational challenges and risks, including:

 

   

the ability to profitably manage acquired businesses or successfully integrate the acquired businesses’ operations, personnel, financial reporting, accounting and internal controls, technologies and products into the RSI’s business;

 

   

increased indebtedness and the expense of integrating acquired businesses, including significant administrative, operational, economic, geographic or cultural challenges in managing and integrating the expanded or combined operations;

 

   

entry into jurisdictions or acquisition of products or technologies with which we have limited or no prior experience, and the potential of increased competition with new or existing competitors as a result of such acquisitions;

 

   

diversion of management’s attention and the over-extension of our operating infrastructure and our management systems, information technology systems, and internal controls and procedures, which may be inadequate to support growth;

 

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the ability to fund our capital needs and any cash flow shortages that may occur if anticipated revenue is not realized or is delayed, whether by general economic or market conditions, or unforeseen internal difficulties; and

 

   

the ability to retain or hire qualified personnel required for expanded operations.

Our acquisition strategy may not succeed if we are unable to remain attractive to target companies or expeditiously close transactions. Issuing shares of Class A Common Stock to fund an acquisition would cause economic dilution to existing stockholders. If we develop a reputation for being a difficult acquirer or having an unfavorable work environment, or target companies view our Class A Common Stock unfavorably, we may be unable to consummate key acquisition transactions essential to our corporate strategy and our business, financial condition, results of operations and prospects may be seriously harmed.

We may invest or spend the proceeds of the Business Combination in ways with which the investors may not agree or in ways which may not yield a return.

Our management will have considerable discretion in the application of the net proceeds of the Business Combination, and our shareholders will not have the opportunity to approve how the proceeds are being used. If the net proceeds are used for corporate purposes that do not result in an increase to the value of our business, our stock price could decline.

Risks Relating to dMY and the Business Combination

Directors of dMY have potential conflicts of interest in recommending that securityholders vote in favor of approval of the Business Combination and approval of the other proposals described in this proxy statement.

When considering the Board’s recommendation that dMY’s stockholders vote in favor of the business combination proposal, dMY’s stockholders should be aware that directors and executive officers of dMY have interests in the Business Combination that may be different from, or in addition to, the interests of its stockholders. These interests include:

 

   

the anticipated election of Harry L. You and Niccolo de Masi, two of dMY’s existing officers and directors, as members of the Board of the Company;

 

   

the continued indemnification of former and current directors and officers of dMY and the continuation of directors’ and officers’ liability insurance after the Business Combination;

 

   

the fact that dMY’s initial stockholders have waived their right to redeem any of the founder shares, private placement shares and public shares in connection with a stockholder vote to approve a proposed initial business combination;

 

   

the fact that dMY’s initial stockholders paid an aggregate of $25,000 for the founder shares, which will convert into 5,750,000 shares of Class A Common Stock in accordance with the terms of the Charter, subject to adjustment, and such securities will have a significantly higher value at the time of the Business Combination, estimated at approximately $[•] based on the closing price of $[•] per public shares on the NYSE on [•], 2020;

 

   

the fact that the Sponsor paid $6,600,000 for 6,600,000 private placement warrants, with each private placement warrant being exercisable commencing on the later of 12 months from the closing of the IPO and 30 days following the Closing for one share of Class A Common Stock for one share of Class A Common Stock at $11.50 per share; the warrants held by the Sponsor had an aggregate market value of approximately $[•] based upon the closing price of $[•] per warrant on the NYSE on [•], 2020;

 

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the right of the Sponsor to receive approximately 6,600,000 shares of Class A Common Stock to be issued upon exercise of their private placement warrants following the Business Combination, subject to certain lock-up periods; and

 

   

if the trust account is liquidated, including in the event dMY is unable to complete an initial business combination within the required time period, the Sponsor has agreed that it will be liable to dMY if and to the extent any claims by a third-party (other than our independent registered public accounting firm) for services rendered or products sold to dMY, or a prospective target business with which dMY has entered into a written letter of intent, confidentiality or other similar agreement or business combination agreement, reduce the amount of funds in the trust account to below: (i) $10.00 per public share; or (ii) such lesser amount per public share held in the trust account as of the date of the liquidation of the trust account due to reductions in the value of the trust assets, in each case, net of the interest which may be withdrawn to pay taxes and up to $100,000 of interest to pay dissolution expenses, except as to any claims by a third-party who executed a waiver of any and all rights to seek access to the trust account and except as to any claims under our indemnity of the underwriters of the IPO against certain liabilities, including liabilities under the Securities Act.

These financial interests of the founders, officers and directors and entities affiliated with them may have influenced their decision to approve the Business Combination. You should consider these interests when evaluating the Business Combination and the recommendation of the Board to vote in favor of the business combination proposal and other proposals to be presented to the stockholders.

Goldman has a potential conflict of interest regarding the Business Combination.

Goldman was an underwriter in our IPO, and, upon consummation of the Business Combination, the underwriters of the IPO are entitled to $8,050,000 of deferred underwriting commission, of which Goldman is entitled to $6,400,000. The underwriters of the IPO have agreed to waive their rights to the deferred underwriting commission held in the trust account in the event the Company does not complete an initial business combination within 24 months of the closing of the IPO. Accordingly, if the Business Combination, or any other initial business combination, is not consummated by that time and the Company is therefore required to be liquidated, the underwriters of the initial public offering, including Goldman, will not receive any of the deferred underwriting commission and such funds will be returned to the Company’s public stockholders upon its liquidation.

Furthermore, Goldman is engaged by the Company as its financial advisor for the Business Combination. The Company decided to retain Goldman as its financial advisor based primarily on Goldman’s extensive knowledge, strong market position and positive reputation in equity capital markets and its experienced and capable investment banking team.

In addition, under the terms of Goldman’s engagement, the Company agreed to reimburse Goldman for its reasonable out-of-pocket expenses, including the fees and disbursements of its outside attorneys, and to indemnify Goldman and certain related parties against liabilities, including liabilities under federal securities laws, in each case, in connection with, as a result of, or relating to its engagement.

Goldman therefore has an interest in the Company completing a business combination that will result in the payment of the deferred underwriting commission to the underwriters of the IPO, including Goldman. In considering approval of the Business Combination, the Company’s stockholders should consider the roles of Goldman in light of the deferred underwriting commission Goldman is entitled to receive if the Business Combination is consummated within 24 months of the closing of the IPO.

 

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Subsequent to the consummation of the Business Combination, the Company may be required to take write-downs or write-offs, restructuring and impairment or other charges that could have a significant negative effect on the Company’s financial condition, results of operations and stock price, which could cause you to lose some or all of your investment.

Although dMY has conducted due diligence on RSI, dMY cannot assure you that this diligence revealed all material issues that may be present in its businesses, that it would be possible to uncover all material issues through a customary amount of due diligence, or that factors outside of dMY’s or RSI’s control will not later arise. As a result, the Company may be forced to later write-down or write-off assets, restructure its operations, or incur impairment or other charges that could result in losses. Even if the due diligence successfully identifies certain risks, unexpected risks may arise and previously known risks may materialize in a manner not consistent with dMY’s preliminary risk analysis. Even though these charges may be non-cash items and not have an immediate impact on the Company’s liquidity, the fact that the Company reports charges of this nature could contribute to negative market perceptions about the Company or its securities. In addition, charges of this nature may cause the Company to violate net worth or other covenants to which we may be subject. Accordingly, any stockholders who choose to remain stockholders following the Business Combination could suffer a reduction in the value of their shares. Such stockholders are unlikely to have a remedy for such reduction in value unless they are able to successfully claim that the reduction was due to the breach by dMY’s officers or directors of a duty of care or other fiduciary duty owed to them, or if they are able to successfully bring a private claim under securities laws that the proxy solicitation or tender offer materials, as applicable, relating to the Business Combination contained an actionable material misstatement or material omission.

To the extent that any shares of Class A Common Stock are issued in connection with the exchange by Sellers of RSI Units for Class A Common Stock as permitted by the terms of the RSI A&R LPA or upon exercise of any of the warrants, or to the extent that the Earnout Shares become earned in accordance with the terms and conditions of the Business Combination Agreement, the number of shares eligible for resale in the public market would increase.

Pursuant to the terms of the RSI A&R LPA, the Sellers will be able to exchange all or any portion of their RSI Units, together with the cancelation of an equal number of shares of Class V Voting Stock equal to the number of exchanged RSI Units, for a number of shares of Class A Common Stock equal to the number of exchanged RSI Units. The Sellers are expected to retain 145,000,000 RSI units immediately after the Closing, assuming (a) none of dMY’s public shareholders exercise redemption rights with respect to their public shares, (b) the parties to the Business Combination Agreement incur $30 million of transaction expenses, (c) the Put-Calls are in effect as of the Closing and are exercised shortly following the Closing or are not in effect, (d) the maximum amount of Purchased RSI Units (other than the Put-Call Units) are purchased from the Sellers (other than the Put-Call Sellers) (i.e., $99,235,500 if the Put-Calls are in effect or $125,000,000 if the Put-Calls are not in effect) at Closing, (e) none of the 1,205,937 Founder Holders Forfeiture Shares are forfeited because the Available Closing Date Cash exceeds $245,000,000, (f) the Earnout Shares are excluded unless and until they are earned in accordance with the Business Combination Agreement, (g) there is no exercise of Sponsor’s 6,600,000 private placement warrants at an exercise price of $11.50 per share (which warrants are not exercisable until the later of 12 months from the closing of the IPO and 30 days after the completion of the Business Combination), (h) none of the parties purchase shares of Class A Common Stock in the open market, (i) there are no other issuances of equity interests of the Company prior to or in connection with the Closing, (j) there are no issuances of any shares of the Company’s Class A Common Stock to the Sellers upon the exchange of Retained RSI Units (and the surrender of a corresponding number of shares of Class V Voting Stock), and (k) there are no issuances of any shares of Class A Common Stock within the five business days following the Closing to additional private placement investors or following the Closing under the Company’s Plan.

Furthermore, following the Business Combination, the Company will have 11,500,000 outstanding warrants to purchase 11,500,000 shares of Class A Common Stock at an exercise price of $11.50 per share, which warrants will become exercisable on the later of 12 months from the closing of the IPO and 30 days following the Closing for one share of Class A Common Stock. In addition, there will be 6,600,000 private placement warrants outstanding exercisable for 6,600,000 shares of common stock at an exercise price of $11.50 per share, which warrants will become exercisable on the later of 12 months from the closing of the IPO and 30 days following the Closing for one share of Class A Common Stock.

 

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To the extent that any shares of Class A Common Stock are issued in connection with a redemption by any Sellers of Class V Voting Stock for Class A Common Stock pursuant to the terms of the RSI A&R LPA or upon exercise of any of the warrants to purchase shares of Class A Common Stock, there will be an increase in the number of shares of Class A Common Stock eligible for resale in the public market. Sales of a substantial number of such shares in the public market could adversely affect the market price of Class A Common Stock.

Pursuant to the Business Combination Agreement, 1,212,813 shares of Class A Common Stock held by the Founder Holders and 15,000,000 shares of Class V Voting Stock issued to the Sellers in connection with the Business Combination are subject to earnout criteria set forth in the Business Combination Agreement and, until such earnout criteria are met, the holders thereof will not be entitled to sell or transfer or vote any of such shares. To the extent that the earnout shares held by the Founder Holders become earned, the Founder Holders will be entitled to one vote per share for each such earnout share and there will be an increase in the number of shares of Class A Common Stock eligible for resale in the public market. To the extent that the earnout shares held by the Sellers become earned, the Sellers will be entitled to one vote per share for each such earnout share and will be entitled to redeem such shares of Class V Voting Stock for Class A Common Stock pursuant to the terms of the RSI A&R LPA and there will be an increase in the number of shares of Class A Common Stock eligible for resale in the public market.

If dMY or the Company raises capital in connection with the Business Combination or in the future by issuing shares of common or preferred stock or other equity or equity-linked securities, convertible debt or other hybrid equity securities, then-existing stockholders may experience dilution, such new securities may have rights senior to those of the Company’s common stock, and the market price of the Company’s common stock may be adversely effected.

If dMY or the Company raises capital in the future, including by selling shares of Class A Common Stock in connection with the PIPE and/or any Permitted Equity Financing within the five business days following the Closing Date as permitted by and subject to the terms of the Business Combination Agreement, then existing stockholders may experience dilution. The Charter and the Proposed Charter provide that preferred stock may be issued from time to time in one or more series. The Board is 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. The Board may, without stockholder approval, issue preferred stock with voting and other rights that could adversely affect the voting power and other rights of the holders of the shares of common stock and could have anti-takeover effects. The ability of the Board to issue preferred stock without stockholder approval could have the effect of delaying, deferring or preventing a change of control of us or the removal of existing management. The issuance of any such securities may have the impact of adversely affecting the market price of the Company’s common stock.

dMY is not required to obtain and has not obtained an opinion from an independent investment banking firm or from an independent accounting firm, and consequently, you may have no assurance from an independent source that the terms of the Business Combination are fair to dMY from a financial point of view.

dMY is not required to obtain an opinion from an independent investment banking firm that is a member of FINRA or from an independent accounting firm that the price it is paying is fair to dMY from a financial point of view. The Board did not obtain a fairness opinion in connection with their determination to approve the Business Combination. In analyzing the Business Combination, the Board and dMY’s management conducted due diligence on RSI and researched the industry in which RSI operates and concluded that the Business Combination was in the best interest of its stockholders. Accordingly, dMY’s stockholders will be relying solely on the judgment of the Board in determining the value of the Business Combination, and the Board may not have properly valued such business. The lack of third-party fairness opinion may also lead to an increased number of stockholders to vote against the Business Combination or demand redemption of their shares, which could potentially impact dMY’s ability to consummate the Business Combination. For more information about our decision-making process, see the section entitled “The Business Combination Proposal — The Board’s Reasons for the Approval of the Business Combination.”

 

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If dMY’s stockholders fail to comply with the redemption requirements specified in this proxy statement, they will not be entitled to redeem their shares of Class A Common Stock for a pro rata portion of the trust account.

Holders of public shares are not required to affirmatively vote against the business combination proposal in order to exercise their rights to redeem their shares for a pro rata portion of the trust account. To exercise their redemption rights, they are required to submit a request in writing and deliver their stock (either physically or electronically) to dMY’s transfer agent by [•], 2020. Stockholders electing to redeem their shares will receive their pro rata portion of the trust account less taxes payable, calculated as of two business days prior to the anticipated consummation of the Business Combination.

The Company may redeem your unexpired warrants prior to their exercise at a time that is disadvantageous to you, thereby making your warrants worthless.

The Company will have the ability to redeem outstanding public warrants at any time after they become exercisable and prior to their expiration, at a price of $0.01 per warrant, provided that the closing price of the Class A Common Stock equals or exceeds $18.00 per share (as adjusted for share splits, share dividends, reorganizations, recapitalizations and the like) for any 20 trading days within a 30 trading-day period ending on the third trading day prior to proper notice of such redemption. If and when the warrants become redeemable by the Company, the Company may exercise its redemption right even if it is unable to register or qualify the underlying securities for sale under all applicable state securities laws. Redemption of the outstanding warrants could force holders (i) to exercise the warrants and pay the exercise price therefor at a time when it may be disadvantageous to do so, (ii) to sell the warrants at the then-current market price when the holder might otherwise wish to hold your warrants or (iii) to accept the nominal redemption price which, at the time the outstanding warrants are called for redemption, is likely to be substantially less than the market value of the warrants. The private placement warrants are not redeemable by the Company so long as they are held by the Sponsor or its permitted transferees.

The only principal asset of the Company following the Business Combination will be its interest in RSI (through the Company’s wholly-owned subsidiary), and accordingly it will depend on distributions from RSI to pay taxes and expenses.

Upon consummation of the Business Combination, the Company will be a holding company and will have no material assets other than its ownership of the Issued RSI Units (through its wholly-owned subsidiary, RSI ASLP, Inc., a Delaware corporation) and its ownership of all of the limited liability company interests of RSI GP. The Company is not expected to have independent means of generating revenue or cash flow, and its ability to pay its taxes, operating expenses, and pay any dividends in the future, if any, will be dependent upon the financial results and cash flows of RSI. There can be no assurance that RSI will generate sufficient cash flow to distribute funds to the Company or that applicable state law and contractual restrictions, including negative covenants under debt instruments will permit such distributions. If RSI does not distribute sufficient funds to the Company to pay its taxes or other liabilities, the Company may default on contractual obligations or have to borrow additional funds. In the event that the Company is required to borrow additional funds it could adversely affect our liquidity and subject us to additional restrictions imposed by lenders.

RSI will continue to be treated as a partnership for United States federal income tax purposes and, as such, generally will not be subject to any entity-level United States federal income tax. Instead, taxable income will be allocated, for United States federal income tax purposes, to the holders RSI Units, including the Special Limited Partner, which is a member of Company’s consolidated group for United States federal income tax purposes. Accordingly, the Company will be required to pay United States federal income taxes on the Special Limited Partner’s allocable share of the net taxable income of RSI. Under the terms of the RSI A&R LPA, RSI is obligated to make tax distributions to holders of RSI Units (including the Special Limited Partner) calculated at certain assumed rates. In addition to tax expenses, the Company and the Special Limited Partner will also incur

 

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expenses related to its operations, including payment obligations of the Special Limited Partner under the Tax Receivable Agreement, which could be significant and some of which will be reimbursed by RSI (excluding payment obligations under the Tax Receivable Agreement). The Special Limited Partner intends to cause RSI to make ordinary distributions and tax distributions to the holders of RSI Units on a pro rata basis in amounts sufficient to cover all applicable taxes, relevant operating expenses, payments under the Tax Receivable Agreement and dividends, if any, declared by the Company. However, as discussed below, RSI’s ability to make such distributions may be subject to various limitations and restrictions, including, but not limited to, retention of amounts necessary to satisfy the obligations of RSI and its subsidiaries and restrictions on distributions that would violate any applicable restrictions contained in RSI’s debt agreements, or any applicable law, or that would have the effect of rendering RSI insolvent. To the extent the Special Limited Partner is unable to make payments under the Tax Receivable Agreement for any reason, such payments will be deferred and will accrue interest until paid, provided, however, that nonpayment for a specified period and/or under certain circumstances may constitute a material breach of a material obligation under the Tax Receivable Agreement and therefore accelerate payments under the Tax Receivable Agreement, which could be substantial.

Additionally, although RSI generally will not be subject to any entity-level United States federal income tax, it may be liable under recent federal tax legislation for adjustments to its tax return, absent an election to the contrary. In the event RSI’s calculations of taxable income are incorrect, RSI and/or its members, including the Special Limited Partner, in later years may be subject to material liabilities pursuant to this federal legislation and its related guidance.

The Company anticipates that the distributions the Special Limited Partner will receive from RSI may, in certain periods, exceed the Company’s and the Special Limited Partner’s actual liabilities and the Special Limited Partner’s obligations to make payments under the Tax Receivable Agreement. The Board, in its sole discretion, will make any determination from time to time with respect to the use of any such excess cash so accumulated, which may include, among other uses, to pay dividends on the Company’s Class A Common Stock. The Company will have no obligation to distribute such cash (or other available cash other than any declared dividend) to its stockholders. The Company may, if necessary, undertake ameliorative actions, which may include pro rata or non-pro rata reclassifications, combinations, subdivisions or adjustments of outstanding RSI Units, to maintain one-for-one parity between RSI Units held by the Special Limited Partner and shares of Class A Common Stock of the Company.

Dividends on the Company’s common stock, if any, will be paid at the discretion of the Board, which will consider, among other things, the Company’s available cash, available borrowings and other funds legally available therefor, taking into account the retention of any amounts necessary to satisfy the obligations of the Company that will not be reimbursed by RSI, including taxes and amounts payable under the Tax Receivable Agreement and any restrictions in then applicable bank financing agreements. Financing arrangements may include restrictive covenants that restrict the Company’s ability to pay dividends or make other distributions to its stockholders. In addition, RSI is generally prohibited under Delaware law from making a distribution to a member to the extent that, at the time of the distribution, after giving effect to the distribution, liabilities of RSI (with certain exceptions) exceed the fair value of its assets. RSI’s subsidiaries are generally subject to similar legal limitations on their ability to make distributions to RSI. If RSI does not have sufficient funds to make distributions, the Company’s ability to declare and pay cash dividends may also be restricted or impaired.

 

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Pursuant to the Tax Receivable Agreement, the Special Limited Partner will be required to pay to Sellers and/or the exchanging holders of RSI Units, as applicable, 85% of the net income tax savings that the Company and its consolidated subsidiaries (including the Special Limited Partner) realizes as a result of increases in tax basis in RSI’s assets related to the transactions contemplated under the Business Combination Agreement and the future exchange of the Retained RSI Units for shares of Class A Common Stock (or cash) pursuant to the RSI A&R LPA and tax benefits related to entering into the Tax Receivable Agreement, including tax benefits attributable to payments under the Tax Receivable Agreement, and those payments may be substantial.

The Sellers will sell RSI Units for the Purchased Company Unit Closing Cash Consideration and may in the future exchange their RSI Units, together with the cancelation of an equal number of shares of Class V Voting Stock, for shares of Class A Common Stock of the Company (or cash) pursuant to the RSI A&R LPA, subject to certain conditions and transfer restrictions as set forth therein and in the Investor Rights Agreement. These sales and exchanges are expected to result in increases in the Special Limited Partner’s allocable share of the tax basis of the tangible and intangible assets of RSI. These increases in tax basis may increase (for income tax purposes) depreciation and amortization deductions and therefore reduce the amount of income or franchise tax that the Company and the Special Limited Partner would otherwise be required to pay in the future had such sales and exchanges never occurred.

In connection with the Business Combination, the Special Limited Partner will enter into the Tax Receivable Agreement, which generally provides for the payment by it of 85% of certain net tax benefits, if any, that the Company and its consolidated subsidiaries (including the Special Limited Partner) realizes (or in certain cases is deemed to realize) as a result of these increases in tax basis and tax benefits related to the transactions contemplated under the Business Combination Agreement and the exchange of Retained RSI Units for Class A Common Stock (or cash) pursuant to the RSI A&R LPA and tax benefits related to entering into the Tax Receivable Agreement, including tax benefits attributable to payments under the Tax Receivable Agreement. These payments are the obligation of the Special Limited Partner and not of RSI. The actual increase in the Special Limited Partner’s allocable share of RSI’s tax basis in its assets, as well as the amount and timing of any payments under the Tax Receivable Agreement, will vary depending upon a number of factors, including the timing of exchanges, the market price of the Class A Common Stock at the time of the exchange and the amount and timing of the recognition of the Company’s and its consolidated subsidiaries’ (including the Special Limited Partner’s) income. While many of the factors that will determine the amount of payments that the Special Limited Partner will make under the Tax Receivable Agreement are outside of its control, the Company expects that the payments the Special Limited Partner will make under the Tax Receivable Agreement will be substantial and could have a material adverse effect on the Company’s financial condition.

Any payments made by the Special Limited Partner under the Tax Receivable Agreement will generally reduce the amount of overall cash flow that might have otherwise been available to the Company. To the extent that the Special Limited Partner is unable to make timely payments under the Tax Receivable Agreement for any reason, the unpaid amounts will be deferred and will accrue interest until paid; however, nonpayment for a specified period and/or under certain circumstances may constitute a material breach of a material obligation under the Tax Receivable Agreement and therefore accelerate payments due under the Tax Receivable Agreement, as further described below. Furthermore, the Special Limited Partner’s future obligation to make payments under the Tax Receivable Agreement could make it a less attractive target for an acquisition, particularly in the case of an acquirer that cannot use some or all of the tax benefits that may be deemed realized under the Tax Receivable Agreement. See the section entitled “The Business Combination Proposal — Related Agreements — Tax Receivable Agreement.”

In certain cases, payments under the Tax Receivable Agreement may exceed the actual tax benefits the Company and its consolidated subsidiaries (including the Special Limited Partner) realizes or be accelerated.

Payments under the Tax Receivable Agreement will be based on the tax reporting positions that the Company and its consolidated subsidiaries (including the Special Limited Partner) determines, and the IRS or

 

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another taxing authority may challenge all or any part of the tax basis increases, as well as other tax positions that the Company and its consolidated subsidiaries (including the Special Limited Partner) takes, and a court may sustain such a challenge. In the event that any tax benefits initially claimed by the Company or its consolidated subsidiaries (including the Special Limited Partner) are disallowed, the Sellers and the exchanging holders will not be required to reimburse the Special Limited Partner for any excess payments that may previously have been made under the Tax Receivable Agreement, for example, due to adjustments resulting from examinations by taxing authorities. Rather, excess payments made to such holders will be applied against and reduce any future cash payments otherwise required to be made by the Special Limited Partner, if any, after the determination of such excess. However, a challenge to any tax benefits initially claimed by the Company and its consolidated subsidiaries (including the Special Limited Partner) may not arise for a number of years following the initial time of such payment and, even if challenged earlier, such excess cash payment may be greater than the amount of future cash payments that the Company and its consolidated subsidiaries (including the Special Limited Partner) might otherwise be required to make under the terms of the Tax Receivable Agreement and, as a result, there might not be future cash payments against which such excess can be applied. As a result, in certain circumstances the Special Limited Partner could make payments under the Tax Receivable Agreement in excess of the Company’s and its consolidated subsidiaries’ (including the Special Limited Partner’s) actual income or franchise tax savings, which could materially impair the Company’s and its consolidated subsidiaries’ (including the Special Limited Partner’s) financial condition.

Moreover, the Tax Receivable Agreement provides that, in the event that (i) the Special Limited Partner exercises its early termination rights under the Tax Receivable Agreement, (ii) certain changes of control of the Company, the Special Limited Partner or RSI occur (as described in the RSI A&R LPA), (iii) the Special Limited Partner in certain circumstances, fails to make a payment required to be made pursuant to the Tax Receivable Agreement by its final payment date, which non-payment continues for 30 days following such final payment date or (iv) the Company or the Special Limited Partner materially breaches any of its material obligations under the Tax Receivable Agreement other than as described in the foregoing clause (iii), which breach continues without cure for 30 days following receipt by the Company and/or the Special Limited Partner of written notice thereof and written notice of acceleration is received by the Company and/or the Special Limited Partner thereafter (except that in the case that the Tax Receivable Agreement is rejected in a case commenced under bankruptcy laws, no written notice of acceleration is required), in the case of clauses (iii) and (iv), unless certain liquidity exceptions apply, the Special Limited Partner’s obligations under the Tax Receivable Agreement will accelerate and the Special Limited Partner will be required to make a lump-sum cash payment to the Sellers and/or other applicable parties to the Tax Receivable Agreement equal to the present value of all forecasted future payments that would have otherwise been made under the Tax Receivable Agreement, which lump-sum payment would be based on certain assumptions, including those relating to the Company’s and its consolidated subsidiaries’ (including the Special Limited Partner’) future taxable income. The lump-sum payment could be substantial and could exceed the actual tax benefits that the Company and its consolidated subsidiaries (including the Special Limited Partner) realizes subsequent to such payment because such payment would be calculated assuming, among other things, that the Company and its consolidated subsidiaries (including the Special Limited Partner) would have certain assumed tax benefits available to it and that the Company and its consolidated subsidiaries (including the Special Limited Partner) would be able to use the assumed and potential tax benefits in future years.

There may be a material negative effect on the Company’s liquidity if the payments under the Tax Receivable Agreement exceed the actual income or franchise tax savings that the Company and its consolidated subsidiaries (including the Special Limited Partner) realize. Furthermore, the Special Limited Partner’s obligations to make payments under the Tax Receivable Agreement could also have the effect of delaying, deferring or preventing certain mergers, asset sales, other forms of business combinations or other changes of control.

 

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Increases in the Company’s income tax rates, changes in income tax laws or disagreements with tax authorities can adversely affect the Company’s business, financial condition or results of operations.

Increases in the Company’s income tax rates or other changes in income tax laws in the United States or any particular jurisdiction in which the Company operates could reduce its after-tax income from such jurisdiction and adversely affect its business, financial condition or results of operations. Existing tax laws in the United States have been and could in the future be subject to significant change. For example, in December 2017, the TCJA was signed into law in the United States which provided for significant changes to then-existing tax laws and additional guidance issued by the Internal Revenue Service (“IRS”) pursuant to the TCJA may continue to impact the Company in future periods. Additional changes in the United States tax regime, including changes in how existing tax laws are interpreted or enforced, can adversely affect the Company’s business, financial condition or results of operations.

The Company will also be subject to regular reviews, examinations and audits by the IRS and other taxing authorities with respect to income and non-income-based taxes. Economic and political pressures to increase tax revenues in jurisdictions in which the Company operates, or the adoption of new or reformed tax legislation or regulation, may make resolving tax disputes more difficult and the final resolution of tax audits and any related litigation can differ from the Company’s historical provisions and accruals, resulting in an adverse impact on the Company’s business, financial condition or results of operations.

If the benefits of the Business Combination do not meet the expectations of investors or securities analysts, the market price of the Company’s securities may decline.

If the benefits of the Business Combination do not meet the expectations of investors or securities analysts, the market price of dMY’s securities prior to the Closing may decline. The market values of dMY’s securities at the time of the Business Combination may vary significantly from their prices on the date the Business Combination Agreement was executed, the date of this proxy statement, or the date on which our stockholders vote on the Business Combination. Because the number of shares to be issued pursuant to the Business Combination Agreement will not be adjusted to reflect any changes in the market price of dMY’s Class A Common Stock, the market value of common stock issued in the Business Combination may be higher or lower than the values of these shares on earlier dates.

In addition, following the Business Combination, fluctuations in the price of the Company’s securities could contribute to the loss of all or part of your investment. Prior to the Business Combination, there has not been a public market for the stock of the Company and trading in shares of Class A Common Stock has not been active. Accordingly, the valuation ascribed to the Company in the Business Combination may not be indicative of the price that will prevail in the trading market following the Business Combination. If an active market for the Company’s securities develops and continues, the trading price of its securities following the Business Combination could be volatile and subject to wide fluctuations in response to various factors, some of which are beyond the Company’s control. Any of the factors listed below could have a material adverse effect on your investment in the Company’s securities and the Company’s securities may trade at prices significantly below the price you paid for them. In such circumstances, the trading price of the Company’s securities may not recover and may experience a further decline.

Factors affecting the trading price of the Company’s securities may include:

 

   

actual or anticipated fluctuations in its quarterly financial results or the quarterly financial results of companies perceived to be similar to it;

 

   

changes in the market’s expectations about the Company’s operating results;

 

   

success of competitors;

 

   

the Company’s operating results failing to meet the expectation of securities analysts or investors in a particular period;

 

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changes in financial estimates and recommendations by securities analysts concerning the Company or the industries in which the Company operates in general;

 

   

operating and stock price performance of other companies that investors deem comparable to the Company;

 

   

the Company’s ability to market new and enhanced products on a timely basis;

 

   

changes in laws and regulations affecting the Company’s business;

 

   

commencement of, or involvement in, litigation involving the Company;

 

   

changes in the Company’s capital structure, such as future issuances of securities or the incurrence of additional debt;

 

   

the volume of shares of the Company’s Class A Common Stock available for public sale;

 

   

any major change in the Company’s Board or management;

 

   

sales of substantial amounts of Class A Common Stock by our directors, executive officers or significant stockholders or the perception that such sales could occur; and

 

   

general economic and political conditions such as recessions, interest rates, fuel prices, international currency fluctuations and acts of war or terrorism.

Broad market and industry factors may materially harm the market price of the Company’s securities irrespective of the Company’s operating performance. The stock market in general, and the NYSE, have experienced price and volume fluctuations that have often been unrelated or disproportionate to the operating performance of the particular companies affected. The trading prices and valuations of these stocks, and of the Company’s securities, may not be predictable. A loss of investor confidence in the market for the stocks of other companies that investors perceive to be similar to the Company could depress the Company’s stock price regardless of its business, prospects, financial conditions, or results of operations. A decline in the market price of the Company’s securities also could adversely affect its ability to issue additional securities and its ability to obtain additional financing in the future.

dMY’s initial stockholders, directors, officers, advisors and their affiliates may elect to purchase shares or public warrants from public stockholders or public warrant holders, which may influence a vote on the Business Combination and reduce the public “float” of our Class A Common Stock.

dMY’s initial stockholders, directors, officers, advisors or their affiliates may purchase shares or public warrants in privately negotiated transactions or in the open market either before or following the completion of the Business Combination, although they are under no obligation to do so. There is no limit on the number of shares dMY’s initial stockholders, directors, officers, advisors, or their affiliates may purchase in such transactions, subject to compliance with applicable law and the rules of the NYSE. However, other than as expressly stated herein, they have no current commitments, plans or intentions to engage in such transactions and have not formulated any terms or conditions for any such transactions. None of the funds in the trust account will be used to purchase shares or public warrants in such transactions.

In the event that dMY’s initial stockholders, directors, executive officers, advisors, or their affiliates purchase shares in privately negotiated transactions from public stockholders who have already elected to exercise their redemption rights, such selling stockholders would be required to revoke their prior elections to redeem their shares. The purpose of any such purchases of shares could be to vote such shares in favor of the Business Combination and thereby increase the likelihood of obtaining stockholder approval of the Business Combination or to satisfy a closing condition in the Business Combination Agreement that requires us to have a certain amount of cash at the Closing, where it appears that such requirement would otherwise not be met. In addition, the purpose of any such purchases of public warrants could be to reduce the number of public warrants

 

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outstanding or to vote such warrants on any matters submitted to the warrant holders for approval in connection with the initial Business Combination. Any such purchases of our securities may result in the completion of the Business Combination that may not otherwise have been possible.

In addition, if such purchases are made, the public “float” of our Class A Common Stock and the number of beneficial holders of our securities may be reduced, possibly making it difficult to maintain or obtain the quotation, listing, or trading of our securities on a national securities exchange.

dMY’s initial stockholders have agreed to vote in favor of the Business Combination, regardless of how our public stockholders vote.

dMY’s initial stockholders have agreed to vote their founder shares, private placement shares as well as any public shares purchased during or after dMY’s IPO, in favor of the Business Combination. As of the date hereof, the initial stockholders own approximately 20% of dMY’s outstanding shares. Accordingly, it is more likely that the necessary stockholder approval for the Business Combination will be received than would be the case if dMY’s initial stockholders agreed to vote their founder shares and private placement shares in accordance with the majority of the votes cast by dMY’s public stockholders.

Even if the Business Combination is consummated, the warrants may not be in the money at the time they become exercisable, and they may expire worthless.

The exercise price for the outstanding warrants is $11.50 per share of common stock. There can be no assurance that the warrants will be in the money following the time they become exercisable and prior to their expiration, and as such, the warrants may expire worthless.

If dMY is unable to complete the Business Combination with RSI or another business combination by February 25, 2022 (or such later date as its stockholders may approve), dMY will cease all operations except for the purpose of winding up, dissolving and liquidating. In connection with winding up, dMY would redeem its public shares and liquidate the trust account in which case, its public shareholders may only receive approximately $10.00 per share and their warrants will expire worthless. In addition, third-parties may bring claims against dMY and, as a result, the proceeds held in the trust account could be reduced, and the per share liquidation price received by stockholders could be less than $10.00 per share.

Under the terms of the Charter, dMY must complete the Business Combination with RSI or another business combination by February 25, 2022 (or such later date as dMY’s stockholders may approve), or dMY must (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten 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 earned on the trust account deposits (which interest will be net of taxes payable and less up to $100,000 to pay dissolution expenses), divided by the number of then-outstanding public shares, which redemption will completely extinguish dMY’s public stockholders’ rights as stockholders (including the right to receive further liquidation distributions, if any), subject to applicable law; and (iii) as promptly as reasonably possible following such redemption, subject to the approval of dMY’s remaining stockholders and our Board, dissolve and liquidate, subject in each case to our obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law. There will be no liquidating distributions with respect to our warrants, which will expire worthless.

In connection with dMY’s redemption of 100% of the outstanding public shares and, subject to the approval of dMY’s remaining stockholders and its Board, dissolving and liquidating, third-parties may bring claims against dMY. Although dMY has obtained waiver agreements from certain vendors and service providers (other than its independent auditors) it has engaged and owes money to, and the prospective target businesses dMY has negotiated with, whereby such parties have waived any right, title, interest or claim of any kind they may have in or to any monies held in the trust account, there is no guarantee that they or other vendors who did not execute

 

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such waivers will not seek recourse against the trust account notwithstanding such agreements. Furthermore, there is no guarantee that a court will uphold the validity of such agreements. Accordingly, the proceeds held in the trust account could be subject to claims that could take priority over those of dMY’s public stockholders.

The Sponsor has agreed that it will be liable to dMY, if and to the extent any claims by a third-party (other than dMY’s independent registered public accounting firm) for services rendered or products sold to dMY, or a prospective target business with which dMY has entered into a written letter of intent, confidentiality or other similar agreement or business combination agreement, reduce the amount of funds in the trust account to below: (i) $10.00 per public share; or (ii) such lesser amount per public share held in the trust account as of the date of the liquidation of the trust account due to reductions in the value of the trust assets, in each case net of the interest which may be withdrawn to pay taxes, and up to $100,000 for dissolution expenses, except as to any claims by a third-party who executed a waiver of any and all rights to seek access to the trust account and except as to any claims under dMY’s indemnity of the underwriters of its IPO against certain liabilities, including liabilities under the Securities Act. Moreover, in the event that an executed waiver is deemed to be unenforceable against a third-party, the Sponsor will not be responsible to the extent of any liability for such third-party claims. dMY has not asked the Sponsor to reserve for its indemnification obligations, dMY has not independently verified whether the Sponsor has sufficient funds to satisfy such obligations, and dMY believes that the Sponsor’s only assets are securities of dMY. As a result, if any such claims were successfully made against the trust account, the funds available for dMY’s initial Business Combination and redemptions could be reduced to less than $10.00 per public share. In such event, dMY may not be able to complete its initial Business Combination, and you would receive such lesser amount per share in connection with any redemption of your public shares.

dMY’s directors may decide not to enforce the indemnification obligations of the Sponsor, resulting in a reduction in the amount of funds in the trust account available for distribution to dMY’s public stockholders.

In the event that the proceeds in the trust account are reduced below the lesser of (i) $10.00 per public share; or (ii) such lesser amount per public share held in the trust account as of the date of the liquidation of the trust account due to reductions in the value of the trust assets, in each case net of the interest which may be withdrawn to pay taxes, and up to $100,000 for dissolution expenses, and the Sponsor asserts that it is unable to satisfy its obligations or that it has no indemnification obligations related to a particular claim, dMY’s independent directors would determine whether to take legal action against the Sponsor to enforce its indemnification obligations.

While dMY currently expects that its independent directors would take legal action on its behalf against the Sponsor to enforce its indemnification obligations to dMY, it is possible that dMY’s independent directors in exercising their business judgment and subject to their fiduciary duties may choose not to do so in any particular instance. If dMY’s independent directors choose not to enforce these indemnification obligations, the amount of funds in the trust account available for distribution to dMY’s public stockholders may be reduced below $10.00 per share.

If, before distributing the proceeds in the trust account to its public stockholders, dMY files a bankruptcy petition or an involuntary bankruptcy petition is filed against dMY that is not dismissed, the claims of creditors in such proceeding may have priority over the claims of dMY’s stockholders and the per share amount that would otherwise be received by dMY’s stockholders in connection with our liquidation may be reduced.

If, before distributing the proceeds in the trust account to its public stockholders, dMY files a bankruptcy petition or an involuntary bankruptcy petition is filed against dMY that is not dismissed, the proceeds held in the trust account could be subject to applicable bankruptcy law, and may be included in dMY’s bankruptcy estate and subject to the claims of third-parties with priority over the claims of dMY’s stockholders. To the extent any bankruptcy claims deplete the trust account, the per share amount that would otherwise be received by dMY’s stockholders in connection with our liquidation may be reduced.

 

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dMY’s stockholders may be held liable for claims by third-parties against dMY to the extent of distributions received by them.

If dMY is unable to complete the Business Combination with RSI or another business combination within the required time period, dMY will cease all operations except for the purpose of winding up, liquidating and dissolving, subject to its obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law. dMY cannot assure you that it will properly assess all claims that may be potentially brought against it. As such, dMY’s stockholders could potentially be liable for any claims to the extent of distributions received by them (but no more) and any liability of dMY’s stockholders may extend well beyond the third anniversary of the date of distribution. Accordingly, dMY cannot assure you that third-parties will not seek to recover from its stockholders amounts owed to them by dMY.

If dMY is forced to file a bankruptcy case or an involuntary bankruptcy case is filed against dMY which is not dismissed, any distributions received by stockholders could be viewed under applicable debtor/creditor and/or bankruptcy laws as either a “preferential transfer” or a “fraudulent conveyance.” As a result, a bankruptcy court could seek to recover all amounts received by dMY’s stockholders. Furthermore, because dMY intends to distribute the proceeds held in the trust account to its public stockholders promptly after the expiration of the time period to complete an initial business combination, this may be viewed or interpreted as giving preference to its public stockholders over any potential creditors with respect to access to or distributions from its assets. Furthermore, the Board may be viewed as having breached its fiduciary duties to dMY’s creditors and/or may have acted in bad faith, and thereby exposing itself and the Company to claims of punitive damages, by paying public stockholders from the trust account before addressing the claims of creditors. dMY cannot assure you that claims will not be brought against it for these reasons.

The ability of stockholders to exercise redemption rights with respect to a large number of shares of Class A Common Stock could increase the probability that the Business Combination would be unsuccessful and that stockholders would have to wait for liquidation to redeem their stock.

At the time dMY entered into the agreements for the Business Combination it did not know how many stockholders would exercise their redemption rights, and therefore dMY structured the Business Combination based on its expectations as to the number of shares of Class A Common Stock that will be submitted for redemption. If a larger number of such shares are submitted for redemption than dMY initially expected, this could lead to a failure to consummate the Business Combination, a failure to obtain or maintain the listing of dMY’s securities on the NYSE or another national securities exchange, or a lack of liquidity, which could impair the Company’s ability to fund its operations and adversely affect its business, financial condition and results of operations.

The unaudited pro forma condensed combined financial information included in this proxy statement may not be indicative of what the Company’s actual financial position or results of operations would have been.

The unaudited pro forma condensed combined financial information in this proxy statement is presented for illustrative purposes only and is not necessarily indicative of what the Company’s actual financial position or results of operations would have been had the Business Combination been completed on the dates indicated. See the section entitled “Unaudited Pro Forma Condensed Combined Financial Information” for more information.

The Business Combination is subject to conditions, including certain conditions that may not be satisfied on a timely basis, if at all.

The completion of the Business Combination is subject to a number of conditions. The completion of the Business Combination is not assured and is subject to risks, including the risk that (i) approval of the Business Combination by dMY’s stockholders is not obtained, (ii) that there are not sufficient funds in the trust account, (iii) that the Company does not have Available Closing Date Cash of at least $160,000,000 minus the amount by

 

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which the transaction expenses incurred by RSI and the Sellers exceeds $12,500,000 and (iv) that all approvals, determinations, grants, confirmations and other conditions with respect to gaming regulatory authorities in connection with the transactions contemplated by the Business Combination Agreement and the related agreements are not made, obtained, satisfied or given or in full force and effect, in each case subject to certain terms specified in the Business Combination Agreement (as described under see “The Business Combination Proposal — The Business Combination Agreement — Conditions to the Closing of the Business Combination.”), or that other closing conditions are not satisfied. If dMY does not complete the Business Combination, ite could be subject to several risks, including:

 

   

the parties may be liable for damages to one another for breach under the terms and conditions of the Business Combination Agreement;

 

   

negative reactions from the financial markets, including declines in the price of dMY’s shares due to the fact that current prices may reflect a market assumption that the Business Combination will be completed; and

 

   

the attention of dMY’s management will have been diverted to the Business Combination rather than dMY’s own operations and pursuit of other opportunities that could have been beneficial to that organization.

There can be no assurance that the Company will be able to comply with the continued listing standards of the NYSE.

The Company’s continued eligibility for listing on the NYSE depends on a number of factors, including the number of dMY shares that are redeemed in connection with the vote at the special meeting to approve the Business Combination and the Company having a minimum level of stockholders’ equity following the Closing, among meeting other listing standards. If, after the Business Combination, the NYSE delists the Class A Common Stock from trading on its exchange for failure to meet the listing standards, the Company and its stockholders could face significant material adverse consequences including:

 

   

a limited availability of market quotations for our securities;

 

   

a determination that our Class A Common Stock is a “penny stock,” which will require brokers trading in our Class A Common Stock to adhere to more stringent rules, possibly resulting in a reduced level of trading activity in the secondary trading market for our Class A Common Stock ;

 

   

a limited amount of analyst coverage; and

 

   

a decreased ability to issue additional securities or obtain additional financing in the future.

The Exclusive Forum Provision in our Proposed Charter may have the effect of discouraging lawsuits against our directors and officers.

The Proposed Charter will require, unless we consent in writing to the selection of an alternative forum, that (i) any derivative action or proceeding brought on our behalf, (ii) any action asserting a claim of breach of a fiduciary duty owed by any director, officer, other employee or Company stockholder to us or to our stockholders, (iii) any action asserting a claim against us, our directors, officers, other employees or Company stockholders arising pursuant to any provision of the DGCL, the Proposed Charter or our bylaws, or (iv) any action asserting a claim against us, our directors, officers, other employees or Company stockholders governed by the internal affairs doctrine under Delaware law shall be brought, to the fullest extent permitted by law, solely and exclusively in the Court of Chancery in the State of Delaware; provided, however, that, in the event that the Court of Chancery in the State of Delaware lacks subject matter jurisdiction over any such actions, the Proposed Charter provides that the sole and exclusive forum shall be another state or federal court located within the State of Delaware, in each such case, unless the Court of Chancery (or such other state or federal court located within the State of Delaware, as applicable) has dismissed a prior action by the same plaintiff asserting the same claims because such court lacked personal jurisdiction over an indispensable party named as a defendant.

 

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In addition, the Proposed Charter will require, unless we consent in writing to the selection of an alternative forum, that the federal district courts of the United States of America shall, to the fullest extent permitted by law, be the sole and exclusive forum for the resolution of any complaint asserting a cause of action arising under the Securities Act of 1933, as amended. This provision in the Proposed Charter will not address or apply to claims that arise under the Exchange Act; however, Section 27 of the Exchange Act creates exclusive federal jurisdiction over all suits brought to enforce any duty or liability created by the Exchange Act or the rules and regulations thereunder.

Although we believe this provision benefits us by providing increased consistency in the application of law in the types of lawsuits to which it applies, a court may determine that this provision is unenforceable, and to the extent it is enforceable, the provision may have the effect of discouraging lawsuits against our directors and officers.

Provisions in the Proposed Charter may inhibit a takeover of the Company, which could limit the price investors might be willing to pay in the future for Class A Common Stock and could entrench management.

The Proposed Charter will contain provisions that may discourage unsolicited takeover proposals that stockholders may consider to be in their best interests. These provisions include a staggered Board, the controlling provisions of the Investor Rights Agreement, a supermajority vote required to amend certain provisions of the Proposed Charter and the ability of the Board to designate the terms of, and issue new series of, preferred stock, which may make more difficult the removal of management and may discourage transactions that otherwise could involve payment of a premium over prevailing market prices for our securities.

General Risk Factors

Economic downturns and political and market conditions beyond our control, including a reduction in consumer discretionary spending, could adversely affect our business, financial condition, results of operations and prospects.

Our financial performance is subject to global and United States economic conditions and their impact on levels of spending by users. Economic recessions have had, and may continue to have, far reaching adverse consequences across many industries, including the global entertainment and gaming industries, which may adversely affect our business, financial condition, results of operations and prospects. We are currently experiencing a global recession as a result of the COVID-19 pandemic, and if recovery is slow or stalls, or we experience a further downturn as a result of a second wave of the COVID-19 pandemic, we may experience a material adverse effect on our business, financial condition, results of operations or prospects. The ultimate severity of the coronavirus outbreak is uncertain at this time and therefore we cannot predict the full impact it may have on our end markets and our operations; however, the effect on our business, financial condition, results of operations and prospects could be material and adverse.

Consumer discretionary spending or consumer preferences are driven by socioeconomic factors beyond our control, and our business is sensitive to reductions from time to time in discretionary consumer spending. Demand for entertainment and leisure activities, including gaming, can be affected by changes in the economy and consumer tastes, both of which are difficult to predict and beyond our control. Unfavorable changes in general economic conditions, including recessions, economic slowdowns, sustained high levels of unemployment, and rising prices or the perception by consumers of weak or weakening economic conditions, may reduce our users’ disposable income or result in fewer individuals engaging in entertainment and leisure activities, such as online casino wagering and retail or online sports wagering. As a result, we cannot ensure that demand for our offerings will remain constant. Adverse developments affecting economies throughout the world, including a general tightening of availability of credit, decreased liquidity in certain financial markets, increased interest rates, foreign exchange fluctuations, increased energy costs, acts of war or terrorism, transportation disruptions, natural disasters, declining consumer confidence, sustained high levels of unemployment or

 

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significant declines in stock markets, as well as concerns regarding pandemics, epidemics and the spread of contagious diseases, could lead to a further reduction in discretionary spending on leisure activities, such as online casino wagering and retail or online sports wagering.

RSI may be subject to litigation in the operation of our business. An adverse outcome in one or more proceedings could adversely affect our business.

As a growing company with expanding operations, RSI may in the future increasingly face the risk of, claims, lawsuits, and other proceedings involving competition and antitrust, intellectual property, privacy, consumer protection, accessibility claims, securities, tax, labor and employment, commercial disputes, services and other matters. Litigation to defend us against claims by third parties, or to enforce any rights that we may have against third parties, may be necessary, which could result in substantial costs and diversion of our resources, causing a material adverse effect on our business, financial condition, results of operations and prospects.

Any litigation to which RSI is a party may result in an onerous or unfavorable judgment that may not be reversed upon appeal, or in payments of substantial monetary damages or fines, the posting of bonds requiring significant collateral, letters of credit or similar instruments, or RSI may decide to settle lawsuits on similarly unfavorable terms. These proceedings could also result in reputational harm, criminal sanctions, consent decrees or orders preventing RSI from offering certain products or requiring a change in its business practices in costly ways or requiring development of non-infringing or otherwise altered products or technologies. Litigation and other claims and regulatory proceedings against RSI could result in unexpected disciplinary actions, expenses and liabilities, which could have a material adverse effect on its business, financial condition, results of operations and prospects.

RSI could be subject to future governmental investigations and inquiries, legal proceedings and enforcement actions. Any such investigation, inquiry, proceeding or action, could adversely affect our business.

RSI has received formal and informal inquiries from time to time, from government authorities and regulators, and gaming regulators, regarding compliance with laws and other matters, and we may receive such inquiries in the future, particularly as we grow and expand our operations. Violation of existing or future regulations, regulatory orders or consent decrees could subject us to substantial monetary fines and other penalties that could adversely affect our business, financial condition, results of operations and prospects. In addition, it is possible that future orders issued by, or inquiries or enforcement actions initiated by, government or regulatory authorities could cause us to incur substantial costs, expose us to unanticipated liability or penalties, or require us to change our business practices in a manner materially adverse to our business, financial condition, results of operations and prospects.

Our insurance may not provide adequate levels of coverage against claims.

We intend to maintain insurance that we believe is customary for businesses of our size and type. However, there are types of losses we may incur that cannot be insured against or that we believe are not economically reasonable to insure. Moreover, any loss incurred could exceed policy limits and policy payments made to us may not be made on a timely basis. Such losses could adversely affect our business, financial condition, results of operations and prospects.

Our growth prospects and market potential will depend on our ability to obtain licenses to operate in a number of jurisdictions and if we fail to obtain such licenses our business, financial condition, results of operations and prospects could be impaired.

Our ability to grow our business will depend on our ability to obtain and maintain licenses to offer our product offerings in a large number of jurisdictions or in heavily populated jurisdictions. If we fail to obtain and

 

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maintain licenses in large jurisdictions or in a greater number of mid-market jurisdictions, this may prevent us from expanding the footprint of our product offerings, increasing our user base and/or generating revenues. We cannot be certain that we will be able to obtain and maintain licenses and related approvals necessary to conduct our online casino and retail and online sports wagering operations. Any failure to obtain and maintain licenses, registrations, permits or approvals could have a material adverse effect on our business, financial condition, results of operations and prospects.

We may have difficulty accessing the service of banks, credit card issuers and payment processing services providers, which may make it difficult to sell our products and services.

Although financial institutions and payment processors are permitted to provide services to us and others in our industry, banks, credit card issuers and payment processing service providers may be hesitant to offer banking and payment processing services to real money gaming businesses. Consequently, those businesses involved in our industry, including RSI, may encounter difficulties in establishing and maintaining banking and payment processing relationships with a full scope of services and generating market rate interest. If we were unable to maintain RSI’s bank accounts or our users were unable to use their credit cards, bank accounts or e-wallets to make deposits and withdrawals from our platforms it would make it difficult for us to operate our business, increase our operating costs, and pose additional operational, logistical and security challenges which could result in an inability to implement our business plan.

 

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UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION

The following unaudited pro forma condensed combined financial information presents the combination of the financial information of dMY and RSI, adjusted to give effect to the Business Combination and related transactions. The following unaudited pro forma condensed combined financial information has been prepared in accordance with Article 11 of Regulation S-X.

The unaudited pro forma condensed combined balance sheet as of September 30, 2020 combines the historical balance sheet of dMY and the historical balance sheet of RSI on a pro forma basis as if the Business Combination and related transactions, summarized below, had been consummated on September 30, 2020. The unaudited pro forma condensed combined statements of operations for the year ended December 31, 2019 and the nine months ended September 30, 2020, combine the historical statements of operations of dMY and historical statements of operations of RSI for such periods on a pro forma basis as if the Business Combination and related transactions, summarized below, had been consummated on January 1, 2019, the beginning of the earliest period presented:

 

   

the Business Combination; and

 

   

the issuance and sale of 16,043,002 shares of dMY Class A Common Stock for a purchase price of $10.00 per share and an aggregate purchase price of $160.4 million in the PIPE pursuant to the Subscription Agreements.

The historical financial statements have been adjusted in the unaudited pro forma condensed combined financial statements to give pro forma effect to events that are: (i) directly attributable to the Business Combination; (ii) factually supportable; and (iii) with respect to the statements of operations, expected to have a continuing impact on the post-combination company’s results following the completion of the Business Combination.

The unaudited pro forma condensed combined financial statements have been developed from and should be read in conjunction with:

 

   

the accompanying notes to the unaudited pro forma condensed combined financial statements;

 

   

the historical audited financial statements of dMY as of December 31, 2019 and for the period from September 27, 2019 (inception) through December 31, 2019 and the related notes, found elsewhere in this proxy statement;

 

   

the historical audited consolidated financial statements of RSI as of and for the year ended December 31, 2019 and the related notes, found elsewhere in this proxy statement;

 

   

the historical unaudited financial statements of dMY as of and for the nine months ended September 30, 2020 and the related notes, found elsewhere in this proxy statement;

 

   

the historical unaudited consolidated financial statements of RSI as of and for the nine months ended September 30, 2020 and the related notes, found elsewhere in this proxy statement;

 

   

other information relating to dMY and RSI contained in the proxy statement, including the Business Combination Agreement and the description of certain terms thereof set forth in the section entitled “The Business Combination.”

Pursuant to dMY’s existing amended and restated certificate of incorporation, dMY’s public stockholders are being offered the opportunity to redeem, upon the closing of the Business Combination, shares of Class A Common Stock then held by them for cash equal to their pro rata share of the aggregate amount on deposit (as of two business days prior to the Closing) in the Trust Account (as defined in the proxy statement). For illustrative purposes, based on the cash held in the Trust Account as of September 30, 2020 of approximately $230.8 million, the estimated per share redemption price would have been approximately $10.00 per share.

 

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Notwithstanding the legal form of the Business Combination pursuant to the Business Combination Agreement, the Business Combination will be accounted for as a reverse recapitalization in accordance with GAAP. Under this method of accounting, dMY is treated as the acquired company and RSI is treated as the acquirer for financial statement reporting purposes. RSI has been determined to be the accounting acquirer based on evaluation of the following facts and circumstances:

 

   

RSI’s existing shareholders, through their ownership of the Class V Voting Stock, will have the greatest voting interest in the combined entity under the no and maximum redemption scenarios with over 75% of the voting interest in each scenario;

 

   

RSI’s directors will represent the majority of the new board of directors of the combined company;

 

   

RSI’s senior management will be the senior management of the combined company; and

 

   

RSI is the larger entity based on historical operating activity and has the larger employee base.

The unaudited pro forma condensed combined financial statements present two redemption scenarios as follows:

 

   

Assuming No Redemptions — This scenario assumes that (i) none of the holders of public shares of Class A Common Stock exercise their redemption rights, (ii) the parties to the Business Combination Agreement incur $30 million of transaction expenses, (iii) the Put-Calls are in effect as of the Closing and are validly exercised shortly following the Closing or are not in effect, (iv) the maximum amount of Purchased RSI Units are purchased from the Sellers (other than the Put-Call Sellers) (i.e., $99,235,500 if the Put-Calls are in effect or $125,000,000 if the Put-Calls are not in effect) at Closing, (v) none of the 1,205,937 Founder Holders Forfeiture Shares are forfeited because the Available Closing Date Cash exceeds $245,000,000, (vi) the Earnout Shares are excluded unless and until such shares become earned in accordance with the Business Combination Agreement, (vii) there is no exercise at the Closing of the Sponsor’s 6,600,000 private placement warrants at an exercise price of $11.50 per share (which warrants are not exercisable until the later of 12 months from the closing of the IPO and 30 days after the completion of the Business Combination), (viii) none of the parties set forth above purchase shares of Class A Common Stock in the open market, (ix) there are no other issuances of equity interests of the Company prior to or in connection with the Closing and (x) there are no issuances of any shares of the Company’s Class A Common Stock within the five business days following the Closing to additional private placement investors or following the Closing under the Plan; and

 

   

Assuming Maximum Redemptions — This scenario assumes that approximately 87% of dMY’s public stockholders exercise redemption rights with respect to their public shares (representing the maximum amount of public shares that can be redeemed to satisfy the Minimum Cash Condition). This scenario assumes that 20,043,002 public shares are redeemed for an aggregate redemption payment of approximately $200,430,020, based on $230.8 million in the trust and 23,000,000 public shares outstanding as of September 30, 2020. In accordance with the Charter, a public stockholder, together with any affiliate of his or hers, or any other person with whom he or she is acting in concert or as a “group” (as defined in Section 13(d)(3) of the Exchange Act) will be restricted from redemption with respect to 20% or more of public shares without the Company’s prior written consent. In no event will the Company redeem the public shares in an amount that would cause its net tangible assets to be less than $5,000,001.

Description of the Business Combination

On July 27, 2020, dMY and RSI entered into the Business Combination Agreement pursuant to which the Sellers will receive a combination of cash and shares of non-economic Class V Voting Stock equal to the number of Retained RSI Units (net of the number of Purchased RSI Units), and will retain approximately 76.9% of the economic interests in the post-combination combined company through the Retained RSI Units, assuming no redemptions (87.6% of the economic interests assuming maximum redemptions). On October 9, 2020, the parties

 

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amended and restated the Business Combination Agreement. On December 4, 2020, the parties further amended the Business Combination Agreement. Following the Closing, the combined company will be organized in an umbrella partnership–C corporation (“Up-C”) structure, in which substantially all of the assets of the combined company will be held by RSI, and the Company’s only assets will be its equity interests in RSI (which will be held indirectly through the Special Limited Partner) and the RSI GP. See “The Business Combination Proposal” for a more comprehensive description of the Business Combination.

Simultaneously with the Closing, the Company, the Special Limited Partner, RSI, the Sellers and the Sellers’ Representative will enter into the Tax Receivable Agreement, which will provide for, among other things, payment by the Special Limited Partner to the Sellers of 85% of the net income tax savings realized by the Company and its consolidated subsidiaries (including the Special Limited Partner) as a result of the increases in tax basis and certain other tax benefits related to the transactions contemplated under the Business Combination Agreement and the exchange of Retained RSI Units for Class A Common Stock (or cash) pursuant to the RSI A&R LPA and tax benefits related to entering into the Tax Receivable Agreement. Based primarily on historical losses of RSI, management has determined it is more-likely-than-not that the Company will be unable to utilize its deferred tax assets subject to the Tax Receivable Agreement; therefore, management has not recorded the deferred tax assets or a corresponding liability under the Tax Receivable Agreement related to the tax savings the company may realize from the utilization of tax deductions related to basis adjustments created by the transactions contemplated in the Business Combination Agreement and the exchange of Retained RSI Units for Class A Common Stock (or cash) pursuant to the RSI A&R LPA and tax benefits related to entering into the Tax Receivable Agreement. However, if utilization of the deferred tax assets were more-likely-than-not the Company would recognize a deferred tax asset of approximately $96 million and a liability of approximately $42 million, assuming (i) no redemptions of public shares; (ii) a price of $10 per share; (iii) a constant corporate tax rate of 29.94%; and (iv) no material changes in tax law. Under the same assumptions but instead considering the maximum redemption of public shares instead of no redemptions, the Company would recognize a deferred tax asset of approximately $39 million and no liability.

The following represents the aggregate consideration, which includes the Purchased RSI Units Cash Consideration, Aggregate Put-Call Consideration Amount and the value of the Retained RSI Units, in both the no redemption and maximum redemption scenarios:

 

     Assuming No
Redemptions
     Assuming
Maximum
Redemptions
 

Retained RSI Units(1)

     145,000,000        157,500,000  

Value per share(2)

   $ 10.00      $ 10.00  
  

 

 

    

 

 

 

Total value of Retained RSI Units

   $ 1,450,000,000      $ 1,575,000,000  

Plus: Purchased RSI Units Cash Consideration

   $ 99,235,503        —    

Plus: Aggregate Put-Call Consideration Amount(3)

   $ 25,764,497        —    
  

 

 

    

 

 

 

Total consideration

   $ 1,575,000,000      $ 1,575,000,000  
  

 

 

    

 

 

 

 

(1)

Retained RSI Units excludes 15,000,000 of the Retained RSI Units held by the Sellers subject to certain restrictions and potential forfeiture pending the achievement (if any) of certain earnout targets pursuant to the terms of the Business Combination Agreement.

(2)

Share consideration is calculated using a $10.00 reference price. As the Retained RSI Units are exchangeable, together with the cancelation of an equal number of shares of Class V Voting Stock, for an equal number of Class A Common Stock, actual total share consideration will be dependent on the value of the dMY Common Stock at Closing.

(3)

Assumes the RSI Units subject to the Put-Call Agreements are Purchased by RSI with the Aggregate Put-Call Consideration Amount upon the exercise of the Put-Calls shortly following the Closing of the Business Combination. Only applicable in a no-redemption scenario.

 

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The following summarizes the pro forma common stock shares outstanding of dMY following the Business Combination under the two redemption scenarios:

 

     Assuming No
Redemptions
(Shares)
     %     Assuming
Maximum
Redemptions
(Shares)
     %  

dMY public stockholders - Class A

     23,000,000        12.2     2,956,998        1.6

Holders of dMY sponsor shares - Class A(1)

     4,537,187        2.4     3,331,250        1.9

PIPE Investors - Class A

     16,043,002        8.5     16,043,002        8.9

RSI Sellers - Class V(2)(3)(4)

     145,000,000        76.9     157,500,000        87.6
  

 

 

    

 

 

   

 

 

    

 

 

 

Pro Forma Common Stock

     188,580,189        100.0     179,831,250        100.0
  

 

 

    

 

 

   

 

 

    

 

 

 

 

(1)

Excludes 1,212,813 shares of Class A Common Stock subject to certain restrictions and potential forfeiture pending the achievement (if any) of certain earnout targets pursuant to the terms of the Business Combination Agreement.

(2)

Excludes 15,000,000 shares of Class V Voting Stock subject to certain restrictions and potential forfeiture pending the achievement (if any) of certain earnout targets pursuant to the terms of the Business Combination Agreement.

(3)

The Class V Voting Stock entitle its holder to one vote per share but not any rights to dividends or distributions. Each share of Class V Voting Stock is issued to the Sellers for each Retained RSI Unit retained by the Seller following the Closing of the Business Combination.

(4)

Assumes the RSI Units subject to the Put-Call Agreements are purchased by RSI with the Aggregate Put-Call Consideration Amount upon the exercise of the Put-Calls shortly following the Closing of the Business Combination. Only applicable in a no-redemption scenario.

Assumptions and estimates underlying the unaudited pro forma adjustments set forth in the unaudited pro forma condensed combined financial statements are described in the accompanying notes. The unaudited pro forma condensed combined financial statements have been presented for illustrative purposes only and are not necessarily indicative of the operating results and financial position that would have been achieved had the Business Combination occurred on the dates indicated. Further, the unaudited pro forma condensed combined financial statements do not purport to project the future operating results or financial position of dMY following the completion of the Business Combination. The unaudited pro forma adjustments represent dMY management’s estimates based on information available as of the date of these unaudited pro forma condensed combined financial statements and are subject to change as additional information becomes available and analyses are performed.

 

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Table of Contents

UNAUDITED PRO FORMA CONDENSED COMBINED BALANCE SHEET

AS OF SEPTEMBER 30, 2020

(in thousands)

 

                Assuming No Redemptions     Assuming Maximum
Redemptions
 
    RSI
(Historical)
    dMY
(Historical)
    Pro Forma
Adjustments
(Note 2)
          Pro Forma
Combined
    Pro Forma
Adjustments
(Note 2)
          Pro Forma
Combined
 

Assets

               

Cash and cash equivalents

  $ 10,866     $ 482       230,759       (a   $ 247,537       230,759       (a   $ 172,107  
        (8,050     (b       (8,050     (b  
        (21,950     (c       (21,950     (c  
        160,430       (d       160,430       (d  
        (125,000     (k       (200,430     (l  

Restricted cash

    4,249       —         —           4,249       —           4,249  

Players receivable

    659       —         —           659       —           659  

Due from affiliates

    35,185       —         —           35,185       —           35,185  

Prepaid expenses and other current assets

    6,025       390       (2,760     (c     3,655       (2,760     (c     3,655  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total current assets

    56,984       872       233,429         291,285       157,999         215,855  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Investments held in Trust Account

    —         230,759       (230,759     (a     —         (230,759     (a     —    

License fee, net

    8,555       —         —           8,555       —           8,555  

Property and equipment, net

    1,308       —         —           1,308       —           1,308  

Operating lease right-of-use assets, net

    816       —         —           816       —           816  

Other assets

    911       —         —           911       —           911  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total assets

  $ 68,574     $ 231,631     $ 2,670       $ 302,875     $ (72,760     $ 227,445  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Liabilities

               

Accounts payable

  $ 7,141     $ 39     $       $ 7,180     $       $ 7,180  

Accrued expenses

    27,913       2,441       (5,201     (c     25,153       (5,201     (c     25,153  

Share-based liability

    108,932       —         1,984       (g     —         1,984       (g     —    
        (110,916     (h       (110,916     (h  

Deferred royalty, short-term

    159       —         —           159       —           159  

Operating lease liabilities, short term

    206       —         —           206       —           206  

Due to partners

    650       —         —           650       —           650  

Due to affiliates

    4,331       —         —           4,331       —           4,331  

Other current liabilities

    398       203       —           601       —           601  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total current liabilities

    149,730       2,683       (114,133       38,280       (114,133       38,280  

Deferred royalty, long term

    3,870       —         —           3,870       —           3,870  

Operating lease liabilities, long term

    621       —         —           621       —           621  

Deferred underwriting commissions associated with initial public offering

    —         8,050       (8,050     (b     —         (8,050     (b     —    
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total liabilities

    154,221       10,733       (122,183       42,771       (122,183       42,771  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Commitments and contingencies

               

Common stock subject to possible redemptions

    —         215,897       (215,897     (e     —         (215,897     (e     —    

Preferred units

    34,437       —         (34,437     (h     —         (34,437     (h     —    

Stockholders' equity/ Members' deficit

               

Preferred stock

    —         —         —           —         —           —    

Common stock

               

Class A

    —         —         2       (d     5       2       (d     2  
        2       (e       2       (e  
        1       (f       —         (f  
              (2     (l  

Class B

    —         1       (1     (f     —         (1     (f     —    

Class V

        15       (j     15       16       (j     16  

Members' units

    35,186       —         145,353       (h     —         145,353       (h     —    
        (180,539     (k       (180,539     (m  

 

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Table of Contents
                Assuming No Redemptions     Assuming Maximum
Redemptions
 
    RSI
(Historical)
    dMY
(Historical)
    Pro Forma
Adjustments
(Note 2)
          Pro Forma
Combined
    Pro Forma
Adjustments
(Note 2)
          Pro Forma
Combined
 

Additional paid in capital

    —         7,437       (19,509     (c     215,819       (19,509     (c     178,431  
        160,428       (d       160,428       (d  
        215,895       (e       215,895       (e  
        (2,437     (i       1       (f  
        (15     (j       (2,437     (i  
        (125,000     (k       (16     (j  
        (20,980     (k       (200,428     (l  
              17,060       (m  

Accumulated other comprehensive loss

    (566     —             (566         (566

Accumulated deficit

    (154,704     (2,437     2,437       (i     (155,162     2,437       (i     (154,950
        (1,984     (g       (1,984     (g  
        1,526       (k       1,738       (m  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total stockholders' equity attributable to common shareholders / members' deficit

    (120,084     5,001       175,194         60,111       138,016         22,933  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Noncontrolling interests

    —         —         199,993       (k     199,993       161,741       (m     161,741  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total stockholders' equity/ members' deficit

    (120,084     5,001       375,187         260,104       299,757         184,674