As filed with the Securities and Exchange Commission
on June 7, 2024
Registration No. 333-
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
DraftKings Inc.
(Exact name of registrant as specified in its charter)
|
Nevada
(State or other jurisdiction of incorporation) |
|
87-2764212
(IRS Employer
Identification No.) |
| |
222 Berkeley Street, 5th Floor
Boston, Massachusetts 02116
(617) 986-6744 |
|
| (Address, including zip code, and telephone number, including area code, of registrant’s principal executive offices) |
R. Stanton Dodge
Chief Legal Officer
DraftKings Inc.
222 Berkeley Street, 5th Floor
Boston, Massachusetts 02116
(617) 986-6744
(Name, address, including zip code, and telephone
number, including area code, of agent for service)
Copies to:
Scott D. Miller
Alan J. Fishman
Sullivan & Cromwell LLP
125 Broad Street
New York, New York 10004
(212) 558-4000
Approximate date of commencement of proposed
sale of the securities to the public:
From time to time after the effective date of
the Registration Statement.
If the only
securities being registered on this Form are being offered pursuant to dividend or interest reinvestment plans, please check the
following box. ¨
If any of the securities being registered on this Form are to
be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, other than securities offered
only in connection with dividend or interest reinvestment plans, check the following box. x
If this Form is
filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following
box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ¨
If this Form is
a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities
Act registration statement number of the earlier effective registration statement for the same offering. ¨
If this Form is a registration statement pursuant to General Instruction
I.D. or a post-effective amendment thereto that shall become effective upon filing with the Commission pursuant to Rule 462(e) under
the Securities Act, check the following box. x
If this Form is
a post-effective amendment to a registration statement filed pursuant to General Instruction I.D. filed to register additional securities
or additional classes of securities pursuant to Rule 413(b) under the Securities Act, check the following box. ¨
Indicate by check mark whether the registrant is a large accelerated
filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions
of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging
growth company” in Rule 12b-2 of the Exchange Act.
| Large
accelerated filer x |
Accelerated filer ¨ |
Non-accelerated filer ¨ |
Smaller reporting company ¨ |
| |
|
|
Emerging growth company ¨ |
If an emerging
growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any
new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. ¨
PROSPECTUS
CLASS A COMMON STOCK
PREFERRED STOCK
DEBT SECURITIES
WARRANTS
PURCHASE CONTRACTS
UNITS
DraftKings Inc. (“DraftKings”) may offer and sell from
time to time the securities described in this prospectus, and any selling stockholders may offer and sell from time to time shares of
our Class A common stock, par value $0.0001 per share (“Class A common stock”), in one or more offerings, in amounts,
at prices and on terms to be determined at the time of offering and sale. All of the shares of Class A common stock offered by the
selling stockholders will be sold by the selling stockholders for their respective accounts. We will not receive any of the proceeds from
those sales by the selling stockholders.
Each time we or any selling stockholders offer and sell securities,
we or such selling stockholders will provide a supplement to this prospectus that contains the specific information about the offering,
and, if applicable, the selling stockholders, as well as the amounts, prices and terms of the securities. A prospectus supplement may
also add, change or update information contained in this prospectus.
You should read this prospectus and any applicable prospectus supplement
carefully before you purchase any of our securities. THIS PROSPECTUS MAY NOT BE USED TO SELL SECURITIES UNLESS ACCOMPANIED BY A PROSPECTUS
SUPPLEMENT.
We may offer and sell the securities directly to you, through agents
we select, or through underwriters or dealers we select. In addition, any selling stockholders may offer and sell shares of our Class A
common stock from time to time. If any underwriters, dealers, or agents are involved in the sale of any of the securities, their names
and any applicable purchase price, fee, commission, or discount arrangement between or among them will be set forth, or will be calculable
from the information set forth, in the applicable prospectus supplement. If we use agents, underwriters or dealers to sell the securities,
we will disclose their names and the nature of our arrangement with them in a prospectus supplement. The net proceeds we expect to receive
from such sales will also be set forth in the prospectus supplement. For additional information on the method of sale, you should refer
to the section entitled “Plan of Distribution.”
Our
Class A common stock currently trades on the NASDAQ Global Select Market (“NASDAQ”) under the ticker symbol “DKNG.”
On June 6, 2024, the last reported sale price of our Class A common stock on NASDAQ was $37.56. The applicable prospectus
supplement will contain information, where applicable, as to any other listing, if any, on NASDAQ or any securities market or other exchange
of the securities covered by the applicable prospectus supplement.
Investing in these securities involves certain risks. See “Risk
Factors” beginning on page 2 of this document.
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this prospectus. Any representation
to the contrary is a criminal offense.
The date of this prospectus is June 7, 2024.
TABLE OF CONTENTS
About
This Prospectus
This prospectus is part of a registration statement that we filed with
the U.S. Securities and Exchange Commission (the “SEC”) as a “well-known seasoned issuer” as defined in Rule 405
under the Securities Act of 1933, as amended (the “Securities Act”), utilizing a shelf registration process. By using a shelf
registration statement, we may sell securities from time to time and in one or more offerings and any selling stockholders to be named
in a supplement to this prospectus may, from time to time, sell shares of Class A common stock in one or more offerings. Each time
we or any selling stockholders sell securities, we or the selling stockholders will provide a prospectus supplement that will contain
specific information about the terms of those securities and their offering. The prospectus supplement may also add, update or change
information contained in this prospectus. If there is any inconsistency between the information in this prospectus and any prospectus
supplement, you should rely on the information in that prospectus supplement. We urge you to read both this prospectus and any prospectus
supplement together with the additional information described under the heading “Where You Can Find More Information”.
Neither we, nor any selling stockholders, have authorized anyone
to provide any information or to make any representations other than as contained or incorporated by reference in this prospectus, any
applicable prospectus supplement, any related free writing prospectus used by us (which we refer to as a “company free writing prospectus”),
the documents incorporated by reference in this prospectus and any applicable prospectus supplement or any other information to which
we have referred you. We and any selling stockholders take no responsibility for, and can provide no assurance as to the reliability of,
any other information that others may give you. This prospectus, any accompanying prospectus supplement or any related company free writing
prospectus do not constitute an offer to sell or the solicitation of an offer to buy any securities other than the registered securities
to which they relate, nor does this prospectus, any accompanying prospectus supplement or any related company free writing prospectus constitute
an offer to sell or the solicitation of an offer to buy securities in any jurisdiction to any person to whom it is unlawful to make such
offer or solicitation in such jurisdiction. The information contained or incorporated by reference in this prospectus, any accompanying
prospectus supplement or any related company free writing prospectus is accurate as of the dates of the applicable documents. Our business,
financial condition, results of operations and prospects may have changed since the applicable dates. When this prospectus or a prospectus
supplement is delivered or sale pursuant to this prospectus or a prospectus supplement is made, neither we, nor any selling stockholders,
are implying that the information is current as of the date of the delivery or sale. In addition, the market and industry data and forecasts
that may be included or incorporated by reference in this prospectus, any prospectus supplement, or any applicable free writing prospectus
may involve estimates, assumptions, and other risks and uncertainties and are subject to change based on various factors, including those
discussed under the heading “Risk Factors” contained in this prospectus, the applicable prospectus supplement and any applicable
free writing prospectus, and under similar headings in other documents that are incorporated by reference into this prospectus. Accordingly,
investors should not place undue reliance on this information. You should not consider any information in this prospectus or in the documents
incorporated by reference herein to be investment, legal or tax advice. We encourage you to consult your own counsel, accountant and other
advisors for legal, tax, business, financial and related advice regarding an investment in our securities.
Unless the context indicates or requires otherwise, the terms “DraftKings,”
“our company,” “the Company,” “we,” “us” and “our” as used in this prospectus
refer to DraftKings Inc. and its consolidated subsidiaries. When we refer to “you,” we mean the potential holders of the applicable
securities.
Unless otherwise stated, currency amounts in this prospectus and any
prospectus supplement are stated in United States dollars.
Risk
Factors
Investing in our securities involves risk. You should carefully consider
the specific factors discussed under the caption “Risk Factors” in the applicable prospectus supplement, together with all
the other information contained in the prospectus supplement or appearing or incorporated by reference into this prospectus. You should
also consider the risks, uncertainties and assumptions discussed under Item 1A. “Risk Factors” included in our 2023 Annual
Report (as defined below), as amended and supplemented by subsequently filed Quarterly Reports on Form 10-Q and Current Reports on
Form 8-K. For more information, see the information provided under the heading “Where You Can Find More Information.”
The occurrence of any of these risks might cause you to lose all or part of your investment in the securities offered hereby. Additional
risks not currently known to us or that we now believe are immaterial may also significantly impair our business operations and financial
condition.
Where
You Can Find More Information
We file annual, quarterly and current reports, proxy statements and
other information with the SEC under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Our SEC filings
are available from the SEC’s Internet site at http://www.sec.gov, which contains reports, proxy and information statements, and
other information regarding issuers, like us, who file reports electronically with the SEC.
The SEC allows us to “incorporate by reference” into this
prospectus the information we file with them, which means that we can disclose important information to you by referring you to those
documents. Any statement contained or incorporated by reference in this prospectus shall be deemed to be modified or superseded for purposes
of this prospectus to the extent that a statement contained herein, or in any subsequently filed document which also is incorporated by
reference herein, modifies or supersedes such earlier statement. Any statement so modified or superseded shall not be deemed, except as
so modified or superseded, to constitute a part of this prospectus. We incorporate by reference the documents listed below (excluding
any portions of such documents that have been “furnished” but not “filed” for purposes of the Exchange Act):
All documents we file pursuant to Section 13(a), 13(c), 14 or
15(d) of the Exchange Act on or after the date of this prospectus and before all of the securities offered by this prospectus are
sold are incorporated by reference in this prospectus from the date of filing of the documents, except for information furnished under
Item 2.02 and Item 7.01 of Form 8-K, which is not deemed filed and not incorporated by reference herein. Information that we file
with the SEC will automatically update and may replace information in this prospectus and information previously filed with the SEC.
You may obtain any of the documents listed above from the SEC, through
the SEC’s website or from DraftKings by requesting them in writing or by telephone at the following address:
DraftKings Inc.
222 Berkeley Street, 5th Floor
Boston, Massachusetts 02116
Attention: Investor Relations
Telephone: (617) 986-6744
These documents are available from DraftKings without charge, excluding
any exhibits to them unless the exhibit is specifically listed as an exhibit to the registration statement of which this prospectus forms
a part.
Cautionary
Statement Regarding Forward-Looking Statements
This prospectus, the documents incorporated herein and any applicable
prospectus supplement contain forward-looking statements within the meaning of federal securities laws that reflect future plans, estimates,
beliefs and expected performance. The forward-looking statements depend upon events, risks and uncertainties that may be outside of our
control. The words “anticipate,” “believe,” “continue,” “could,” “estimate,”
“expect,” “intends,” “may,” “might,” “plan,” “possible,” “potential,”
“predict,” “project,” “should,” “will,” “would,” “forecast,” “propose,”
and similar expressions or the negative of these words may identify forward-looking statements, but the absence of these words does not
mean that a statement is not forward-looking. You are cautioned that our business and operations are subject to a variety of risks and
uncertainties, many of which are beyond our control, and, consequently, our actual results may differ materially from those projected.
Factors that could cause or contribute to such differences include,
but are not limited to, those identified below and the specific factors discussed under the caption “Risk Factors” in the
applicable prospectus supplement, together with all the other information contained in the prospectus supplement or appearing or incorporated
by reference into this prospectus. Any statements contained herein that are not statements of historical fact may be forward-looking statements.
| · | factors relating to our business, operations and financial performance, including: |
| · | our ability to effectively compete in the global entertainment and gaming industries; |
| · | our ability to successfully acquire and integrate new operations; |
| · | our ability to obtain and maintain licenses with gaming authorities; |
| · | our inability to recognize deferred tax assets and tax loss carryforwards; |
| · | market and global conditions and economic factors beyond our control, as well as the potential impact of general economic conditions,
including inflation and rising interest rates, on our liquidity, operations and personnel; |
| · | significant competition and competitive pressures from other companies worldwide in the industries in which we operate; |
| · | our ability to raise financing in the future; |
| · | our success in retaining or recruiting officers, key employees or directors; and |
| · | litigation and the ability to adequately protect our intellectual property rights. |
The foregoing list of factors is not exclusive. Due to the uncertain
nature of these factors, management cannot assess the impact of each factor on the business or the extent to which any factor, or combination
of factors, may cause actual results to differ materially from those contained in any forward-looking statements.
Additional information concerning these and other risk factors is contained
in our 2023 Annual Report, subsequent Quarterly Reports on Form 10-Q, recent Current Reports on Form 8-K, and other SEC filings.
All cautionary statements made or referred to herein should be read as being applicable to all forward-looking statements wherever they
appear. You should consider the risks and uncertainties described or referred to herein and should not place undue reliance on any forward-looking
statements.
Any forward-looking statement speaks only as of the date on which such
statement is made, and we undertake no obligation to update any of these statements to reflect events or circumstances occurring after
the date of this prospectus, except as required by applicable law. New factors may emerge and it is not possible to predict all factors
that may affect our business and prospects.
Information
About DraftKings
We are a digital sports entertainment and gaming company. We provide
users with online sports betting (“Sportsbook”), online casino (“iGaming”) and daily fantasy sports (“DFS”)
product offerings, as well as retail sportsbook, media and other consumer product offerings. We are also involved in the design and development
of sports betting and casino gaming software for online and retail sportsbooks and iGaming operators.
Our mission is to make life more exciting by responsibly creating the
world’s favorite real-money games and betting experiences. We accomplish this by creating an environment where our users can find
enjoyment and fulfillment through Sportsbook, iGaming, and DFS, as well as media and other online consumer product offerings. We are also
highly focused on our responsibility as a steward of this new era in real-money gaming. Our ethics guide our decision making with respect
to both the tradition and integrity of sports and our investments in regulatory compliance and consumer protection.
We continue to make deliberate and substantial investments in support
of our mission and long-term growth. For example, we have invested in our product offerings and technology in order to continuously launch
new product innovations; improve marketing, merchandising, and operational efficiency through data science; and deliver a great user experience.
We also make significant investments in sales and marketing and incentives to grow and retain our paid user base, including personalized
cross-product offers and promotions, and promote brand awareness to attract the “skin-in-the-game” sports fan. Together, these
investments have enabled us to create a leading product built on scalable technology, while attracting a user base that has resulted in
the rapid growth of our business.
DraftKings Holdings Inc. (formerly DraftKings Inc.) (“DraftKings
Holdings”) was incorporated in Nevada on December 13, 2019 as DEAC NV Merger Corp, a wholly owned subsidiary of our legal predecessor,
Diamond Eagle Acquisition Corp. (“DEAC”), a special purpose acquisition company. On April 23, 2020, DEAC consummated
the transactions contemplated by the business combination agreement, dated December 22, 2019, as amended on April 7, 2020, and
in connection therewith, DraftKings Holdings survived the merger and became a public company and the successor issuer to DEAC. On May 5,
2022, DraftKings Holdings consummated the acquisition of Golden Nugget Online Gaming, Inc., a Delaware corporation (“GNOG”),
pursuant to a definitive agreement and plan of merger, dated August 9, 2021, in an all-stock transaction (the “GNOG Transaction”).
In connection with the GNOG Transaction, DraftKings Holdings undertook a holding company reorganization where New Duke Holdco, Inc.,
a Nevada corporation, became the going-forward public company of both DraftKings Holdings and GNOG. New Duke Holdco, Inc. was renamed
DraftKings Inc., which is the issuer of the applicable securities offered hereby. DraftKings’ principal executive offices are located
at 222 Berkeley Street, 5th Floor, Boston, Massachusetts 02116. DraftKings’ telephone number is (617) 986-6744, and its website
address is www.draftkings.com. Information contained on DraftKings’ website or connected thereto is provided for textual reference
only and does not constitute part of, and is not incorporated by reference into, this prospectus or any applicable prospectus supplement.
Use
of Proceeds
We intend to use the net proceeds from the sale of the securities as
set forth in the applicable prospectus supplement. All of the shares of Class A common stock offered by the selling stockholders
will be sold by the selling stockholders for their respective accounts. We will not receive any of the proceeds from those sales by the
selling stockholders.
Description
of Capital Stock
The following summary of the material terms of our capital stock is
not intended to be a complete summary of the rights and preferences of such securities. The full text of our amended and restated articles
of incorporation (our “Articles of Incorporation”) and amended and restated bylaws (our “Bylaws”) are included
as exhibits to the registration statement of which this prospectus is a part. You are encouraged to read the applicable provisions of
Nevada law, our Articles of Incorporation and our Bylaws in their entirety for a complete description of the rights and preferences of
our capital stock. For more information, see the information provided under the heading “Where You Can Find More Information.”
Authorized and Outstanding Capital Stock
The Articles of Incorporation authorize the issuance of 2,100,000,000
shares of capital stock, of which 900,000,000 shares are shares of Class A common stock, par value $0.0001 per share, 900,000,000
shares are shares of Class B common stock, par value $0.0001 per share, and 300,000,000 shares are shares of preferred stock, par
value $0.0001 per share.
As of May 31, 2024, our issued and outstanding share capital consisted
of: (i) 484,621,538 shares of Class A common stock, held of record by approximately 946 holders, (ii) 393,013,951
shares of Class B common stock, held of record by one holder and (iii) no shares of preferred stock. In addition, as of May 31,
2024, 1,443,501 private placement warrants are outstanding and are held of record by approximately 175 warrantholders. Such
numbers do not include DTC participants or beneficial owners holding shares through nominee names.
Common Stock
Class A Common Stock
Voting Rights
Holders of our Class A common stock are entitled to cast one vote
per share of such Class A common stock. Generally, holders of all classes of our common stock vote together as a single class, and
an action is approved by our stockholders if at least a majority in voting power of the outstanding shares of capital stock of DraftKings
then present in person or represented by proxy at the meeting and entitled to vote on the action vote in favor of the action, while directors
are elected by a plurality of the votes of the outstanding shares of common stock present in person or represented by proxy at the meeting
and entitled to vote in an election of directors. Holders of our Class A common stock are not entitled to cumulate their votes in
the election of directors.
Dividend Rights
Holders of our Class A common stock will share ratably (based
on the number of shares of Class A common stock held) if and when any dividend is declared by the board of directors of DraftKings
(the “Board”) out of funds legally available therefor, subject to restrictions, whether statutory or contractual (including
with respect to any outstanding indebtedness), on the declaration and payment of dividends imposed by the terms of any outstanding preferred
stock or any class or series of stock having a preference over, or the right to participate with, our Class A common stock with respect
to the payment of dividends.
Liquidation, Dissolution and Winding Up
Upon the liquidation, dissolution, distribution of assets or winding
up of DraftKings, each holder of our Class A common stock will be entitled, pro rata on a per share basis, to all assets of
DraftKings of whatever kind available for distribution to the holders of our common stock, subject to the designations, preferences, limitations,
restrictions and relative rights of any other class or series of preferred stock of DraftKings then outstanding.
Other Matters
No shares of our Class A common stock are subject to redemption
(except as described below under “— Redemption Rights and Transfer Restrictions with Respect to Capital Stock Held by
Unsuitable Persons and Their Affiliates”) or have preemptive rights to purchase additional shares of our Class A common stock.
Holders of shares of our Class A common stock do not have subscription, redemption or conversion rights. All the outstanding shares
of our Class A common stock are validly issued, fully paid and non-assessable.
Class B Common Stock
Issuance of Class B Common Stock
Shares of our Class B common stock may be issued only to, and
registered in the name of, Jason Robins and any entities wholly owned by Mr. Robins (including all subsequent successors, assigns
and permitted transferees), which we collectively refer to as “Permitted Class B Owners.”
Voting Rights
Holders of our Class B common stock are entitled to cast 10 votes
per share of Class B common stock. Generally, holders of all classes of our common stock vote together as a single class, and an
action is approved by stockholders if at least a majority in voting power of the outstanding shares of capital stock of DraftKings then
present in person or represented by proxy at the meeting and entitled to vote on the action vote in favor of the action, while directors
are elected by a plurality of the votes of the outstanding shares of common stock present in person or represented by proxy at the meeting
and entitled to vote in an election of directors. Holders of our Class B common stock are not entitled to cumulate their votes in
the election of directors.
Dividend Rights
Holders of our Class B common stock will not participate in any
dividend declared by the Board.
Liquidation Rights
Upon the liquidation, dissolution, distribution of assets or winding
up of DraftKings, holders of our Class B common stock will not be entitled to receive any distribution of DraftKings assets of whatever
kind available until distribution has first been made to all holders of our Class A common stock.
However, due to the liquidation rights of holders of our Class A
common stock described above in which all assets of DraftKings of whatever kind available will be distributed to holders of Class A
common stock, no assets of DraftKings will be available for liquidating distributions in respect of our Class B common stock.
Transfers
Pursuant to the Articles of Incorporation, holders of our Class B
common stock are generally restricted from transferring such shares, other than to a Permitted Class B Owner or in connection with
a divorce or domestic relations order or decree; provided that, in each case, Mr. Robins must be deemed to retain the sole voting
power to vote such transferred Class B common stock.
Mandatory Cancellation
Each share of our Class B common stock will be (1) automatically
canceled for no consideration in the event that shares of our Class A common stock that are then held by Permitted Class B Owners
(including without limitation all shares of Class A common stock that are the subject of unvested stock options or other equity awards
awarded to Mr. Robins) represent less than 33% of Base Class A Shares (as defined in the Articles of Incorporation) and (2) subject
to cancelation by DraftKings (without consideration) one year after the date that both of the following conditions apply, which we refer
to as the “Founder Termination Anniversary Date”: (a) the earliest to occur of (i) Mr. Robins’
employment as Chief Executive Officer of DraftKings being terminated due to termination of employment for Cause or due to death or Permanent
Disability (each as defined in the Articles of Incorporation) and (ii) Mr. Robins resigns (other than for Good Reason (as defined
in the Articles of Incorporation)) as the Chief Executive Officer of DraftKings and (b) either (i) Mr. Robins no longer
serves as a member of the Board or (ii) Mr. Robins’ service to DraftKings is not his primary business occupation. In the
event that Mr. Robins is reinstated as the Chief Executive Officer of DraftKings or is reelected or reappointed to serve as a member
of the Board prior to the Founder Termination Anniversary Date, each of which we refer to as a “Reset Event,” then the shares
of Class B common stock will not be canceled pursuant to clause (2) unless and until the one-year anniversary of the date that
both of the foregoing conditions are subsequently met; provided that in the event of a subsequent Reset Event, the next Founder Termination
Anniversary Date will extend until the one-year anniversary of the date that both of the foregoing conditions are subsequently met without
a Reset Event occurring prior to such anniversary.
Other Matters
No shares of our Class B common stock are subject to redemption
(except as described below under “— Redemption Rights and Transfer Restrictions with Respect to Capital Stock Held by
Unsuitable Persons and Their Affiliates”) or have preemptive rights to purchase additional shares of Class B common stock.
Holders of shares of our Class B common stock do not have subscription, redemption or conversion rights. All outstanding shares of
our Class B common stock are validly issued, fully paid and non-assessable.
Preferred Stock
The Articles of Incorporation provide that the Board has the authority,
without action by the stockholders, to designate and issue shares of preferred stock in one or more classes or series, and the number
of shares constituting any such class or series, and to fix the voting powers, designations, preferences, limitations, restrictions and
relative rights of each class or series of preferred stock, including, without limitation, dividend rights, dividend rates, conversion
rights, exchange rights, voting rights, rights and terms of redemption, dissolution preferences, and treatment in the case of a merger,
business combination transaction, or sale of our assets, which rights may be greater than the rights of the holders of our common stock.
There are no shares of DraftKings preferred stock outstanding.
The purpose of authorizing the Board to issue preferred stock and determine
the rights and preferences of any classes or series of preferred stock is to eliminate delays associated with a stockholder vote on specific
issuances. The simplified issuance of our preferred stock, while providing flexibility in connection with possible acquisitions, future
financings and other corporate purposes, could have the effect of making it more difficult for a third party to acquire, or could discourage
a third party from seeking to acquire, a majority of our outstanding voting stock. Additionally, the issuance of our preferred stock may
adversely affect the holders of our Class A common stock including by restricting dividends on the Class A common stock, diluting
the voting power of the Class A common stock or subordinating the dividend or liquidation rights of the Class A common stock.
As a result of these or other factors, the issuance of our preferred stock could have an adverse impact on the market price of our Class A
common stock.
Warrants
Our private placement warrants (including our Class A common stock
issuable upon exercise of the private placement warrants) are not redeemable by us for cash so long as such warrants are held by the initial
purchasers or holders thereof (the “initial warrantholders”) or their permitted transferees. The initial warrantholders of
the private placement warrants, or their permitted transferees, have the option to exercise the private placement warrants on a cashless
basis. The private placement warrants may be redeemed for shares of our Class A common stock. If the private placement warrants are
held by holders other than the initial warrantholders thereof or their permitted transferees, the private placement warrants are redeemable
by DraftKings and exercisable by the holders on the same basis as the warrants included in the units sold in DEAC’s initial
public offering or the initial public offering of Landcadia Holdings II, Inc., which was the predecessor to GNOG.
The private placement warrants are required to be exercised on a cashless
basis in the event of a redemption of such warrants pursuant to the warrant agreement governing the warrants in which our Board has elected
to require all holders of the warrants who exercise their warrants to do so on a cashless basis. In such event, such holders of exercised
warrants would pay the exercise price by surrendering their warrants for that number of shares of our Class A common stock equal
to the quotient obtained by dividing (x) the product of the number of shares of our Class A common stock underlying the warrants,
multiplied by the excess of the “fair market value” of the shares of our Class A common stock over the exercise price
of the warrants by (y) the fair market value. The “fair market value” will mean the average closing price of our Class A
common stock for the ten (10) trading days ending on the third (3rd) trading day prior to the date on which the notice of redemption
is sent to the holders of warrants or the warrant agent, as applicable. The notice of redemption will contain the information necessary
to calculate the number of shares of our Class A common stock to be received upon exercise of the warrants, including the “fair
market value” in such case.
Exclusive Forum
The Articles of Incorporation provide that, to the fullest extent permitted
by law, unless we otherwise consent in writing, the Eighth Judicial District Court of Clark County, Nevada (or if the Eighth Judicial
District Court of Clark County, Nevada does not have jurisdiction, any other state district court located in the State of Nevada, and
if no state district court in the State of Nevada has jurisdiction, any federal court located in the State of Nevada) is the exclusive
forum for any action or proceeding brought in the name or right of DraftKings or on its behalf, any action asserting a claim for breach
of any fiduciary duty owed by any director, officer, employee or agent of DraftKings to DraftKings or its stockholders, any action asserting
a claim arising pursuant to any provision of the Nevada Revised Statutes (the “NRS”) Chapters 78 or 92A, our Articles of Incorporation
or our Bylaws, any action to interpret, apply, enforce or determine the validity of our Articles of Incorporation or our Bylaws or any
action asserting a claim governed by the internal affairs doctrine. The exclusive forum provision provides federal courts located in the
State of Nevada as the forum for suits brought to enforce any duty or liability for which Section 27 of the Exchange Act establishes
exclusive jurisdiction with the federal courts or any other claim for which the federal courts have exclusive jurisdiction.
Anti-Takeover Effects of Provisions of the Articles of Incorporation,
the Bylaws and Applicable Law
Certain provisions of our Articles of Incorporation, our Bylaws and
laws of the State of Nevada, where DraftKings is incorporated, may discourage or make more difficult a takeover attempt that a DraftKings
stockholder might consider in his or her best interest. These provisions may also adversely affect prevailing market prices for our common
stock. We believe that the benefits of increased protection give us the potential ability to negotiate with the proponent of an unsolicited
proposal to acquire or restructure DraftKings and outweigh the disadvantage of discouraging those proposals because negotiation of the
proposals could result in an improvement of their terms.
Authorized but Unissued Shares
The authorized but unissued shares of our Class A common stock,
Class B common stock and preferred stock are available for future issuance without stockholder approval, subject to any limitations
imposed by the listing standards of the NASDAQ. These additional shares may be used for a variety of corporate finance transactions, acquisitions
and employee benefit plans. The existence of authorized but unissued and unreserved common stock and preferred stock could make more difficult
or discourage an attempt to obtain control of DraftKings by means of a proxy contest, tender offer, merger or otherwise.
Dual Class Stock
As described above in “— DraftKings Common Stock — Class A
Common Stock — Voting Rights” and “— DraftKings Common Stock — Class B
Common Stock — Voting Rights,” our Articles of Incorporation provide for a dual class common
stock structure, which provides Mr. Robins with the ability to control the outcome of matters requiring DraftKings stockholder approval,
even though he owns significantly less than a majority of the shares of outstanding Class A common stock, including the election
of directors and significant corporate transactions, such as a merger or other sale of DraftKings or its assets.
Number of Directors
Our Articles of Incorporation and Bylaws provide that, subject to any
rights of holders of our preferred stock to elect additional directors under specified circumstances, the number of directors may be fixed
from time to time pursuant to a resolution adopted by the Board or, from and after the time that Mr. Robins beneficially owns less
than a majority of the voting power of our outstanding capital stock, may be modified by the affirmative vote of at least two-thirds of
the voting power of our outstanding capital stock. The number of directors is currently fixed at ten.
Requirements for Advance Notification of Stockholder Meetings,
Nominations and Proposals
The Bylaws establish advance notice procedures with respect to DraftKings
stockholder proposals and the nomination of candidates for election as directors, other than nominations made by or at the direction of
the Board or a committee of the Board. In order for any matter to be “properly brought” before a meeting, a DraftKings stockholder
has to comply with advance notice requirements and provide DraftKings with certain information. Generally, to be timely, a stockholder’s
notice must be received at DraftKings’ principal executive offices not less than 90 days nor more than 120 days prior
to the first anniversary date of the annual meeting for the preceding year. The Bylaws also specify requirements as to the form and content
of a stockholder’s notice. At a meeting of the stockholders, the Bylaws allow the chairman of the meeting to adopt rules, regulations
and procedures for the conduct of meetings which may have the effect of precluding the conduct of certain business at a meeting if the
rules and regulations are not followed. These provisions may also defer, delay or discourage a potential acquirer from conducting
a solicitation of proxies to elect the acquirer’s own slate of directors or otherwise attempting to influence or obtain control
of DraftKings.
Limitations on Stockholder Action by Written Consent
Nevada law permits stockholder action by written consent unless the
corporation’s articles of incorporation or bylaws provide otherwise. Pursuant to Section 78.320 of the NRS, any action required
to be taken at any annual or special meeting of the stockholders may be taken without a meeting, if, before or after the action, a written
consent to such action is signed by the holders of outstanding stock having at least a majority of the voting power of all classes entitled
to vote, or such different proportion that would be required for such an action at a meeting of the stockholders. Our Articles of Incorporation
provide that stockholder action by written consent is permitted so long as Mr. Robins beneficially owns a majority of the voting
power of the then-outstanding shares of our capital stock. Once Mr. Robins no longer beneficially owns a majority of the voting power
of the then-outstanding shares of our capital stock, all stockholder actions must be taken at a meeting of our stockholders.
Amendment of our Articles of Incorporation or Bylaws
Nevada law provides generally that a resolution of the board of directors
is required to propose an amendment to a corporation’s articles of incorporation and that the amendment must be approved by the
affirmative vote of a majority of the voting power of all classes entitled to vote, as well as a majority of any class adversely affected.
Nevada law also provides that the corporation’s bylaws, including any bylaws adopted by its stockholders, may be amended by the
board of directors and that the power to adopt, amend or repeal the bylaws may be granted exclusively to the directors in the corporation’s
articles of incorporation. Our Articles of Incorporation provide that, except as otherwise provided by applicable law, amendments to the
articles of our Articles of Incorporation governing the Board, stockholder matters, liability, transactions with stockholders, directors
and officers, exclusive forum, amendment, corporate opportunities and unsuitable persons must be approved by (1) a majority of the
combined voting power of all shares of our capital stock entitled to vote, voting together as a single class, so long as shares representing
a majority of the voting power of all of the then-outstanding shares of our capital stock entitled to vote are beneficially owned by Mr. Robins
or (2) two-thirds of the combined voting power of all shares entitled to vote, voting together as a single class, thereafter. With
respect to all other articles of our Articles of Incorporation, except as otherwise prohibited by applicable law, DraftKings reserves
the right to amend such articles in a manner prescribed in the Articles of Incorporation, the Bylaws or the NRS. Our Articles of Incorporation
and Bylaws provide that the Bylaws may be amended or repealed by either the Board or by the affirmative vote of stockholders representing
a majority of the voting power of all of the then-outstanding shares of our capital stock entitled to vote, while Mr. Robins beneficially
owns shares representing at least a majority of the voting power of our capital stock, or, thereafter, by the affirmative vote of stockholders
representing at least two-thirds or more of the voting power of our capital stock.
Business Combinations
The “business combination” provisions of Sections 78.411
to 78.444, inclusive, of the NRS generally prohibit a publicly traded Nevada corporation with at least 200 stockholders of record from
engaging in various “combination” transactions with any interested stockholder for a period of up to four years after
the date of the transaction in which the person became an interested stockholder, unless the combination or transaction was approved by
the board of directors before such person became an interested stockholder or the combination is approved by the board of directors, if
within two years after the date in which the person became an interested stockholder, and is approved at a meeting of the stockholders
by the affirmative vote of stockholders representing at least 60% (for a combination within two years after becoming an interested
stockholder) or a majority (for combinations between two and four years thereafter) of the outstanding voting power held by disinterested
stockholders. Alternatively, a corporation may engage in a combination with an interested stockholder more than two years after such
person becomes an interested stockholder if:
| · | the consideration to be paid to the holders of the corporation’s stock, other than the interested stockholder, is at least equal
to the highest of: (a) the highest price per share paid by the interested stockholder within the two years immediately preceding
the date of the announcement of the combination or the transaction in which it became an interested stockholder, whichever is higher,
plus interest compounded annually, (b) the market value per share of common stock on the date of announcement of the combination
or the date the interested stockholder acquired the shares, whichever is higher, less certain dividends paid or (c) for holders of
preferred stock, the highest liquidation value of the preferred stock, if it is higher; and |
| · | the interested stockholder has not become the owner of any additional voting shares since the date of becoming an interested stockholder
except by certain permitted transactions. |
A “combination” is generally defined to include (i) mergers
or consolidations with the “interested stockholder” or an affiliate or associate of the interested stockholder, (ii) any
sale, lease exchange, mortgage, pledge, transfer or other disposition of assets of the corporation, in one transaction or a series of
transactions, to or with the interested stockholder or an affiliate or associate of the interested stockholder: (a) having an aggregate
market value equal to 5% or more of the aggregate market value of the assets of the corporation, (b) having an aggregate market value
equal to 5% or more of the aggregate market value of all outstanding shares of the corporation or (c) representing more than 10%
of the earning power or net income (determined on a consolidated basis) of the corporation, (iii) any issuance or transfer of securities
to the interested stockholder or an affiliate or associate of the interested stockholder, in one transaction or a series of transactions,
having an aggregate market value equal to 5% or more of the aggregate market value of all of the outstanding voting shares of the corporation
(other than under the exercise of warrants or rights to purchase shares offered, or a dividend or distribution made pro rata to all
stockholders of the corporation), (iv) adoption of a plan or proposal for liquidation or dissolution of the corporation with the
interested stockholder or an affiliate or associate of the interested stockholder and (v) certain other transactions having the effect
of increasing the proportionate share of voting securities beneficially owned by the interested stockholder or an affiliate or associate
of the interested stockholder.
In general, an “interested stockholder” means any person
who (i) beneficially owns, directly or indirectly, 10% or more of the voting power of the outstanding voting shares of a corporation,
or (ii) is an affiliate or associate of the corporation that beneficially owned, within two years prior to the date in question,
10% or more of the voting power of the then-outstanding shares of the corporation.
We have opted out of these provisions in our Articles of Incorporation
until Mr. Robins ceases to beneficially own shares of our common stock representing at least 15% of our outstanding voting stock.
Control Share Acquisitions
The “control share” provisions of Sections 78.378
to 78.3793, inclusive, of the NRS apply to “issuing corporations” that are Nevada corporations doing business, directly or
through an affiliate, in Nevada, and having at least 200 stockholders of record, including at least 100 of whom have addresses in Nevada
appearing on the stock ledger of the corporation. The control share statute prohibits an acquirer, under certain circumstances, from voting
its “control shares” of an issuing corporation’s stock after crossing certain ownership threshold percentages,
unless the acquirer obtains approval of a majority of the voting power of the issuing corporation’s disinterested stockholders at
a meeting, or unless the issuing corporation amends its articles of incorporation or bylaws within 10 days of the acquisition. The
statute specifies three thresholds: one-fifth or more but less than one-third, one-third but less than a majority, and a majority or more,
of the outstanding voting power of a corporation. Generally, once an acquirer crosses one of the foregoing thresholds, those shares that
the acquirer, or persons acting in association with the acquiring person, acquired in an “acquisition” (as defined in the
NRS) or offered to acquire in such an acquisition, and those acquired within 90 days immediately preceding the date that the acquirer
crossed one of the thresholds, become “control shares,” and such control shares are deprived of the right to vote unless disinterested
stockholders vote to restore the right. In addition, the corporation, if provided in its articles of incorporation or bylaws in effect
on the tenth (10th) day following the acquisition of a controlling interest, may cause the redemption of all of the control shares at
the average price paid for such shares if the stockholders do not accord the control shares full voting rights. If control shares are
accorded full voting rights and the acquiring person has acquired a majority or more of all voting power, all other stockholders who did
not vote in favor of authorizing voting rights to the control shares are entitled to demand payment for the fair value of their shares
in accordance with statutory procedures established for dissenters’ rights.
We have opted out of these provisions in our Articles of Incorporation
until Mr. Robins ceases to beneficially own shares of our common stock representing at least 15% of our outstanding voting stock.
After such time, we may opt out of the “control share” statute by amending our Articles of Incorporation or our Bylaws within
10 days of the acquisition as provided by Nevada law.
The foregoing provisions of our Articles of Incorporation and Bylaws
could discourage potential acquisition proposals and could delay or prevent a change in control. These provisions are intended to enhance
the likelihood of continuity and stability in the composition of our Board and in the policies formulated by our Board and to discourage
certain types of transactions that may involve an actual or threatened change of control. These provisions and the provisions of Nevada
law described above are designed to reduce DraftKings’ vulnerability to an unsolicited acquisition proposal. The provisions also
are intended to discourage certain tactics that may be used in proxy fights. However, such provisions could have the effect of discouraging
others from making tender offers for our shares of common stock and, as a consequence, they also may inhibit fluctuations in the market
price of our Class A common stock that could result from actual or rumored takeover attempts. Such provisions also may have the effect
of preventing changes in our management or delaying or preventing a transaction that might benefit stockholders.
Limitations on Liability and Indemnification of Officers and Directors
Our Articles of Incorporation eliminate the liability of our officers
and directors to the fullest extent permitted by Nevada law. Nevada law provides that our directors and officers will not be individually
liable to us, our stockholders or our creditors for any damages for any act or failure to act in the capacity of a director or officer
other than in circumstances where both (i) the presumption that the director or officer acted in good faith, on an informed basis
and with a view to the interests of the corporation has been rebutted, and (ii) the act or failure to act of the director or officer
is proven to have been a breach of his or her fiduciary duties as a director or officer and such breach is proven to have involved intentional
misconduct, fraud or a knowing violation of law.
Our Articles of Incorporation and Bylaws also provide for indemnification
for our directors and officers to the fullest extent permitted by Nevada law. We have entered into indemnification agreements with each
of our directors that are, in some cases, broader than the specific indemnification provisions contained under Nevada law. The effect
of these provisions is to restrict our rights and the rights of our stockholders in derivative suits to recover any damages against a
director or officer for breach of fiduciary duties as a director, because a director or officer will not be individually liable for acts
or omissions, except where the act or failure to act constituted a breach of fiduciary duty and such breach involved intentional misconduct,
fraud or a knowing violation of law, and the presumption that the director or officer acted in good faith, on an informed basis, and with
a view to the interests of the corporation, has been rebutted.
These provisions may be held not to be enforceable for certain violations
of the federal securities laws of the United States.
We are also expressly authorized to carry directors’ and officers’
insurance to protect our directors, officers, employees and agents against certain liabilities.
The limitation of liability and indemnification provisions under Nevada
law and in our Articles of Incorporation and Bylaws may discourage stockholders from bringing a lawsuit against directors or officers
for breach of their fiduciary duties. These provisions may also have the effect of reducing the likelihood of derivative litigation against
directors and officers, even though such an action, if successful, might otherwise benefit DraftKings and our stockholders. However, these
provisions do not limit or eliminate our rights, or those of any DraftKings stockholder, to seek non-monetary relief such as injunction
or rescission in the event of a breach of a director’s fiduciary duties. Moreover, the provisions do not alter the liability of
directors under the federal securities laws. In addition, an investment may be adversely affected to the extent that, in a class action
or direct suit, we pay the costs of settlement and damage awards against directors and officers pursuant to these indemnification provisions.
Corporate Opportunities
In anticipation that Mr. Robins may engage in activities or lines
of business similar to those in which we engage, our Articles of Incorporation provide for, to the fullest extent permitted under Nevada
law, the renouncement by DraftKings of all interest and expectancy that DraftKings otherwise would be entitled to have in, and all rights
to be offered an opportunity to participate in, any business opportunity that from time to time may be presented to any director, stockholder,
officer or agent of DraftKings (or any affiliate thereof), other than an employee of DraftKings or any of its subsidiaries. Specifically,
no holder of shares of our common stock, nor any non-employee director, of DraftKings has any duty to refrain from engaging in the same
or similar business activities or lines of business that DraftKings does or otherwise competing with DraftKings. In the event that any
holder of shares of common stock of DraftKings or any director that is not an employee of DraftKings or its subsidiaries acquires knowledge
of a potential transaction or matter which may be a corporate opportunity for itself and DraftKings, that person will not have any duty
to communicate or offer such corporate opportunity to DraftKings and may pursue or acquire such corporate opportunity for itself or direct
such opportunity to another person.
To the fullest extent permitted by Nevada law, no potential transaction
or business opportunity may be deemed to be a potential corporate opportunity of DraftKings or its subsidiaries unless (a) DraftKings
and its subsidiaries would be permitted to undertake such transaction or opportunity in accordance with our Articles of Incorporation,
(b) DraftKings and its subsidiaries at such time have sufficient financial resources to undertake such transaction or opportunity
and (c) such transaction or opportunity would be in the same or similar line of business in which DraftKings and its subsidiaries
are then engaged or a line of business that is reasonably related to, or a reasonable extension of, such line of business.
Redemption Rights and Transfer Restrictions with Respect to Capital
Stock Held by Unsuitable Persons and Their Affiliates
The Articles of Incorporation provide that any common stock or any
other equity securities of DraftKings, or securities exchangeable or exercisable for, or convertible into, such other equity securities
of DraftKings owned or controlled by a person whom the Board determines in good faith (following consultation with reputable outside gaming
regulatory counsel) pursuant to a resolution adopted by the unanimous affirmative vote of all of the disinterested members of the Board
(i) fails or refuses to file an application (or fails or refuses, as an alternative, to otherwise formally request from the relevant
Gaming Authority a waiver or similar relief from filing such application) within 30 days (or such shorter period imposed by any gaming
authority, including any extensions of that period granted by the relevant gaming authority, but in no event more than such original 30
days) after having been requested in writing and in good faith to file an application by DraftKings (based on consultation with reputable
outside 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 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 DraftKings “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 equity interests, 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 DraftKings 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, DraftKings or any affiliated company to be threatened by any gaming authority
with the loss, rejection, rescission, suspension, revocation or non-renewal of any material gaming license (in each of (ii) through
(iv) above, only if such denial, disqualification or determination by a gaming authority is final and non-appealable), or (v) is
reasonably likely to (1) preclude or materially delay, impede, impair, threaten or jeopardize any material gaming license held or
desired in good faith to be held by DraftKings or any affiliated company or DraftKings’ or any affiliated company’s application
for, right to the use of, entitlement to, or ability to obtain or retain, any material gaming license held or desired in good faith to
be held by DraftKings or any affiliated company, or (2) 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 DraftKings or any affiliated company
(each of such persons, an “Unsuitable Person”) or its affiliates will be subject to mandatory sale and transfer on the terms
and conditions set forth in the Articles of Incorporation to either DraftKings or one or more third-party transferees (as described in
the Articles of Incorporation) and in such number and class(es)/series as determined by the Board.
Any such sale or transfer will not occur until the later to occur of:
(i) delivery to the Unsuitable Person of a copy of a resolution duly adopted by the unanimous affirmative vote of all of the disinterested
members of the Board at a meeting thereof called and held for the purpose (after providing reasonable notice to such person and a reasonable
opportunity for such person, together with their counsel, to be heard and to provide documents and written arguments), finding that the
Board has determined in good faith (following consultation with reputable outside gaming regulatory counsel) that (A) such person
is an Unsuitable Person and (B) it is necessary for such person or an affiliate of such person (as applicable) to sell and transfer
such number and class(es)/series of equity interests in order for DraftKings or an affiliated company to:
(1) obtain, renew, maintain or prevent the loss, rejection, rescission, suspension, revocation or non-renewal of a material gaming
license; (2) comply in any material respect with a material gaming law; (3) ensure that any material gaming license held or
desired in good faith to be held by DraftKings or any affiliated company, or DraftKings’ or any affiliated company’s application
for, right to the use of, entitlement to, or ability to obtain or retain, any material gaming license held or desired in good faith to
be held by DraftKings or any affiliated company, is not precluded, delayed, impeded, impaired, threatened or jeopardized in any material
respect; or (4) prevent the imposition of any materially burdensome terms or conditions on any material gaming license held or desired
in good faith to be held by DraftKings or any affiliated company, and specifying the reasoning for such determinations in reasonable detail,
and (ii) conclusion of any arbitration process brought in accordance with the provisions of the Articles of Incorporation.
Following (x) the determination of unsuitability by the Board
and (y) if applicable, an arbitrator determining that such determinations were made in good faith by the Board, DraftKings will deliver
a transfer notice to the Unsuitable Person or its affiliate(s) and will purchase and/or cause one or more third-party transferees
to purchase such number and class(es)/series of equity interests determined in good faith by the Board for the purchase price set forth
in the transfer notice, which will be determined in accordance with the Articles of Incorporation; provided that an Unsuitable Person
or its affiliate(s) will be permitted, during the 45-day period commencing on the date of the transfer notice (or before a transfer
notice is formally delivered), to effect and close a disposition of the number and class(es)/series of equity interests specified in the
transfer notice (or a portion of them) to a person that the Board determines in good faith (following consultation with reputable outside
gaming regulatory counsel) is not an Unsuitable Person, on terms agreed between the Unsuitable Person and such person (an “Alternate
Private Transaction”).
At the closing of a sale and transfer other than an Alternate Private
Transaction, (i) DraftKings or the third-party transferee(s) (as applicable) will deliver the aggregate applicable purchase
price for the equity interests being purchased by each of the foregoing by wire transfer of immediately available funds to the account
specified in writing by the Unsuitable Person or an affiliate of such Unsuitable Person (as applicable) in the case of third-party transferees,
by unsecured promissory note in the case of DraftKings, or a combination of both in the case of DraftKings in such proportion as it may
determine in its sole and absolute discretion and (ii) the Unsuitable Person or affiliate thereof will deliver to DraftKings or each
such third-party transferee, such stock powers, assignment instruments and other agreements as are necessary or appropriate to fully convey
all right, title and interest in and to the equity interests being purchased by each of the foregoing, free and clear of all liens and
other encumbrances and to evidence the subordination of any promissory note if and only to the extent required by any debt obligations
of DraftKings (and to the minimum extent required pursuant to such subordination arrangement).
The Articles of Incorporation provide that, in the case of a sale and
transfer to DraftKings, from and after the transfer date and subject only to the right to receive the purchase price for such equity interests,
the equity interests will be deemed no longer outstanding and the Unsuitable Person or any affiliate thereof will cease to be a DraftKings
stockholder, and all rights of such Unsuitable Person or any affiliate thereof, other than the right to receive the purchase price, will
cease. In the case of an Alternate Private Transaction or a transfer to one or more third-party transferees, from and after the earlier
to occur of: (i) the transfer date, in the case of a transfer to one or more such third-party transferees, or (ii) consummation
of an Alternate Private Transaction, subject only to the right to receive the purchase price for such Unsuitable Person’s equity
securities, all rights and entitlements of the Unsuitable Person or any affiliates thereof will be terminated, including, without limitation,
any such person will from such date no longer be entitled to: (i) receive any dividend, payment, distribution or interest with regard
to the applicable equity interests which has been declared following such date or of which the due payment date according to the applicable
declaration is following such date, other than the right to receive the purchase price or (ii) to exercise, directly or indirectly
or through any proxy, trustee, or nominee, any voting or other right (including, without limitation, observer and information rights)
conferred by the underlying equity interests.
Further, to the extent that a sale and transfer to one or more third-party
transferees is determined to be invalid or unenforceable for any reason, DraftKings will be permitted to redeem or repurchase the equity
interests owned or controlled by an Unsuitable Person or an affiliate thereof for the price and under the terms contemplated by the Articles
of Incorporation promptly following any such determination.
Stockholders’ Derivative Actions
Under Nevada law, any of our stockholders may bring an action in our
name to procure a judgment in our favor, also known as a derivative action, provided that the stockholder bringing the action was a holder
of DraftKings shares at the time of the transaction to which the action relates or such stockholder’s stock thereafter devolved
by operation of law and such suit is brought in a Nevada court. For further information, please read the section entitled “— Exclusive
Forum” above.
Transfer Agent and Registrar
The transfer agent for our capital stock and warrants is Computershare
Trust Company, N.A.
Description
of Debt Securities
This prospectus describes certain general terms and provisions of the
debt securities. The debt securities may be issued from time to time in one or more series pursuant to an indenture to be entered into
between DraftKings Inc. and one or more trustees selected by us. Such indenture is referred to herein as the “indenture.”
The terms of the debt securities will include those set forth in the indenture (as supplemented by any relevant officer’s certificate
or supplemental indenture) and those made a part thereof by the Trust Indenture Act of 1939, as amended. When we offer to sell a particular
series of debt securities, we will describe the specific terms for the securities in a supplement to this prospectus. The prospectus supplement
will also indicate whether the general terms and provisions described in this prospectus apply to a particular series of debt securities.
Because the following is only a summary of selected provisions to be
included in the indenture and the debt securities, it does not contain all information that may be important to you. This summary is not
complete and is qualified in its entirety by reference to the applicable indenture and any supplemental indentures thereto or officer’s
certificate or board resolution related thereto.
As used in this “Description of Debt Securities,” the terms
“we,” “our,” “us,” “the company” and “DraftKings” refer to DraftKings Inc.,
a Nevada corporation, and do not, unless otherwise specified, include our subsidiaries.
General
The indenture is not expected to limit the amount of debt securities
which we may issue. We may issue debt securities up to an aggregate principal amount as we may authorize from time to time. Our secured
debt, if any, will be effectively senior to any unsecured debt securities to the extent of the value of the assets securing such debt.
The debt securities will be exclusively our obligations and not of our subsidiaries and therefore the debt securities will be structurally
subordinated to the debt and other liabilities (including trade payables, but excluding intercompany obligations and liabilities of a
type not required to be reflected on a balance sheet in accordance with generally accepted accounting principles in the United States)
of any of our subsidiaries. The prospectus supplement will describe the terms of any debt securities being offered, including:
| · | any limit upon the aggregate principal amount; |
| · | whether the debt securities will be senior or subordinated; |
| · | applicable subordination provisions, if any; |
| · | whether the debt securities will be secured or unsecured and, if secured, what the collateral will consist of; |
| · | the date or dates on which the principal is payable; |
| · | the rate or rates at which the debt securities shall bear interest, if any, or the method by which such rate shall be determined; |
| · | the date or dates from which interest shall accrue; |
| · | the date or dates on which interest shall be payable; |
| · | the record dates for the determination of holders to whom interest is payable; |
| · | the right, if any, to extend the interest payment periods and the duration of such extension; |
| · | the place or places where the principal of and any interest shall be payable; |
| · | the price or prices at which, the period or periods within which and the terms and conditions upon which debt securities may be redeemed,
pursuant to any sinking fund or otherwise; |
| · | our obligation, if any, to redeem, purchase or repay the debt securities pursuant to any sinking fund or otherwise or at the option
of a holder thereof; |
| · | if applicable, the price or prices at which, the period or periods within which and the terms and conditions upon which the debt
securities shall be redeemed, purchased or repaid, in whole or in part; |
| · | any covenants applicable to the particular debt securities being issued; |
| · | any defaults and events of default applicable to the particular debt securities being issued and consequences of default; |
| · | any right to “reopen” a previous issue of a series of debt securities by issuing additional debt securities of such series; |
| · | the denominations in which the debt securities of the series shall be issuable; |
| · | the percentage of the principal amount at which the debt securities will be issued and, if other than the principal amount thereof,
the portion of such principal amount which shall be payable upon declaration of acceleration of the maturity thereof or provable in bankruptcy; |
| · | any and all other terms of the series including any terms which may be required by or advisable under U.S. law or regulations or advisable
in connection with the marketing of the debt securities; |
| · | whether the debt securities are issuable as global securities or definitive certificates and, in such case, the identity for the depositary; |
| · | any provisions granting special rights to holders when a specified event occurs; |
| · | whether and under what circumstances we will pay additional amounts on the debt securities held by a person who is not a U.S. person
in respect of any tax, assessment or governmental charge withheld or deducted; |
| · | any special tax implications of the debt securities; |
| · | any authenticating or paying agents, transfer agents or registrars or any other agents with respect to the debt securities, if other
than the trustee; |
| · | any guarantor or co-issuers; |
| · | any special interest premium or other premium; |
| · | whether the debt securities are convertible or exchangeable into any class of our common stock or other of our equity securities and
the terms and conditions upon which such conversion or exchange shall be effected; |
| · | the currency in which payments shall be made, if other than U.S. dollars; |
| · | securities exchange(s) on which the securities will be listed, if any; |
| · | whether any underwriter(s) will act as market maker(s) for the securities; |
| · | extent to which a secondary market for the securities is expected to develop; |
| · | additions to or changes in the events of default with respect to the securities and any change in the right of the trustee or the
holders to declare the principal, premium and interest with respect to such securities to be due and payable; |
| · | provisions relating to covenant defeasance and legal defeasance; |
| · | provisions relating to satisfaction and discharge of the indenture; |
| · | provisions relating to the modification of the indenture both with and without the consent of holders of debt securities issued under
the indenture; |
| · | provisions related to unclaimed funds; and |
| · | additional terms not inconsistent with the provisions of the indenture. |
United States federal income tax consequences and special considerations,
if any, applicable to any such series will be described in the applicable prospectus supplement.
Forms of Securities
Each debt security will be represented either by a certificate issued
in definitive form to a particular investor or by one or more global securities representing the entire issuance of securities. Certificated
securities in definitive form and global securities will be issued in registered form. Definitive securities name you or your nominee
as the owner of the security, and in order to transfer or exchange these securities or to receive payments other than interest or other
interim payments, you or your nominee must physically deliver the securities to the trustee, registrar, paying agent or other agent, as
applicable. Global securities name a depositary or its nominee as the owner of the debt securities represented by these global securities.
The depositary maintains a computerized system that will reflect each investor’s beneficial ownership of the securities through
an account maintained by the investor with its broker/dealer, bank, trust company or other representative, as we explain more fully below.
Registered Global Securities
We may issue the registered debt securities in the form of one or more
fully registered global securities that will be deposited with a depositary or its nominee identified in the applicable prospectus supplement
and registered in the name of that depositary or nominee. In those cases, one or more registered global securities will be issued in a
denomination or aggregate denominations equal to the portion of the aggregate principal or face amount of the securities to be represented
by registered global securities. Unless and until it is exchanged in whole for securities in definitive registered form, a registered
global security may not be transferred except as a whole by and among the depositary for the registered global security, the nominees
of the depositary or any successors of the depositary or those nominees.
If not described below, any specific terms of the depositary arrangement
with respect to any securities to be represented by a registered global security will be described in the prospectus supplement relating
to those securities. We anticipate that the following provisions will apply to all depositary arrangements.
Ownership of beneficial interests in a registered global security will
be limited to persons, called participants, that have accounts with the depositary or persons that may hold interests through participants.
Upon the issuance of a registered global security, the depositary will credit, on its book-entry registration and transfer system, the
participants’ accounts with the respective principal or face amounts of the securities beneficially owned by the participants. Any
dealers, underwriters or agents participating in the distribution of the securities will designate the accounts to be credited. Ownership
of beneficial interests in a registered global security will be shown on, and the transfer of ownership interests will be effected only
through, records maintained by the depositary, with respect to interests of participants, and on the records of participants, with respect
to interests of persons holding through participants. The laws of some states may require that some purchasers of securities take physical
delivery of these securities in definitive form. These laws may impair your ability to own, transfer or pledge beneficial interests in
registered global securities.
So long as the depositary, or its nominee, is the registered owner
of a registered global security, that depositary or its nominee, as the case may be, will be considered the sole owner or holder of the
securities represented by the registered global security for all purposes under the applicable indenture. Except as described below, owners
of beneficial interests in a registered global security will not be entitled to have the securities represented by the registered global
security registered in their names, will not receive or be entitled to receive physical delivery of the securities in definitive form
and will not be considered the owners or holders of the securities under the applicable indenture. Accordingly, each person owning a beneficial
interest in a registered global security must rely on the procedures of the depositary for that registered global security and, if that
person is not a participant, on the procedures of the participant through which the person owns its interest, to exercise any rights of
a holder under the applicable indenture. We understand that under existing industry practices, if we request any action of holders or
if an owner of a beneficial interest in a registered global security desires to give or take any action that a holder is entitled to give
or take under the applicable indenture, the depositary for the registered global security would authorize the participants holding the
relevant beneficial interests to give or take that action, and the participants would authorize beneficial owners owning through them
to give or take that action or would otherwise act upon the instructions of beneficial owners holding through them.
Principal, premium, if any, and interest payments on debt securities
represented by a registered global security registered in the name of a depositary or its nominee will be made to the depositary or its
nominee, as the case may be, as the registered owner of the registered global security. None of DraftKings, the trustee or any other agent
of DraftKings or agent of the trustee will have any responsibility or liability for any aspect of the records relating to payments made
on account of beneficial ownership interests in the registered global security or for maintaining, supervising or reviewing any records
relating to those beneficial ownership interests.
We expect that the depositary for any of the securities represented
by a registered global security, upon receipt of any payment of principal, premium, interest or other distribution of underlying securities
or other property to holders on that registered global security, will immediately credit participants’ accounts in amounts proportionate
to their respective beneficial interests in that registered global security as shown on the records of the depositary. We also expect
that payments by participants to owners of beneficial interests in a registered global security held through participants will be governed
by standing customer instructions and customary practices, as is now the case with the securities held for the accounts of customers in
bearer form or registered in “street name,” and will be the responsibility of those participants.
If the depositary for any of these securities represented by a registered
global security is at any time unwilling or unable to continue as depositary or ceases to be a clearing agency registered under the Securities
Exchange Act of 1934, and a successor depositary registered as a clearing agency under the Securities Exchange Act of 1934 is not appointed
by us within 90 days, we will issue securities in definitive form in exchange for the registered global security that had been held by
the depositary. Any securities issued in definitive form in exchange for a registered global security will be registered in the name or
names that the depositary gives to the relevant trustee or other relevant agent of ours or theirs. It is expected that the depositary’s
instructions will be based upon directions received by the depositary from participants with respect to ownership of beneficial interests
in the registered global security that had been held by the depositary.
Governing Law
The indenture and the debt securities for all purposes shall be governed
by and construed in accordance with the laws of the State of New York.
Description
of Other Securities
We will set forth in the applicable prospectus supplement a description
of any warrants, purchase contracts, or units issued by us that may be offered and sold pursuant to this prospectus.
Selling
Stockholders
Information about selling stockholders, where applicable, will be set
forth in a prospectus supplement, in a post-effective amendment or in filings we make with the SEC under the Exchange Act that are incorporated
by reference.
Plan
of Distribution
We or any selling stockholders may sell the securities from time to
time:
| · | through underwriters or dealers; |
| · | directly to one or more purchasers; or |
| · | through a combination of any of these methods of sale. |
The distribution of securities may be made from time to time in one
or more transactions at a fixed price or prices, which may be changed, at market prices prevailing at the time of sale, at prices related
to these prevailing market prices or at negotiated rates. We will identify the specific plan of distribution, including any underwriters,
dealers, agents, or direct purchasers and their compensation in the applicable prospectus supplement.
Legal
Matters
Unless otherwise indicated in an applicable prospectus supplement,
Greenberg Traurig, LLP will pass upon the validity of the Class A common stock and preferred stock offered by this prospectus and
certain other legal matters related to this prospectus. Certain legal matters relating to the issuance and sale of the other securities
offered hereby will be passed upon for us by Sullivan & Cromwell LLP, New York, New York. The validity of the securities to be
offered by this prospectus will be passed upon for us, any selling stockholders, any agents, underwriters, dealers, remarketing firms
or other third parties by counsel named in the applicable prospectus supplement.
Experts
The consolidated financial statements of DraftKings Inc. as of
December 31, 2023 and 2022 and for each of the three years in the period ended December 31, 2023, and management’s
assessment of the effectiveness of internal control over financial reporting as of December 31, 2023 incorporated by reference
in this Prospectus and in the Registration Statement have been so incorporated in reliance upon the reports of BDO USA, P.C., an
independent registered public accounting firm, given on the authority of said firm as experts in accounting and auditing.
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
The following is a statement of the estimated fees and expenses, other
than underwriting discounts and commissions, to be incurred by the registrant in connection with the distribution of the securities registered
under this registration statement:
| SEC registration fee |
|
|
(1)(2) |
| FINRA filing fee |
|
|
(2) |
| Printing expenses |
|
|
(2) |
| Legal fees and expenses |
|
|
(2) |
| Accounting fees and expenses |
|
|
(2) |
| Blue Sky, qualification fees and expenses |
|
|
(2) |
| Transfer agent fees and expenses |
|
|
(2) |
| Trustee fees and expenses |
|
|
(2) |
| Warrant agent fees and expenses |
|
|
(2) |
| Miscellaneous fees and expenses |
|
|
(2) |
| Total |
|
|
(2) |
| (1) | Pursuant to Rules 456(b) and 457(r) under the Securities Act of 1933, as amended, the SEC registration fee will be
paid at the time of any particular offering of securities under the registration statement, and is therefore not currently determinable. |
| (2) | These fees are calculated based on the securities offered and the number of issuances and accordingly cannot be estimated at this
time. |
Item 15. Indemnification of Directors and Officers.
Our amended and restated articles of incorporation eliminate the liability
of our officers and directors to the fullest extent permitted by Nevada law. Nevada law provides that our directors and officers will
not be individually liable to us, our stockholders or our creditors for any damages for any act or failure to act in the capacity of a
director or officer other than in circumstances where both (i) the presumption that the director or officer acted in good faith,
on an informed basis and with a view to the interests of the corporation has been rebutted, and (ii) the act or failure to act of
the director or officer is proven to have been a breach of his or her fiduciary duties as a director or officer and such breach is proven
to have involved intentional misconduct, fraud or a knowing violation of law.
Our amended and restated articles of incorporation and bylaws also
provide for indemnification for our directors and officers to the fullest extent permitted by Nevada law. We have entered into
indemnification agreements with each of our directors that are, in some cases, broader than the specific indemnification provisions contained
under Nevada law. The effect of these provisions is to restrict our rights and the rights of our stockholders in derivative suits to recover
any damages against a director or officer for breach of fiduciary duties as a director, because a director or officer will not be individually
liable for acts or omissions, except where the act or failure to act constituted a breach of fiduciary duty and such breach involved intentional misconduct,
fraud or a knowing violation of law, and the presumption that the director or officer acted in good faith, on an informed basis, and with
a view to the interests of the corporation, has been rebutted.
These provisions may be held not to be enforceable for certain violations
of the federal securities laws of the United States.
We are also expressly authorized to carry directors’ and officers’
insurance to protect our directors, officers, employees and agents against certain liabilities.
The limitation of liability and indemnification provisions under Nevada
law and in our amended and restated articles of incorporation and amended and restated bylaws may discourage stockholders from bringing
a lawsuit against directors or officers for breach of their fiduciary duties. These provisions may also have the effect of reducing the
likelihood of derivative litigation against directors and officers, even though such an action, if successful, might otherwise benefit
us and our stockholders. However, these provisions may not limit or eliminate our rights, or those of any stockholder, to seek non-monetary
relief such as injunction or rescission in the event of a breach of a director’s fiduciary duties. Moreover, the provisions do not
alter the liability of directors under the federal securities laws. In addition, the investment of any of our stockholders may be adversely
affected to the extent that, in a class action or direct suit, we pay the costs of settlement and damage awards against directors and officers pursuant
to these indemnification provisions.
Item 16. Exhibits and Financial Statement Schedules.
A list of exhibits filed herewith is contained on the Exhibit Index
and is incorporated herein by reference.
Item 17. Undertakings.
| (a) | The undersigned registrant hereby undertakes: |
| (1) | To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement: |
| (i) | To include any prospectus required by Section 10(a)(3) of the Securities Act; |
| (ii) | To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth
in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar
value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum
offering range may be reflected in the form of prospectus filed with the SEC pursuant to Rule 424(b) under the Securities Act
if, in the aggregate, the changes in volume and price represent no more than a 20% change in the maximum aggregate offering price set
forth in the “Calculation of Filing Fee Tables” or “Calculation of Registration Fee” table, as applicable in the
effective registration statement; and |
| (iii) | To include any material information with respect to the plan of distribution not previously disclosed in the registration statement
or any material change to such information in the registration statement; |
provided,
however, that clauses (1)(i), (1)(ii) and (1)(iii) do not apply if the registration statement is on Form S-3
and the information required to be included in a post-effective amendment by these clauses is contained in reports filed with or furnished
to the SEC by such registrant pursuant to Section 13 or Section 15(d) of the Exchange Act, that are incorporated by reference
in the registration statement, or is contained in a form of prospectus filed pursuant to Rule 424(b) that is part of the registration
statement;
| (2) | That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall
be deemed to be the initial bona fide offering thereof; |
| (3) | To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the
termination of the offering; |
| (5) | That, for the purpose of determining liability under the Securities Act to any purchaser: |
| (A) | Each prospectus filed by the registrant pursuant to Rule 424(b)(3) shall be deemed to be part of the registration statement
as of the date the filed prospectus was deemed part of and included in the registration statement; and |
| (B) | Each prospectus required to be filed pursuant to Rule 424(b)(2), (b)(5), or (b)(7) as part of a registration statement in
reliance on Rule 430B relating to an offering made pursuant to Rule 415(a)(1)(i), (vii), or (x) for the purpose of providing
the information required by Section 10(a) of the Securities Act shall be deemed to be part of and included in the registration
statement as of the earlier of the date such form of prospectus is first used after effectiveness or the date of the first contract of
sale of securities in the offering described in the prospectus. As provided in Rule 430B, for liability purposes of the issuer and
any person that is at that date an underwriter, such date shall be deemed to be a new effective date of the registration statement relating
to the securities in the registration statement to which the prospectus relates, and the offering of such securities at that time shall
be deemed to be the initial bona fide offering thereof. Provided, however, that no statement made in a registration statement
or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the
registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale
prior to such effective date, supersede or modify any statement that was made in the registration statement or prospectus that was part
of the registration statement or made in any such document immediately prior to such effective date; |
| (6) | That, for the purpose of determining liability of the registrant under the Securities Act of 1933 to any purchaser in the initial
distribution of the securities, the undersigned registrant undertakes that in a primary offering of securities of the undersigned registrant
pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities
are offered or sold to such purchaser by means of any of the following communications, such undersigned registrant will be a seller to
the purchaser and will be considered to offer or sell such securities to such purchaser: |
| (i) | Any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424; |
| (ii) | Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to
by the undersigned registrant; |
| (iii) | The portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant
or its securities provided by or on behalf of the undersigned registrant; and |
| (iv) | Any other communication that is an offer in the offering made by the undersigned registrant to the purchaser. |
| (b) | The undersigned registrant hereby undertakes that, for purposes of determining any liability under the Securities Act of 1933, each
filing of the registrant’s annual report pursuant to Section 13(a) or Section 15(d) of the Securities Exchange
Act of 1934 (and, where applicable, each filing of an employee benefit plan’s annual report pursuant to section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the registration statement shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial
bona fide offering thereof. |
| (h) | Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the
Securities and Exchange Commission, such indemnification is against public policy as expressed in the Securities Act of 1933 and is, therefore,
unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses
incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding)
is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless
in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the
question whether such indemnification by it is against public policy as expressed in the Securities Act of 1933 and will be governed by
the final adjudication of such issue. |
EXHIBIT INDEX
|
Exhibit
Number |
|
Exhibit Description |
| 1.1 |
|
Form of Underwriting Agreement.(1) |
| 2.1 |
|
Business Combination Agreement, dated as of December 22, 2019, among DraftKings Inc., SBTech (Global) Limited, SBTech’s shareholders, Diamond Eagle Acquisition Corp., DEAC NV Merger Corp. and a wholly-owned subsidiary of DEAC (incorporated by reference to Exhibit 2.1 of DEAC NV Merger Corp.’s Registration Statement on Form S-4 (Reg. No. 333-235805), filed with the SEC on April 14, 2020). |
| 2.2 |
|
Agreement and Plan of Merger, dated as of March 12, 2020, by and among Diamond Eagle Acquisition Corp. and DEAC NV Merger Corp. (incorporated by reference to Exhibit 2.3 of DEAC NV Merger Corp.’s Registration Statement on Form S-4 (Reg. No. 333-235805), filed with the SEC on April 14, 2020). |
| 2.3 |
|
Amendment to Business Combination Agreement, dated as of April 7, 2020, among DraftKings Inc., SBTech (Global) Limited, SBTech’s shareholders, Diamond Eagle Acquisition Corp., DEAC NV Merger Corp. and a wholly-owned subsidiary of DEAC (incorporated by reference to Exhibit 2.4 of DEAC NV Merger Corp.’s Registration Statement on Form S-4 (Reg. No. 333-235805), filed with the SEC on April 14, 2020). |
| 2.4* |
|
Agreement and Plan of Merger, by and among DraftKings Inc., New Duke Holdco, Inc., Golden Nugget Online Gaming, Inc., Duke Merger Sub, Inc. and Gulf Merger Sub, Inc., dated as of August 9, 2021 (incorporated by reference to Exhibit 2.1 of the Company's Current Report on Form 8-K, filed with the SEC on August 10, 2021). |
| 2.5* |
|
Agreement and Plan of Merger and Plan of Reorganization, dated as of February 11, 2024, by and among DraftKings Inc., DraftKings Holdings Inc., Fortune Merger Sub Inc., Fortune Merger Sub LLC, JackPocket, Inc. and Shareholder Representative Services LLC (incorporated by reference to Exhibit 2.1 of the Company’s Current Report on Form 8-K, filed with the SEC on February 15, 2024). |
| 3.1 |
|
Amended and Restated Articles of Incorporation of DraftKings Inc. (incorporated by reference to Exhibit 3.1 of the Company’s Current Report on Form 8-K, filed with the SEC on May 5, 2022) |
| 3.2 |
|
Amended and Restated Bylaws of DraftKings Inc. (incorporated by reference to Exhibit 3.2 of the Company’s Current Report on Form 8-K, filed with the SEC on May 5, 2022). |
| 4.1 |
|
Specimen Class A Common Stock Certificate of DraftKings (incorporated by reference to Exhibit 4.1 of the Company’s Annual Report on Form 10-K, filed with the SEC on February 16, 2024). |
| 4.2 |
|
Form of Specimen Preferred Stock Certificate.(1) |
| 4.3 |
|
Form of Debt Securities Indenture.(1) |
| 4.4 |
|
Form of Debt Securities.(1) |
| (1) | To be filed, if necessary, as an exhibit to a post-effective amendment to this registration statement or as an exhibit to a Current
Report on Form 8-K or other report to be filed by the Company pursuant to Section 13(a) or 15(d) of the Exchange Act
and incorporated herein by reference. |
| * | Annexes, schedules and/or exhibits have been omitted pursuant to Item 601(b)(2) of Regulation
S-K. The Company agrees to furnish supplementally a copy of any omitted attachment to the SEC on a confidential basis upon request. |
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended,
the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-3 and
has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Boston,
State of Massachusetts on June 7, 2024.
| |
DraftKings Inc. |
| |
|
| |
By |
/s/ R. Stanton Dodge |
| |
|
Name: |
R. Stanton Dodge |
| |
|
Title: |
Chief Legal Officer and Secretary |
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Jason D. Robins, R. Stanton Dodge, and Alan Ellingson as his or her true and lawful attorneys-in-fact
and agent, with full power of substitution and resubstitution, for him or her and in his or her name, place and stead, in any and all
capacities, to sign any and all amendments (including, without limitation, post-effective amendments) to this Registration Statement,
and any registration statement relating to the offering covered by this Registration Statement and filed pursuant to Rule 462(b) under
the Securities Act of 1933, and to file the same, with exhibits thereto and other documents in connection therewith, with the Securities
and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform
each and every act and thing requisite and necessary to be done, as fully for all intents and purposes as he or she might or could do
in person, hereby ratifying and confirming all that each of said attorneys in fact and agents or their substitute or substitutes may lawfully
do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this registration statement has been signed by the following persons in the capacities and on the dates indicated:
| Signature |
|
Title |
|
Date |
| |
|
|
|
|
|
/s/ Jason D.
Robins |
|
Chief Executive Officer and Chairman |
|
June 7, 2024 |
| Jason D. Robins |
|
(Principal Executive Officer) |
|
|
| |
|
|
|
|
|
/s/ Alan Ellingson |
|
Chief Financial Officer |
|
June 7, 2024 |
| Alan Ellingson |
|
(Principal Financial and Accounting Officer) |
|
|
| |
|
|
|
|
|
/s/ Harry Evans
Sloan |
|
Vice Chairman |
|
June 7, 2024 |
| Harry Evans Sloan |
|
|
|
|
| |
|
|
|
|
|
/s/ Matthew Kalish |
|
Director |
|
June 7, 2024 |
| Matthew Kalish |
|
|
|
|
| |
|
|
|
|
|
/s/ Woodrow H.
Levin |
|
Director |
|
June 7, 2024 |
| Woodrow H. Levin |
|
|
|
|
| |
|
|
|
|
|
/s/ Paul Liberman |
|
Director |
|
June 7, 2024 |
| Paul Liberman |
|
|
|
|
| |
|
|
|
|
|
/s/ Jocelyn Moore |
|
Director |
|
June 7, 2024 |
| Jocelyn Moore |
|
|
|
|
| Signature |
|
Title |
|
Date |
| |
|
|
|
|
|
/s/ Ryan R. Moore |
|
Director |
|
June 7, 2024 |
| Ryan R. Moore |
|
|
|
|
| |
|
|
|
|
|
/s/ Valerie Mosley |
|
Director |
|
June 7, 2024 |
| Valerie Mosley |
|
|
|
|
| |
|
|
|
|
|
/s/ Steven J.
Murray |
|
Director |
|
June 7, 2024 |
| Steven J. Murray |
|
|
|
|
| |
|
|
|
|
|
/s/ Marni M.
Walden |
|
Director |
|
June 7, 2024 |
| Marni M. Walden |
|
|
|
|
Exhibit 5.1
June 7, 2024
DraftKings Inc.
222 Berkeley Street, 5th Floor
Boston, Massachusetts 02116
Ladies and Gentlemen:
We have acted as special Nevada
counsel to DraftKings Inc., a Nevada corporation (the “Company”), in connection with the automatic shelf registration statement
on Form S-3 (such registration statement, including the documents incorporated by reference therein, the “Registration Statement”)
filed with the Securities and Exchange Commission (the “Commission”) on June 7, 2024 relating to the offering by the Company,
or the selling stockholders described therein, from time to time, pursuant to Rule 415 under the Securities Act of 1933, as amended (the
“Securities Act”), of: (i) shares of the Company’s Class A common stock, par value $0.0001 per share (“Common
Stock”); and (ii) shares of the Company’s preferred stock, par value $0.0001 per share (“Preferred Stock”); in
each case, as described in the base prospectus forming a part of the Registration Statement (the “Base Prospectus”) as may
be supplemented in the future by one or more supplements to the Base Prospectus (each a “Prospectus Supplement” and together
with the Base Prospectus, a “Prospectus”). The Common Stock and the Preferred Stock are hereinafter referred to, collectively,
as the “Opinion Securities.” We note that you are receiving an opinion from other counsel with respect to certain other securities
described in the Base Prospectus.
This opinion letter is being
furnished in accordance with the requirements of Item 601(b)(5) of Regulation S-K under the Securities Act.
We have made such legal and
factual examinations and inquiries, including an examination of originals or copies certified or otherwise identified to our satisfaction
of such documents, corporate records and instruments, as we have deemed necessary or appropriate for purposes of this opinion letter.
In our examination, we have assumed the genuineness of all signatures, the authenticity of all documents submitted to us as originals
and the conformity to authentic original documents of all documents submitted to us as copies. As to facts material to the opinions, statements
and assumptions expressed herein, we have, with your consent, relied upon oral or written statements and representations of officers and
other representatives of the Company and others. We have not independently verified such factual matters.
Based upon and subject to
the foregoing, and assuming, with your consent, that: (i) the Registration Statement and any post-effective amendments thereto will have
become effective and comply with all applicable laws; (ii) the Registration Statement will be effective and will comply with all applicable
laws at the time the Opinion Securities are offered or issued as contemplated by the Registration Statement, the Base Prospectus, and
the applicable Prospectus Supplement(s); (iii) a Prospectus Supplement or term sheet will have been prepared and filed with the Commission
describing the Opinion Securities offered thereby and will comply with all applicable laws; (iv) all Opinion Securities will be issued
and sold in compliance with applicable federal and state securities laws and in the manner stated in the Registration Statement and the
appropriate Prospectus Supplement; (v) a definitive purchase, underwriting, or similar agreement (each a “Purchase Agreement”)
with respect to any Opinion Securities offered or issued will have been duly authorized and validly executed and delivered by the Company
and the other parties thereto; and (vi) any Opinion Securities issuable upon conversion, exchange, or exercise of any security being offered
or issued will be duly authorized, created, and, if appropriate, reserved for issuance upon such conversion, exchange, or exercise; we
are of the opinion that:
Greenberg Traurig, LLP
| Attorneys at Law
10845 Griffith Peak Drive | Suite 600 | Las Vegas, Nevada 89135 | T +1 702.792.3773 |
F +1 702.792.9002
www.gtlaw.com
DraftKings Inc.
June 7, 2024
Page 2
1. With
respect to the offer and sale of Common Stock, when an issuance of Common Stock has been duly authorized by all necessary corporate action
of the Company, upon issuance, delivery, and payment therefor, in the manner contemplated by the applicable Prospectus Supplement and
by such corporate action, and in total amounts and numbers of shares that do not exceed the respective total amounts and numbers of shares
(a) available under the Company’s articles of incorporation (as amended, the “Articles of Incorporation”) and (b) authorized
by the board of directors of the Company (the “Board”) in connection with the offering contemplated by the applicable Prospectus,
such shares of Common Stock will be validly issued, fully paid and nonassessable.
2. With
respect to shares of any series of Preferred Stock, when (A) the Board has taken all necessary corporate action to approve the issuance
and terms of the shares of the series, the terms of the offering thereof and related matters, including the adoption of a resolution establishing
and designating the series and fixing and determining the preferences, limitations and relative rights thereof and the filing of articles
of amendment to the Articles of Incorporation with respect to the series with the Secretary of State of the State of Nevada as required
under the Nevada Revised Statutes, and (B) certificates representing the shares of the series of Preferred Stock have been duly executed,
countersigned, registered and delivered either (i) in accordance with the applicable definitive purchase, underwriting or similar agreement
approved by the Board, upon payment of the consideration therefor as provided for therein; or (ii) upon conversion, exchange or exercise
of any other security in accordance with the terms of the security or the instrument governing the security providing for the conversion,
exchange or exercise as approved by the Board, for the consideration approved by the Board, the shares of such series of Preferred Stock
will be validly issued, fully paid and non-assessable.
This opinion letter is limited
to the matters stated herein, and no opinions may be implied or inferred beyond the matters expressly stated herein. The opinions expressed
herein are as of the date hereof, and we assume no obligation to update or supplement such opinions to reflect any facts or circumstances
that may hereafter come to our attention or any changes in law that may hereafter occur. We do not express any opinion herein concerning
any law other than the laws of the State of Nevada.
We hereby consent to the filing
of this opinion letter as an exhibit to the Registration Statement and to the use of our name under the caption “Legal Matters”
in the Registration Statement. In giving such consent, we do not thereby admit that we are included within the category of persons whose
consent is required under Section 7 of the Securities Act or the rules and regulations promulgated thereunder.
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Sincerely, |
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/s/ Greenberg Traurig, LLP |
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GREENBERG TRAURIG, LLP |
| Greenberg Traurig, LLP | Attorneys at Law |
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www.gtlaw.com |
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Exhibit 5.2
[Letterhead of Sullivan & Cromwell LLP]
DraftKings Inc.,
222 Berkeley Street, 5th Floor,
Boston, MA 02116.
Ladies and Gentlemen:
In connection with the registration under the Securities
Act of 1933 (the “Act”) of (i) shares of Class A common stock, par value $0.0001 per share (the “Class A
Common Stock”) of DraftKings Inc., a Nevada corporation (the “Company”), (ii) shares of preferred stock, par value
$0.0001 per share, of the Company (the “Preferred Stock”), (iii) debt securities of the Company (the “Debt Securities”),
(iv) warrants of the Company to purchase Debt Securities, Preferred Stock or Common Stock (the “Warrants”), (v) purchase
contracts of the Company (the “Purchase Contracts”) and (vi) units of the Company (the “Units,” and together
with the Common Stock, the Preferred Stock, the Debt Securities, the Warrants and the Purchase Contracts, the “Securities”),
pursuant to a Registration Statement on Form S-3 (the “Registration Statement”) we, as your counsel, have examined such
corporate records, certificates and other documents, and such questions of law, as we have considered necessary or appropriate for the
purposes of this opinion.
Upon the basis of such examination, it is our opinion
that:
1. Debt
Securities. When the Registration Statement has become effective under the Act, when the indenture relating to the relevant Debt Securities
has been duly authorized, executed and delivered, when the terms of the Debt Securities and of their issuance and sale have been duly
established in conformity with the applicable indenture so as not to violate any applicable law or result in a default under or breach
of any agreement or instrument binding upon the Company and so as to comply with any requirement or restriction imposed by any court or
governmental body having jurisdiction over the Company, and when the Debt Securities have been duly authorized, executed and authenticated
in accordance with the applicable indenture and issued and sold as contemplated by the Registration Statement, the Debt Securities will
constitute valid and legally binding obligations of the Company, subject to bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium and similar laws of general applicability relating to or affecting creditors’ rights and to general equity principles.
2. Warrants.
When the Registration Statement has become effective under the Act, when the terms of the warrant agreement under which the Warrants
are to be issued have been duly established and the warrant agreement has been duly authorized, executed and delivered by the parties
thereto, when the terms of such Warrants and of their issuance and sale have been duly established in conformity with the applicable warrant
agreement and issued and sold as contemplated by the Registration Statement so as not to violate any applicable law or result in a default
under or breach of any agreement or instrument binding upon the Company and so as to comply with any requirement or restriction imposed
by any court or governmental body having jurisdiction over the Company, such Warrants will constitute valid and legally binding obligations
of the Company, subject to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and similar laws of general applicability
relating to or affecting creditors’ rights and to general equity principles.
3. Purchase
Contracts. When the Registration Statement has become effective under the Act, when the terms of the governing instruments or agreements
under which the Purchase Contracts are to be issued have been duly established and such governing documents have been duly authorized,
executed and delivered by the parties thereto, when the terms of such Purchase Contracts and of their issuance and sale have been duly
established in conformity with the applicable governing documents and such Purchase Contracts have been duly authorized, executed and
authenticated in accordance with the applicable governing documents and issued and sold as contemplated by the Registration Statement
so as not to violate any applicable law or result in a default under or breach of any agreement or instrument binding upon the Company
and so as to comply with any requirement or restriction imposed by any court or governmental body having jurisdiction over the Company,
such Purchase Contracts will constitute valid and legally binding obligations of the Company, subject to bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and similar laws of general applicability relating to or affecting creditors’ rights and to
general equity principles.
4. Units.
When the Registration Statement has become effective under the Act, when the terms of the unit agreement under which the Units are
to be issued have been duly established and the unit agreement has been duly authorized, executed and delivered by the parties thereto,
when the terms of the Units and of their issuance and sale have been duly established in conformity with the applicable unit agreement
and the Units have been duly authorized, executed and authenticated in accordance with the applicable unit agreement and issued and sold
as contemplated by the Registration Statement so as not to violate any applicable law or result in a default under or breach of any agreement
or instrument binding upon the Company and so as to comply with any requirement or restriction imposed by any court or governmental body
having jurisdiction over the Company, such Units will constitute valid and legally binding obligations of the Company, subject to bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium and similar laws of general applicability relating to or affecting creditors’
rights and to general equity principles.
-2-
In connection with our opinion set forth in paragraphs
(1) through (4) above, we have assumed that at the time of the issuance, sale and delivery of each particular Security, the
authorization of the Securities will not have been modified or rescinded and, with respect to each Security, that such Security will conform
to the draft forms of the Securities examined by us.
In connection with our opinion set forth in paragraphs
(1) through (4) above, we have assumed that at the time of the issuance, sale and delivery of each particular Security there
will not have occurred any change in law affecting the validity, legally binding character or enforceability of such Security and that
the issuance, sale and delivery of such Security, all of the terms of such Security and the performance by the Company of its obligations
thereunder will comply with applicable law and with each requirement or restriction imposed by any court or governmental body having jurisdiction
over the Company and will not result in a default under or a breach of any agreement or instrument then binding upon the Company.
In connection with our opinion set forth in paragraphs
(1) through (4) above, we have assumed with respect to each particular Security that the inclusion of any alternative or additional
terms in such Security that are not currently specified in the draft forms of Securities examined by us would not require the Company
to obtain any regulatory consent, authorization or approval or make any regulatory filing in order for the Company to issue, sell and
deliver such Security.
We note that, as of the date of this opinion, a judgment
for money in an action based on a Security denominated in a foreign currency or currency unit in a Federal or state court in the United
States ordinarily would be enforced in the United States only in United States dollars. The date used to determine the rate of conversion
of the foreign currency or currency unit in which a particular Security is denominated into United States dollars will depend upon various
factors, including which court renders the judgment. Under Section 27 of the New York Judiciary Law, a state court in the State of
New York rendering a judgment on such a Security would be required to render such judgment in the foreign currency or currency unit in
which the Security is denominated, and such judgment would be converted into United States dollars at the exchange rate prevailing on
the date of entry of the judgment.
-3-
The foregoing opinion is limited to the Federal laws
of the United States and the laws of the State of New York, and we are expressing no opinion as to the effect of the laws of any other
jurisdiction. With respect to all matters of Nevada law, we note that you have received an opinion, dated June 7, 2024, of Greenberg
Traurig, LLP.
In rendering the foregoing opinions, we are expressing
no opinion as to Federal or state laws relating to fraudulent transfers and we are not passing upon, and assume no responsibility for,
any disclosure in any registration statement or any related prospectus or other offering material relating to the offer and sale of the
Securities.
We have relied as to certain factual matters on information
obtained from public officials, officers of the Company and other sources believed by us to be responsible, and we have assumed that the
Company has been duly incorporated and is an existing corporation in good standing under the laws of the State of Nevada, an assumption
which we have not independently verified.
We hereby consent to the filing of this opinion as
an exhibit to the Registration Statement and to the references to us under the heading “Legal Matters” in the prospectus contained
therein. In giving such consent, we do not thereby admit that we are in the category of persons whose consent is required under Section 7
of the Act.
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Very truly yours, |
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/s/ Sullivan & Cromwell |
-4-
Exhibit 23.1
Consent of Independent Registered
Public Accounting Firm
We hereby consent to the incorporation by reference
in the Prospectus constituting a part of this Registration Statement of our reports dated February 16, 2024, relating to the consolidated
financial statements and the effectiveness of internal control over financial reporting of DraftKings Inc. (the Company) appearing in
the Company’s Annual Report on Form 10-K for the year ended December 31, 2023.
We also consent to the reference
to us under the caption “Experts” in the Prospectus.
/s/ BDO USA, P.C.
Boston, Massachusetts
June 7, 2024
Exhibit 107
Calculation of Filing Fee Tables
Form S-3
(Form Type)
DraftKings Inc.
(Exact Name of Registrant as Specified in its Charter)
Table 1—Newly Registered and Carry Forward
Securities
| |
Security
Type |
Security
Class
Title |
Fee
Calculation
or Carry
Forward
Rule |
Amount
Registered |
Proposed
Maximum
Offering
Price Per
Unit |
Maximum
Aggregate
Offering Price |
Fee
Rate |
Amount of
Registration
Fee |
Carry
Forward
Form Type |
Carry
Forward
File Number |
Carry
Forward
Initial
effective
date |
Filing Fee
Previously
Paid In
Connection
with Unsold
Securities
to be
Carried
Forward |
| Newly Registered Securities |
| Fees to Be Paid |
Equity |
Class A common stock, par value $0.0001 per share |
Rule 456(b) and
Rule 457(r) |
(1) |
(1) |
(1) |
(2) |
(2) |
|
|
|
|
| |
Equity |
Preferred Stock |
Rule 456(b) and
Rule 457(r) |
(1) |
(1) |
(1) |
(2) |
(2) |
|
|
|
|
| |
Debt |
Debt Securities |
Rule 456(b) and
Rule 457(r) |
(1) |
(1) |
(1) |
(2) |
(2) |
|
|
|
|
| |
Other |
Warrants |
Rule 456(b) and
Rule 457(r) |
(1) |
(1) |
(1) |
(2) |
(2) |
|
|
|
|
| |
Other |
Purchase Contracts |
Rule 456(b) and
Rule 457(r) |
(1) |
(1) |
(1) |
(2) |
(2) |
|
|
|
|
| |
Other |
Units |
Rule 456(b) and
Rule 457(r) |
(1) |
(1) |
(1) |
(2) |
(2) |
|
|
|
|
| |
Equity |
Secondary Offering:
Class A common stock, par value $0.0001 per share |
Rule 456(b) and
Rule 457(r) |
(1) |
(1) |
(1) |
(2) |
(2) |
|
|
|
|
| Fees Previously Paid |
— |
— |
— |
— |
— |
— |
|
— |
|
|
|
|
| Carry Forward Securities |
| Carry Forward Securities |
— |
— |
— |
— |
|
— |
|
— |
|
|
|
|
| |
Total Offering Amounts |
|
— |
|
— |
|
|
|
|
| |
Total Fees Previously Paid |
|
|
|
— |
|
|
|
|
| |
Total Fee Offsets |
|
|
|
— |
|
|
|
|
| |
Net Fees Due |
|
|
|
— |
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
| (1) | An
indeterminate amount of the securities of each identified class is being registered as may from time to time be offered hereunder at
indeterminate prices, along with an indeterminate number of securities that may be issued upon exercise, settlement, exchange, or conversion
of securities offered or sold hereunder. Pursuant to Rule 416 under the Securities Act of 1933, as amended (the “Securities Act”),
this registration statement also covers any additional securities that may be offered or issued in connection with any stock split, stock
dividend, or pursuant to anti-dilution provisions of any of the securities. Separate consideration may or may not be received for securities
that are issuable upon conversion, exercise, or exchange of other securities. |
| (2) | In
accordance with Rules 456(b) and 457(r) under the Securities Act, the registrant is deferring payment of all registration fees and will
pay the registration fees subsequently in advance or on a “pay-as-you-go” basis. |
DraftKings (NASDAQ:DKNG)
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