Washington, D.C. 20549
If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D,
and is filing this schedule because of Rule 13d-1(e), Rule 13d-1(f) or Rule 13d-1(g), check the following box. ☐
The information required on the remainder of this cover page shall not be deemed to be “filed” for the purpose of Section 18 of the
Securities Exchange Act of 1934 (“Act”) or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).
CUSIP No. 26142R104
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13D
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Page 2 of 7 pages
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1
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Names of Reporting Persons
Shalom Meckenzie
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2
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Check the Appropriate Box if a Member of a Group
(a) ☐ (b) ☒
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3
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SEC Use Only
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4
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Source of Funds (See Instructions)
OO
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5
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Check if disclosure of legal proceedings is required pursuant to Items 2(d) or 2(e)
☐
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6
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Citizenship or Place of Organization
Israel
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NUMBER OF
SHARES
BENEFICIALLY
OWNED BY
EACH
REPORTING
PERSON
WITH
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7
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Sole Voting Power
34,628,397
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8
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Shared Voting Power
0
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9
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Sole Dispositive Power
34,628,397
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10
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Shared Dispositive Power
0
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11
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Aggregate Amount Beneficially Owned by Each Reporting Person
34,628,397
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12
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Check if the Aggregate Amount in Row (11) Excludes Certain Shares ☒
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13
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Percent of Class Represented by Amount in Row (11)
11.1%
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14
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Type of Reporting Person
IN
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CUSIP No. 26142R104
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13D
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Page 3 of 7 pages
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Item 1. Security and Issuer.
This statement on Schedule 13D (the “Schedule 13D”) relates to the Class A common stock (the “Common Stock”), par value $0.0001, of
DraftKings Inc., a Nevada corporation (the “Issuer”) whose principal executive offices are located at 222 Berkeley Street, 5th Floor, Boston, MA 02116.
Item 2. Identity and Background.
The Schedule 13D is being filed by Shalom Meckenzie.
Shalom Meckenzie is a citizen of Israel. Mr. Meckenzie’s business address is 27 Hagderot St., Savion 5652627, Israel. Mr. Meckenzie’s
principal occupation is that he is an entrepreneur and the founder of SBTech (Global) Limited, a company limited by shares, originally incorporated in Gibraltar and continued as a company under the Isle of Man Companies Act 2006, with registration
number 014119V (“SB Tech”). SB Tech is headquartered at 33-37 Athol Street, Douglas, Isle of Man IM1 1LB and its principal business activities involve the design and development of sports betting and casino gaming platform software for online and
retail sportsbook and casino gaming products. As a result of the Business Combination (as defined below), SB Tech is now a wholly-owned subsidiary of the Issuer.
During the last five years, Mr. Meckenzie (i) has not been convicted in any criminal proceeding (excluding traffic violations or similar
misdemeanors) or (ii) has not been a party to a civil proceeding of a judicial or administrative body of competent jurisdiction and as a result of such proceeding was or is subject to a judgment, decree or final order enjoining future violations of,
or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws.
Item 3. Source and Amount of Funds or Other Consideration.
On December 22, 2019, Diamond Eagle Acquisition Corp., a Delaware corporation (“DEAC”), DraftKings Inc., a Delaware corporation (“Old DK”),
SB Tech, DEAC NV Merger Corp., a Nevada corporation and a wholly-owned subsidiary of DEAC (“DEAC Nevada”), DEAC Merger Sub Inc., a Delaware corporation and a wholly-owned subsidiary of DEAC (“Merger Sub”), the shareholders of SBT party thereto (the
“SBT Sellers”) and Shalom Meckenzie in his capacity as the SBT Sellers’ representative entered into a business combination agreement (as amended by Amendment No. 1, dated as of April 7, 2020, the “BCA”) which, among other things, provided for
(i) DEAC to merge with and into DEAC Nevada, with DEAC Nevada surviving the merger (the “reincorporation”), (ii) following the reincorporation, Merger Sub to merge with and into Old DK, with Old DK surviving the merger (the “DK Merger”), (iii)
immediately following the DK Merger, DEAC Nevada to acquire all of the issued and outstanding share capital of SBTech and (iv) DEAC Nevada to be renamed DraftKings Inc. (the “Business Combination”).
On April 23, 2020 (the “Closing Date”), the parties to the BCA consummated the Business Combination in accordance with the BCA (the
“Closing”).
Immediately prior to the Closing, Mr. Meckenzie was a major shareholder of SB Tech and held 34,680 shares of SB Tech, which he had acquired
as a founder of SB Tech in 2007 and in subsequent transactions with SB Tech. In the Business Combination, all of Mr. Meckenzie’s shares of SB Tech capital stock were converted into 34,628,397 shares of Common Stock at a ratio of 998.512 to 1.
Pursuant to the BCA, Mr. Meckenzie will also have the right to receive up to an additional 612,000 shares of Common Stock (“Earnout Shares”), which are currently being held in escrow, (i) one-third
of which will be released from escrow if (a) the volume weighted average share price of the Common Stock for at least 20 of any 30 consecutive trading days following the Closing Date (the “VWAP”) is at least $12.50 or (b) the Issuer consummates a
transaction resulting in its stockholders being able to exchange their shares for cash, securities or other property with a per share value (“Qualifying Value”) of at least $12.50; (ii) one-third if (a) the VWAP is at least $14.00 or (b) the Issuer
consummates a transaction with a Qualifying Value of at least $14.00; and (iii) one-third if (a) the VWAP is at least $16.00 or (b) the Issuer consummates a transaction with a Qualifying Value of at least $16.00. Any shares not eligible to be
released within four years of the Closing Date will be forfeited and canceled.
CUSIP No. 26142R104
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13D
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Page 4 of 7 pages
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Item 4. Purpose of Transaction.
Mr. Meckenzie acquired the securities described in this Schedule 13D in connection with the closing of the Business Combination. Pursuant to
the Stockholders Agreement described in Item 6 below, Mr. Meckenzie has the right to nominate two directors to initially serve on the Issuer’s board of directors (the “Board”), subject to certain independence requirements. Mr. Meckenzie has appointed
himself as one of these initial directors. In addition, so long as Mr. Meckenzie (together with his immediate family members, his and their wholly-owned affiliates and any trust whose sole beneficiaries are Mr. Meckenzie and his immediate family
members) continues to hold at least nine percent of the issued and outstanding shares of the Common Stock at the time of a subsequent annual meeting, Mr. Meckenzie will have the right to nominate one director to serve on the Board, subject to the
Board’s approval not to be unreasonably withheld, conditioned or delayed.
As a director of the Issuer, Mr. Meckenzie may participate in discussions regarding every aspect of the Issuer’s governance,
management and operations, whether with management, other members of the Issuer’s board of directors, investors, advisers and other persons.
Subject to the Stockholders Agreement described in Item 6 and the Issuer’s Insider Trading Policy, Mr.
Meckenzie may from time to time buy or sell securities of the Issuer as appropriate for his personal circumstances and reflecting his overall investment posture. Other than as described above and elsewhere in this Schedule 13D, Mr. Meckenzie
does not currently have any plans or proposals that relate to, or would result in, any of the matters listed in Items 4(a)–(j) of Schedule 13D, although Mr. Meckenzie may change his purpose or formulate plans or proposals with respect thereto at any
time.
Item 5. Interest in Securities of the Issuer.
(a) The following sets
forth, as of the date of this Schedule 13D, the aggregate number of shares of Common Stock and percentage of shares of Common Stock beneficially owned by Shalom Meckenzie, as well as the number of shares of Common Stock as to which Mr. Meckenzie
has the sole power to vote or to direct the vote, shared power to vote or to direct the vote, sole power to dispose or to direct the disposition of, or shared power to dispose or to direct the disposition of, as of the date hereof, based on
312,451,027 shares of Common Stock outstanding following completion of the Business Combination. All of these shares are held through a trust of which the Reporting Person is beneficiary and over which Mr. Meckenzie has sole voting and dispositive
power. Such trust was established in connection with a pre-ruling of the Israel Tax Authority to ensure payment of any tax due to the Israel Tax Authority in connection with the Business Combination.
Reporting Person
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Amount beneficially owned
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Percent of class
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Sole power to vote or to direct the vote
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Shared power to vote or to direct the vote
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Sole power to dispose or to direct the disposition
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Shared power to dispose or to direct the disposition
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Shalom Meckenzie
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34,628,397(1)
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11.1%
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34,628,397
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0
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34,628,397
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0
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(1)
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As reported in Item 3 above, Mr. Meckenzie has the right to receive certain Earnout Shares under the BCA if certain stock price thresholds are met by specified dates. The
Earnout Shares are not included in this report of beneficial ownership.
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(b) By virtue of the
provisions of the Stockholders Agreement referenced in Item 6 below, Mr. Meckenzie may be deemed to be a member of a “group” with, and may be deemed to have or share indirect voting power over any shares of Common Stock acquired directly by certain
initial shareholders and the independent directors of DEAC (the “DEAC Stockholder Group”), certain stockholders of Old DK (the “DK Stockholder Group”) and the SBT Sellers (the “SBT Stockholder Group” and, together with the DEAC Stockholder Group
and the DK Stockholder Group, the “Stockholder Parties”). Mr. Meckenzie disclaims the existence of a group with such persons and his beneficial ownership of any shares of Common Stock beneficially owned by such other persons and the number of
shares reported in the cover pages as shared voting power does not include any of those shares of Common Stock. In the aggregate, any group formed thereby would beneficially own the shares of Common Stock owned by Mr. Meckenzie as well as the
shares of Common Stock beneficially owned by the other Stockholder Parties, if any. In the aggregate, the Stockholder Parties beneficially own 225,443,123 shares of Common Stock which is 67.3% of the class, based on 335,154,335 shares of
Common Stock outstanding, which number of Common Stock issued and outstanding takes into account additional Issuer-disclosed shares of Common Stock which Stockholder Parties have the right to acquire within 60 days.