Exhibit 10.1

 

Execution Version

 

SUBSCRIPTION AGREEMENT

 

This SUBSCRIPTION AGREEMENT (this “Subscription Agreement”) is entered into on
December 22, 2019, by and between Diamond Eagle Acquisition Corp., a Delaware
corporation that will be re-domiciled to Nevada in connection with the
Transaction (as defined below) (the “Company”), and the undersigned subscriber
(“Subscriber”).

 

WHEREAS, concurrently with the execution of this Subscription Agreement, the
Company is entering into a Business Combination Agreement with DraftKings Inc.,
a Delaware corporation (“DK”), SBTech (Global) Limited, a company limited by
shares, incorporated in Gibraltar and continued as a company under the Isle of
Man Companies Act 2006, with registration number 014119V (“SBT”), and the other
parties thereto, providing for the combination of the Company, DK and SBT (the
“Transaction Agreement” and the transactions contemplated by the Transaction
Agreement, the “Transaction”);

 

WHEREAS, pursuant to the Transaction Agreement, prior to or substantially
concurrently with the Closing (as defined below), the Company will convert to a
Nevada corporation (the “NV Conversion”);

 

WHEREAS, in connection with the Transaction, Subscriber desires to subscribe for
and purchase from the Company, immediately prior to the NV Conversion and
consummation of the Transaction, that number of shares of the Company’s Class A
common stock, par value $0.0001 per share (the “Class A Shares”), set forth on
the signature page hereto (the “Subscribed Shares”) for a purchase price of
$10.00 per share (the “Per Share Price” and the aggregate of such Per Share
Price for all Subscribed Shares being referred to herein as the “Purchase
Price”), and the Company desires to issue and sell to Subscriber the Subscribed
Shares in consideration of the payment of the Purchase Price by or on behalf of
Subscriber to the Company; and

 

WHEREAS, concurrently with the execution of this Subscription Agreement, the
Company is entering into subscription agreements (the “Other Subscription
Agreements” and together with the Subscription Agreement, the “Subscription
Agreements”) with certain other investors (the “Other Subscribers” and together
with the Subscriber, the “Subscribers”), pursuant to which such investors have
agreed to purchase on the closing date of the Transaction (the “Closing Date”),
inclusive of the Subscribed Shares, an aggregate amount of up to 40,000,000
Class A Shares, at the Per Share Price (the “Other Subscribed Shares” and
together with the Subscribed Shares, the “Collective Subscribed Shares”).

 

NOW, THEREFORE, in consideration of the foregoing and the mutual
representations, warranties and covenants, and subject to the conditions, herein
contained, and intending to be legally bound hereby, the parties hereto hereby
agree as follows:

 

1.      Subscription.

 

a.       Subject to the terms and conditions hereof, at the Closing (as defined
below), Subscriber hereby agrees to subscribe for and purchase, and the Company
hereby agrees to issue and sell to Subscriber, upon the payment of the Purchase
Price, the Subscribed Shares (such subscription and issuance, the
“Subscription”).

 

 

 

 

b.       In addition, for each Subscribed Share purchased by Subscriber,
Subscriber shall receive from the Company [__] warrants to purchase shares of
Common Stock (the “Incentive Warrants”). Each whole Incentive Warrant shall be
exercisable for one share of Common Stock at a price of $11.50 per share and
shall have identical terms to the warrants included as part of the Company’s
units issued in the IPO. No fractional Incentive Warrants will be issued, and
the Company will round the number of Incentive Warrants to be issued to the
Subscriber down to the nearest whole number.

 

2.      Closing.

 

a.       The consummation of the Subscription contemplated hereby (the
“Closing”) shall occur on the Closing Date immediately prior to the NV
Conversion and the consummation of the Transaction.

 

b.      At least five (5) Business Days before the anticipated Closing Date, the
Company shall deliver written notice to Subscriber (the “Closing Notice”)
specifying (i) the anticipated Closing Date and (ii) the wire instructions for
delivery of the Purchase Price to the Company. No later than two (2) Business
Days after receiving the Closing Notice, Subscriber shall deliver to the Company
such information as is reasonably requested in the Closing Notice in order for
the Company to issue the Subscribed Shares to Subscriber. Subscriber shall
deliver to the Company, on or prior to 8:00 a.m. (Eastern time) (or as soon as
practicable after the Company or its transfer agent delivers evidence of the
issuance to Subscriber of the Subscribed Shares on and as of the Closing Date)
on the Closing Date the Purchase Price in cash via wire transfer to the account
specified in the Closing Notice against (and concurrently with) delivery by the
Company to Subscriber of (i) the Subscribed Shares in book entry form, free and
clear of any liens or other restrictions (other than those arising under this
Subscription Agreement or state or federal securities laws), in the name of
Subscriber (or its nominee in accordance with its delivery instructions) or to a
custodian designated by Subscriber, as applicable, and (ii) written notice from
the Company or its transfer agent evidencing the issuance to Subscriber of the
Subscribed Shares on and as of the Closing Date. In the event that the
consummation of the Transaction does not occur within one (1) Business Day after
the anticipated Closing Date specified in the Closing Notice, the Company shall
promptly (but in no event later than two (2) Business Days after the anticipated
Closing Date specified in the Closing Notice) return the funds so delivered by
Subscriber to the Company by wire transfer in immediately available funds to the
account specified by Subscriber. For the purposes of this Subscription
Agreement, “Business Day” means any day other than a Saturday, Sunday or a day
on which the Federal Reserve Bank of New York is closed.

 

c.       The Closing shall be subject to the satisfaction or valid waiver by the
Company, on the one hand, or the Subscriber, on the other, of the conditions
that, on the Closing Date:

 

(i) no suspension of the qualification of the Subscribed Shares for offering or
sale or trading in any jurisdiction, or initiation or threatening of any
proceedings for any of such purposes, shall have occurred;

 

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(ii) all conditions precedent to the closing of the Transaction set forth in the
Transaction Agreement, including the approval of the Company’s shareholders,
shall have been satisfied or waived, and the closing of the Transaction shall be
scheduled to occur concurrently with or immediately following the Closing; and

 

(iii) no governmental authority shall have enacted, issued, promulgated,
enforced or entered any judgment, order, law, rule or regulation (whether
temporary, preliminary or permanent) which is then in effect and has the effect
of making consummation of the transactions contemplated hereby illegal or
otherwise restraining or prohibiting consummation of the transactions
contemplated hereby (except in the case of a governmental authority located
outside the United States where such judgment, order, law, rule or regulation
would not be reasonably expected to have a Company Material Adverse Effect (as
defined below)); and no such governmental authority shall have instituted or
threatened in writing a proceeding seeking to impose any such restraint or
prohibition (except in the case of a governmental authority located outside the
United States where such restraint or prohibition would not be reasonably
expected to have a Company Material Adverse Effect).

 

d.      The obligation of the Company to consummate the Closing shall be subject
to the satisfaction or valid waiver by the Company of the additional conditions
that, on the Closing Date:

 

(i) all representations and warranties of Subscriber contained in this
Subscription Agreement shall be true and correct in all material respects (other
than representations and warranties that are qualified as to materiality or
Subscriber Material Adverse Effect (as defined below), which representations and
warranties shall be true in all respects) at and as of the Closing Date; and

 

(ii) Subscriber shall have performed, satisfied and complied in all material
respects with all covenants, agreements and conditions required by this
Subscription Agreement to be performed, satisfied or complied with by it at or
prior to the Closing.

 

e.       The obligation of Subscriber to consummate the Closing shall be subject
to the satisfaction or valid waiver by Subscriber of the additional conditions
that, on the Closing Date:

 

(i) all representations and warranties of the Company contained in this
Subscription Agreement shall be true and correct in all material respects (other
than representations and warranties that are qualified as to materiality or
Company Material Adverse Effect (as defined below), which representations and
warranties shall be true in all respects) at and as of the Closing Date;

 

(ii) the Company shall have performed, satisfied and complied in all material
respects with all covenants, agreements and conditions required by this
Subscription Agreement to be performed, satisfied or complied with by it at or
prior to the Closing;

 

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(iii) there shall have been no amendment, waiver or modification to (A) the
Transaction Agreement that materially and adversely affects the Company or (B)
the Other Subscription Agreements that materially economically benefits the
investors thereunder unless the Subscribers have been offered substantially the
same benefits; and

 

(iv) the Registration Statement (as defined below) shall have been declared
effective by the Commission.

 

f.        Prior to or at the Closing, Subscriber shall deliver to the Company a
duly completed and executed Internal Revenue Service Form W-9 or appropriate
Form W-8.

 

3.      Company Representations and Warranties.    The Company represents and
warrants to Subscriber that:

 

a.       The Company (i) is duly organized, validly existing and in good
standing under the laws of its jurisdiction of incorporation, (ii) has the
requisite power and authority to own, lease and operate its properties, to carry
on its business as it is now being conducted and to enter into and perform its
obligations under this Subscription Agreement, and (iii) is duly licensed or
qualified to conduct its business and, if applicable, is in good standing under
the laws of each jurisdiction (other than its jurisdiction of incorporation) in
which the conduct of its business or the ownership of its properties or assets
requires such license or qualification, except, with respect to the foregoing
clause (iii), where the failure to be in good standing would not reasonably be
expected to have a Company Material Adverse Effect. For purposes of this
Subscription Agreement, a “Company Material Adverse Effect” means an event,
change, development, occurrence, condition or effect with respect to the Company
and its subsidiaries, taken together as a whole (on a consolidated basis), that,
individually or in the aggregate, has a material adverse effect on the business,
financial condition or results of operations of the Company and its
subsidiaries, taken together as a whole (on a consolidated basis).

 

b.      The Subscribed Shares have been duly authorized and, when issued and
delivered to Subscriber against full payment therefor in accordance with the
terms of this Subscription Agreement, will be validly issued, fully paid and
non-assessable and will not have been issued in violation of any preemptive
rights created under the Company’s organizational documents or the laws of its
jurisdiction of incorporation.

 

c.       This Subscription Agreement has been duly executed and delivered by the
Company, and assuming the due authorization, execution and delivery of the same
by Subscriber, this Subscription Agreement shall constitute the valid and
legally binding obligation of the Company, enforceable against the Company in
accordance with its terms, except as such enforceability may be limited by
bankruptcy, insolvency, reorganization, moratorium and similar laws affecting
creditors generally and by the availability of equitable remedies.

 

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d.      The execution and delivery of this Subscription Agreement, the issuance
and sale of the Subscribed Shares and the compliance by the Company with all of
the provisions of this Subscription Agreement and the consummation of the
transactions contemplated herein will not conflict with or result in a breach or
violation of any of the terms or provisions of, or constitute a default under,
or result in the creation or imposition of any lien, charge or encumbrance upon
any of the property or assets of the Company pursuant to the terms of (i) any
indenture, mortgage, deed of trust, loan agreement, lease, license or other
agreement or instrument to which the Company is a party or by which the Company
is bound or to which any of the property or assets of the Company is subject;
(ii) the organizational documents of the Company; or (iii) any statute or any
judgment, order, rule or regulation of any court or governmental agency or body,
domestic or foreign, having jurisdiction over the Company or any of its
properties that, in the case of clauses (i) and (iii), would reasonably be
expected to have a Company Material Adverse Effect or have a material adverse
effect on the Company’s ability to consummate the transactions contemplated
hereby, including the issuance and sale of the Subscribed Shares.

 

e.       Assuming the accuracy of the representations and warranties of the
Subscriber, the Company is not required to obtain any consent, waiver,
authorization or order of, give any notice to, or make any filing or
registration with, any court or other federal, state, local or other
governmental authority, self-regulatory organization (including The Nasdaq Stock
Market (“Nasdaq”)) or other person in connection with the execution, delivery
and performance of this Subscription Agreement (including, without limitation,
the issuance of the Subscribed Shares), other than (i) filings required by
applicable state securities laws, (ii) the filing of the Registration Statement
pursuant to Section 5 below, (iii) the filing of a Notice of Exempt Offering of
Securities on Form D with the United States Securities and Exchange Commission
(“Commission”) under Regulation D of the Securities Act of 1933, as amended (the
“Securities Act”), (iv) those required by Nasdaq, including with respect to
obtaining shareholder approval, (v) those required to consummate the Transaction
as provided under the Transaction Agreement, (vi) the filing of notification
under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, if applicable,
and (vii) the failure of which to obtain would not be reasonably likely to have
a Company Material Adverse Effect or have a material adverse effect on the
Company’s ability to consummate the transactions contemplated hereby, including
the issuance and sale of the Subscribed Shares.

 

f.        As of their respective dates, all reports required to be filed by the
Company with the Commission (the “SEC Reports”) complied in all material
respects with the requirements of the Securities Act and the Securities Exchange
Act of 1934, and the rules and regulations of the Commission promulgated
thereunder, and none of the SEC Reports, when filed, contained any untrue
statement of a material fact or omitted to state a material fact required to be
stated therein or necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading. The
financial statements of the Company included in the SEC Reports comply in all
material respects with applicable accounting requirements and the rules and
regulations of the Commission with respect thereto as in effect at the time of
filing and fairly present in all material respects the financial position of the
Company as of and for the dates thereof and the results of operations and cash
flows for the periods then ended, subject, in the case of unaudited statements,
to normal, year-end audit adjustments.

 

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g.      As of the date hereof, the authorized share capital of the Company
consists of 380,000,000 Class A Shares, 20,000,000 shares of Class B common
stock, par value $0.0001 per share (“Class B Shares” and together with the Class
A Shares, “Common Stock”) and 1,000,000 preferred shares, par value $0.0001 per
share (“Preferred Shares”). As of the Closing Date (and immediately after the
consummation of the Transaction), the authorized share capital of the Company
will consist of 1,800,000,000 shares of common stock, consisting of 900,000,000
shares of Class A common stock and 900,000,000 shares of Class B common stock,
and 300,000,000 shares of preferred stock, par value of $0.0001 per share. As of
the date hereof: (i) 40,000,000 Class A Shares, 10,000,000 Class B Shares and no
Preferred Shares were issued and outstanding; (ii) 19,666,667 warrants, each
exercisable to purchase one Class A Share at $11.50 per share (“Warrants”), were
issued and outstanding, including 6,333,334 private placement warrants; and
(iii) no Common Stock was subject to issuance upon exercise of outstanding
options. No Warrants are exercisable on or prior to the Closing. All (i) issued
and outstanding Common Stock has been duly authorized and validly issued, is
fully paid and non-assessable and is not subject to preemptive rights and
(ii) outstanding Warrants have been duly authorized and validly issued, are
fully paid and are not subject to preemptive rights. As of the date hereof,
except as set forth above and pursuant to (i) the Other Subscription Agreements,
and (ii) the Transaction Agreement, there are no outstanding options, warrants
or other rights to subscribe for, purchase or acquire from the Company any
Common Stock or other equity interests in the Company (collectively, “Equity
Interests”) or securities convertible into or exchangeable or exercisable for
Equity Interests. As of the date hereof, the Company has no subsidiaries and
does not own, directly or indirectly, interests or investments (whether equity
or debt) in any person, whether incorporated or unincorporated. There are no
stockholder agreements, voting trusts or other agreements or understandings to
which the Company is a party or by which it is bound relating to the voting of
any Equity Interests, other than (A) the letter agreements entered into by the
Company in connection with the Company’s initial public offering on May 10, 2019
pursuant to which Eagle Equity Partners, LLC and the Company’s executive
officers and independent directors agreed to vote in favor of any proposed
Business Combination (as defined therein), which includes the Transaction, and
(B) as contemplated by the Transaction Agreement. Other than Class B Shares,
which have the anti-dilution rights described in the Company’s certificate of
incorporation, there are no securities or instruments issued by or to which the
Company is a party containing anti-dilution or similar provisions that will be
triggered by the issuance of (i) the Subscribed Shares or (ii) the shares to be
issued pursuant to any Other Subscription Agreement.

 

h.      Except for such matters as have not had and would not be reasonably
likely to have a Company Material Adverse Effect or have a material adverse
effect on the Company’s ability to consummate the transactions contemplated
hereby, including the issuance and sale of the Subscribed Shares, as of the date
hereof, there is no (i) suit, action, proceeding or arbitration before a
governmental authority or arbitrator pending, or, to the knowledge of the
Company, threatened in writing against the Company or (ii) judgment, decree,
injunction, ruling or order of any governmental authority or arbitrator
outstanding against the Company.

 

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i.        The issued and outstanding Class A Shares are registered pursuant to
Section 12(b) of the Securities Exchange Act of 1934, as amended (the “Exchange
Act”), and are listed for trading on Nasdaq under the symbol “DEAC.” There is no
suit, action, proceeding or investigation pending or, to the knowledge of the
Company, threatened against the Company by Nasdaq or the Commission with respect
to any intention by such entity to deregister the Class A Shares or prohibit or
terminate the listing of the Class A Shares on Nasdaq. The Company has taken no
action that is designed to terminate the registration of the Class A Shares
under the Exchange Act.

 

j.        Upon consummation of the Transaction, the issued and outstanding Class
A Shares will be registered pursuant to Section 12(b) of the Exchange Act and
will be listed for trading on Nasdaq.

 

k.      Assuming the accuracy of Subscriber’s representations and warranties set
forth in Section 4 of this Subscription Agreement, no registration under the
Securities Act is required for the offer and sale of the Subscribed Shares by
the Company to Subscriber.

 

l.        Neither the Company nor any person acting on its behalf has engaged or
will engage in any form of general solicitation or general advertising (within
the meaning of Regulation D) in connection with any offer or sale of the
Subscribed Shares.

 

4.      Subscriber Representations and Warranties. Subscriber represents and
warrants to the Company that:

 

a.       Subscriber (i) is duly organized, validly existing and in good standing
under the laws of its jurisdiction of incorporation, and (ii) has the requisite
power and authority to enter into and perform its obligations under this
Subscription Agreement.

 

b.      This Subscription Agreement has been duly executed and delivered by
Subscriber, and assuming the due authorization, execution and delivery of the
same by the Company, this Subscription Agreement shall constitute the valid and
legally binding obligation of Subscriber, enforceable against Subscriber in
accordance with its terms, except as such enforceability may be limited by
bankruptcy, insolvency, reorganization, moratorium and similar laws affecting
creditors generally and by the availability of equitable remedies.

 

c.       The execution and delivery of this Subscription Agreement, the purchase
of the Subscribed Shares and the compliance by Subscriber with all of the
provisions of this Subscription Agreement and the consummation of the
transactions contemplated herein will not conflict with or result in a breach or
violation of any of the terms or provisions of, or constitute a default under,
or result in the creation or imposition of any lien, charge or encumbrance upon
any of the property or assets of Subscriber pursuant to the terms of (i) any
indenture, mortgage, deed of trust, loan agreement, lease, license or other
agreement or instrument to which Subscriber is a party or by which Subscriber is
bound or to which any of the property or assets of Subscriber is subject;
(ii) the organizational documents of Subscriber; or (iii) any statute or any
judgment, order, rule or regulation of any court or governmental agency or body,
domestic or foreign, having jurisdiction over Subscriber or any of its
properties that, in the case of clauses (i) and (iii), would reasonably be
expected to have a Subscriber Material Adverse Effect. For purposes of this
Subscription Agreement, a “Subscriber Material Adverse Effect” means an event,
change, development, occurrence, condition or effect with respect to Subscriber
that would reasonably be expected to have a material adverse effect on
Subscriber’s ability to consummate the transactions contemplated hereby,
including the purchase of the Subscribed Shares.

 

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d.      Subscriber (i) is an institutional “accredited investor” (within the
meaning of Rule 501(a) under the Securities Act) satisfying the applicable
requirements set forth on Annex A, (ii) is acquiring the Subscribed Shares only
for its own account and not for the account of others, or if Subscriber is
subscribing for the Subscribed Shares as a fiduciary or agent for one or more
investor accounts, each owner of such account is a qualified institutional buyer
and Subscriber has full investment discretion with respect to each such account,
and the full power and authority to make the acknowledgements, representations
and agreements herein on behalf of each owner of each such account, and (iii) is
not acquiring the Subscribed Shares with a view to, or for offer or sale in
connection with, any distribution thereof in violation of the Securities Act
(and has provided the Company with the requested information
on Annex A following the signature page hereto). Subscriber is not an entity
formed for the specific purpose of acquiring the Subscribed Shares.

 

e.       Subscriber understands that the Subscribed Shares are being offered in
a transaction not involving any public offering within the meaning of the
Securities Act and that the Subscribed Shares have not been registered under the
Securities Act. Subscriber understands that the Subscribed Shares may not be
resold, transferred, pledged or otherwise disposed of by Subscriber absent an
effective registration statement under the Securities Act, except (i) to the
Company or a subsidiary thereof, or (ii) pursuant to an applicable exemption
from the registration requirements of the Securities Act, and, in each of cases
(i) and (ii), in accordance with any applicable securities laws of the states
and other jurisdictions of the United States.

 

f.       Subscriber understands and agrees that Subscriber is purchasing the
Subscribed Shares directly from the Company. Subscriber further acknowledges
that there have not been, and Subscriber hereby agrees that it is not relying
on, any representations, warranties, covenants and agreements made to Subscriber
by the Company, any other party to the Transaction or any other person or
entity, expressly or by implication, other than those representations,
warranties, covenants and agreements of the Company set forth in this
Subscription Agreement. Subscriber acknowledges that certain information
provided by the Company was based on projections, and such projections were
prepared based on assumptions and estimates that are inherently uncertain and
are subject to a wide variety of significant business, economic and competitive
risks and uncertainties that could cause actual results to differ materially
from those contained in the projections.

 

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g.       In making its decision to purchase the Subscribed Shares, Subscriber
has relied solely upon independent investigation made by Subscriber. Subscriber
acknowledges and agrees that Subscriber has received such information as
Subscriber deems necessary in order to make an investment decision with respect
to the Subscribed Shares, including with respect to the Company and the
Transaction (including DK and SBT and their respective subsidiaries
(collectively, the “Acquired Companies”)). Subscriber represents and agrees that
Subscriber and Subscriber’s professional advisor(s), if any, have had the full
opportunity to ask such questions, receive such answers and obtain such
information as Subscriber and such undersigned’s professional advisor(s), if
any, have deemed necessary to make an investment decision with respect to the
Subscribed Shares. Subscriber acknowledges and agrees that neither Goldman Sachs
& Co. LLC or Credit Suisse AG, acting as placement agents to the Company (each,
a “Placement Agent” and, collectively, the “Placement Agents”), nor any
affiliate of any Placement Agent has provided Subscriber with any information or
advice with respect to the Subscribed Shares nor is such information or advice
necessary or desired. Neither Placement Agent nor any of their respective
affiliates has made or makes any representation as to the Company or the
Acquired Companies or the quality or value of the Subscribed Shares and the
Placement Agents and any of their respective affiliates may have acquired
non-public information with respect to the Company or the Acquired Companies
which Subscriber agrees need not be provided to it. In connection with the
issuance of the Subscribed Shares to Subscriber, neither the Placement Agent nor
any of its affiliates has acted as a financial advisor or fiduciary to
Subscriber.

 

h.       Subscriber became aware of this offering of the Subscribed Shares
solely by means of direct contact between Subscriber and the Company or by means
of contact from a Placement Agent and the Subscribed Shares were offered to
Subscriber solely by direct contact between Subscriber and the Company.
Subscriber did not become aware of this offering of the Subscribed Shares, nor
were the Subscribed Shares offered to Subscriber, by any other means. Subscriber
acknowledges that the Company represents and warrants that the Subscribed Shares
(i) were not offered by any form of general solicitation or general advertising
and (ii) are not being offered in a manner involving a public offering under, or
in a distribution in violation of, the Securities Act, or any state securities
laws.

 

i.        Subscriber acknowledges that it is aware that there are substantial
risks incident to the purchase and ownership of the Subscribed Shares, including
those made available to Subscriber on November 21, 2019. Subscriber has such
knowledge and experience in financial and business matters as to be capable of
evaluating the merits and risks of an investment in the Subscribed Shares, and
Subscriber has had an opportunity to seek, and has sought, such accounting,
legal, business and tax advice as Subscriber has considered necessary to make an
informed investment decision.

 

j.        Subscriber has adequately analyzed and fully considered the risks of
an investment in the Subscribed Shares and determined that the Subscribed Shares
are a suitable investment for Subscriber and that Subscriber is able at this
time and in the foreseeable future to bear the economic risk of a total loss of
Subscriber’s investment in the Company. Subscriber acknowledges specifically
that a possibility of total loss exists.

 

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k.       Subscriber understands and agrees that no federal or state agency has
passed upon or endorsed the merits of the offering of the Subscribed Shares or
made any findings or determination as to the fairness of this investment.

 

l.        Subscriber is not (i) a person or entity named on the List of
Specially Designated Nationals and Blocked Persons administered by the U.S.
Treasury Department’s Office of Foreign Assets Control (“OFAC”) or in any
Executive Order issued by the President of the United States and administered by
OFAC (“OFAC List”), or a person or entity prohibited by any OFAC sanctions
program, (ii) a Designated National as defined in the Cuban Assets Control
Regulations, 31 C.F.R. Part 515, or (iii) a non-U.S. shell bank or providing
banking services indirectly to a non-U.S. shell bank (collectively, a
“Prohibited Investor”). Subscriber agrees to provide law enforcement agencies,
if requested thereby, such records as required by applicable law, provided that
Subscriber is permitted to do so under applicable law. Subscriber represents
that if it is a financial institution subject to the Bank Secrecy Act (31 U.S.C.
Section 5311 et seq.), as amended by the USA PATRIOT Act of 2001 and its
implementing regulations (collectively, the “BSA/PATRIOT Act”), that Subscriber
maintains policies and procedures reasonably designed to comply with applicable
obligations under the BSA/PATRIOT Act. Subscriber also represents that, to the
extent required, it maintains policies and procedures reasonably designed for
the screening of its investors against the OFAC sanctions programs, including
the OFAC List. Subscriber further represents and warrants that, to the extent
required, it maintains policies and procedures reasonably designed to ensure
that the funds held by Subscriber and used to purchase the Subscribed Shares
were legally derived.

 

m.      Subscriber does not have, as of the date hereof, and during the 30-day
period immediately prior to the date hereof such Subscriber has not entered
into, any “put equivalent position” as such term is defined in Rule 16a-1 under
the Exchange Act or short sale positions with respect to the securities of the
Company.

 

n.       If Subscriber is an employee benefit plan that is subject to Title I of
ERISA, a plan, an individual retirement account or other arrangement that is
subject to section 4975 of the Code or an employee benefit plan that is a
governmental plan (as defined in section 3(32) of ERISA), a church plan (as
defined in section 3(33) of ERISA), a non-U.S. plan (as described in section
4(b)(4) of ERISA) or other plan that is not subject to the foregoing but may be
subject to provisions under any other federal, state, local, non-U.S. or other
laws or regulations that are similar to such provisions of ERISA or the Internal
Revenue Code of 1986, as amended, or an entity whose underlying assets are
considered to include “plan assets” of any such plan, account or arrangement
(each, a “Plan”) subject to the fiduciary or prohibited transaction provisions
of ERISA or section 4975 of the Code, Subscriber represents and warrants that
neither the Company, nor any of its respective affiliates (the “Transaction
Parties”) has acted as the Plan’s fiduciary, or has been relied on for advice,
with respect to its decision to acquire and hold the Subscribed Shares, and none
of the Transaction Parties shall at any time be relied upon as the Plan’s
fiduciary with respect to any decision to acquire, continue to hold or transfer
the Subscribed Shares.

 

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o.       Subscriber at the Closing will have sufficient funds to pay the
Purchase Price pursuant to Section 2(a).

 

p.      Subscriber agrees that, notwithstanding Section 8(i), the Placement
Agents may rely upon the representations and warranties made by Subscriber to
the Company in this Subscription Agreement.

 

5.      Registration of Subscribed Shares and Incentive Warrants.

 

a.       In connection with the Transaction and the NV Conversion, the Company
will file a Registration Statement on Form S-4 (the “Registration Statement”) to
register (i) all of the issued and outstanding shares of Common Stock, including
the Subscribed Shares, and (ii) the Incentive Warrants, including the shares of
Common Stock underlying the Incentive Warrants. Following the registration of
the Subscribed Shares and Incentive Warrants pursuant to the Registration
Statement, the effectiveness of the NV Conversion and the closing of the
Transaction, the Subscribed Shares and the Incentive Warrants will be freely
tradable in the hands of persons other than DEAC’s affiliates.

 

b.       Subscriber shall not execute any short sales or engage in other hedging
transactions of any kind with respect to securities of the Company during the
period from the date of this Subscription Agreement through the Closing.

 

6.      Termination. This Subscription Agreement shall terminate and be void and
of no further force and effect, and all rights and obligations of the parties
hereunder shall terminate without any further liability on the part of any party
in respect thereof, upon the earlier to occur of (a) such date and time as the
Transaction Agreement is terminated in accordance with its terms, (b) upon the
mutual written agreement of the Company and the Subscriber to terminate this
Subscription Agreement, (c) if, on the Closing Date of the Transaction, any of
the conditions to Closing set forth in Section 2 of this Subscription Agreement
have not been satisfied as of the time required hereunder to be so satisfied or
waived by the party entitled to grant such waiver and, as a result thereof, the
transactions contemplated by this Subscription Agreement are not consummated, or
(d) May 15, 2020 (the “Outside Date”); provided, that nothing herein will
relieve any party from liability for any willful breach hereof prior to the time
of termination, and each party will be entitled to any remedies at law or in
equity to recover losses, liabilities or damages arising from such breach. The
Company shall notify Subscriber of the termination of the Transaction Agreement
promptly after the termination thereof.

 

7.      Trust Account Waiver. Subscriber hereby acknowledges that the Company
has established a trust account (the “Trust Account”) containing the proceeds of
its initial public offering (the “IPO”) and from certain private placements
occurring simultaneously with the IPO (including interest accrued from time to
time thereon) for the benefit of the Company’s public shareholders and certain
other parties (including the underwriters of the IPO). For and in consideration
of the Company entering into this Subscription Agreement, and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, Subscriber hereby (i) agrees that it does not now and shall not at
any time hereafter have any right, title, interest or claim of any kind in or to
any assets held in the Trust Account, and shall not make any claim against the
Trust Account, regardless of whether such claim arises as a result of, in
connection with or relating in any way to this Subscription Agreement or any
other matter, and regardless of whether such claim arises based on contract,
tort, equity or any other theory of legal liability (any and all such claims are
collectively referred to hereafter as the “Released Claims”), (ii) irrevocably
waives any Released Claims that it may have against the Trust Account now or in
the future as a result of, or arising out of, any negotiations, contracts or
agreements with the Company, and (iii) will not seek recourse against the Trust
Account for any reason whatsoever; provided however, that nothing in this
Section 7 shall be deemed to limit any Subscriber’s right to distributions from
the Trust Account in accordance with the Company’s amended and restated
certificate of incorporation in respect of Common Stock of the Company acquired
by any means other than pursuant to this Subscription Agreement.

 

11

 

 

8.      Miscellaneous.

 

a.       All notices, requests, demands, claims, and other communications
hereunder shall be in writing. Any notice, request, demand, claim, or other
communication hereunder shall be deemed duly given (i) when delivered personally
to the recipient, (ii) when sent by electronic mail, on the date of transmission
to such recipient; provided, that such notice, request, demand, claim or other
communication is also sent to the recipient pursuant to clauses (i), (iii) or
(iv) of this Section 8(a), (iii) one Business Day after being sent to the
recipient by reputable overnight courier service (charges prepaid), or (iv) four
(4) Business Days after being mailed to the recipient by certified or registered
mail, return receipt requested and postage prepaid, and, in each case, addressed
to the intended recipient at its address specified on the signature page hereof
or to such electronic mail address or address as subsequently modified by
written notice given in accordance with this Section 8(a).

 

b.       Subscriber acknowledges that the Company and others will rely on the
acknowledgments, understandings, agreements, representations and warranties
contained in this Subscription Agreement. Prior to the Closing, Subscriber
agrees to promptly notify the Company if it becomes aware that any of the
acknowledgments, understandings, agreements, representations and warranties of
Subscriber set forth herein are no longer accurate in all material respects. The
Company acknowledges that Subscriber and others will rely on the
acknowledgments, understandings, agreements, representations and warranties
contained in this Subscription Agreement. Prior to the Closing, the Company
agrees to promptly notify Subscriber if it becomes aware that any of the
acknowledgments, understandings, agreements, representations and warranties of
the Company set forth herein are no longer accurate in all material respects.

 

c.       Each of the Company and Subscriber is irrevocably authorized to produce
this Subscription Agreement or a copy hereof to any interested party in any
administrative or legal proceeding or official inquiry with respect to the
matters covered hereby.

 

d.       Subscriber shall pay all of its own expenses in connection with this
Subscription Agreement and the transactions contemplated herein.

 

12

 

 

e.       Neither this Subscription Agreement nor any rights that may accrue to
Subscriber hereunder (other than the Subscribed Shares acquired hereunder, if
any) may be transferred or assigned. Neither this Subscription Agreement nor any
rights that may accrue to the Company hereunder may be transferred or assigned
(provided, that, for the avoidance of doubt, the Company may transfer the
Subscription Agreement and its rights hereunder in connection with the
consummation of the NV Conversion and the Transaction). Notwithstanding the
foregoing, Subscriber may assign its rights and obligations under this
Subscription Agreement to one or more of its affiliates or, with the Company’s
prior written consent, to another person, provided that no such assignment shall
relieve Subscriber of its obligations hereunder if any such assignee fails to
perform such obligations.

 

f.        All the agreements, representations and warranties made by each party
hereto in this Subscription Agreement shall survive the Closing.

 

g.      The Company may request from Subscriber such additional information as
the Company may deem necessary to evaluate the eligibility of Subscriber to
acquire the Subscribed Shares, and Subscriber shall provide such information as
may be reasonably requested, to the extent readily available and to the extent
consistent with its internal policies and procedures.

 

h.      This Subscription Agreement may not be amended, modified, waived or
terminated except by an instrument in writing, signed by the party against whom
enforcement of such modification, waiver, or termination is sought; provided,
that, this Subscription Agreement may be amended, modified, waived or terminated
with the written consent of the Company and the Subscribers then holding a
majority of the Collective Subscribed Shares then committed to be purchased at
the Closing by (or, if after the Closing, then held by) all Subscribers (the
“Required Subscribers”). Upon the effectuation of such waiver, modification,
amendment or termination with the consent of the Required Subscribers in
conformance with this Section 8(h), such amendment, modification, waiver or
termination shall be binding on all Subscribers and effective as to all of the
Subscription Agreements. The Company shall promptly give written notice thereof
to Subscriber if Subscriber has not previously consented to such amendment,
modification, waiver or termination in writing; provided that the failure to
give such notice shall not affect the validity of such amendment, modification,
waiver or termination. Notwithstanding anything to the contrary herein, (i) no
amendment, modification or waiver shall be effective against any Subscriber
unless such amendment, modification or waiver applies to all Subscribers
equally, (ii) any amendment, modification or waiver that has a disproportionate
effect on a Subscriber (considered apart from any disproportionate effect owing
to the number of Subscribed Shares held by such Subscriber), shall require the
consent of such Subscriber and (iii) any amendment to Section 3(i), Section 5,
or Section 6 (to extend the Outside Date beyond May 30, 2020) of this
Subscription Agreement shall require the consent of the undersigned Subscriber.

 

i.        This Subscription Agreement constitutes the entire agreement, and
supersedes all other prior agreements, understandings, representations and
warranties, both written and oral, among the parties, with respect to the
subject matter hereof. This Subscription Agreement shall not confer any rights
or remedies upon any person other than the parties hereto and their respective
permitted successors and assigns.

 

13

 

 

j.        Except as otherwise provided herein, this Subscription Agreement shall
be binding upon, and inure to the benefit of the parties hereto and their heirs,
executors, administrators, successors, legal representatives, and permitted
assigns, and the agreements, representations, warranties, covenants and
acknowledgments contained herein shall be deemed to be made by, and be binding
upon, such heirs, executors, administrators, successors, legal representatives
and permitted assigns.

 

k.       If any provision of this Subscription Agreement shall be invalid,
illegal or unenforceable, the validity, legality or enforceability of the
remaining provisions of this Subscription Agreement shall not in any way be
affected or impaired thereby and shall continue in full force and effect.

 

l.        This Subscription Agreement may be executed and delivered in one or
more counterparts (including by facsimile or electronic mail or in .pdf) and by
different parties in separate counterparts, with the same effect as if all
parties hereto had signed the same document. All counterparts so executed and
delivered shall be construed together and shall constitute one and the same
agreement.

 

m.      This Subscription Agreement is intended for the benefit of the parties
hereto and their respective successors and permitted assigns and is not for the
benefit of, nor may any provision hereof be enforced by, any other person;
provided, however, that the Placement Agents shall be intended third party
beneficiaries of the representations and warranties of the Company in Section 3
hereof and of the Subscribers in Section 4 hereof.

 

n.       The parties hereto agree that irreparable damage would occur in the
event that any of the provisions of this Subscription Agreement were not
performed in accordance with their specific terms or were otherwise breached. It
is accordingly agreed that the parties shall be entitled to an injunction or
injunctions to prevent breaches of this Subscription Agreement and to enforce
specifically the terms and provisions of this Subscription Agreement, this being
in addition to any other remedy to which such party is entitled at law, in
equity, in contract, in tort or otherwise.

 

o.       This Subscription Agreement shall be governed by, and construed in
accordance with, the laws of the state of Delaware, without regard to the
principles of conflicts of laws that would otherwise require the application of
the law of any other state.

 

p.       EACH PARTY HEREBY WAIVES ITS RESPECTIVE RIGHTS TO A TRIAL BY JURY OF
ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OR RELATED TO THIS
SUBSCRIPTION AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY IN ANY ACTION,
PROCEEDING OR OTHER LITIGATION OF ANY TYPE BROUGHT BY ANY PARTY AGAINST ANY
OTHER PARTY OR ANY AFFILIATE OF ANY OTHER SUCH PARTY, WHETHER WITH RESPECT TO
CONTRACT CLAIMS, TORT CLAIMS OR OTHERWISE. THE PARTIES AGREE THAT ANY SUCH CLAIM
OR CAUSE OF ACTION SHALL BE TRIED BY A COURT TRIAL WITHOUT A JURY. WITHOUT
LIMITING THE FOREGOING, THE PARTIES FURTHER AGREE THAT THEIR RESPECTIVE RIGHT TO
A TRIAL BY JURY IS WAIVED BY OPERATION OF THIS SECTION AS TO ANY ACTION,
COUNTERCLAIM OR OTHER PROCEEDING WHICH SEEKS, IN WHOLE OR IN PART, TO CHALLENGE
THE VALIDITY OR ENFORCEABILITY OF THIS SUBSCRIPTION AGREEMENT OR ANY PROVISION
HEREOF. THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS,
SUPPLEMENTS OR MODIFICATIONS TO THIS SUBSCRIPTION AGREEMENT.

 

14

 

 

q.      The parties agree that all disputes, legal actions, suits and
proceedings arising out of or relating to this Subscription Agreement must be
brought exclusively in the Court of Chancery of the state of Delaware and any
state appellate court therefrom within the state of Delaware (or, if the Court
of Chancery of the state of Delaware declines to accept jurisdiction over a
particular matter, any federal court within the state of Delaware or, in the
event each federal court within the state of Delaware declines to accept
jurisdiction over a particular matter, any state court within the state of
Delaware) (collectively the “Designated Courts”). Each party hereby consents and
submits to the exclusive jurisdiction of the Designated Courts. No legal action,
suit or proceeding with respect to this subscription agreement may be brought in
any other forum. Each party hereby irrevocably waives all claims of immunity
from jurisdiction and any objection which such party may now or hereafter have
to the laying of venue of any suit, action or proceeding in any Designated
Court, including any right to object on the basis that any dispute, action, suit
or proceeding brought in the Designated Courts has been brought in an improper
or inconvenient forum or venue. Each of the parties also agrees that delivery of
any process, summons, notice or document to a party hereof in compliance with
Section 8(a) of this Subscription Agreement shall be effective service of
process for any action, suit or proceeding in a Designated Court with respect to
any matters to which the parties have submitted to jurisdiction as set forth
above.

 

r.        This Subscription Agreement may only be enforced against, and any
claim, action, suit or other legal proceeding based upon, arising out of, or
related to this Subscription Agreement, or the negotiation, execution or
performance of this Subscription Agreement, may only be brought against the
entities that are expressly named as parties hereto and then only with respect
to the specific obligations set forth herein with respect to such party. No
past, present or future director, officer, employee, incorporator, manager,
member, partner, stockholder, affiliate, agent, attorney or other representative
of any party hereto or of any affiliate of any party hereto, or any of their
successors or permitted assigns, shall have any liability for any obligations or
liabilities of any party hereto under this Subscription Agreement or for any
claim, action, suit or other legal proceeding based on, in respect of or by
reason of the transactions contemplated hereby.

 

s.       The Company shall, by 9:00 a.m., New York City time, on the first (1st)
business day immediately following the date of this Subscription Agreement,
issue one or more press releases or file with the Commission a Current Report on
Form 8-K (collectively, the “Disclosure Document”) disclosing, to the extent not
previously publicly disclosed, all material terms of the transactions
contemplated hereby (and by the Other Subscription Agreements), the Transaction
and any other material, nonpublic information that the Company has provided to
Subscriber at any time prior to the filing of the Disclosure Document. From and
after the issuance of the Disclosure Document, Subscriber shall not be in
possession of any material, non-public information received from the Company or
any of its officers, directors or employees or the Placement Agents.
Notwithstanding the foregoing, the Company shall not publicly disclose the name
of Subscriber or any affiliate or investment adviser of Subscriber, or include
the name of Subscriber or any affiliate or investment adviser of Subscriber in
any press release or in any filing with the Commission or any regulatory agency
or trading market, without the prior written consent (including by e-mail) of
Subscriber, except as required by the federal securities laws, rules or
regulations and to the extent such disclosure is required by other laws, rules
or regulations, at the request of the staff of the Commission or regulatory
agency or under Nasdaq regulations, in which case the Company shall provide
Subscriber with prior written notice (including by e-mail) of such permitted
disclosure, and shall reasonably consult with Subscriber regarding such
disclosure.

 

15

 

 

t.        The obligations of Subscriber under this Subscription Agreement are
several and not joint with the obligations of any Other Subscriber or any other
investor under the Other Subscription Agreements, and Subscriber shall not be
responsible in any way for the performance of the obligations of any Other
Subscriber under this Subscription Agreement or any other investor under the
Other Subscription Agreements. The decision of Subscriber to purchase Subscribed
Shares pursuant to this Subscription Agreement has been made by Subscriber
independently of any Other Subscriber or any other investor and independently of
any information, materials, statements or opinions as to the business, affairs,
operations, assets, properties, liabilities, results of operations, condition
(financial or otherwise) or prospects of the Company or any of its subsidiaries
which may have been made or given by any Other Subscriber or investor or by any
agent or employee of any Other Subscriber or investor, and neither Subscriber
nor any of its agents or employees shall have any liability to any Other
Subscriber or investor (or any other person) relating to or arising from any
such information, materials, statements or opinions. Nothing contained herein or
in any Other Subscription Agreement, and no action taken by Subscriber or
investor pursuant hereto or thereto, shall be deemed to constitute the
Subscriber and other investors as a partnership, an association, a joint venture
or any other kind of entity, or create a presumption that the Subscriber and
other investors are in any way acting in concert or as a group with respect to
such obligations or the transactions contemplated by the this Subscription
Agreement and the Other Subscription Agreements. Subscriber acknowledges that no
Other Subscriber has acted as agent for the Subscriber in connection with making
its investment hereunder and no Other Subscriber will be acting as agent of the
Subscriber in connection with monitoring its investment in the Subscribed Shares
or enforcing its rights under this Subscription Agreement. Subscriber shall be
entitled to independently protect and enforce its rights, including without
limitation the rights arising out of this Subscription Agreement, and it shall
not be necessary for any Other Subscriber or investor to be joined as an
additional party in any proceeding for such purpose.

 

16

 

 

[Signature pages follow.]

 

17

 

 

 

IN WITNESS WHEREOF, each of the Company and Subscriber has executed or caused
this Subscription Agreement to be executed by its duly authorized representative
as of the date first set forth above.

 

  DIAMOND EAGLE ACQUISITION CORP.               By:         Name:     Title:    
    Address for Notices:         2121 Avenue of the Stars, Suite 2300   Los
Angeles, CA 90067

 

18

 

 

SUBSCRIBER:     
                                                                                                                              
                  Print Name:                

 

  By:          Name:     Title:         Address for Notices:                    
    Name in which shares are to be registered:    

 

            Number of Subscribed Shares subscribed for: _____________________  
      Price Per Subscribed Share: $10.00         Aggregate Purchase Price:
$____________________  

 

You must pay the Purchase Price by wire transfer of United States dollars in
immediately available funds to the account of the Company specified by the
Company in the Closing Notice.

 

19

 

 

ANNEX A

 

ELIGIBILITY REPRESENTATIONS OF SUBSCRIBER 

 

This Annex A should be completed and signed by Subscriber
and constitutes a part of the Subscription Agreement.

 

A.INSTITUTIONAL ACCREDITED INVESTOR STATUS (Please check the box)

 

¨Subscriber is an institutional “accredited investor” (within the meaning of
Rule 501(a) under the Securities Act) or an entity in which all of the equity
holders are accredited investors within the meaning of Rule 501(a) under the
Securities Act, and has marked and initialed the appropriate box on the
following page indicating the provision under which it qualifies as an
“accredited investor.”

 

   B. AFFILIATE STATUS
(Please check the applicable box)

 

SUBSCRIBER:

 

¨ is:

 

¨ is not:

 

an “affiliate” (as defined in Rule 144 under the Securities Act) of the Company
or acting on behalf of an affiliate of the Company.

 

 

 

 

Rule 501(a), in relevant part, states that an “accredited investor” shall mean
any person who comes within any of the below listed categories, or who the
issuer reasonably believes comes within any of the below listed categories, at
the time of the sale of the securities to that person. Subscriber has indicated,
by marking and initialing the appropriate box below, the provision(s) below
which apply to Subscriber and under which Subscriber accordingly qualifies as an
institutional “accredited investor.”

 

¨Any bank, registered broker or dealer, insurance company, registered investment
company, business development company, or small business investment company; 

 

¨Any plan established and maintained by a state, its political subdivisions, or
any agency or instrumentality of a state or its political subdivisions for the
benefit of its employees, if such plan has total assets in excess of
$5,000,000; 

 

¨Any employee benefit plan, within the meaning of the Employee Retirement Income
Security Act of 1974, if a bank, insurance company, or registered investment
adviser makes the investment decisions, or if the plan has total assets in
excess of $5,000,000; 

 

¨a corporation, similar business trust, partnership or any organization
described in Section 501(c)(3) of the Internal Revenue Code, not formed for the
specific purpose of acquiring the securities offered, with total assets in
excess of $5,000,000; 

 

¨Any trust with assets in excess of $5,000,000, not formed to acquire the
securities offered, whose purchase is directed by a sophisticated person; or 

 

¨Any entity in which all of the equity owners are accredited investors meeting
one or more of the above tests or one of the following tests.

 

[Specify which tests:                   ]

 

Any director, executive officer, or general partner of the issuer of the
securities being offered or sold, or any director, executive officer, or general
partner of a general partner of that issuer; 

 

Any natural person whose individual net worth, or joint net worth with that
person’s spouse, at the time of his purchase exceeds $1,000,000. For purposes of
calculating a natural person’s net worth: (a) the person’s primary residence
must not be included as an asset; (b) indebtedness secured by the person’s
primary residence up to the estimated fair market value of the primary residence
must not be included as a liability (except that if the amount of such
indebtedness outstanding at the time of calculation exceeds the amount
outstanding 60 days before such time, other than as a result of the acquisition
of the primary residence, the amount of such excess must be included as a
liability); and (c) indebtedness that is secured by the person’s primary
residence in excess of the estimated fair market value of the residence must be
included as a liability; or

 

2

 

 

Any natural person who had an individual income in excess of $200,000 in each of
the two most recent years or joint income with that person’s spouse in excess of
$300,000 in each of those years and has a reasonable expectation of reaching the
same income level in the current year. 

 

 

  SUBSCRIBER:   Print Name:                 By:              Name:     Title:  

 

3