UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
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Item 5.02 | Departure of Directors or Certain Officers; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. |
On August 12, 2021, Rush Street Interactive, Inc., a Delaware corporation (the “Company”), issued a press release to announce that, effective upon such date, Richard Schwartz, Co-Founder and President of the Company, has been appointed Chief Executive Officer of the Company and a Class II member of the Company’s board of directors (the “Board”), serving until the Company’s 2022 annual meeting of stockholders. Mr. Schwartz has replaced Greg Carlin, who will remain on the Board and has been appointed Vice Chairman. Mr. Schwartz’s biography appears in the Company’s 2021 proxy statement, filed with the SEC on May 11, 2021 and is incorporated by reference herein. A copy of the press release is provided as Exhibit 99.1 to this Current Report.
In connection with Mr. Carlin’s transition to Vice Chairman of the Board, the Company and Mr. Carlin entered into a letter agreement effective as of August 12, 2021 (the “Carlin Transition Letter”), pursuant to which Mr. Carlin agreed to forfeit one-third of the performance stock units, stock options and restricted stock units awarded to him on April 9, 2021 by the Company under the Company’s equity plan. Mr. Carlin is eligible to participate in the Company’s long-term incentive compensation plan, and will be granted a restricted stock award valued at $250,000 on the date of grant. The foregoing is not a complete description of the parties’ rights and obligations under the Carlin Transition Letter and is qualified by reference to the full text and terms of the agreement, which is filed as Exhibit 10.1 to this report and incorporated herein by reference. The Company and Mr. Schwartz are currently negotiating compensation terms regarding Mr. Schwartz’s appointment as Chief Executive Officer.
There are no arrangements or understandings between Mr. Schwartz and any other person pursuant to which Mr. Schwartz was appointed as Chief Executive Officer and a director of the Company. Mr. Schwartz does not have any family relationships with any director, executive officer or person nominated or chosen by the Company to become a director or executive officer of the Company. The Company is not aware of any related transactions or relationships between Mr. Schwartz and the Company that would require disclosure under Item 404(a) of Regulation S-K.
Additionally, on August 12, 2021, Sheli Rosenberg resigned as a member of the Board. Ms. Rosenberg did not advise the Company of any disagreement with the Company on any matter relating to its operations, policies or practices. Effective as of that date, Mr. Schwartz was appointed to the Board to fill the vacancy created upon Ms. Rosenberg’s departure.
Item 9.01 | Financial Statements and Exhibits. |
(d) Exhibits
Exhibit No. | Description | |
10.1 | Transition Letter Agreement, dated August 12, 2021 | |
99.1 | Press Release, dated August 12, 2021 | |
104 | Cover Page Interactive Data File (embedded within the Inline XBRL document). |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
RUSH STREET INTERACTIVE, INC. | ||
By: | /s/ Kyle Sauers | |
Name: Kyle Sauers | ||
Title: Chief Financial Officer | ||
Dated: August 12, 2021 |
Exhibit 10.1
Rush Street Interactive, Inc.
900 N. Michigan Avenue, Suite 950
Chicago, Illinois 60611
August 12, 2021
VIA ELECTRONIC MAIL
Gregory A. Carlin
c/o Rush Street Interactive, L.P.
900 N. Michigan Avenue, Suite 950
Chicago, Illinois 60611
Re: | Vice Chairman Appointment Letter from Rush Street Interactive, Inc. |
Dear Greg:
We are pleased to confirm your appointment as the non-executive Vice Chairman of the Board of Directors of Rush Street Interactive, Inc. (the “Company” and the Company’s board of directors the “Board”). The purpose of this letter agreement (this “Letter Agreement”) is to set forth the terms of your appointment as Vice Chairman of the Board. Effective as of the date hereof, your employment letter dated December 27, 2020 (the “2020 Agreement”) shall terminate and be of no further force and effect other than the “Non-Compete/Non-Solicitation” section of such agreement (which shall apply for twelve (12) months following the end of the Employment Period (as defined in the 2020 Agreement)) and the Employment Period shall terminate effective as of the date hereof and you shall no longer serve as Chief Executive Officer or as an employee of the Company or any of its direct or indirect subsidiaries. Other than the non-compete and non-solicitation covenants contained in the “Non-Compete/Non-Solicitation” section of the 2020 Agreement, the Company hereby waives the right to enforce any non-compete and non-solicitation covenants applicable to you contained in any equity award agreements or the Company's equity incentive plans, or any other agreement between the parties.
Compensation
Effective as of the date hereof, as Vice Chairman of the Board, you will be eligible to participate as a non-employee director, subject to its terms and conditions, in the Company’s equity incentive plan. The amount of your annual long-term incentives under the equity incentive plan is to be equal to $250,000 (but in no event less than the amount granted to other non-employee directors on the Board, excluding the Company’s Executive Chairman), which, as with the other directors receiving compensation, currently shall consist of restricted shares that vest upon and subject to your remaining as a director on the Board at the next annual shareholders meeting of the Company. Your ongoing service as a director on the Board shall constitute “Continuous Service” under the terms of the Company’s equity incentive plan.
Treatment of 2021 Cash Bonus and Existing 2021 Equity Awards
You were eligible to participate in the Company’s discretionary cash bonus plan upon the terms set forth in the 2020 Agreement. You will be entitled to a cash bonus for 2021 for the period during which you served as CEO in an amount equal to $240,000, which such amount shall be payable to you within five (5) business days of the date of this Letter Agreement. Further, you were granted and issued awards under the Company’s equity incentive plan in April 2021 consisting of performance stock units, stock options and restricted stock units. On the date hereof, you agree and hereby surrender one-third of each such award and will continue to hold the remainder of such awards on the terms set forth in the grant agreement(s) applicable to such awards (including vesting of such retained awards being subject to your remaining a director on the Board).
At-Will Appointment
Subject to the terms and conditions of this Letter Agreement, your appointment as Vice Chairman of the Board will be, at all times, at will. This means that you may resign as Vice Chairman at any time, and the Board may, in its sole discretion, terminate your appointment as Vice Chairman at any time without notice and for any reason or no reason at all. No one other than the Board has the authority to alter the at-will nature of your appointment as Vice Chairman, or to make any agreement that amends or alters the terms and conditions of this Letter Agreement and any such amendment or alteration must be in writing, must reference this Letter Agreement and must be signed a member of the Board authorized to so sign.
Applicable Law; Legal Remedies
This Letter Agreement, the rights and obligations of the parties hereto, and all claims or disputes relating thereto, shall be governed by and construed in accordance with the laws of the State of Illinois, without regard to the choice of law provisions thereof. Any controversy or claim arising out of or related to (i) this Letter Agreement, (ii) the breach thereof, or (iii) your employment with the Company or the termination of such employment, shall be settled by arbitration in Chicago, Illinois before a single arbitrator administered by the American Arbitration Association ("AAA") under its National Rules for the Resolution of Employment Disputes, amended and restated effective as of January 1, 2004, as the same may be amended, and judgment on the award rendered by the arbitrator may be entered in any court having jurisdiction thereof.
Compliance with Gaming Laws
As required by the statutes, rules and regulations relating to gaming where the Company and its subsidiaries and affiliates operates or is regulated (collectively, the “Gaming Laws”), you must timely obtain and maintain all permits or licenses required under the Gaming Laws. In addition, you agree to comply with all Gaming Laws applicable to you as a director of the Company as well as to assist the Company and its subsidiaries and affiliates, as necessary, in complying with the Gaming Laws.
2
Notwithstanding any other provision of this Letter Agreement, if you fail to comply with the Gaming Laws or if you are denied a required license or permit following the end of all applicable appeal periods, or if a regulator in a jurisdiction where the Company or its subsidiaries or affiliates operates or is regulated (or has applied for a license to operate) requires that your appointment be terminated or provides that your continued appointment as Vice Chairman shall create a gaming problem for the Company or its subsidiaries or affiliates, your appointment shall terminate immediately, without notice or action and without liability on the part of Company or its subsidiaries or affiliates.
By signing below, you represent and warrant that you are not currently a party to any agreement or other restriction that you would violate by accepting this offer and performing the duties contemplated by this Letter Agreement. This Letter Agreement constitutes the entire agreement between you and the Company and supersedes all prior agreements, understandings, or arrangements, whether oral or written, among the parties with respect to any matter related to this offer, including the 2020 Agreement.
[Signatures page to follow on next page.]
3
Please accept this Letter Agreement by signing this Letter Agreement where indicated and returning them to me.
Sincerely, | |
/s/ Neil Bluhm | |
Neil Bluhm | |
Chairman | |
Rush Street Interactive, Inc. |
I accept and agree to all terms and conditions of this Letter Agreement:
/s/ Gregory A. Carlin | August 12, 2021 | |
Gregory A. Carlin | Date |
4
Exhibit 99.1
RUSH STREET INTERACTIVE APPOINTS RICHARD SCHWARTZ CHIEF EXECUTIVE OFFICER; NAMES
GREG CARLIN VICE CHAIRMAN
Chicago, Illinois, August 12, 2021 — Rush Street Interactive, Inc. (NYSE: RSI) ("RSI" or the “Company”), a leading online casino and sports betting company in the United States, today announced that Richard Schwartz, Co-Founder and President, has been promoted to Chief Executive Officer and Greg Carlin has been named Vice Chairman, effective immediately. Mr. Schwartz will also join the Company’s Board of Directors (the “Board”).
Co-Founder and Executive Chairman of RSI Neil Bluhm commented, “Greg and I have worked alongside Richard since the inception of RSI and I have seen firsthand his immense skill and ingenuity as an executive. Richard’s vision has been integral in establishing RSI as a pioneer and nationwide leader in the online casino business, and there is no one better suited to continue to drive our strategic direction and growth. On behalf of the entire Board, I would like to thank Greg for his enduring contributions to the Company and I look forward to his continued partnership.”
Mr. Carlin said, “I am incredibly grateful to have had the opportunity to lead RSI from our founding through our listing as a publicly traded company, and I am proud of the incredible team we have built and our many accomplishments to date. Richard has been a key partner in building RSI’s award-winning proprietary technology platform and online operations. His deep understanding of the online gaming space and passion for our business will be critical in continuing to drive value for our shareholders for years to come. I believe now is the right time for me to transition to Vice Chairman and am excited to continue working with Richard and our highly experienced management team and Board to strengthen RSI’s industry leadership position."
Mr. Schwartz said, “I am honored to lead RSI at this time of tremendous growth for our Company and industry, and am humbled by the trust that Greg and the Board have placed in me. Greg has positioned RSI for success and our opportunities continue to expand, from new market launches to innovative product offerings and strategic marketing programs. As we look to the future, RSI will remain relentlessly focused on operational excellence and trying to delight our players with helpful, transparent customer service while refining our best-in-class technology platform.”
Richard Schwartz has been a leader and innovator in the gaming industry for nearly 20 years. He co-founded RSI in 2012 and has served as the Company’s President since inception. In this role, Mr. Schwartz has overseen the product, operations, business development, regulatory compliance, and legal functions for the company.
Prior to founding RSI, Mr. Schwartz started and led the interactive business for WMS Industries (now Scientific Games), which, in 2010, launched the award-winning UK-facing online casino business, Jackpot Party. He is an inventor on 50 US patents and has a deep understanding of player psychology. Before working in the gaming industry, Mr. Schwartz was an executive at Telecom Italia Lab USA (formerly Telecom Italia Ventures) and an intellectual property attorney in Silicon Valley. Mr. Schwartz received his AB from the University of California, Berkeley and received his JD from the University of California, Hastings College of the Law. He, along with Messrs. Bluhm and Carlin, were named Entrepreneurs of The Year® 2021 Midwest Award winners by Ernst & Young LLP.
About RSI
RSI is a trusted online gaming and sports entertainment company focused on regulated markets in the United States and Latin America. Through its brands, BetRivers.com and PlaySugarHouse.com, RSI was an early entrant in many regulated jurisdictions and is currently live with real-money mobile, online and/or retail operations in ten U.S. states: Pennsylvania, Illinois, New Jersey, New York, Michigan, Indiana, Virginia, Colorado, Iowa and West Virginia. RSI is also active internationally, offering its online casino and sportsbook in the regulated gaming market of Colombia on RushBet.co. RSI offers, through its proprietary online gaming platform, some of the most popular online casino games and sports betting options in the United States. Founded in 2012 in Chicago by gaming industry veterans, RSI was named the 2020 Global Gaming Awards Digital Operator of the Year and the 2020 EGR North America Awards Casino Operator of the Year and Customer Service Operator of the Year. RSI is committed to industry-leading responsible gaming practices and seeks to provide its customers with the resources and services they need to play responsibly. For more information, visit www.rushstreetinteractive.com.
For RSI Contacts:
Media:
Lisa Johnson
(609) 788-8548
lisa@lisajohnsoncommunications.com
or
Jonathan Gasthalter/Carissa Felger/Sam Fisher
(312) 319-9233 / (212) 257-4170
rsi@gasthalter.com
Investors:
ir@rushstreetinteractive.com
Cover |
Aug. 12, 2021 |
---|---|
Cover [Abstract] | |
Document Type | 8-K |
Amendment Flag | false |
Document Period End Date | Aug. 12, 2021 |
Entity File Number | 001-39232 |
Entity Registrant Name | RUSH STREET INTERACTIVE, INC. |
Entity Central Index Key | 0001793659 |
Entity Tax Identification Number | 84-3626708 |
Entity Incorporation, State or Country Code | DE |
Entity Address, Address Line One | 900 N. Michigan Avenue |
Entity Address, Address Line Two | Suite 950 |
Entity Address, City or Town | Chicago |
Entity Address, State or Province | IL |
Entity Address, Postal Zip Code | 60611 |
City Area Code | 312 |
Local Phone Number | 915-2815 |
Written Communications | false |
Soliciting Material | false |
Pre-commencement Tender Offer | false |
Pre-commencement Issuer Tender Offer | false |
Title of 12(b) Security | Class A common stock, par value $0.0001 per share |
Trading Symbol | RSI |
Security Exchange Name | NYSE |
Entity Emerging Growth Company | true |
Elected Not To Use the Extended Transition Period | false |
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