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As filed with the U.S. Securities and Exchange Commission on August 4, 2021

Registration No. 333-254840

 

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

AMENDMENT NO. 3

TO

FORM S-4

REGISTRATION STATEMENT

UNDER

THE SECURITIES ACT OF 1933

 

 

dMY Technology Group, Inc. III

(Exact Name of Registrant as Specified in its Certificate of Incorporation)

 

 

 

Delaware   6770   84-2992192

(State or Other Jurisdiction of

Incorporation or Organization)

 

(Primary Standard Industrial

Classification Code Number)

 

(IRS Employer

Identification Number)

1180 North Town Center Drive, Suite 100

Las Vegas, Nevada 89144

(702) 781-4313

(Address, including Zip Code, and Telephone Number, including Area Code, of Principal Executive Offices)

 

 

Harry L. You

Chairman

1180 North Town Center Drive, Suite 100

Las Vegas, Nevada 89144

(702) 781-4313

(Name, Address, including Zip Code, and Telephone Number, including Area Code, of Agent for Service)

 

 

Copies to:

 

Kyle A. Harris, Esq.

James E. Langston, Esq.

Adam J. Brenneman, Esq.

Cleary Gottlieb Steen & Hamilton LLP

One Liberty Plaza

New York, NY 10006

(212) 225-2000

 

Salle E. Yoo

Chief Legal Officer

IonQ, Inc.

4505 Campus Drive

College Park, MD 20740
(301) 298-7997

 

John T. McKenna, Esq.

Jaime L. Chase, Esq.

David I. Silverman, Esq.

Cooley LLP

3175 Hanover Street

Palo Alto, CA 94304

(650) 843-5000

 

 

Approximate date of commencement of proposed sale to the public: As soon as practicable after the effectiveness of this registration statement and on completion of the business combination described in the enclosed proxy statement/prospectus.

If the securities being registered on this form are being offered in connection with the formation of a holding company and there is compliance with General Instruction G, check the following box.  ☐

If this form is filed to register additional securities for an offering pursuant to Rule 462(b) 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 post-effective amendment filed pursuant to Rule 462(d) 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.  ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or 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      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.  ☐

If applicable, place an X in the box to designate the appropriate rule provision relied upon in conducting this transaction:

 

Exchange Act Rule 13e-4(i) (Cross-Border Issuer Tender Offer)   
Exchange Act Rule 14d-1(d) (Cross Border Third-Party Tender Offer)   

 

 

CALCULATION OF REGISTRATION FEE

 

 

Title of Each Class of

Securities to be Registered

 

Amount

to be

Registered(1)

 

Proposed Maximum

Offering Price

Per Public Unit

 

Proposed Maximum

Aggregate

Offering Price(2)

 

Amount of

Registration Fee(3)

Class A common stock, par value $0.0001 per share

  152,268,021   N/A   $1,212.93   $0.13(4)

 

 

(1) 

Represents the estimated maximum number of shares of Class A common stock, par value $0.0001 per share (“Class A Stock”), of the combined company following the Business Combination (as defined herein) (such company, the “Combined Company”) to be issued to Combined Company stockholders upon completion of the Business Combination, estimated solely for the purpose of calculating the registration fee, and is based on 152,268,021 shares of Class A Stock issuable as consideration to IonQ, Inc., a Delaware corporation (“IonQ”).

(2) 

Estimated solely for purposes of calculating the registration fee in accordance with Rule 457(f)(2) of the Securities Act of 1933, as amended. IonQ is a private company, no market exists for its securities, and has an accumulated deficit. Therefore, the proposed maximum aggregate offering price is one-third of the aggregate par value of the IonQ securities expected to be exchanged in the Business Combination.

(3) 

Calculated pursuant to Rule 457 of the Securities Act by calculating the product of (i) the proposed maximum aggregate offering price and (ii) 0.0001091.

(4) 

Paid in connection with the initial filing of this registration statement.

 

 

The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the Registration Statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine.

 

 

 


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The information contained in this document is subject to completion or amendment. A registration statement relating to these securities has been filed with the United States Securities and Exchange Commission. These securities may not be sold nor may offers to buy be accepted prior to the time the registration statement becomes effective. This document is not an offer to sell these securities and it is not soliciting an offer to buy these securities, nor shall there be any sale of these securities, in any jurisdiction in which such offer, solicitation or sale is not permitted or would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction.

PRELIMINARY PROXY STATEMENT/PROSPECTUS - SUBJECT TO COMPLETION, DATED

August 4, 2021

dMY Technology Group, Inc. III

1180 North Town Center Drive, Suite 100

Las Vegas, Nevada 89144

Dear dMY Technology Group, Inc. III Stockholder:

We cordially invite you to attend a special meeting (“Special Meeting”) of the stockholders of dMY Technology Group, Inc. III, a Delaware corporation (“we,” “our,” the “Company” or “dMY” and, following the closing of the Merger, the “Combined Company”), which, in light of public health concerns regarding the coronavirus (COVID-19) pandemic, will be held via live webcast on             , 2021, at              Eastern time. The Special Meeting can be accessed by visiting https://www.cstproxy.com/dmytechnologyiii/sm2021, where you will be able to listen to the meeting live and vote during the meeting. Additionally, you have the option to listen only to the Special Meeting by dialing 1-888-965-8995 (toll-free within the U.S. and Canada) or +1 415-655-0243 (outside of the U.S. and Canada, standard rates apply). The passcode for telephone access is 28259093#, but please note that you cannot vote or ask questions if you choose to participate telephonically. Please note that you will only be able to access the Special Meeting by means of remote communication.

On March 7, 2021, dMY, Ion Trap Acquisition Inc., a Delaware corporation and a direct, wholly owned subsidiary of dMY (“Merger Sub”) and IonQ, Inc., a Delaware corporation (“IonQ”), entered into an Agreement and Plan of Merger (the “Merger Agreement”), which provides for, among other things, the merger of Merger Sub with and into IonQ, with IonQ continuing as the surviving corporation (the “Merger,” and, together with the other transactions contemplated by the Merger Agreement, the “Business Combination”). Concurrently with the execution and delivery of the Merger Agreement, certain investors (the “PIPE Investors”) entered into subscription agreements (the “Subscription Agreements”) pursuant to which the PIPE Investors have committed to purchase 35,000,000 shares (the “PIPE Shares”) of dMY’s Class A common stock, par value $0.0001 per share (the “Class A Stock”), at a purchase price per share of $10.00 and an aggregate purchase price of $350.0 million (the “PIPE Investment”). The purchase of the PIPE Shares is conditioned upon, among other conditions, and will be consummated concurrently with, the closing of the Business Combination.

At the effective time of the Business Combination, each share of IonQ capital stock will be cancelled and converted into the right to receive the merger consideration in accordance with the terms of the Merger Agreement and dMY will thereafter own 100% of the outstanding capital stock of IonQ as the surviving corporation of the Merger (the “Surviving Corporation”). Any shares of IonQ capital stock held in the treasury of IonQ or owned by dMY, Merger Sub or IonQ immediately prior to the effective time will be canceled without any conversion thereof and no payment or distribution shall be made with respect thereto. IonQ Stock Options and IonQ Warrants will be assumed by dMY subject to the terms and conditions set forth in the Merger Agreement.

Subject to the terms of the Merger Agreement, the aggregate merger consideration to be paid in connection with the Business Combination is expected to be approximately 123,808,665 newly issued shares of Class A Stock equal to $1.238 billion (based on assumed value of $10.00 per share), subject to adjustments as further described in this proxy statement/prospectus.


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Following the closing of the Business Combination, the Combined Company will own all of the issued and outstanding equity interests in the Surviving Corporation, and the stockholders of IonQ as of immediately prior to the effective time will hold a portion of Class A Stock. You are being asked to vote on the Business Combination.

In connection with the closing of the Business Combination, the shares of Class B common stock of dMY, par value $0.0001 per share (the “Class B Stock” and, together with Class A Stock prior to the Business Combination, the “Common Stock”), issued prior to the dMY initial public offering (the “dMY IPO”) and held by dMY Sponsor III, LLC (the “Sponsor”) and certain other dMY stockholders (the “Founder Shares”), will automatically convert into shares of Class A Stock on a one-for-one basis and will continue to be subject to the transfer restrictions applicable to the Founder Shares. 750,000 of the Founder Shares held by the Sponsor will be placed into an escrow account and will be subject to certain vesting and forfeiture provisions as further described in this proxy statement/prospectus.

As described in this proxy statement/prospectus, our stockholders are being asked to consider and vote upon the Merger Agreement and the other proposals set forth herein. Each of the proposals is more fully described in the accompanying proxy statement/prospectus, which we encourage you to read carefully and in its entirety before voting. Only holders of record of Class A Stock at 5:00 p.m. (New York City time) on             , 2021 are entitled to notice of the Special Meeting and to vote and have their votes counted at the Special Meeting and any adjournments or postponements thereof.

Class A Stock public units (each, a “Public Unit”), which include one share of Class A Stock and one-fourth of one public warrant (“Public Warrant”), whereby each whole Public Warrant entitles the holder thereof to purchase one share of Class A Stock at an exercise price of $11.50 per share of Class A Stock, and Public Warrants are currently listed on the NYSE under the symbols “DMYI,” “DMYI-UN” and “DMYI-WT,” respectively. We intend to apply to continue the listing of the Combined Company’s common stock and Public Warrants on the NYSE under the symbols “IONQ” and “IONQ WS,” respectively, upon the consummation of the Business Combination.

Pursuant to our Amended and Restated Certificate of Incorporation (the “Current Charter”), we are providing holders of Class A Stock (“public stockholders”) with the opportunity to redeem, upon the consummation of the Business Combination, shares of Class A Stock then held by them for cash equal to their pro rata share of the aggregate amount on deposit (as of two business days prior to the consummation of the Business Combination) in the trust account that holds the proceeds of the dMY IPO (including interest not previously released to dMY to pay its taxes) (the “Trust Account”). For illustrative purposes, based on the $300,077,389 balance of the Trust Account as of March 31, 2021, the estimated redemption price would have been approximately $10.00 per share. If the Business Combination is not completed, these shares will not be redeemed. Public stockholders may elect to redeem their shares even if they vote for the Business Combination. A public stockholder, together with any of his, her or its affiliates or any other person with whom it is acting in concert or as a “group” (as defined under Section 13 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)), will be restricted from redeeming in the aggregate his, her or its shares or, if part of such a group, the group’s shares, in excess of 20% of the shares of Class A Stock included in the Public Units sold in the dMY IPO. We refer to this as the “20% threshold.” We have no specified maximum redemption threshold under the Current Charter, other than the aforementioned 20% threshold. Each redemption of shares of Class A Stock by our public stockholders will reduce the amount in the Trust Account. In no event will we redeem shares of Class A Stock in an amount that would result in dMY’s failure to have net tangible assets equaling or exceeding $5,000,001. Holders of our outstanding Public Warrants do not have redemption rights in connection with the Business Combination. Unless otherwise specified, the information in the accompanying proxy statement/prospectus assumes that none of our public stockholders exercise their redemption rights with respect to their shares of Class A Stock. The Sponsor, our current executive officers and current independent directors (collectively, our “Initial Stockholders”), as well as our officers and other current directors, have agreed to waive their redemption rights with respect to their shares of common stock in connection with the consummation of the Business Combination, and the Founder Shares will be excluded from the pro rata calculation used to determine the per-share redemption price. Our Initial Stockholders have also agreed to waive their right to a conversion price adjustment with respect to any shares of our common stock they may hold in connection with the consummation of the Business Combination.


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Currently, our Initial Stockholders own 20% of our issued and outstanding shares of common stock, including all of the Founder Shares. Our Initial Stockholders have agreed to vote any shares of common stock owned by them in favor of the Business Combination. The Founder Shares are subject to transfer restrictions.

We are providing the accompanying proxy statement/prospectus and accompanying proxy card to our stockholders in connection with the solicitation of proxies to be voted at the Special Meeting (including following any adjournments or postponements of the Special Meeting). Information about the Special Meeting, the Business Combination and other related business to be considered by our stockholders at the Special Meeting is included in this proxy statement/prospectus. Whether or not you plan to attend the Special Meeting via the virtual meeting platform, we urge all our stockholders to read this proxy statement/prospectus, including the Annexes and the accompanying financial statements of dMY and IonQ, carefully and in their entirety. In particular, we urge you to read carefully the section titled “Risk Factors” beginning on page 42 of this proxy statement/prospectus.

After careful consideration, our board of directors (the “Board”) has unanimously approved the Merger Agreement and the transactions contemplated therein, and unanimously recommends that our stockholders vote “FOR” the approval of the Merger Agreement and approval of the transactions contemplated thereby, including the Business Combination, and “FOR” all other proposals presented to our stockholders in the accompanying proxy statement/prospectus. When you consider our Board’s recommendation of these proposals, you should keep in mind that our directors and officers have interests in the Business Combination that may conflict with your interests as a stockholder. Please see the section titled “The Business Combination—Interests of Certain Persons in the Business Combination” for additional information.

Your vote is very important. Whether or not you plan to attend the Special Meeting, please vote as soon as possible by following the instructions in this proxy statement/prospectus to make sure that your shares are represented at the Special Meeting. If you hold your shares in “street name” through a bank, broker or other nominee, you will need to follow the instructions provided to you by your bank, broker or other nominee to ensure that your shares are represented and voted at the Special Meeting. The transactions contemplated by the Merger Agreement will be consummated only if the Transaction Proposal, the NYSE Proposal, the Charter Proposal, the Governance Proposals, the Equity Incentive Plan Proposal and the Employee Stock Purchase Plan Proposal are approved at the Special Meeting. Unless waived by the parties to the Merger Agreement, the consummation of the Business Combination is conditioned upon the approval of the Transaction Proposal, the NYSE Proposal, the Charter Proposal, the Equity Incentive Plan Proposal, the Employee Stock Purchase Plan Proposal and the Adjournment Proposal (the “Required Proposals”). If we fail to obtain the requisite stockholder approval for any of the Required Proposals, we will not satisfy the conditions to closing of the Merger Agreement and we may be prevented from closing the Business Combination.

If you sign, date and return your proxy card without indicating how you wish to vote, your proxy will be voted “FOR” each of the proposals presented at the Special Meeting. If you fail to return your proxy card or fail to instruct your bank, broker or other nominee how to vote, and do not attend the Special Meeting in person via the virtual meeting platform, the effect will be that your shares will not be counted for purposes of determining whether a quorum is present at the Special Meeting. If you are a stockholder of record and you attend the Special Meeting and wish to vote in person via the virtual meeting platform, you may withdraw your proxy and vote in person via the virtual meeting platform.

TO EXERCISE YOUR REDEMPTION RIGHTS, YOU MUST DEMAND THAT WE REDEEM YOUR SHARES FOR A PRO RATA PORTION OF THE FUNDS HELD IN THE TRUST ACCOUNT AND TENDER YOUR SHARES TO OUR TRANSFER AGENT AT LEAST TWO BUSINESS DAYS PRIOR TO THE VOTE AT SUCH MEETING. YOU MAY TENDER YOUR SHARES BY EITHER DELIVERING YOUR SHARE CERTIFICATE TO THE TRANSFER AGENT OR BY DELIVERING YOUR SHARES ELECTRONICALLY USING THE DEPOSITORY TRUST COMPANY’S DWAC (DEPOSIT WITHDRAWAL AT CUSTODIAN) SYSTEM. IF THE BUSINESS COMBINATION IS NOT COMPLETED, THEN THESE SHARES WILL NOT BE REDEEMED FOR CASH. IF YOU HOLD THE SHARES IN STREET NAME, YOU WILL NEED TO


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INSTRUCT THE ACCOUNT EXECUTIVE AT YOUR BANK OR BROKER TO WITHDRAW THE SHARES FROM YOUR ACCOUNT IN ORDER TO EXERCISE YOUR REDEMPTION RIGHTS.

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

 

Sincerely,

 

Harry L. You
Chairman of the Board of Directors

NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES REGULATORY AGENCY HAS APPROVED OR DISAPPROVED THE TRANSACTIONS DESCRIBED IN THIS PROXY STATEMENT/PROSPECTUS, PASSED UPON THE MERITS OR FAIRNESS OF THE BUSINESS COMBINATION OR RELATED TRANSACTIONS OR PASSED UPON THE ADEQUACY OR ACCURACY OF THE DISCLOSURE IN THIS PROXY STATEMENT/PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY CONSTITUTES A CRIMINAL OFFENSE.

This proxy statement/prospectus is dated             , 2021, and is expected to be first mailed or otherwise delivered to dMY stockholders on or about             2021.

ADDITIONAL INFORMATION

No person is authorized to give any information or to make any representation with respect to the matters that this proxy statement/prospectus describes other than those contained in this proxy statement/prospectus, and, if given or made, the information or representation must not be relied upon as having been authorized by dMY or IonQ. This proxy statement/prospectus does not constitute an offer to sell or a solicitation of an offer to buy securities or a solicitation of a proxy in any jurisdiction where, or to any person to whom, it is unlawful to make such an offer or a solicitation. Neither the delivery of this proxy statement/prospectus nor any distribution of securities made under this proxy statement/prospectus will, under any circumstances, create an implication that there has been no change in the affairs of dMY or IonQ since the date of this proxy statement/prospectus or that any information contained herein is correct as of any time subsequent to such date.


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NOTICE OF SPECIAL MEETING OF DMY TECHNOLOGY GROUP, INC. III

TO BE HELD             , 2021

To the Stockholders of dMY Technology Group, Inc. III:

NOTICE IS HEREBY GIVEN that a special meeting of the stockholders (the “Special Meeting”) of dMY Technology Group, Inc. III, a Delaware corporation (which is referred to as “we,” “us,” “our” or “dMY” and, following the consummation of the Merger, the “Combined Company”) will be held via live webcast on             , 2021, at         Eastern time. The Special Meeting can be accessed by visiting https://www.cstproxy.com/dmytechnologyiii/sm2021, where you will be able to listen to the meeting live and vote during the meeting. Additionally, you have the option to listen only to the Special Meeting by dialing by dialing 1-888-965-8995 (toll-free within the U.S. and Canada) or +1 415-655-0243 (outside of the U.S. and Canada, standard rates apply). The passcode for telephone access is 28259093#, but please note that you cannot vote or ask questions if you choose to participate telephonically. Please note that you will only be able to access the Special Meeting by means of remote communication. You are cordially invited to attend the Special Meeting to conduct the following items of business:

 

  1.

Transaction Proposal—To consider and vote upon a proposal to approve the Agreement and Plan of Merger, dated as of March 7, 2021 (the “Merger Agreement”), by and among dMY, Ion Trap Acquisition Inc., a Delaware corporation and a direct, wholly owned subsidiary of dMY (“Merger Sub”), and IonQ, Inc., a Delaware corporation (“IonQ”), a copy of which is attached to this proxy statement/prospectus as Annex A, and approve the transactions contemplated thereby, including, among other things, the merger of Merger Sub with and into IonQ, with IonQ continuing as the Surviving Corporation (together with the Merger and the other transactions contemplated by the Merger Agreement, the “Business Combination”) (Proposal No. 1, referred to as the “Transaction Proposal”);

 

  2.

NYSE Proposal—To consider and vote upon a proposal to adopt and approve, for purposes of complying with applicable listing rules of the New York Stock Exchange (the “NYSE”): the issuance of shares of common stock, par value $0.0001 per share, of the Combined Company and securities convertible into or exchangeable for the Combined Company common stock in connection with the Business Combination, including the issuance of shares of common stock in connection with the PIPE Investment (as defined below) (Proposal No. 2, referred to as the “NYSE Proposal”);

 

  3.

Charter Proposal—To consider and vote upon a proposal to adopt the proposed Second Amended and Restated Certificate of Incorporation in the form attached hereto as Annex B (Proposal No. 3, referred to as the “Charter Proposal”).

 

  4.

Governance Proposals—To consider and vote upon, on a non-binding advisory basis, certain governance provisions in the Proposed Charter, presented separately in accordance with the United States Securities and Exchange Commission (“SEC”) requirements (Proposals No. 4-A through 4-C, referred to as the “Governance Proposals”):

 

  A.

To increase the total number of shares of all classes of authorized capital stock from (i) 401,000,000, consisting of (a) 400,000,000 shares of common stock, including (1) 380,000,000 shares of Class A common stock, par value $0.0001 per share and (2) 20,000,000 shares of Class B common stock, par value $0.0001 per share, and (b) 1,000,000 shares of preferred stock, par value $0.0001 per share, to (ii) 1,020,000,000, consisting of (A) 1,000,000,000 shares of common stock, par value $0.0001 per share, and (B) 20,000,000 shares of preferred stock, par value $0.0001 per share.

 

  B.

To provide that any amendment to the amended and restated bylaws will require the approval of either the Combined Company’s board of directors or the holders of at least 6623% of the voting power of the Combined Company’s then-outstanding shares of capital stock entitled to vote generally in an election of directors, voting together as a single class.

 

  C.

To provide that any amendment to certain provisions of the Proposed Charter will require the approval of the holders of at least 6623% of the voting power of the Combined Company’s


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  then-outstanding shares of capital stock entitled to vote generally in an election of directors, voting together as a single class.

 

  5.

Equity Incentive Plan Proposal—To consider and vote upon a proposal to approve the 2021 Equity Incentive Plan, including the authorization of the initial share reserve under such plan (Proposal No. 5, referred to as the “Equity Incentive Plan Proposal”);

 

  6.

Employee Stock Purchase Plan Proposal—To consider and vote upon a proposal to approve the Employee Stock Purchase Plan, including the authorization of the initial share reserve under such plan (Proposal No. 6, referred to as the “Employee Stock Purchase Plan Proposal”);

 

  7.

Adjournment Proposal—To consider and vote upon a proposal to allow the chairman of the Special Meeting to adjourn the Special Meeting to a later date or dates, if necessary, to permit further solicitation and vote of proxies in the event that there are insufficient votes for, or otherwise in connection with, the approval of the Transaction Proposal, the NYSE Proposal, the Charter Proposal, the Governance Proposals, the Equity Incentive Plan Proposal or the Employee Stock Purchase Plan Proposal (Proposal No. 7, referred to as the “Adjournment Proposal”).

Consummation of the Business Combination is conditioned on the approval of each of the Required Proposals. The Adjournment Proposal is not conditioned on the approval of any other proposal. If the Transaction Proposal is not approved, the other proposals (except the Adjournment Proposal) will not be presented to the stockholders for a vote. It is important for you to note that in the event that the Transaction Proposal, the NYSE Proposal and the Charter Proposal do not receive the requisite vote for approval, then the Business Combination may not be consummated. If dMY does not consummate the Business Combination and fails to complete an initial business combination by November 17, 2022, dMY will be required to dissolve and liquidate the trust account that holds the proceeds of the dMY initial public offering (including interest not previously released to dMY to pay its taxes) by returning the then remaining funds in such account to the public stockholders. The proxy statement/prospectus accompanying this notice explains the Business Combination Agreement and the transactions contemplated thereby, as well as the proposals to be considered at the Special Meeting. Please review the accompanying proxy statement/prospectus carefully.

Our Initial Stockholders have agreed to vote any shares of our Common Stock owned by them in favor of the Business Combination. The record date for the Special Meeting is , 2021. Only stockholders of record at the close of business on that date may vote at the Special Meeting or any adjournment thereof. A complete list of our stockholders of record entitled to vote at the Special Meeting will be available for ten days before the Special Meeting at our principal executive offices for inspection by stockholders during ordinary business hours for any purpose germane to the Special Meeting.

YOUR VOTE IS VERY IMPORTANT, REGARDLESS OF THE NUMBER OF SHARES OF DMY COMMON STOCK YOU OWN. Whether or not you plan to attend the Special Meeting, please complete, sign, date and mail the enclosed proxy card in the postage-paid envelope provided at your earliest convenience. You may also submit a proxy by telephone or via the Internet by following the instructions printed on your proxy card. If you hold your shares through a broker, bank or other nominee, you should direct the vote of your shares in accordance with the voting instruction form received from your broker, bank or other nominee.

After careful consideration, our Board has unanimously approved the Merger Agreement and the transactions contemplated thereby and recommends that you vote “FOR” the Transaction Proposal, “FOR” the NYSE Proposal, “FOR” the Charter Proposal, “FOR” the Governance Proposals, “FOR” the Equity Incentive Plan Proposal, “FOR” the Employee Stock Purchase Plan Proposal, and “FOR” the Adjournment Proposal (if necessary).

If you have any questions or need assistance voting your shares, please call our proxy solicitor Morrow Sodali at (866) 662-5200 or email at DMYI.info@investor.morrowsodali.com.


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If you plan to attend the Special Meeting and are a beneficial investor who owns their investments through a bank or broker, you will need to contact Continental Stock Transfer & Trust Company to receive a control number. Please read carefully the sections in the proxy statement/prospectus regarding attending and voting at the Special Meeting to ensure that you comply with these requirements.

 

By Order of the Board of Directors
Harry L. You
Chairman of the Board of Directors
Las Vegas, Nevada
                , 2021


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TABLE OF CONTENTS

 

ABOUT THIS PROXY STATEMENT/PROSPECTUS

     ii  

FREQUENTLY USED TERMS

     iii  

TRADEMARKS, TRADE NAMES AND SERVICE MARKS

     viii  

QUESTIONS AND ANSWERS

     1  

SUMMARY

     18  

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

     40  

RISK FACTORS

     42  

SPECIAL MEETING OF THE STOCKHOLDERS OF DMY

     89  

THE BUSINESS COMBINATION

     98  

MATERIAL TAX CONSIDERATIONS

     115  

THE MERGER AGREEMENT AND RELATED AGREEMENTS

     121  

REGULATORY APPROVALS RELATED TO THE BUSINESS COMBINATION

     138  

UNAUDITED PRO FORMA COMBINED FINANCIAL INFORMATION

     139  

COMPARATIVE SHARE INFORMATION

     151  

CAPITALIZATION

     153  

COMPARATIVE HISTORICAL PER SHARE DATA

     154  

INFORMATION ABOUT DMY

     155  

MANAGEMENT OF DMY

     159  

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

     168  

INFORMATION ABOUT IONQ

     176  

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

     192  

IONQ EXECUTIVE COMPENSATION

     207  

MANAGEMENT OF THE COMBINED COMPANY

     214  

DESCRIPTION OF COMBINED COMPANY SECURITIES

     221  

SHARES ELIGIBLE FOR FUTURE SALE

     235  

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

     237  

BENEFICIAL OWNERSHIP OF SECURITIES

     242  

PROPOSAL NO. 1—THE TRANSACTION PROPOSAL

     245  

PROPOSAL NO. 2—THE NYSE PROPOSAL

     246  

PROPOSAL NO. 3—THE CHARTER PROPOSAL

     247  

PROPOSAL NO. 4—THE GOVERNANCE PROPOSALS

     250  

PROPOSAL NO. 5—THE EQUITY INCENTIVE PLAN PROPOSAL

     252  

PROPOSAL NO. 6—THE EMPLOYEE STOCK PURCHASE PLAN PROPOSAL

     261  

PROPOSAL NO. 7—THE ADJOURNMENT PROPOSAL

     266  

ADDITIONAL INFORMATION

     267  

WHERE YOU CAN FIND MORE INFORMATION

     269  

INDEX TO CONSOLIDATED FINANCIAL INFORMATION

     F-1  

ANNEX A. MERGER AGREEMENT

     A-1  

ANNEX B. PROPOSED CHARTER

     B-1  

ANNEX C. AMENDED AND RESTATED BYLAWS

     C-1  

ANNEX D. FORM OF 2021 EQUITY INCENTIVE PLAN

     D-1  

ANNEX E. FORM OF EMPLOYEE STOCK PURCHASE PLAN

     E-1  

 

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ABOUT THIS PROXY STATEMENT/PROSPECTUS

This document, which forms part of a registration statement on Form S-4 filed with the U.S. Securities and Exchange Commission by us (File No. 333-254840), constitutes a prospectus under Section 5 of the Securities Act, with respect to the shares of Class A Stock to be issued if the Business Combination described below is consummated. This document also constitutes a notice of meeting and a proxy statement under Section 14(a) of the U.S. Securities Exchange Act of 1934, as amended, with respect to the Special Meeting of our stockholders at which our stockholders will be asked to consider and vote upon a proposal to approve the Business Combination by the approval and adoption of the Merger Agreement, among other matters.

 

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FREQUENTLY USED TERMS

In this proxy statement/prospectus:

2021 Plan” means the 2021 Equity Incentive Plan, a copy of which is attached hereto as Annex D.

Aggregate Stock Consideration” means an estimated approximately 123,808,665 shares of Class A Stock (deemed to have a value of $10.00 per share), with the final number of such shares of common stock to equal (a) the IonQ Equity Value, divided by (b) $10.00.

Antitrust Division” means the Antitrust Division of the U.S. Department of Justice.

Assumed Warrants” means the resulting warrants from the conversion at the effective time of the Merger of each IonQ Warrant issued and outstanding immediately prior to the effective time of the Merger into a conditional right to purchase Class A Stock at an adjusted exercise price per share, subject to the terms and conditions as were applicable to such IonQ Warrant immediately prior to the effective time of the Merger, including applicable vesting conditions.

Board” means the board of directors of dMY.

Business Combination” means the transactions contemplated by the Merger Agreement, including, among other things, the Merger.

Class A Stock” means the shares of Class A Stock, par value $0.0001 per share, of dMY.

Class B Stock” means the shares of Class B Stock, par value $0.0001 per share, of dMY.

Common Stock” means the Class A Stock of dMY and, prior to the Business Combination, both the Class A Stock and Class B Stock.

Combined Company” means the company following the Business Combination.

Continental Warrant Agreement” means that certain Warrant Agreement, by and between dMY and Continental Stock Transfer & Trust Company, as warrant agent, dated as of November 12, 2020.

Court of Chancery” means the Court of Chancery of the State of Delaware.

Current Charter” means the Amended and Restated Certificate of Incorporation of dMY, dated November 20, 2020.

Deferred Discount” means deferred underwriting commissions of $10.5 million in the aggregate, which will be payable upon consummation of an initial business combination.

DGCL” means the Delaware General Corporation Law.

dMY” means dMY Technology Group, Inc. III prior to the Business Combination.

dMY Executives” means Niccolo de Masi and Harry You.

dMY IPO” means dMY’s initial public offering, consummated on November 17, 2020, through the sale of 30,000,000 Public Units (including 2,500,000 Public Units sold pursuant to the underwriters’ partial exercise of their over-allotment option) at $10.00 per Public Unit.

 

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ESPP” means the 2021 Employee Stock Purchase Plan, a copy of which is attached hereto as Annex E.

Exchange Act” means the Securities Exchange Act of 1934, as amended, together with the rules and regulations promulgated thereunder.

FINRA” means the Financial Industry Regulatory Authority.

Founder Shares” means the 7,500,000 shares of Class B Stock that are currently owned by the Initial Stockholders.

FTC” means the U.S. Federal Trade Commission.

GAAP” means generally accepted accounting principles in the United States.

HSR Act” means the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended.

initial business combination” means a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination involving dMY and one or more businesses.

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

Insider” means each dMY stockholder, other than the Sponsor, which is a party to the Sponsor Support Agreement.

Investment Company Act” means the Investment Company Act of 1940, as amended.

IonQ” means IonQ, Inc., a Delaware corporation.

IonQ common stock” means the shares of the Common Stock, par value $0.0001 per share, of IonQ.

IonQ Equity Value” means an amount equal to $1.275 billion plus the Net Equity Value Adjustment Amount (which, for the avoidance of doubt, may be a positive or a negative number).

IonQ Equityholders” means the stockholders of IonQ and the holders of other equity interests in IonQ (including IonQ Stock Options and IonQ Warrants).

IonQ preferred stock” means the (a) IonQ Series A preferred stock, (b) IonQ Series B preferred stock, and (c) IonQ Series B-1 preferred stock.

IonQ Series A preferred stock” means the shares of the Series A Preferred Stock, par value $0.0001 per share, of IonQ.

IonQ Series B preferred stock” means the shares of the Series B Preferred Stock, par value $0.0001 per share, of IonQ.

IonQ Series B-1 preferred stock” means the shares of the Series B-1 Preferred Stock, par value $0.0001 per share, IonQ.

IonQ capital stock” means the IonQ common stock and the IonQ preferred stock.

IonQ Stock Adjusted Fully Diluted Shares” means the sum of (a) aggregate number of shares of capital stock of IonQ outstanding as of immediately prior to the effective time of the Merger and (b) the aggregate number of shares of IonQ common stock issuable upon exercise of all vested IonQ Stock Options and vested IonQ Warrants outstanding as of immediately prior to the effective time of the Merger.

 

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IonQ Stock Option” means each option to purchase IonQ common stock issued and outstanding under IonQ’s 2015 Equity Incentive Plan.

IonQ Stockholder Support Agreement” means the Stockholder Support Agreement, dated as of March 7, 2021, by and among dMY, IonQ and the IonQ stockholders party thereto.

IonQ Warrants” means the warrants exercisable for IonQ preferred stock that are outstanding as of immediately prior to the consummation of the Business Combination.

IRS” means the U.S. Internal Revenue Service.

JOBS Act” means the Jumpstart Our Business Startups Act of 2012.

Merger” means the merger of Merger Sub with and into IonQ, with IonQ continuing as the Surviving Corporation.

Merger Agreement” means that certain Agreement and Plan of Merger, dated as of March 7, 2021, by and among dMY, Merger Sub and IonQ, which is attached hereto as Annex A.

Merger Sub” means Ion Trap Acquisition Inc., a Delaware corporation and a direct, wholly owned subsidiary of dMY.

Net Equity Value Adjustment Amount” means the positive or negative amount, as the case may be, equal to (a) the lesser of (i) the cash and cash equivalents of IonQ expected to be held by IonQ as of 11:59 p.m. (Eastern time) on the Business Day immediately preceding the effective time and (ii) $50.0 million, minus (b) the outstanding indebtedness of IonQ as of 11:59 p.m. (Eastern time) on the Business Day immediately preceding the effective time, plus (c) the amount, if any, that the sum of all of the transaction expenses incurred by any of the Sponsor or dMY or expressly allocated to any of the Sponsor or dMY as set forth in the Merger Agreement, and only to the extent the Sponsor or dMY is obligated to pay or has agreed to pay such transaction expense pursuant to the Merger Agreement, exceed $50.0 million, minus (d) the amount, if any, that the sum of all of the transaction expenses incurred by any IonQ or expressly allocated to IonQ as set forth in the Merger Agreement, and only to the extent IonQ is obligated to pay or has agreed to pay such transaction expense pursuant to the Merger Agreement, exceed $20.0 million.

Note” means the promissory note issued to the Sponsor as consideration for a loan in an aggregate of up to $200,000 to cover expenses related to the dMY IPO.

NYSE” means the New York Stock Exchange.

Per Share IonQ Stock Consideration” means the Aggregate Stock Consideration divided by the IonQ Stock Adjusted Fully Diluted Shares.

PIPE Investment” means the sale by dMY to the PIPE Investors an aggregate number of Class A Stock shares in exchange for an aggregate purchase price of $350.0 million.

PIPE Investors” means persons that have entered into subscription agreements to purchase for cash Class A Stock shares pursuant to the PIPE Investment on or prior to the date of the Merger Agreement.

preferred stock” means the preferred stock, par value of $0.0001 per share, of dMY, and following the Business Combination, of the Combined Company.

Private Placement” means the private placement of the Private Warrants.

 

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Private Warrants” means the warrants held by the Sponsor that were issued to the Sponsor at the closing of the dMY IPO, each of which is exercisable, at an exercise price of $11.50, for one share of Class A Stock, in accordance with its terms.

Proposed Charter” means the proposed Second Amended and Restated Certificate of Incorporation of the Combined Company, a form of which is attached hereto as Annex B, which will become the Combined Company’s certificate of incorporation upon the approval of the Charter Proposal, assuming the consummation of the Business Combination.

Public Shares” means the shares of Class A Stock included in the Public Units issued in the dMY IPO.

public stockholders” means holders of Public Shares, including the Initial Stockholders to the extent the Initial Stockholders hold Public Shares; provided, that the Initial Stockholders are considered a “public stockholder” only with respect to any Public Shares held by them.

Public Unit” means one share of Class A Stock and one-fourth of one Public Warrant, whereby each whole Public Warrant entitles the holder thereof to purchase one share of Class A Stock at an exercise price of $11.50 per share of Class A Stock, sold in the dMY IPO.

Public Warrants” means the warrants included in the Public Units issued in the dMY IPO, each of which is exercisable, at an exercise price of $11.50, for one share of Class A Stock, in accordance with its terms.

Registration Rights Agreement” means that certain Amended and Restated Registration Rights Agreement, to be entered into between and among dMY, the Initial Stockholders and certain IonQ stockholders.

Registration Rights Holders” means the Sponsor, dMY’s independent directors and certain IonQ Equityholders.

Related Agreements” means, collectively, the Registration Rights Agreement, the Sponsor Support Agreement, the IonQ Stockholder Support Agreement, the Lock-Up Agreement, the Proposed Charter and the amended and restated bylaws.

Rollover Options” means the options to acquire Class A Stock resulting from the assumption by dMY and conversion at the effective time of the Merger of each IonQ Stock Option that is issued and outstanding immediately prior to the effective time of the Merger into an option to acquire Class A Stock at an adjusted exercise price per share, subject to the terms and conditions as were applicable to the corresponding IonQ Stock Option immediately prior to the effective time of the Merger, including applicable vesting conditions and exercisability terms.

Rule 144” means Rule 144 under the Securities Act.

Sarbanes-Oxley Act” means the Sarbanes-Oxley Act of 2002.

SEC” means the United States Securities and Exchange Commission.

Second Request” means a request for additional information or documentary material issued by the Antitrust Division or the FTC, which will extend the initial waiting period under the HSR Act until 30 days after each of the parties has substantially complied with the Second Request.

Securities Act” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.

Special Meeting” means the special meeting that is the subject of this proxy statement/prospectus.

 

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Sponsor” means dMY Sponsor III, LLC, an affiliate of Mr. Harry L. You, dMY’s Chairman, and the other directors and officers of dMY.

Sponsor Support Agreement” means the letter agreement, dated as of March 7, 2021, by and among dMY, the Insiders, the Sponsor and IonQ.

Subscription Agreement” means a contract executed by a PIPE Investor on or before the date of the Merger Agreement in connection with the PIPE Investment.

Subsequent Transaction” shall mean the occurrence of any of the following events: (i) any Person or any group of Persons acting together which would constitute a “group” for purposes of Section 13(d) of the Exchange Act or any successor provisions thereto is or becomes the beneficial owner, directly or indirectly, of securities of the Combined Company representing more than 50% of the combined voting power of the Combined Company’s then-outstanding voting securities, (ii) there is consummated a merger or consolidation of the Combined Company with any other corporation or other entity, and, immediately after the consummation of such merger or consolidation, the voting securities of the Combined Company immediately prior to such merger or consolidation do not continue to represent or are not converted into more than 50% of the combined voting power of the then outstanding voting securities of the Person resulting from such merger or consolidation or, if the surviving company is a Subsidiary, the ultimate parent thereof, or (iii) the stockholders of the Combined Company approve a plan of complete liquidation or dissolution of the Combined Company or there is consummated an agreement or series of related agreements for the sale, lease or other disposition, directly or indirectly, by the Combined Company of all or substantially all of the assets of the Combined Company and its subsidiaries, taken as a whole, other than such sale or other disposition by the Combined Company of all or substantially all of the assets of the Combined Company and its subsidiaries, taken as a whole, to an entity at least 50% of the combined voting power of the voting securities of which are owned by shareholders of the Combined Company in substantially the same proportions as their ownership of the Combined Company immediately prior to such sale.

Surviving Corporation” means IonQ following the consummation of the Merger.

Trading Day” means any day on which shares of Class A Stock are actually traded on the Trading Market.

Trading Market” means the New York Stock Exchange or any other stock market on which shares of Class A Stock shall be trading at the time of determination of the closing price of such shares.

Trust Account” means the trust account of dMY that holds the proceeds from the dMY IPO.

Trustee” or “Transfer Agent,” as applicable, means Continental Stock Transfer & Trust Company.

U.S. Tax Code” means the U.S. Internal Revenue Code of 1986, as amended.

Vesting Shares” means the shares of Class B Stock (and following the consummation of the Business Combination, the shares of Class A Stock) that are subject to restrictions under the Sponsor Support Agreement.

Warrants” means, collectively, the Private Warrants and the Public Warrants.

Whole Board” means the total number of authorized directors, whether or not there exist any vacancies or unfilled seats in previously authorized directorships.

 

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TRADEMARKS, TRADE NAMES AND SERVICE MARKS

dMY, IonQ and IonQ’s subsidiaries own or have rights to trademarks, trade names and service marks that they use in connection with the operation of their business. In addition, their names, logos and website names and addresses are their trademarks or service marks. Other trademarks, trade names and service marks appearing in this proxy statement/prospectus are the property of their respective owners. Solely for convenience, in some cases, the trademarks, trade names and service marks referred to in this proxy statement/prospectus are listed without the applicable ®, ™ and SM symbols, but they will assert, to the fullest extent under applicable law, their rights to these trademarks, trade names and service marks.

 

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QUESTIONS AND ANSWERS

The questions and answers below highlight only selected information from this proxy statement/prospectus and only briefly address some commonly asked questions about the Special Meeting and the proposals to be presented at the Special Meeting, including with respect to the proposed Business Combination. The following questions and answers do not include all the information that is important to our stockholders. Stockholders are urged to read carefully this entire proxy statement/prospectus, including the Annexes and the other documents referred to herein, to fully understand the proposed Business Combination and the voting procedures for the Special Meeting, which, in light of public health concerns regarding the coronavirus (COVID-19) pandemic, will be held via live webcast on             , 2021, at          Eastern time. The Special Meeting can be accessed by visiting https://www.cstproxy.com/dmytechnologyiii/sm2021, where you will be able to listen to the meeting live and vote during the meeting. Additionally, you have the option to listen only to the Special Meeting by dialing 1-888-965-8995 (toll-free within the U.S. and Canada) or +1 415-655-0243 (outside of the U.S. and Canada, standard rates apply). The passcode for telephone access is 28259093#, but please note that you cannot vote or ask questions if you choose to participate telephonically. Please note that you will only be able to access the Special Meeting by means of remote communication.

QUESTIONS AND ANSWERS ABOUT DMY’S SPECIAL STOCKHOLDER MEETING AND THE BUSINESS COMBINATION

 

Q:

Why am I receiving this proxy statement/prospectus?

 

A:

Our stockholders are being asked to consider and vote upon a proposal to approve the Merger Agreement and the transactions contemplated thereby, including the Business Combination, among other proposals. We have entered into the Merger Agreement, providing for, among other things, the merger of Merger Sub with and into IonQ, with IonQ continuing as the Surviving Corporation, and after giving effect to the Merger, becoming a wholly owned subsidiary of the Combined Company. You are being asked to vote on the Business Combination. A copy of the Merger Agreement is attached to this proxy statement/prospectus as Annex A.

This proxy statement/prospectus and its Annexes contain important information about the proposed Business Combination and the other matters to be acted upon at the Special Meeting. You should read this proxy statement/prospectus and its Annexes carefully and in their entirety.

Your vote is important. You are encouraged to submit your proxy as soon as possible after carefully reviewing this proxy statement/prospectus and its Annexes.

 

Q:

When and where is the Special Meeting?

 

A:

In light of public health concerns regarding the coronavirus (COVID-19) pandemic, the Special Meeting will be held via live webcast on             , 2021, at          Eastern time. The Special Meeting can be accessed by visiting https://www.cstproxy.com/dmytechnologyiii/sm2021, where you will be able to listen to the meeting live and vote during the meeting. Additionally, you have the option to listen only to the Special Meeting by dialing 1-888-965-8995 (toll-free within the U.S. and Canada) or +1 415-655-0243 (outside of the U.S. and Canada, standard rates apply). The passcode for telephone access is 28259093#, but please note that you cannot vote or ask questions if you choose to participate telephonically. Please note that you will only be able to access the Special Meeting by means of remote communication.

 

Q:

What are the specific proposals on which I am being asked to vote at the Special Meeting?

 

A:

Our stockholders are being asked to approve the following proposals:

 

  1.

The Transaction Proposal;

 

  2.

NYSE Proposal;

 

  3.

Charter Proposal;

 

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  4.

Governance Proposals;

 

  5.

Equity Incentive Plan Proposal;

 

  6.

Employee Stock Purchase Plan Proposal; and

 

  7.

Adjournment Proposal.

If dMY stockholders fail to approve the Required Proposals, the Business Combination will not occur. The consummation of the Business Combination is not conditioned upon the approval of the Governance Proposals at the Special Meeting. The Adjournment Proposal is not conditioned on the approval of any other proposal. If the Transaction Proposal is not approved, the other proposals (except for the Adjournment Proposal) will not be presented to the stockholders for a vote.

 

Q:

Why is dMY proposing the Governance Proposals?

 

A:

As required by applicable SEC guidance, dMY is requesting that its stockholders vote upon, on a non-binding advisory basis, a proposal to approve certain governance provisions contained in the Proposed Charter that may reasonably be considered to materially affect stockholder rights and therefore require a non-binding advisory basis vote pursuant to SEC guidance. This non-binding advisory vote is not otherwise required by Delaware law and is separate and apart from the Charter Proposal, but consistent with SEC guidance, dMY is submitting these provisions to its stockholders separately for approval. However, the stockholder vote regarding this proposal is an advisory vote, and is not binding on dMY or the Board (separate and apart from the approval of the Charter Proposal). Furthermore, the Business Combination is not conditioned on the separate approval of the Governance Proposals (separate and apart from approval of the Charter Proposal). See the section titled “Proposal No. 4: The Governance Proposals” of this proxy statement/prospectus for additional information.

 

Q:

Why is dMY proposing the Business Combination?

 

A:

We are a blank check company incorporated as a Delaware corporation on September 14, 2020 and incorporated for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses (an “initial business combination”). Our acquisition plan is not limited to a particular industry or geographic region for purposes of consummating an initial business combination. However, we (a) must complete an initial business combination with one or more target businesses that together have a fair market value of at least 80% of the assets held in the Trust Account (excluding amounts disbursed to management for working capital purposes, if permitted, and the Deferred Discount) at the time of the agreement to enter into the initial business combination and (b) are not, under the Current Charter, permitted to effect an initial business combination with a blank check company or a similar company with nominal operations.

The prospectus for the dMY IPO stated that we intended to use the following general criteria and guidelines to evaluate potential acquisition opportunities:

 

   

Whether the target had an enterprise value is between $1.0 billion and $3.0 billion;

 

   

Whether the target was in the mobile app industry and consumer internet sectors, or in consumer software segments worldwide and key enablement and disruptive technologies underpinning the mobile ecosystem, such as artificial intelligence, machine learning, cloud infrastructures or quantum computing;

 

   

Whether the target had a proven and accomplished management team;

 

   

Whether the target had the requisite compliance, financial controls and reporting processes in place and was ready for the regulatory requirements of a public entity;

 

   

Whether the target had a promising growth path, driven by a sustainable competitive advantage, with opportunities for acceleration by a partnership with us;

 

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Whether the target had a management team with the interest and ability to execute on strategic opportunities, including accretive acquisitions of companies that have the potential to enhance shareholder value;

 

   

Whether the target had management and stakeholders who aspire to have their company become a public entity and generate substantial growth;

 

   

Whether the target had a sizable market share in their segment and the opportunity to achieve market leadership;

 

   

Whether the target had defensible proprietary technology and intellectual property rights; and

 

   

Whether the target had an appropriate valuation.

Based on our due diligence investigations of IonQ and the industry in which it operates, including the financial and other information provided by IonQ in the course of negotiations, we believe that IonQ meets the criteria and guidelines listed above. Please see the section titled “The Business Combination—Recommendation of dMY’s Board of Directors and Reasons for the Business Combination” for additional information.

 

Q:

Why is dMY providing stockholders with the opportunity to vote on the Business Combination?

 

A:

Under the Current Charter, we must provide all holders of Public Shares with the opportunity to have their Public Shares redeemed upon the consummation of our initial business combination either in conjunction with a tender offer or in conjunction with a stockholder vote. For business and other reasons, we have elected to provide our stockholders with the opportunity to have their Public Shares redeemed in connection with a stockholder vote rather than a tender offer. Therefore, we are seeking to obtain the approval of our stockholders of the Transaction Proposal in order to allow our public stockholders to effectuate redemptions of their Public Shares in connection with the consummation of the Business Combination. The approval of the Business Combination is required under the Current Charter. In addition, such approval is also a condition to the consummation of the Business Combination under the Merger Agreement.

 

Q:

Did the Board obtain a third-party valuation or fairness opinion in determining whether or not to proceed with the Merger?

 

A:

No. The Board did not obtain a fairness opinion with respect to the consideration to be paid in the Merger. The officers and directors of dMY and dMY’s advisors have substantial experience in evaluating the operating and financial merits of companies from a wide range of industries and concluded that their experience and backgrounds, together with the experience and sector expertise of dMY’s financial advisors, enabled them to make the necessary analyses and determinations regarding the Merger. In addition, dMY’s officers and directors and dMY’s advisors have substantial experience with mergers and acquisitions. Accordingly, investors will be relying solely on the judgment of the Board and dMY’s advisors in valuing IonQ’s business.

 

Q:

What will happen in the Business Combination?

 

A:

Pursuant to the Merger Agreement, and upon the terms and subject to the conditions set forth therein, dMY will acquire IonQ in a transaction we refer to as the Business Combination. At the closing of the Business Combination contemplated by the Merger Agreement, among other things, Merger Sub will merge with and into IonQ, with IonQ continuing as the Surviving Corporation. As a result of the Merger, at the closing of the Business Combination, the Combined Company will own 100% of the outstanding stock of IonQ, and each share of IonQ capital stock (other than any shares of IonQ capital stock held in the treasury of IonQ or owned by dMY, Merger Sub or IonQ immediately prior to the effective time, which will be canceled without any conversion thereof and no payment or distribution will be made with respect thereto) will be cancelled and converted into the right to receive the Per Share IonQ Stock Consideration, except to the extent that any such holder duly exercises and perfects dissenters’ rights with respect to such IonQ capital stock in accordance with Section 262 of the DGCL.

 

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Q:

How has the announcement of the Business Combination affected the trading price of the Public Shares?

 

A:

On March 5, 2021, the last trading date before the public announcement of the Business Combination, the Public Units, Public Shares and Public Warrants closed at $13.10, $12.70 and $3.20, respectively. On                 , 2021, the trading date immediately prior to the date of this proxy statement/prospectus, the Public Units, Public Shares and Public Warrants closed at $                , $                 and $                , respectively.

 

Q:

Following the Business Combination, will dMY’s securities continue to trade on a stock exchange?

 

A:

Yes. The Public Shares, Public Units and Public Warrants are currently listed on the NYSE under the symbols “DMYI,” “DMYI-UN” and “DMYI-WT,” respectively. We intend to apply to continue the listing of the Combined Company’s common stock and Public Warrants on the NYSE under the symbols “IONQ” and “IONQ WS,” respectively, upon the consummation of the Business Combination.

 

Q:

Is the Business Combination the first step in a “going private” transaction?

 

A:

No. We do not intend for the Business Combination to be the first step in a “going private” transaction. One of the primary purposes of the Business Combination is to provide a platform for IonQ to access the U.S. public markets.

 

Q:

Will the management of dMY change in the Business Combination?

 

A:

Following the consummation of the Business Combination, it is expected that the current senior management of IonQ will comprise the senior management of the Combined Company, and the Combined Company’s board of directors will consist of seven members, two of whom shall be Niccolo de Masi and Harry You. Mr. You will be a member of the Combined Company’s audit committee and Mr. de Masi and Mr. You will be members of different classes of directors, in each case, subject to the terms of the Combined Company’s Proposed Charter.

Please see the section titled “Management of the Combined Company” for additional information.

 

Q:

How will the Business Combination impact the outstanding shares of dMY following the consummation of the Business Combination?

 

A:

As a result of the Business Combination and the consummation of the transactions contemplated thereby, the number of shares of common stock outstanding will increase by approximately 521% to approximately 195,558,665 shares of common stock (assuming that no shares of Class A Stock are redeemed). Additional shares of common stock may be issuable in the future as a result of the issuance of additional shares that are not currently outstanding, including issuance of shares of Class A Stock upon exercise of the Public Warrants and Private Warrants following the consummation of the Business Combination. The issuance and sale of such shares in the public market could adversely impact the market price of our common stock, even if our business is doing well.

 

Q:

What will IonQ stockholders receive in the Business Combination?

 

A:

Subject to the terms of the Merger Agreement and the Net Equity Value Adjustment set forth therein, the aggregate merger consideration to be paid in connection with the Business Combination is expected to be approximately 123,808,665 shares of Class A Stock (deemed to have a value of $10.00 per share) with an implied value equal to the Aggregate Stock Consideration. Holders of shares of IonQ capital stock (other than any shares of IonQ capital stock held in the treasury of IonQ or owned by dMY, Merger Sub or IonQ immediately prior to the effective time, which will be canceled without any conversion thereof and no payment or distribution will be made with respect thereto) will be entitled to receive a number of shares of newly-issued Class A Stock equal to the Per Share IonQ Stock Consideration for each such share of IonQ capital stock, except to the extent that any such holder duly exercises and perfects dissenters’ rights with respect to such IonQ capital stock in accordance with Section 262 of the DGCL.

 

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Q.

What will holders of IonQ equity awards receive in the Business Combination?

 

A:

As of the effective time of the Merger, each outstanding unexercised IonQ Stock Option will be assumed by dMY and converted into an option to acquire a number of shares of Class A Stock determined by multiplying the number of shares of IonQ capital stock subject to such option as of immediately prior thereto by the Per Share IonQ Stock Consideration (determined in accordance with the Merger Agreement), rounded down to the nearest whole number of shares, subject to the same terms and conditions as were applicable thereto immediately prior thereto (including applicable vesting conditions and exercisability terms). Each such converted stock option will be exercisable solely for shares of Class A Stock, and the per share exercise price for the stock issuable upon exercise thereof will be determined by dividing the per share exercise price for the shares of IonQ common stock subject to the IonQ Stock Option immediately prior thereto by the Per Share IonQ Stock Consideration, rounded up to the nearest whole cent.

 

Q:

What equity stake will the current stockholders of dMY and the IonQ Equityholders hold in the Combined Company after the consummation of the Business Combination?

 

A:

The following table illustrates the fully diluted ownership levels upon consummation of the Business Combination based on the outstanding equity (including future shares issuable upon the exercise of outstanding options and warrants of dMY and IonQ) as of June 7, 2021 and assuming various redemption levels by dMY’s public stockholders.

 

    Redemption Threshold  
    0%(1)     25%(2)     50%(3)     75%(4)     100%(5)  
    (No Redemption)                                         (Maximum
Redemption)
 
    Shares     %     Shares     %     Shares     %     Shares     %     Shares     %  

dMY Public Stockholders

    30,000,000       12.4       22,500,000       9.6       15,000,000       6.6       7,500,000       3.4             —    

dMY Public Warrantholders

    7,500,000       3.1       7,500,000       3.2       7,500,000       3.3       7,500,000       3.4       7,500,000       3.5  

dMY Insiders and Sponsor stockholders(6)

    7,500,000       3.1       7,500,000       3.2       7,500,000       3.3       7,500,000       3.4       7,500,000       3.5  

dMY Insiders and Sponsor Warrantholders

    4,000,000       1.7       4,000,000       1.7       4,000,000       1.8       4,000,000       1.8       4,000,000       1.9  

PIPE Investors - Affiliates of IonQ(7)

    2,450,000       1.0       2,450,000       1.0       2,450,000       1.1       2,450,000       1.1       2,450,000       1.2  

PIPE Investors - Non-Affiliated Holders(7)

    32,550,000       13.4       32,550,000       13.9       32,550,000       14.4       32,550,000       15.0       32,550,000       15.4  

Former IonQ stockholders

    123,808,665       51.3       123,808,665       53.0       123,808,665       54.6       123,808,665       56.5       123,808,665       58.5  

Former IonQ Optionees and Warrantholders(8)

    33,760,620       14.0       33,760,620       14.4       33,760,620       14.9       33,760,620       15.4       33,760,620       16.0  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total Fully Diluted Shares Outstanding(9)

    241,569,285       100.0       234,069,285       100.0       226,569,285       100.0       219,069,285       100.0       211,569,285       100.0  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

 

  (1)

Assumes that no shares of Class A Stock are redeemed.

  (2)

Assumes redemptions of 7,500,000 Class A Stock using a per-share redemption price of $10.00 (due to investment-related gains in the Trust Account).

  (3)

Assumes redemptions of 15,000,000 Class A Stock using a per-share redemption price of $10.00 (due to investment-related gains in the Trust Account).

  (4)

Assumes redemptions of 22,500,000 Class A Stock using a per-share redemption price of $10.00 (due to investment-related gains in the Trust Account).

  (5)

Assumes maximum redemptions of 30,000,000 Class A Stock using a per-share redemption price of $10.00 (due to investment-related gains in the Trust Account).

  (6)

Share amounts assumes the full vesting of 750,000 Vesting Shares.

  (7)

Assumes the PIPE Investment is consummated in accordance with its terms for $350.0 million, with 35,000,000 shares of Class A Stock issued to the PIPE Investors.

  (8)

Includes approximately (i) 25,292,409 shares of Class A Stock issuable upon the exercise of IonQ Stock Options (vested and unvested) to acquire Class A Stock and (ii) 8,468,211 shares of Class A

 

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  Stock issuable upon the exercise of IonQ Warrants (vested and unvested). IonQ Stock Options and IonQ Warrants do not represent legally outstanding shares of common stock at closing.
  (9)

Excludes remaining shares available for issuance pursuant to any existing or successor equity incentive plan.

For more information, please see the sections titled “Summary–Impact of the Business Combination on the Combined Company’s Public Float” and “Unaudited Pro Forma Combined Financial Information.”

 

Q:

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

 

A:

Yes. Concurrently with the execution of the Merger Agreement, we entered into Subscription Agreements with the PIPE Investors pursuant to which, among other things, the PIPE Investors agreed to subscribe for and purchase, and we agreed to issue and sell to the PIPE Investors, an aggregate amount of 35,000,000 shares of Class A Stock as set forth in the Subscription Agreements in exchange for a purchase price per share of $10.00 and an aggregate purchase price of $350.0 million at the consummation of the Business Combination. The main difference between the securities issued at the time of the IPO as compared to the PIPE Investment is the issuance of Class A Stock rather than Public Units. Neither of the Sponsor, our directors, officers or their respective affiliates will participate in the PIPE Investment. For additional information, see “The Merger Agreement and Related Agreements–Related Agreements Subscription Agreements.”

 

Q:

What happens if I sell my shares of Class A Stock before the Special Meeting?

 

A:

The record date for the Special Meeting is earlier than the date that the Business Combination is expected to be completed. If you transfer your shares of Class A Stock after the record date, but before the Special Meeting, unless the transferee obtains from you a proxy to vote those shares, you will retain your right to vote at the Special Meeting. However, you will not be able to seek redemption of your shares of Class A Stock because you will no longer be able to deliver them for cancellation upon consummation of the Business Combination. If you transfer your shares of Class A Stock prior to the record date, you will have no right to vote those shares at the Special Meeting or redeem those shares for a pro rata portion of the proceeds held in our Trust Account.

 

Q:

What vote is required to approve the proposals presented at the Special Meeting?

 

A:

The approval of the Transaction Proposal requires the affirmative vote of at least a majority of the votes cast by holders of outstanding shares of our common stock represented in person via the virtual meeting platform or by proxy and entitled to vote thereon at the Special Meeting. Failure to vote by proxy or to vote in person via the virtual meeting platform at the Special Meeting and broker non-votes will have no effect on the Transaction Proposal. Abstentions will be counted in connection with the determination of whether a valid quorum is established but will have no effect on the Transaction Proposal. Our Initial Stockholders have agreed to vote their shares of common stock in favor of the Transaction Proposal.

The approval of the NYSE Proposal requires the affirmative vote of holders of at least a majority of the votes cast by holders of outstanding shares of our common stock represented in person via the virtual meeting platform or by proxy and entitled to vote thereon at the Special Meeting. Failure to vote by proxy or to vote in person via the virtual meeting platform at the Special Meeting and broker non-votes will have no effect on the NYSE Proposal. Abstentions will be counted in connection with the determination of whether a valid quorum is established but will have no effect on the NYSE Proposal.

The approval of the Charter Proposal requires (i) the affirmative vote of holders of a majority of our outstanding shares of common stock entitled to vote thereon at the Special Meeting and (ii) the affirmative vote of holders of a majority of our outstanding shares of Class B Stock, voting separately as a single class, entitled to vote thereon at the Special Meeting. Accordingly, a stockholder’s failure to vote by proxy or to vote in person via the virtual meeting platform at the Special Meeting, as well as an abstention from voting and a broker non-vote with regard to the Charter Proposal will have the same effect as a vote “AGAINST” such Charter Proposal.

 

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The approval of the Governance Proposals require the affirmative vote of at least a majority of the votes cast by holders of our outstanding shares of common stock represented in person via the virtual meeting platform or by proxy and entitled to vote thereon at the Special Meeting. Accordingly, a dMY stockholder’s failure to vote by proxy or to vote in person via the virtual meeting platform at the Special Meeting, as well as an abstention from voting and a broker non-vote with regard to the Governance Proposals will have no effect on the Governance Proposals. Abstentions will be counted in connection with the determination of whether a valid quorum is established but will have no effect on the Governance Proposals.

The approval of the Equity Incentive Plan Proposal requires the affirmative vote of a majority of the votes cast by holders of our outstanding shares of common stock represented in person via the virtual meeting platform or by proxy and entitled to vote at the Special Meeting. Accordingly, a stockholder’s failure to vote by proxy or to vote in person via the virtual meeting platform at the Special Meeting, as well as a broker non-vote with regard to the Equity Incentive Plan Proposal will have no effect on the Equity Incentive Plan Proposal. Abstentions will be counted in connection with the determination of whether a valid quorum is established but will have no effect on the Equity Incentive Plan Proposal.

The approval of the Employee Stock Purchase Plan Proposal requires the affirmative vote of a majority of the votes cast by holders of our outstanding shares of common stock represented in person via the virtual meeting platform or by proxy and entitled to vote at the Special Meeting. Accordingly, a stockholder’s failure to vote by proxy or to vote in person via the virtual meeting platform at the Special Meeting, as well as a broker non-vote with regard to the Employee Stock Purchase Plan Proposal will have no effect on the Employee Stock Purchase Plan Proposal. Abstentions will be counted in connection with the determination of whether a valid quorum is established but will have no effect on the Employee Stock Purchase Plan Proposal.

The approval of the Adjournment Proposal requires the affirmative vote of a majority of the votes cast by holders of outstanding shares of our common stock represented in person via the virtual meeting platform or by proxy and entitled to vote thereon at the Special Meeting. Accordingly, a stockholder’s failure to vote by proxy or to vote in person via the virtual meeting platform at the Special Meeting, as well as a broker non-vote with regard to the Adjournment Proposal will have no effect on the Adjournment Proposal. Abstentions will be counted in connection with the determination of whether a valid quorum is established but will have no effect on the Adjournment Proposal.

As further discussed in the section entitled “Other Agreements Related to the Business Combination Agreement—Sponsor Support Agreement,” dMY, IonQ, the Insiders and the Sponsor have entered into the Sponsor Support Agreement, pursuant to which the Insiders and the Sponsor have agreed to vote shares representing 20% of the aggregate voting power of our common stock (comprised of all the outstanding Founder Shares) in favor of the each of the proposals presented at the Special Meeting, regardless of how public stockholders vote. Accordingly, the Sponsor Support Agreement will increase the likelihood that we will receive the requisite stockholder approval for the Business Combination and the transactions contemplated thereby. Because a majority of the proposals, including the Transaction Proposal, require the affirmative vote of a majority of the votes cast by holders of outstanding shares of our common stock represented in person via the virtual meeting platform or by proxy and entitled to vote thereon at the Special Meeting, the affirmative vote of only 1,875,001 Public Shares, which represents approximately 6.25% of the outstanding Public Shares, in addition to the Founder Shares, would be required to approve such proposals if a quorum of only a majority of the shares of dMY’s common stock is represented at the Special Meeting. Notwithstanding the foregoing, consummation of the Business Combination is conditioned on the approval of each of the Required Proposals, which includes the Charter Proposal. Approval of the Charter Proposal requires the affirmative vote of holders of a majority of our outstanding shares of common stock entitled to vote thereon at the Special Meeting. Accordingly, the affirmative vote of approximately 11,250,001 Public Shares, which represents approximately 37.5% of the outstanding Public Shares, in addition to the Founder Shares, would be required to approve the Charter Proposal.

 

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Q:

What happens if the Transaction Proposal is not approved?

 

A:

If the Transaction Proposal or any of the other Required Proposals are not approved and we do not consummate an initial business combination by November 17, 2022, we will be required to dissolve and liquidate the Trust Account.

 

Q:

How many votes do I have at the Special Meeting?

 

A:

Our stockholders are entitled to one vote on each proposal presented at the Special Meeting for each share of common stock held of record as of             , 2021, the record date for the Special Meeting. As of the close of business on the record date, there were 37,500,000 outstanding shares of common stock, consisting of 30,000,000 outstanding shares of Class A Stock and 7,500,000 outstanding shares of Class B Stock.

 

Q:

What constitutes a quorum at the Special Meeting?

 

A:

A majority of the issued and outstanding shares of common stock entitled to vote as of the record date at the Special Meeting must be present, in person via the virtual meeting platform or represented by proxy, at the Special Meeting to constitute a quorum and in order to conduct business at the Special Meeting. Abstentions will be counted as present for the purpose of determining a quorum. Our Initial Stockholders, who currently own 20% of our issued and outstanding shares of common stock, will count towards this quorum. In the absence of a quorum, the chairman of the Special Meeting has power to adjourn the Special Meeting. As of the record date for the Special Meeting, 18,750,001 shares of common stock would be required to achieve a quorum.

 

Q:

How will the Sponsor and dMY’s officers and directors vote?

 

A:

Concurrently with the execution of the Merger Agreement, we entered into agreements with the Sponsor and the Insiders, pursuant to which each agreed to vote any shares of Class A Stock and Class B Stock owned by them in favor of the Transaction Proposal.

None of the Sponsor, directors or officers has purchased any shares of our common stock during or after the dMY IPO and, as of the date of this proxy statement/prospectus, neither we nor the Sponsor, directors or officers have entered into agreements, and are not currently in negotiations, to purchase shares prior to the consummation of the Business Combination. Currently, our Initial Stockholders own 20% of our issued and outstanding shares of common stock, including all of the Founder Shares, and will be able to vote all such shares at the Special Meeting.

 

Q:

What interests does the Sponsor and dMY’s officers and directors have in the Business Combination?

 

A:

The Sponsor, certain members of our Board and our officers may have interests in the Business Combination that are different from or in addition to (and which may conflict with) your interests. You should take these interests into account in deciding whether to approve the Business Combination. These interests include:

 

   

the fact that our Initial Stockholders have agreed not to redeem any of the Founder Shares in connection with a stockholder vote to approve a proposed initial business combination;

 

   

the fact that the Sponsor paid an aggregate of $8.0 million for its 4,000,000 Private Warrants to purchase shares of Class A Stock and that such Private Warrants will expire worthless if a business combination is not consummated by November 17, 2022. The Private Warrants would have had an aggregate market value of $            based upon the closing price of $            per Public Warrant on the NYSE on            , 2021, the most recent practicable date prior to the date of this proxy statement/prospectus. If the Business Combination is not consummated, our Sponsor will lose any theoretical gain on the shares underlying the Private Warrants;

 

   

the fact that the Sponsor paid an aggregate of $25,000 for the Founder Shares, and upon the completion of the Business Combination, the Founder Shares will convert into Class A common stock at a conversion rate that entitles the Sponsor to own, in the aggregate, [3.65]% of the common stock of the Combined Company after giving effect to the Business Combination. As a result, our Sponsor

 

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ultimately expects to receive 7,425,000 shares of common stock of the Combined Company in connection with the conversion of the Founder Shares as part of the Business Combination and such securities will have a significantly higher value at the time of the Business Combination which, if unrestricted and freely tradable, would be valued at approximately $            , based upon the closing price of $            per public share on the NYSE on            , 2021, the most recent practicable date prior to the date of this proxy statement/prospectus, resulting in a theoretical gain of $            , but, given the lock-up restrictions on such shares, we believe such shares have less value. If the Business Combination is not consummated, our Sponsor will lose any theoretical gain on its shares;

 

   

the fact that each of our independent directors currently holds 25,000 Founder Shares and expects to receive 25,000 shares of common stock of the Combined Company in connection with the conversion of the Founder Shares as part of the Business Combination. The 75,000 shares of common stock of the Combined Company expected to be owned by our independent directors would have had an aggregate market value of $            based upon the closing price of $            per public share on the NYSE on            , 2021, the most recent practicable date prior to the date of this proxy statement/prospectus;

 

   

the continued right of the Sponsor to hold Class A Stock and the shares of Class A Stock to be issued to the Sponsor upon exercise of its Private Warrants following the Business Combination, subject to certain lock-up periods;

 

   

if the Trust Account is liquidated, including in the event we are unable to complete an initial business combination within the required time period, the Sponsor has agreed to indemnify us to ensure that the proceeds in the Trust Account are not reduced below $10.00 per Public Share, or such lesser per Public Share amount as is in the Trust Account on the liquidation date, by the claims of prospective target businesses with which we have entered into an acquisition agreement or claims of any third party (other than our independent public accountants) for services rendered or products sold to us, but only if such a vendor or target business has not executed a waiver of any and all rights to seek access to the Trust Account;

 

   

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

 

   

the fact that the holders of Founder Shares, Private Warrants and warrants that may be issued upon conversion of certain working capital loans, if any, (and any shares of Class A Stock issuable upon the exercise of the Private Warrants) are entitled to registration rights pursuant to our existing registration rights agreement, to require us to register a sale of any of our securities held by them prior to the consummation of our initial business combination;

 

   

the fact that at the closing of the Business Combination, we will enter into the Registration Rights Agreement with the Registration Rights Holders (in which certain members of our Board and affiliates are included), which provides for registration rights to Registration Rights Holders and their permitted transferees;

 

   

the fact that concurrently with the execution and delivery of the Merger Agreement, we have entered into the Sponsor Support Agreement with the Insiders and the Sponsor, pursuant to which the Insiders and the Sponsor have agreed to (i) vote all of their shares (and their permitted transferees will agree to vote all of their shares) of Class A Stock and Class B Stock in favor of the proposals listed herein, which shares represent 20% of the outstanding shares of Class A Stock on an as-converted basis, (ii) not redeem any of their shares of Class A Stock in connection with the Business Combination and (iii) certain restrictions on certain of their shares of Class B Stock. Under the Sponsor Support Agreement, the Sponsor and each of the Insiders agrees that, effective upon the consummation of the Business Combination, 10% of the Founder Shares (750,000 shares), which will be converted into shares of Class A Stock at the consummation of the Business Combination, shall be unvested and shall be subject to certain vesting and forfeiture provisions (the “Vesting Shares”);

 

   

the fact that the Sponsor and its affiliates can earn a positive rate of return on their investment, even if other stockholders experience a negative rate of return in the post-business combination company;

 

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the fact that the Sponsor, officers and directors will lose their entire investment of approximately $7,525,000 in us and will not be reimbursed for any loans extended, fees due or out-of-pocket expenses if an initial business combination is not consummated by November 17, 2022; and

 

   

the fact that the Sponsor and members of our current Board and management would hold the following number of shares in the Combined Company at the consummation of the Business Combination:

 

Name of Person/Entity

   Shares of
Class A
Stock(1)
     Value of
Class A
Stock(3)
 

dMY Sponsor III, LLC (the Sponsor)(2)

     7,425,000      $ 74,250,000  

Harry L. You(2)

     7,425,000      $ 74,250,000  

Niccolo de Masi(2)

     —          —    

Darla Anderson(2)

     25,000      $ 250,000  

Francesca Luthi(2)

     25,000      $ 250,000  

Charles E. Wert(2)

     25,000      $ 250,000  

 

  (1) 

Interests shown consist solely of Founder Shares, classified as Class B common stock. Such shares will automatically convert into Class A common stock concurrently with or immediately following the consummation of the Business Combination on a one-for-one basis, subject to adjustment. Share amounts are subject to the full vesting of the Vesting Shares.

  (2) 

dMY Sponsor III, LLC is the record holder of the shares reported herein. Each of our officers and directors are among the members of dMY Sponsor III, LLC and Mr. You is the manager of dMY Sponsor III, LLC. Mr. You has voting and investment discretion with respect to the common stock held of record by dMY Sponsor III, LLC. Each of our officers and directors other than Mr. You disclaim any beneficial ownership of any shares held by dMY Sponsor III, LLC.

  (3) 

Assumes a value of $10.00 per share, the deemed value of the Class A Stock in the Business Combination.

These interests may influence our Board in making their recommendation that you vote in favor of the approval of the Business Combination.

 

Q:

What happens if I vote against the Transaction Proposal?

 

A:

If you vote against the Transaction Proposal but the Transaction Proposal still obtains the affirmative vote of a majority of the votes cast by holders of our outstanding shares of Common Stock represented in person via the virtual meeting platform or by proxy and entitled to vote at the Special Meeting, then the Transaction Proposal will be approved and, assuming the approval of the other Required Proposals and the satisfaction or waiver of the other conditions to closing, the Business Combination will be consummated in accordance with the terms of the Merger Agreement.

If you vote against the Transaction Proposal and the Transaction Proposal does not obtain the affirmative vote of a majority of the votes cast by holders of our outstanding shares of Common Stock represented in person via the virtual meeting platform or by proxy and entitled to vote at the Special Meeting, then the Transaction Proposal will fail and we will not consummate the Business Combination. If we do not consummate the Business Combination, we may continue to try to complete an initial business combination with a different target business until November 17, 2022. If we fail to complete an initial business combination by November 17, 2022, then we will be required to dissolve and liquidate the Trust Account by returning the then-remaining funds in such account to our public stockholders.

 

Q:

Do I have redemption rights?

 

A:

If you are a Public Stockholder, you may redeem your Public Shares for cash at the applicable redemption price per share equal to the quotient obtained by dividing (i) the aggregate amount on deposit in the Trust Account as of two business days prior to the consummation of the Business Combination, including interest not previously released to us to pay our taxes, by (ii) the total number of then-outstanding Public Shares; provided that we may not redeem any shares of Class A Stock issued in the dMY IPO to the extent that such

 

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  redemption would result in our failure to have net tangible assets (as determined in accordance with Rule 3a51-1(g)(1) of the Exchange Act) in excess of $5,000,001. A Public Stockholder, together with any of his, her or its affiliates or any other person with whom it is acting in concert or as a “group” (as defined under Section 13 of the Exchange Act), will be restricted from redeeming in the aggregate his, her or its shares or, if part of such a group, the group’s shares, in excess of 20% of the shares of Class A Stock included in the Public Units sold in the dMY IPO. Holders of our outstanding Public Warrants do not have redemption rights in connection with the Business Combination, however, the holders of such Public Warrants shall continue to be entitled to exercise such Public Warrants if the Business Combination is consummated, even if such holder chooses to redeem such holder’s Public Shares. The Sponsor, directors and officers have agreed to waive their redemption rights with respect to their shares of Common Stock in connection with the consummation of the Business Combination, and the Founder Shares will be excluded from the pro rata calculation used to determine the per-share redemption price. Our Initial Stockholders have also agreed to waive their right to a conversion price adjustment with respect to any shares of our Common Stock they may hold in connection with the consummation of the Business Combination. For illustrative purposes, based on the balance of our Trust Account of $300,077,389 as of March 31, 2021, the estimated redemption price would have been approximately $10.00 per share. Additionally, shares properly tendered for redemption will only be redeemed if the Business Combination is consummated; otherwise holders of such shares will only be entitled to a pro rata portion of the Trust Account (including interest not previously released to dMY or to pay our taxes) in connection with the liquidation of the Trust Account, unless we complete an alternative initial business combination prior to November 17, 2022.

 

Q:

Can our Initial Stockholders redeem their Founder Shares in connection with consummation of the Business Combination?

 

A:

No. Our Initial Stockholders, officers and other current directors have agreed to waive, for no consideration and for the sole purpose of facilitating the Business Combination, their redemption rights, with respect to their Founder Shares and any Public Shares they may hold, in connection with the consummation of the Business Combination.

 

Q:

Is there a limit on the number of shares I may redeem?

 

A:

Yes. A Public Stockholder, together with any affiliate of such stockholder or any other person with whom such stockholder is acting in concert or as a “group” (as defined under Section 13 of the Exchange Act), is restricted from exercising redemption rights with respect to more than an aggregate of 20% of the shares sold in the dMY IPO. Accordingly, all shares in excess of 20% owned by a holder or “group” of holders will not be redeemed for cash. On the other hand, a Public Stockholder who holds less than 20% of the Public Shares and is not a member of a “group” may redeem all of the Public Shares held by such stockholder for cash.

In no event is your ability to vote all of your shares (including those shares held by you or by a “group” in excess of 20% of the shares sold in the dMY IPO) for or against the Business Combination restricted.

We have no specified maximum redemption threshold under the Current Charter, other than the aforementioned 20% threshold. Each redemption of shares of Class A Stock by our public stockholders will reduce the amount in our Trust Account, which held cash and investment securities with a fair value of $         as of , 2021. However, in no event will we redeem shares of Class A Stock in an amount that would result in our failure to have net tangible assets equaling or exceeding $5,000,001.

 

Q:

Is there a limit on the total number of Public Shares that may be redeemed?

 

A:

Yes. The Current Charter provides that we may not redeem our Public Shares in an amount that would result in our failure to have net tangible assets equaling or exceeding $5,000,001 (such that we are not subject to the SEC’s “penny stock” rules) or any greater net tangible asset or cash requirement which may be contained in the Merger Agreement. Other than this limitation, the Current Charter does not provide a specified maximum redemption threshold. In the event the aggregate cash consideration we would be required to pay for all shares of Class A Stock that are validly submitted for redemption plus any amount

 

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  required to satisfy cash conditions pursuant to the terms of the Merger Agreement exceeds the aggregate amount of cash available to us, we may not complete the Business Combination or redeem any shares, all shares of Class A Stock submitted for redemption will be returned to the holders thereof, and we instead may search for an alternate initial business combination.

Based on the amount of funds in our Trust Account as of         , 2021, and assuming the funding in full of all amounts to be provided pursuant to the Subscription Agreements, approximately shares of Class A Stock may be redeemed and still enable us to have sufficient cash to satisfy the cash closing conditions in the Merger Agreement. We refer to this as the maximum redemption scenario.

 

Q:

Will how I vote affect my ability to exercise redemption rights?

 

A:

No. You may exercise your redemption rights whether you vote your Public Shares for or against, or whether you abstain from voting on, the Transaction Proposal, the NYSE Proposal, the Charter Proposal or any other proposal described by this proxy statement/prospectus. As a result, the Merger Agreement can be approved by stockholders who will redeem their shares and no longer remain stockholders, leaving stockholders who choose not to redeem their shares holding shares in a company with a potentially less-liquid trading market, fewer stockholders, potentially less cash and the potential inability to meet the listing standards of the NYSE.

 

Q:

How do I exercise my redemption rights?

 

A:

In order to exercise your redemption rights, you must (i) if you hold Public Units, separate the underlying Public Shares and Public Warrants and (ii) prior to 5:00 P.M., Eastern time on , 2021 (two business days before the Special Meeting), tender your shares physically or electronically and submit a request in writing that we redeem your Public Shares for cash to Continental Stock Transfer & Trust Company, the Transfer Agent, at the following address:

Continental Stock Transfer & Trust Company

1 State Street 30th Floor

New York, New York 10004

Attention: Mark Zimkind

Email: mzimkind@continentalstock.com

Notwithstanding the foregoing, a holder of the Public Shares, together with any affiliate of his or any other person with whom he is acting in concert or as a “group” (as defined in Section 13d-3 of the Exchange Act) will be restricted from seeking redemption rights with respect to more than 20% of the Public Shares included in the Public Units sold in the dMY IPO. Accordingly, all Public Shares in excess of the aforementioned 20% threshold beneficially owned by a Public Stockholder or group will not be redeemed for cash.

Stockholders seeking to exercise their redemption rights and opting to deliver physical certificates should allot sufficient time to obtain physical certificates from the Transfer Agent and time to effect delivery. It is our understanding that our stockholders should generally allot at least two weeks to obtain physical certificates from the Transfer Agent. However, we do not have any control over this process and it may take longer than two weeks. Stockholders who hold their shares in street name will have to coordinate with their bank, broker or other nominee to have the shares certificated or delivered electronically.

Stockholders seeking to exercise their redemption rights, whether they are record holders or hold their shares in “street name” are required to either tender their certificates to the Transfer Agent prior to the date set forth in this proxy statement/prospectus, or up to two business days prior to the vote on the proposal to approve the Business Combination at the Special Meeting, or to deliver their shares to the Transfer Agent electronically using the Depository Trust Company’s (DTC) Deposit/Withdrawal At Custodian (“DWAC”) system, at such stockholder’s option. The requirement for physical or electronic delivery prior to the Special Meeting ensures that a redeeming stockholder’s election to redeem is irrevocable once the Business Combination is approved.

 

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There is a nominal cost associated with the above-referenced tendering process and the act of certificating the shares or delivering them through the DWAC system. The Transfer Agent will typically charge a tendering broker a fee and it is in the broker’s discretion whether or not to pass this cost on to the redeeming stockholder. However, this fee would be incurred regardless of whether or not stockholders seeking to exercise redemption rights are required to tender their shares, as the need to deliver shares is a requirement to exercising redemption rights, regardless of the timing of when such delivery must be effectuated.

 

Q:

What are the U.S. federal income tax consequences of exercising my redemption rights?

 

A:

The U.S. federal income tax consequences of the redemption depends on particular facts and circumstances. Please see the section titled “Material Tax Considerations—U.S. Federal Income Tax Considerations for Stockholders Exercising Redemption Rights” for additional information. You are urged to consult your tax advisors regarding the tax consequences of exercising your redemption rights.

 

Q:

What are the U.S. federal income tax consequences of the Business Combination to holders of IonQ capital stock?

 

A:

It is intended that, for U.S. federal income tax purposes, the Business Combination will qualify as a “reorganization” under Section 368(a) of the Code (“Intended Tax Treatment”). If the Business Combination so qualifies, U.S. holders (as defined below in the section entitled “U.S. Federal Income Tax Considerations of the Business Combination to Holders of IonQ Capital Stock that are United States Persons”) of IonQ capital stock generally will not recognize any gain or loss for U.S. federal income tax purposes upon the exchange of IonQ capital stock for Class A Stock. Although the parties will use reasonable best efforts to cause the Business Combination to qualify for the Intended Tax Treatment (including, under certain circumstances, changing the structure of the Business Combination), no assurance can be given that the IRS will not challenge the Intended Tax Treatment or that a court would not sustain such a challenge. Neither dMY nor IonQ intends to request a ruling from the IRS regarding the U.S. federal income tax consequences of the Business Combination. It is not a condition to the completion of the Business Combination that either dMY or IonQ receives an opinion of counsel dated as of the closing date to the effect that the Business Combination will so qualify, and the Business Combination will occur even if it does not so qualify, in which case it will be a fully taxable transaction. In connection with the effectiveness of the Registration Statement of which this proxy statement/prospectus is a part, Cleary Gottlieb Steen & Hamilton LLP, counsel to dMY, has issued an opinion to dMY, and Cooley LLP, counsel to IonQ, has issued an opinion to IonQ, that the Business Combination will qualify as a “reorganization” within the meaning of Section 368(a) of the Code for U.S. federal income tax purposes. These opinions are not binding on the IRS or any court. Further, they are prospective, dependent on future events, and based on customary assumptions and representations from dMY, Merger Sub and IonQ, as well as certain covenants and undertakings by dMY, Merger Sub and IonQ (collectively, the “tax opinion representations and assumptions”). If any of the tax opinion representations and assumptions is incorrect, incomplete or inaccurate, or is violated, the validity of the opinion described above may be affected and the tax consequences of the Business Combination could differ from those described in this proxy statement/prospectus. You should read the section entitled “U.S. Federal Income Tax Considerations of the Business Combination to Holders of IonQ Capital Stock that are United States Persons” and consult your own tax advisors regarding the U.S. federal income tax consequences of the Business Combination to your particular circumstances, as well as tax consequences arising under the laws of any state, local or non-U.S. taxing jurisdiction.

 

Q:

If I am a Public Warrant holder, can I exercise redemption rights with respect to my Public Warrants?

 

A:

No. The holders of Public Warrants have no redemption rights with respect to such Public Warrants.

 

Q:

Do I have appraisal rights or dissenters’ rights if I object to the proposed Business Combination?

 

A:

No. Appraisal rights or dissenters’ rights are not available to holders of shares of Common Stock in connection with the Business Combination.

 

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Q:

What happens to the funds held in the Trust Account upon consummation of the Business Combination?

 

A:

If the Business Combination is consummated, the funds held in the Trust Account will be used to: (i) pay our public stockholders who properly exercise their redemption rights; (ii) pay the Deferred Discount to the underwriters of the dMY IPO, in connection with the Business Combination; and (iii) pay certain other fees, costs and expenses (including regulatory fees, legal fees, accounting fees, printer fees and other professional fees) that were incurred in connection with the transactions contemplated by the Merger Agreement, including the Business Combination, and pursuant to the terms of the Merger Agreement. Any remaining funds will be used by the Combined Company for general corporate purposes.

 

Q:

What conditions must be satisfied to complete the Business Combination?

 

A:

There are a number of closing conditions in the Merger Agreement, including the expiration of the applicable waiting period under the HSR Act, the approval and adoption by the IonQ stockholders of the Merger Agreement and the transactions contemplated thereby and the approval by the stockholders of dMY of the Transaction Proposal, the NYSE Proposal and the Charter Proposal. For a summary of the conditions that must be satisfied or waived prior to completion of the Business Combination, please see the section titled “The Merger Agreement and Related Agreements.”

 

Q:

What happens if the Business Combination is not consummated?

 

A:

There are certain circumstances under which the Merger Agreement may be terminated. Please see the section titled “The Merger Agreement and Related Agreements” for information regarding the parties’ specific termination rights.

If we do not consummate the Business Combination, we may continue to try to complete an initial business combination with a different target business until November 17, 2022. Unless we amend the Current Charter (which requires the affirmative vote of 65% of all then outstanding shares of Common Stock) and amend certain other agreements into which we have entered to extend the life of dMY, if we fail to complete an initial business combination by November 17, 2022, then we will: (i) cease all operations except for the purpose of winding up; (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem our Public Shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account, including interest not previously released to us to pay our taxes (less up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding Public Shares, which redemption will completely extinguish our public stockholders’ rights as stockholders (including the right to receive further liquidating distributions, if any), subject to applicable law; and (iii) as promptly as reasonably possible following such redemption, subject to the approval of our remaining stockholders and our Board, dissolve and liquidate, subject in each case to our obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law. In the event of such distribution, it is possible that the per share value of the residual assets remaining available for distribution (including Trust Account assets) will be less than the initial public offering price per unit in the dMY IPO. Please see the section titled “Risk Factors—Risks Related to dMY, the Combined Company and the Business Combination.

Holders of our Founder Shares have waived any right to any liquidating distributions with respect to such shares. In addition, if we fail to complete a business combination by November 17, 2022, there will be no redemption rights or liquidating distributions with respect to our outstanding warrants, which will expire worthless.

 

Q:

When is the Business Combination expected to be completed?

 

A:

The consummation of the Business Combination is expected to take place on or prior to the third business day following the satisfaction or waiver of the conditions described below in the subsection titled “The Merger Agreement and Related Agreements–Conditions to Closing.” Following the consummation of the Business Combination, Merger Sub will merge with and into IonQ, with IonQ surviving the Merger as the Surviving Corporation. The Merger will become effective at the time and on the date specified in the

 

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  certificate of mergers in accordance with the DGCL. The closing of the Business Combination is expected to occur in the second quarter of 2021. The Merger Agreement may be terminated by dMY or IonQ if the consummation of the Business Combination has not occurred by December 7, 2021, except that such right to terminate the Merger Agreement shall not be available to a party that has breached any of its representations, warranties, covenants or agreements under the Merger Agreement and such breach is the primary cause of or has resulted in the failure of the Business Combination to be consummated on or before such date.

For a description of the conditions to the closing of the Business Combination, see the section titled “The Merger Agreement and Related Agreements–Conditions to Closing of the Business Combination.”

 

Q:

What do I need to do now?

 

A:

You are urged to read carefully and consider the information contained in this proxy statement/prospectus, including the Annexes, and to consider how the Business Combination will affect you as a stockholder. You should then vote as soon as possible in accordance with the instructions provided in this proxy statement/prospectus and on the enclosed proxy card or, if you hold your shares through a brokerage firm, bank or other nominee, on the voting instruction form provided by the broker, bank or nominee.

 

Q:

How do I vote?

 

A:

The Special Meeting will be held via live webcast on         , 2021, at          Eastern time. The Special Meeting can be accessed by visiting https://www.cstproxy.com/dmytechnologyiii/sm2021, where you will be able to listen to the meeting live and vote during the meeting. Please note that you will only be able to access the Special Meeting by means of remote communication.

If you are a holder of record of shares of Common Stock on         , 2021, the record date, you may vote at the Special Meeting or by submitting a proxy for the Special Meeting. You may submit your proxy by completing, signing, dating and returning the enclosed proxy card in the accompanying pre-addressed postage paid envelope. If you hold your shares in “street name,” which means your shares are held of record by a broker, bank or nominee, you should contact your broker to ensure that votes related to the shares you beneficially own are properly counted. In this regard, you must provide the broker, bank or nominee with instructions on how to vote your shares or, if you wish to attend the Special Meeting and vote, obtain a proxy from your broker, bank or nominee.

For additional information, please see the section titled “Special Meeting of the Stockholders of dMY.”

 

Q:

How can I attend the Special Meeting?

 

A:

If you are a registered stockholder you received a Notice and Access instruction form or proxy card from the Transfer Agent. Both forms contain instructions on how to attend the virtual Special Meeting including the URL address, along with your control number. You will need your control number for access. If you do not have your control number, contact the Transfer Agent at the phone number or e-mail address below. The Transfer Agent’s contact information is as follows: 917-262-2373, or email proxy@continentalstock.com.

You can pre-register to attend the virtual Special Meeting starting         , 2021 at         Eastern time. Enter the URL address into your browser                 , enter your control number, name and email address. Once you pre-register you can vote or enter questions in the chat box. At the start of the meeting you will need to re-log in using your control number and will also be prompted to enter your control number if you vote during the meeting. We recommend that you log in at least 15 minutes before the meeting to ensure you are logged in when the Special Meeting starts.

Beneficial investors, who own their investments through a bank or broker, will need to contact the Transfer Agent to receive a control number. If you plan to vote at the Special Meeting you will need to have a legal proxy from your bank or broker or if you would like to join and not vote the Transfer Agent will issue you a guest control number with proof of ownership. Either way you must contact the Transfer Agent for specific instructions on how to receive the control number. The Transfer Agent can be contacted at the number or email address above. Please allow up to 72 hours prior to the meeting for processing your control number.

 

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If you do not have internet capabilities, you can listen only to the meeting by dialing +1 (toll-free) outside the U.S. and Canada +1 (standard rates apply) when prompted enter the pin number #. This is listen-only, you will not be able to vote or enter questions during the meeting

 

Q:

What if during the check-in time or during the Special Meeting I have technical difficulties or trouble accessing the virtual meeting website?

 

A:

If you encounter any difficulties accessing the virtual meeting during the check-in or meeting time, please call the technical support number that will be posted on the virtual stockholder meeting log in page.

 

Q:

What will happen if I abstain from voting or fail to vote at the Special Meeting?

 

A:

At the Special Meeting, we will count a properly executed proxy marked “ABSTAIN” with respect to a particular proposal as present for purposes of determining whether a quorum is present. For purposes of approval, a failure to vote or an abstention will have no effect on the Transaction Proposal, the NYSE Proposal, the Governance Proposals, the Equity Incentive Plan Proposal, the Employee Stock Purchase Plan Proposal or the Adjournment Proposal; a failure to vote or abstention will have the same effect as a vote “AGAINST” the Charter Proposal.

 

Q:

What will happen if I sign and return my proxy card without indicating how I wish to vote?

 

A:

Signed and dated proxies we receive without an indication of how the stockholder intends to vote on a proposal will be voted “FOR” each proposal presented to the stockholders. The proxyholders may use their discretion to vote on any other matters that properly come before the Special Meeting.

 

Q:

If I am not going to attend the Special Meeting via the virtual meeting platform, should I return my proxy card instead?

 

A:

Yes. Whether you plan to attend the Special Meeting or not, please read the enclosed proxy statement/prospectus carefully, and vote your shares by completing, signing, dating and returning the enclosed proxy card in the postage-paid envelope provided.

 

Q:

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

 

A:

No. Under the rules of various national and regional securities exchanges, your broker, bank, or nominee cannot vote your shares with respect to non-discretionary matters unless you provide instructions on how to vote in accordance with the information and procedures provided to you by your broker, bank, or nominee. We believe that all of the proposals presented to the stockholders at this Special Meeting will be considered non-discretionary and, therefore, your broker, bank, or nominee cannot vote your shares without your instruction on any of the proposals presented at the Special Meeting. If you do not provide instructions with your proxy, your broker, bank, or other nominee may deliver a proxy card expressly indicating that it is NOT voting your shares; this indication that a broker, bank, or nominee is not voting your shares is referred to as a “broker non-vote.” Broker non-votes will not be counted for the purposes of determining the existence of a quorum or for purposes of determining the number of votes cast at the Special Meeting. Your bank, broker, or other nominee can vote your shares only if you provide instructions on how to vote. You should instruct your broker to vote your shares in accordance with directions you provide.

 

Q:

How will a broker non-vote impact the results of each proposal?

 

A:

Broker non-votes will count as a vote “AGAINST” the Charter Proposal but will not have any effect on the outcome of any other proposals.

 

Q:

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

 

A:

Yes. You may change your vote by sending a later-dated, signed proxy card to our Secretary at the address listed below so that it is received by our Secretary prior to the Special Meeting or attend the Special Meeting in person via the virtual meeting platform and vote. You also may revoke your proxy by sending a notice of revocation to our Secretary, which must be received by our Secretary prior to the Special Meeting.

 

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Q:

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

 

A:

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

 

Q:

Who will solicit and pay the cost of soliciting proxies for the Special Meeting?

 

A:

We will pay the cost of soliciting proxies for the Special Meeting. We have engaged Morrow Sodali (“Morrow Sodali”) to assist in the solicitation of proxies for the Special Meeting. We have agreed to pay Morrow Sodali a fee of $25,000, plus disbursements, and will reimburse Morrow Sodali for its reasonable out-of-pocket expenses and indemnify Morrow Sodali and its affiliates against certain claims, liabilities, losses, damages and expenses. We will also reimburse banks, brokers and other custodians, nominees and fiduciaries representing beneficial owners of shares of our Common Stock for their expenses in forwarding soliciting materials to beneficial owners of shares of our Common Stock and in obtaining voting instructions from those owners. Our directors, officers and employees may also solicit proxies by telephone, by facsimile, by mail, on the Internet or in person. They will not be paid any additional amounts for soliciting proxies.

 

Q:

Who can help answer my questions?

 

A:

If you have questions about the proposals or if you need additional copies of this proxy statement/prospectus or the enclosed proxy card you should contact:

dMY Technology Group, Inc. III

1180 North Town Center Drive, Suite 100

Las Vegas, Nevada 89144

Email: IR@dmytechnology.com

You may also contact the proxy solicitor for dMY at:

Morrow Sodali

470 West Avenue

Stamford CT 06902

Individuals call toll-free: (800) 662-5200

Banks and brokers call: (203) 658-9400

DMYI.info@investor.morrowsodali.com

To obtain timely delivery, stockholders must request the materials no later than             , 2021, or five business days prior to the Special Meeting.

You may also obtain additional information about dMY from documents filed with the SEC by following the instructions in the section titled “Where You Can Find More Information.”

If you intend to seek redemption of your Public Shares, you will need to send a letter demanding redemption and deliver your Public Shares (either physically or electronically) to the Transfer Agent prior to the Special Meeting in accordance with the procedures detailed under the question “How do I exercise my redemption rights?” If you have questions regarding the certification of your position or delivery of your Public Shares, please contact the Transfer Agent:

Continental Stock Transfer & Trust Company

1 State Street 30th Floor

New York, New York 10004

Attention: Mark Zimkind

Email: mzimkind@continentalstock.com

 

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SUMMARY

This summary highlights selected information contained in this proxy statement/prospectus and does not contain all of the information that is important to you. You should read carefully this entire proxy statement/prospectus, including the Annexes and accompanying financial statements of dMY and IonQ, to fully understand the proposed Business Combination (as described below) before voting on the proposals to be considered at the Special Meeting (as described below). Please see the section titled “Where You Can Find More Information.”

Unless otherwise specified, all share calculations assume (i) no exercise of redemption rights by our public stockholders; and (ii) no inclusion of any Public Shares issuable upon the exercise of the Warrants.

dMY

dMY is a blank check company incorporated on September 14, 2020 as a Delaware corporation and formed for the purpose of effecting an initial business combination with one or more target businesses.

The Public Shares, Public Units and Public Warrants are traded on the NYSE under the ticker symbols “DMYI,” “DMYI-UN” and “DMYI-WT,” respectively. dMY intends to apply to continue the listing of its Common Stock and Public Warrants on the NYSE under the symbols “IONQ” and “IONQ WS,” respectively, upon the consummation of the Business Combination.

The mailing address of our principal executive office is 1180 North Town Center Drive, Suite 100, Las Vegas, Nevada 89144.

IonQ

IonQ is developing quantum computers designed to solve the world’s most complex problems, and transform business, society and the planet for the better. IonQ believes that its proprietary technology, its architecture and the technology exclusively available to it through license agreements will offer it advantages both in terms of research and development, as well as the commercial value of its intended product offerings. IonQ sells access to a quantum computer with 11 qubits and it is in the process of researching and developing technologies for quantum computers with increasing computational capabilities. IonQ currently makes access to its quantum computers available via two major cloud platforms, Amazon Web Services’ (AWS) Amazon Braket and Microsoft’s Azure Quantum, and also to select customers via IonQ’s own cloud service.

IonQ is still in the early stages of generating revenue with its 11-qubit quantum computer. Since its inception, IonQ has incurred significant operating losses. IonQ’s net losses were $15.4 million and $7.3 million for the year ended December 31, 2020 and the three months ended March 31, 2021, respectively, and it expects to continue to incur significant losses for the foreseeable future. As of March 31, 2021, IonQ had an accumulated deficit of $46.9 million.

Following the Business Combination, IonQ will change its name to IonQ Quantum, Inc. and will be a wholly owned subsidiary of the Combined Company.

The mailing address of IonQ’s principal office is 4505 Campus Drive, College Park, Maryland 20740.

The Business Combination

General

On March 7, 2021, dMY entered into the Merger Agreement with Merger Sub and IonQ. Pursuant to the Merger Agreement and in connection therewith, among other things and subject to the terms and conditions contained therein:

 

   

at the consummation of the Business Combination, Merger Sub will merge with and into IonQ, with IonQ continuing as the Surviving Corporation and a wholly owned subsidiary of dMY;


 

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prior to the consummation of the Business Combination (and subject to approval by our stockholders), we will adopt the Proposed Charter, to provide for, among other things, the authorization of the Class A Stock to be issued in connection with the Business Combination;

 

   

in connection with the Business Combination, holders of shares of IonQ capital stock (other than holders of any shares of IonQ capital stock held in the treasury of IonQ or owned by dMY, Merger Sub or IonQ immediately prior to the effective time, which will be canceled without any conversion thereof and no payment or distribution will be made with respect thereto) will receive, in exchange for their IonQ capital stock, the Aggregate Stock Consideration, except to the extent that any such holder duly exercises and perfects dissenters’ rights with respect to such IonQ capital stock in accordance with Section 262 of the DGCL. Holders of shares of IonQ capital stock will be entitled to receive a number of shares of newly-issued Class A Stock equal to the Per Share IonQ Stock Consideration for each such share of IonQ capital stock;

 

   

at the consummation of the Business Combination, the Registration Rights Holders will enter into the Registration Rights Agreement, pursuant to which, (a) any (i) outstanding share of Class A Stock or any Private Warrants, (ii) shares of Class A Stock issued or issuable upon the exercise of any other equity security of dMY (including shares of Class A Stock issued or issuable upon the conversion of the Class B Stock and upon exercise of the Private Warrants) and (b) any other equity security of dMY issued or issuable with respect to any such share of Class A Stock by way of a stock dividend or stock split or in connection with a combination of shares, recapitalization, merger, consolidation or other reorganization or otherwise, will be entitled to registration rights; and

 

   

concurrently with the execution and delivery of the Merger Agreement, we have entered into the Sponsor Support Agreement with the Insiders, the Sponsor and IonQ, pursuant to which the Insiders and the Sponsor have agreed to (i) vote all of their shares (and their permitted transferees will agree to vote all of their shares) of Class A Stock and Class B Stock in favor of the proposals listed herein, which shares represent 20% of the outstanding shares of Class A Stock on an as-converted basis, (ii) not redeem any of the shares of dMY stock owned by such holder in connection with the stockholder approvals contemplated hereby and (iii) certain restrictions on certain of their shares of Class B Stock. Under the Sponsor Support Agreement, the Sponsor and each of the Insiders agrees that, effective upon the consummation of the Business Combination, 10% of the Founder Shares (750,000 shares), which will be converted into shares of Class A Stock at the consummation of the Business Combination, shall be unvested and shall be subject to certain vesting and forfeiture provisions.

Consideration in the Business Combination

Pursuant to the Merger Agreement, the IonQ stockholders will receive stock consideration. At the consummation of the Business Combination, each IonQ stockholder will receive for each share of IonQ capital stock it holds (other than any shares of IonQ capital stock held in treasury of IonQ or owned by dMY, Merger Sub or IonQ immediately prior to the effective time, which will be canceled without any conversion thereof and no payment or distribution will be made with respect thereto) a number of newly issued shares of Class A Stock equal to the Per Share IonQ Stock Consideration, except to the extent that any such holder duly exercises and perfects dissenters’ rights with respect to such IonQ capital stock in accordance with Section 262 of the DGCL.

No fractional shares of Class A Stock will be issued. In lieu of the issuance of any such fractional shares, dMY shall aggregate the total number of shares of Class A Stock issuable to each IonQ stockholder upon the surrender for exchange of IonQ capital stock, and then round down to the nearest whole number of shares of Class A Stock for each such IonQ stockholder.


 

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Conditions to Closing of the Business Combination

The Merger Agreement is subject to the satisfaction or waiver of certain customary closing conditions, including, among others:

 

   

expiration or termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act and any other required regulatory approvals;

 

   

the absence of any applicable law in effect that makes the consummation of the transactions contemplated by the Merger Agreement illegal or any order in effect preventing the consummation of the transactions contemplated by the Merger Agreement;

 

   

approval of the Required Proposals by the stockholders of dMY;

 

   

approval of the Merger Agreement and the other transactions contemplated thereby by the stockholders of IonQ;

 

   

effectiveness of the registration statement on Form S-4 to be filed by dMY in connection with the Merger with no stop order having been issued by the SEC which remains in effect with respect to the registration statement, and no proceeding seeking such a stop order being threatened or initiated by the SEC which remains pending;

 

   

that dMY has at least $5,000,001 of net tangible assets (as determined in accordance with Rule 3a51-1(g)(1) of the Exchange Act) remaining after the exercise of redemption rights by the holders of Public Shares after giving effect to the transactions contemplated by the Merger Agreement, including the PIPE Investment;

 

   

receipt of approval for listing on the New York Stock Exchange the shares of dMY’s Class A common stock to be issued in connection with the closing subject only to official notice of issuance;

 

   

consummation of the PIPE Investment prior to or substantially concurrently with the closing in an amount not less than $332.64 million; and

 

   

the Available Cash (as defined in the Merger Agreement) shall not be less than $225.0 million. 

Related Agreements

Subscription Agreements

On March 7, 2021, concurrently with the execution of the Merger Agreement, dMY entered into Subscription Agreements with the PIPE Investors, pursuant to, and on the terms and subject to the conditions of which, the PIPE Investors have collectively subscribed for 35,000,000 shares of Class A Stock for an aggregate purchase price equal to $350.0 million.

The Subscription Agreements for the PIPE Investors provide for certain registration rights. In particular, dMY is required to, prior to or at (or, with respect to certain strategic, venture capital and other investors, within 15 business days after) the consummation of the Business Combination, file a registration statement registering the resale of such shares. Additionally, dMY is required to use commercially reasonable efforts to have the registration statement declared effective as soon as practicable after the filing thereof, but no later than the earlier of (i) 30 calendar days following the filing date thereof, provided that the effectiveness deadline will be extended to 60 calendar day after the filing date if the SEC reviews and provides comments to the registration statement and (ii) the 5th business day after the date dMY is notified (orally or in writing, whichever is earlier) by the SEC that the registration statement will not be “reviewed” or will not be subject to further review, or on the consummation of the Business Combination, if later. dMY is required to use commercially reasonable efforts to keep the registration statement effective until the earliest of: (i) two years from the issuance of the subscribed shares, (ii) the date on which all of the subscribed shares have been sold or (iii) the date all registrable shares held by the PIPE Investors may be sold without restriction under Rule 144.


 

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The Subscription Agreements will terminate with no further force and effect upon the earliest to occur of: (a) such date and time as the Merger Agreement is terminated in accordance with its terms; (b) the mutual written agreement of the parties to such Subscription Agreement; (c) if any of the conditions to closing set forth in such Subscription Agreement are not satisfied on or prior to the consummation of the Business Combination or are waived by the party entitled to grant such waiver and as a result thereof, the transactions contemplated by the Subscription Agreement are not consummated; or (d) certain dates as specified in certain of the Subscription Agreements.

Sponsor Support Agreement

Concurrently with the execution and delivery of the Merger Agreement, dMY, IonQ, the Insiders and the Sponsor have entered into the Sponsor Support Agreement, pursuant to which the Insiders and the Sponsor have agreed to (i) vote all of their shares (and their permitted transferees will agree to vote all of their shares) of Class A Stock and Class B Stock, which shares represent 20% of the outstanding shares of Class A Stock on an as-converted basis, in favor of the proposals listed herein, (ii) not redeem any of the shares of dMY stock owned by such holder in connection with the stockholder approvals contemplated hereby and (iii) certain restrictions on certain of their shares of Class B Stock.

Under the Sponsor Support Agreement, it was agreed by the Sponsor and each of the Insiders that, effective upon the consummation of the Business Combination, 10% of the Founder Shares (750,000 shares), which will be converted into shares of Class A Stock at the consummation of the Business Combination, shall be unvested and shall be subject to certain vesting and forfeiture provisions, according to which (i) one-third of the Vesting Shares beneficially owned by the Sponsor and each of the Insiders shall vest at such time as (x) the closing price of Class A Stock equals or exceeds $12.50 for any 20 Trading Days during any period of 30 consecutive Trading Days or (y) the Combined Company consummates a Subsequent Transaction which results in its stockholders having the right to exchange their shares for cash, securities or other property having a value of at least $12.50 per share, on or before the date that is five years after the consummation of the Business Combination, (ii) one-third of the Vesting Shares beneficially owned by the Sponsor and each of the Insiders shall vest at such time as (x) the closing price of Class A Stock equals or exceeds $15.00 for any 20 Trading Days during any period of 30 consecutive Trading Days or (y) the Combined Company consummates a Subsequent Transaction which results in its stockholders having the right to exchange their shares for cash, securities or other property having a value of at least $15.00 per share, on or before the date that is five years after the consummation of the Business Combination and (iii) one-third of the Vesting Shares beneficially owned by the Sponsor and each of the Insiders shall vest at such time as (x) the closing price of Class A Stock equals or exceeds $17.50 for any 20 Trading Days during any period of 30 consecutive Trading Days or (y) the Combined Company consummates a Subsequent Transaction which results in its stockholders having the right to exchange their shares for cash, securities or other property having a value of at least $17.50 per share, on or before the date that is five years after the consummation of the Business Combination. Vesting Shares that remain unvested on the first business day after five years from the closing of the Business Combination will be surrendered by the Insiders to the Combined Company without any consideration for such transfer.

IonQ Stockholder Support Agreement

On March 7, 2021, dMY, IonQ and certain IonQ stockholders, including holders affiliated with members of IonQ’s board of directors and beneficial owners of greater than 5% of IonQ’s capital stock, representing 54.88% of the voting power of IonQ’s then-outstanding shares of capital stock, entered into the IonQ Stockholder Support Agreement, whereby such IonQ stockholders agreed to, among other things, promptly (and in any event within three business days) following the SEC declaring effective this proxy statement/prospectus, vote or provide consent with respect to the securities of IonQ set forth in the IonQ Stockholder Support Agreement, in favor of the approval and adoption of the Merger Agreement and the transactions contemplated therein, including


 

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the conversion, effective immediately prior to and subject to occurrence of the effective time, of each outstanding share of IonQ preferred stock into shares of IonQ common stock in accordance with the Amended and Restated Certificate of Incorporation of IonQ. Additionally, such IonQ stockholders agreed, among other things, to not transfer any securities of IonQ set forth in the IonQ Stockholder Support Agreement from March 7, 2021 until the earlier of the effective time or the termination of the Merger Agreement in accordance with its terms, subject to certain exceptions.

The Merger Agreement, Form of Subscription Agreement and Form of Stockholder Support Agreement (the “Included Agreements”) have been included to provide investors with information regarding their terms. They are not intended to provide any other factual information about dMY or its affiliates. The representations, warranties, covenants and agreements contained in the Included Agreements and the other documents related thereto were made only for purposes of the Merger Agreement as of the specific dates therein, were solely for the benefit of the parties to the Merger Agreement, Form of Subscription Agreement and Form of Stockholder Support Agreement, may be subject to limitations agreed upon by the contracting parties, including being qualified by confidential disclosures made for the purposes of allocating contractual risk between the parties to the Included Agreements instead of establishing these matters as facts, and may be subject to standards of materiality applicable to the contracting parties that differ from those applicable to investors. Investors are not third-party beneficiaries under the Included Agreements and should not rely on the representations, warranties, covenants and agreements or any descriptions thereof as characterizations of the actual state of facts or condition of the parties thereto or any of their respective subsidiaries or affiliates. Moreover, information concerning the subject matter of representations and warranties may change after the date of the Included Agreements, as applicable, which subsequent information may or may not be fully reflected in dMY’s public disclosures.

Registration Rights Agreement

At the closing, dMY, the Sponsor, the officers and directors of IonQ and certain other existing shareholders of IonQ will enter into the Registration Rights Agreement, pursuant to which, among other things:

 

  (i)

dMY, the Sponsor and IonQ’s officers and directors will agree to amend and restate the Registration Rights Agreement, dated as of November 12, 2020, entered into in connection with the dMY IPO; and

 

  (ii)

the Combined Company will provide certain registration rights for the common stock and Warrants held by the parties to the Registration Rights Agreement.


 

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Organizational Structure

The diagrams below depict simplified versions of the current organizational structures of dMY and IonQ, respectively.

dMY (Current Structure)

 

LOGO

IonQ (Current Structure)

 

LOGO


 

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Post-Business Combination Structure

The diagram below depicts a simplified version of the Combined Company’s organizational structure immediately following the completion of the Business Combination.

 

LOGO

Impact of the Business Combination on the Combined Company’s Public Float

It is anticipated that, upon the consummation of the Business Combination:

 

   

dMY Insiders and the Sponsor will retain an ownership interest of approximately 3.69% in the Combined Company;

 

   

dMY’s public stockholders will retain an ownership interest of approximately 14.78% in the Combined Company;

 

   

the PIPE Investors affiliated with IonQ will own approximately 1.21% of the Combined Company with respect to their PIPE Shares only;

 

   

the non-affiliated PIPE Investors will own approximately 16.04% of the Combined Company; and

 

   

the former IonQ Equityholders will own approximately 64.28% of the Combined Company.

These levels of ownership interest:

 

   

exclude the impact of the Class A Stock underlying Public Warrants and Private Warrants;

 

   

assume that no Public Stockholder exercises redemption rights with respect to its shares for a pro rata portion of the funds in Trust Account;

 

   

include the impact of the vested IonQ Stock Options that are outstanding as of June 7, 2021 and will be assumed by the Combined Company (it being understood that as the outstanding IonQ Stock Options vest in accordance with their respective terms, the number of shares of IonQ capital stock subject to such vested IonQ Stock Options shall be included in the calculation of the IonQ Stock Adjusted Fully Diluted Shares and the resulting Exchange Ratio);

 

   

exclude the impact of the unvested IonQ Stock Options that are outstanding as of June 7, 2021 and will be assumed by the Combined Company as the Merger Agreement provides that the shares underlying such unvested IonQ Stock Options are not included in the calculation of the IonQ Stock Adjusted Fully Diluted Shares and the resulting Exchange Ratio;


 

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include the impact of the vested IonQ Warrants that are outstanding as of June 7, 2021 (it being understood that as the outstanding IonQ Warrants vest in accordance with their respective terms, the number of shares of IonQ capital stock subject to such vested IonQ Warrants shall be included in the calculation of the IonQ Stock Adjusted Fully Diluted Shares and the resulting Exchange Ratio);

 

   

exclude the impact of the unvested IonQ Warrants that are outstanding as of June 7, 2021, as the Merger Agreement provides that the shares underlying such unvested IonQ Warrants are not included in the calculation of the IonQ Stock Adjusted Fully Diluted Shares and the resulting Exchange Ratio;

 

   

include the Vesting Shares held by the dMY Insiders and the Sponsor;

 

   

assume that no shares are issued pursuant to the 2021 Plan; and

 

   

assume that no shares are issued pursuant to the Employee Stock Purchase Plan. See the sections titled “Unaudited Pro Forma Combined Financial Information,” “Proposal No. 5—The Equity Incentive Plan Proposal” and “Proposal No. 6—The Employee Stock Purchase Plan Proposal” of this proxy statement/prospectus for additional information.

The following table illustrates varying beneficial ownership levels in the Combined Company, assuming no redemptions by dMY’s public stockholders and the maximum redemptions by dMY’s public stockholders:

 

    No Redemptions(1)     Maximum
Redemptions(2)
 

Pro Forma Ownership

  Number of
Shares of
Class A Stock
    % of O/S     Number of
Shares of
Class A Stock
    % of O/S  

dMY Public Stockholder

    30,000,000       14.78           0.00

dMY Insiders and Sponsor(3)

    7,500,000       3.69     7,500,000       4.33

PIPE Investors — affiliates of IonQ with respect to PIPE Shares only(4)(5)

    2,450,000       1.21     2,450,000       1.42

PIPE Investors — Non-affiliated holders(4)(5)

    32,550,000       16.04     32,550,000       18.82

Former equityholders of IonQ(6)(7)(8)

    130,481,064       64.28     130,481,064       75.43

 

(1) 

Assumes that no shares of Class A Stock are redeemed and excludes potential dilution from Public Warrants and Private Warrants.

(2) 

Assumes maximum redemptions of 30,000,000 Class A Stock for aggregate redemption payments of $300 million using a per-share redemption price of $10.00 (due to investment-related gains in the Trust Account). Closing of the Business Combination is conditioned on, among other things, the aggregate cash proceeds from the Trust Account, together with the proceeds from the PIPE Investment, equaling no less than $225.0 million (after deducting any amounts paid to dMY public stockholders that exercise their redemption rights in connection with the Business Combination).

(3) 

Share amounts are subject to the full vesting of the Vesting Shares.

(4) 

Assumes the PIPE Investment is consummated in accordance with its terms for $350.0 million, with 35,000,000 shares of Class A Stock issued to the PIPE Investors.

(5) 

Certain affiliates of IonQ have entered into subscription agreements with respect to the PIPE Investment.

(6) 

Assumes stock consideration of 123,808,665 shares of Class A Stock and a Net Equity Adjustment of $29,810,718 based on IonQ’s estimate, as of June 7, 2021, with respect to the cash, indebtedness and transaction expenses of IonQ and dMY.

(7) 

Includes approximately 6,118,319 shares of Class A Stock issuable upon the exercise of IonQ Stock Options vested as of June 7, 2021 (on a net share settled basis, assuming a price per share of the Combined Company common stock of $10.00 per share) to acquire Class A Stock following the conversion of IonQ Stock Options. IonQ Stock Options do not represent legally outstanding shares of common stock at closing.

(8) 

Includes approximately 554,080 shares of Class A Stock issuable upon the exercise of IonQ Warrants vested as of June 7, 2021 (on a net share settled basis, assuming a price per share of the Combined Company


 

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  common stock of $10.00 per share). IonQ Warrants do not represent legally outstanding shares of common stock at closing.

We paid Goldman Sachs & Co. LLC and Needham & Company, LLC, the underwriters in our IPO, an underwriting discount of $0.20 per unit offered or $6.0 million in the aggregate, and agreed to pay them deferred underwriting commissions of $0.35 per unit offered, or $10.5 million in the aggregate, upon the consummation of our initial business combination. These fees were fully earned at the time that the IPO was consummated. In the event that none of our stockholders elect to redeem their shares of Class A Stock in connection with the Business Combination, these fees will be borne by all of our stockholders. However, in the event that the maximum number of our public stockholders choose to redeem their shares of Class A Stock, the aggregate fees, which total $10,500,000, would be borne by the remaining public stockholders, PIPE Investors and IonQ stockholders. By way of example, the deferred underwriting commissions would represent approximately         % of the amounts in our Trust Account (including amounts to be funded into our trust account by PIPE Investors) if none of our public stockholders redeem their shares, or         % of the amounts in our Trust Account (including amounts to be funded into our trust account by PIPE Investors) after giving effect to redemptions if the maximum number of public stockholders redeem their shares.

The Combined Company’s Board of Directors

Following the closing, it is expected that the current CEO of IonQ, Peter Chapman, will become the CEO of the Combined Company, and the Combined Company Board will consist of seven directors, which will be divided among the three classes as follows:

 

   

the Class I directors will be                 ,                  and                 , and their terms will expire at the annual meeting of stockholders to be held in 2022;

 

   

the Class II directors will be                 ,                  and                 , and their terms will expire at the annual meeting of stockholders to be held in 2023; and

 

   

the Class III directors will be                 ,                  and                 , and their terms will expire at the annual meeting of stockholders to be held in 2024.

Our Board’s Reasons for Approval of the Business Combination

We were formed for the purpose of effecting an initial business combination with one or more businesses. We sought to do this by utilizing the networks and industry experience of both the Sponsor and our Board to identify, acquire and operate one or more businesses within or outside of the United States, although we were not limited to a particular industry or sector.

In particular, our Board considered the following positive factors, although not weighted or in any order of significance:

 

   

Industry Leadership Potential of IonQ. Our Board noted that IonQ is poised to become an industry leader in quantum computing. Our Board also noted that IonQ’s technology has significant advantages over existing competitors and has unique advantages that are expected to allow IonQ’s technology to outperform the competition in the future. Our Board noted IonQ’s impressive market position and its technology solutions, which our Board believes position IonQ for future growth and profitability.

 

   

Commercial Viability. Our Board was aware that IonQ’s technology can be potentially revolutionary in various fields, including machine learning, solar energy production, finance, electric vehicles, logistics and drug discovery. Our Board noted IonQ’s impressive technological developments focused on results that will be relevant to commercial applications, which our Board believes provides proof that IonQ is a commercially viable business.


 

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Business and Financial Condition and Prospects. Our Board and our management had knowledge of, and were familiar with, IonQ’s business, financial condition, results of operations and future growth prospects. Our Board considered IonQ’s modest cloud revenue stream, large and rapidly growing total addressable market, capital expenditures and strong leadership position with its track record of innovation. Our Board also discussed IonQ’s current prospects for growth in executing upon and achieving IonQ’s business plan, and noted its unique and innovative technology, its unique market position, opportunities for sustained growth and the opportunity for commercialization of its technology.

 

   

Visionary Management Team. Our Board considered the fact that the Combined Company will be led by Peter Chapman and Jungsang Kim, who have displayed visionary leadership, a strong track record of innovation and who have deep experience in the technology industry.

 

   

Other Alternatives. Our Board believes, after a thorough review of other business combination opportunities reasonably available to dMY, that the proposed Business Combination represents the best potential initial business combination for dMY based upon the process utilized to evaluate and assess other potential acquisition targets. Our Board and our management also believe that such processes had not presented a better alternative.

 

   

Terms of the Merger Agreement. Our Board considered the terms and conditions of the Merger Agreement and the transactions contemplated thereby, including the Business Combination.

 

   

Independent Director Role. Our Board is composed of a majority of independent directors who are not affiliated with the Sponsor and its affiliates. In connection with the Business Combination, our independent directors, Ms. Anderson, Ms. Luthi and Mr. Wert, took an active role in evaluating the proposed terms of the Business Combination, including the Merger Agreement and all Related Agreements and the amendments to the Current Charter to take effect upon the completion of the Business Combination. Our independent directors evaluated and unanimously approved, as members of the Board, the Merger Agreement and the transactions contemplated therein, including the Business Combination.

Our Board also considered a variety of uncertainties and risks and other potentially negative factors concerning the Business Combination, including, but not limited to, the following:

 

   

Benefits Not Achieved. The risk that the potential benefits of the Business Combination may not be fully achieved, or may not be achieved within the expected timeframe.

 

   

Liquidation of dMY. The risks and costs to dMY if the Business Combination is not completed, including the risk of diverting management focus and resources from other initial business combination opportunities, which could result in dMY being unable to effect an initial business combination by November 17, 2022 and force dMY to liquidate and the Public Warrants to expire worthless.

 

   

Exclusivity. The fact that the Merger Agreement includes an exclusivity provision that prohibits dMY from soliciting other initial Transaction Proposals, which restricts our ability to consider other potential initial business combinations prior to the closing or the termination of the Merger Agreement.

 

   

Stockholder Vote. The risk that our stockholders may fail to provide the votes necessary to effect the Business Combination.

 

   

Closing Conditions. The fact that completion of the Business Combination is conditioned on the satisfaction of certain closing conditions that are not within dMY’s control.

 

   

Litigation. The possibility of litigation challenging the Business Combination or that an adverse judgment granting permanent injunctive relief could indefinitely enjoin consummation of the Business Combination.

 

   

Fees and Expenses. The fees and expenses associated with completing the Business Combination.


 

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Other Risks. Various other risks associated with the Business Combination, the business of dMY, the business of IonQ and ownership of the Combined Company’s shares described under the section titled “Risk Factors.”

In addition to considering the factors described above, our Board also considered that:

 

   

Interests of Certain Persons. Some of our officers and directors may have interests in the Business Combinations as individuals that are in addition to, and that may be different from, the interests of our stockholders (see “The Business Combination-Interests of Certain Persons in the Business Combination-Interests of dMY Initial Stockholders and dMY’s Other Current Officers and Directors”). Our independent directors reviewed and considered these interests during the negotiation of the Business Combination and in evaluating and unanimously approving, as members of our Board, the Merger Agreement and the Business Combination.

Our Board concluded that the potential benefits it expected dMY and our stockholders to achieve as a result of the Business Combination outweighed the potentially negative factors associated with the Business Combination. Accordingly, our Board unanimously determined that the Merger Agreement and the transactions contemplated thereby, including the Business Combination, were advisable, fair to, and in the best interests of dMY and our stockholders.

For more information about our Board’s decision-making process concerning the Business Combination, please see the section titled “The Business Combination-Recommendation of dMY’s Board of Directors and Reasons for the Business Combination.”

Independent Director Oversight

Our Board is composed of a majority of independent directors who are not affiliated with the Sponsor and its affiliates. In connection with the Business Combination, our independent directors, Ms. Anderson, Ms. Luthi and Mr. Wert, took an active role in evaluating the proposed terms of the Business Combination, including the Merger Agreement, the Related Agreements and the amendments to the Current Charter to take effect upon the completion of the Business Combination. As part of their evaluation of the Business Combination, our independent directors were aware of the potential conflicts of interest with the Sponsor and its affiliates that could arise with regard to the proposed terms of the Merger Agreement and the Related Agreements. Our Board did not deem it necessary to, and did not form, a special committee of the Board to exclusively evaluate and negotiate the proposed terms of the Business Combination, as our Board is comprised of a majority of independent and disinterested directors and did not deem the formation of a special committee necessary or appropriate. Our independent directors reviewed and considered these interests during the negotiation of the Business Combination and in evaluating and unanimously approving, as members of our Board, the Merger Agreement and the transactions contemplated therein, including the Business Combination. Please see the section titled “The Business Combination—Recommendation of dMY’s Board of Directors and Reasons for the Business Combination.”

Satisfaction of 80% Test

It is a requirement under the Current Charter and NYSE listing requirements that the business or assets acquired in our initial business combination have a fair market value equal to at least 80% of the assets held in the Trust Account (excluding amounts disbursed to management for working capital purposes, if permitted, and the Deferred Discount) at the time of the execution of a definitive agreement for our initial business combination. As of March 7, 2021, the date of the execution of the Merger Agreement, the balance of the Trust Account was approximately $300.0 million (excluding the Deferred Discount and taxes payable on the income earned on the Trust Account) and 80% thereof represents approximately $240 million. In reaching its conclusion that the Business Combination meets the 80% asset test, our Board used, as a fair market value, the enterprise value of


 

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approximately $1.377 billion, which was implied based on the terms of the transactions agreed to by the parties in negotiating the Merger Agreement. The enterprise value consists of an implied equity value of IonQ (prior to the Business Combination) of approximately $1.993 billion and no assumed net debt. In determining whether the enterprise value described above represents the fair market value of IonQ, our Board considered all of the factors described above in this section and the fact that the purchase price for IonQ was the result of an arm’s length negotiation. As a result, our Board concluded that the fair market value of the business acquired was significantly in excess of 80% of the assets held in the Trust Account (excluding any amounts disbursed to management for working capital purposes, if permitted, and the Deferred Discount).

Special Meeting of the Stockholders of dMY

Date, Time and Place of Special Meeting

In light of public health concerns regarding the coronavirus (COVID-19) pandemic, the Special Meeting will be held via live webcast on                 , 2021, at          Eastern time. The Special Meeting can be accessed by visiting https://www.cstproxy.com/dmytechnologyiii/sm2021, where you will be able to listen to the meeting live and vote during the meeting. Additionally, you have the option to listen only to the Special Meeting by dialing 1-888-965-8995 (toll-free within the U.S. and Canada) or +1 415-655-0243 (outside of the U.S. and Canada, standard rates apply). The passcode for telephone access is 28259093#, but please note that you cannot vote or ask questions if you choose to participate telephonically. Please note that you will only be able to access the Special Meeting by means of remote communication.

Proposals

At the Special Meeting, dMY stockholders will be asked to consider and vote on:

 

  1.

Transaction Proposal—A proposal to approve the Merger Agreement, a copy of which is attached to this proxy statement/prospectus as Annex A, and approve the transactions contemplated thereby, including the Business Combination.

 

  2.

NYSE Proposal—A proposal to approve (a) the issuance of 123,808,665 Combined Company common stock in the Business Combination and (b) the issuance and sale of 35,000,000 Combined Company common stock in the PIPE Investment.

 

  3.

Charter Proposal—A proposal to adopt the Proposed Charter in the form attached hereto as Annex B.

 

  4.

Governance Proposals—A proposal to approve, on a non-binding advisory basis, certain governance provisions in the proposed the Proposed Charter, presented separately in accordance with the SEC requirements:

 

  A.

To increase the total number of shares of all classes of authorized capital stock from (i) 401,000,000, consisting of (a) 400,000,000 shares of common stock, including (1) 380,000,000 shares of Class A common stock, par value $0.0001 per share and (2) 20,000,000 shares of Class B common stock, par value $0.0001 per share, and (b) 1,000,000 shares of preferred stock, par value $0.0001 per share, to (ii) 1,020,000,000, consisting of (A) 1,000,000,000 shares of common stock, par value $0.0001 per share, and (B) 20,000,000 shares of preferred stock, par value $0.0001 per share.

 

  B.

To provide that any amendment to amended and restated bylaws will require the approval of either the Combined Company’s board of directors or the holders of at least 6623% of the voting power of the Combined Company’s then-outstanding shares of capital stock entitled to vote generally in an election of directors, voting together as a single class.


 

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  C.

To provide that any amendment to certain provisions of the Proposed Charter will require the approval of the holders of at least 6623% of the voting power of the Combined Company’s then-outstanding shares of capital stock entitled to vote generally in an election of directors, voting together as a single class.

 

  5.

Equity Incentive Plan Proposal—A proposal to approve the 2021 Plan, including the authorization of the initial share reserve under such plan.

 

  6.

Employee Stock Purchase Plan Proposal—A proposal to approve the ESPP, including the authorization of the initial share reserve under such plan.

 

  7.

Adjournment Proposal—A proposal to allow the chairman of the Special Meeting to adjourn the Special Meeting to a later date or dates, if necessary, to permit further solicitation and vote of proxies in the event that there are insufficient votes for, or otherwise in connection with, the approval of the Transaction Proposal, the NYSE Proposal, the Charter Proposal, the Governance Proposals, the Equity Incentive Plan Proposal or the Employee Stock Purchase Plan Proposal.

Voting Power; Record Date

Only dMY stockholders of record at the close of business on             , 2021, the record date for the Special Meeting, will be entitled to vote at the Special Meeting. Each dMY stockholder is entitled to one vote for each share of our Common Stock that such stockholder owned as of the close of business on the record date. If a dMY stockholder’s shares are held in “street name” or are in a margin or similar account, such stockholder should contact its broker, bank or other nominee to ensure that votes related to the shares beneficially owned by such stockholder are properly counted. On the record date, there were 37,500,000 shares of our Common Stock outstanding, of which 30,000,000 are Public Shares and 7,500,000 are Founder Shares held by our Initial Stockholders.

Vote of Our Initial Stockholders

Our Initial Stockholders have agreed to vote any shares of dMY common stock owned by them in favor of the Transaction Proposal. As of the date hereof, our Initial Stockholders own shares equal to 20% of our issued and outstanding shares of common stock.

Quorum and Required Vote for Proposals at the Special Meeting

A majority of the issued and outstanding shares of our common stock entitled to vote as of the record date at the Special Meeting must be present, in person via the virtual meeting platform or represented by proxy, at the Special Meeting to constitute a quorum and in order to conduct business at the Special Meeting. The approval of the Transaction Proposal requires the affirmative vote of a majority of the votes cast by holders of our outstanding shares of common stock represented in person via the virtual meeting platform or by proxy and entitled to vote at the Special Meeting. The approval of the NYSE Proposal requires the affirmative vote of a majority of the votes cast by holders of our outstanding shares of common stock represented in person via the virtual meeting platform or by proxy and entitled to vote at the Special Meeting. The approval of the Charter Proposal requires (i) the affirmative vote of holders of a majority of our outstanding shares of common stock entitled to vote thereon at the Special Meeting and (ii) the affirmative vote of holders of a majority of our outstanding shares of Class B Stock, voting separately as a single class, entitled to vote thereon at the Special Meeting. The approval of the Governance Proposals requires the affirmative vote of a majority of the votes cast by holders of our outstanding shares of common stock represented in person via the virtual meeting platform or by proxy and entitled to vote thereon at the Special Meeting. Approval of the Equity Incentive Plan Proposal and the Employee Stock Purchase Plan Proposal requires the affirmative vote of a majority of the votes cast by holders of our outstanding shares of Common Stock represented in person via the virtual meeting platform or by proxy and entitled to vote at the Special Meeting. Approval of the Adjournment Proposal requires the affirmative vote of a majority of the votes cast by holders of our outstanding shares of common stock represented in person via the virtual meeting platform or by proxy and entitled to vote at the Special Meeting.


 

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Recommendation of our Board of Directors

Our Board believes that each of the Transaction Proposal, the NYSE Proposal, the Charter Proposal, the Governance Proposals, the Equity Incentive Plan Proposal, the Employee Stock Purchase Plan Proposal and the Adjournment Proposal to be presented at the Special Meeting is in the best interests of dMY and its stockholders and unanimously recommends that its stockholders vote “FOR” each of the proposals.

Interests of Certain Persons in the Business Combination

Interests of dMY Initial Stockholders and dMY’s Other Current Officers and Directors

In considering the recommendation of our Board to vote in favor of the Business Combination, our stockholders should be aware that aside from their interests as stockholders, the Sponsor and certain other members of our Board and officers have interests in the Business Combination that are different from, or in addition to, those of other stockholders generally. Our Board was aware of and considered these interests, among other matters, in evaluating and negotiating the Business Combination and in recommending to dMY stockholders that they approve the Business Combination. Stockholders should take these interests into account in deciding whether to approve the Business Combination.

These interests include, among other things:

 

   

the fact that our Initial Stockholders have agreed not to redeem any of the Founder Shares in connection with a stockholder vote to approve a proposed initial business combination;

 

   

the fact that the Sponsor paid an aggregate of approximately $8.0 million for its 4,000,000 Private Warrants to purchase shares of Class A Stock and that such Private Warrants will expire worthless if a business combination is not consummated by November 17, 2022. The Private Warrants would have had an aggregate market value of $                     based upon the closing price of $             per Public Warrant on the NYSE on                     , 2021, the most recent practicable date prior to the date of this proxy statement/prospectus. If the Business Combination is not consummated, our Sponsor will lose any theoretical gain on the shares underlying the Private Warrants;

 

   

the fact that the Sponsor paid an aggregate of $25,000 for the Founder Shares, and upon the completion of the Business Combination, the Founder Shares will convert into Class A common stock at a conversion rate that entitles the Sponsor to own, in the aggregate, [3.65]% of the common stock of the Combined Company after giving effect to the Business Combination. As a result, our Sponsor ultimately expects to receive 7,425,000 shares of common stock of the Combined Company in connection with the conversion of the Founder Shares as part of the Business Combination and such securities will have a significantly higher value at the time of the Business Combination which, if unrestricted and freely tradable, would be valued at approximately $                 , based upon the closing price of $                 per public share on the NYSE on                 , 2021, the most recent practicable date prior to the date of this proxy statement/prospectus, resulting in a theoretical gain of $                 , but, given the lock-up restrictions on such shares, we believe such shares have less value. If the Business Combination is not consummated, our Sponsor will lose any theoretical gain on its shares;

 

   

the fact that each of our independent directors currently holds 25,000 Founder Shares and expects to receive 25,000 shares of common stock of the Combined Company in connection with the conversion of the Founder Shares as part of the Business Combination. The 75,000 shares of common stock of the Combined Company expected to be owned by our independent directors would have had an aggregate market value of $                 based upon the closing price of $                 per public share on the NYSE on             , 2021, the most recent practicable date prior to the date of this proxy statement/prospectus;

 

   

the continued right of the Sponsor to hold Class A Stock and the shares of Class A Stock to be issued to the Sponsor upon exercise of its Private Warrants following the Business Combination, subject to certain lock-up periods;


 

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if the Trust Account is liquidated, including in the event we are unable to complete an initial business combination within the required time period, the Sponsor has agreed to indemnify us to ensure that the proceeds in the Trust Account are not reduced below $10.00 per Public Share, or such lesser per Public Share amount as is in the Trust Account on the liquidation date, by the claims of prospective target businesses with which we have entered into an acquisition agreement or claims of any third party (other than our independent public accountants) for services rendered or products sold to us, but only if such a vendor or target business has not executed a waiver of any and all rights to seek access to the Trust Account;

 

   

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

 

   

the fact that the holders of Founder Shares, Private Warrants and warrants that may be issued upon conversion of certain working capital loans, if any, (and any shares of Class A Stock issuable upon the exercise of the Private Warrants) are entitled to registration rights pursuant to our existing registration rights agreement, to require us to register a sale of any of our securities held by them prior to the consummation of our initial business combination;

 

   

the fact that at the closing of the Business Combination, we will enter into the Registration Rights Agreement with the Registration Rights Holders (in which certain members of our Board and affiliates are included), which provides for registration rights to Registration Rights Holders and their permitted transferees;

 

   

the fact that concurrently with the execution and delivery of the Merger Agreement, we have entered into the Sponsor Support Agreement with the Insiders, the Sponsor and IonQ, pursuant to which the Insiders and the Sponsor have agreed to (i) vote all of their shares (and their permitted transferees will agree to vote all of their shares) of Class A Stock and Class B Stock in favor of the proposals listed herein, representing 20% of the outstanding shares of Class A Stock on an as-converted basis, (ii) not redeem any of the shares of dMY stock owned by such holder in connection with the stockholder approvals contemplated hereby and (iii) certain restrictions on certain of their shares of Class B Stock. Under the Sponsor Support Agreement, the Sponsor and each of the Insiders agrees that, effective upon the consummation of the Business Combination, 10% of the Founder Shares (750,000 shares), which will be converted into shares of Class A Stock at the consummation of the Business Combination, shall be unvested and shall be subject to certain vesting and forfeiture provisions;

 

   

the fact that the Sponsor and its affiliates can earn a positive rate of return on their investment, even if other stockholders experience a negative rate of return in the post-business combination company;

 

   

the fact that the Sponsor, officers and directors will lose their entire investment of approximately $7,525,000 in us and will not be reimbursed for any loans extended, fees or out-of-pocket expenses if an initial business combination is not consummated by November 17, 2022; and

 

   

the fact that the Sponsor and members of our current Board and management would hold the following number of shares in the Combined Company at the consummation of the Business Combination:

 

Name of Person/Entity

   Shares of
Class A
Stock(1)
     Value of
Class A
Stock(3)
 

dMY Sponsor III, LLC (the Sponsor)(2)

     7,425,000      $ 74,250,000  

Harry L. You(2)

     7,425,000      $ 74,250,000  

Niccolo de Masi(2)

         —            —  

Darla Anderson(2)

     25,000      $ 250,000  

Francesca Luthi(2)

     25,000      $ 250,000  

Charles E. Wert(2)

     25,000      $ 250,000  

 

  (1) 

Interests shown consist solely of Founder Shares, classified as Class B Stock. Such shares will automatically convert into Class A Stock concurrently with or immediately following the consummation of the Business Combination on a one-for-one basis, subject to adjustment. Share amounts are subject to the full vesting of the Vesting Shares.


 

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  (2) 

dMY Sponsor III, LLC is the record holder of the shares reported herein. Each of our officers and directors are among the members of dMY Sponsor III, LLC and Mr. You is the manager of dMY Sponsor III, LLC. Mr. You has voting and investment discretion with respect to the common stock held of record by dMY Sponsor III, LLC. Each of our officers and directors other than Mr. You disclaims any beneficial ownership of any shares held by dMY Sponsor III, LLC.

 

  (3) 

Assumes a value of $10.00 per share, the deemed value of the Class A Stock in the Business Combination.

Redemption Rights

Pursuant to the Current Charter, holders of Public Shares may elect to have their shares redeemed for cash at the applicable redemption price per share equal to the quotient obtained by dividing (i) the aggregate amount on deposit in the Trust Account as of two business days prior to the consummation of the Business Combination, including interest not previously released to us to pay our taxes, by (ii) the total number of then-outstanding Public Shares; provided that we will not redeem any shares of Class A Stock issued in the dMY IPO to the extent that such redemption would result in our failure to have net tangible assets (as determined in accordance with Rule 3a51-1(g)(1) of the Exchange Act) in excess of $5,000,001. As of December 31, 2020, the estimated redemption price would have been approximately $10.00 per share. Notwithstanding the foregoing, a holder of the Public Shares, together with any affiliate of his or her or any other person with whom he or she is acting in concert or as a “group” (as defined in Section 13(d)-(3) of the Exchange Act) will be restricted from exercising redemption rights with respect to more than an aggregate of 20% of the shares of Class A Stock included in the units sold in the dMY IPO.

If a holder exercises its redemption rights, then such holder will be exchanging its shares of Class A Stock for cash and will no longer own shares of the Combined Company. Such a holder will be entitled to receive cash for its Public Shares only if it properly demands redemption and delivers its shares (either physically or electronically) to our Transfer Agent in accordance with the procedures described herein. Please see the section titled “Special Meeting of the Stockholders of dMY—Redemption Rights” for the procedures to be followed if you wish to redeem your shares for cash.

Treatment of IonQ Equity Awards

Effective as of the effective time of the Merger, each outstanding unexercised IonQ Stock Option will be assumed by dMY and converted into an option to acquire a number of shares of Class A Stock determined by multiplying the number of shares of IonQ capital stock subject to such option as of immediately prior thereto by the Per Share IonQ Stock Consideration (determined in accordance with the Merger Agreement), rounded down to the nearest whole number of shares, subject to the same terms and conditions as were applicable thereto immediately prior thereto (including applicable vesting conditions and exercisability terms). Each such converted stock option will be exercisable solely for shares of Class A Stock, and the per share exercise price for the stock issuable upon exercise thereof will be determined by dividing the per share exercise price for the shares of IonQ common stock subject to the IonQ Stock Option immediately prior thereto by the Per Share IonQ Stock Consideration, rounded up to the nearest whole cent.

Certain Information Relating to dMY and IonQ

dMY Board and Executive Officers before the Business Combination

The following individuals currently serve as directors and executive officers of dMY:

 

Name

  

Age

    

Position

Niccolo de Masi

     40      Chief Executive Officer and Director

Harry L. You

     61      Chairman

Darla Anderson

     61      Director

Francesca Luthi

     45      Director

Charles E. Wert

     76      Director

 

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IonQ’s Board of Directors and Executive Officers before the Business Combination

 

Name

   Age*     

Position

Executive Officers      

Peter Chapman

     60      President & Chief Executive Officer and Director

Jungsang Kim

     51      Chief Technology Officer and Director

Christopher Monroe

     55      Chief Scientist

Thomas Kramer

     50      Chief Financial Officer

Salle Yoo

     50      Chief Legal Officer & Corporate Secretary
Non-Employee Directors      

Craig Barratt

     58      Director

Blake Byers

     36      Director

Ron Bernal

     65      Director
Key Employee      

David Bacon

     45      Vice President, Software

 

*

As of March 15, 2021.

Combined Company Board and Executive Officers

The following individuals are expected to serve as directors and executive officers of the Combined Company upon consummation of the Business Combination:

 

Name

   Age*     

Position

Executive Officers      

Peter Chapman

     60      President & Chief Executive Officer and Director

Jungsang Kim

     51      Chief Technology Officer and Director

Christopher Monroe

     55      Chief Scientist

Thomas Kramer

     50      Chief Financial Officer

Salle Yoo

     50      Chief Legal Officer & Corporate Secretary
Non-Employee Directors      

Craig Barratt

     58      Chairman of the Board

Blake Byers

     36      Director

Ron Bernal

     65      Director

Niccolo de Masi

     40      Director

Harry You

     61      Director
Key Employee      

David Bacon

     45      Vice President, Software

 

*

As of March 15, 2021.

Listing of Securities

The Public Shares, Public Units and Public Warrants are traded on the NYSE under the ticker symbols “DMYI,” “DMYI-UN” and “DMYI-WT,” respectively. We intend to apply to continue the listing of our common stock and Public Warrants on the NYSE under the symbols “IONQ” and “IONQ WS,” respectively, upon the consummation of the Business Combination.


 

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Comparison of Stockholder Rights

There are certain differences in the rights of dMY stockholders and the Combined Company stockholders prior to the Business Combination and following the closing of the Business Combination. Please see the sections titled “Proposal No. 3—The Charter Proposal” and “Proposal No. 4—The Governance Proposals.”

Regulatory Approvals

Under the HSR Act and the rules that have been promulgated thereunder by the FTC, certain transactions may not be consummated unless information has been furnished to the Antitrust Division and the FTC and certain waiting period requirements have been satisfied. The Business Combination is subject to these requirements and may not be completed until the expiration of a 30-day waiting period following the filing of the required Notification and Report Forms with the Antitrust Division and the FTC or until early termination is granted. If the FTC or the Antitrust Division makes a Second Request, the waiting period with respect to the Business Combination will be extended for an additional period of 30 calendar days, which will begin on the date on which dMY and IonQ each certify compliance with the Second Request. Complying with a Second Request can take a significant period of time. dMY and IonQ have filed the required forms under the HSR Act with the Antitrust Division and the FTC. The 30-day waiting period with respect to the Business Combination, which cannot expire on a Saturday, Sunday or a U.S. federal holiday, is expected to expire at 11:59 p.m. Eastern time on             , 2021 unless the FTC and the Antitrust Division earlier terminate the waiting period or issue a Second Request.

At any time before or after consummation of the Business Combination, notwithstanding termination of the waiting period under the HSR Act, the applicable competition authorities could take such action under applicable antitrust laws as each deems necessary or desirable in the public interest, including seeking to enjoin the consummation of the Business Combination. Private parties may also seek to take legal action under the antitrust laws under certain circumstances. We cannot assure you that the Antitrust Division, the FTC, any state attorney general, or any other government authority will not attempt to challenge the Business Combination on antitrust grounds, and, if such a challenge is made, we cannot assure you as to its result. Neither dMY nor IonQ is aware of any material regulatory approvals or actions that are required for completion of the Business Combination other than the expiration or early termination of the waiting period under the HSR Act. It is presently contemplated that if any such additional regulatory approvals or actions are required, those approvals or actions will be sought. There can be no assurance, however, that any additional approvals or actions will be obtained.

U.S. Federal Income Tax Consequences for Stockholders Exercising Redemption Rights

As described more fully herein, a holder of Class A Stock that exercises its redemption rights to receive cash in exchange for such shares may be treated as selling its Class A Stock in a taxable sale or exchange resulting in the recognition of gain or loss. There may be certain circumstances in which the redemption may be treated as a distribution as an amount equal to the redemption proceeds, for U.S. federal income tax purposes, depending on the amount of our stock that a holder owns or is deemed to own by attribution (including through the ownership of warrants).

Please see the section titled “Material Tax Considerations—U.S. Federal Income Tax Considerations for Stockholders Exercising Redemption Rights” for additional information. You are urged to consult your tax advisors regarding the tax consequences of exercising your redemption rights.

Accounting Treatment of the Business Combination

The Business Combination is intended to be accounted for as a reverse recapitalization in accordance with GAAP. Under this method of accounting, while dMY is the legal acquirer, it will be treated as the “acquired”


 

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company for financial reporting purposes. Accordingly, the Business Combination will be treated as the equivalent of IonQ issuing stock for the net assets of dMY, accompanied by a recapitalization. The net assets of dMY will be stated at historical cost, with no goodwill or other intangible assets recorded. Operations prior to the Business Combination will be those of IonQ.

Appraisal Rights

Appraisal rights or dissenters’ rights are not available to holders of our Common Stock in connection with the Business Combination.

Proxy Solicitation

We are soliciting proxies on behalf of our Board. Proxies may be solicited by mail, via telephone or via e-mail or other electronic correspondence. We have engaged Morrow Sodali to assist in the solicitation of proxies.

If a dMY stockholder grants a proxy, such stockholder may still vote its shares in person via the virtual meeting platform if it revokes its proxy before the Special Meeting. A dMY stockholder may also change its vote by submitting a later-dated proxy, as described in the section titled “Special Meeting of the Stockholders of dMY—Revoking Your Proxy.”

Summary Risk Factors

You should consider all the information contained in this proxy statement/prospectus in deciding how to vote for the proposals presented in the proxy statement/prospectus. The occurrence of one or more of the events or circumstances described in the section titled “Risk Factors,” alone or in combination with other events or circumstances, may harm the Combined Company’s business, financial condition and operating results. Such risks include, but are not limited to:

 

   

IonQ is in its early stages and has a limited operating history, which makes it difficult to forecast its future results of operations.

 

   

IonQ has a history of operating losses and expects to incur significant expenses and continuing losses for the foreseeable future.

 

   

IonQ may not be able to scale its business quickly enough to meet customer and market demand, which could result in lower profitability or cause IonQ to fail to execute on its business strategies.

 

   

IonQ’s estimates of market opportunity and forecasts of market growth may prove to be inaccurate.

 

   

Even if the market in which IonQ competes achieves the forecasted growth, IonQ’s business could fail to grow at similar rates, if at all.

 

   

IonQ has identified a material weakness in its internal control over financial reporting. If IonQ is unable to remediate this material weakness, or if IonQ identifies additional material weaknesses in the future or otherwise fails to maintain an effective system of internal control over financial reporting, this may result in material misstatements of IonQ’s financial statements or cause IonQ to fail to meet its periodic reporting obligations or cause its access to the capital markets to be impaired.

 

   

IonQ has not produced a scalable quantum computer and faces significant barriers in its attempts to produce quantum computers. If IonQ cannot successfully overcome those barriers, its business will be negatively impacted and could fail.

 

   

The quantum computing industry is competitive on a global scale and IonQ may not be successful in competing in this industry or establishing and maintaining confidence in its long-term business prospects among current and future partners and customers.


 

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IonQ’s business is currently dependent upon its relationship with its cloud providers. There are no assurances that IonQ will be able to commercialize quantum computers from its relationships with cloud providers.

 

   

Even if IonQ is successful in developing quantum computing systems and executing its strategy, competitors in the industry may achieve technological breakthroughs which render IonQ’s quantum computing systems obsolete or inferior to other products.

 

   

IonQ’s may be unable to reduce the cost per qubit, which may prevent IonQ from pricing its quantum systems competitively.

 

   

The quantum computing industry is in its early stages and volatile, and if it does not develop, if it develops slower than IonQ expects, if it develops in a manner that does not require use of IonQ’s quantum computing solutions, if it encounters negative publicity or if IonQ’s solution does not drive commercial engagement, the growth of its business will be harmed.

 

   

If IonQ’s computers fail to achieve a broad quantum advantage, its business, financial condition and future prospects may be harmed.

 

   

IonQ could suffer disruptions, outages, defects and other performance and quality problems with its quantum computing systems or with the public cloud and internet infrastructure on which it relies.

 

   

IonQ may face unknown supply chain issues that could delay the introduction of IonQ’s product and negatively impact its business and operating results.

 

   

If IonQ cannot successfully execute on its strategy, including in response to changing customer needs and new technologies and other market requirements, or achieve its objectives in a timely manner, its business, financial condition and results of operations could be harmed.

 

   

IonQ’s products may not achieve market success, but will still require significant costs to develop.

 

   

IonQ is highly dependent on its co-founders, and its ability to attract and retain senior management and other key employees, such as quantum physicists and other key technical employees, is critical to its success. If IonQ fails to retain talented, highly-qualified senior management, engineers and other key employees or attract them when needed, such failure could negatively impact its business.

 

   

IonQ’s future growth and success depend on its ability to sell effectively to large customers.

 

   

IonQ may not be able to accurately estimate the future supply and demand for its quantum computers, which could result in a variety of inefficiencies in its business and hinder its ability to generate revenue. If IonQ fails to accurately predict its manufacturing requirements, it could incur additional costs or experience delays.

 

   

IonQ systems depend on the use of a particular isotope of an atomic element that provides qubits for its ion trap technology. If IonQ is unable to procure these isotopically enriched atomic samples, or is unable to do so on a timely and cost-effective basis, and in sufficient quantities, IonQ may incur significant costs or delays which could negatively affect its operations and business.

 

   

If IonQ’s quantum computing systems may not be compatible with some or all industry-standard software and hardware in the future, its business could be harmed.

 

   

System security and data protection breaches, as well as cyber-attacks, could disrupt IonQ’s operations, which may damage IonQ’s reputation and adversely affect its business.

 

   

State, federal and foreign laws and regulations related to privacy, data use and security could adversely affect IonQ.

 

   

IonQ is subject to U.S. and foreign anti-corruption, anti-bribery and similar laws, and non-compliance with such laws can subject it to criminal or civil liability and harm its business.


 

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IonQ is subject to governmental export and import controls that could impair its ability to compete in international markets due to licensing requirements and subject it to liability if it is not in compliance with applicable laws.

 

   

IonQ’s operating and financial results forecast relies in large part upon assumptions and analyses developed by IonQ. If these assumptions or analyses prove to be incorrect, IonQ’s actual operating results may be materially different from its forecasted results.

 

   

Licensing of intellectual property is of critical importance to IonQ’s business. For example, IonQ licenses patents (some of which are foundational patents) and other intellectual property from the University of Maryland and Duke University on an exclusive basis. If the license agreement with these universities terminates, or if any of the other agreements under which IonQ acquired or licensed, or will acquire or license, material intellectual property rights is terminated, IonQ could lose the ability to develop and operate its business.

 

   

Some of IonQ’s in-licensed intellectual property, including the intellectual property licensed from the University of Maryland and Duke University, has been conceived or developed through government-funded research and thus may be subject to federal regulations providing for certain rights for the U.S. government or imposing certain obligations on IonQ, such as a license to the U.S. government under such intellectual property, “march-in” rights, certain reporting requirements and a preference for U.S.-based companies, and compliance with such regulations may limit IonQ’s exclusive rights and its ability to contract with non-U.S. manufacturers.

 

   

Anti-takeover provisions in the Combined Company’s governing documents could delay or prevent a change of control.

 

   

dMY’s Current Charter provides, and the Combined Company’s Proposed Charter will provide, subject to limited exceptions, that the Court of Chancery will be the sole and exclusive forum for certain stockholder litigation matters, which could limit its stockholders’ ability to obtain a chosen judicial forum for disputes with the Combined Company or its directors, officers, employees or stockholders.

 

   

We may redeem unexpired Public Warrants prior to their exercise at a time that is disadvantageous to warrant holders, thereby making their Public Warrants worthless. Under certain conditions, such redemption could take place if the last reported sales price of Class A Stock equals or exceeds $18.00 or $10.00.

Selected Comparative Per Share Information

Comparative Per Share Data of dMY

The following table sets forth the closing market prices per share of the Public Units, Public Shares and Public Warrants as reported by the NYSE on March 5, 2021, the last trading day before the Business Combination was publicly announced, and on, the last practicable trading day before the date of this proxy statement/prospectus.

 

Trading Date

   Public
Units
(DMYI-UN)
     Public
Shares
(DMYI)
     Public
Warrants
(DMYI-WT)
 

March 5, 2021

   $ 13.10      $ 12.70      $ 3.20  

            , 2021

   $        $        $    

The market prices of our securities could change significantly. Because the consideration payable in the Business Combination pursuant to the Merger Agreement will not be adjusted for changes in the market prices of the Public Shares, the value of the consideration that IonQ Equityholders will receive in the Business Combination may vary significantly from the value implied by the market prices of shares of Public Shares on the date of the Merger Agreement, the date of this proxy statement/prospectus, and the date on which dMY stockholders vote on the approval of the Merger Agreement. dMY stockholders are urged to obtain current market quotations for dMY securities before making their decision with respect to the approval of the Merger Agreement.


 

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Comparative Per Share Data of IonQ

Historical market price information regarding IonQ is not provided because there is no public market for IonQ capital stock.

Market Prices and Dividends

dMY

The Public Units, Public Shares and Public Warrants trade on the NYSE, under the symbols “DMYI-UN,” “DMYI” and “DMYI WS,” respectively. Each Public Unit consists of one Public Share and one-fourth of a Public Warrant. The Public Units began trading on November 13, 2020, and the Public Shares and Public Warrants began trading on January 4, 2021.

On March 5, 2021, the trading date before the public announcement of the Business Combination, the Public Units, Public Shares and Public Warrants closed at $13.10, $12.70 and $3.20, respectively. dMY has not paid any cash dividends on its Public Shares to date and does not intend to pay cash dividends prior to the completion of the Business Combination.

IonQ

Historical market price information regarding shares of IonQ capital stock is not provided because there is no public market for IonQ capital stock. IonQ has not paid any dividends on shares of IonQ capital stock and does not intend to pay dividends prior to the completion of the Business Combination.


 

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CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

Certain statements in this proxy statement/prospectus may constitute “forward-looking statements” for purposes of the federal securities laws. Our forward-looking statements include, but are not limited to, statements regarding our, our management team’s, IonQ’s and IonQ’s management team’s expectations, hopes, beliefs, intentions or strategies regarding the future. In addition, any statements that refer to projections, forecasts or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. The words “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intends,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “will,” “would” and similar expressions may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. Forward-looking statements in this proxy statement/prospectus may include, for example, statements about:

 

   

Our ability to consummate the Business Combination;

 

   

The anticipated timing of the Business Combination;

 

   

The expected benefits of the Business Combination;

 

   

The Combined Company’s financial and business performance following the Business Combination, including financial projections and business metrics;

 

   

Changes in IonQ’s strategy, future operations, financial position, estimated revenues and losses, projected costs, prospects and plans;

 

   

The implementation, market acceptance and success of IonQ’s business model and growth strategy;

 

   

IonQ’s expectations and forecasts with respect to market opportunity and market growth;

 

   

The ability of IonQ’s products and services to meet customers’ compliance and regulatory needs;

 

   

IonQ’s ability to attract and retain qualified employees and management;

 

   

IonQ’s ability to adapt to changes in consumer preferences, perception and spending habits and develop and expand its product offerings and gain market acceptance of its products, including in new geographies;

 

   

IonQ’s ability to develop and maintain its brand and reputation;

 

   

Developments and projections relating to IonQ’s competitors and industry;

 

   

The impact of health epidemics, including the COVID-19 pandemic, on IonQ’s business and the actions IonQ may take in response thereto;

 

   

The impact of the COVID-19 pandemic on customer demands for cloud services;

 

   

IonQ’s expectations regarding its ability to obtain and maintain intellectual property protection and not infringe on the rights of others;

 

   

Expectations regarding the time during which we will be an emerging growth company under the JOBS Act;

 

   

IonQ’s future capital requirements and sources and uses of cash;

 

   

IonQ’s ability to obtain funding for its operations and future growth; and

 

   

IonQ’s business, expansion plans and opportunities.

These forward-looking statements are based on information available as of the date of this proxy statement/prospectus, and current expectations, forecasts and assumptions, and involve a number of judgments, risks and uncertainties. Accordingly, forward-looking statements should not be relied upon as representing our views as of

 

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any subsequent date, and we do not undertake any obligation to update forward-looking statements to reflect events or circumstances after the date they were made, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws.

You should not place undue reliance on these forward-looking statements in deciding how to vote your proxy or instruct how your vote should be cast on the proposals set forth in this proxy statement/prospectus. As a result of a number of known and unknown risks and uncertainties, our actual results or performance may be materially different from those expressed or implied by these forward-looking statements. Some factors that could cause actual results to differ include:

 

   

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

 

   

The outcome of any legal proceedings that may be instituted against dMY following announcement of the proposed Business Combination and transactions contemplated thereby;

 

   

The inability to complete the Business Combination due to the failure to obtain approval of the stockholders of dMY or to satisfy other conditions to the closing in the Business Combination Agreement;

 

   

The ability to obtain or maintain the listing of dMY common stock on NYSE following the Business Combination;

 

   

The risk that the proposed Business Combination disrupts current plans and operations of IonQ as a result of the announcement and consummation of the transactions described herein;

 

   

Our ability to recognize the anticipated benefits of the Business Combination, which may be affected by, among other things, competition and the ability of IonQ to grow and achieve and maintain profitably following the Business Combination;

 

   

Costs related to the Business Combination;

 

   

Changes in applicable laws or regulations;

 

   

The effect of the COVID-19 pandemic on IonQ’s business and the economy in general;

 

   

The ability of IonQ to execute its business model, including market acceptance of its planned products and services;

 

   

The Combined Company’s ability to raise capital;

 

   

The possibility that dMY or IonQ may be negatively impacted by other economic, business, and/or competitive factors;

 

   

Any changes to U.S. tax laws; and

 

   

Other risks and uncertainties described in this proxy statement/prospectus, including those under the section titled “Risk Factors.”

In addition, statements that “dMY believes” or “IonQ believes” and similar statements reflect dMY’s or IonQ’s beliefs and opinions on the relevant subject. These statements are based upon information available to IonQ or dMY, as the case may be, as of the date of this prospectus/proxy statement, and while IonQ or dMY, as the case may be, believes such information forms a reasonable basis for such statements, such information may be limited or incomplete, and such statements should not be read to indicate that such party has conducted an exhaustive inquiry into, or review of, all potentially available relevant information. These statements are inherently uncertain and investors are cautioned not to unduly rely upon these statements.

 

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RISK FACTORS

You should carefully review and consider the following risk factors and the other information contained in this proxy statement/prospectus, including the financial statements and notes to the financial statements included herein, in evaluating the Business Combination and the proposals to be voted on at the Special Meeting. Certain of the following risk factors apply to the business and operations of IonQ and will also apply to the business and operations of the Combined Company following the completion of the Business Combination. The occurrence of one or more of the events or circumstances described in these risk factors, alone or in combination with other events or circumstances, may adversely affect the ability to complete or realize the anticipated benefits of the Business Combination, and may have a material adverse effect on the business, cash flows, financial condition and results of operations of the Combined Company following the Business Combination. The risks discussed below may not prove to be exhaustive and are based on certain assumptions made by dMY and IonQ that later may prove to be incorrect or incomplete. dMY and IonQ may face additional risks and uncertainties that are not presently known to such entity, or that are currently deemed immaterial, which may also impair its business or financial condition. The following discussion should be read in conjunction with the financial statements and notes to the financial statements included herein.

Risks Related to IonQ’s Financial Condition and Status as an Early Stage Company

IonQ is in its early stages and has a limited operating history, which makes it difficult to forecast its future results of operations.

IonQ was founded in 2015 and first offered its Quantum Computer as a Service (“QCaaS”) and professional services related to training on its quantum computing systems in 2020 and 2019, respectively. As a result of its limited operating history, its ability to accurately forecast the future results of operations is limited and subject to a number of uncertainties, including IonQ’s ability to plan for and model future growth. IonQ’s ability to generate revenues will largely be dependent on its ability to develop and produce quantum computers with increasing numbers of algorithmic qubits. As of the date of this registration statement, IonQ has only commercialized a quantum computer with 11 algorithmic qubits. As a result, IonQ’s scalable business model has not been formed and its technical roadmap may not be realized as quickly as hoped, or even at all. The development of IonQ’s scalable business model will likely require the incurrence of a substantially higher level of costs than incurred to date, while IonQ’s revenues will not substantially increase until more powerful, scalable computers are produced, which requires a number of technological advancements which may not occur on the currently anticipated timetable or at all. As a result, IonQ’s historical results should not be considered indicative of its future performance. Further, in future periods, IonQ’s growth could slow or decline for a number of reasons, including but not limited to slowing demand for its QCaaS, increased competition, changes to technology, inability to scale up IonQ’s technology, a decrease in the growth of the overall market, or IonQ’s failure, for any reason, to continue to take advantage of growth opportunities.

IonQ has also encountered, and will continue to encounter, risks and uncertainties frequently experienced by growing companies in rapidly changing industries. If IonQ’s assumptions regarding these risks and uncertainties and its future growth are incorrect or change, or if IonQ does not address these risks successfully, IonQ’s operating and financial results could differ materially from its expectations, and its business could suffer. IonQ’s success as a business ultimately relies upon fundamental research and development breakthroughs in the coming years and decade. There is no certainty these research and development milestones will be achieved as quickly as hoped, or even at all.

IonQ has a history of operating losses and expects to incur significant expenses and continuing losses for the foreseeable future.

IonQ incurred net losses of $15.4 million and $7.3 million for the year ended December 31, 2020 and the three months ended March 31, 2021, respectively. As of March 31, 2021, IonQ had an accumulated deficit of $46.9 million. IonQ believes that it will continue to incur operating and net losses each quarter until at least the time it begins significant production of its quantum computers, which is not expected to occur until 2025, at the earliest, and may occur later, or never. Even with significant production, such production may never become profitable.

 

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IonQ expects the rate at which it will incur losses to be significantly higher in future periods as it, among other things, continues to incur significant expenses in connection with the design, development and manufacturing of its quantum computers; and as it expands its research and development activities; invests in manufacturing capabilities; builds up inventories of components for its quantum computers; increases its sales and marketing activities; develops its distribution infrastructure; and increases its general and administrative functions to support its growing operations and its being a public company. IonQ may find that these efforts are more expensive than it currently anticipates or that these efforts may not result in revenues, which would further increase IonQ’s losses. If IonQ is unable to achieve and/or sustain profitability, or if IonQ is unable to achieve the growth that it expects from these investments, it could have a material effect on IonQ’s business, financial condition or results of operations. IonQ’s business model is unproven and may never allow it to cover its costs.

IonQ may not be able to scale its business quickly enough to meet customer and market demand, which could result in lower profitability or cause IonQ to fail to execute on its business strategies.

In order to grow its business, IonQ will need to continually evolve and scale its business and operations to meet customer and market demand. Quantum computing technology has never been sold at large-scale commercial levels. Evolving and scaling its business and operations places increased demands on IonQ’s management as well as its financial and operational resources to:

 

   

effectively manage organizational change;

 

   

design scalable processes;

 

   

accelerate and/or refocus research and development activities;

 

   

expand manufacturing, supply chain and distribution capacity;

 

   

increase sales and marketing efforts;

 

   

broaden customer-support and services capabilities;

 

   

maintain or increase operational efficiencies;

 

   

scale support operations in a cost-effective manner;

 

   

implement appropriate operational and financial systems;

 

   

and maintain effective financial disclosure controls and procedures.

Commercial production of quantum computers may never occur. IonQ has no experience in producing large quantities of its products and is currently constructing advanced generations of its products. As noted above, there are significant technological and logistical challenges associated with developing, producing, marketing, selling and distributing products in the advanced technology industry, including IonQ’s products, and IonQ may not be able to resolve all of the difficulties that may arise in a timely or cost-effective manner, or at all. IonQ may not be able to cost-effectively manage production at a scale or quality consistent with customer demand in a timely or economical manner.

IonQ’s ability to scale is dependent also upon components it must source from the optical, electronics and semiconductor industries. Shortages or supply interruptions in any of these components will adversely impact IonQ’s ability to deliver revenues.

The stability of ion traps may prove poorer than hoped, or more difficult to manufacture. It may also prove more difficult or even impossible to reliably entangle/connect ion traps together. Both of these factors would adversely impact scalability and costs of the ion trap system.

If commercial production of IonQ’s quantum computers commences, its products may contain defects in design and manufacture that may cause them to not perform as expected or that may require repair, recalls and design

 

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changes. IonQ’s quantum computers are inherently complex and incorporate technology and components that have not been used for other applications and that may contain defects and errors, particularly when first introduced. IonQ has a limited frame of reference from which to evaluate the long-term performance of its products. There can be no assurance that IonQ will be able to detect and fix any defects in its quantum computers prior to the sale to potential consumers. If IonQ’s products fail to perform as expected, customers may delay deliveries, terminate further orders or initiate product recalls, each of which could adversely affect IonQ’s sales and brand and could adversely affect IonQ’s business, prospects and results of operations.

If IonQ cannot evolve and scale its business and operations effectively, it may not be able to execute its business strategies in a cost-effective manner and its business, financial condition, profitability and results of operations could be adversely affected.

IonQ’s estimates of market opportunity and forecasts of market growth may prove to be inaccurate.

Market opportunity estimates and growth forecasts, including those IonQ has generated itself, are subject to significant uncertainty and are based on assumptions and estimates that may not prove to be accurate. The variables that go into the calculation of IonQ’s market opportunity are subject to change over time, and there is no guarantee that any particular number or percentage of companies covered by its market opportunity estimates will purchase its products at all or generate any particular level of revenue for IonQ. In addition, alternatives to quantum computing may present themselves and if they did, could substantially reduce the market for quantum computing services. Any expansion in IonQ’s market depends on a number of factors, including the cost, performance, and perceived value associated with quantum computing solutions.

The methodology and assumptions used to estimate market opportunities may differ materially from the methodologies and assumptions previously used to estimate total addressable market. To estimate the size of IonQ’s market opportunities and their growth rates, IonQ has relied on market reports by leading research and consulting firms. These estimates of total addressable market and growth forecasts are subject to significant uncertainty, are based on assumptions and estimates that may not prove to be accurate and are based on data published by third parties that IonQ has not independently verified. Advances in classical computing may prove more robust for longer than currently anticipated. This could adversely affect the timing of any quantum advantage being achieved, if at all.

Even if the market in which IonQ competes achieves the forecasted growth, IonQ’s business could fail to grow at similar rates, if at all.

IonQ’s success will depend upon its ability to expand, scale its operations, and increase its sales capability. Even if the market in which IonQ competes meets the size estimates and growth forecasted, its business could fail to grow at similar rates, if at all.

IonQ’s growth is dependent upon its ability to successfully scale up manufacturing of its products in sufficient quantity and quality, in a timely or cost-effective manner, or at all. Unforeseen issues associated with scaling up and constructing quantum computing technology at commercially viable levels could negatively impact IonQ’s business, financial condition and results of operations.

IonQ’s growth is dependent upon its ability to successfully market and sell quantum computing technology. IonQ does not have experience with the mass distribution and sale of quantum computing technology. Its growth and long-term success will depend upon the development of its sales and delivery capabilities.

Moreover, because of IonQ’s unique technology, its customers will require particular support and service functions, some of which are not currently available, and may never be available. If IonQ experiences delays in adding such support capacity or servicing its customers efficiently, or experiences unforeseen issues with the reliability of its technology, it could overburden IonQ’s servicing and support capabilities. Similarly, increasing the number of IonQ products and services would require it to rapidly increase the availability of these services. Failure to adequately support and service its customers may inhibit IonQ’s growth and ability to expand.

 

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There is no assurance that IonQ will be able to ramp its business to meet its sales, delivery, manufacturing, installation, servicing and quantum computing targets globally, that its projections on which such targets are based will prove accurate or that the pace of growth or coverage of its customer infrastructure network will meet customer expectations. Failure to grow at rates similar to that of the quantum computing industry may adversely affect IonQ’s operating results and ability to effectively compete within the industry.

IonQ may not manage growth effectively.

IonQ’s failure to manage growth effectively could harm its business, results of operations and financial condition. IonQ anticipates that a period of significant expansion will be required to address potential growth. This expansion will place a significant strain on IonQ’s management, operational and financial resources. Expansion will require significant cash investments and management resources and there is no guarantee that they will generate additional sales of IonQ’s products or services, or that IonQ will be able to avoid cost overruns or be able to hire additional personnel to support them. In addition, IonQ will also need to ensure its compliance with regulatory requirements in various jurisdictions applicable to the sale, installation and servicing of its products. To manage the growth of its operations and personnel, IonQ must establish appropriate and scalable operational and financial systems, procedures and controls and establish and maintain a qualified finance, administrative and operations staff. IonQ may be unable to acquire the necessary capabilities and personnel required to manage growth or to identify, manage and exploit potential strategic relationships and market opportunities.

IonQ has identified a material weakness in its internal control over financial reporting. If IonQ is unable to remediate this material weakness, or if IonQ identifies additional material weaknesses in the future or otherwise fails to maintain an effective system of internal control over financial reporting, this may result in material misstatements of IonQ’s financial statements or cause IonQ to fail to meet its periodic reporting obligations or cause its access to the capital markets to be impaired.

As a public company, IonQ will be required to provide management’s attestation on internal control over financial reporting. Management may not be able to effectively and timely implement controls and procedures that adequately respond to the increased regulatory compliance and reporting requirements that will be applicable after the Business Combination. If IonQ is not able to implement the additional requirements of Section 404(a) of the Sarbanes-Oxley Act in a timely manner or with adequate compliance, it may not be able to assess whether its internal control over financial reporting is effective and may fail to provide timely and accurate financial information to investors. This may subject IonQ to adverse regulatory consequences and could harm investor confidence.

In connection with the preparation and audit of IonQ’s financial statements as of and for the fiscal years ended December 31, 2019 and 2020, a material weakness was identified in its internal control over financial reporting. A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of IonQ’s annual or interim financial statements will not be prevented or detected on a timely basis.

A material weakness was identified in IonQ’s control environment related to its financial statement close process. Specifically,

 

   

IonQ lacks sufficient accounting and financial reporting personnel with requisite knowledge and experience in the application of GAAP and SEC rules to facilitate accurate and timely financial reporting. The limited personnel also contributed to a lack of clearly established authorities and approvals and insufficient segregation of duties.

 

   

IonQ’s financial accounting system has limited functionality and does not facilitate effective information technology general controls relevant to financial reporting. Additionally, elements of IonQ’s close process are managed and processed outside the accounting system, increasing the risk of error.

 

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This material weakness could result in a misstatement of account balances or disclosures that would result in a material misstatement to the annual or interim consolidated financial statements that would not be prevented or detected.

IonQ is implementing measures designed to improve its internal control over financial reporting to remediate this material weaknesses, including the following:

 

   

adding additional qualified accounting personnel, establishing defined policies for approval of transactions and segregating duties among accounting personnel; and

 

   

upgrading the Company’s financial accounting system to one that can support effective information technology general controls as well as the anticipated growth of the business.

These additional resources and policies and procedures are designed to enable IonQ to broaden the scope and quality of its internal review of underlying information related to financial reporting and to formalize and enhance its internal control procedures. With the oversight of senior management, IonQ has begun taking steps and plans to take additional measures to address the underlying causes of the material weakness.

While IonQ is undertaking efforts to remediate this material weakness, the material weakness will not be considered remediated until IonQ’s remediation plan has been fully implemented, the applicable controls operate for a sufficient period of time, and IonQ has concluded, through testing, that the newly implemented and enhanced controls are operating effectively. At this time, IonQ cannot predict the success of such efforts or the outcome of its assessment of the remediation efforts. IonQ can give no assurance that its efforts will remediate this material weakness in its internal control over financial reporting, or that additional material weaknesses will not be identified in the future. IonQ’s failure to implement and maintain effective internal control over financial reporting could result in errors in its consolidated financial statements that could result in a restatement of its financial statements, and could cause it to fail to meet its reporting obligations, any of which could diminish investor confidence in IonQ and cause a decline in the price of its common stock.

IonQ’s independent registered public accounting firm is not required to formally attest to the effectiveness of its internal control over financial reporting until after it is no longer an “emerging growth company,” as defined in the JOBS Act. At such time, IonQ’s independent registered public accounting firm may issue a report that is adverse in the event it is not satisfied with the level at which its internal control over financial reporting is documented, designed or operating.

IonQ may need additional capital to pursue its business objectives and respond to business opportunities, challenges or unforeseen circumstances, and it cannot be sure that additional financing will be available.

IonQ’s business and its future plans for expansion are capital-intensive and the specific timing of cash inflows and outflows may fluctuate substantially from period to period. IonQ’s operating plan may change because of factors currently unknown, and IonQ may need to seek additional funds sooner than planned, through public or private equity or debt financings or other sources, such as strategic collaborations. Such financings may result in dilution to stockholders, issuance of securities with priority as to liquidation and dividend and other rights more favorable than common stock, imposition of debt covenants and repayment obligations or other restrictions that may adversely affect its business. In addition, IonQ may seek additional capital due to favorable market conditions or strategic considerations even if it believes that it has sufficient funds for current or future operating plans. There can be no assurance that financing will be available to IonQ on favorable terms, or at all. The inability to obtain financing when needed may make it more difficult for IonQ to operate its business or implement its growth plans.

IonQ’s ability to use net operating loss carryforwards and other tax attributes may be limited in connection with the business combination or other ownership changes.

IonQ has incurred losses during its history, does not expect to become profitable in the near future and may never achieve profitability. To the extent that IonQ continues to generate taxable losses, unused losses will carry

 

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forward to offset future taxable income, if any, until such unused losses expire, if at all. As of December 31, 2020, IonQ had U.S. federal net operating loss carryforwards of approximately $49.4 million.

Under the Tax Act, as modified by the CARES Act, U.S. federal net operating loss carryforwards generated in taxable periods beginning after December 31, 2017, may be carried forward indefinitely, but the deductibility of such net operating loss carryforwards in taxable years beginning after December 31, 2020, is limited to 80% of taxable income. It is uncertain if and to what extent various states will conform to the Tax Act or the CARES Act.

In addition, IonQ’s net operating loss carryforwards are subject to review and possible adjustment by the IRS, and state tax authorities. Under Sections 382 and 383 of the Code, IonQ’s federal net operating loss carryforwards and other tax attributes may become subject to an annual limitation in the event of certain cumulative changes in the ownership of IonQ. An “ownership change” pursuant to Section 382 of the Code generally occurs if one or more stockholders or groups of stockholders who own at least 5% of a company’s stock increase their ownership by more than 50 percentage points over their lowest ownership percentage within a rolling three-year period. IonQ’s ability to utilize its net operating loss carryforwards and other tax attributes to offset future taxable income or tax liabilities may be limited as a result of ownership changes, including potential changes in connection with the Business Combination or other transactions. Similar rules may apply under state tax laws. IonQ has not yet determined the amount of the cumulative change in its ownership resulting from the Business Combination or other transactions, or any resulting limitations on its ability to utilize its net operating loss carryforwards and other tax attributes. If IonQ earns taxable income, such limitations could result in increased future income tax liability and its future cash flows could be adversely affected. IonQ has recorded a valuation allowance related to its net operating loss carryforwards and other deferred tax assets due to the uncertainty of the ultimate realization of the future benefits of those assets.

Risks Related to IonQ’s Business and Industry

IonQ has not produced a scalable quantum computer and faces significant barriers in its attempts to produce quantum computers. If IonQ cannot successfully overcome those barriers, its business will be negatively impacted and could fail.

Producing quantum computers is a difficult undertaking. There are significant engineering challenges that IonQ must overcome to build its quantum computers. IonQ is still in the development stage and faces significant challenges in completing development of its quantum computers and in producing quantum computers in commercial volumes. Some of the development challenges that could prevent the introduction of IonQ’s quantum computers include, but are not limited to, failure to find scalable ways to flexibly manipulate qubits, failure to transition quantum systems to leverage low-cost, commodity optical technology, and failure to realize multicore quantum computer technology.

Additional development challenges IonQ is facing include:

 

   

Gate fidelity, error correction and miniaturization may not commercialize from the lab and scale as hoped or at all;

 

   

It could prove more challenging and take materially longer than expected to operate parallel gates within a single ion trap and maintain gate fidelity;

 

   

The photonic interconnect between ion traps could prove more challenging and take longer to perfect than currently expected. This would limit IonQ’s ability to scale beyond a single ion trap of approximately 22 logical qubits;

 

   

It could take longer to tune the qubits in a single ion trap, as well as preserve the stability of the qubits within a trap as IonQ seeks to maximize the total number of qubits within one trap;

 

   

The gate speed in IonQ’s technology could prove more difficult to improve than expected; and

 

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The scaling of fidelity with qubit number could prove poorer than expected, limiting IonQ’s ability to achieve larger quantum volume.

In addition, IonQ will need to develop the manufacturing process necessary to make these quantum computers in high volume. IonQ has not yet validated a manufacturing process or acquired the tools or processes necessary to produce high volumes of its quantum computers that meet all commercial requirements. If IonQ is not able to overcome these manufacturing hurdles in building its quantum computers, IonQ’s business is likely to fail.

Even if IonQ completes development and achieves volume production of its quantum computers, if the cost, performance characteristics or other specifications of the quantum computer fall short of IonQ’s projections, IonQ’s business, financial condition and results of operations would be adversely affected.

IonQ’s 32-qubit system, which is an important milestone for IonQ’s technical roadmap and commercialization, is not yet available for customers and may never be available.

IonQ is developing its next-generation 32-qubit quantum computer system, which has not yet been made available to customers. IonQ expects this system to have 22 algorithmic qubits, i.e., qubits that are usable to run quantum algorithms, but the number of algorithmic qubits available in this system has not been finalized and may be fewer than planned. The availability of this generation of quantum computer system for customer use or independent verification by a third party may be materially delayed, or even never occur. Additionally, the future success of IonQ’s technical roadmap will depend upon its ability to approximately double the number of qubits in each subsequent generation of its quantum computer. Accordingly, IonQ’s technical roadmap may be delayed or may never be achieved, either of which would have a material impact on IonQ’s business, financial condition or results of operations.

The quantum computing industry is competitive on a global scale and IonQ may not be successful in competing in this industry or establishing and maintaining confidence in its long-term business prospects among current and future partners and customers.

The markets in which IonQ operates are rapidly evolving and highly competitive. As these markets continue to mature and new technologies and competitors enter such markets, IonQ expects competition to intensify. IonQ’s current competitors include:

 

   

large, well-established tech companies that generally compete in all of IonQ’s markets, including Honeywell, Google, Microsoft, Amazon, Intel and IBM;

 

   

countries such as China, Russia, Canada, Australia and the United Kingdom, and those in the European Union as of the date of this proxy statement/prospectus and we believe additional countries in the future;

 

   

less-established public and private companies with competing technology, including companies located outside the United States; and

 

   

new or emerging entrants seeking to develop competing technologies.

IonQ competes based on various factors, including technology, performance, multi-cloud availability, brand recognition and reputation, customer support and differentiated capabilities, including ease of administration and use, scalability and reliability, data governance and security. Many of IonQ’s competitors have substantially greater brand recognition, customer relationships, and financial, technical and other resources, including an experienced sales force and sophisticated supply chain management. They may be able to respond more effectively than IonQ to new or changing opportunities, technologies, standards, customer requirements and buying practices. In addition, many countries are focused on developing quantum computing solutions either in the private or public sector and may subsidize quantum computers which may make it difficult for IonQ to compete. Many of these competitors do not face the same challenges IonQ does in growing its business. In addition, other competitors might be able to compete with IonQ by bundling their other products in a way that does not allow IonQ to offer a competitive solution.

 

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Additionally, IonQ must be able to achieve its objectives in a timely manner lest quantum computing lose ground to competitors, including competing technologies. Because there are a large number of market participants, including certain sovereign nations, focused on developing quantum computing technology, IonQ must dedicate significant resources to achieving any technical objectives on the timelines established by its management team. Any failure to achieve objectives in a timely manner could adversely affect IonQ’s business, operating results and financial condition.

For all of these reasons, competition may negatively impact IonQ’s ability to maintain and grow consumption of its platform or put downward pressure on its prices and gross margins, any of which could materially harm the reputation, business, results of operations, and financial condition of IonQ.

IonQ’s business is currently dependent upon its relationship with its cloud providers. There are no assurances that IonQ will be able to commercialize quantum computers from its relationships with cloud providers.

Cloud computing partnerships could be terminated, or not scale as anticipated, or even at all. IonQ currently offers its QCaaS on public clouds provided by AWS and Azure. The companies that own both of these public clouds have internal quantum computing efforts that are competitive to IonQ’s technology. Currently, a majority of IonQ’s business is run on the AWS and Azure public cloud. There is risk that one or more of these public cloud providers could use their respective control of their public clouds to embed innovations or privileged interoperating capabilities in competing products, bundle competing products, provide IonQ with unfavorable pricing, leverage their public cloud customer relationships to exclude IonQ from opportunities, and treat IonQ and its customers differently with respect to terms and conditions or regulatory requirements than they would treat their similarly situated customers. Further, they have the resources to acquire or partner with existing and emerging providers of competing technology and thereby accelerate adoption of those competing technologies. All of the foregoing could make it difficult or impossible for IonQ to provide products and services that compete favorably with those of the public cloud providers.

Further, if IonQ’s contractual and other business relationships with its public cloud providers are terminated, either by the counterparty or by IonQ, suspended or suffer a material change to which IonQ is unable to adapt, such as the elimination of services or features on which IonQ depends, IonQ would be unable to provide its QCaaS at the same scale and would experience significant delays and incur additional expense in transitioning customers to a different public cloud provider.

Any material change in IonQ’s contractual and other business relationships with its public cloud providers could result in reduced use of IonQ’s systems, increased expenses, including service credit obligations, and harm to the IonQ brand and reputation, any of which could have a material adverse effect on IonQ’s business, financial condition and results of operations.

Even if IonQ is successful in developing quantum computing systems and executing its strategy, competitors in the industry may achieve technological breakthroughs which render IonQ’s quantum computing systems obsolete or inferior to other products.

IonQ’s continued growth and success depend on its ability to innovate and develop quantum computing technology in a timely manner and effectively market these products. Without timely innovation and development, IonQ’s quantum computing solutions could be rendered obsolete or less competitive by changing customer preferences or because of the introduction of a competitor’s newer technologies. IonQ believes that many competing technologies will require a technological breakthrough in one or more problems related to science, fundamental physics or manufacturing. While it is uncertain whether such technological breakthroughs will occur in the next several years, that does not preclude the possibility that such technological breakthroughs could eventually occur. Any technological breakthroughs which render IonQ’s technology obsolete or inferior to other products could have a material effect on IonQ’s business, financial condition or results of operations.

 

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IonQ’s may be unable to reduce the cost per qubit, which may prevent IonQ from pricing its quantum systems competitively.

IonQ’s projections are dependent on the cost per qubit decreasing over the next several years as its quantum computers advance. These cost projections are based on economies of scale due to demand for IonQ computer systems, technological innovation and negotiations with third-party parts suppliers. If these cost savings do not materialize, the cost per qubit may be higher than projected, making our quantum computing solution less competitive than those produced by our competitors, which could have a material effect on IonQ’s business, financial condition or results of operations.

The quantum computing industry is in its early stages and volatile, and if it does not develop, if it develops slower than IonQ expects, if it develops in a manner that does not require use of IonQ’s quantum computing solutions, if it encounters negative publicity or if IonQ’s solution does not drive commercial engagement, the growth of its business will be harmed.

The nascent market for quantum computers is still rapidly evolving, characterized by rapidly changing technologies, competitive pricing and competitive factors, evolving government regulation and industry standards, and changing customer demands and behaviors. If the market for quantum computers in general does not develop as expected, or develops more slowly than expected, IonQ’s business, prospects, financial condition and operating results could be harmed.

In addition, IonQ’s growth and future demand for its products is highly dependent upon the adoption by developers and customers of quantum computers, as well as on its ability to demonstrate the value of quantum computing to IonQ’s customers. Delays in future generations of IonQ’s quantum computers or technical failures at other quantum computing companies could limit market acceptance of IonQ’s solution. Negative publicity concerning IonQ’s solution or the quantum computing industry as a whole could limit market acceptance of IonQ’s solution. IonQ believes quantum computing will solve many large-scale problems. However, such problems may never be solvable by quantum computing technology. If IonQ’s clients and partners do not perceive the benefits of its solution, or if IonQ’s solution does not drive member engagement, then IonQ’s market may not develop at all, or it may develop slower than IonQ expects. If any of these events occur, it could have a material adverse effect on IonQ’s business, financial condition or results of operations. If progress towards quantum advantage ever slows relative to expectations, it could adversely impact revenues and customer confidence to continue to pay for testing, access and “quantum readiness.” This would harm or even eliminate revenues in the period before quantum advantage.

If IonQ’s computers fail to achieve a broad quantum advantage, its business, financial condition and future prospects may be harmed.

Quantum advantage refers to the moment when a quantum computer can compute faster than traditional computers, while quantum supremacy is achieved once quantum computers are powerful enough to complete calculations that traditional supercomputers can’t perform at all. Broad quantum advantage is when quantum advantage is seen in many applications and developers prefer quantum computers to a traditional computer. No current quantum computers, including the IonQ quantum hardware, have reached a broad quantum advantage, and they may never reach such advantage. Achieving a broad quantum advantage will be critical to the success of any quantum computing company, including IonQ. However, achieving quantum advantage would not necessarily lead to commercial viability of the technology that accomplished such advantage, nor would it mean that such system could outperform classical computers in tasks other than the one used to determine a quantum advantage. Quantum computing technology, including broad quantum advantage, may take decades to be realized, if ever. If IonQ cannot develop quantum computers that have quantum advantage, customers may not continue to purchase IonQ’s products and services. If other companies’ quantum computers reach a broad quantum advantage prior to the time IonQ reaches such capabilities, it could lead to a loss of customers. If any of these events occur, it could have a material adverse effect on IonQ’s business, financial condition or results of operations.

 

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IonQ could suffer disruptions, outages, defects and other performance and quality problems with its quantum computing systems or with the public cloud and internet infrastructure on which it relies.

The IonQ business depends on its quantum computing systems to be available. IonQ has experienced, and may in the future further experience, disruptions, outages, defects and other performance and quality problems with its systems. IonQ has also experienced, and may in the future further experience, disruptions, outages, defects and other performance and quality problems with the public cloud and internet infrastructure on which its systems rely. These problems can be caused by a variety of factors, including failed introductions of new functionality, vulnerabilities and defects in proprietary and open source software, hardware components, human error or misconduct, capacity constraints, design limitations or denial of service attacks or other security-related incidents. IonQ does not have a contractual right with its public cloud providers that compensates it for any losses due to availability interruptions in the public cloud.

Any disruptions, outages, defects and other performance and quality problems with the IonQ quantum computing system or with the public cloud and internet infrastructure on which it relies, could result in reduced use of IonQ’s systems, increased expenses, including service credit obligations, and harm to the IonQ brand and reputation, any of which could have a material adverse effect on IonQ’s business, financial condition and results of operations.

IonQ may face unknown supply chain issues that could delay the introduction of IonQ’s product and negatively impact its business and operating results.

IonQ is reliant on third-party suppliers for components necessary to develop and manufacture its quantum computing solutions. Any of the following factors (and others) could have an adverse impact on the availability of these components:

 

   

IonQ’s inability to enter into agreements with suppliers on commercially reasonable terms, or at all;

 

   

difficulties of suppliers ramping up their supply of materials to meet IonQ’s requirements;

 

   

a significant increase in the price of one or more components, including due to industry consolidation occurring within one or more component supplier markets or as a result of decreased production capacity at manufacturers;

 

   

any reductions or interruption in supply, including disruptions on IonQ’s global supply chain as a result of the COVID-19 pandemic, which IonQ has experienced, and may in the future experience;

 

   

financial problems of either manufacturers or component suppliers;

 

   

significantly increased freight charges, or raw material costs and other expenses associated with IonQ’s business;

 

   

other factors beyond IonQ’s control or which it does not presently anticipate, could also affect its suppliers’ ability to deliver components to IonQ on a timely basis;

 

   

a failure to develop its supply chain management capabilities and recruit and retain qualified professionals;

 

   

a failure to adequately authorize procurement of inventory by IonQ’s contract manufacturers; or

 

   

a failure to appropriately cancel, reschedule, or adjust its requirements based on IonQ’s business needs.

If any of the aforementioned factors were to materialize, it could cause IonQ to halt production of its quantum computing solutions and/or entail higher manufacturing costs, any of which could materially adversely affect IonQ’s business, operating results, and financial condition and could materially damage customer relationships.

 

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If IonQ cannot successfully execute on its strategy, including in response to changing customer needs and new technologies and other market requirements, or achieve its objectives in a timely manner, its business, financial condition and results of operations could be harmed.

The quantum computing market is characterized by rapid technological change, changing user requirements, uncertain product lifecycles and evolving industry standards. IonQ believes that the pace of innovation will continue to accelerate as technology changes and different approaches to quantum computing mature on a broad range of factors, including system architecture, error correction, performance and scale, ease of programming, user experience, markets addressed, types of data processed, and data governance and regulatory compliance. IonQ’s future success depends on its ability to continue to innovate and increase customer adoption of its quantum computer. If IonQ is unable to enhance its quantum computing system to keep pace with these rapidly evolving customer requirements, or if new technologies emerge that are able to deliver competitive products at lower prices, more efficiently, with better functionality, more conveniently, or more securely than the IonQ platform, its business, financial condition and results of operations could be adversely affected.

IonQ’s products may not achieve market success, but will still require significant costs to develop.

IonQ believes that it must continue to dedicate significant resources to its research and development efforts before knowing whether there will be market acceptance of its quantum computing technologies. Furthermore, the technology for IonQ’s products is new, and the performance of these products is uncertain. IonQ’s quantum computing technologies could fail to attain sufficient market acceptance, if at all, for many reasons, including:

 

   

pricing and the perceived value of IonQ’s systems relative to its cost;

 

   

delays in releasing quantum computers with sufficient performance and scale to the market;

 

   

failure to produce products of consistent quality that offer functionality comparable or superior to existing or new products;

 

   

ability to produce products fit for their intended purpose;

 

   

failures to accurately predict market or customer demands;

 

   

defects, errors or failures in the design or performance of IonQ’s quantum computing system;

 

   

negative publicity about the performance or effectiveness of IonQ’s system;

 

   

strategic reaction of companies that market competitive products; and

 

   

the introduction or anticipated introduction of competing technology.

To the extent IonQ is unable to effectively develop and market a quantum computing system to address these challenges and attain market acceptance, its business, operating results and financial condition may be adversely affected.

IonQ is highly dependent on its co-founders, and its ability to attract and retain senior management and other key employees, such as quantum physicists and other key technical employees, is critical to its success. If IonQ fails to retain talented, highly-qualified senior management, engineers and other key employees or attract them when needed, such failure could negatively impact its business.

IonQ’s future success is highly dependent on its ability to attract and retain its executive officers, key employees and other qualified personnel, including its co-founders, Jungsang Kim, IonQ’s Chief Technology Officer, and Christopher Monroe, IonQ’s Chief Scientist. As IonQ builds its brand and becomes more well known, there is increased risk that competitors or other companies may seek to hire IonQ personnel. The loss of the services provided by these individuals will adversely impact the achievement of IonQ’s business strategy. These individuals could leave IonQ’s employment at any time, as they are “at will” employees. A loss of the co-founders, a member of senior management, or an engineer or other key employee particularly to a competitor,

 

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could also place IonQ at a competitive disadvantage. Effective succession planning is also important to IonQ’s long-term success. Failure to ensure effective transfer of knowledge and smooth transitions involving key employees could hinder the company’s strategic planning and execution.

IonQ’s future success also depends on its continuing ability to attract, develop, motivate, and retain highly qualified and skilled employees. The market for highly skilled workers and leaders in the quantum computing industry is extremely competitive. In particular, hiring qualified personnel specializing in supply chain management, engineering and sales, as well as other technical staff and research and development personnel is critical to IonQ’s business and the development of its quantum computing systems. Some of these professionals are hard to find and IonQ may encounter significant competition in its efforts to hire them. Many of the other companies with which IonQ competes for qualified personnel have greater financial and other resources than it does. The effective operation of IonQ’s supply chain, including the acquisition of critical components and materials, the development of its quantum computing technologies, the commercialization of its quantum computing technologies and the effective operation of its managerial and operating systems all depend upon IonQ’s ability to attract, train and retain qualified personnel in the aforementioned specialties. Additionally, changes in immigration and work permit laws and regulations or the administration or interpretation of such laws or regulations could impair IonQ’s ability to attract and retain highly qualified employees. If IonQ cannot attract, train and retain qualified personnel, including its co-founders, in this competitive environment, it may experience delays in the development of its quantum computing technologies and be otherwise unable to develop and grow its business as projected, or even at all.

IonQ’s future growth and success depend on its ability to sell effectively to large customers.

IonQ’s potential customers tend to be large enterprises. Therefore, IonQ’s future success will depend on its ability to effectively sell its products to such large customers. Sales to these end-customers involve risks that may not be present (or that are present to a lesser extent) with sales to smaller customers. These risks include, but are not limited to, (i) increased purchasing power and leverage held by large customers in negotiating contractual arrangements with IonQ and (ii) longer sales cycles and the associated risk that substantial time and resources may be spent on a potential end-customer that elects not to purchase IonQ’s solutions.

Large organizations often undertake a significant evaluation process that results in a lengthy sales cycle. In addition, product purchases by large organizations are frequently subject to budget constraints, multiple approvals and unanticipated administrative, processing and other delays. Finally, large organizations typically have longer implementation cycles, require greater product functionality and scalability, require a broader range of services, demand that vendors take on a larger share of risks, require acceptance provisions that can lead to a delay in revenue recognition and expect greater payment flexibility. All of these factors can add further risk to business conducted with these potential customers.

IonQ may not be able to accurately estimate the future supply and demand for its quantum computers, which could result in a variety of inefficiencies in its business and hinder its ability to generate revenue. If IonQ fails to accurately predict its manufacturing requirements, it could incur additional costs or experience delays.

It is difficult to predict IonQ’s future revenues and appropriately budget for its expenses, and IonQ may have limited insight into trends that may emerge and affect its business. IonQ anticipates being required to provide forecasts of its demand to its current and future suppliers prior to the scheduled delivery of products to potential customers. Currently, there is no historical basis for making judgments on the demand for IonQ’s quantum computers or its ability to develop, manufacture, and deliver quantum computers, or IonQ’s profitability, if any, in the future. If IonQ overestimates its requirements, its suppliers may have excess inventory, which indirectly would increase IonQ’s costs. If IonQ underestimates its requirements, its suppliers may have inadequate inventory, which could interrupt manufacturing of its products and result in delays in shipments and revenues. In addition, lead times for materials and components that IonQ’s suppliers order may vary significantly and depend on factors such as the specific supplier, contract terms and demand for each component at a given time. If IonQ

 

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fails to order sufficient quantities of product components in a timely manner, the delivery of quantum computers and related compute time to its potential customers could be delayed, which would harm IonQ’s business, financial condition and operating results.

IonQ systems depend on the use of a particular isotope of an atomic element that provides qubits for its ion trap technology. If IonQ is unable to procure these isotopically enriched atomic samples, or is unable to do so on a timely and cost-effective basis, and in sufficient quantities, IonQ may incur significant costs or delays which could negatively affect its operations and business.

There are limited suppliers to sources of isotopically enriched materials which may be necessary for the production of IonQ’s ion trap technology. IonQ currently purchases such materials through the National Isotope Development Center managed by the U.S. Department of Energy Isotope Program. IonQ does not have any supplier agreements with the U.S. Department of Energy, and purchases the materials through a standard ordering process. While IonQ is currently looking to engage additional suppliers, there is no guarantee IonQ will be able to establish or maintain relationships with such additional suppliers on terms satisfactory to IonQ. Reliance on any single supplier increases the risks associated with being unable to obtain the necessary atomic samples because the supplier may have laboratory constraints, can be subject to unanticipated shutdowns and/or may be affected by natural disasters and other catastrophic events. Some of these factors may be completely out of IonQ and its suppliers’ control. Failure to acquire sufficient quantities of the necessary isotopically enriched atomic samples in a timely or cost-effective manner could materially harm IonQ’s business.

If IonQ’s quantum computing systems may not be compatible with some or all industry-standard software and hardware in the future, its business could be harmed.

IonQ has focused its efforts on creating quantum computing hardware, the operating system for such hardware and a suite of low-level software programs that optimize execution of quantum algorithms on its hardware. Further up the software stack, IonQ relies on third parties to create higher level quantum programming languages, software development kits (SDKs), and application libraries. Such third-party software and programming is essential to operating IonQ’s quantum computing products and services. IonQ’s quantum computing solutions are designed today to be compatible with most major quantum software development kits, including Qiskit, Cirq, Q# QDK, and OpenQASM, all of which are open source. If a proprietary (not open source) software toolset became the standard for quantum application development in the future by a competitor, usage of IonQ hardware might be limited as a result which would have a negative impact on IonQ. Similarly, if a piece of hardware became a necessary component for quantum computing (for instance, quantum networking) and IonQ cannot integrate with it, the result might have a negative impact on IonQ.

If IonQ’s customers are unable to achieve compatibility between other software and hardware and our hardware, it could impact IonQ’s relationships with such customers or with customers, generally, if the incompatibility is more widespread. In addition, the mere announcement of an incompatibility problem relating to IonQ’s products with higher level software tools could cause IonQ to suffer reputational harm and/or lead to a loss of customers. Any adverse impacts from the incompatibility of IonQ’s quantum computing solutions could adversely affect IonQ’s business, operating results and financial condition.

IonQ may rely heavily on future collaborative partners

IonQ has entered into, and may enter into, strategic partnerships to develop and commercialize IonQ’s current and future research and development programs with other companies to accomplish one or more of the following:

 

   

obtain expertise in relevant markets;

 

   

obtain sales and marketing services or support;

 

   

obtain equipment and facilities;

 

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develop relationships with potential future customers; and

 

   

generate revenue.

IonQ may not be successful in establishing or maintaining suitable partnerships, and IonQ may not be able to negotiate collaboration agreements having terms satisfactory to IonQ, or at all. Failure to make or maintain these arrangements or a delay or failure in a collaborative partner’s performance under any such arrangements could harm its business and financial condition.

System security and data protection breaches, as well as cyber-attacks, could disrupt IonQ’s operations, which may damage IonQ’s reputation and adversely affect its business.

Cyber-attacks, denial-of-service attacks, ransomware attacks, business email compromises, computer malware, viruses, and social engineering (including phishing) are prevalent in the technology industry and IonQ’s customers’ industries. In addition, IonQ may experience attacks, unavailable systems, unauthorized access or disclosure due to employee theft or misuse, denial-of-service attacks, sophisticated nation-state and nation-state supported actors, and advanced persistent threat intrusions. The techniques may be used to sabotage or to obtain unauthorized access to IonQ’s platform, systems, networks, or physical facilities where the IonQ quantum computers are stored, and IonQ may be unable to implement adequate preventative measures or stop security breaches while they are occurring. U.S. law enforcement agencies have indicated to IonQ that quantum computing technology is of particular interest to certain malicious cyber threat actors.

IonQ’s platform is built to be accessed through third-party public cloud providers such as AWS, Azure and the Google Cloud Platform. These providers may also experience breaches and attacks to their products which may impact IonQ’s systems. Data security breaches may also result from non-technical means, such as actions by an employee with access to IonQ’s systems. While IonQ and its third-party cloud providers have implemented security measures designed to protect against security breaches, these measures could fail or may be insufficient, resulting in the unauthorized disclosure, modification, misuse, destruction, or loss of sensitive or confidential information.

Actual or perceived breaches of IonQ’s security measures or the accidental loss, inadvertent disclosure or unapproved dissemination of proprietary information or sensitive or confidential data about IonQ, its partners, its customers or third parties could expose the company and the parties affected to a risk of loss or misuse of this information, resulting in litigation and potential liability, paying damages, regulatory inquiries or actions, damage to the IonQ brand and reputation or other harm to the IonQ business. IonQ’s efforts to prevent and overcome these challenges could increase its expenses and may not be successful. If IonQ fails to detect or remediate a security breach in a timely manner, or a breach otherwise affects a IonQ’s customers, or if IonQ suffers a cyber-attack that impacts its ability to operate its platform, IonQ may suffer material damage to its reputation, business, financial condition and results of operations.

Unfavorable conditions in IonQ’s industry or the global economy, could limit the company’s ability to grow its business and negatively affect its results of operations.

IonQ’s results of operations may vary based on the impact of changes in its industry or the global economy on the company or its customers and potential customers. Negative conditions in the general economy both in the United States and abroad, including conditions resulting from changes in gross domestic product growth, financial and credit market fluctuations, international trade relations, pandemics (such as the COVID-19 pandemic), political turmoil, natural catastrophes, warfare, and terrorist attacks on the United States or elsewhere, could cause a decrease in business investments, including the progress on development of quantum technologies, and negatively affect the growth of IonQ’s business. In addition, in challenging economic times, our current or potential future customers may experience cash flow problems and as a result may modify, delay or cancel plans to purchase our products and services. Additionally, if our customers are not successful in generating sufficient revenue or are unable to secure financing, they may not be able to pay, or may delay

 

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payment of, accounts receivable due to us. Moreover, our key suppliers may reduce their output or become insolvent, thereby adversely impacting our ability to manufacture our products. Furthermore, uncertain economic conditions may make it more difficult for us to raise funds through borrowings or private or public sales of debt or equity securities. IonQ cannot predict the timing, strength or duration of any economic slowdown, instability or recovery, generally or within any particular industry.

Government actions and regulations, such as tariffs and trade protections measures, may limit our ability to obtain products from our suppliers.

Political challenges between the United States and countries in which IonQ’s suppliers are located, including China, and changes to trade policies, including tariff rates and customs duties, trade relations between the United States and China and other macroeconomic issues could adversely impact our business. Specifically, United States-China trade relations remain uncertain. The United States administration has announced tariffs on certain products imported into the United States with China as the country of origin, and China has imposed tariffs in response to the actions of the United States. There is also a possibility of future tariffs, trade protection measures or other restrictions imposed on our products or on our customers by the United States, China or other countries that could have a material adverse effect on our business. IonQ’s technology may be deemed a matter of national security and as such its customer base may be tightly restricted. It may accept government grants that place restrictions on the business’ ability to operate.

IonQ’s operating and financial results forecast relies in large part upon assumptions and analyses developed by the company. If these assumptions or analyses prove to be incorrect, IonQ’s actual operating results may be materially different from its forecasted results.

The projected financial and operating information appearing elsewhere in this proxy statement/prospectus reflect current estimates of future performance, which may never occur. Whether actual operating and financial results and business developments will be consistent with IonQ’s expectations and assumptions as reflected in its forecasts depends on a number of factors, many of which are outside IonQ’s control, including, but not limited to:

 

   

success and timing of development activity;

 

   

customer acceptance of IonQ’s quantum computing systems;

 

   

breakthroughs in classical computing or other computing technologies that could eliminate the advantages of quantum computing systems rendering them less practical to customers;

 

   

competition, including from established and future competitors;

 

   

whether IonQ can obtain sufficient capital to sustain and grow its business;

 

   

IonQ’s ability to manage its growth;

 

   

IonQ’s ability to retain existing key management, integrate recent hires and attract, retain and motivate qualified personnel; and

 

   

the overall strength and stability of domestic and international economies.

Unfavorable changes in any of these or other factors, most of which are beyond IonQ’s control, could materially and adversely affect its business, financial condition and results of operations.

Acquisitions, divestitures, strategic investments and strategic partnerships could disrupt IonQ’s business and harm its financial condition and operating results.

IonQ may pursue growth opportunities by acquiring complementary businesses, solutions or technologies through strategic transactions, investments or partnerships. The identification of suitable acquisition, strategic

 

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investment or strategic partnership candidates can be costly and time consuming and can distract IonQ’s management team from its current operations. If such strategic transactions require IonQ to seek additional debt or equity financing, it may not be able to obtain such financing on terms favorable to IonQ or at all, and such transactions may adversely affect IonQ’s liquidity and capital structure. Any strategic transaction might not strengthen IonQ’s competitive position, may increase some of its risks, and may be viewed negatively by its customers, partners or investors. Even if IonQ successfully completes a strategic transaction, it may not be able to effectively integrate the acquired business, technology, systems, control environment, solutions, personnel or operations into its business. IonQ may experience unexpected changes in how it is required to account for strategic transactions pursuant to U.S. GAAP and may not achieve the anticipated benefits of any strategic transaction. IonQ may incur unexpected costs, claims or liabilities that it incurs during the strategic transaction or that it assumes from the acquired company, or IonQ may discover adverse conditions post acquisition for which it has limited or no recourse.

IonQ has been, and may in the future be, adversely affected by the global COVID-19 pandemic, its various strains or future pandemics.

IonQ faces various risks related to epidemics, pandemics, and other outbreaks, including the recent COVID-19 pandemic, including newly discovered strains of the virus. In response to the COVID-19 pandemic, governments have implemented significant measures, including, but not limited to, business closures, quarantines, travel restrictions, shelter-in-place, stay-at-home and other social distancing directives, intended to control the spread of the virus. Companies have also taken precautions, such as requiring employees to work remotely, imposing travel restrictions and temporarily closing businesses. To the extent that these restrictions remain in place, additional prevention and mitigation measures are implemented in the future, or there is uncertainty about the effectiveness of these or any other measures to contain or treat COVID-19 or future pandemics, there is likely to be an adverse impact on IonQ’s potential customers, our employees and global economic conditions, and consumer confidence and spending, which could materially and adversely affect IonQ’s operations and demand for its products.

The spread of COVID-19 has and may continue to impact IonQ suppliers by disrupting the manufacturing, delivery and the overall supply chain of parts required to manufacture IonQ’s quantum computers. In addition, various aspects of IonQ’s business cannot be conducted remotely, such as the assembly of its quantum computers. These measures by government authorities may remain in place for a significant period of time and they are likely to continue to adversely affect IonQ’s future manufacturing plans, sales and marketing activities, business and results of operations. IonQ may take further actions as may be required by government authorities or that it determines are in the best interests of its employees, suppliers, vendors and business partners.

Due to the fluid nature of the COVID-19 pandemic and uncertainties regarding the related economic impact are likely to result in sustained market turmoil, which could also negatively impact the company’s business, financial condition and cash flows. During 2020, IonQ scaled back its recruiting efforts to control costs and experienced weeklong onsite work stoppages due to quarantining related to the COVID-19 pandemic. The extent of COVID-19’s effect on IonQ’s operational and financial performance will depend on future developments, including the duration, spread and intensity of the pandemic, all of which are uncertain and difficult to predict considering the rapidly evolving landscape. As a result, it is not currently possible to ascertain the overall impact of COVID-19 on IonQ’s business. However, if the pandemic continues to persist as a severe worldwide health crisis, the disease could negatively impact IonQ’s business, financial condition results of operations and cash flows, and may also have the effect of heightening many of the other risks described in this “Risk Factors” section.

Even after the COVID-19 pandemic has subsided, IonQ may continue to experience an adverse impact to its business as a result of COVID-19’s global economic impact, including any recession that has occurred or may occur in the future.

 

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IonQ’s facilities or operations could be damaged or adversely affected as a result of natural disasters and other catastrophic events.

IonQ’s facilities or operations could be adversely affected by events outside of its control, such as natural disasters, and other calamities. IonQ cannot assure you that any backup systems will be adequate to protect it from the effects of fire, floods, typhoons, earthquakes, power loss, telecommunications failures, break-ins, war, riots, terrorist attacks or similar events. Any of the foregoing events may give rise to interruptions, breakdowns, system failures, technology platform failures or internet failures, which could cause the loss or corruption of data or malfunctions of software or hardware as well as adversely affect IonQ’s ability to provide services.

Risks Related to Litigation and Government Regulation

State, federal and foreign laws and regulations related to privacy, data use and security could adversely affect IonQ.

IonQ is subject to state and federal laws and regulations related to privacy, data use and security. In addition, in recent years, there has been a heightened legislative and regulatory focus on data security, including requiring consumer notification in the event of a data breach. Legislation has been introduced in Congress and there have been several Congressional hearings addressing these issues. From time to time, Congress has considered, and may do so again, legislation establishing requirements for data security and response to data breaches that, if implemented, could affect IonQ by increasing its costs of doing business. In addition, several states have enacted privacy or security breach legislation requiring varying levels of consumer notification in the event of a security breach. For example, the California Consumer Privacy Act (“CCPA”), which enhances consumer protection and privacy rights by granting consumers resident in California new rights with respect to the collection of their personal data and imposing new operational requirements on businesses, went into effect in January 2020. The CCPA includes a statutory damages framework and private rights of action against businesses that fail to comply with certain CCPA terms or implement reasonable security procedures and practices to prevent data breaches. Several other states are considering similar legislation. Foreign governments are raising similar privacy and data security concerns. In particular, the European Union enacted a General Data Protection Regulation (“GDPR”). China, Russia, Japan and other countries in Latin America and Asia are also strengthening their privacy laws and the enforcement of privacy and data security requirements. Complying with such laws and regulations may be time-consuming and require additional resources, and could therefore harm IonQ’s business, financial condition and results of operations.

IonQ is subject to U.S. and foreign anti-corruption, anti-bribery and similar laws, and non-compliance with such laws can subject it to criminal or civil liability and harm its business.

IonQ is subject to the U.S. Foreign Corrupt Practices Act of 1977, as amended, the U.S. domestic bribery statute contained in 18 U.S.C. § 201, the U.S. Travel Act, and other anti-bribery, and anti-corruption laws in countries in which it conducts activities. Anti-corruption and anti-bribery laws have been enforced aggressively in recent years and are interpreted broadly to generally prohibit companies, their employees, and their third-party intermediaries from authorizing, promising, offering, providing, soliciting, or accepting, directly or indirectly, improper payments or benefits to or from any person whether in the public or private sector. IonQ may engage with partners and third-party intermediaries to market its services and to obtain necessary permits, licenses, and other regulatory approvals. In addition, IonQ or its third-party intermediaries may have direct or indirect interactions with officials and employees of government agencies or state-owned or affiliated entities. IonQ can be held liable for the corrupt or other illegal activities of these third-party intermediaries, and of its employees, representatives, contractors, partners, and agents, even if IonQ does not explicitly authorize such activities. IonQ cannot provide any assurance that all of its employees and agents will not take actions in violation of its policies and applicable law, for which IonQ may be ultimately held responsible.

Detecting, investigating, and resolving actual or alleged violations of anti-corruption laws can require a significant diversion of time, resources, and attention from senior management. In addition, noncompliance with

 

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anti-corruption or anti-bribery laws could subject IonQ to whistleblower complaints, investigations, sanctions, settlements, prosecution, enforcement actions, fines, damages, other civil or criminal penalties, injunctions, suspension or debarment from contracting with certain persons, reputational harm, adverse media coverage, and other collateral consequences.

IonQ is subject to governmental export and import controls that could impair its ability to compete in international markets due to licensing requirements and subject it to liability if it is not in compliance with applicable laws.

IonQ’s products and technologies are subject to U.S. export control and import laws and regulations, including the U.S. Export Administration Regulations, U.S. Customs regulations, and various economic and trade sanctions regulations administered by the U.S. Treasury Department’s Office of Foreign Assets Controls. U.S. export control and economic sanctions laws include restrictions or prohibitions on the sale or supply of certain products, technologies, and services to U.S. Government embargoed or sanctioned countries, governments, persons and entities. In addition, certain products and technology may be subject to export licensing or approval requirements. Exports of its products and technology must be made in compliance with export control and sanctions laws and regulations. If IonQ fails to comply with these laws and regulations, it and certain of its employees could be subject to substantial civil or criminal penalties, including the possible loss of export or import privileges; fines, which may be imposed on IonQ and responsible employees or managers; and, in extreme cases, the incarceration of responsible employees or managers.

In addition, changes in IonQ’s products or technologies or changes in applicable export or import laws and regulations may create delays in the introduction and sale of its products and technologies in international markets or, in some cases, prevent the export or import of its products and technologies to certain countries, governments or persons altogether. Any change in export or import laws and regulations, shift in the enforcement or scope of existing laws and regulations, or change in the countries, governments, persons or technologies targeted by such laws and regulations, could also result in decreased use of IonQ’s products and technologies, or in its decreased ability to export or sell its products and technologies to existing or potential customers. Any decreased use of IonQ’s products and technologies or limitation on its ability to export or sell its products and technologies would likely adversely affect its business, financial condition and results of operations.

IonQ expects to incur significant costs in complying with these regulations. Regulations related to quantum computing are currently evolving and IonQ faces risks associated with changes to these regulations.

IonQ’s business is exposed to risks associated with litigation, investigations and regulatory proceedings.

IonQ may in the future face legal, administrative and regulatory proceedings, claims, demands and/or investigations involving stockholder, consumer, competition and/or other issues relating to its business on a global basis. Litigation and regulatory proceedings are inherently uncertain, and adverse rulings could occur, including monetary damages, or an injunction stopping IonQ from engaging in certain business practices, or requiring other remedies, such as compulsory licensing of patents. An unfavorable outcome or settlement may result in a material adverse impact on IonQ’s business, results of operations, financial position and overall trends. In addition, regardless of the outcome, litigation can be costly, time-consuming, and disruptive to IonQ’s operations. Any claims or litigation, even if fully indemnified or insured, could damage IonQ’s reputation and make it more difficult to compete effectively or to obtain adequate insurance in the future. In addition, the laws and regulations IonQ’s business is subject to are complex and change frequently. IonQ may be required to incur significant expense to comply with changes in, or remedy violations of, these laws and regulations.

Furthermore, while IonQ maintains insurance for certain potential liabilities, such insurance does not cover all types and amounts of potential liabilities and is subject to various exclusions as well as caps on amounts recoverable. Even if IonQ believes a claim is covered by insurance, insurers may dispute IonQ’s entitlement to recovery for a variety of potential reasons, which may affect the timing and, if the insurers prevail, the amount of IonQ’s recovery.

 

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IonQ may become subject to product liability claims, which could harm its financial condition and liquidity if it is not able to successfully defend or insure against such claims.

IonQ may become subject to product liability claims, even those without merit, which could harm its business prospects, operating results, and financial condition. IonQ may face inherent risk of exposure to claims in the event its quantum computers do not perform as expected or malfunction. A successful product liability claim against IonQ could require IonQ to pay a substantial monetary award. Moreover, a product liability claim could generate substantial negative publicity about IonQ’s quantum computers and business and inhibit or prevent commercialization of other future quantum computers, which would have material adverse effects on IonQ’s brand, business, prospects and operating results. Any insurance coverage might not be sufficient to cover all potential product liability claims. Any lawsuit seeking significant monetary damages either in excess of IonQ’s coverage, or outside of IonQ’s coverage, may have a material adverse effect on IonQ’s reputation, business and financial condition. IonQ may not be able to secure additional product liability insurance coverage on commercially acceptable terms or at reasonable costs when needed, particularly if it does face liability for its products and are forced to make a claim under its policy.

IonQ is subject to requirements relating to environmental and safety regulations and environmental remediation matters which could adversely affect its business, results of operation and reputation.

IonQ is subject to numerous federal, state and local environmental laws and regulations governing, among other things, solid and hazardous waste storage, treatment and disposal, and remediation of releases of hazardous materials. There are significant capital, operating and other costs associated with compliance with these environmental laws and regulations. Environmental laws and regulations may become more stringent in the future, which could increase costs of compliance or require IonQ to manufacture with alternative technologies and materials.

Federal, state and local authorities also regulate a variety of matters, including, but not limited to, health, safety and permitting in addition to the environmental matters discussed above. New legislation and regulations may require IonQ to make material changes to its operations, resulting in significant increases to the cost of production.

IonQ’s manufacturing process will have hazards such as but not limited to hazardous materials, machines with moving parts, and high voltage and/or high current electrical systems typical of large manufacturing equipment and related safety incidents. There may be safety incidents that damage machinery or product, slow or stop production, or harm employees. Consequences may include litigation, regulation, fines, increased insurance premiums, mandates to temporarily halt production, workers’ compensation claims, or other actions that impact the company brand, finances, or ability to operate.

Risks Related to IonQ’s Intellectual Property

Licensing of intellectual property is of critical importance to IonQ’s business. For example, IonQ licenses patents (some of which are foundational patents) and other intellectual property from the University of Maryland and Duke University on an exclusive basis. If the license agreement with these universities terminates, or if any of the other agreements under which IonQ acquired or licensed, or will acquire or license, material intellectual property rights is terminated, IonQ could lose the ability to develop and operate its business.

IonQ is heavily reliant upon licenses to certain patent rights and other intellectual property from third parties that are important or necessary to the development of its products. In particular, IonQ’s quantum computing technology is dependent on its license agreement with University of Maryland and Duke University (the “Universities”). Significant intellectual property developed by IonQ’s co-founders, Jungsang Kim, IonQ’s Chief Technology Officer, and Christopher Monroe, IonQ’s Chief Scientist, has been and is required to be assigned to the Universities as a result of Mr. Kim and Mr. Monroe’s employment by the Universities, and certain such

 

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intellectual property is licensed pursuant to the license agreement with the Universities. Pursuant to the license agreement with the Universities, IonQ was granted an exclusive, worldwide, royalty-free, sublicenseable license for certain patents, know-how (on a non-exclusive basis) and other intellectual property to develop, manufacture and commercialize products for use in certain licensed fields, the scope of which includes the application of the licensed intellectual property in ion trap quantum computing.

IonQ’s existing license agreement with the Universities imposes, and IonQ expects that any future license agreements will impose, upon the company various commercial and development obligations. If IonQ fails to comply with its obligations under these agreements, or it is subject to an insolvency-related event, the licensor may have the right to terminate the these agreements, in which event IonQ would not be able to develop, market or otherwise commercialize products covered by these agreements, including if any of the foregoing were to occur with respect to IonQ’s license agreement with the Universities. IonQ’s business could significantly suffer, for example, if any current or future licenses terminate, if the licensors fail to abide by the terms of the license, if the licensed patents or other rights are found to be invalid or unenforceable, or if IonQ is unable to enter into necessary licenses on acceptable terms.

Licensing of intellectual property is of critical importance to IonQ’s business and involves complex legal, business and scientific issues, and certain provisions in intellectual property license agreements may be susceptible to multiple interpretations. Disputes may arise between IonQ and its licensors regarding intellectual property subject to a license agreement, including:

 

   

the scope of rights granted under the license agreement and other interpretation-related issues;

 

   

whether and the extent to which IonQ’s technology and processes infringe on intellectual property of the licensor that is not subject to the licensing agreement;

 

   

IonQ’s right to sublicense patent and other rights to third parties;

 

   

IonQ’s diligence obligations with respect to the use of the licensed technology in relation to its development and commercialization of its product and technology, and what activities satisfy those diligence obligations;

 

   

the ownership of inventions and know-how resulting from the joint creation or use of intellectual property by IonQ’s licensors and the company;

 

   

IonQ’s right to transfer or assign the license; and

 

   

the effects of termination.

The resolution of any contract interpretation disagreement that may arise could narrow what IonQ believes to be the scope of its rights to the relevant intellectual property or technology, or increase what IonQ believes to be its financial or other obligations under the relevant agreement, either of which could harm its business, financial condition and results of operations. Moreover, if disputes over intellectual property that IonQ has licensed prevent or impair its ability to maintain its current licensing arrangements on acceptable terms, IonQ may be unable to successfully develop and commercialize its products or technology.

While IonQ would expect to exercise all rights and remedies available to it, including seeking to cure any breach by the company, and otherwise seek to preserve its rights under the license agreement, it may not be able to do so in a timely manner, at an acceptable cost or at all. For more information on the license agreement, see the section titled “Information About IonQ—Agreements with the University of Maryland and Duke University.”

 

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If IonQ is unable to obtain and maintain patent protection for its products and technology, or if the scope of the patent protection obtained is not sufficiently broad or robust, its competitors could develop and commercialize products and technology similar or identical to IonQ’s, and its ability to successfully commercialize its product and technology may be adversely affected. Moreover, the secrecy of IonQ’s trade secrets could be compromised, which could cause it to lose the competitive advantage resulting from these trade secrets.

IonQ’s success depends, in significant part, on its ability to obtain, maintain, enforce and defend patents and other intellectual property rights, including trade secrets, with respect to its products and technology and to operate its business without infringing, misappropriating, or otherwise violating the intellectual property rights of others. IonQ may not be able to prevent unauthorized use of its intellectual property. IonQ relies upon a combination of the intellectual property protections afforded by patent, copyright, trademark and trade secret laws in the United States and other jurisdictions, as well as license agreements and other contractual protections, to establish, maintain and enforce rights in its proprietary technologies. In addition, IonQ seeks to protect its intellectual property rights through nondisclosure and invention assignment agreements with its employees and consultants, and through non-disclosure agreements with business partners and other third parties. IonQ’s trade secrets may also be compromised which could cause it to lose the competitive advantage from such trade secrets. Despite IonQ’s efforts to protect its proprietary rights, third parties may attempt to copy or otherwise obtain and use IonQ’s intellectual property. Monitoring unauthorized use of IonQ’s intellectual property is difficult and costly, and the steps IonQ has taken or will take to prevent misappropriation may not be sufficient. Any enforcement efforts IonQ undertakes, including litigation, could be time-consuming and expensive and could divert management’s attention, which could harm its business, results of operations and financial condition. In addition, existing intellectual property laws and contractual remedies may afford less protection than needed to safeguard IonQ’s intellectual property portfolio.

Patent, copyright, trademark and trade secret laws vary significantly throughout the world. A number of foreign countries do not protect intellectual property rights to the same extent as do the laws of the United States. Therefore, IonQ’s intellectual property rights may not be as strong or as easily enforced outside of the United States and efforts to protect against the unauthorized use of IonQ’s intellectual property rights, technology and other proprietary rights may be more expensive and difficult outside of the United States. Failure to adequately protect IonQ’s intellectual property rights could result in its competitors using IonQ’s intellectual property to offer products, potentially resulting in the loss of some of IonQ’s competitive advantage and a decrease in its revenue which, would adversely affect its business, financial condition and operating results.

IonQ’s patent applications may not result in issued patents or its patent rights may be contested, circumvented, invalidated or limited in scope, any of which could have a material adverse effect on IonQ’s ability to prevent others from interfering with its commercialization of its products.

IonQ’s patent applications may not result in issued patents, which may have a material adverse effect on its ability to prevent others from commercially exploiting products similar to IonQ’s. The status of patents involves complex legal and factual questions and the breadth of claims allowed is uncertain. As a result, IonQ cannot be certain that the patent applications that it files will result in patents being issued, or that its patents and any patents that may be issued to IonQ will afford protection against competitors with similar technology. Numerous patents and pending patent applications owned by others exist in the fields in which IonQ has developed and is developing its technology. In addition to those who may have patents or patent applications directed to relevant technology with an effective filing date earlier than any IonQ existing patents or pending patent applications, any of IonQ’s existing or pending patents may also be challenged by others on the basis that they are otherwise invalid or unenforceable. Furthermore, patent applications filed in foreign countries are subject to laws, rules and procedures that differ from those of the United States, and thus IonQ cannot be certain that foreign patent applications related to issued U.S. patents will be issued.

Even if IonQ’s patent applications succeed and it is issued patents in accordance with them, it is still uncertain whether these patents will be contested, circumvented, invalidated or limited in scope in the future. The rights

 

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granted under any issued patents may not provide IonQ with meaningful protection or competitive advantages, and some foreign countries provide significantly less effective patent enforcement than in the United States. In addition, the claims under any patents that issue from IonQ’s patent applications may not be broad enough to prevent others from developing technologies that are similar or that achieve results similar to IonQ’s. The intellectual property rights of others could also bar IonQ from licensing and exploiting any patents that issue from its pending applications. In addition, patents issued to IonQ may be infringed upon or designed around by others and others may obtain patents that it needs to license or design around, either of which would increase costs and may adversely affect its business, prospects, financial condition and operating results.

IonQ may face patent infringement and other intellectual property claims that could be costly to defend, result in injunctions and significant damage awards or other costs (including indemnification of third parties or costly licensing arrangements (if licenses are available at all)) and limit IonQ’s ability to use certain key technologies in the future or require development of non-infringing products, services, or technologies, which could result in a significant expenditure and otherwise harm IonQ’s business.

IonQ may become subject to intellectual property disputes. IonQ’s success depends, in part, on its ability to develop and commercialize its products, services and technologies without infringing, misappropriating or otherwise violating the intellectual property rights of third parties. However, IonQ may not be aware that its products, services or technologies are infringing, misappropriating or otherwise violating third-party intellectual property rights and such third parties may bring claims alleging such infringement, misappropriation or violation. For example, there may be issued patents of which IonQ is unaware, held by third parties that, if found to be valid and enforceable, could be alleged to be infringed by IonQ’s current or future products, services or technologies. There also may be pending patent applications of which IonQ is not aware that may result in issued patents, which could be alleged to be infringed by IonQ’s current or future products, services or technologies. Because patent applications can take years to issue and are often afforded confidentiality for some period of time there may currently be pending applications, unknown to IonQ, that later result in issued patents that could cover IonQ’s current or future products, services or technologies. Lawsuits can be time-consuming and expensive to resolve, and they divert management’s time and attention. Numerous patents and pending patent applications owned by others exist in the fields in which IonQ has developed and is developing its technology. Companies that have developed and are developing technology are often required to defend against litigation claims based on allegations of infringement, misappropriation or other violations of intellectual property rights. IonQ’s products, services or technologies may not be able to withstand any third-party claims against their use. In addition, many companies have the capability to dedicate substantially greater resources to enforce their intellectual property rights and to defend claims that may be brought against them. In a patent infringement claim against IonQ, IonQ may assert, as a defense, that we do not infringe the relevant patent claims, that the patent is invalid or both. The strength of IonQ’s defenses will depend on the patents asserted, the interpretation of these patents, and its ability to invalidate the asserted patents. However, IonQ could be unsuccessful in advancing non-infringement and/or invalidity arguments in its defense. In the United States, issued patents enjoy a presumption of validity, and the party challenging the validity of a patent claim must present clear and convincing evidence of invalidity, which is a high burden of proof. Conversely, the patent owner need only prove infringement by a preponderance of the evidence, which is a lower burden of proof. IonQ’s patent portfolio may not be large enough to deter patent infringement claims, and the IonQ’s competitors and others may now and in the future have significantly larger and more mature patent portfolios. Any litigation may also involve patent holding companies or other adverse patent owners that have no relevant solution revenue, and therefore, IonQ’s patent portfolio may provide little or no deterrence as it would not be able to assert its patents against such entities or individuals. If a third party is able to obtain an injunction preventing us from accessing such third-party intellectual property rights, or if IonQ cannot license or develop alternative technology for any infringing aspect of our business, it may be forced to limit or stop sales of its products, services or technologies or cease business activities related to such intellectual property. Although the company carries general liability insurance, our insurance may not cover potential claims of this type or may not be adequate to indemnify us for all liability that may be imposed. IonQ cannot predict the outcome of lawsuits and cannot ensure that the results of any such actions will not have an adverse effect on its business, financial condition or results of operations. Any intellectual property litigation to which IonQ might

 

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become a party, or for which it is required to provide indemnification, regardless of the merit of the claim or its defenses, may require IonQ to do one or more of the following:

 

   

cease selling or using solutions or services that incorporate the intellectual property rights that allegedly infringe, misappropriate or violate the intellectual property of a third party;

 

   

make substantial payments for legal fees, settlement payments or other costs or damages;

 

   

obtain a license, which may not be available on reasonable terms or at all, to sell or use the relevant technology;

 

   

redesign the allegedly infringing solutions to avoid infringement, misappropriation or violation, which could be costly, time-consuming or impossible; or

 

   

indemnify organizations using IonQ’s platform or third-party service providers.

Even if the claims do not result in litigation or are resolved in IonQ’s favor, these claims, and the time and resources necessary to resolve them, could divert the resources of its management and harm its business and operating results. Moreover, there could be public announcements of the results of hearings, motions or other interim proceedings or developments and if securities analysts or investors perceive these results to be negative, it could have a substantial adverse effect on the price of IonQ’s common stock. The occurrence of infringement claims may grow as the market for our products, services and technologies grows. Accordingly, IonQ’s exposure to damages resulting from infringement claims could increase and this could further exhaust its financial and management resources.

Some of IonQ’s in-licensed intellectual property, including the intellectual property licensed from the University of Maryland and Duke University, has been conceived or developed through government-funded research and thus may be subject to federal regulations providing for certain rights for the U.S. government or imposing certain obligations on IonQ, such as a license to the U.S. government under such intellectual property, “march-in” rights, certain reporting requirements and a preference for U.S.-based companies, and compliance with such regulations may limit IonQ’s exclusive rights and its ability to contract with non-U.S. manufacturers.

Certain intellectual property rights that have been in-licensed pursuant to the license agreement with the University of Maryland and Duke University have been generated through the use of U.S. government funding and are therefore subject to certain federal regulations. As a result, the U.S. government may have certain rights to intellectual property embodied in IonQ’s current or future product candidates pursuant to the Bayh-Dole Act of 1980, or the Patent and Trademark Law Amendment. These U.S. government rights include a non-exclusive, non-transferable, irrevocable worldwide license to use inventions for any governmental purpose. In addition, the U.S. government has the right, under certain limited circumstances, to require the licensor to grant exclusive, partially exclusive or non-exclusive licenses to any of these inventions to a third party if it determines that (1) adequate steps have not been taken to commercialize the invention, (2) government action is necessary to meet public health or safety needs or (3) government action is necessary to meet requirements for public use under federal regulations (also referred to as “march-in rights”). The U.S. government also has the right to take title to these inventions if the licensor fails to disclose the invention to the government or fails to file an application to register the intellectual property within specified time limits. Intellectual property generated under a government funded program is also subject to certain reporting requirements, compliance with which may require IonQ to expend substantial resources. In addition, the U.S. government requires that any products embodying any of these inventions or produced through the use of any of these inventions be manufactured substantially in the United States, and the license agreement with the University of Maryland and Duke University requires that IonQ complies with this requirement. This preference for U.S. industry may be waived by the federal agency that provided the funding if the owner or assignee of the intellectual property can show that reasonable but unsuccessful efforts have been made to grant licenses on similar terms to potential licensees that would be likely to manufacture the products substantially in the United States or that under the circumstances domestic manufacture is not commercially feasible. To the extent any of IonQ’s owned

 

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or licensed future intellectual property is also generated through the use of U.S. government funding, the provisions of the Bayh-Dole Act may similarly apply.

Risks Related to dMY, the Combined Company and the Business Combination

Our Initial Stockholders have agreed to vote in favor of the Business Combination described in this proxy statement/prospectus, regardless of how our public stockholders vote.

Unlike many other blank check companies in which the founders agree to vote their Founder Shares in accordance with the majority of the votes cast by the holders of public stock in connection with an initial business combination, our Initial Stockholders have agreed to vote any shares of Common Stock owned by them in favor of the Transaction Proposal. As of the date hereof, our Initial Stockholders own shares equal to 20% of our issued and outstanding shares of Common Stock. Accordingly, it is more likely that the necessary stockholder approval will be received for the Business Combination than would be the case if our Initial Stockholders agreed to vote any shares of Common Stock owned by them in accordance with the majority of the votes cast by our public stockholders.

The Sponsor, certain members of our Board and our officers have interests in the Business Combination that are different from or are in addition to other stockholders in recommending that stockholders vote in favor of approval of the Transaction Proposal and approval of the other proposals described in this proxy statement/prospectus.

When considering our Board’s recommendation that our stockholders vote in favor of the approval of the Transaction Proposal, our stockholders should be aware that our directors and officers have interests in the Business Combination that may be different from, or in addition to, the interests of our stockholders. These interests include:

 

   

the fact that our Initial Stockholders have agreed not to redeem any of the Founder Shares in connection with a stockholder vote to approve a proposed initial business combination;

 

   

the fact that our Initial Stockholders have agreed to waive their rights to liquidating distributions from the Trust Account with respect to their Founder Shares if we fail to complete an initial business combination by November 17, 2022;

 

   

the fact that the Sponsor paid an aggregate of approximately $8 million for its 4,000,000 Private Warrants to purchase shares of Class A Stock and that such Private Warrants will expire worthless if a business combination is not consummated by November 17, 2022. The Private Warrants would have had an aggregate market value of $         based upon the closing price of $         per Public Warrant on the NYSE on                 , 2021, the most recent practicable date prior to the date of this proxy statement/prospectus. If the Business Combination is not consummated, our Sponsor will lose any theoretical gain on the shares underlying the Private Warrants;

 

   

the fact that the Sponsor paid an aggregate of $25,000 for the Founder Shares, and upon the completion of the Business Combination, the Founder Shares will convert into Class A common stock at a conversion rate that entitles the Sponsor to own, in the aggregate, [3.65]% of the common stock of the Combined Company after giving effect to the Business Combination. As a result, our Sponsor ultimately expects to receive 7,425,000 shares of common stock of the Combined Company in connection with the conversion of the Founder Shares as part of the Business Combination and such securities will have a significantly higher value at the time of the Business Combination which, if unrestricted and freely tradable, would be valued at approximately $        , based upon the closing price of $         per public share on the NYSE on                 , 2021, the most recent practicable date prior to the date of this proxy statement/prospectus, resulting in a theoretical gain of $        , but, given the lock-up restrictions on such shares, we believe such shares have less value. If the Business Combination is not consummated, our Sponsor will lose any theoretical gain on its shares;

 

   

the fact that each of our independent directors currently holds 25,000 Founder Shares and expects to receive 25,000 shares of common stock of the Combined Company in connection with the conversion of the Founder Shares as part of the Business Combination. The 75,000 shares of common stock of the Combined Company expected to be owned by our independent directors would have had an aggregate market value of $         based upon the closing price of $         per public share on the NYSE on                , 2021, the most recent practicable date prior to the date of this proxy statement/prospectus;

 

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the continued right of the Sponsor to hold Class A Stock and the shares of Class A Stock to be issued to the Sponsor upon exercise of its Private Warrants following the Business Combination, subject to certain lock-up periods;

 

   

if the Trust Account is liquidated, including in the event we are unable to complete an initial business combination within the required time period, the Sponsor has agreed to indemnify us to ensure that the proceeds in the Trust Account are not reduced below $10.00 per Public Share, or such lesser per Public Share amount as is in the Trust Account on the liquidation date, by the claims of prospective target businesses with which we have entered into an acquisition agreement or claims of any third party (other than our independent public accountants) for services rendered or products sold to us, but only if such a vendor or target business has not executed a waiver of any and all rights to seek access to the Trust Account;

 

   

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

 

   

the fact that the holders of Founder Shares, Private Warrants and warrants that may be issued upon conversion of certain working capital loans, if any, (and any shares of Class A Stock issuable upon the exercise of the Private Warrants) are entitled to registration rights pursuant to our existing registration rights agreement, to require us to register a sale of any of our securities held by them prior to the consummation of our initial business combination;

 

   

the fact that at the consummation of the Business Combination, we will enter into the Registration Rights Agreement with the Registration Rights Holders (in which certain members of our Board and affiliates are included), which provides for registration rights to Registration Rights Holders and their permitted transferees;

 

   

the fact that concurrently with the execution and delivery of the Merger Agreement, we have entered into the Sponsor Support Agreement with the Insiders, the Sponsor and IonQ, pursuant to which the Insiders and the Sponsor have agreed to (i) vote all of their shares (and their permitted transferees will agree to vote all of their shares) of Class A Stock and Class B Stock in favor of the proposals listed herein, which shares represent 20% of the outstanding shares of Class A Stock on an as-converted basis, (ii) not redeem any of the shares of dMY stock owned by such holder in connection with the stockholder approvals contemplated hereby and (iii) certain restrictions on certain of their shares of Class B Stock. Under the Sponsor Support Agreement, the Sponsor and each of the Insiders agrees that, effective upon the consummation of the Business Combination, 10% of the Founder Shares (750,000 shares), which will be converted into shares of Class A Stock at the consummation of the Business Combination, shall be unvested and shall be subject to certain vesting and forfeiture provisions;

 

   

the fact that the Sponsor and its affiliates can earn a positive rate of return on their investment, even if other stockholders experience a negative rate of return in the post-business combination company;

 

   

the fact that the Sponsor, officers and directors will lose their entire investment of $7,525,00 in us and will not be reimbursed for any loans extended, fees due or out-of-pocket expenses if an initial business combination is not consummated by November 17, 2022; and

 

   

the fact that the Sponsor and members of our current Board and management would hold the following number of shares in the Combined Company at the consummation of the Business Combination:

 

Name of Person/Entity

   Shares of
Class A
Stock(1)
     Value of
Class A Stock(3)
 

dMY Sponsor III, LLC (the Sponsor)(2)

     7,425,000      $ 74,250,000  

Harry L. You(2)

     7,425,000      $ 74,250,000  

Niccolo de Masi(2)

     —          —    

Darla Anderson(2)

     25,000      $ 250,000  

Francesca Luthi(2)

     25,000      $ 250,000  

Charles E. Wert(2)

     25,000      $ 250,000  

 

  (1) 

Interests shown consist solely of Founder Shares, classified as Class B common stock. Such shares will automatically convert into Class A common stock concurrently with or immediately following the consummation of the Business Combination on a one-for-one basis, subject to adjustment. Share amounts are subject to the full vesting of the Vesting Shares.

 

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  (2) 

dMY Sponsor III, LLC is the record holder of the shares reported herein. Each of our officers and directors are among the members of dMY Sponsor III, LLC and Mr. You is the manager of dMY Sponsor III, LLC. Mr. You has voting and investment discretion with respect to the common stock held of record by dMY Sponsor III, LLC. Each of our officers and directors other than Mr. You disclaims any beneficial ownership of any shares held by dMY Sponsor III, LLC.

  (3) 

Assumes a value of $10.00 per share, the deemed value of the Class A Stock in the Business Combination.

The Sponsor, directors or officers or their affiliates may elect to purchase shares from public stockholders, which may influence a vote on a proposed Business Combination and the other proposals described in this proxy statement/prospectus and reduce the public “float” of Class A Stock.

The Sponsor, directors or officers or their affiliates may purchase shares in privately negotiated transactions or in the open market either prior to or following the completion of the Business Combination, although they are under no obligation to do so. Such a purchase may include a contractual acknowledgement that such stockholder, although still the record holder of our shares is no longer the beneficial owner thereof and therefore agrees not to exercise its redemption rights. In the event that the Sponsor, directors, officers or their affiliates purchase shares in privately negotiated transactions from public stockholders who have already elected to exercise their redemption rights, such selling stockholders would be required to revoke their prior elections to redeem their shares. The purpose of such purchases could be to vote such shares in favor of the Business Combination and thereby increase the likelihood of obtaining stockholder approval of the Business Combination or to satisfy closing conditions in the Merger Agreement regarding required amounts in the Trust Account where it appears that such requirements would otherwise not be met. This may result in the completion of the Business Combination that may not otherwise have been possible.

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

Our public stockholders will experience dilution as a consequence of, among other transactions, the issuance of Class A Stock as consideration in the Business Combination. Having a minority share position may reduce the influence that our current stockholders have on the management of the Combined Company.

The issuance of the Class A Stock in the Business Combination will dilute the equity interest of our existing stockholders and may adversely affect prevailing market prices for our Public Shares and/or Public Warrants.

It is anticipated that, upon completion of the Business Combination and based on the assumptions set forth in the below paragraph: (i) our public stockholders will retain an ownership interest of approximately 14.78% in the Combined Company; (ii) our Initial Stockholders will own approximately 3.69% of the Combined Company; (iii) the IonQ Equityholders will own approximately 64.28% of the Combined Company (excluding PIPE Shares acquired by IonQ Equityholders); and (iv) the PIPE Investors will own approximately 17.25% of the Combined Company (excluding any shares acquired in the Merger in consideration for their IonQ capital stock).

The foregoing percentages are calculated exclusive of the Rollover Options and Assumed Warrants, in each case to the extent unvested as of June 7, 2021, include the full amount of the Vesting Shares held by the Initial Stockholders and assume (i) no exercise of redemption rights by our public stockholders; and (ii) no inclusion of any Public Shares issuable upon the exercise of the Warrants. If the actual facts are different than these assumptions, the percentage ownership retained by our existing stockholders in the Combined Company will be different. For more information, please see the sections titled “Summary-Impact of the Business Combination on the Combined Company’s Public Float” and “Unaudited Pro Forma Combined Financial Information.”

 

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We have no operating history and are subject to a mandatory liquidation and subsequent dissolution requirement. As such, there is a risk that we will be unable to continue as a going concern if we do not consummate an initial business combination by November 17, 2022. If we are unable to effect an initial business combination by November 17, 2022, we will be forced to liquidate and our warrants will expire worthless.

We are a blank check company, and as we have no operating history and are subject to a mandatory liquidation and subsequent dissolution requirement, there is a risk that we will be unable to continue as a going concern if we do not consummate an initial business combination by November 17, 2022. Unless we amend the Current Charter to extend the life of dMY and certain other agreements into which we have entered, if we do not complete an initial business combination by November 17, 2022, we will: (i) cease all operations except for the purpose of winding up; (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem the Public Shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account including interest not previously released to us to pay our franchise and income taxes (less up to $100,000 of interest to pay dissolution expenses) divided by the number of then outstanding Public Shares, which redemption will completely extinguish public stockholders’ rights as stockholders (including the right to receive further liquidating distributions, if any), subject to applicable law; and (iii) as promptly as reasonably possible following such redemption, subject to the approval of our remaining stockholders and our Board, dissolve and liquidate, subject in each case to our obligations under the DGCL to provide for claims of creditors and the requirements of other applicable law. In the event of such distribution, it is possible that the per share value of the residual assets remaining available for distribution (including Trust Account assets) will be less than the initial public offering price per Public Unit in the dMY IPO. In addition, if we fail to complete an initial business combination by November 17, 2022, there will be no redemption rights or liquidating distributions with respect to our Public Warrants or the Private Warrants, which will expire worthless. We expect to consummate the Business Combination and do not intend to take any action to extend the life of dMY beyond November 17, 2022 if we are unable to effect an initial business combination by that date.

Even if we consummate the Business Combination, there is no guarantee that the Public Warrants will ever be in the money, and they may expire worthless and the terms of the Public Warrants may be amended.

The exercise price for the Public Warrants is $11.50 per share of Class A Stock. There is no guarantee that the Public Warrants will ever be in the money prior to their expiration, and as such, the Public Warrants may expire worthless.

Our ability to successfully effect the Business Combination and to be successful thereafter will be dependent upon the efforts of our key personnel, including the key personnel of IonQ whom we expect to stay with the Surviving Corporation. The loss of key personnel could negatively impact the operations and profitability of the Combined Company and its financial condition could suffer as a result.

Our ability to successfully effect the Business Combination is dependent upon the efforts of our key personnel, including the key personnel of IonQ. Although some of our key personnel may remain with the Combined Company or the Surviving Corporation, as applicable, in senior management or advisory positions following the Business Combination, it is possible that we will lose some key personnel, the loss of which could negatively impact the operations and profitability of the business of the Combined Company.

IonQ’s success depends to a significant degree upon the continued contributions of senior management, certain of whom would be difficult to replace. Departure by certain of IonQ’s officers could have a material adverse effect on IonQ’s business, financial condition, or operating results. The services of such personnel may not continue to be available to the Surviving Corporation.

We may waive one or more of the conditions to the Business Combination.

We may agree to waive, in whole or in part, one or more of the conditions to our obligations to complete the Business Combination, to the extent permitted by the Current Charter and our current bylaws and applicable

 

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laws. However, if our Board determines that a failure to satisfy the condition is not material, then our Board may elect to waive that condition and close the Business Combination. We may not waive the condition that our stockholders approve the Business Combination. Please see the section titled “The Merger Agreement and Related Agreements—Conditions to Closing” for additional information.

The exercise of discretion by our directors and officers in agreeing to changes to the terms of or waivers of closing conditions in the Merger Agreement may result in a conflict of interest when determining whether such changes to the terms of the Merger Agreement or waivers of conditions are appropriate and in the best interests of our stockholders.

In the period leading up to the consummation of the Business Combination, other events may occur that, pursuant to the Merger Agreement, would require us to agree to amend the Merger Agreement, to consent to certain actions or to waive rights that we are entitled to under those agreements. Such events could arise because of changes in the course of IonQ’s business, a request by IonQ to undertake actions that would otherwise be prohibited by the terms of the Merger Agreement or the occurrence of other events that would have a material adverse effect on IonQ’s business and would entitle us to terminate the Merger Agreement. In any of such circumstances, it would be in our discretion, acting through our Board, to grant our consent or waive our rights. The existence of the financial and personal interests of the directors described elsewhere in this proxy statement/prospectus may result in a conflict of interest on the part of one or more of the directors between what he or she may believe is best for dMY and our stockholders and what he or she may believe is best for himself or herself or his or her affiliates in determining whether or not to take the requested action. As of the date of this proxy statement/prospectus, we do not believe there will be any changes or waivers that our directors and officers would be likely to make after stockholder approval of the Business Combination has been obtained. While certain changes could be made without further stockholder approval, if there is a change to the terms of the Business Combination that would have a material impact on the stockholders, we will be required to circulate a new or amended proxy statement/prospectus or supplement thereto and resolicit the vote of our stockholders with respect to the Transaction Proposal.

We and IonQ will incur significant transaction and transition costs in connection with the Business Combination.

We and IonQ have both incurred and expect to incur significant, non-recurring costs in connection with consummating the Business Combination and operating as a public company following the consummation of the Business Combination. We and IonQ may also incur additional costs to retain key employees. All expenses incurred in connection with the Merger Agreement and the transactions contemplated thereby (including the Business Combination), including all legal, accounting, consulting, investment banking and other fees, expenses and costs, will be for the account of the party incurring such fees, expenses and costs or paid by us following the consummation of the Business Combination.

Our transaction expenses as a result of the Business Combination are currently estimated at approximately $50 million, including a Deferred Discount. The amount of the Deferred Discount will not be adjusted for any shares that are redeemed in connection with an initial business combination. The per-share amount we will distribute to stockholders who properly exercise their redemption rights will not be reduced by the Deferred Discount and after such redemptions, the per-share value of shares held by non-redeeming stockholders will reflect our obligation to pay the Deferred Discount.

If we are unable to complete an initial business combination, our public stockholders may receive only approximately $10.00 per share on the liquidation of the Trust Account (or less than $10.00 per share in certain circumstances where a third party brings a claim against us that the Sponsor is unable to indemnify), and our warrants will expire worthless.

If we are unable to complete an initial business combination by November 17, 2022, our public stockholders may receive only approximately $10.00 per share on the liquidation of the Trust Account (or less than $10.00 per

 

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share in certain circumstances where a third-party brings a claim against us that the Sponsor is unable to indemnify (as described herein)) and our warrants will expire worthless.

If third parties bring claims against us, the proceeds held in the Trust Account could be reduced and the per-share redemption amount received by stockholders may be less than $10.00 per share.

Our placing of funds in the Trust Account may not protect those funds from third-party claims against us. Although we will seek to have all vendors, service providers (other than our independent auditors), prospective target businesses or other entities with which we do business execute agreements with us waiving any right, title, interest or claim of any kind in or to any funds held in the Trust Account for the benefit of our public stockholders, such parties may not execute such agreements, or even if they execute such agreements they may not be prevented from bringing claims against the Trust Account, including, but not limited to, fraudulent inducement, breach of fiduciary responsibility or other similar claims, as well as claims challenging the enforceability of the waiver, in each case in order to gain advantage with respect to a claim against our assets, including the funds held in the Trust Account. If any third party refuses to execute an agreement waiving such claims to the funds held in the Trust Account, our management will perform an analysis of the alternatives available to it and will only enter into an agreement with a third-party that has not executed a waiver if management believes that such third party’s engagement would be significantly more beneficial to us than any alternative.

Examples of possible instances where we may engage a third party that refuses to execute a waiver include the engagement of a third party consultant whose particular expertise or skills are believed by management to be significantly superior to those of other consultants that would agree to execute a waiver or in cases where management is unable to find a service provider willing to execute a waiver. In addition, there is no guarantee that such entities will agree to waive any claims they may have in the future as a result of, or arising out of, any negotiations, contracts or agreements with us and will not seek recourse against the Trust Account for any reason. Upon redemption of our Public Shares, if we are unable to complete our initial business combination within the prescribed timeframe, or upon the exercise of a redemption right in connection with our initial business combination, we will be required to provide for payment of claims of creditors that were not waived that may be brought against us within the ten years following redemption. Accordingly, the per-share redemption amount received by public stockholders could be less than the $10.00 per share initially held in the Trust Account, due to claims of such creditors.

The Sponsor has agreed that it will be liable to us if and to the extent any claims by a third party for services rendered or products sold to us, or a prospective target business with which we have entered into a transaction agreement, reduce the amount of funds in the Trust Account to below (i) $10.00 per Public Share or (ii) such lesser amount per Public Share held in the Trust Account as of the date of the liquidation of the Trust Account due to reductions in the value of the trust assets, in each case net of the interest which may be withdrawn to pay taxes, except as to any claims by a third party who executed a waiver of any and all rights to seek access to the Trust Account and except as to any claims under indemnity of the underwriter of the dMY IPO against certain liabilities, including liabilities under the Securities Act.

Moreover, in the event that an executed waiver is deemed to be unenforceable against a third party, the Sponsor will not be responsible to the extent of any liability for such third-party claims. We have not independently verified whether the Sponsor has sufficient funds to satisfy its indemnity obligations and believe that the Sponsor’s only assets are securities of dMY. We have not asked the Sponsor to reserve for such indemnification obligations. Therefore, we cannot assure you that the Sponsor would be able to satisfy those obligations. As a result, if any such claims were successfully made against the Trust Account, the funds available for the Business Combination and redemptions could be reduced to less than $10.00 per Public Share. In such event, we may not be able to complete the Business Combination, and you would receive such lesser amount per share in connection with any redemption of your Public Shares. None of our officers will indemnify us for claims by third parties including, without limitation, claims by vendors and prospective target businesses.

 

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Our directors may decide not to enforce the indemnification obligations of the Sponsor, resulting in a reduction in the amount of funds in the Trust Account available for distribution to our public stockholders.

In the event that the proceeds in the Trust Account are reduced below the lesser of (i) $10.00 per Public Share or (ii) other than due to the failure to obtain a waiver to seek access to the Trust Account, such lesser amount per share held in the Trust Account as of the date of the liquidation of the Trust Account due to reductions in the value of the trust assets, in each case net of the interest which may be withdrawn to pay our tax obligations, and the Sponsor asserts that it is unable to satisfy its obligations or that it has no indemnification obligations related to a particular claim, our independent directors would determine whether to take legal action against the Sponsor to enforce its indemnification obligations. While we currently expect that our independent directors would take legal action on our behalf against the Sponsor to enforce its indemnification obligations to us, it is possible that our independent directors, in exercising their business judgment, may choose not to do so if, for example, the cost of such legal action is deemed by the independent directors to be too high relative to the amount recoverable or if the independent directors determine a favorable outcome is unlikely. If our independent directors choose not to enforce these indemnification obligations, the amount of funds in the Trust Account available for distribution to our public stockholders may be reduced below $10.00 per share.

If, before distributing the proceeds in the Trust Account to our public stockholders, we file a bankruptcy petition or an involuntary bankruptcy petition is filed against us that is not dismissed, the claims of creditors in such proceeding may have priority over the claims of our stockholders and the per-share amount that would otherwise be received by our stockholders in connection with our liquidation may be reduced.

If, before distributing the proceeds in the Trust Account to our public stockholders, we file a bankruptcy petition or an involuntary bankruptcy petition is filed against us that is not dismissed, the proceeds held in the Trust Account could be subject to applicable bankruptcy law, and may be included in our bankruptcy estate and subject to the claims of third parties with priority over the claims of our stockholders. To the extent any bankruptcy claims deplete the Trust Account, the per-share amount that would otherwise be received by our stockholders in connection with our liquidation may be reduced.

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

Although we have conducted due diligence on IonQ, we cannot assure you that this diligence will surface all material issues that may be present in IonQ’s business, that it would be possible to uncover all material issues through a customary amount of due diligence, or that factors outside of IonQ’s business and outside of our and IonQ’s control will not later arise. As a result of these factors, we may be forced to later write down or write off assets, restructure operations, or incur impairment or other charges that could result in losses. Even if our due diligence successfully identifies certain risks, unexpected risks may arise and previously known risks may materialize in a manner not consistent with our preliminary risk analysis. Even though these charges may be non-cash items and not have an immediate impact on our liquidity, the fact that we report charges of this nature could contribute to negative market perceptions about the Combined Company or its securities. Accordingly, any of our stockholders who choose to remain stockholders following the Business Combination could suffer a reduction in the value of their shares. Such stockholders are unlikely to have a remedy for such reduction in value.

We have no operating or financial history and our results of operations and those of the Combined Company may differ significantly from the unaudited pro forma financial data included in this proxy statement/prospectus.

We are a blank check company and we have no operating history and no revenues. This proxy statement/prospectus includes unaudited pro forma combined financial statements for the Combined Company. The unaudited pro forma combined statement of operations of the Combined Company combines our historical

 

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audited results of operations for the period from September 14, 2020 (inception) through December 31, 2020 with the historical audited results of operations of IonQ for the year ended December 31, 2020, respectively, and gives pro forma effect to the Business Combination as if it had been consummated on January 1, 2020, the beginning of the earliest period presented. The unaudited pro forma combined statement of operations for the three months ended March 31, 2021 combines the historical statement of operations of dMY for the three months ended March 31, 2021 and the historical statement of operations of IonQ for the three months ended March 31, 2021, giving effect to the Business Combination as if it had been consummated on January 1, 2020, the beginning of the earliest period presented. The unaudited pro forma combined balance sheet of the Combined Company combines our historical balance sheet as of March 31, 2021 and the historical balance sheet of IonQ as of March 31 2021 and gives pro forma effect to the Business Combination as if it had been consummated on March 31, 2021.

The unaudited pro forma combined financial statements are presented for illustrative purposes only, are based on certain assumptions, address a hypothetical situation and reflect limited historical financial data. Therefore, the unaudited pro forma combined financial statements are not necessarily indicative of the results of operations and financial position that would have been achieved had the Business Combination and the acquisitions by IonQ been consummated on the dates indicated above, or the future consolidated results of operations or financial position of the Combined Company. Accordingly, the Combined Company’s business, assets, cash flows, results of operations and financial condition may differ significantly from those indicated by the unaudited pro forma combined financial statements included in this document. For more information, please see the section titled “Unaudited Pro Forma Combined Financial Information.”

Unanticipated changes in effective tax rates or adverse outcomes resulting from examination of our income or other tax returns could adversely affect our financial condition and results of operations.

We will be subject to income taxes in the United States and other jurisdictions, and our tax liabilities will be subject to the allocation of expenses in differing jurisdictions. Our future effective tax rates could be subject to volatility or adversely affected by a number of factors, including:

 

   

changes in the valuation of our deferred tax assets and liabilities;

 

   

expected timing and amount of the release of any tax valuation allowances;

 

   

tax effects of stock-based compensation;

 

   

costs related to intercompany restructurings;

 

   

changes in tax laws, regulations or interpretations thereof; or

 

   

lower than anticipated future earnings in jurisdictions where we have lower statutory tax rates and higher than anticipated future earnings in jurisdictions where we have higher statutory tax rates.

In addition, we may be subject to audits of our income, sales and other transaction taxes by taxing authorities. Outcomes from these audits could have an adverse effect on our financial condition and results of operations.

A market for our securities may not continue, which would adversely affect the liquidity and price of our securities.

Following the Business Combination, the price of our securities may fluctuate significantly due to the market’s reaction to the Business Combination and general market and economic conditions. An active trading market for our securities following the Business Combination may never develop or, if developed, it may not be sustained. In addition, the price of our securities following the consummation of the Business Combination can vary due to general economic conditions and forecasts, our general business condition and the release of our financial reports. Additionally, if our securities are not listed on, or become delisted from, NYSE for any reason, and are quoted on the OTC Bulletin Board, an inter-dealer automated quotation system for equity securities that is not a national securities exchange, the liquidity and price of our securities may be more limited than if we were quoted

 

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or listed on NYSE or another national securities exchange. You may be unable to sell your securities unless a market can be established or sustained.

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

If the benefits of the Business Combination do not meet the expectations of investors or securities analysts, the market price of our securities prior to the consummation of the Business Combination may decline. The market values of our securities at the time of the Business Combination may vary significantly from their prices on the date the Merger Agreement was executed, the date of this proxy statement/prospectus, or the date on which our stockholders vote on the Business Combination.

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

Factors affecting the trading price of the Combined Company’s securities following the Business Combination may include:

 

   

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

 

   

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

 

   

the public’s reaction to our press releases, our other public announcements and our filings with the SEC;

 

   

speculation in the press or investment community;

 

   

success of competitors;

 

   

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

 

   

changes in financial estimates and recommendations by securities analysts concerning the Combined Company or the market in general;

 

   

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

 

   

our ability to market new and enhanced products on a timely basis;

 

   

changes in laws and regulations affecting our business;

 

   

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

 

   

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

 

   

the volume of shares of Class A Stock available for public sale;

 

   

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

 

   

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

 

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the realization of any of the risk factors presented in this proxy statement/prospectus;

 

   

additions or departures of key personnel;

 

   

failure to comply with the requirements of NYSE;

 

   

failure to comply with the Sarbanes-Oxley Act or other laws or regulations;

 

   

actual, potential or perceived control, accounting or reporting problems;

 

   

changes in accounting principles, policies and guidelines; and

 

   

general economic and political conditions such as recessions, interest rates, fuel prices, international currency fluctuations and health epidemics and pandemics (including the ongoing COVID-19 public health emergency), acts of war or terrorism.

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

In the past, securities class action litigation has often been initiated against companies following periods of volatility in their stock price. This type of litigation could result in substantial costs and divert our management’s attention and resources, and could also require us to make substantial payments to satisfy judgments or to settle litigation.

Past performance by dMY Sponsor III, LLC and by our management team may not be indicative of future performance of an investment in dMY or the Combined Company.

Past performance by dMY Sponsor III, LLC and by our management team is not a guarantee of success with respect to the Business Combination. You should not rely on the historical record of dMY Sponsor III, LLC or our management team’s performance as indicative of the future performance of an investment in dMY or the Combined Company or the returns dMY or the Combined Company will, or is likely to, generate going forward.

A significant portion of our total outstanding shares are restricted from immediate resale but may be sold into the market in the near future. This could cause the market price of Class A Stock to drop significantly, even if our business is doing well.

Sales of a substantial number of shares of Class A Stock in the public market could occur at any time. These sales, or the perception in the market that the holders of a large number of shares intend to sell shares, could reduce the market price of Class A Stock. Following the consummation of the Business Combination, our Initial Stockholders will hold approximately 3.69% of Class A Stock, assuming no exercise of redemption rights by our public stockholders. In addition, the holders of Founder Shares, Private Warrants and warrants that may be issued upon conversion of certain working capital loans, if any, (and any shares of Class A Stock issuable upon the exercise of the Private Warrants) are entitled to registration rights pursuant to our existing registration rights agreement, to require us to register a sale of any of our securities held by them prior to the consummation of our initial business combination.

In addition, at the consummation of the Business Combination, the Registration Rights Holders will enter into the Registration Rights Agreement, pursuant to which, (a) any (i) outstanding shares of Class A Stock or any Private

 

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Warrants, (ii) shares of Class A Stock issued or issuable upon the exercise of any other equity security of dMY (including shares of Class A Stock issued or issuable upon the conversion of the Class B Stock and upon exercise of the Private Warrants) and (b) any other equity security of dMY issued or issuable with respect to any such share of Class A Stock by way of a stock dividend or stock split or in connection with a combination of shares, recapitalization, merger, consolidation or other reorganization or otherwise, will be entitled to registration rights. In addition, concurrently with the execution and delivery of the Merger Agreement, we have entered into the Sponsor Support Agreement with the Insiders, the Sponsor and IonQ, pursuant to which the Insiders and the Sponsor have agreed to (i) vote all of their shares (and their permitted transferees will agree to vote all of their shares) of Class A Stock and Class B Stock in favor of the proposals listed herein, which shares represent 20% of the outstanding shares of Class A Stock on an as-converted basis, (ii) not redeem any of the shares of dMY stock owned by such holder in connection with the stockholder approvals contemplated hereby and (iii) certain restrictions on certain of their shares of Class A Stock and Class B Stock. Under the Sponsor Support Agreement it was agreed that the Sponsor and each of the Insiders agrees that, effective upon the consummation of the Business Combination, 10% of the Founder Shares (750,000 shares), which will be converted into shares of Class A Stock at the consummation of the Business Combination, shall be unvested and shall be subject to certain vesting and forfeiture provisions. In addition, concurrently with the execution and delivery of the Merger Agreement, the Sponsor, the current management of IonQ, the board of directors of dMY and certain current shareholders of IonQ entered into the Lock-Up Agreement pursuant to which the parties agreed to transfer restrictions as follows: (i) certain current stockholders of IonQ will be restricted until the earlier of (x) 180 days after the closing date and (y) the date on which the Combined Company completes a liquidation, merger, capital stock exchange, reorganization or other similar transaction that results in all of the Combined Company’s stockholders having the right to exchange their shares for cash, securities or other property; (ii) members of IonQ’s management will be restricted until the earlier of (x) 365 days after the closing date, (y) the day after the date on which the closing price of the Combined Company’s common stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least 180 days after the closing date and (z) the date on which the Combined Company completes a liquidation, merger, capital stock exchange, reorganization or other similar transaction that results in all of the Combined Company’s stockholders having the right to exchange their shares for cash, securities or other property; and (iii) members of dMY’s board of directors and the Sponsor will be restricted until the earlier of (x) 365 days after the closing date, (y) the day after the date on which the closing price of the Combined Company’s common stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least 150 days after the closing date and (z) the date on which the Combined Company completes a liquidation, merger, capital stock exchange, reorganization or other similar transaction that results in all of the Combined Company’s stockholders having the right to exchange their shares for cash, securities or other property.

Furthermore, given that the lock-up period on the Founder Shares is potentially shorter than most other blank check companies, these shares may become registered and available for sale sooner than Founder Shares in such other companies.

We may be unable to obtain additional financing to fund the operations and growth of the Combined Company.

We may require additional financing to fund the operations or growth of the Combined Company. The failure to secure additional financing could have a material adverse effect on the continued development or growth of the Combined Company. None of our officers, directors or stockholders is required to provide any financing to us in connection with or following the consummation of the Business Combination.

 

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Changes in laws, regulations or rules, or a failure to comply with any laws, regulations or rules, may adversely affect our business, investments and results of operations.

We are subject to laws, regulations and rules enacted by national, regional and local governments and NYSE. In particular, we are required to comply with certain SEC, NYSE and other legal or regulatory requirements. Compliance with, and monitoring of, applicable laws, regulations and rules may be difficult, time consuming and costly. Those laws, regulations or rules and their interpretation and application may also change from time to time and those changes could have a material adverse effect on our business, investments and results of operations. In addition, a failure to comply with applicable laws, regulations or rules, as interpreted and applied, could have a material adverse effect on our business and results of operations.

We have not registered the shares of Class A Stock issuable upon exercise of the Public Warrants under the Securities Act or any state securities laws at this time, and such registration may not be in place when an investor desires to exercise Public Warrants, thus precluding such investor from being able to exercise its Public Warrants except on a cashless basis and potentially causing such Public Warrants to expire worthless.

If the issuance of the Class A Stock upon exercise of the Public Warrants is not registered, qualified or exempt from registration or qualification under the Securities Act and applicable state securities laws, holders of Public Warrants will not be entitled to exercise such Public Warrants and such Public Warrants may have no value and expire worthless. In such event, holders who acquired their Public Warrants as part of a purchase of units will have paid the full unit purchase price solely for the Class A Stock included in the units.

We are not registering the Class A Stock issuable upon exercise of the Public Warrants under the Securities Act or any state securities laws at this time. However, under the terms of the warrant agreement, we have agreed that, as soon as practicable, but in no event later than the date of the consummation of our initial business combination, we will use our best efforts to file with the SEC a registration statement covering the registration under the Securities Act of the Class A Stock issuable upon exercise of the Public Warrants and thereafter will use our best efforts to cause the same to become effective within 30 business days following our initial business combination and to maintain a current prospectus relating to the Class A Stock issuable upon exercise of the Public Warrants until the expiration of the Public Warrants in accordance with the provisions of the warrant agreement. We cannot assure you that we will be able to do so if, for example, any facts or events arise which represent a fundamental change in the information set forth in the registration statement or prospectus, the financial statements contained or incorporated by reference therein are not current or correct or the SEC issues a stop order.

If the shares of Class A Stock issuable upon exercise of the Public Warrants are not registered under the Securities Act, under the terms of the warrant agreement, holders of Public Warrants who seek to exercise their Public Warrants will not be permitted to do so for cash and, instead, will be required to do so on a cashless basis in accordance with Section 3(a)(9) of the Securities Act or another exemption.

In no event will Public Warrants be exercisable for cash or on a cashless basis, and we will not be obligated to issue any shares to holders seeking to exercise their Public Warrants, unless the issuance of the shares upon such exercise is registered or qualified under the securities laws of the state of the exercising holder, or an exemption from registration or qualification is available.

If our shares of Class A Stock are at the time of any exercise of a Public Warrant, not listed on a national securities exchange such that they satisfy the definition of “covered securities” under Section 18(b)(1) of the Securities Act, we may, at our option, not permit holders of Public Warrants who seek to exercise their Public Warrants to do so for cash and, instead, require them to do so on a cashless basis in accordance with Section 3(a)(9) of the Securities Act; in the event we so elect, we will not be required to file or maintain in effect a registration statement or register or qualify the shares underlying the Public Warrants under applicable state securities laws, and in the event we do not so elect, we will use our best efforts to register or qualify the shares underlying the Public Warrants under applicable state securities laws to the extent an exemption is not available.

 

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In no event will we be required to net cash settle any Public Warrant, or issue securities (other than upon a cashless exercise as described above) or other compensation in exchange for the Public Warrants in the event that we are unable to register or qualify the shares underlying the Public Warrants under the Securities Act or applicable state securities laws.

The exercise price for our Public Warrants is higher than in many similar blank check company offerings in the past, and, accordingly, the Public Warrants are more likely to expire worthless.

The exercise price of our Public Warrants is higher than is typical with many similar blank check companies in the past. Historically, with regard to units offered by blank check companies, the exercise price of a Public Warrant was generally a fraction of the purchase price of the Public Units in the dMY IPO. The exercise price for our Public Warrants is $11.50 per share, subject to adjustment as provided herein. As a result, the Public Warrants are less likely to ever be in the money and more likely to expire worthless.

We may amend the terms of the Public Warrants in a manner that may be adverse to holders with the approval by the holders of at least 50% of the then-outstanding Public Warrants. As a result, the exercise price of a holder’s Public Warrants could be increased, the exercise period could be shortened and the number of shares of our Common Stock purchasable upon exercise of a Public Warrant could be decreased, all without the approval of that warrant holder.

Our Public Warrants were issued in registered form under the Continental Warrant Agreement. The Continental Warrant Agreement provides that the terms of the Public Warrants may be amended without the consent of any holder to cure any ambiguity or correct any defective provision, but requires the approval by the holders of at least 50% of the then-outstanding Public Warrants to make any change that adversely affects the interests of the registered holders. Accordingly, we may amend the terms of the Public Warrants in a manner adverse to a holder if holders of at least 50% of the then-outstanding Public Warrants approve of such amendment. Although our ability to amend the terms of the Public Warrants with the consent of at least 50% of the then-outstanding Public Warrants is unlimited, examples of such amendments could be amendments to, among other things, increase the exercise price of the Public Warrants, shorten the exercise period or decrease the number of shares of Class A Stock purchasable upon exercise of a Public Warrant.

We may redeem unexpired Public Warrants prior to their exercise at a time that is disadvantageous to warrant holders, thereby making their Public Warrants worthless.

We have the ability to redeem outstanding Public Warrants at any time after they become exercisable and prior to their expiration (A) at a price of $0.01 per Public Warrant; provided that the last reported sales price of Class A Stock equals or exceeds $18.00 per share for any 20 trading days within a 30 trading-day period ending on the third trading day prior to the date on which we give proper notice of such redemption to the warrant holders and provided certain other conditions are met, and (B) at a price of $0.10 per Public Warrant; provided that holders will be able to exercise their warrants on a cashless basis prior to redemption and receive that number of shares determined by reference to an agreed table based on the redemption date and the “fair market value” of the Class A common stock, and if the last reported sales price of Class A Stock equals or exceeds $10.00 per share (as adjusted for adjustments to the number of shares issuable upon exercise or the exercise price of a warrant as described under the heading “Description of Combined Company Securities—Warrants—Public Warrants—Anti-Dilution Adjustments”) for any 20 trading days within the 30-trading day period ending three trading days before we send the notice of redemption to the warrant holders and provided certain other conditions are met. A redemption in accordance with (B) above could take place at a price lower than the Public Warrants’ $11.50 exercise price and may result in warrant holders having to exercise the Public Warrants at a time when they are out-of-the-money or receive nominal consideration from the Company for them. Please see the section titled “Description of Combined Company Securities—Warrants—Public Warrants” for additional information.

If and when the Public Warrants become redeemable by us, we may exercise our redemption right even if we are unable to register or qualify the underlying securities for sale under all applicable state securities laws. Redemption of

 

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the outstanding Public Warrants could force the warrant holders: (i) to exercise their Public Warrants and pay the exercise price therefor at a time when it may be disadvantageous for them to do so; (ii) to sell their Public Warrants at the then-current market price when they might otherwise wish to hold their Public Warrants; or (iii) to accept the nominal redemption price which, at the time the outstanding Public Warrants are called for redemption, is likely to be substantially less than the market value of their Public Warrants. None of the Private Warrants will be redeemable by us so long as they are held by the Sponsor or its permitted transferees.

Because each Public Unit contains one-fourth of one Public Warrant and only a whole Public Warrant may be exercised, the Public Units may be worth less than Public Units of other blank check companies.

Each Public Unit contains one-fourth of one Public Warrant. Because, pursuant to the Continental Warrant Agreement, the Public Warrants may only be exercised for a whole number of shares, only a whole Public Warrant may be exercised at any given time. This is different from other offerings similar to ours whose public units include one share of common stock and one Public Warrant to purchase one whole share. We have established the components of the Public Units in this way in order to reduce the dilutive effect of the Public Warrants upon completion of an initial business combination since the Public Warrants will be exercisable in the aggregate for one-fourth of the number of shares compared to Public Units that each contain a Public Warrant to purchase one whole share, thus making us, we believe, a more attractive merger partner for target businesses. Nevertheless, this unit structure may cause our Public Units to be worth less than if they included a Public Warrant to purchase one whole share.

Warrants will become exercisable for Class A Stock, which would increase the number of shares eligible for future resale in the public market and result in dilution to our stockholders.

We issued Public Warrants to purchase 7,500,000 shares of Class A Stock as part of the dMY IPO and, on the dMY IPO’s closing date, we issued Private Warrants to the Sponsor to purchase 4,000,000 shares of Class A Stock, in each case at $11.50 per share. In addition, prior to consummating an initial business combination, nothing prevents us from issuing additional securities in a private placement so long as they do not participate in any manner in the Trust Account or vote as a class with the Common Stock on an initial business combination. The shares of Class A Stock issued upon exercise of our warrants will result in dilution to our then existing holders of Class A Stock and increase the number of shares eligible for resale in the public market. Sales of substantial numbers of such shares in the public market could adversely affect the market price of Class A Stock.

The Private Warrants are identical to the Public Warrants sold as part of the Public Units issued in the dMY IPO except that, so long as they are held by the Sponsor or its permitted transferees: (i) they will not be redeemable by us; (ii) they (including the Class A Stock issuable upon exercise of these warrants) may not, subject to certain limited exceptions, be transferred, assigned or sold by the Sponsor until 30 days after the completion of an initial business combination; (iii) they may be exercised by the holders on a cashless basis; and (iv) are subject to registration rights.

Our stockholders may be held liable for claims by third parties against us to the extent of distributions received by them upon redemption of their shares.

Under the DGCL, stockholders may be held liable for claims by third parties against a corporation to the extent of distributions received by them in a dissolution. The pro rata portion of the Trust Account distributed to the public stockholders upon the redemption of our Public Shares in the event we do not complete an initial business combination by November 17, 2022 may be considered a liquidating distribution under Delaware law. If a corporation complies with certain procedures set forth in Section 280 of the DGCL intended to ensure that it makes reasonable provision for all claims against it, including a 60-day notice period during which any third-party claims can be brought against the corporation, a 90-day period during which the corporation may reject any claims brought, and an additional 150-day waiting period before any liquidating distributions are made to stockholders, any liability of stockholders with respect to a liquidating distribution is limited to the lesser of such stockholder’s pro rata share of the claim or the amount distributed to the stockholder, and any liability of the stockholder would be barred after the third anniversary of the dissolution. However, it is our intention to redeem our Public Shares as soon as reasonably possible following November 17, 2022 in the event we do not complete an initial business combination and, therefore, we do not intend to comply with the foregoing procedures.

 

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Because we will not be complying with Section 280 of the DGCL, Section 281(b) of the DGCL requires us to adopt a plan, based on facts known to us at such time that will provide for our payment of all existing and pending claims or claims that may be potentially brought against us within the ten years following our dissolution. However, because we are a blank check company, rather than an operating company, and our operations are limited to searching for prospective target businesses to acquire, the only likely claims to arise would be from our vendors (such as lawyers, investment bankers, etc.) or prospective target businesses. If our plan of distribution complies with Section 281(b) of the DGCL, any liability of stockholders with respect to a liquidating distribution is limited to the lesser of such stockholder’s pro rata share of the claim or the amount distributed to the stockholder, and any liability of the stockholder would likely be barred after the third anniversary of the dissolution. We cannot assure you that we will properly assess all claims that may be potentially brought against us. As such, our stockholders could potentially be liable for any claims to the extent of distributions received by them (but no more) and any liability of our stockholders may extend beyond the third anniversary of such date. Furthermore, if the pro rata portion of the Trust Account distributed to our public stockholders upon the redemption of our Public Shares in the event we do not complete an initial business combination by November 17, 2022 is not considered a liquidating distribution under Delaware law and such redemption distribution is deemed to be unlawful, then pursuant to Section 174 of the DGCL, the statute of limitations for claims of creditors could then be six years after the unlawful redemption distribution, instead of three years, as in the case of a liquidating distribution.

If, after we distribute the proceeds in the Trust Account to the public stockholders, we file a bankruptcy petition or an involuntary bankruptcy petition is filed against us that is not dismissed, a bankruptcy court may seek to recover such proceeds, and we and our Board may be exposed to claims of punitive damages.

If, after we distribute the proceeds in the Trust Account to the public stockholders, we file a bankruptcy petition or an involuntary bankruptcy petition is filed against us that is not dismissed, any distributions received by stockholders could be viewed under applicable debtor/creditor and/or bankruptcy laws as either a “preferential transfer” or a “fraudulent conveyance.” As a result, a bankruptcy court could seek to recover all amounts received by our stockholders. In addition, our Board may be viewed as having breached its fiduciary duty to our creditors and/or having acted in bad faith, thereby exposing itself and us to claims of punitive damages, by paying public stockholders from the Trust Account prior to addressing the claims of creditors.

Our internal controls over financial reporting may not be effective and our independent registered public accounting firm may not be able to certify as to their effectiveness, which could have a significant and adverse effect on our business and reputation.

As a public company, we are required to comply with the SEC’s rules implementing Sections 302 and 404 of the Sarbanes-Oxley Act, which require management to certify financial and other information in our quarterly and annual reports and provide an annual management report on the effectiveness of internal control over financial reporting. To comply with the requirements of being a public company, the Combined Company will be required to provide attestation on internal controls, and we may need to undertake various actions, such as implementing additional internal controls and procedures and hiring additional accounting or internal audit staff. The standards required for a public company under Section 404 of the Sarbanes-Oxley Act are significantly more stringent than those required of IonQ as a privately-held company. Further, as an emerging growth company, our independent registered public accounting firm is not required to formally attest to the effectiveness of our internal controls over financial reporting pursuant to Section 404 until the date we are no longer an emerging growth company. At such time, our independent registered public accounting firm may issue a report that is adverse in the event that it is not satisfied with the level at which the controls of the Combined Company are documented, designed or operating.

Testing and maintaining these controls can divert our management’s attention from other matters that are important to the operation of our business. If we identify material weaknesses in the internal control over financial reporting of the Combined Company or are unable to comply with the requirements of Section 404 or assert that our internal control over financial reporting is effective, or if our independent registered public accounting firm is unable to express an opinion as to the effectiveness of our internal controls over financial

 

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reporting when we no longer qualify as an emerging growth company, investors may lose confidence in the accuracy and completeness of our financial reports and the market price of our common stock could be negatively affected, and we could become subject to investigations by the SEC or other regulatory authorities, which could require additional financial and management resources.

We have identified a material weakness in our internal control over financial reporting. This material weakness could continue to adversely affect our ability to report our results of operations and financial condition accurately and in a timely manner.

Our management is responsible for establishing and maintaining adequate internal control over financial reporting designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with GAAP. Our management is likewise required, on a quarterly basis, to evaluate the effectiveness of our internal controls and to disclose any changes and material weaknesses identified through such evaluation in those internal controls. A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis.

We identified a material weakness in our internal control over financial reporting related to the accounting for a significant and unusual transaction related to the warrants we issued in connection with our initial public offering in November 2020. As a result of this material weakness, our management concluded that our internal control over financial reporting was not effective as of December 31, 2020. This material weakness resulted in a material misstatement of our warrant liabilities, change in fair value of warrant liabilities, Class A Stock subject to possible redemption, additional paid-in capital, accumulated deficit and related financial disclosures for the fiscal year ended December 31, 2020.

To respond to this material weakness, we have devoted significant effort and resources to the remediation and improvement of our internal control over financial reporting. The elements of our remediation plan can only be accomplished over time, and we can offer no assurance that these initiatives will ultimately have the intended effects. For a discussion of management’s consideration of the material weakness identified related to our accounting for a significant and unusual transaction related to the warrants we issued in connection with the November 2020 initial public offering, see “Note 2—Restatement of Previously Issued Financial Statements” to our annual consolidated financial statements.

Efforts to remediate this material weakness may not be effective or prevent any future material weakness or significant deficiency in the Combined Company’s internal control over financial reporting. If the Combined Company’s efforts are not successful or other material weaknesses or control deficiencies occur in the future, the Combined Company may be unable to report its financial results accurately on a timely basis, which could cause Combined Company’s reported financial results to be materially misstated and result in the loss of investor confidence and cause the market price of the Combined Company’s common stock to decline. Ineffective internal controls could also cause investors to lose confidence in the Combined Company’s reported financial information, which could have a negative effect on the trading price of its stock.

We can give no assurance that the measures we have taken or that the Combined Company plans to take in the future will remediate the material weakness identified or that any additional material weaknesses or restatements of financial results will not arise in the future due to a failure to implement and maintain adequate internal control over financial reporting or circumvention of these controls. The Combined Company will be required, pursuant to Section 404 of the Sarbanes-Oxley Act, to annually furnish a report by management on, among other things, the effectiveness of its internal control over financial reporting. This assessment will need to include disclosure of any material weaknesses identified by the Combined Company’s management in its internal control over financial reporting. The Combined Company’s independent registered public accounting firm may be required to attest to the effectiveness of its internal control over financial reporting depending on the Combined

 

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Company’s reporting status. The Combined Company will be required to disclose changes made in its internal control and procedures on a quarterly basis. To comply with the requirements of being a public company, the Combined Company may need to undertake various actions, such as implementing new internal controls and procedures and hiring accounting or internal audit staff.

Risks Related to Ownership of the Combined Company’s Shares

dMY’s Current Charter provides, and the Combined Company’s Proposed Charter will provide, subject to limited exceptions, that the Court of Chancery will be the sole and exclusive forum for certain stockholder litigation matters, which could limit its stockholders’ ability to obtain a chosen judicial forum for disputes with the Combined Company or its directors, officers, employees or stockholders.

dMY’s Current Charter requires, and the Combined Company’s Proposed Charter will require, to the fullest extent permitted by law, that derivative actions brought in the Combined Company’s name, actions against directors, officers and employees for breach of fiduciary duty and other similar actions may be brought in the Court of Chancery or, if that court lacks subject matter jurisdiction, another federal or state court situated in the State of Delaware. Any person or entity purchasing or otherwise acquiring any interest in shares of the Combined Company’s capital stock shall be deemed to have notice of and consented to the forum provisions in the Combined Company’s Proposed Charter. In addition, the Combined Company’s Proposed Charter and amended and restated bylaws will provide that the federal district courts of the United States shall be the exclusive forum for the resolution of any complaint asserting a cause of action under the Securities Act and the Exchange Act.

This choice of forum provision may limit a stockholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with the Combined Company or any of its directors, officers, other employees or stockholders, which may discourage lawsuits with respect to such claims, although such stockholders will not be deemed to have waived the Combined Company’s compliance with federal securities laws and the rules and regulations thereunder.

However, there is no assurance that a court would enforce the choice of forum provision contained in the Proposed Charter. If a court were to find the choice of forum provision contained in dMY’s Current Charter or the Combined Company’s Proposed Charter to be inapplicable or unenforceable in an action, the Combined Company may incur additional costs associated with resolving such action in other jurisdictions, which could harm its business, operating results and financial condition.

Anti-takeover provisions in the Combined Company’s governing documents could delay or prevent a change of control.

Certain provisions of the Proposed Charter and the Combined Company’s amended and restated bylaws to become effective upon the consummation of the Business Combination may have an anti-takeover effect and may delay, defer or prevent a merger, acquisition, tender offer, takeover attempt or other change of control transaction that a stockholder might consider in its best interest, including those attempts that might result in a premium over the market price for the shares held by the Combined Company’s stockholders.

These provisions provide for, among other things:

 

   

the ability of the Combined Company’s board of directors to issue one or more series of preferred stock;

 

   

a classified board;

 

   

advance notice for nominations of directors by stockholders and for stockholders to include matters to be considered at the Combined Company’s annual meetings;

 

   

certain limitations on convening special stockholder meetings;

 

   

limiting the persons who may call special meetings of stockholders;

 

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limiting the ability of stockholders to act by written consent; and

 

   

the Combined Company’s board of directors have the express authority to make, alter or repeal the Combined Company’s amended and restated bylaws.

These anti-takeover provisions could make it more difficult or frustrate or prevent a third party to acquire the Combined Company, even if the third party’s offer may be considered beneficial by many of the Combined Company’s stockholders. Additionally, the provisions may frustrate or prevent any attempts by the Combined Company stockholders to replace or remove its current management by making it more difficult for stockholders to replace members of the Combined Company’s board of directors, which is responsible for appointing the members of its management. As a result, the Combined Company’s stockholders may be limited in their ability to obtain a premium for their shares. These provisions could also discourage proxy contests and make it more difficult for you and other stockholders to elect directors of your choosing and to cause the Combined Company to take other corporate actions you desire. See “Description of the Combined Company’s Securities.”

Claims for indemnification by the Combined Company’s directors and officers may reduce the Combined Company’s available funds to satisfy successful third-party claims against the Combined Company and may reduce the amount of money available to the Combined Company.

The Combined Company’s Proposed Charter and amended and restated bylaws will provide that the Combined Company will indemnify its directors and officers, in each case to the fullest extent permitted by Delaware law.

In addition, as permitted by Section 145 of the DGCL, the amended and restated bylaws and its indemnification agreements that it will enter into with its directors and officers will provide that:

 

   

the Combined Company will indemnify its directors and officers for serving the Combined Company in those capacities or for serving other business enterprises at its request, to the fullest extent permitted by Delaware law. Delaware law provides that a corporation may indemnify such person if such person acted in good faith and in a manner such person reasonably believed to be in or not opposed to the best interests of the registrant and, with respect to any criminal proceeding, had no reasonable cause to believe such person’s conduct was unlawful;

 

   

the Combined Company may, in its discretion, indemnify employees and agents in those circumstances where indemnification is permitted by applicable law;

 

   

the Combined Company will be required to advance expenses, as incurred, to its directors and officers in connection with defending a proceeding, except that such directors or officers shall undertake to repay such advances if it is ultimately determined that such person is not entitled to indemnification;

 

   

the Combined Company will not be obligated pursuant to its amended and restated bylaws to indemnify a person with respect to proceedings initiated by that person against the Combined Company or its other indemnitees, except with respect to proceedings authorized by its board of directors or brought to enforce a right to indemnification;

 

   

the rights conferred in the amended and restated bylaws are not exclusive, and the Combined Company is authorized to enter into indemnification agreements with its directors, officers, employees and agents and to obtain insurance to indemnify such persons; and

 

   

the Combined Company may not retroactively amend its Bylaw provisions to reduce its indemnification obligations to directors, officers, employees and agents.

Following the consummation of the Business Combination, our only significant asset will be our ownership interest in IonQ and such ownership may not be sufficient to pay dividends or make distributions or loans to enable us to pay any dividends on our Common Stock or satisfy our other financial obligations.

Following the consummation of the Business Combination, we will have no direct operations and no significant assets other than our ownership of IonQ. We and certain investors, the IonQ stockholders, and directors and

 

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officers of IonQ and its affiliates will become stockholders of the Combined Company. We will depend on IonQ for distributions, loans and other payments to generate the funds necessary to meet our financial obligations, including our expenses as a publicly traded company and to pay any dividends with respect to our Common Stock. The financial condition and operating requirements of IonQ may limit our ability to obtain cash from IonQ. The earnings from, or other available assets of, IonQ may not be sufficient to pay dividends or make distributions or loans to enable us to pay any dividends on our Common Stock or satisfy our other financial obligations.

IonQ does not intend to pay dividends for the foreseeable future.

IonQ has never declared or paid any cash dividends on its capital stock and does not intend to pay any cash dividends in the foreseeable future. IonQ expects to retain future earnings, if any, to fund the development and growth of its business. Any future determination to pay dividends on IonQ’s capital stock will be at the discretion of its board of directors.

The market price and trading volume of Class A Stock may be volatile and could decline significantly following the Business Combination.

The stock markets, including NYSE on which we intend to list the shares of Class A Stock to be issued in the Business Combination under the symbol “IONQ,” have from time to time experienced significant price and volume fluctuations. Even if an active, liquid and orderly trading market develops and is sustained for the Class A Stock following the Business Combination, the market price of Class A Stock may be volatile and could decline significantly. In addition, the trading volume in Class A Stock may fluctuate and cause significant price variations to occur. If the market price of Class A Stock declines significantly, you may be unable to resell your shares at or above the market price of Class A Stock as of the date of the consummation of the Business Combination. We cannot assure you that the market price of Class A Stock will not fluctuate widely or decline significantly in the future in response to a number of factors, including, among others, the following:

 

   

the realization of any of the risk factors presented in this proxy statement/prospectus;

 

   

actual or anticipated differences in our estimates, or in the estimates of analysts, for our revenues, results of operations, level of indebtedness, liquidity or financial condition;

 

   

additions and departures of key personnel;

 

   

failure to comply with the requirements of NYSE;

 

   

failure to comply with the Sarbanes-Oxley Act or other laws or regulations;

 

   

future issuances, sales, resales or repurchases or anticipated issuances, sales, resales or repurchases, of our securities;

 

   

publication of research reports about dMY;

 

   

the performance and market valuations of other similar companies;

 

   

commencement of, or involvement in, litigation involving IonQ or us;

 

   

broad disruptions in the financial markets, including sudden disruptions in the credit markets;

 

   

speculation in the press or investment community;

 

   

actual, potential or perceived control, accounting or reporting problems;

 

   

changes in accounting principles, policies and guidelines; and

 

   

other events or factors, including those resulting from infectious diseases, health epidemics and pandemics (including the ongoing COVID-19 public health emergency), natural disasters, war, acts of terrorism or responses to these events.

 

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In the past, securities class-action litigation has often been instituted against companies following periods of volatility in the market price of their shares. This type of litigation could result in substantial costs and divert our management’s attention and resources, which could have a material adverse effect on us.

Our quarterly operating results may fluctuate significantly and could fall below the expectations of securities analysts and investors due to seasonality and other factors, some of which are beyond our control, resulting in a decline in our stock price.

Our quarterly operating results may fluctuate significantly because of several factors, including:

 

   

labor availability and costs for hourly and management personnel;

 

   

profitability of our products, especially in new markets and due to seasonal fluctuations;

 

   

changes in interest rates;

 

   

impairment of long-lived assets;

 

   

macroeconomic conditions, both nationally and locally;

 

   

negative publicity relating to products we serve;

 

   

changes in consumer preferences and competitive conditions;

 

   

expansion to new markets; and

 

   

fluctuations in commodity prices.

If, following the Business Combination, securities or industry analysts do not publish or cease publishing research or reports about the Combined Company, its business, or its market, or if they change their recommendations regarding Class A Stock adversely, then the price and trading volume of Class A Stock could decline.

The trading market for Class A Stock will be influenced by the research and reports that industry or securities analysts may publish about us, our business, our market, or our competitors. Securities and industry analysts do not currently, and may never, publish research on dMY or the Combined Company. If no securities or industry analysts commence coverage of the Combined Company, our stock price and trading volume would likely be negatively impacted. If any of the analysts who may cover the Combined Company change their recommendation regarding our stock adversely, or provide more favorable relative recommendations about our competitors, the price of Class A Stock would likely decline. If any analyst who may cover dMY were to cease coverage of the Combined Company or fail to regularly publish reports on it, we could lose visibility in the financial markets, which could cause our stock price or trading volume to decline.

Future issuances of debt securities and equity securities may adversely affect us, including the market price of the Class A Stock and may be dilutive to existing stockholders.

In the future, we may incur debt or issue equity-ranking senior to the Class A Stock. Those securities will generally have priority upon liquidation. Such securities also may be governed by an indenture or other instrument containing covenants restricting its operating flexibility. Additionally, any convertible or exchangeable securities that we issue in the future may have rights, preferences and privileges more favorable than those of the Class A Stock. Because our decision to issue debt or equity in the future will depend on market conditions and other factors beyond our control, we cannot predict or estimate the amount, timing, nature or success of our future capital raising efforts. As a result, future capital raising efforts may reduce the market price of Class A Stock and be dilutive to existing stockholders.

There can be no assurance that Class A Stock that will be issued in connection with the Business Combination will be approved for listing on NYSE or, if approved, will continue to be so listed following the consummation of the Business Combination, or that we will be able to comply with the continued listing standards of NYSE.

Class A Stock, Public Units and Public Warrants are currently listed on NYSE. Our continued eligibility for listing may depend on, among other things, the number of our shares that are redeemed. We intend to apply to

 

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continue the listing of our publicly-traded common stock and warrants on NYSE. If, following the consummation of the Business Combination, NYSE delists Class A Stock from trading on its exchange for failure to meet the listing standards, we and our stockholders could face significant material adverse consequences including:

 

   

a limited availability of market quotations for our securities;

 

   

reduced liquidity for our securities;

 

   

a determination that Class A Stock is a “penny stock” which will require brokers trading in Class A Stock to adhere to more stringent rules and possibly result in a reduced level of trading activity in the secondary trading market for our securities; or

 

   

a decreased ability to issue additional securities or obtain additional financing in the future.

The National Securities Markets Improvement Act of 1996, which is a federal statute, prevents or preempts the states from regulating the sale of certain securities, which are referred to as “covered securities.” Because Class A Stock, Public Units and Public Warrants are listed on NYSE, they are covered securities. Although the states are preempted from regulating the sale of our securities, the federal statute does allow the states to investigate companies if there is a suspicion of fraud, and, if there is a finding of fraudulent activity, then the states can regulate or bar the sale of covered securities in a particular case. While we are not aware of a state, other than the State of Idaho, having used these powers to prohibit or restrict the sale of securities issued by blank check companies, certain state securities regulators view blank check companies unfavorably and might use these powers, or threaten to use these powers, to hinder the sale of securities of blank check companies in their states. Further, if we were no longer listed on NYSE, our securities would not be covered securities and we would be subject to regulation in each state in which we offer our securities.

The Combined Company’s failure to meet the continued listing requirements of NYSE could result in a delisting of its Securities.

If, after listing, the Combined Company fails to satisfy the continued listing requirements of NYSE such as the corporate governance requirements or the minimum share price requirement, NYSE may take steps to delist its securities. Such a delisting would likely have a negative effect on the price of the securities and would impair your ability to sell or purchase the securities when you wish to do so. In the event of a delisting, the Combined Company can provide no assurance that any action taken by it to restore compliance with listing requirements would allow its securities to become listed again, stabilize the market price or improve the liquidity of its securities, prevent its securities from dropping below the NYSE minimum share price requirement or prevent future non-compliance with NYSE’s listing requirements. Additionally, if the Combined Company’s securities are not listed on, or become delisted from, NYSE for any reason, and are quoted on the OTC Bulletin Board, an inter-dealer automated quotation system for equity securities that is not a national securities exchange, the liquidity and price of our securities may be more limited than if we were quoted or listed on NYSE or another national securities exchange. You may be unable to sell your securities unless a market can be established or sustained.

The Combined Company will qualify as an emerging growth company as well as a smaller reporting company within the meaning of the Securities Act, and if the Combined Company takes advantage of certain exemptions from disclosure requirements available to emerging growth companies or smaller reporting companies, this could make the Combined Company’s securities less attractive to investors and may make it more difficult to compare the Combined Company’s performance with other public companies.

We qualify, and following the consummation of the Business Combination, the Combined Company will qualify, as an “emerging growth company” within the meaning of the Securities Act, as modified by the JOBS Act, and may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies for as long as the Combined Company continues to be an emerging growth company, including, but not limited to, not being required to comply with the auditor

 

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attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in the Combined Company’s periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. As a result, the Combined Company’s stockholders may not have access to certain information they may deem important. The Combined Company will remain an emerging growth company until the earliest of (i) the last day of the fiscal year in which the market value of Common Stock that is held by non-affiliates equals or exceeds $700 million as of the end of that year’s second fiscal quarter, (ii) the last day of the fiscal year in which the Combined Company has total annual gross revenue of $1.07 billion or more during such fiscal year (as indexed for inflation), (iii) the date on which the Combined Company has issued more than $1 billion in non-convertible debt in the prior three-year period or (iv) December 31, 2025. Investors may find the Combined Company’s securities less attractive because the Combined Company will rely on these exemptions. If some investors find the Combined Company’s securities less attractive as a result of its reliance on these exemptions, the trading prices of the Combined Company’s securities may be lower than they otherwise would be, there may be a less active trading market for its securities and the trading prices of its securities may be more volatile.

In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the exemption from complying with new or revised accounting standards provided in Section 7(a)(2)(B) of the Securities Act as long as the Combined Company is an emerging growth company. An emerging growth company can therefore delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. The Combined Company has elected not to opt out of such extended transition period and, therefore, the Combined Company may not be subject to the same new or revised accounting standards as other public companies that are not emerging growth companies. This may make comparison of its financial statements with another public company which is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible because of the potential differences in accountant standards used.

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

Risks Related to the Redemption

We do not have a specified maximum redemption threshold. The absence of such a redemption threshold may make it possible for us to complete a Business Combination with which a substantial majority of our stockholders do not agree.

The Current Charter does not provide a specified maximum redemption threshold, except that we will not redeem our Public Shares in an amount that would result in our failure to have net tangible assets in excess of $5,000,001 (such that we are not subject to the SEC’s “penny stock” rules). As a result, we may be able to complete the Business Combination even though a substantial portion of our public stockholders do not agree with the transaction and have redeemed their shares or have entered into privately negotiated agreements to sell their shares to the Sponsor, directors or officers or their affiliates. As of the date of this proxy statement/prospectus, no agreements with respect to the private purchase of Public Shares by us or the persons described above have been entered into with any such investor or holder. We will file a Current Report on Form 8-K with the SEC to disclose private arrangements entered into or significant private purchases made by any of the aforementioned persons that would affect the vote on the Transaction Proposal or other proposals (as described in this proxy statement/prospectus) at the Special Meeting.

 

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In the event the aggregate cash consideration we would be required to pay for all shares of Class A Stock that are validly submitted for redemption plus any amount required to satisfy cash conditions pursuant to the terms of the Merger Agreement exceeds the aggregate amount of cash available to us, we may not complete the Business Combination or redeem any shares, all shares of Class A Stock submitted for redemption will be returned to the holders thereof, and we instead may search for an alternate initial business combination.

If you or a “group” of stockholders of which you are a part are deemed to hold an aggregate of more than 20% of Class A Stock issued in the dMY IPO, you (or, if a member of such a group, all of the members of such group in the aggregate) will lose the ability to redeem all such shares in excess of 20% of Class A Stock issued in the dMY IPO.

A Public Stockholder, together with any of his, her or its affiliates or any other person with whom it is acting in concert or as a “group” (as defined under Section 13 of the Exchange Act), will be restricted from redeeming in the aggregate his, her or its shares or, if part of such a group, the group’s shares, in excess of 20% of the shares of Class A Stock included in the Public Units sold in the dMY IPO. In order to determine whether a stockholder is acting in concert or as a group with another stockholder, we will require each Public Stockholder seeking to exercise redemption rights to certify to us whether such stockholder is acting in concert or as a group with any other stockholder. Such certifications, together with other public information relating to stock ownership available to us at that time, such as Section 13D, Section 13G and Section 16 filings under the Exchange Act, will be the sole basis on which we make the above-referenced determination. Your inability to redeem any such excess shares will reduce your influence over our ability to consummate the Business Combination and you could suffer a material loss on your investment in us if you sell such excess shares in open market transactions. Additionally, you will not receive redemption distributions with respect to such excess shares if we consummate the Business Combination. As a result, you will continue to hold that number of shares aggregating to more than 20% of the shares sold in the dMY IPO and, in order to dispose of such excess shares, would be required to sell your stock in open market transactions, potentially at a loss. We cannot assure you that the value of such excess shares will appreciate over time following the Business Combination or that the market price of Class A Stock will exceed the per-share redemption price. Notwithstanding the foregoing, stockholders may challenge our determination as to whether a stockholder is acting in concert or as a group with another stockholder in a court of competent jurisdiction.

However, our stockholders’ ability to vote all of their shares (including such excess shares) for or against the Business Combination is not restricted by this limitation on redemption.

There is no guarantee that a stockholder’s decision whether to redeem its shares for a pro rata portion of the Trust Account will put the stockholder in a better future economic position.

We can give no assurance as to the price at which a stockholder may be able to sell its Public Shares in the future following the completion of the Business Combination or any alternative initial business combination. Certain events following the consummation of any initial business combination, including the Business Combination, may cause an increase in our share price, and may result in a lower value realized now than a stockholder of dMY might realize in the future had the stockholder not redeemed its shares. Similarly, if a stockholder does not redeem its shares, the stockholder will bear the risk of ownership of the Public Shares after the consummation of any initial business combination, and there can be no assurance that a stockholder can sell its shares in the future for a greater amount than the redemption price set forth in this proxy statement/prospectus. A stockholder should consult the stockholder’s own tax and/or financial advisor for assistance on how this may affect his, her or its individual situation.

 

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Our stockholders who wish to redeem their shares for a pro rata portion of the Trust Account must comply with specific requirements for redemption that may make it more difficult for them to exercise their redemption rights prior to the deadline. If stockholders fail to comply with the redemption requirements specified in this proxy statement/prospectus, they will not be entitled to redeem their shares of Class A Stock for a pro rata portion of the funds held in our Trust Account.

Public stockholders who wish to redeem their shares for a pro rata portion of the Trust Account must, among other things (i) submit a request in writing and (ii) tender their certificates to our Transfer Agent or deliver their shares to the Transfer Agent electronically through the DWAC system at least two business days prior to the Special Meeting. In order to obtain a physical stock certificate, a stockholder’s broker and/or clearing broker, DTC and our Transfer Agent will need to act to facilitate this request. It is our understanding that stockholders should generally allot at least two weeks to obtain physical certificates from the Transfer Agent. However, because we do not have any control over this process or over the brokers, it may take significantly longer than two weeks to obtain a physical stock certificate. If it takes longer than anticipated to obtain a physical certificate, stockholders who wish to redeem their shares may be unable to obtain physical certificates by the deadline for exercising their redemption rights and thus will be unable to redeem their shares.

Stockholders electing to redeem their shares will receive their pro rata portion of the Trust Account less taxes payable, calculated as of two business days prior to the anticipated consummation of the Business Combination. Please see the section titled “Special Meeting of the Stockholders of dMY—Redemption Rights” for additional information on how to exercise your redemption rights.

If a stockholder fails to receive notice of our offer to redeem our Public Shares in connection with the Business Combination or fails to comply with the procedures for tendering its shares, such shares may not be redeemed.

If, despite our compliance with the proxy rules, a stockholder fails to receive our proxy materials, such stockholder may not become aware of the opportunity to redeem its shares. In addition, the proxy materials that we are furnishing to holders of our Public Shares in connection with the Business Combination describes the various procedures that must be complied with in order to validly redeem Public Shares. In the event that a stockholder fails to comply with these procedures, its shares may not be redeemed.

 

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SPECIAL MEETING OF THE STOCKHOLDERS OF DMY

General

This proxy statement/prospectus is being provided to dMY stockholders as part of a solicitation of proxies by our Board for use at the Special Meeting of dMY to be held on             , 2021, and at any adjournment thereof. This proxy statement/prospectus contains important information regarding the Special Meeting, the proposals on which you are being asked to vote and information you may find useful in determining how to vote and voting procedures.

This proxy statement/prospectus is being first mailed on or about             , 2021 to all stockholders of record of dMY as of             , 2021, the record date for the Special Meeting. Stockholders of record who owned shares of Common Stocks at the close of business on the record date are entitled to receive notice of, attend and vote at the Special Meeting. On the record date, there were                  shares of Common Stock outstanding.

Date, Time and Place of Special Meeting

In light of public health concerns regarding the coronavirus (COVID-19) pandemic, the Special Meeting will be held via live webcast on             , 2021, at              Eastern time. The Special Meeting can be accessed by visiting https://www.cstproxy.com/dmytechnologyiii/sm2021, where you will be able to listen to the meeting live and vote during the meeting. Additionally, you have the option to listen only to the Special Meeting by dialing 1-888-965-8995 (toll-free within the U.S. and Canada) or +1 415-655-0243 (outside of the U.S. and Canada, standard rates apply). The passcode for telephone access is 28259093, but please note that you cannot vote or ask questions if you choose to participate telephonically. Please note that you will only be able to access the Special Meeting by means of remote communication. Please have your Control Number, which can be found on your proxy card, to join the special meeting via the virtual meeting platform. If you do not have a control number, please contact Continental Stock Transfer Company, the Transfer Agent.

Purpose of the Special Meeting

At the Special Meeting, Company stockholders will vote on the following proposals:

 

  1.

Transaction Proposal;

 

  2.

NYSE Proposal;

 

  3.

Charter Proposal;

 

  4.

Governance Proposals;

 

  5.

Equity Incentive Plan Proposal;

 

  6.

Employee Stock Purchase Plan Proposal—; and

 

  7.

Adjournment Proposal.

OUR BOARD UNANIMOUSLY RECOMMENDS

THAT YOU VOTE “FOR” EACH OF THESE PROPOSALS.

Voting Power; Record Date

As a dMY stockholder, you have a right to vote on certain matters affecting dMY. The proposals that will be presented at the Special Meeting and upon which you are being asked to vote are summarized above and fully set forth in this proxy statement/prospectus. You will be entitled to vote or direct votes to be cast at the Special Meeting if you owned shares of Common Stock at the close of business on             , 2021 which is the record date

 

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for the Special Meeting. You are entitled to one vote for each share of Common Stock that you owned as of the close of business on the record date. If your shares are held in “street name” or are in a margin or similar account, you should contact your broker, bank or other nominee to ensure that votes related to the shares you beneficially own are properly counted. On the record date, there were                  shares of Common Stock outstanding, of which are Public Shares and                  are Founder Shares held by our Initial Stockholders.

Vote of the dMY Initial Stockholders and dMY’s Other Directors and Officers

Prior to the dMY IPO, we entered into agreements with the Sponsor and each of our directors and officers, pursuant to which each agreed to vote any shares of Common Stock owned by them in favor of the Transaction Proposal. None of the Sponsor, directors or officers has purchased any shares of our Common Stock during or after the dMY IPO and, as of the date of this proxy statement/prospectus, neither we nor the Sponsor, directors or officers have entered into agreements, and are not currently in negotiations, to purchase shares prior to the consummation of the Business Combination. Currently, our Initial Stockholders own 20% of our issued and outstanding shares of Common Stock, including all of the Founder Shares, and will be able to vote all such shares at the Special Meeting.

Our Initial Stockholders have entered into a letter agreement with us, pursuant to which they have waived their rights to liquidating distributions from the Trust Account with respect to their Founder Shares if we fail to complete an initial business combination within 24 months from the closing date of the dMY IPO. However, if our Initial Stockholders acquire Public Shares after the dMY IPO, they will be entitled to liquidating distributions from the Trust Account with respect to such Public Shares if we fail to complete an initial business combination within the allotted 24-month time period.

Quorum and Required Vote for Proposals for the Special Meeting

The approval of the Transaction Proposal (and consequently, the Merger Agreement and the transactions contemplated thereby, including the Business Combination) will be approved only if at least a majority of the votes cast by holders of outstanding shares of our Common Stock represented in person via the virtual meeting platform or by proxy and entitled to vote thereon at the Special Meeting vote “FOR” the Transaction Proposal. Failure to vote by proxy or to vote in person via the virtual meeting platform at the Special Meeting, abstentions and broker non-votes will have no effect on the Transaction Proposal. Our Initial Stockholders have agreed to vote their shares of Common Stock in favor of the Transaction Proposal.

The approval of the NYSE Proposal requires the affirmative vote of holders of at least a majority of the votes cast by holders of outstanding shares of our Common Stock represented in person via the virtual meeting platform or by proxy and entitled to vote thereon at the Special Meeting. Failure to vote by proxy or to vote in person via the virtual meeting platform at the Special Meeting and broker non-votes will have no effect on the NYSE Proposal. Abstentions will be counted in connection with the determination of whether a valid quorum is established but will have no effect on the NYSE Proposal.

The approval of the Charter Proposal requires (i) the affirmative vote of holders of a majority of our outstanding shares of Common Stock entitled to vote thereon at the Special Meeting and (ii) the affirmative vote of holders of a majority of our outstanding shares of Class B Stock, voting separately as a single class, entitled to vote thereon at the Special Meeting. Accordingly, a dMY stockholder’s failure to vote by proxy or to vote in person via the virtual meeting platform at the Special Meeting, as well as an abstention from voting and a broker non-vote with regard to the Charter Proposal will have the same effect as a vote “AGAINST” such Charter Proposal.

The approval of the Governance Proposals requires the affirmative vote of a majority of the votes cast by holders of our outstanding shares of Common Stock represented in person via the virtual meeting platform or by proxy and entitled to vote thereon at the Special Meeting. Accordingly, a stockholder’s failure to vote by proxy or to vote in person via the virtual meeting platform at the Special Meeting, as well as a broker non-vote with regard to

 

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the Governance Proposals will have no effect on the Governance Proposals. Abstentions will be counted in connection with the determination of whether a valid quorum is established but will have no effect on the Governance Proposals.

The approval of this Equity Incentive Plan Proposal requires the affirmative vote of a majority of the votes cast by holders of our outstanding shares of Common Stock represented in person via the virtual meeting platform or by proxy and entitled to vote at the Special Meeting. Accordingly, a stockholder’s failure to vote by proxy or to vote in person via the virtual meeting platform at the Special Meeting, as well as a broker non-vote with regard to the Equity Incentive Plan Proposal will have no effect on the Equity Incentive Plan Proposal. Abstentions will be counted in connection with the determination of whether a valid quorum is established but will have no effect on the Equity Incentive Plan Proposal.

The approval of the Employee Stock Purchase Plan Proposal requires the affirmative vote of a majority of the votes cast by holders of our outstanding shares of Common Stock represented in person via the virtual meeting platform or by proxy and entitled to vote at the Special Meeting. Accordingly, a stockholder’s failure to vote by proxy or to vote in person via the virtual meeting platform at the Special Meeting, as well as a broker non-vote with regard to the Employee Stock Purchase Plan Proposal will have no effect on the Employee Stock Purchase Plan Proposal. Abstentions will be counted in connection with the determination of whether a valid quorum is established but will have no effect on the Employee Stock Purchase Plan Proposal.

If a quorum is present, directors are elected by a plurality of the votes cast, via the virtual meeting platform or by proxy. This means that the five director nominees who receive the most affirmative votes will be elected. Votes marked “FOR” a nominee will be counted in favor of that nominee. Proxies will have full discretion to cast votes for other persons in the event any nominee is unable to serve. Failure to vote by proxy or to vote in person via the virtual meeting platform at the Special Meeting, abstentions and broker non-votes will have no effect on the vote.

The approval of the Adjournment Proposal requires the affirmative vote of a majority of the votes cast by holders of outstanding shares of our Common Stock represented in person via the virtual meeting platform or by proxy and entitled to vote thereon at the Special Meeting. Accordingly, a stockholder’s failure to vote by proxy or to vote in person via the virtual meeting platform at the Special Meeting, as well as a broker non-vote with regard to the Adjournment Proposal will have no effect on the Adjournment Proposal. Abstentions will be counted in connection with the determination of whether a valid quorum is established but will have no effect on the Adjournment Proposal.

It is important for you to note that, in the event that Transaction Proposal, the NYSE Proposal or the Charter Proposal do not receive the requisite vote for approval, we will not consummate the Business Combination. If we do not consummate the Business Combination, we may fail to complete an initial business combination by November 17, 2022, and will be required to dissolve and liquidate the Trust Account by returning the then remaining funds in such account to the public stockholders.

Recommendation to Company Stockholders

Our Board believes that each of the Transaction Proposal, the NYSE Proposal, the Charter Proposal, the Governance Proposals, the Equity Incentive Plan Proposal, the Employee Stock Purchase Plan Proposal and the Adjournment Proposal to be presented at the Special Meeting is in the best interests of dMY and its stockholders and unanimously recommends that its stockholders vote “FOR” each of the proposals.

When you consider the recommendation of our Board in favor of approval of the Transaction Proposal, you should keep in mind that Initial Stockholders and certain other members of our Board and officers of dMY have interests in the Business Combination that are different from or in addition to (or which may conflict with) your interests as a stockholder. Stockholders should take these interests into account in deciding whether to approve

 

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the proposals presented at the Special Meeting, including the Transaction Proposal. These interests include, among other things:

 

   

the fact that our Initial Stockholders have agreed not to redeem any of the Founder Shares in connection with a stockholder vote to approve a proposed initial business combination;

 

   

the fact that on September 14, 2020, the Sponsor subscribed for 7,187,500 Founder Shares for a total subscription price of $25,000, and fully paid for these on November 17, 2020. In October 2020, the Sponsor transferred 25,000 Founder Shares to each of Darla Anderson, Francesca Luthi and Charles E. Wert, dMY’s directors. On November 12, 2020, dMY effected a 1:1.1 stock split of the Founder Shares, resulting in an aggregate of 7,906,250 shares outstanding. After giving effect to the forfeiture of 406,250 Founder Shares on November 17, 2020, the remaining 7,500,000 Founder Shares will have a significantly higher value at the time of the Business Combination, which if unrestricted and freely tradable (and subject to the vesting of all Vesting Shares) would be valued at approximately $75 million but, given the restrictions on such shares, we believe such shares have less value;

 

   

the fact that our Initial Stockholders have agreed to waive their rights to liquidating distributions from the Trust Account with respect to their Founder Shares if we fail to complete an initial business combination by November 17, 2022;

 

   

the fact that the Sponsor paid an aggregate of approximately $8 million for its 4,000,000 Private Warrants to purchase shares of Class A Stock and that such Private Warrants will expire worthless if a business combination is not consummated by November 17, 2022. The Private Warrants would have had an aggregate market value of $         based upon the closing price of $         per Public Warrant on the NYSE on                 , 2021, the most recent practicable date prior to the date of this proxy statement/prospectus. If the Business Combination is not consummated, our Sponsor will lose any theoretical gain on the shares underlying the Private Warrants;

 

   

the fact that the Sponsor paid an aggregate of $25,000 for the Founder Shares, and upon the completion of the Business Combination, the Founder Shares will convert into Class A common stock at a conversion rate that entitles the Sponsor to own, in the aggregate, [3.65]% of the common stock of the Combined Company after giving effect to the Business Combination. As a result, our Sponsor ultimately expects to receive 7,425,000 shares of common stock of the Combined Company in connection with the conversion of the Founder Shares as part of the Business Combination and such securities will have a significantly higher value at the time of the Business Combination which, if unrestricted and freely tradable, would be valued at approximately $        , based upon the closing price of $         per public share on the NYSE on                 , 2021, the most recent practicable date prior to the date of this proxy statement/prospectus, resulting in a theoretical gain of $        , but, given the lock-up restrictions on such shares, we believe such shares have less value. If the Business Combination is not consummated, our Sponsor will lose any theoretical gain on its shares;

 

   

the fact that each of our independent directors currently holds 25,000 Founder Shares and expects to receive 25,000 shares of common stock of the Combined Company in connection with the conversion of the Founder Shares as part of the Business Combination. The 75,000 shares of common stock of the Combined Company expected to be owned by our independent directors would have had an aggregate market value of $        based upon the closing price of $         per public share on the NYSE on                 , 2021, the most recent practicable date prior to the date of this proxy statement/prospectus;

 

   

the continued right of the Sponsor to hold Class A Stock and the shares of Class A Stock to be issued to the Sponsor upon exercise of its Private Warrants following the Business Combination, subject to certain lock-up periods;

 

   

if the Trust Account is liquidated, including in the event we are unable to complete an initial business combination within the required time period, the Sponsor has agreed to indemnify us to ensure that the proceeds in the Trust Account are not reduced below $10.00 per Public Share, or such lesser per Public Share amount as is in the Trust Account on the liquidation date, by the claims of prospective target businesses with which we have entered into an acquisition agreement or claims of any third party (other than our independent public accountants) for services rendered or products sold to us, but only if such a vendor or target business has not executed a waiver of any and all rights to seek access to the Trust Account;

 

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

 

   

the fact that the holders of Founder Shares, Private Warrants and warrants that may be issued upon conversion of certain working capital loans, if any, (and any shares of Class A Stock issuable upon the exercise of the Private Warrants) are entitled to registration rights pursuant to our existing registration rights agreement, to require us to register a sale of any of our securities held by them prior to the consummation of our initial business combination;

 

   

the fact that at the consummation of the Business Combination, we will enter into the Registration Rights Agreement with the Registration Rights Holders (in which certain members of our Board and affiliates are included), which provides for registration rights to Registration Rights Holders and their permitted transferees;

 

   

the fact that concurrently with the execution and delivery of the Merger Agreement, we have entered into the Sponsor Support Agreement with the Insiders the Sponsor and IonQ, pursuant to which the Insiders and the Sponsor have agreed to (i) vote all of their shares (and their permitted transferees will agree to vote all of their shares) of Class A Stock and Class B Stock in favor of the proposals listed herein, which shares represent 20% of the outstanding shares of Class A Stock on an as-converted basis, (ii) not redeem any of the shares of dMY stock owned by such holder in connection with the stockholder approvals contemplated hereby and (iii) certain restrictions on certain of their shares of Class B Stock. Under the Sponsor Support Agreement, the Sponsor and each of the Insiders agrees that, effective upon the consummation of the Business Combination, 10% of the Founder Shares (750,000 shares), which will be converted into shares of Class A Stock at the consummation of the Business Combination, shall be unvested and shall be subject to certain vesting and forfeiture provisions;

 

   

the fact that the Sponsor and its affiliates can earn a positive rate of return on their investment, even if other stockholders experience a negative rate of return in the post-business combination company;

 

   

the fact that the Sponsor, officers and directors will lose their entire investment of approximately $7,525,000 in us and will not be reimbursed for any loans extended, fees due or out-of-pocket expenses if an initial business combination is not consummated by November 17, 2022; and

 

   

the fact that the Sponsor and members of our current Board and management would hold the following number of shares in the Combined Company at the consummation of the Business Combination:

 

Name of Person/Entity

   Shares of
Class A
Stock(1)
     Value of
Class A Stock(3)
 

dMY Sponsor III, LLC (the Sponsor)(2)

     7,425,000      $ 74,250,000  

Harry L. You(2)

     7,425,000      $ 74,250,000  

Niccolo de Masi(2)

     —          —    

Darla Anderson(2)

     25,000      $ 250,000  

Francesca Luthi(2)

     25,000      $ 250,000  

Charles E. Wert(2)

     25,000      $ 250,000  

 

(1) 

Interests shown consist solely of Founder Shares, classified as Class B common stock. Such shares will automatically convert into Class A common stock concurrently with or immediately following the consummation of the Business Combination on a one-for-one basis, subject to adjustment. Share amounts are subject to the full vesting of the Vesting Shares.

(2) 

dMY Sponsor III, LLC is the record holder of the shares reported herein. Each of our officers and directors are among the members of dMY Sponsor III, LLC and Mr. You is the manager of dMY Sponsor III, LLC. Mr. You has voting and investment discretion with respect to the common stock held of record by dMY Sponsor III, LLC. Each of our officers and directors other than Mr. You disclaims any beneficial ownership of any shares held by dMY Sponsor III, LLC.

(3) 

Assumes a value of $10.00 per share, the deemed value of the Class A Stock in the Business Combination.

 

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Broker Non-Votes and Abstentions

Abstentions are considered present for the purposes of establishing a quorum. For purposes of approval, a failure to vote or an abstention will have no effect on the Transaction Proposal, the NYSE Proposal, the Governance Proposals, the Equity Incentive Plan Proposal, the Employee Stock Purchase Plan Proposal and the Adjournment Proposal, but a failure to vote or abstention will have the same effect as a vote “AGAINST” the Charter Proposal. In general, if your shares are held in “street” name and you do not instruct your broker, bank or other nominee on a timely basis on how to vote your shares, your broker, bank or other nominee, in its sole discretion, may either leave your shares unvoted or vote your shares on routine matters, but not on any non-routine matters.

None of the proposals at the Special Meeting are routine matters. As such, without your voting instructions, your brokerage firm cannot vote your shares on any proposal to be voted on at the Special Meeting.

Voting Your SharesStockholders of Record

If you are a dMY stockholder of record, you may vote by mail or you can attend the Special Meeting in person via the virtual meeting platform and vote during the meeting by following the instructions on your proxy card. Each share of Common Stock that you own in your name entitles you to one vote on each of the proposals for the Special Meeting. Your one or more proxy cards show the number of shares of Common Stock that you own.

Voting by Mail. You can vote your shares by completing, signing, dating and returning the enclosed proxy card in the postage-paid envelope provided. By signing the proxy card and returning it in the enclosed prepaid and addressed envelope, you are authorizing the individuals named on the proxy card to vote your shares at the Special Meeting in the manner you indicate. You are encouraged to sign and return the proxy card even if you plan to attend the Special Meeting so that your shares will be voted if you are unable to attend the Special Meeting. If you receive more than one proxy card, it is an indication that your shares are held in multiple accounts. Please sign and return all proxy cards to ensure that all of your shares are voted. If you hold your shares in “street name” through a bank, broker or other nominee, you will need to follow the instructions provided to you by your bank, broker or other nominee to ensure that your shares are represented and voted at the Special Meeting. If you sign and return the proxy card but do not give instructions on how to vote your shares, your shares of Common Stock will be voted as recommended by our Board. Our Board recommends voting “FOR” the Transaction Proposal, “FOR” the NYSE Proposal, “FOR” the Charter Proposal, “FOR” each of the Governance Proposals, “FOR” the Equity Incentive Plan Proposal, “FOR” the Employee Stock Purchase Plan Proposal and “FOR” the Adjournment Proposal. Votes submitted by mail must be received by 11:59 p.m. on             , 2021.

Voting via the Virtual Meeting Platform. You can attend the Special Meeting in person via the virtual meeting platform and vote during the meeting by following the instructions on your proxy card. You can access the Special Meeting by visiting the website                 . You will need your control number for access. If you do not have a control number, please contact the Trustee. Instructions on how to attend and participate at the Special Meeting are available at                 . If you hold your shares in “street name,” which means your shares are held of record by a broker, bank or other nominee, you should follow the instructions provided by your broker, bank or nominee to ensure that votes related to the shares you beneficially own are properly counted. In this regard, you must provide the record holder of your shares with instructions on how to vote your shares. However, if your shares are held in the name of your broker, bank or other nominee, you must get a proxy from the broker, bank or other nominee. That is the only way we can be sure that the broker, bank or nominee has not already voted your shares of Common Stock.

Voting Your SharesBeneficial Owners

If your shares are held in an account at a brokerage firm, bank or other nominee, then you are the beneficial owner of shares held in “street name” and this proxy statement/prospectus is being sent to you by that broker, bank or other nominee. The broker, bank or other nominee holding your account is considered to be the stockholder of record for purposes of voting at the Special Meeting. As a beneficial owner, you have the right to direct your broker, bank or other nominee regarding how to vote the shares in your account by following the instructions that the broker, bank or other nominee provides you along with this proxy statement/prospectus. As a beneficial owner, if you wish to vote at the Special Meeting, you must get a proxy from the broker, bank or other nominee. Please see “Special Meeting of the Stockholders of dMYAttending the Special Meeting.”

 

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Attending the Special Meeting

Only dMY stockholders on the record date or their legal proxyholders may attend the Special Meeting. Please note that you will only be able to access the Special Meeting by means of remote communication. Please have your Control Number, which can be found on your proxy card, to join the Special Meeting. If you do not have a control number, please contact the Continental Stock Transfer Company, the Transfer Agent.

Revoking Your Proxy

If you give a proxy, you may revoke it at any time before the Special Meeting or at the Special Meeting by doing any one of the following:

 

   

you may send another proxy card with a later date;

 

   

you may notify our Secretary in writing to dMY Technology Group, Inc. III, 1180 North Town Center Drive, Suite 100, Las Vegas, Nevada 89144, before the Special Meeting that you have revoked your proxy; or

 

   

you may attend the Special Meeting, revoke your proxy, and vote in person via the virtual meeting platform, as indicated above.

No Additional Matters

The Special Meeting has been called only to consider the approval of the Transaction Proposal, the NYSE Proposal, the Charter Proposal, the Governance Proposals, the Equity Incentive Plan Proposal, the Employee Stock Purchase Plan Proposal and the Adjournment Proposal. Under our current bylaws, other than procedural matters incident to the conduct of the Special Meeting, no other matters may be considered at the Special Meeting if they are not included in this proxy statement/prospectus, which serves as the notice of the Special Meeting.

Who Can Answer Your Questions About Voting

If you have any questions about how to vote or direct a vote in respect of your shares of Common Stock, you may call Morrow Sodali, our proxy solicitor, at (866) 662-5200, or banks and brokerage firms, please call collect at (203) 658-9400.

Redemption Rights

Pursuant to the Current Charter, any holders of Public Shares may demand that such shares be redeemed in exchange for a pro rata share of the aggregate amount on deposit in the Trust Account, less taxes payable, calculated as of two business days prior to the consummation of the Business Combination. If demand is properly made and the Business Combination is consummated, these shares, immediately prior to the Business Combination, will cease to be outstanding and will represent only the right to receive a pro rata share of the aggregate amount on deposit in the Trust Account which holds the proceeds of the dMY IPO (calculated as of two business days prior to the consummation of the Business Combination, less taxes payable). For illustrative purposes, based on the balance of our Trust Account of $300,077,389 as of March 31, 2021, the estimated per share redemption price would have been approximately $10.00.

In order to exercise your redemption rights, you must:

 

   

if you hold Public Units, separate the underlying Public Shares and Public Warrants;

 

   

check the box on the enclosed proxy card marked “Stockholder Certification” if you are not acting in concert or as a “group” (as defined in Section 13d-3 of the Exchange Act) with any other stockholder with respect to Public Shares;

 

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prior to 5:00 P.M., Eastern time on             , 2021 (two business days before the Special Meeting), tender your shares physically or electronically and submit a request in writing that we redeem your Public Shares for cash to Continental Stock Transfer & Trust Company, the Transfer Agent, at the following address:

Continental Stock Transfer & Trust Company

1 State Street 30th Floor

New York, New York 10004

Attention: Mark Zimkind

Email: mzimkind@continentalstock.com

 

   

deliver your Public Shares either physically or electronically through DTC’s DWAC system to the Transfer Agent at least two business days before the Special Meeting. Stockholders seeking to exercise their redemption rights and opting to deliver physical certificates should allot sufficient time to obtain physical certificates from the Transfer Agent and time to effect delivery. Stockholders should generally allot at least two weeks to obtain physical certificates from the Transfer Agent. However, it may take longer than two weeks. Stockholders who hold their shares in street name will have to coordinate with their bank, broker or other nominee to have the shares certificated or delivered electronically. If you do not submit a written request and deliver your Public Shares as described above, your shares will not be redeemed.

Stockholders seeking to exercise their redemption rights, whether they are record holders or hold their shares in “street name” are required to either tender their certificates to the Transfer Agent prior to the date set forth in this proxy statement/prospectus, or up to two business days prior to the vote on the proposal to approve the Business Combination at the Special Meeting, or to deliver their shares to the Transfer Agent electronically using DTC’s DWAC system, at such stockholder’s option. The requirement for physical or electronic delivery prior to the Special Meeting ensures that a redeeming stockholder’s election to redeem is irrevocable once the Business Combination is approved.

Holders of outstanding Public Units must separate the underlying Public Shares and Public Warrants prior to exercising redemption rights with respect to the Public Shares.

If you hold Public Units registered in your own name, you must deliver the certificate for such Public Units to Continental Stock Transfer & Trust Company, the Transfer Agent, with written instructions to separate such Public Units into Public Shares and Public Warrants. This must be completed far enough in advance to permit the mailing of the Public Share certificates back to you so that you may then exercise your redemption rights upon the separation of the Public Shares from the Public Units.

If a broker, dealer, commercial bank, trust company or other nominee holds your Public Units, you must instruct such nominee to separate your Public Units. Your nominee must send written instructions by facsimile to Continental Stock Transfer & Trust Company, the Transfer Agent. Such written instructions must include the

number of Public Units to be split and the nominee holding such Public Units. Your nominee must also initiate electronically, using DTC’s DWAC system, a withdrawal of the relevant Public Units and a deposit of an equal number of Public Shares and Public Warrants. This must be completed far enough in advance to permit your nominee to exercise your redemption rights upon the separation of the Public Shares from the Public Units.

While this is typically done electronically on the same business day, you should allow at least two full business days to accomplish the separation. If you fail to cause your Public Units to be separated in a timely manner, you will likely not be able to exercise your redemption rights.

Each redemption of shares of Class A Stock by our public stockholders will reduce the amount in our Trust Account, which had a balance of $300,077,389 as of March 31, 2021. In no event will we redeem shares of Class A Stock in an amount that would result in dMY’s failure to have net tangible assets equaling or exceeding $5,000,001.

 

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Prior to exercising redemption rights, stockholders should verify the market price of Class A Stock as they may receive higher proceeds from the sale of their Class A Stock in the public market than from exercising their redemption rights if the market price per share is higher than the redemption price. We cannot assure you that you will be able to sell your shares of Class A Stock in the open market, even if the market price per share is higher than the redemption price stated above, as there may not be sufficient liquidity in Class A Stock when you wish to sell your shares.

If you exercise your redemption rights, your shares of Class A Stock will cease to be outstanding immediately prior to the Business Combination and will only represent the right to receive a pro rata share of the aggregate amount on deposit in the Trust Account. You will no longer own those shares and will have no right to participate in, or have any interest in, the future growth of the Combined Company, if any. You will be entitled to receive cash for these shares only if you properly and timely demand redemption.

If the Business Combination is not approved and we do not consummate an initial business combination by November 17, 2022, we will be required to dissolve and liquidate our Trust Account by returning the then remaining funds in such account to the public stockholders and our warrants will expire worthless.

Appraisal Rights

Appraisal rights or dissenters’ rights are not available to holders of shares of Common Stock in connection with the Business Combination.

Proxy Solicitation Costs

We are soliciting proxies on behalf of our Board. This proxy solicitation is being made by mail, but also may be made by telephone or in person. We have engaged Morrow Sodali to assist in the solicitation of proxies for the Special Meeting. We and our directors, officers and employees may also solicit proxies in person. We will ask banks, brokers and other institutions, nominees and fiduciaries to forward this proxy statement/prospectus and the related proxy materials to their principals and to obtain their authority to execute proxies and voting instructions.

We will bear the entire cost of the proxy solicitation, including the preparation, assembly, printing, mailing and distribution of this proxy statement/prospectus and the related proxy materials. We have agreed to pay Morrow Sodali a fee of $25,000, plus disbursements, and will reimburse Morrow Sodali for its reasonable out-of-pocket expenses and indemnify Morrow Sodali and its affiliates against certain claims, liabilities, losses, damages and expenses. We will reimburse brokerage firms and other custodians for their reasonable out-of-pocket expenses for forwarding this proxy statement/prospectus and the related proxy materials to dMY stockholders. Our directors, officers and employees who solicit proxies will not be paid any additional compensation for soliciting.

 

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THE BUSINESS COMBINATION

The following is a discussion of the merger and the material terms of the merger agreement among dMY, Merger Sub and IonQ. You are urged to read carefully the merger agreement in its entirety, a copy of which is attached as Annex A to this proxy statement/prospectus. This summary does not purport to be complete and may not contain all of the information about the merger agreement that is important to you. We encourage you to read the merger agreement carefully and in its entirety. This section is not intended to provide you with any factual information about dMY or IonQ. Such information can be found elsewhere in this proxy statement/prospectus.

Terms of the Merger

Transaction Structure

We are a blank check company incorporated in Delaware on September 14, 2020. dMY was formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses. The entry into the Merger Agreement and the business combination was the result of an extensive search for a potential transaction utilizing the sourcing platform and investing and operating experience of our management team, the Sponsor and the Board. The terms of the Merger Agreement were the result of extensive negotiations between our management team, the Sponsor, our independent directors and representatives of IonQ. The following is a brief description of the background of these negotiations, the merger and related transactions.

On November 12, 2020, dMY’s registration statement for its IPO became effective.

On November 17, 2020, dMY closed its IPO and concurrent private placement of the Private Warrants. Upon the closing of the IPO and the private placement, $300.0 million of the net proceeds of the IPO and certain of the proceeds of the private placement were placed in a trust account located in the United States with Continental Stock Transfer & Trust Company acting as trustee, and invested only in United States “government securities” within the meaning of Section 2(a)(16) of the Investment Company Act 1940, as amended (the “Investment Company Act”) having a maturity of 185 days or less or in money market funds meeting certain conditions under Rule 2a-7 promulgated under the Investment Company Act which invest only in direct U.S. government treasury obligations, until the earlier of: (i) the completion of a business combination and (ii) the distribution of the trust account in connection with a liquidation of dMY. Prior to the consummation of dMY’s IPO, neither dMY, nor anyone on its behalf, had any substantive discussions, formal or otherwise, with respect to a transaction with dMY.

After dMY completed its IPO, dMY commenced an active search for prospective businesses and assets to acquire in our initial business combination. The Board and dMY management have substantial experience in evaluating the operating and financial merits of companies from a wide range of industries, including the technology sector. As such, the members of the Board and dMY management team believe that they are qualified to conduct and analyze the due diligence required for us to identify a merger partner. See the section entitled “Management of dMY” for additional information regarding the experience of the Board and dMY management team.

Regularly scheduled daily meetings via teleconference were held by the Board in order to discuss our search for prospective businesses and assets to acquire in our initial business combination. Representatives of our management team contacted and were contacted by a number of individuals and entities with respect to acquisition opportunities. Also following the IPO, dMY engaged Cleary Gottlieb Steen & Hamilton LLP (“Cleary”) to provide dMY with legal counsel in connection with a potential business combination.

We initially focused our efforts on identifying businesses within the broader consumer technology ecosystem that are either consumer-facing or support the infrastructure of consumer applications, although we were not required to limit our activities to any particular industry. In the evaluation of business combination partners, the Board and

 

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management team considered a wide variety of complex factors. The Board did not consider it practicable or relevant to quantify or otherwise assign relative weights to the specific factors it considered in reaching its final decision. In evaluating potential businesses and assets to acquire, the Board considered acquisition candidates, utilizing its extensive network of contacts for introductions to potential targets as well as dMY’s knowledge of the private company marketplace. dMY only evaluated technology companies, and as stated in dMY’s IPO prospectus, dMY generally focused on targets that fit some or all of the following criteria:

 

   

had an enterprise value between $1 billion and $3 billion;

 

   

developing disruptive and key enablement technologies, such as artificial intelligence, machine learning, cloud computing or quantum computing sectors;

 

   

had a proven and accomplished management team;

 

   

had the requisite compliance, financial controls and reporting processes in place and were ready for the regulatory requirements of a public entity;

 

   

had a promising growth path, driven by a sustainable competitive advantage, with opportunities for acceleration through a partnership with dMY;

 

   

had a management team with the ability to execute on strategic opportunities, including accretive acquisitions of companies that have the potential to enhance shareholder value;

 

   

had management and stakeholders who aspire to have their company become a public entity and generate substantial growth;

 

   

had a sizable market share in their segment and the opportunity to achieve market leadership; and/or

 

   

had defensible proprietary technology and intellectual property rights.

Our management team employed various strategies in an effort to identify an appropriate target company, including:

 

   

contacting investment bankers, attorneys, accountants, venture capital funds, private equity funds, leveraged buyout funds, management buyout funds, brokers and other members of the financial community and corporate executives;

 

   

contacting investment banks that might be working with companies looking for exits or funding;

 

   

contacting private equity and venture capital investment firms that might have portfolio companies they are looking to exit;

 

   

coordinating with our officers and directors, as well as their affiliates, to identify target business candidates of which they become aware through their contacts; and

 

   

conducting Internet research and following companies that fit our target criteria that might be looking for funding or a sale.

Since the IPO through December 11, 2020, when we entered into an exclusivity arrangement with IonQ, dMY’s management team and the Board:

 

   

considered and analyzed approximately 12 potential acquisition targets other than IonQ (the “Other Potential Targets”), including having and conducting meetings and calls with representatives of six of the Other Potential Targets;

 

   

considered five Other Potential Target businesses in greater detail, referred to herein as “Target A,” “Target B,” “Target C,” “Target D” and “Target E,” each of which was either an artificial intelligence, cloud computing, quantum computing technology company, fintech or marketplaces company;

 

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signed non-disclosure agreements with three of the Other Potential Targets with which dMY held further discussions, which contained customary terms regarding protections of confidentiality but did not impose conditions of exclusivity or other similarly restrictive provisions or standstills; and

 

   

delivered a non-binding indication of interest to Target B.

Following our due diligence process with respect to the Other Potential Targets, we determined not to further pursue a transaction with Target A or Target D because dMY determined, in consultation with its industry and academic networks, that such Other Potential Targets were unlikely to hit their technical milestones, which was a critical factor for dMY in considering pre-revenue target companies. dMY determined not to proceed with Target B or Target C due to challenges presented in structuring and consummating a transaction with those counterparties, based on their ownership and jurisdictions of operation. dMY determined, after discussions with Target E’s principals, that Target E had valuation expectations that dMY believed would not be supported by public market shareholders. Ultimately, the Board determined that IonQ presented the most compelling target for a business combination due to its strong management team and business prospects, as well as the valuation and the likelihood of successfully consummating a transaction. The Board was also focused on IonQ’s ability to become an industry leader in quantum computing, which has the potential to be revolutionary in a variety of fields, including machine learning, solar energy production, finance, electric vehicles, material science, aerospace, logistics and drug discovery. The Board noted in particular that IonQ’s technology has significant advantages over existing competitors that are expected to allow IonQ’s technology to outperform the competition in the future.

On November 13, 2020, Mr. de Masi emailed Mr. Chapman, to whom he had been introduced through a mutual friend during the summer of 2020, to see whether IonQ would be interested in signing a confidentiality agreement in order to further discuss IonQ’s business. IonQ had previously entered into a confidentiality agreement with dMY Technology Group, Inc. II, a blank check company previously formed by an affiliate of the Sponsor. Mr. de Masi’s November 13, 2020 email included an initial draft of a confidentiality agreement, which, following negotiations between the parties, was executed on November 16, 2020, on customary terms restricting dMY’s use and disclosure of information with respect to IonQ for a specified term, with such information required to be returned or destroyed upon termination thereof and without otherwise restricting dMY’s activities through a standstill, non-solicitation or any similar provision. Following the execution of the confidentiality agreement on November 16, 2020, dMY was granted access to IonQ’s electronic dataroom, which included certain financial forecasts and a management presentation that detailed IonQ’s technology, business model, and future growth prospects.

Following the execution of the confidentiality agreement and commencement of due diligence, dMY had various negotiations with IonQ around valuation, funding requirements, PIPE Investment size, sponsor equity, and board composition post a business combination, and Mr. You and Mr. de Masi, discussed the management presentation and a prospective transaction capital structure and prepared a letter of intent.

In the evening of November 16, 2020, dMY, provided an initial draft of a non-binding letter of intent to IonQ. The initial draft letter of intent outlined the structure of a possible transaction, and proposed that the valuation of IonQ be determined in connection with discussions with prospective investors in the PIPE Investment.

On December 4, 2020, Mr. Chapman informed dMY that the IonQ board was focused on structuring the valuation and terms of any SPAC business combination transaction to allow the existing stockholders of IonQ to retain at least 70% ownership of the combined company in a SPAC business combination.

On December 5, 2020, dMY, provided an updated draft of its non-binding letter of intent to IonQ. The updated draft letter of intent proposed an equity valuation of IonQ of $1.2 billion, contemplated a PIPE Investment of $150 million and a minimum cash condition exactly equivalent to the committed capital raised in the PIPE Investment. The letter of intent proposed that the board of directors for the combined company would have a number and composition of directors as shall be mutually agreed by IonQ Sellers and dMY, and would include each of Mr. You and Mr. de Masi as initial members of the board, in different classes of the board.

 

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On December 17, 2020, IonQ entered into an agreement with Morgan Stanley & Co. LLC (“Morgan Stanley”) confirming IonQ’s engagement with Morgan Stanley as financial advisor in connection with the Business Combination. In addition, on December 21, 2020, dMY engaged Goldman Sachs & Co. LLC (“Goldman Sachs”), who previously served as lead underwriter in dMY’s IPO, to act as financial advisor to dMY in connection with the Business Combination.

From December 5, 2020, through December 10, 2020, dMY and IonQ held telephonic discussions regarding the key terms of the letter of intent, through their management teams and through representatives at Goldman Sachs and Morgan Stanley. Key areas of negotiation included the equity value of IonQ, the forfeiture and/or re-vesting of Sponsor equity, the size of the PIPE Investment and the amount of the “minimum cash” condition to the obligations of IonQ to consummate the Business Combination.

On December 8, 2020, following discussions with its financial advisors and its legal counsel, Cooley LLP, IonQ sent a revised draft of the letter of intent to dMY, which reflected the inclusion of a potential additional “earn out” increase to the consideration payable to IonQ’s stockholders if the stock price of the Combined Company exceeded certain targets, provisions with respect to the forfeiture and vesting of Sponsor equity and a minimum cash condition of $300 million. The revised letter of intent also included a proposal for the board of directors of the Combined Company that would include one or two designees of the Sponsor, a more detailed summary of the terms of the proposed acquisition agreement, including, among other things, that the transaction would be effected a non-recourse basis without the survival of any representations or warranties or any post-closing indemnification or adjustments.

On December 9, 2020, dMY sent a revised draft of the letter of intent to IonQ, which provided for, among other things, an increase in the equity valuation of IonQ to $1.275 billion, acceptance of the proposed non-recourse construct for the acquisition agreement, the deletion of the “earn out” and the provisions with respect to the forfeiture and vesting of Sponsor equity and a minimum cash condition of $225 million.

On December 10, 2020, IonQ sent a revised draft of the letter of intent to dMY which reflected, among other things, a revised position with respect to the vesting of Sponsor equity.

On December 10, 2020, dMY held a special meeting of the Board via teleconference. Mr. de Masi summarized for the Independent Directors the negotiations and iterations that had occurred, including with respect to the valuation of IonQ, the treatment of the Sponsor shares and warrants, the minimum cash condition for closing, the proposed size of the PIPE Investment, the composition of the board of directors of the Combined Company, and the exclusivity period under the letter of intent.

At the December 10, 2020 meeting, Mr. de Masi also outlined a number of potential alternative targets in areas including fintech and marketplaces. Mr. You, the chairman of the Board, discussed the macro environment and dMY’s unique ability to potentially bring strategic PIPE Investors into the transaction to support long-term shareholder momentum. The Board discussed the potential strategic benefits of being the world’s first public company in a certain category, which had been a successful approach for other SPAC business combinations based on the Board’s review of publicly announced SPAC transactions over the preceding 18 months. The Board agreed to proceed with exploring a business combination with IonQ, and that the opportunity justified entering into mutual exclusivity between dMY and IonQ for 75 days. A vote was held and the Board authorized the exclusivity period and the entry into the letter of intent with IonQ. The Board also authorized Mr. You to enter into an engagement letter with a financial advisor with respect to the potential transaction with IonQ.

On December 11, 2020, dMY and IonQ entered into the letter of intent.

From December 11, 2020 until the signing of the Merger Agreement on March 7, 2021, dMY management reported regularly to the Board on the status of its due diligence investigation with respect to IonQ and its negotiation of the Merger Agreement and the PIPE Investment.

 

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On December 18, 2020, representatives of dMY and Cleary were granted access to the online data room set up by IonQ for the proposed transaction. On December 23, 2020, Cleary sent an initial legal due diligence request list to Cooley. From December 18, 2020, through the signing of the Merger Agreement, dMY and its legal advisors at Cleary and at Wolf, Greenfield & Sacks, P.C. (which was engaged to conduct legal due diligence with respect to IonQ’s patent portfolio) conducted a legal diligence review of materials provided in the online data room, and requested further diligence information through written requests and during telephone calls among certain members of IonQ’s management and its legal and financial advisors and representatives of dMY.

On December 21, 2020, dMY engaged Goldman Sachs to serve as co-placement agent for the PIPE Investment. Goldman Sachs will receive fees and expense reimbursements in connection therewith. Goldman Sachs has also provided the Board with a disclosure letter describing the various roles that Goldman Sachs has served in with IonQ and any other material relationships that Goldman Sachs has with the IonQ. dMY considered another potential financial advisor, but ultimately decided to engage Goldman Sachs due to its familiarity with dMY and its experience in past transactions that the Board considered relevant to the potential transaction with IonQ.

On January 4, 2021, Cleary provided an initial draft of the Merger Agreement to Cooley.

On January 5, 2021, representatives of dMY and IonQ had a telephone call to discuss the PIPE investment, including potential investors and a proposed investor presentation. Morgan Stanley and Goldman Sachs personnel were on the call.

From January 5, 2021 through March 5, 2021, IonQ and dMY held check-in calls to discuss the timeline and the Subscription Agreements. From January 5, 2021 to January 28, 2021 dMY and IonQ rehearsed their private placement presentation and revised the presentation.

On January 14, 2021, Cleary and Cooley held a conference call to discuss the subscription document.

From January 14, 2021 through March 5, 2021, dMY’s advisors engaged in calls and correspondence with potential strategic investors in the PIPE Investment and their respective counsel. During this period, dMY and IonQ discussed the terms of such strategic investors’ investment in the PIPE Investment and negotiated the terms of the subscription agreements of such investors. The terms of such strategic investors’ subscription agreements were finalized on March 5, 2021. A principal issue for the subscription agreements for strategic investors was the inclusion of lock-up provisions.

On January 21, 2021, dMY engaged Morgan Stanley to serve as co-placement agent for the PIPE Investment. Morgan Stanley will receive fees and expense reimbursements in connection therewith. In addition, dMY and IonQ each signed a consent letter with Morgan Stanley acknowledging Morgan Stanley’s roles as financial advisor to IonQ in connection with the Business Combination and as co-placement agent to dMY in connection with the PIPE Investment and waiving any potential conflicts in connection with such dual roles. The consent letters and the fact of Morgan Stanley’s roles as financial advisor to IonQ in connection with the Business Combination and as co-placement agent to dMY in connection with the PIPE Investment were also reviewed and approved by the board of directors of each of IonQ and dMY.

On January 22, 2021, Cooley provided a revised draft of the Merger Agreement to Cleary.

On January 27, 2021, Cleary provided a revised draft of the Merger Agreement to Cooley.

On February 2, 2021, representatives of Cleary and Cooley held a conference call to discuss key issues in the Merger Agreement, including, among other things, adjustments to IonQ’s equity value to reflect IonQ’s cash and debt positions, the treatment of transaction expenses, and the treatment of IonQ’s warrants.

On February 5, 2021, Cooley sent a revised draft of the Merger Agreement to Cleary, along with a draft of the stockholder support agreement. Between February 5, 2021 and the signing of the Merger Agreement, dMY and

 

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IonQ, and their representatives at Cleary and Cooley, respectively, exchanged and negotiated drafts of the stockholder support agreement.

On February 7, 2021, Cooley sent an email to Cleary containing requests for diligence information with respect to dMY. Cleary provided responses to the requests on behalf of dMY on February 23, 2021, and from February 23, 2021 until the signing of the Merger Agreement, Cleary provided further diligence information to Cooley in response to follow-up requests for additional information.

On February 8, 2021, dMY reached an agreement in principle with respect to the PIPE Investment with MSD Partners L.P. (“MSD”). The parties negotiated the subscription agreement from February 5, 2021 to February 8, 2021, which was later entered into on March 7, 2021.

On February 9, 2021, representatives of Cleary and Cooley held a telephone conference to discuss key issues in the Merger Agreement, including adjustments to IonQ’s equity value to reflect IonQ’s cash and debt positions, the treatment of transaction expenses, the dilutive effect of IonQ’s warrants, covenants relating to the preservation of IonQ’s intellectual property and IonQ’s consent rights with respect to the PIPE Investment.

On February 11, 2021, Cleary sent a revised draft of the Merger Agreement to Cooley, along with a draft of the sponsor support agreement. Between February 11, 2021 and the signing of the Merger Agreement, dMY and IonQ, and their representatives at Cleary and Cooley, respectively, exchanged and negotiated drafts of the sponsor support agreement.

On February 12, 2021, representatives of dMY held a telephonic meeting with representatives of IonQ to discuss the open issues on the Merger Agreement, including with respect to potential post-closing adjustments to the equity value and covenants relating to the preservation of IonQ’s intellectual property.

On February 14, 2021, Cleary sent a further revised draft of the Merger Agreement to Cooley reflecting dMY’s position following its discussions with IonQ on February 12.

On February 15, 2021 a draft subscription agreement for financial investors was made available in a virtual data room, together with the investor presentation, which included summary risk factors, and a roadshow video. Financial investors were given access to the virtual data room and provided comments to the subscription agreement from February 15, 2021 to March 6, 2021. The terms of such strategic investors’ subscription agreements were finalized on March 6, 2021 and dMY finalized and executed the subscription agreements from the financial investors on March 7, 2021.

On February 16, 2021, dMY finalized the private placement roadshow presentation for use with potential participants in the PIPE Investment. Private placement non-disclosure agreements were executed by certain participants and investors wall crossed. A data room was set up by dMY as well as a number of introductions made by IonQ to dMY for potential PIPE Investors.

On February 18, 2021, Cleary sent a draft form of the amended and restated registration rights agreement to Cooley. Between February 18, 2021 and the signing of the Merger Agreement, dMY and IonQ, and their representatives at Cleary and Cooley, respectively, exchanged and negotiated drafts of the form amended and restated registration rights agreement.

Also on February 18, 2021, dMY finalized its discussions with Hyundai Motor Company and Kia Motors Corporation (collectively “Hyundai”). The parties negotiated a subscription agreement and a collaboration framework agreement from February 2, 2021, to February 18, 2021. dMY and Hyundai signed the agreements on March 7, 2021.

On February 19, 2021, Cooley provided a revised draft of the Merger Agreement to Cleary.

 

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On February 20, 2021, Cooley provided Cleary with a draft of IonQ’s confidential disclosure schedules with respect to the Merger Agreement to Cleary. Cooley and Cleary continued to exchange and discuss further comments to IonQ’s disclosure schedules through the time the Merger Agreement was executed.

On February 22, 2021, Cleary sent a revised draft of the Merger Agreement to Cooley.

On February 23, 2021, dMY finalized its discussions with Breakthrough Energy Ventures II, L.P. (“BEV”). The parties negotiated the agreement from February 4, 2021, to February 23, 2021. dMY and BEV signed the subscription agreement on March 7, 2021.

On February 24, 2021, dMY engaged Needham & Company LLC (“Needham”) as placement agent for certain potential investors (the “other investors”) in the PIPE Investment. On February 26, 2021, Needham distributed a draft of the Subscription Agreement to the other investors. dMY received the executed subscription agreements from the other investors from March 2 to March 7, 2021.

On February 25, 2021, representatives of Cleary and Cooley held a telephonic meeting to discuss the open issues in the Merger Agreement. Also on February 25, 2021, Cooley sent a revised draft of the Merger Agreement to Cleary. Between February 25, 2021 and the signing of the Merger Agreement, representatives of Cleary and Cooley exchanged several further drafts of the Merger Agreement and other ancillary agreements and held several telephone conferences to discuss the resolution of the remaining negotiation issues.

On March 4, 2021, Cleary provided Cooley with a draft of dMY’s confidential disclosure schedules with respect to the Merger Agreement. Cooley and Cleary continued to exchange and discuss further comments to dMY’s disclosure schedules through the time the Merger Agreement was executed.

On March 6, 2021, dMY reached an agreement in principle with Silver Lake Partners VI DE (AIV) L.P. (“Silver Lake”). The parties negotiated a subscription agreement from January 16, 2021, to March 6, 2021. dMY and Silver Lake signed the subscription agreement on March 7, 2021.

On March 7, 2021, IonQ and dMY agreed on final allocations of the private placement. The roadshow presentation was finalized and agreed to on March 7, 2021.

On the afternoon of March 7, 2021, the Board met with representatives of Goldman Sachs and Cleary to discuss developments with respect to the negotiations with IonQ and preparation of final transaction documentation. Representatives of Cleary provided a review of the Board’s fiduciary duties in connection with the proposed transaction with IonQ. Cleary also provided a summary of the Merger Agreement and other ancillary agreements, the current drafts of which had been provided to the Board in advance of the meeting. Representatives of Goldman Sachs reviewed with the Board a summary of the financial aspects of the proposed transaction with IonQ, including a discussion of IonQ’s growth potential, a discussion of investor feedback, and a review of the PIPE Investment. At this meeting, the Board unanimously (i) declared the advisability of the Merger, the PIPE Investment and the other transactions contemplated by the Merger Agreement, (ii) determined that the Merger, the PIPE Investment and the other transactions contemplated by the Merger Agreement are in the best interests of the stockholders of dMY, (iii) determined that the Merger constitutes a “Business Combination” as such term is defined in the Current Charter and (iv) resolved to recommend that the dMY Stockholders approve the Merger and the other proposals set forth in this proxy statement/prospectus. The Board also concluded that the fair market value of IonQ was equal to at least 80% of the funds held in the trust account. In making this determination, the Board considered, among other things, the factors set forth below under “— Recommendation of dMY’s Board of Directors and Reasons for the Business Combination.

Later in the evening of March 7, 2021, the parties executed the Merger Agreement and other documentation related thereto and the subscription agreements related to the PIPE Investment. See the section titled “The Merger Agreement and Related Agreements” beginning on page 121 of this proxy statement/prospectus for a

 

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discussion of the terms of the Merger Agreement. On the morning of March 8, 2021, before the U.S. stock markets opened, dMY and IonQ announced the execution of the Merger Agreement and the proposed Business Combination. The parties have continued and expect to continue regular discussions regarding the timing to consummate the Merger.

Recommendation of dMY’s Board of Directors and Reasons for the Business Combination

In reaching its unanimous resolutions (i) that the Merger Agreement and the Merger are fair to and in the best interests of dMY and its stockholders, (ii) to approve and adopt the Merger Agreement and the merger, the PIPE Investment, and the other transactions contemplated by the Merger Agreement and related documents and to declare their advisability, (iii) to approve the transactions, recommend the approval and adoption of the Merger Agreement and the merger by dMY’s stockholders, and (iv) direct that the Merger Agreement and the transactions contemplated thereby (including the merger) be submitted for consideration by dMY’s stockholders, the Board considered and evaluated a range of factors, including, but not limited to, the factors discussed below. Prior to reaching the decision to approve the Merger and the Merger Agreement, the Board consulted with our management, as well as with our legal and financial advisors.

In addition, before determining that the Merger was in the best interests of dMY and its stockholders, the Board reviewed various industry and financial data, including, but not limited to, IonQ’s existing business model, IonQ’s historical and projected financials, and reviewed the results of management’s due diligence review of IonQ which took place over a sixteen week period beginning on November 16, 2020 and continuing through the signing of the Merger Agreement on March 7, 2021, including extensive meetings and calls with IonQ’s management team regarding operations and projections, review of IonQ’s material contracts, intellectual property matters, labor matters, financing and accounting due diligence, tax due diligence, engaging and consulting third-party experts and financial advisors as described above, and other legal due diligence with assistance from our legal counsel.

In approving the Business Combination, the Board determined obtaining a fairness opinion was not necessary. The officers and directors of dMY have substantial experience in evaluating the operating and financial merits of companies from a wide range of industries, including the technology sector, and concluded that their experience and background enabled them to make the necessary analyses and determinations regarding the Business Combination. The equity valuation of IonQ was determined by dMY based on several qualitative factors (including the reasons for entering into the Merger Agreement discussed below) and quantitative factors (including dMY’s review of IonQ’s financial forecasts). dMY applied multiples ranging from 10.0x to 15.0x to IonQ’s projected revenues for 2026 (as set forth in “Certain Projected Financial Information”) to determine an implied range of indicative future enterprise values, which dMY then discounted back to December 2020 at a discount rate of 20% to obtain a range of indicative present valuations for IonQ. dMY determined its range of multiples in its reasonable judgment based on its experience and background, and selected a 20% discount rate based on, among other things, dMY’s familiarity with the expected weighted average cost of capital for a growth-stage company like IonQ. See the section titled “Management of dMY” for additional information regarding the experience of the board of directors and dMY management team.

The Board is comprised of a majority of independent directors who are not affiliated with the Sponsor and its affiliates. In connection with the Business Combination, dMY’s independent directors, Ms. Anderson, Ms. Luthi and Mr. Wert, took an active role in evaluating the proposed terms of the Business Combination, including the Merger Agreement and all related agreements and the amendments to the Current Charter to take effect upon the completion of the Business Combination. dMY’s independent directors evaluated and unanimously approved, as members of the Board, the Merger Agreement and the transactions contemplated therein, including the Business Combination.

The Board considered a number of reasons pertaining to the Business Combination as generally supporting its decision to enter into the Merger Agreement and the transactions contemplated thereby, including the following positive factors, although not weighted or in any order of significance:

 

   

Industry Leadership of IonQ’s Technology. The Board noted that IonQ is poised to become an industry leader in quantum computing, which has the potential to be revolutionary in a variety of fields,

 

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including machine learning, solar energy production, finance, electric vehicles, material science, aerospace, logistics and drug discovery. The Board also noted that IonQ’s technology has significant advantages over existing competitors and that these advantages are expected to allow IonQ’s technology to outperform the competition in the quantum computing sector in the future. The Board noted IonQ’s market position and its technology solutions, which the Board believes position IonQ for future growth and profitability.

 

   

IonQ’s Intellectual Property Portfolio and Barriers to Entry. IonQ’s complex technology is protected by an extensive portfolio of owned and exclusively licensed patents, which, together with the IonQ team’s track record, technical acumen, and existing efforts to commercialize quantum computing presents significant barriers to entry by potential competitors seeking to utilize IonQ’s ion trap technology in quantum computation applications.

 

   

IonQ’s Cloud Computing Advantage. The Board considered IonQ’s advantages in the field of quantum computation as a service, including its partnerships with Amazon Web Services and Microsoft Azure, as well as its development of the IonQ Quantum Cloud platform.

 

   

Demand from PIPE Participants. Significant demand from both strategic and financial PIPE Investors supported dMY’s investment thesis.

 

   

Business and Financial Condition and Prospects. The Board and our management had knowledge of, and were familiar with, IonQ’s business, financial condition, results of operations and future growth prospects. The Board considered IonQ’s modest cloud revenue stream, large and rapidly growing total addressable market, capital expenditures and strong leadership position with its track record of innovation. The Board also discussed IonQ’s current prospects for growth in executing upon and achieving IonQ’s business plan, and noted its innovative technology, its unique market position, opportunities for sustained growth and commercialization of its technology.

 

   

Visionary and Pioneering Management Team. The Board considered the fact that the Combined Company will be led by Peter Chapman, Jungsang Kim and Chris Monroe, who have displayed pioneering and visionary leadership, a strong track record of innovation and who have deep experience in the technology industry. Dr. Kim and Dr. Monroe are each individually among the most cited physicists in the quantum computing space over the past two decades.

 

   

Significant potential benefits to transition to a public company. Transitioning to a public company provides significant benefits for IonQ, including additional access to capital as IonQ continues to scale its business and provides brand awareness associated with being a public company.