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Check the box if the filing relates solely to preliminary communications made before the commencement of a tender offer.
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Akili announced a strategic combination with Virtual Therapeutics aimed at creating a more diversified leading digital health company.
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The combination will bring together two highly complementary and user-centric businesses to create new opportunities for the combined company.
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Combining Akili with Virtual Therapeutics will create an integrated company that offers a broader suite of digital therapeutics and achieves our
longstanding goal of bringing innovative solutions to more users.
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The transaction is currently expected to close in the third quarter of 2024.
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Virtual Therapeutics is a leading digital health company developing VR-based applications to improve mental health for employees and patients using
immersive technology, evidence-based techniques, and engaging content.
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Virtual Therapeutics’ programs typically include a suite of applications using virtual reality technology to relieve chronic stress, anxiety, and
depression to improve productivity and job satisfaction.
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Each application is based on rigorous scientific research and is targeted towards specific mental attributes such as mindfulness and cognitive
flexibility to help ensure a broad array of mental health needs are addressed.
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For more information, please visit https://www.vthera.com/.
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We participate in a complex, competitive, capital intensive space - we believe that combining our assets and proven ability to develop and obtain
regulatory approval for mobile digital therapeutic solutions with Virtual Therapeutics’ expertise in creating engaging, VR-based solutions and partnerships with leading health care organizations creates a combined company that will have the
technologies and financial basis necessary to achieve our goal of becoming profitable and impacting lives around the world.
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Overall, with impressive capabilities from both organizations, we can reach even greater heights than we could have achieved on our own.
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We are confident that Akili and Virtual Therapeutics will be terrific partners.
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From our many interactions with Virtual Therapeutics, we believe that Virtual Therapeutics has a culture very similar to our own. We can see that
they share our commitment to thinking like owners while maintaining a healthy, vibrant and collaborative culture.
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Until the transaction closes, which we currently expect to occur in the third quarter of 2024, Akili and Virtual Therapeutics remain separate
companies operating independently as we have done before.
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It is important to stay focused on our day-to-day roles and responsibilities so that we can continue to support Shionogi and to support and deliver
our digital therapeutics products to users. They depend on us.
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Virtual Therapeutics will compensate Akili employees at their current salary levels.
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The VT Leadership Team will perform a thorough review of benefits in the upcoming period and work to move all combined employees to the same plans.
This will likely mean that some of the benefits Akili employees have been accustomed to will be reduced or eliminated in order to control costs as we transition together to more of a pre-profitability startup mindset. VT currently has
plans in place that are market-competitive with other similar stage companies: VT offers Premera Blue Cross Blue Shield health insurance, a matching 401(k) plan, modest HSA contributions, and other vision, dental, disability, and life
insurance benefits.
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VT also has a Stock Option Incentive Plan designed to align employee and company objectives.
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With respect to severance, Virtual Therapeutics has agreed that any Akili team members impacted in connection with any potential post-closing
workforce reduction as part of a reorganization of the combined business would be entitled to transition packages that are similar to those offered to those impacted in Akili’s restructuring announced in April 2024.
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If you continue to work for Virtual Therapeutics or its affiliates after the closing of the transaction, then pursuant to the terms and conditions
of the Merger Agreement, it is expected that:
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The pre-existing conditions, limitations, exclusions, actively-at-work requirements, and eligibility waiting periods under Virtual Therapeutics’
health plans would be waived with respect to continuing employees to the extent not imposed under Akili’s group health plans prior to closing.
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Dollar amounts that continuing employees incurred under Akili’s health plans during the plan year of the closing would be recognized under Virtual
Therapeutics’ group health plans for purposes of meeting deductible, co-payment limitations, and out-of-pocket maximums for its plan year.
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Your prior service with Akili and its subsidiaries would be credited under Virtual Therapeutics’ benefit plans for purposes of determining your
eligibility to participate, vesting, and future vacation and paid time off accruals, to the extent your service was recognized under Akili’s benefit plans for similar purposes, without any duplication of benefits. Such service credit will
not be provided for purposes of any entitlement to participate in, or benefit accruals with respect to, any equity-based or long-term incentive compensation, retiree medical program, or defined benefit plan maintained by Virtual
Therapeutics.
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It is anticipated that the Akili 401(k) plan and health plans will be terminated as of the closing of the transaction and we will work closely with
the Virtual Therapeutics team to ensure a smooth transition for Akili employees who will become eligible to participate in the 401(k) plan and health plans of Virtual Therapeutics, subject to their terms and conditions.
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If you hold outstanding stock
options:
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As of immediately prior to the Effective Time (as defined in the Merger Agreement), each unvested outstanding stock option will become immediately
vested and exercisable in full.
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After giving effect to the vesting acceleration, if your outstanding stock option has a per share exercise price that is less than $0.4340 (the “Offer Price”), at the Effective
Time, it will be canceled in exchange for payment of an amount in cash without interest, less any applicable tax withholding, equal to the
product obtained by multiplying (i) the excess of the Offer Price over the exercise price per share of the Company common stock underlying such stock option by (ii) the number of shares of Company common stock underlying such stock option.
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If your outstanding stock option has a per share exercise price that is equal to or greater than the Offer Price, it will be canceled at the Effective Time for no consideration.
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If you hold outstanding time-based restricted stock units (“RSUs”):
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As of immediately prior to the Effective Time, each unvested outstanding RSU will become immediately vested in full.
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After giving effect to the vesting acceleration, at the Effective Time, each RSU that is then outstanding shall be canceled in exchange for payment
of an amount in cash without interest, less any applicable tax withholding, equal to the Offer Price.
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If you hold outstanding performance-based restricted
stock units (“PSUs”), each PSU will be canceled at the Effective Time for no consideration.
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All Earn-out Shares and Earn-out
RSUs will be cancelled. The Earn out Shares and Earn out RSUs would have only vested if the Company’s trading price hit at least $15.00 per share. Based on the Offer Price and the fact that the Company’s common stock will no
longer be traded, it will be impossible for such Earn out Shares and Earn-out RSUs to vest, and thus they are being cancelled in the transaction.
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Those types of decisions will be made by the combined leadership team after the transaction closes. Meanwhile, we have an opportunity in the coming weeks to work collaboratively to define goals
and influence the outcome to ensure we position the combined business with the greatest chance of success in the future. As part
of this, we will be doing planning to determine the optimal organization going forward. We are committed to being as transparent as possible during
this process, and treating all employees with due respect.
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Virtual Therapeutics has agreed that any Akili team members impacted in connection with any potential post-closing workforce reduction as part of a
reorganization of the combined business would be entitled to transition packages that are similar to those offered to those impacted in Akili’s restructuring announced in April 2024.
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Until the transaction closes, which we currently expect to occur in third quarter of 2024,
Akili and Virtual Therapeutics will
remain separate companies operating independently and as we have done before.
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Remaining focused on your day-to-day responsibilities and remembering that we have many product users, as well as Shionogi, depending on us is the best thing we can do.
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The current VT management team, led by Dan Elenbaas as President & CEO, will continue in their current roles and lead the combined company.
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Until the transaction closes, both Akili and Virtual Therapeutics expect to remain in their
current locations.
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We will review our ongoing facility requirements after closing and make changes if appropriate. To be clear, even if we opt to make facility
adjustments, there is no plan to move the Larkspur team itself.
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Any such changes would occur following the closing of the transaction, which is currently
expected to occur in the third quarter of 2024.
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Upon completion of the transaction, the parent company of the combined business will be called Virtual Therapeutics.
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The transaction is currently expected to close in the third quarter of 2024, subject to the
necessary approvals and satisfaction of the closing conditions in the Merger Agreement.
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It is important to remember that until closing, Akili and Virtual Therapeutics remain separate organizations, and we will operate as we have before.
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If you are approached by a Virtual Therapeutics team member for any information
about the integration, please refer them to Grace Kim at gkim@akiliinteractive.com.
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The proposed combination does not impact our
relationships with our partners, and we are operating as we have before.
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We remain dedicated to working with our partners to support their needs and the needs of the users we serve.
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It is important that you DO NOT post on social media about this announcement. Only authorized leaders at Akili are permitted to discuss the transaction publicly, including on social media.
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You can share Akili social posts (if any) from our official channels (those owned
by Akili and operated by the Akili team),
but please do not add any commentary to official posts that you choose to share.
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We ask that you do not engage beyond that, especially with third parties. This includes but is not limited to liking messages,
responding to other users, or reposting content.
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It is important that we speak with one voice and that you do not make any comments, including in response to media or investor inquiries.
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Please note that Akili’s Social Media Policy still applies and Akili does not intend to restrict communications or actions by
employees that are protected or required by state or federal law.
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If you have questions or concerns beyond what is provided in this Employee FAQ, please
contact a member of the Akili Leadership Team.
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We will continue to keep you updated on important developments as we move through the transaction process.
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