Sponsor Support Agreement
On January 26, 2022, SCS also entered into a Sponsor Support Agreement (the “Sponsor Support Agreement”), by and among SCS, the Sponsor, certain directors and officers of SCS and Akili, pursuant to which the Sponsor and each such director and officer of SCS agreed to, among other things, vote in favor of the Merger Agreement and the transactions contemplated thereby and not redeem their SCS ordinary shares in connection therewith, in each case, subject to the terms and conditions contemplated by the Sponsor Support Agreement.
Akili Holders Support Agreement
On January 26, 2022, SCS also entered into a Stockholders Support Agreement (the “Akili Holders Support Agreement”), by and among SCS, Akili and certain stockholders of Akili (the “Key Stockholders”). Under the Akili Holders Support Agreement, the Key Stockholders agreed, within two business days after the registration statement on S-4 relating to the approval by SCS stockholders of the Business Combination is declared effective by the SEC and delivered or otherwise made available to stockholders, with respect to the outstanding shares of Akili common stock and preferred stock held by such Key Stockholders, to (i) vote its shares or (ii) execute and deliver a written consent adopting the Merger Agreement and related transactions and approving the Business Combination. The shares of Akili common stock and preferred stock that are owned by the Key Stockholders and subject to the Akili Holders Support Agreement represent a majority of the outstanding voting power of Akili common stock and preferred stock (on an as converted basis).
Registration Rights Agreement
The Merger Agreement contemplates that, at the Closing, SCS, the Sponsor, certain equityholders of Akili and certain of their respective affiliates, as applicable, and the other parties thereto, will enter into an Amended and Restated Registration Rights Agreement (the “A&R Registration Rights Agreement”), pursuant to which SCS will grant customary registration rights to the other parties thereto, including to register for resale, pursuant to Rule 415 under the Securities Act of 1933, as amended (the “Securities Act”), certain shares of SCS Common Stock that are held by the other parties thereto.
Lock-Up Agreement
The Merger Agreement contemplates that, at the Closing, SCS and the Key Holders (as defined in the Merger Agreement), will enter into a Lock-Up Agreement (the “Lock-Up Agreement”).
The Lock-Up Agreement contains certain restrictions on transfer with respect to shares of SCS Common Stock held by the Key Holders immediately following the Closing (other than shares purchased in the public market, or in the PIPE Investment or, solely in the case of Key Holders who are former Akili stockholders, shares acquired prior to the Closing) and the shares of SCS Common Stock issued to directors and executive officers of the combined company upon settlement or exercise of stock options or other equity awards outstanding as of immediately following the Closing in respect of awards of Akili outstanding immediately prior to the Closing (the “Lock-up Shares”). Such restrictions begin at the Closing and end on the earlier of (i) the date on which the SEC declares effective the first registration statement on Form S-1 filed by the combined company to register the resale of the PIPE Shares (as defined in the Lock-Up Agreement); (ii) (a) for 33% of the Lock-up Shares, the date on which the last reported sale price of SCS Common Stock equals or exceeds $12.50 per share for any 20 trading days within any 30-trading day period commencing at least 30 days after the Closing and (b) for an additional 50% of the Lock-up Shares, the date on which the last reported sale price of SCS Common Stock equals or exceeds $15.00 per share for any 20 trading days within any 30-trading day period commencing at least 30 days after the Closing; and (iii) 180 days following the Closing.
The foregoing description of the Merger Agreement, the Subscription Agreements, the Sponsor Support Agreement and the Akili Holders Support Agreement, and the transactions and documents contemplated thereby (including, without limitation, the A&R Registration Rights Agreement and the Lock-Up Agreement), is not complete and is subject to and qualified in its entirety by reference to the Merger Agreement, the form of Subscription Agreement, the Sponsor Support Agreement and the Akili Holders Support Agreement, copies of which are filed with this Current Report on Form 8-K as Exhibit 2.1, Exhibit 10.1, Exhibit 10.2 and Exhibit 10.3, respectively, and the terms of which are incorporated by reference herein.
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