Company: AMWL
Filing Date: 2025-01-10
Form Type: 8-K
Source: 0000950170-25-004254
Chunk: 0

Company: American Well Corp
Filing Date: 2025-01-10
Form: 8-K
Item: Item 1.01
Chunk 0
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Item 1.01 Entry into a Material Definitive Agreement.

On January 8, 2025, American Well Corporation (the “ Company”), Aligned Telehealth, LLC, a wholly owned subsidiary of the Company (the “ Seller”), and Avel eCare, LLC (the “ Buyer”) entered into an asset purchase agreement (the “ Agreement”) relating to the sale by the Seller, and the purchase by the Buyer, of all property and assets owned, leased or licensed by the Seller that are primarily used or held for use in connection with the Company’s business of providing telepsychiatry services to hospitals and correctional programs (the “ Business”), subject to certain specified exclusions such as cash. In connection with such purchase and sale, the Buyer assumed specified contracts and the related accounts receivable and all accounts payable and accrued expenses of the Business. The purchase price is comprised of (i) an upfront cash payment of $20,714,459, which is equal to 1.1x the Business’ trailing twelve-month revenue, excluding on-site revenue attributable to certain of the Business’ contracts, subject to customary adjustments and (ii) an additional cash payment (the “ Additional Payment”) equal to 0.4x the Buyer and its affiliates’ aggregate revenues arising from the provision of the Business to current customers and potential customers in the sales pipeline of the Company Group (as defined below) during the twelve-month period immediately following the closing, excluding revenues arising from the provision of on-site psychiatric services to certain of the Business’ contracts and other specified revenues, which Additional Payment is payable within ten days following the final determination of the Additional Payment amount. If the Buyer experiences certain change-of-control events during the twelve-month period immediately following the closing or if the Buyer fails to pay the Additional Payment (“ Acceleration Event”), the Seller may elect to receive an amount equal to 0.4x the Buyer and its affiliates’ aggregate revenues arising from the provision of the Business to current customers and potential customers in the sales pipeline of the Company Group during the twelve-month period ending on the last day of the month immediately preceding the month in which the applicable Acceleration Event occurs. The Agreement includes a four-year non-competition covenant and a one-year non-solicitation covenant of the Company and the Seller, customary representations and warranties of the parties and customary indemnification provisions. The foregoing summary is qualified in its entirety by the Agreement, which is attached as Exhibit 10.1 hereto and incorporated by reference herein.

The closing of the purchase and