UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 15(d)

of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): November 1, 2021

23andMe Holding Co.

(Exact name of registrant as specified in its charter)

223 N. Mathilda Avenue

Sunnyvale, California 94086

(Address of principal executive offices, including zip code)

Registrant’s telephone number, including area code: (650) 938-6300

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

Securities registered pursuant to Section 12(b) of the Act:

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

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 13(a) of the Exchange Act.  ☐

On November 1, 2021, 23andMe Holding Co. (“23andMe,” “we,” “us,” or “our”) completed the previously-announced acquisition of Lemonaid Health, Inc. (the “Company”) (the “Acquisition”), pursuant to that certain Agreement and Plan of Merger and Reorganization (the “Merger Agreement”), dated as of October 21, 2021, by and among 23andMe, Life Merger Sub One, Inc., Life Merger Sub Two, Inc., the Company, and Fortis Advisors LLC, in its capacity as representative of the Indemnifying Parties (the “Securityholder Representative”). Capitalized terms used herein but not otherwise defined have the meaning set forth in the Merger Agreement.

At the Closing, pursuant to the terms of the Merger Agreement, as consideration for the transactions contemplated thereby and subject to certain adjustments as set forth in the Merger Agreement, 23andMe (i) paid aggregate cash consideration of approximately $88.63 million and (ii) issued 30,027,958 shares (the “Stock Consideration”) of Class A common stock of 23andMe, par value $0.0001 per share (the “Class A Common Stock”). The Stock Consideration excludes shares issuable upon exercise of outstanding unvested stock option awards previously issued by the Company that, pursuant to the terms of the Merger Agreement, were converted into unvested options of equivalent value, pursuant to the conversion ratio set forth in the Merger Agreement, to acquire shares of Class A Common Stock under the 23andMe Holding Co. 2021 Incentive Equity Plan. A portion of the cash consideration is being held in escrow to (i) provide 23andMe recourse for any purchase price adjustment and (ii) secure the indemnification obligations of the Indemnifying Parties.

The description of the Merger Agreement contained in Item 1.01 of the Current Report on Form 8-K filed with the Securities and Exchange Commission (the “SEC”) by 23andMe on October 22, 2021 (the “Signing 8-K”) is incorporated herein by reference. The foregoing description and the summary description contained in Item 1.01 of the Signing 8-K do not purport to be complete and are qualified in their entireties by reference to the full text of the Merger Agreement, which was filed as Exhibit 2.1 to the Signing 8-K and is incorporated herein by reference.

The disclosures set forth in Item 2.01 with respect to the issuance of the Stock Consideration above are incorporated by reference into this Item 3.02.

Pursuant to the Merger Agreement, 23andMe issued the Stock Consideration solely to those individuals who are “accredited investors” as defined in Rule 501 of Regulation D promulgated under the Securities Act of 1933, as amended (the “Securities Act”), in a private placement exempt from registration pursuant to Section 4(a)(2) of the Securities Act. The shares of Class A Common Stock issued as Stock Consideration are restricted securities for purposes of Rule 144 under the Securities Act and subject to certain requirements restricting the resale of such shares, including certain holding period requirements. 23andMe did not engage in general solicitation or advertising with regard to the issuance and sale of the Class A Common Stock issued as Stock Consideration.

On November 1, 2021, 23andMe issued a press release announcing the closing of the Acquisition. A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated by reference herein.

The information furnished pursuant to this Item 7.01 and the accompanying Exhibit 99.1 shall not be deemed to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that section, and is not to be incorporated by reference into any filing of 23andMe.

The following risk factors are provided to update the risk factors of 23andMe previously disclosed in 23andMe’s periodic reports filed with the SEC, including its Quarterly Report on Form 10-Q for the quarter ended June 30, 2021:

We face additional risks as a result of the Acquisition and may be unable to integrate our businesses successfully and realize the anticipated synergies and related benefits of the Acquisition or do so within the anticipated timeframe.

On November 1, 2021, we completed our acquisition of the Company. As a result of the Acquisition, 23andMe faces various additional risks, including, among others, the following:

Our ability to execute all such plans will depend on various factors, many of which remain outside our control. Any of these risks could adversely affect our business and financial results.

The process of integrating the Company’s operations into our operations could result in unforeseen operating difficulties and require significant resources.

The following factors, among others, could reduce our revenues and earnings, increase our operating costs, and result in a loss of projected synergies:

The process of integrating the Company and its associated services and technologies involves numerous risks that could materially and adversely affect our results of operations or stock price.

The following factors, among others, could materially and adversely affect our results of operations or stock price:

Notwithstanding the due diligence investigation we performed in connection with the Acquisition, the Company may have liabilities, losses, or other exposures for which we do not have adequate insurance coverage, indemnification, or other protection.

While we performed significant due diligence on the Company prior to signing the Merger Agreement, we are dependent on the accuracy and completeness of statements and disclosures made or actions taken by the Company and its representatives when conducting due diligence and evaluating the results of such due diligence. We did not control and may be unaware of activities of the Company before the Acquisition, including intellectual property and other litigation or disputes, information security vulnerabilities, violations of laws, policies, rules and regulations, commercial disputes, tax liabilities, and other liabilities.

Our post-closing recourse is limited under the Merger Agreement.

The Indemnifying Parties’ (as defined in the Merger Agreement) obligations to indemnify us are limited to, among others, breaches of specified representations and warranties and covenants included in the Merger Agreement and other specific indemnities as set forth in the Merger Agreement. In the event of a breach of a representation or warranty, we cannot recover in respect of a claim for indemnification pursuant to the Merger Agreement unless and until the indemnifiable losses exceed $2,000,000 (the “Deductible”), in which case we would only be entitled to recover solely such amounts in excess of the Deductible. Additionally, we may not recover losses in excess of $2,000,000 (the “Cap”). Notwithstanding the foregoing, the Deductible and the Cap do not apply to indemnification claims based on breaches of Fundamental Representations or Fraud (each as defined in the Merger Agreement); furthermore, the Cap does not apply to indemnification claims based on breaches of Specified Representations (as defined in the Merger Agreement).

We cannot make an indemnification claim against the Indemnifying Parties for a breach of a representation or warranty after the date that is 18 months after the date of closing of the Acquisition (the “Closing”); provided, however, (1) the Fundamental Representations survive the Closing and continue in full force and effect until 6 years after the Closing, (2) the Specified Representations survive the Closing and continue in full force and effect until 30 months after the Closing, and (3) any claim of Fraud survives the Closing indefinitely.

23andMe obtained a representation and warranty insurance policy to insure against certain losses arising from breaches of, or inaccuracies in, the representations and warranties of the Company. The policy is subject to a retention amount, exclusions, policy limits, and certain other terms and conditions.

If any issues arise post-closing, we may not be entitled to sufficient, or any, indemnification or recourse from the Indemnifying Parties, which could have a material adverse impact on our business and results of operations.

(d) Exhibits.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Dated: November 2, 2021