Pear Therapeutics, Inc.: going-concern / distress — Pear Therapeutics files Chapter 11, terminates 92% of staff, CEO steps down

For purposes of the Settlement Agreement, the Company and Pear US acknowledged and agreed that outstanding defaults occurred and were continuing under the Credit Agreement and the Administrative Agent exercised certain rights and remedies pursuant to the Credit Agreement and Loan Documents as set forth in the Settlement Agreement.

On April 7, 2023 (the " Petition Date "), the Company and its wholly-owned direct subsidiary, Pear US (together with the Company, the “ Debtors ”), each commenced a voluntary case under chapter 11 of the United States Bankruptcy Code in the United States Bankruptcy Court for the District of Delaware (the “ Bankruptcy Court ”).

Christopher D.T. Guiffre, J.D., M.B.A., the Company’s Chief Operating Officer, and Chief Financial Officer will serve as the Company’s principal executive officer following the departure of Dr. McCann.

Effective April 6, 2023, in anticipation of the filing of the Chapter 11 Cases discussed in Item 1.03 above, Corey McCann, M.D., Ph.D. stepped down as the Company’s Chief Executive Officer and President.

On April 6, 2023, Pear Therapeutics, Inc. (“ Pear ” or the “ Company ”) entered into a Settlement Agreement (the “ Settlement Agreement ”) by and among Perceptive Credit Holdings III, LP, as Administrative Agent (the “ Administrative Agent ”), Perceptive Credit Holdings III, LP, as sole Lender (the “ Lender ”), the Company, Pear Therapeutics (US), Inc. (“ Pear US ”, together with the Company, the “ Obligors ”), and Pear Therapeutics Securities Corporation (“ Pear MSC ”) in connection with that certain Amended and Restated Credit Agreement and Guaranty dated as of March 25, 2022 (as amended, modified, restated or supplemented to from time to time, the “ Credit Agreement ”) and the Loan Documents (as defined in the Credit Agreement) in connection therewith. Pursuant to the Settlement Agreement and in full, complete and final satisfaction of all obligations under the Credit Agreement and the Loan Documents (inclusive of the early prepayment fee of $3.6 million) (i) $18.66 million in cash

On April 5, 2023, the Company's board of directions (the " Board ") authorized the termination of approximately 170 employees, or 92% of full-time employees effective April 7, 2023 and restructured the Company's operations to maintain a transition team of approximately 15 employees to continue operations in connection with the Chapter 11 Cases. All terminated employees were paid through April 7, 2023, received two weeks’ salary as severance and were asked to sign a separation agreement, which includes a general release of claims against the Company. The reduction in force was completed on April 6, 2022 and the Company recorded a one-time charge of approximately $1.2 million in the second quarter of 2023 related to the reduction in workforce, consisting primarily of one-time severance payments upon termination of the employees.