Item 8.01. Other Events.
As previously disclosed, on August 5, 2020, Livongo Health, Inc. ("Livongo")
entered into an Agreement and Plan of Merger (the "Merger Agreement") with
Teladoc Health, Inc. ("Teladoc") and Tempranillo Merger Sub, Inc., a wholly
owned subsidiary of Teladoc ("Merger Subsidiary"). Upon the terms and subject to
the conditions of the Merger Agreement, Merger Subsidiary will merge with and
into Livongo (the "Merger"), with Livongo surviving as a wholly owned subsidiary
of Teladoc. Pursuant to the Merger Agreement, at the effective time of the
Merger (the "Effective Time"), each share of common stock, par value $0.001 per
share, of Livongo ("Livongo Common Stock") issued and outstanding immediately
prior to the Effective Time (other than shares held by any shareholder who
properly demands and perfects his, her or its appraisal rights with respect to
such shares and treasury shares held by Livongo), will be converted into the
right to (i) receive 0.5920 of a share of common stock, par value $0.001 per
share, of Teladoc and (ii) $4.24 in cash, without any interest thereon. In
addition, prior to the Effective Time, Livongo will declare a special cash
dividend (the "Special Dividend") equal to $7.09 per share of Livongo Common
Stock to shareholders of Livongo as of a record date immediately prior to the
Effective Time.
For U.S. federal income tax purposes, the Special Dividend is intended to be
treated, and will be reported by Livongo, as a distribution by Livongo within
the meaning of Section 301 of the Internal Revenue Code of 1986, as amended, and
not as consideration paid for Livongo Common Stock in the Merger. Assuming this
intended treatment is respected, the Special Dividend will be treated as a
dividend for U.S. federal income tax purposes to the extent paid out of current
or accumulated earnings and profits of Livongo. To the extent the amount of the
Special Dividend exceeds Livongo's current and accumulated earnings and profits,
the excess will first be treated as a tax-free return of capital, causing a
reduction in the holder's adjusted basis in its Livongo Common Stock. If such
basis is reduced to zero, any remaining portion of the Special Dividend will be
taxed as capital gain, which would be long-term capital gain if the holder has
held the Livongo Common Stock for more than one year at the time the Special
Dividend is received.
The process of determining current and accumulated earnings and profits requires
a final determination of Livongo's financial results for the year and a review
of certain other factors. Based on Livongo's current estimate of its current and
accumulated earnings and profits, it expects that none of the Special Dividend
will be paid out of its current or accumulated earnings and profits, and thus
Livongo expects that the Special Dividend will be treated as a tax-free return
of capital (to the extent of a holder's adjusted basis) and that none of the
Special Dividend will be treated as a dividend for U.S. federal income tax
purposes. In connection with the Merger, Teladoc filed a registration statement
on Form S-4 (File No. 333-248568) with the U.S. Securities and Exchange
Commission (the "SEC") containing a prospectus of Teladoc that also constitutes
a definitive joint proxy statement of each of Teladoc and Livongo. The
registration statement, as amended, was declared effective by the SEC on
September 15, 2020. Holders of Livongo Common Stock should review the definitive
joint proxy statement, which provides additional details regarding U.S. federal
income tax considerations related to the Special Dividend, and consult their tax
advisors regarding any alternative characterization of the Special Dividend,
including as consideration received in the Merger in exchange for their shares
of Livongo Common Stock, and as to the tax consequences of the Special Dividend
in their particular circumstances.
Cautionary Note Regarding Forward-Looking Statements
This communication contains forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995, Section 27A of the Securities
Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934,
as amended. These forward-looking statements generally include statements
regarding the potential transaction between Teladoc and Livongo, including any
statements regarding the expected timetable for completing the potential
transaction, the ability to complete the potential transaction, the expected
benefits of the potential transaction (including anticipated synergies,
projected financial information and future opportunities) and any other
statements regarding Teladoc's and Livongo's future expectations, beliefs,
plans, objectives, results of operations, financial condition and cash flows, or
future events or performance. These statements are often, but not always, made
through the use of words or phrases such as "anticipate," "intend," "plan,"
"believe," "project," "estimate," "expect," "may," "should," "will" and similar
expressions. All such forward-looking statements are based on current
expectations of Teladoc's and Livongo's management and therefore involve
estimates and assumptions that are subject to risks, uncertainties and other
factors that could cause actual results to differ materially from the results
expressed in the statements. Key factors that could cause actual results to
differ materially from those projected in the forward-looking statements include
the ability to obtain the requisite Teladoc and Livongo stockholder approvals;
uncertainties as to the timing to consummate the potential transaction; the risk
that a condition to closing the potential transaction may not be satisfied; the
risk that the anticipated U.S. federal income tax treatment of the transaction
is not obtained; litigation relating to the potential transaction that have been
or could be instituted against Teladoc, Livongo or their respective directors;
the effects of disruption to Teladoc's or Livongo's respective businesses;
restrictions during the pendency of the potential transaction that may impact
Teladoc's or Livongo's ability to pursue certain business opportunities or
strategic

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transactions; the effect of this communication on Teladoc's or Livongo's stock
prices; transaction costs; Teladoc's ability to achieve the benefits from the
proposed transaction; Teladoc's ability to effectively integrate acquired
operations into its own operations; the ability of Teladoc or Livongo to retain
and hire key personnel; unknown liabilities; and the diversion of management
time on transaction-related issues. Other important factors that could cause
actual results to differ materially from those in the forward-looking statements
include the effects of industry, market, economic, political or regulatory
conditions outside of Teladoc's or Livongo's control (including public health
crises, such as pandemics and epidemics); changes in laws and regulations
applicable to Teladoc's business model; changes in market conditions and
receptivity to Teladoc's services and offerings; results of litigation; the loss
of one or more key clients of Teladoc (including potential adverse reactions or
changes to business relationships resulting from the announcement or completion
of the potential transaction); changes to Teladoc's abilities to recruit and
retain qualified providers into its network; the impact of the COVID-19 pandemic
on the parties' business and general economic conditions; risks regarding
Livongo's ability to retain clients and sell additional solutions to new and
existing clients; Livongo's ability to attract and enroll new members; the
growth and success of Livongo's partners and reseller relationships; Livongo's
ability to estimate the size of its target market; uncertainty in the healthcare
regulatory environment; and the factors set forth under the heading "Risk
Factors" of Teladoc's Annual Report and Livongo's Annual Report, in each case on
Form 10-K, and in subsequent filings with the U.S. Securities and Exchange
Commission (the "SEC"). These risks, as well as other risks associated with the
potential transaction, are more fully discussed in the joint proxy
statement/prospectus filed with the SEC in connection with the proposed
transaction. Other unpredictable or unknown factors not discussed in this
communication could also have material adverse effects on forward-looking
statements. Neither Teladoc nor Livongo assumes any obligation to update any
forward-looking statements, except as required by law. Readers are cautioned not
to place undue reliance on these forward-looking statements that speak only as
of the date hereof.
No Offer or Solicitation
This communication does not constitute an offer to sell or the solicitation of
an offer to buy any securities or a solicitation of any vote or approval, nor
shall there be any sale of securities in any jurisdiction in which such offer,
solicitation or sale would be unlawful prior to registration or qualification
under the securities laws of any such jurisdiction. No offer of securities shall
be made except by means of a prospectus meeting the requirements of Section 10
of the Securities Act of 1933, as amended.
Important Information for Investors and Stockholders
In connection with the potential transaction, Teladoc has filed a registration
statement on Form S-4 (File No. 333-248568) with the SEC containing a prospectus
of Teladoc that also constitutes a definitive joint proxy statement of each of
Teladoc and Livongo. The registration statement, as amended, was declared
effective by the SEC on September 15, 2020. Each of Teladoc and Livongo
commenced mailing copies of the definitive joint proxy statement/prospectus to
stockholders of Teladoc and Livongo, respectively, on or about September 15,
2020. Teladoc and Livongo may also file other documents with the SEC regarding
the potential transaction. This communication is not a substitute for the joint
proxy statement/prospectus or registration statement or for any other document
that Teladoc or Livongo have filed or may file with the SEC in connection with
the potential transaction. INVESTORS AND SECURITY HOLDERS OF TELADOC AND LIVONGO
ARE URGED TO READ THE JOINT PROXY STATEMENT/PROSPECTUS AND OTHER DOCUMENTS THAT
ARE FILED OR WILL BE FILED WITH THE SEC, AS WELL AS ANY AMENDMENTS OR
SUPPLEMENTS TO THESE DOCUMENTS, CAREFULLY AND IN THEIR ENTIRETY BECAUSE THEY
CONTAIN IMPORTANT INFORMATION. Investors and security holders will be able to
obtain free copies of the joint proxy statement/prospectus and other documents
filed with the SEC by Teladoc or Livongo through the website maintained by the
SEC at http://www.sec.gov. Copies of the documents filed with the SEC by Teladoc
will be available free of charge on Teladoc's website at
https://ir.teladochealth.com and copies of the documents filed with the SEC by
Livongo will be available free of charge on Livongo's website at
https://ir.livongo.com/. Additionally, copies may be obtained by contacting the
investor relations departments of Teladoc or Livongo.
Teladoc and Livongo and certain of their respective directors, certain of their
respective executive officers and other members of management and employees may
be considered participants in the solicitation of proxies with respect to the
potential transaction under the rules of the SEC. Information about the
directors and executive officers of Teladoc is set forth in its proxy statement
for its 2020 annual meeting of stockholders, which was filed with the SEC on
April 14, 2020. Information about the directors and executive officers of
Livongo is set forth in its Annual Report on Form 10-K for the year ended
December 31, 2019, which was filed with the SEC on March 24, 2020, and its proxy
statement for its 2020 annual meeting of stockholders, which was filed with the
SEC on April 6, 2020. These documents can be obtained free of charge from the
sources indicated above. Additional information regarding the interests of such
participants in the solicitation of proxies in respect of the potential
transaction are included in the registration statement and joint proxy
statement/prospectus and other relevant materials filed with the SEC.

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The term "Livongo" and such terms as "the company," "the corporation," "our," "we," "us" and "its" may refer to Livongo Health, Inc., one or more of its consolidated subsidiaries, or to all of them taken as a whole. All of these terms are used for convenience only and are not intended as a precise description of any of the separate companies, each of which manages its own affairs.

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