Management Change/Compensation (Form 8-K)

Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

As previously disclosed, Avidity Biosciences, Inc., (the "Company"), entered into an Agreement and Plan of Merger, dated as of October 25, 2025 (the "Merger Agreement"), with Novartis AG, a company limited by shares (Aktiengesellschaft) incorporated under the laws of Switzerland ("Parent") and Ajax Acquisition Sub, Inc., a Delaware corporation and an indirect wholly owned subsidiary of Parent ("Merger Sub"), pursuant to which, on the terms and subject to the conditions set forth in the Merger Agreement, Merger Sub will merge with and into the Company (the "Merger"), with the Company surviving the Merger as an indirect wholly owned subsidiary of Parent.

In connection with the Merger, certain employees of the Company (including certain of its named executive officers) may become entitled to payments and benefits that may be treated as "excess parachute payments" within the meaning of Section 280G of the Internal Revenue Code of 1986, as amended ("Section 280G" and the "Code," respectively). To mitigate the potential impact of Section 280G and Section 4999 of the Code on the Company and its applicable executive officers, on December 14, 2025, the Company's Board of Directors (the "Board") approved the acceleration into December 2025 of the vesting and payments of certain equity awards and annual cash bonuses, respectively, that otherwise would have been payable to Ms. Boyce, Dr. Flanagan, Ms. McCarthy and Mr. Moriarty and certain other Company executives (collectively, the "Affected Executives") on or prior to the closing of the Merger or otherwise in 2026. These actions are intended to benefit the Company by preserving potential compensation-related corporate income tax deductions for the Company that otherwise might be disallowed through the operation of Section 280G and to mitigate the amount of excise tax that may be payable by the Affected Executives pursuant to Section 4999 of the Code.

The approved accelerated vesting and payments consisted of the following forms, to the extent applicable to each Affected Executive: (a) payment of the Affected Executive's fiscal year 2025 annual bonus that otherwise would be payable in 2026 ("Accelerated Bonus"); (b) vesting and settlement in shares of Company common stock ("shares") of certain Company restricted stock units held by the Affected Executive ("Accelerated RSUs"); and (c) vesting and settlement in shares of certain Company performance-vesting restricted stock units ("Accelerated PSUs") held by the Affected Executives.

The Accelerated Bonus, Accelerated RSUs and Accelerated PSUs (collectively, the "Accelerated Amounts") represent payments or amounts the Affected Executive otherwise would have been entitled to receive upon the consummation of the Merger or otherwise in 2026. Therefore, there will be no duplication of payments. All Accelerated Amounts will be reduced by applicable tax withholdings and are subject to the terms of the Accelerated Payments and Clawback Agreements (described below).

Specifically, the Board approved for each Affected Executive who is a named executive officer the following accelerated vesting and payments:

No named executive officer received Accelerated RSUs.

In connection with the accelerated vesting and payments described above, each Affected Executive has signed an Accelerated Payments and Clawback Agreement providing that the Affected Executive's accelerated payments are subject to certain repayment conditions. Generally, if an Affected Executive's employment with the Company is terminated for "cause" or voluntarily by the Affected Executive other than for "good reason" prior to the date on which the applicable payment would have been made (or, if later, prior to December 31, 2029, in the case of the Accelerated PSUs) but for the payment of the relevant Accelerated Amount, then the Affected Executive would be required to repay to the Company the applicable Accelerated Amount.

The description of the Accelerated Payments and Clawback Agreements does not purport to be complete and is qualified in its entirety by reference to the full text of the Form of Accelerated Payments and Clawback Agreement, a copy of which is filed as Exhibit 10.1 herewith and is incorporated by reference herein.

Item 8.01 Other Events.

As previously disclosed, on November 21, 2025, the Company and Parent filed notification of the transactions contemplated by the Merger Agreement and the Spin-OffAgreements (as defined in the Merger Agreement and such transactions, the "Transactions") with the Federal Trade Commission (the "FTC") and the U.S. Department of Justice under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 (the "HSR Act").

On December 17, 2025, the FTC granted a request for the early termination of the waiting period under the HSR Act. The expiration of the waiting period under the HSR Act satisfies one of the conditions to the consummation of the Transactions. The consummation of the Transactions remains subject to completion of the separation of Atrium Therapeutics, Inc. ("SpinCo") from the Company and the satisfaction or waiver of other customary closing conditions as described in the preliminary proxy statement filed by the Company with the SEC, as amended.