0001496963FALSE00014969632024-05-132024-05-13

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): May 13, 2024
Squarespace, Inc.
(Exact name of Registrant as Specified in Its Charter)
Delaware
(State or Other Jurisdiction
 of Incorporation)
001-40393
(Commission
 File Number)
20-0375811
(IRS Employer
 Identification No.)
225 Varick Street,12th Floor
New York,New York
(Address of Principal Executive Offices)
10014
(Zip Code)
(646) 580-3456
(Registrant's Telephone Number, Including Area Code)
Not Applicable
(Former Name or Former Address, if Changed Since Last Report)
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 (see General Instructions A.2. below):
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
Title of each class Trading Symbol(s) Name of each exchange on which registered
Class A Common Stock, $0.0001 par value SQSP New York Stock Exchange
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (P30.405 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.☐



Item 1.01    Entry into a Material Definitive Agreement.
On May 13, 2024, Squarespace, Inc., a Delaware corporation (the “Company”), entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Spaceship Purchaser, Inc., a Delaware corporation (“Parent”), and Spaceship Group MergerCo, Inc., a Delaware corporation and wholly owned subsidiary of Parent (“Merger Sub”, and together with Parent, the “Buyer Parties”), providing for the merger of Merger Sub with and into the Company, with the Company continuing as the surviving corporation (the “Merger”). Capitalized terms used herein but not otherwise defined have the meaning set forth in the Merger Agreement.
A special committee (the “Special Committee”) of independent and disinterested members of the Company’s board of directors (the “Company Board”) unanimously adopted resolutions recommending that the Company Board approve and adopt the Merger Agreement and the transactions contemplated thereby and submit to the Company’s stockholders, and recommend the adoption of, the Merger Agreement. Thereafter, the Company Board unanimously authorized, adopted and approved the Merger Agreement and agreed to recommend that the stockholders of the Company adopt the Merger Agreement. The Special Committee determined that the Merger Agreement and the transactions contemplated thereby are advisable, fair to and in the best interest of the Company and the Unaffiliated Company Stockholders. The Company Board determined that the Merger Agreement and the transactions contemplated thereby are advisable, fair to and in the best interest of the Company and its stockholders.
At the effective time of the Merger (the “Effective Time”):
(i) each share of Company common stock outstanding as of immediately prior to the Effective Time (other than shares held by the Company, the Buyer Parties and any of their subsidiaries and the shares of Company common stock rolled over by (i) Anthony Casalena, the Anthony Casalena 2019 Family Trust, the Anthony Casalena Revocable Trust and the Casalena Foundation (“Casalena”), (ii) General Atlantic (SQRS II), L.P. (“General Atlantic”) and (iii) Accel Leaders 3 L.P. and affiliated funds (“Accel”) as described below) (the “Owned Company Shares”) and shares of Company common stock held by stockholders who have properly and validly exercised their statutory rights of appraisal in respect of such shares in accordance with Section 262 of the DGCL (the “Dissenting Company Shares”)) will be cancelled and extinguished and automatically converted into the right to receive cash in an amount equal to $44.00, without interest thereon (the “Per Share Price”); and
(ii) each Owned Company Share will be cancelled and extinguished without any conversion thereof or consideration paid therefor (provided that the Rollover Shares will be contributed to Parent immediately prior to Closing as described below).
In addition, pursuant to the Merger Agreement, at the Effective Time:
(i) each outstanding Company restricted stock unit award (each, a “Company RSU”) and Company performance-based restricted stock unit award (each, a “Company PSU”) that is either vested by its terms or held by a non-employee of the Company will be cancelled and converted into the right to receive a lump sum cash payment, without interest, equal to the product of the Per Share Price multiplied by the number of shares of Company common stock subject to the applicable Company RSU or Company PSU;
(ii) each outstanding option to purchase shares of Company common stock (each, a “Company Option”) (other than any Company Option with a per share exercise price at or above the Per Share Price (each, an “Out-of-the-Money Option”)) that is vested by its terms will be cancelled and converted into the right to receive a lump sum cash payment, without interest, equal to the product of the excess of the Per Share Price over the applicable exercise price per share of Company common stock subject to such Company Option multiplied by the number of shares of Company common stock subject to such Company Option;
(iii) each Company PSU that is scheduled to automatically forfeit as of the Effective Time pursuant to its terms will be forfeited as of the Effective Time for no consideration (each, a “Forfeited Company PSU”);
(iv) each outstanding Company Option (other than any Out-of-the-Money Option) that is then outstanding and not vested will be cancelled and converted into a contractual right to receive a payment in an amount of cash equal to the product of the excess of the Per Share Price over the applicable exercise per share of Company Common Stock subject to such Company Option multiplied by the number of shares of Company common stock subject to such Company Option (each, a “Converted Option Award”) and each Out-of-the Money Option will be cancelled at the Effective Time for no consideration; and
(v) each Company RSU and Company PSU (other than Forfeited Company PSUs) that is then outstanding and not vested by its terms (other than any such award held by a non-employee of the Company) will be cancelled and converted into the contractual right to receive a payment in an amount of cash equal to the product of the Per Share Price multiplied by the number of shares of Company common stock subject to the applicable Company RSU or Company PSU
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(with the number of shares of Company common stock subject to Company PSUs determined in accordance with the applicable award agreement) (each, a “Converted Full Value Award”, and together with the Converted Option Awards, the “Converted Equity Awards”).
Each Converted Equity Award will remain subject to the same vesting terms and conditions that applied to the associated Company Option, Company RSU or Company PSU, as applicable, immediately prior to the Effective Time.
Holders of Dissenting Company Shares will be entitled to receive payment of the appraised value of such Dissenting Company Shares in accordance with the provisions of Section 262 of the DGCL.
If the Merger is consummated, the Company common stock will be de-listed from The New York Stock Exchange and de-registered under the Securities Exchange Act of 1934, as amended, as promptly as practicable following the Effective Time.
Conditions to the Merger
Consummation of the Merger is subject to certain conditions set forth in the Merger Agreement, including, but not limited to, the: (i) affirmative vote of the holders of a majority in voting power of the outstanding shares of Company Common Stock beneficially owned, directly or indirectly, by the Unaffiliated Company Stockholders to adopt the Merger Agreement; (ii) affirmative vote of the holders of a majority in voting power of the outstanding Company Common Stock to adopt the Merger Agreement; (iii) affirmative vote of the holders of a majority of the outstanding shares of Class A Common Stock to adopt the Merger Agreement; (iv) affirmative vote of the holders of a majority of the outstanding shares of Class B Common Stock to adopt the Merger Agreement; (v) expiration or termination of any waiting periods applicable to the consummation of the Merger under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the “HSR Act”); (vi) accuracy of the Company’s representations and warranties contained in the Merger Agreement (except, generally, for any inaccuracies that have not had a Company Material Adverse Effect (as defined in the Merger Agreement)); (vii) absence of any law or injunction restraining or otherwise prohibiting the Merger; and (viii) absence of a Company Material Adverse Effect.
No-Shop Period
From the date of execution of the Merger Agreement (the “No-Shop Period Start Date”) until the earlier to occur of the termination of the Merger Agreement and the Effective Time, the Company will be subject to customary “no-shop” restrictions on its ability to solicit alternative Acquisition Proposals from third parties and to provide information to, and participate in discussions and engage in negotiations with, third parties regarding any alternative Acquisition Proposals, subject to a customary “fiduciary out” provision that allows the Company and the Special Committee, under certain specified circumstances, to provide information to, and participate in discussions and engage in negotiations with, third parties with respect to an Acquisition Proposal if the Special Committee determines in good faith (after consultation with its financial advisor and outside legal counsel) that such alternative Acquisition Proposal constitutes a Superior Proposal or is reasonably likely to lead to a Superior Proposal, and the failure to take such actions would be inconsistent with its fiduciary duties pursuant to applicable law.
Regulatory Efforts
The parties to the Merger Agreement have agreed to use their respective reasonable best efforts to consummate and make effective, as promptly as practicable, the Merger, including by using reasonable best efforts to cause the conditions to the Merger to be satisfied. If necessary to receive clearance of the Merger pursuant to the HSR Act, the Buyer Parties must commit to and effect, by consent decree, hold separate order or otherwise, the sale or other disposition of such assets or businesses of the Company as are required to avoid the entry of, effect the dissolution of or vacate or lift any order that would have the effect of preventing or materially delaying the consummation of the Merger.
Termination and Fees
The Merger Agreement contains certain termination rights for the Buyer Parties. Upon termination of the Merger Agreement under specified circumstances, including the Company terminating the Merger Agreement to enter into an Alternative Acquisition Agreement with respect to a Superior Proposal in accordance with the “fiduciary out” provisions of the Merger Agreement or Parent terminating the Merger Agreement in the event of a Recommendation Change, the Company will be required to pay Parent a termination fee of $198,700,000. The $198,700,000 termination fee will also be payable by the Company if the Merger Agreement is terminated under certain circumstances and prior to such termination, an Acquisition Proposal for an Acquisition Transaction is publicly announced or disclosed and any Acquisition Transaction is consummated or the Company enters into an agreement providing for the consummation of any Acquisition Transaction within 12 months of the termination.
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The Merger Agreement also contains certain termination rights for the Company. Upon termination of the Merger Agreement under specified circumstances, Parent will be required to pay the Company a termination fee of $231,816,666.67.
In addition to the foregoing termination rights, and subject to certain limitations, the Company or Parent may terminate the Merger Agreement if the Merger is not consummated by May 12, 2025.
Other Terms of the Merger Agreement
The Company also made customary representations and warranties in the Merger Agreement and agreed to customary covenants regarding the operation of the business of the Company and its Subsidiaries prior to the consummation of the Merger. The Merger Agreement also provides that the Company, on the one hand, or the Buyer Parties, on the other hand, may specifically enforce the obligations under the Merger Agreement, including the obligation to consummate the Merger if the conditions set forth in the Merger Agreement are satisfied and subject to certain other conditions. The Buyer Parties’ liability for monetary damages for breaches of the Merger Agreement are capped at $198,700,000 plus reasonable costs and expenses and interest.
The foregoing description of the Merger Agreement and the transactions contemplated thereby does not purport to be complete, and is subject to, and qualified in its entirety by reference to, the full text of the Merger Agreement, which is attached as Exhibit 2.1 and is incorporated by reference herein. The Merger Agreement has been included to provide investors with information regarding its terms. It is not intended to provide any other factual information about the Company, Parent, Merger Sub or their respective Subsidiaries or Affiliates. The representations, warranties and covenants contained in the Merger Agreement were made only for purposes of the Merger Agreement as of the specific dates therein, were solely for the benefit of the parties to the Merger Agreement, may be subject to limitations agreed upon by the contracting parties, including being qualified by confidential disclosures made for the purposes of allocating contractual risk among the parties to the Merger Agreement instead of establishing these matters as facts, and may be subject to standards of materiality applicable to the contracting parties that differ from those applicable to investors. Investors should not rely on the representations, warranties and covenants or any descriptions thereof as characterizations of the actual state of facts or condition of the parties thereto or any of their respective subsidiaries or affiliates. Moreover, information concerning the subject matter of representations and warranties may change after the date of the Merger Agreement, which subsequent information may or may not be reflected in the Company’s public disclosures. The Merger Agreement should not be read alone, but should instead be read in conjunction with the other information regarding the Company, Parent and Merger Sub and the transactions contemplated by the Merger Agreement that will be contained in or attached as an annex to the proxy statement that the Company will file in connection with the transactions contemplated by the Merger Agreement, as well as in the other filings that the Company will make with the U.S. Securities and Exchange Commission, including a Schedule 13E-3.
Financing
Also on May 13, 2024, in connection with the execution of the Merger Agreement, Parent has delivered (a) equity commitment letters between Parent and the financing sources identified therein, pursuant to which such financing sources have committed, subject to the terms and conditions contained therein, to invest in Parent, directly or indirectly, the cash amounts set forth therein (the “Equity Commitment Letters”) and (b) a debt commitment letter executed by the financing sources identified therein, pursuant to which such financing sources have committed, subject to the terms and conditions contained therein, to provide Parent with debt financing in the amounts specified therein (the “Debt Commitment Letter”). The proceeds of the Equity Commitment Letters and the Debt Commitment Letter are intended to fund the merger consideration payable in the Merger, on the terms and subject to the conditions set forth therein. The Company is an express limited third party beneficiary of certain rights in the Equity Commitment Letters, on the terms and subject to the conditions set forth therein.
Fee Funding Agreements
Also on May 13, 2024, in connection with the execution of the Merger Agreement, Parent has delivered fee funding agreements from Permira VIII - 1 SCSp, Permira VIII - 2 SCSp, Permira VIII AIV LP1 L.P., Permira VIII AIV LP2 L.P., Permira VIII CIS SCSp, Permira VIII CIS 2 SCSp, PILI 1 Portfolio SCSp, PILI 2 Portfolio SCSp, PILI 4 Portfolio SCSp, Permira Investment Capital LP, Permira Investment Capital II LP and Permira Investment Capital III LP (the “FFA Investors”) in favor of the Company and pursuant to which, on the terms and subject to the conditions contained therein, the FFA Investors are guaranteeing certain obligations of the Buyer Parties in connection with the Merger Agreement.
Support Agreement
Also on May 13, 2024, in connection with the Company’s execution of the Merger Agreement, (i) Casalena, (ii) General Atlantic and (iii) Accel entered into Support Agreements (the “Support Agreements”) with Parent and the Company,
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pursuant to which such stockholders have agreed, among other things, to vote their shares of Company common stock in favor of the adoption of the Merger Agreement and the approval of the Merger and against any other action, agreement or proposal which would reasonably be expected to prevent, materially impair or materially delay the consummation of the Merger or any of the transactions contemplated by the Merger Agreement. The Support Agreements also include certain restrictions on transfer of shares of Company common stock by the stockholders.
Under the Support Agreements, immediately prior to the Effective Time, each of General Atlantic, Accel and Casalena will contribute to a direct or indirect parent company of Parent a portion of its holdings of Company common stock in exchange for equity interests in such a direct or indirect parent company of Parent, such that Casalena, General Atlantic and Accel will indirectly own approximately 32.7%, 8.3% and 8.8% of the Company, respectively, following consummation of the Merger. As a result of the Merger, the shares of Company common stock contributed to such parent company of Parent by Casalena, General Atlantic and Accel will be cancelled and extinguished without any conversion thereof or consideration paid therefor along with the other Owned Company Shares.
The foregoing description of the Support Agreements and the transactions contemplated thereby does not purport to be complete, and is subject to, and qualified in its entirety by reference to, the full text of the Support Agreements, which are attached as Exhibit 10.1, Exhibit 10.2 and Exhibit 10.3 and are each incorporated by reference herein. The Support Agreements have been included to provide investors with information regarding their terms. They are not intended to provide any other factual information about the Company, Parent, Merger Sub, Casalena, General Atlantic, Accel, or their respective Subsidiaries or Affiliates. The representations, warranties and covenants contained in the Support Agreements were made only for purposes of the Support Agreements as of the specific dates therein, were solely for the benefit of the applicable parties to the Support Agreements, may be subject to limitations agreed upon by the contracting parties, and may be subject to standards of materiality applicable to the contracting parties that differ from those applicable to investors. Investors should not rely on the representations, warranties and covenants or any descriptions thereof as characterizations of the actual state of facts or condition of the parties thereto or any of their respective subsidiaries or affiliates. Moreover, information concerning the subject matter of representations and warranties may change after the date of the Support Agreements, which subsequent information may or may not be reflected in the Company’s public disclosures. The Support Agreements should not be read alone, but should instead be read in conjunction with the other information regarding the Company, Parent, Merger Sub, Casalena, General Atlantic and Accel and the transactions contemplated by the Support Agreements that will be contained in or attached as an annex to the proxy statement that the Company will file in connection with the transactions contemplated by the Support Agreements, as well as in the other filings that the Company will make with the U.S. Securities and Exchange Commission, including a Schedule 13E-3.
Item 8.01    Other Events.
On May 13, 2024, the Company issued a press release announcing its entry into the Merger Agreement. A copy of the press release is attached as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated herein by reference.
Item 9.01    Financial Statements and Exhibits.
(d) Exhibits
Exhibit No.Description
2.1
10.1
10.2
10.3
99.1
104Cover Page Interactive Data File - the cover page XBRL tags are embedded within the Inline XBRL document
__________________
*The schedules and exhibits have been omitted pursuant to Item 601(b)(2) of Regulation S-K. The Company agrees to furnish supplementally a copy of such schedules and exhibits, or any section thereof, to the SEC upon request.
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Cautionary Statement Regarding Forward-Looking Statements
This communication includes certain “forward-looking statements” within the meaning of, and subject to the safe harbor created by, the federal securities laws, including statements related to the proposed merger of the Company with an affiliate of Permira Advisers (the “Transaction”), including financial estimates and statements as to the expected timing, completion and effects of the Transaction. These forward-looking statements are based on the Company’s current expectations, estimates and projections regarding, among other things, the expected date of closing of the Transaction and the potential benefits thereof, its business and industry, management’s beliefs and certain assumptions made by the Company, all of which are subject to change. Forward-looking statements often contain words such as “expect,” “anticipate,” “intend,” “aims,” “plan,” “believe,” “could,” “seek,” “see,” “will,” “may,” “would,” “might,” “considered,” “potential,” “estimate,” “continue,” “likely,” “expect,” “target” or similar expressions or the negatives of these words or other comparable terminology that convey uncertainty of future events or outcomes. By their nature, forward-looking statements address matters that involve risks and uncertainties because they relate to events and depend upon future circumstances that may or may not occur, such as the consummation of the Transaction and the anticipated benefits thereof. These and other forward-looking statements are not guarantees of future results and are subject to risks, uncertainties and assumptions that could cause actual results to differ materially from those expressed in any forward-looking statements. Important risk factors that may cause such a difference include, but are not limited to: (i) the completion of the Transaction on anticipated terms and timing, including obtaining required stockholder and regulatory approvals, and the satisfaction of other conditions to the completion of the Transaction; (ii) the ability of affiliates of Permira to obtain the necessary financing arrangements set forth in the commitment letters received in connection with the Transaction; (iii) potential litigation relating to the Transaction that could be instituted against Permira, the Company or their respective directors, managers or officers, including the effects of any outcomes related thereto; (iv) the risk that disruptions from the Transaction will harm the Company’s business, including current plans and operations; (v) the ability of the Company to retain and hire key personnel; (vi) potential adverse reactions or changes to business relationships resulting from the announcement or completion of the Transaction; (vii) continued availability of capital and financing and rating agency actions; (viii) legislative, regulatory and economic developments affecting the Company’s business; (ix) general economic and market developments and conditions; (x) potential business uncertainty, including changes to existing business relationships, during the pendency of the Transaction that could affect the Company’s financial performance; (xi) certain restrictions during the pendency of the Transaction that may impact the Company’s ability to pursue certain business opportunities or strategic transactions; (xii) unpredictability and severity of catastrophic events, including but not limited to acts of terrorism, pandemics, outbreaks of war or hostilities, as well as the Company’s response to any of the aforementioned factors; (xiii) significant transaction costs associated with the Transaction; (xiv) the possibility that the Transaction may be more expensive to complete than anticipated, including as a result of unexpected factors or events; (xv) the occurrence of any event, change or other circumstance that could give rise to the termination of the Transaction, including in circumstances requiring the Company to pay a termination fee or other expenses; (xvi) competitive responses to the Transaction; (xvii) the risks and uncertainties pertaining to the Company’s business, including those set forth in Part I, Item 1A of the Company’s most recent Annual Report on Form 10-K and Part II, Item 1A of the Company’s subsequent Quarterly Reports on Form 10-Q, as such risk factors may be amended, supplemented or superseded from time to time by other reports filed by the Company with the SEC; and (xviii) the risks and uncertainties that will be described in the Proxy Statement available from the sources indicated below. These risks, as well as other risks associated with the Transaction, will be more fully discussed in the Proxy Statement. While the list of factors presented here is, and the list of factors to be presented in the Proxy Statement will be, considered representative, no such list should be considered a complete statement of all potential risks and uncertainties. Unlisted factors may present significant additional obstacles to the realization of forward-looking statements. Consequences of material differences in results as compared with those anticipated in the forward-looking statements could include, among other things, business disruption, operational problems, financial loss, legal liability to third parties and similar risks, any of which could have a material impact on the Company’s financial condition, results of operations, credit rating or liquidity. These forward-looking statements speak only as of the date they are made, and the Company does not undertake to and specifically disclaims any obligation to publicly release the results of any updates or revisions to these forward-looking statements that may be made to reflect future events or circumstances after the date of such statements or to reflect the occurrence of anticipated or unanticipated events.
Important Additional Information and Where to Find It
In connection with the Transaction, the Company will file with the SEC a Proxy Statement on Schedule 14A (the “Proxy Statement”), the definitive version of which will be sent or provided to Company stockholders. The Company and affiliates of the Company intend to jointly file a transaction statement on Schedule 13E-3 (the “Schedule 13E-3”). The Company may also file other documents with the SEC regarding the Transaction. This Current Report on Form 8-K is not a substitute for the Proxy Statement, the Schedule 13E-3 or any other document which the Company may file with the SEC. INVESTORS AND SECURITY HOLDERS ARE URGED TO READ THE PROXY STATEMENT, THE SCHEDULE 13E-3 AND ANY OTHER RELEVANT DOCUMENTS THAT ARE FILED OR WILL BE FILED WITH
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THE SEC, AS WELL AS ANY AMENDMENTS OR SUPPLEMENTS TO THESE DOCUMENTS, CAREFULLY AND IN THEIR ENTIRETY BECAUSE THEY CONTAIN OR WILL CONTAIN IMPORTANT INFORMATION ABOUT THE TRANSACTION AND RELATED MATTERS. Investors and security holders may obtain free copies of the Proxy Statement, Schedule 13E-3 and other documents (when they become available) that are filed or will be filed with the SEC by the Company through the website maintained by the SEC at www.sec.gov, the Company’s website at https://investors.squarespace.com or by contacting the Company’s Investor Relations Team at investors@squarespace.com.
The Transaction will be implemented solely pursuant to the Merger Agreement dated as of May 13, 2024, among the Company, Parent, and Merger Sub, which contains the full terms and conditions of the Transaction.
Participants in the Solicitation
The Company and certain of its directors, executive officers and other employees may be deemed to be participants in the solicitation of proxies from the Company’s stockholders in connection with the Transaction. Additional information regarding the identity of the participants, including a description of their direct or indirect interests, by security holdings or otherwise, will be set forth in the Proxy Statement and other materials to be filed with the SEC in connection with the Transaction (if and when they become available). Information relating to the foregoing can also be found in the Company’s proxy statement for its 2024 annual meeting of stockholders, which was filed with the SEC on April 22, 2024 (the “Annual Meeting Proxy Statement”). To the extent holdings of securities by potential participants (or the identity of such participants) have changed since the information printed in the Annual Meeting Proxy Statement, such information has been or will be reflected on the Company’s Statements of Change in Ownership on Forms 3 and 4 filed with the SEC. You may obtain free copies of these documents using the sources indicated above.
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SIGNATURES

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

 SQUARESPACE, INC.
  
Dated: May 13, 2024By: /s/ Courtenay O’Connor
  Courtenay O’Connor
  General Counsel and Secretary
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