Filing Overview
This Form 8-K was filed by Priveterra Acquisition Corp. on April 5, 2023, under Item 4.02. Although the request metadata identifies AEON Biopharma, Inc., the filing’s registrant is Priveterra Acquisition Corp., a special purpose acquisition company. The filing addresses the year ended December 31, 2022.
Financial and Accounting Matters
- Priveterra had recorded a contingent liability for a portion of the underwriter commissions from its November 2021 initial public offering.
- An underwriter waived a $3.8 million portion of the deferred commission in November 2022.
- Priveterra initially recorded the waiver as an extinguishment gain in its 2022 statement of operations.
- Management subsequently concluded that the waiver should have been recorded as a reversal using the same allocation applied at the initial public offering. The portion allocated to Class A common stock should be reversed against equity, while the portion allocated to derivative warrant liabilities should be reflected in the statement of operations.
- The filing states that the accounting correction did not affect previously reported cash, investments held in the trust account, operating expenses, liquidity, or total cash flows from operations.
Material Changes from the Prior Filing
- Management and the Audit Committee determined that the previously issued consolidated financial statements for the year ended December 31, 2022 should no longer be relied upon.
- Priveterra will restate those financial statements in Amendment No. 1 to its Form 10-K.
- The amendment includes revised risk factors, management’s discussion and analysis, financial statements and supplementary data, and controls-and-procedures disclosures.
- The filing states that the amendment does not modify or update other disclosures in the original Form 10-K.
Controls, Risks, and Outlook
- Management concluded that a material weakness existed in internal control over financial reporting.
- Disclosure controls and procedures were determined to be ineffective.
- The filing adds risk factors related to the accounting correction and control deficiencies, but it does not provide operating guidance or business-performance forecasts.
- No change to liquidity, cash flows, or operating expenses from the correction was reported.
Investor Verification Items
- Review Amendment No. 1 to Form 10-K for the restated allocation of the $3.8 million commission waiver and its effect on reported net income and equity.
- Assess the disclosed material weakness and any remediation actions.
- Confirm that cash, trust-account investments, liquidity, and operating cash flows remain unchanged after the restatement.
- Reconcile the filing’s registrant, Priveterra Acquisition Corp., with any AEON Biopharma transaction or successor-company filings.