What changed in this filing

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Item 1. Business

2023-02-22 compared with 2022-03-28 · 54 added, 22 removed, 184 unchanged (29% of the section changed)

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On February 15, 2021, we issued an unsecured convertible promissory note to our sponsor, pursuant to which we may borrow up to $1,500,000 from our sponsor for ongoing expenses reasonably related to our business and the consummation of our initial business combination.

All unpaid principal under the convertible note will be due and payable in full on the earlier of (i) February 11, 2023 and (ii) the effective date of our initial business combination.

All unpaid principal under the convertible note will be due and payable in full on the earlier of (i) August 11, 2023 and (ii) the effective date of our initial business combination.

Our sponsor will have the option, at any time on or prior to such maturity date, to convert any amounts outstanding under the convertible note into warrants to purchase shares of our Class A Common Stock, par value $0.0001 per share, at a conversion price of $1.50 per warrant, with each warrant entitling the holder to purchase one share of our Class A Common Stock at a price of $11.50 per share, subject to the same adjustments applicable to the private placement warrants sold concurrently with our initial public offering (“working capital warrants”).

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Grodnensky’s own experience, as well as their network of relationships with chief executive officers, board members and members of executive management teams to provide specialized insights into their areas of expertise as well as leverage their operational and capital planning experience.

Business Combination Agreement – Proposed Business Combination with AEON Biopharma, Inc.

On December 12, 2022, we entered into a business combination agreement (the “Business Combination Agreement”) with Priveterra Merger Sub, Inc., a Delaware corporation (“Merger Sub”) and AEON Biopharma, Inc., a Delaware corporation (“AEON”).

The Business Combination Agreement provides, among other things, that on the terms and subject to the conditions set forth therein, Merger Sub will merge with and into AEON, with AEON surviving as a wholly-owned subsidiary of the company (the “Merger”).

Upon the closing of the Merger (the “Closing”), the company will change its name to “AEON Biopharma, Inc.” and its ticker symbol on the Nasdaq Capital Market (“Nasdaq”) is expected to change to “AEON”.

The date on which the Closing occurs is hereinafter referred to as the “Closing Date.” The proposed business combination with AEON was announced in the company’s Current Report on Form 8-K filed with the SEC on December 12, 2022.

The Business Combination Agreement and the transactions contemplated thereby were approved by the boards of directors of each of the company and AEON.

We intend to effectuate our proposed initial business combination with AEON using a combination of cash from the proceeds of our initial public offering (and the concurrent private placement of the private placement warrants), the proceeds of the sale of our shares to private investors in connection with our initial business combination and shares issued to the stockholders of AEON, as described below.

In connection with the execution of the Business Combination Agreement, AEON and the company entered into interim financing letter agreements for an aggregate amount of $20 million (the “Letter Agreements”) with certain investors (the “Investors”), the terms of which provide for the sale and issuance to the Investors of an issued security that will be exchanged or converted at the Closing into Class A Common Stock of the company at a purchase price of $7.00 per the company share.

The Letter Agreements will terminate upon the earliest of (a) such date and time as the Business Combination Agreement is validly terminated, (b) upon mutual written agreement of each of the parties to the Letter Agreements, (c) at any time upon the election of the company and AEON at their sole discretion and (d) nine months from the date of the Letter Agreements if the closing of the Business Combination Agreement has not occurred.

Pursuant to the Business Combination Agreement, at the effective time of the Merger (the “Effective Time”), (i) each outstanding share of AEON common stock (on an as converted basis after taking into effect the conversion of the outstanding warrants of AEON exercisable for shares of AEON preferred stock, the conversion of the shares of AEON preferred stock into AEON common stock in accordance with the governing documents of AEON as of the Effective Time, the conversion of the outstanding convertible notes of AEON into AEON common stock in accordance with the terms of such convertible notes and after giving effect to the issuance of AEON common stock, if any, in connection with the subsidiary merger (the time on the Closing Date and immediately prior to the Merger when ABP Sub, Inc.

(“ABP Sub”) shall merge with and into AEON being referred to herein as the “Subsidiary Merger”)) will be cancelled and converted into the right to receive a number of shares of New AEON common stock equal to the Merger Consideration;

and (ii) each outstanding AEON option (including each Subsidiary Rollover Option) will be converted into an option to purchase a number of shares of New AEON common stock equal to (A) the number of shares of AEON common stock subject to such option immediately prior to the Effective Time, multiplied by (B) the Exchange Ratio, at an exercise price per share equal to the exercise price per share for such option as of immediately prior to the Closing divided by the Exchange Ratio.

In addition, upon the achievement of certain clinical development milestones, certain AEON Stockholders will be entitled to receive up to 16,000,000 additional shares of New AEON common stock (the “Earnout Shares”), which will be issued as follows:

(i) 1,000,000 shares of New AEON common stock, if, on or before June 30, 2025, AEON has commenced a Phase 3 clinical study for the treatment of chronic or episodic migraine;

(ii) 4,000,000 shares of New AEON common stock, if, on or before November 30, 2026, AEON has received from the FDA acceptance for review of the Biologics License Application within the meaning of the rules and regulations of the FDA (the “BLA”) submitted by AEON for the treatment of cervical dystonia;

(iii) 4,000,000 shares of New AEON common stock, if, on or before June 30, 2029, AEON has received from the FDA acceptance for review of the BLA submitted by AEON for the treatment of episodic migraine, provided that this number will increase to 11,000,000 shares of New AEON common stock if this milestone is reached prior to FDA acceptance for review of the BLA submitted by AEON for the treatment of chronic migraine;

and (iv) 7,000,000 shares of New AEON common stock if, on or before June 30, 2028, AEON has received from the FDA acceptance for review of the BLA submitted by AEON for the treatment of chronic migraine, provided, however, that if AEON has achieved the episodic migraine milestone pursuant to the proviso to the foregoing clause (iii) entitling AEON Stockholders to 11,000,000 shares of New AEON common stock, this contingent consideration will be reduced to 0 shares of New AEON common stock.

Additionally, the first payment of any Earnout Shares upon the achievement of the milestones above will include, in addition to such Earnout Shares, a number of the shares of Class B Common Stock initially purchased by the Sponsor and the shares of Class A Common Stock issuable upon conversion thereof (the “Founder Shares”) equal to the Sponsor Forfeiture Amount in accordance with the sponsor support agreement the Sponsor entered into with the company and AEON (the “Sponsor Support Agreement”).

These 16,000,000 shares of New AEON common stock are referred to as the “Contingent Consideration.” Subject to certain exceptions, if a change of control of New AEON occurs following the Closing, then any Contingent Consideration that remains unissued as of immediately prior to the consummation of such change of control will immediately become payable and certain of the former holders of shares of AEON preferred stock and AEON common stock will be entitled to receive the unissued Contingent Consideration prior to the consummation of such change of control.

The parties to the Business Combination Agreement have agreed to customary representations and warranties for transactions of this type.

In addition, the parties to the Business Combination Agreement agreed to be bound by certain customary covenants for transactions of this type, including, among others, covenants with respect to the conduct of AEON, the company and their respective subsidiaries during the period between execution of the Business Combination Agreement and Closing.

The representations, warranties, agreements and covenants of the parties set forth in the Business Combination Agreement will terminate at Closing, except for those covenants and agreements that, by their terms, contemplate performance after Closing, and certain representations and warranties, as noted in the Business Combination Agreement.

Each of the parties to the Business Combination Agreement has agreed to use its reasonable best efforts to take or cause to be taken all actions, and to do or cause to be done all things, reasonably necessary to consummate and expeditiously implement the Merger.

Under the Business Combination Agreement, the obligations of the parties to consummate the Merger are subject to the satisfaction or waiver of certain customary closing conditions of the respective parties, including, without limitation:

(i) the approval and adoption of the Business Combination Agreement and the transactions contemplated thereby by the requisite vote of the company’s stockholders and AEON’s stockholders;

(ii) the expiration or termination of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended;

(iii) the absence of a continuing Company Material Adverse Effect or AEON Material Adverse Effect (each as defined in the Business Combination Agreement) since the date of the Business Combination Agreement;

(iv) after giving effect to the transactions contemplated by the Business Combination Agreement, the company having net tangible assets of at least $5,000,001 upon consummation of the Merger;

(v) the company’s initial listing application with Nasdaq in connection with the Merger having been approved and, immediately following the Effective Time, the company having the ability to satisfy the applicable initial and continuing listing requirements of Nasdaq and the shares of the company’s Class A Common Stock have been approved for listing on Nasdaq, subject only to official notice of the issuance thereof;

and (vi) the registration statement filed by the company in connection with the transactions contemplated by, and as required by, the Business Combination Agreement, the first draft of which was filed with the SEC on Form S-4 on December 27, 2022 (the “Registration Statement”), has become effective, no stop order has been issued by the SEC and remains in effect with respect to the Registration Statement, and no proceeding seeking such a stop order has been threatened or initiated by the SEC and remains pending.

In addition, AEON’s obligation to consummate the Merger is subject to the condition that the Available Closing Cash (as defined in the Business Combination Agreement) shall be greater than or equal to $45,000,000.

Because the parties’ obligations to consummate the Merger are subject to the satisfaction or waiver of these (and other) conditions, there is no guarantee that the Merger will be consummated.

The foregoing description of the Business Combination Agreement does not purport to be complete and is qualified in its entirety by the terms and conditions of the Business Combination Agreement, a copy of which was exhibited as Exhibit 2.1 to the Current

Report on Form 8-K filed by the company with the SEC on December 12, 2022, the terms of which are incorporated herein by reference.

The Business Combination Agreement also contemplates the execution of various additional agreements and instruments on or before the Closing, including, among others, the sponsor support agreement, the AEON stockholder support agreements, the AEON noteholder support agreements and the interim financing agreements, each of which, or the form of which, is described in and exhibited to (whether directly, or as an annexure or exhibit to another document exhibited to) the Current Report on Form 8-K filed by the company with the SEC on December 12, 2022, the terms of each of which are incorporated herein by reference.

Corporate Information

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The decision as to whether we will seek stockholder approval of a proposed initial business combination or conduct a tender offer will be made by us, solely in our discretion, and will be based on a variety of factors such as the timing of the transaction and whether the terms of the transaction would require us to seek stockholder approval under applicable law or stock exchange listing requirements.

Asset acquisitions and stock purchases would not typically require stockholder approval while direct mergers with our company where we do not survive and any transactions where we

issue more than 20% of our outstanding common stock or seek to amend our amended and restated certificate of incorporation would require stockholder approval.

Asset acquisitions and stock purchases would not typically require stockholder approval while direct mergers with our company where we do not survive and any transactions where we issue more than 20% of our outstanding common stock or seek to amend our amended and restated certificate of incorporation would require stockholder approval.

So long as we obtain and maintain a listing for our securities on Nasdaq, we will be required to comply with Nasdaq’s stockholder approval rules.

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In the event we conduct redemptions pursuant to the tender offer rules, our offer to redeem will remain open for at least 20 business days, in accordance with Rule 14e-1(a) under the Exchange Act, and we will not be permitted to complete our initial business combination until the expiration of the tender offer period.

In addition, the tender offer will be conditioned on public stockholders not tendering more than a specified number of public shares, which number will be based on the requirement that we may not redeem public shares in an amount that would cause our net tangible assets to be less than $5,000,001.

public shares in an amount that would cause our net tangible assets to be less than $5,000,001.

If public stockholders tender more shares than we have offered to purchase, we will withdraw the tender offer and not complete the initial business combination.

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In the case of proxy materials, this date may be up to two business days prior to the date on which the vote on the proposal to approve the initial business combination is to be held.

In addition, if we conduct redemptions in connection with a stockholder vote, we intend to require a public stockholder seeking redemption of its public shares to also submit a written request for redemption to our transfer agent two business

days prior to the vote in which the name of the beneficial owner of such shares is included.

The proxy materials or tender offer documents, as applicable, that we will furnish to holders of our public shares in connection with our initial business combination will indicate whether we are requiring public stockholders to satisfy such delivery requirements.

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There will be no redemption rights or liquidating distributions with respect to our warrants, which will expire worthless if we fail to complete our initial business combination within the 24-month time period or during any Extension Period.

Our initial stockholders, sponsor, officers and directors have entered into a letter agreement with us, pursuant to which they have waived their rights to liquidating distributions from the trust account with respect to any founder shares they hold if we fail to complete our initial business combination by February 11, 2023 or during any Extension Period.

However, if our initial stockholders, sponsor or management team acquire public shares in or after our initial public offering, they will be entitled to liquidating distributions from the trust account with respect to such public shares if we fail to complete our initial business combination within the allotted 24-month time period.

redeem 100% of our public shares if we do not complete our initial business combination by February 11, 2023 or with respect to any other material provisions relating to stockholders’ rights or pre-initial business combination activity, unless we provide our public stockholders with the opportunity to redeem their public shares upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned on the funds held in the trust account (which interest shall be net of taxes payable), divided by the number of then outstanding public shares.

Our initial stockholders, sponsor, officers and directors have agreed, pursuant to a letter agreement with us, that they will not propose any amendment to our amended and restated certificate of incorporation to modify the substance or timing of our obligation to redeem 100% of our public shares if we do not complete our initial business combination by August 11, 2023 or with respect to any other material provisions relating to stockholders’ rights or pre-initial business combination activity, unless we provide our public stockholders with the opportunity to redeem their public shares upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned on the funds held in the trust account (which interest shall be net of taxes payable), divided by the number of then outstanding public shares.

However, we may not redeem our public shares in an amount that would cause our net tangible assets to be less than $5,000,001.

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In addition, there is no guarantee that such entities will agree to waive any claims they may have in the future as a result of, or arising out of, any negotiations, contracts or agreements with us and will not seek recourse against the trust account for any reason.

In order to protect the amounts held in the trust account, our sponsor has agreed that it will be liable to us if and to the extent any claims by a third party for services rendered or products sold to us, or a prospective target business with which we have entered into a written letter of intent, confidentiality or other similar agreement or business combination agreement, reduce the amount of funds in the trust account to below the lesser of (i) $10.00 per public share and (ii) the actual amount per public share held in the trust account as of the date of the liquidation of the trust account, if less than $10.00 per public share due to reductions in the value of the trust assets, less taxes payable, provided that such liability will not apply to any claims by a third party or prospective target business who executed a waiver of any and all rights to the monies held in the trust account (whether or not such waiver is enforceable) nor will it apply to any claims under our indemnity of the underwriters of our initial public offering against certain liabilities, including liabilities under the Securities Act.

below the lesser of (i) $10.00 per public share and (ii) the actual amount per public share held in the trust account as of the date of the liquidation of the trust account, if less than $10.00 per public share due to reductions in the value of the trust assets, less taxes payable, provided that such liability will not apply to any claims by a third party or prospective target business who executed a waiver of any and all rights to the monies held in the trust account (whether or not such waiver is enforceable) nor will it apply to any claims under our indemnity of the underwriters of our initial public offering against certain liabilities, including liabilities under the Securities Act.

However, we have not asked our sponsor to reserve for such indemnification obligations, nor have we independently verified whether our sponsor has sufficient funds to satisfy its indemnity obligations and we believe that our sponsor’s only assets are securities of our company.

Therefore, we cannot assure you that our sponsor would be able to satisfy those obligations.

As a result, if any such claims were successfully made against the trust account, the funds available for our initial business combination and redemptions could be

reduced to less than $10.00 per public share.

As a result, if any such claims were successfully made against the trust account, the funds available for our initial business combination and redemptions could be reduced to less than $10.00 per public share.

In such event, we may not be able to complete our initial business combination, and you would receive such lesser amount per share in connection with any redemption of your public shares.

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Under the DGCL, stockholders may be held liable for claims by third parties against a corporation to the extent of distributions received by them in a dissolution.

The pro rata portion of our trust account distributed to our public stockholders upon the redemption of our public shares in the event we do not complete our initial business combination by February 11, 2023 may be considered a liquidating distribution under Delaware law.

The pro rata portion of our trust account distributed to our public stockholders upon the redemption of our public shares in the event we do not complete our initial business combination by August 11, 2023 may be considered a liquidating distribution under Delaware law.

If the corporation complies with certain procedures set forth in Section 280 of the DGCL intended to ensure that it makes reasonable provision for all claims against it, including a 60-day notice period during which any third-party claims can be brought against the corporation, a 90-day period during which the corporation may reject any claims brought, and an additional 150-day waiting period before any liquidating distributions are made to stockholders, any liability of stockholders with respect to a liquidating distribution is limited to the lesser of such stockholder’s pro rata share of the claim or the amount distributed to the stockholder, and any liability of the stockholder would be barred after the third anniversary of the dissolution.

Furthermore, if the pro rata portion of our trust account distributed to our public stockholders upon the redemption of our public shares in the event we do not complete our initial business combination by February 11, 2023, is not considered a liquidating distribution under Delaware law and such redemption distribution is deemed to be unlawful (potentially due to the imposition of legal proceedings that a party may bring or due to other circumstances that are currently unknown), then pursuant to Section 174 of the DGCL, the statute of limitations for claims of creditors could then be six years after the unlawful redemption distribution, instead of three years, as in the case of a liquidating distribution.

If we are unable to complete our initial business combination by February 11, 2023, we will:

(i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem the public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account including interest earned on the funds held in the trust account (which interest shall be net of taxes payable and up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares, which redemption will completely extinguish public stockholders’ rights as stockholders (including the right to receive further liquidating distributions, if any) and (iii) as promptly as reasonably possible following such redemption, subject to the approval of our remaining stockholders and our board of directors, dissolve and liquidate, subject in each case to our obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law.

Furthermore, if the pro rata portion of our trust account distributed to our public stockholders upon the redemption of our public shares in the event we do not complete our initial business combination by August 11, 2023, is not considered a liquidating distribution under Delaware law and such redemption distribution is deemed to be unlawful (potentially due to the imposition of legal proceedings that a party may bring or due to other circumstances that are currently unknown), then pursuant to Section 174 of the DGCL, the statute of limitations for claims of creditors could then be six years after the unlawful redemption distribution, instead of three years, as in the case of a liquidating distribution.

If we are unable to complete our initial business combination by August 11, 2023, we will:

stockholders and our board of directors, dissolve and liquidate, subject in each case to our obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law.

Accordingly, it is our intention to redeem our public shares as soon as reasonably possible following our 24th month and, therefore, we do not intend to comply with those procedures.

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Because we will not be complying with Section 280, Section 281(b) of the DGCL requires us to adopt a plan, based on facts known to us at such time that will provide for our payment of all existing and pending claims or claims that may be potentially brought against us within the subsequent 10 years.

However, because we are a blank check company, rather than an operating

company, and our operations will be limited to searching for prospective target businesses to acquire, the only likely claims to arise would be from our vendors (such as lawyers, investment bankers, etc.) or prospective target businesses.

However, because we are a blank check company, rather than an operating company, and our operations will be limited to searching for prospective target businesses to acquire, the only likely claims to arise would be from our vendors (such as lawyers, investment bankers, etc.) or prospective target businesses.

As described above, pursuant to the obligation contained in our underwriting agreement, we will seek to have all vendors, service providers (other than our independent registered public accounting firm), prospective target businesses or other entities with which we do business execute agreements with us waiving any right, title, interest or claim of any kind in or to any monies held in the trust account.

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We cannot assure you that claims will not be brought against us for these reasons.

Our public stockholders will be entitled to receive funds from the trust account only (i) in the event of the redemption of our public shares if we do not complete our initial business combination by February 11, 2023, (ii) in connection with a stockholder vote to amend our amended and restated certificate of incorporation to modify the substance or timing of our obligation to redeem 100% of our public shares if we do not complete our initial business combination by February 11, 2023 or with respect to any other material provisions relating to stockholders’ rights or pre-initial business combination activity or (iii) if they redeem their respective shares for cash upon the completion of our initial business combination.

Our public stockholders will be entitled to receive funds from the trust account only (i) in the event of the redemption of our public shares if we do not complete our initial business combination by August 11, 2023, (ii) in connection with a stockholder vote to amend our amended and restated certificate of incorporation to modify the substance or timing of our obligation to redeem 100% of our public shares if we do not complete our initial business combination by August 11, 2023 or with respect to any other material provisions relating to stockholders’ rights or pre-initial business combination activity or (iii) if they redeem their respective shares for cash upon the completion of our initial business combination.

In no other circumstances will a stockholder have any right or interest of any kind to or in the trust account.

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Certain of our officers and directors presently have, and any of them in the future may have additional, fiduciary or contractual obligations to another entity pursuant to which such officer or director is or will be required to present a business combination opportunity to such entity.

Accordingly, if any of our officers or directors becomes aware of a business combination opportunity

which is suitable for an entity to which he or she has then current fiduciary or contractual obligations, he or she will honor his or her fiduciary or contractual obligations to present such business combination opportunity to such other entity.

Accordingly, if any of our officers or directors becomes aware of a business combination opportunity which is suitable for an entity to which he or she has then current fiduciary or contractual obligations, he or she will honor his or her fiduciary or contractual obligations to present such business combination opportunity to such other entity.

Our amended and restated certificate of incorporation provides that we renounce our interest in any corporate opportunity offered to any director or officer unless such opportunity is expressly offered to such person solely in his or her capacity as a director or officer of the company and such opportunity is one we are legally and contractually permitted to undertake and would otherwise be reasonable for us to pursue, and to the extent the director or officer is permitted to refer that opportunity to us without violating another legal obligation.

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Robert Palmisano, Vikram Malik and Oleg Grodnensky.

These individuals are not obligated to devote any specific number of hours to our matters but they intend to devote as much of their time as they deem necessary to our affairs until we have completed our initial business combination.

The amount of time they will devote in any time period will vary based on whether a target business has been selected for our initial business combination and the stage of the business combination process we are in.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business