UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2021

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to.

Priveterra Acquisition Corp.

(Exact name of registrant as specified in its charter)

Delaware

001-39945

85-3940478

(State or other jurisdiction of

incorporation)

(Commission File Number)

(I.R.S. Employer

Identification Number)

300 SE 2nd Street, Suite 600

Fort Lauderdale, FL

(754) 220-9229

Registrant’s Telephone Number, Including Area Code

Not Applicable

(Former name or former address, if changed since last report)

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, par value $0.0001 per share	PMGM	The Nasdaq Stock Market LLC
Redeemable warrants, each warrant exercisable for one share of Class A common stock at an exercise price of $11.50	PMGMW	The Nasdaq Stock Market LLC
Units, each consisting of one share of Class A common stock and one-third of one redeemable warrant	PMGMU	The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
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. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☒ No ☐

As of June 14, 2021, 31,000,000 shares of Class A common stock, par value $0.0001 per share, and 8,625,000 shares of Class B common stock, par value $0.0001 per share, were issued and outstanding, respectively.

	Page
PART I. FINANCIAL INFORMATION	3
Item 1. Financial Statements.	3
Condensed Balance Sheets as of March 31, 2021 (unaudited) and December 31, 2020 (audited)	3
Condensed Statement of Operations for the three months ended March 31, 2021 (unaudited)	4
Condensed Statement of Changes in Stockholders’ Equity for the three months ended March 31, 2021 (unaudited)	5
Condensed Statement of Cash Flows for the three months ended March 31, 2021 (unaudited)	6
Notes to Condensed Financial Statements	7
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.	20
Item 3. Quantitative and Qualitative Disclosures About Market Risk.	25
Item 4. Controls and Procedures.	25
PART II - OTHER INFORMATION	26
Item 1. Legal Proceedings.	26
Item 1A. Risk Factors.	26
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.	27
Item 3. Defaults upon Senior Securities.	28
Item 4. Mine Safety Disclosures.	28
Item 5. Other Information.	28
Item 6. Exhibits.	29


	March 31, 2021		December 31, 2020
	(Unaudited)
Assets
Cash	$	1,441,499	$	—
Deferred offering costs	$	1,000
Prepaid assets		696,830		—
Total Assets		2,138,329		81,000

Cash and marketable securities held in Trust Account		276,008,319		—
Total Assets	$	278,146,648	$	81,000

Liabilities and Stockholders’ Equity
Current liabilities:
Accrued offering costs and expenses	$	314,175	$	21,000
Franchise tax payable		50,000		—
Working capital loans – related party		100,000		—
Due to related party		3,817		—
Promissory note – related party		203,817		38,588
Total current liabilities		467,992		59,588
Warrant liability		10,862,133		—
Deferred underwriters’ discount		9,660,000		—
Total liabilities		20,990,125		59,588

Commitments and Contingencies

Common stock subject to possible redemption, 25,215,652 and 0 shares as of March 31, 2021 and December 31, 2020, at redemption value of $10.00, respectively		251,956,520		—

Stockholders’ Equity:
Preferred stock, $0.0001 par value; 1,000,000 shares authorized; none issued and outstanding		—		—
Class A common stock, $0.0001 par value; 280,000,000 shares authorized; 2,384,348 and 0 shares issued and outstanding (excluding 25,215,652 and 0 shares subject to possible redemption) as of March 31, 2021 and December 31, 2020, respectively		252		—
Class B common stock, $0.0001 par value; 20,000,000 shares authorized; 6,900,000 shares issued and outstanding		690		690
Additional paid-in capital		(1,304,287)		24,310
Retained Earnings
Accumulated Deficit		4,999,059		(3,588)
Total stockholder’s equity		5,000,001		21,412
Total Liabilities and stockholders’ Equity	$	278,146,648	$	81,000


	For the
	three months ended
	March 31, 2021

Formation and operating costs	$	200,863
Loss from operations		200,863

Other income/(expense)
Unrealized gain on change in fair value of warrants		7,166,800
Transaction costs		655,046
Interest income		8,319
Total other income		6,520,073
Net Income	$	6,319,210

Basic and diluted weighted average shares outstanding, Class A common stock subject to possible redemption		27,600,000
Basic and diluted net income per share, Class A common stock subject to possible redemption	$	0.00

Basic and diluted weighted average shares outstanding, Class B common stock		6,900,000
Basic and diluted net loss per share, Class B common stock	$	0.92


	Common Stock						Additional		Retained Earnings		Total
	Class A			Class B			Paid-In		(Accumulated)		Stockholders’
	Shares	Amount		Shares	Amount		Capital		(Deficit)		Equity
Balance—December 31, 2020	—	$	—	6,900,000	$	690	$	24,310	$	(3,588)	$	21,412
Sale of 27,600,000 Units on February 11, 2021, net of warrant fair value	27,600,000		2,760	—		—		264,589,241		—		264,592,000
Excess cash over fair value for Private Placement Warrants	—		—	—		—		1,199,067		—		1,199,067
Offering costs	—		—	—		—		14,975,166		—		14,975,166
Net income	—		—	—		—		—		6,319,210		6,319,210
The maximum number of redeemable shares	25,215,652		2,508	—		—		250,837,451		(1,316,563)		252,156,522
Balance as of March 31, 2021	2,384,348	$	252	6,900,000	$	690	$	—	$	4,999,059	$	5,000,001


	For the three
	months ended
	March 31, 2021
Cash Flows from Operating Activities:
Net income	$	6,319,210
Adjustments to reconcile net loss to net cash used in operating activities:
Interest earned on cash held in Trust Account		(8,319)
Unrealized gain on change in fair value of warrants		(7,166,800)
Transaction costs		655,046
Changes in operating assets and liabilities
Prepaid assets		(696,830)
Franchise tax payable		50,000
Accounts payable and accrued expenses		293,175
Net cash used in operating activities		554,518

Cash flows from investing activities:
Principal invested into Trust account		276,000,000
Net cash used in investing activities		276,000,000

Cash flows from financing activities:
Due to related party		3,817
Proceeds from sale of Units, net of underwriter fee
Offering costs		360,212
Proceeds from issuance of Private Placement Warrants		7,820,000
Borrowing from Promissory Note		360,212
Repayment of promissory note		(73,780)
Proceeds from working capital loans		100,000
Net cash provided by financing activities		277,996,017

Net Change in Cash		1,441,499
Cash, beginning of the period		—
Cash, end of period	$	1,441,499

Supplemental Disclosure of Non-cash Financing Activities:
Initial classification of
Class A ordinary shares subject to possible redemption	$	245,211,820
Change in Class A ordinary shares subject to possible redemption	$	6,944,702
Deferred underwriters’ discount payable charged to additional paid in capital	$	9,660,000
Initial Warrant liability	$	18,028,933

w
	As Previously Reported		Adjustment		As restated
Balance Sheet at February 11, 2021
Warrant liability	$	—	$	18,028,933	$	18,028,933
Total Liabilities		11,007,558		18,028,933		29,036,491
Class A common stock subject to possible redemption,		263,240,750		(18,028,930)		245,211,820
Class A common stock		128		180		308
Additional paid-in capital		5,013,670		652,382		5,666,052
Accumulated deficit		(14,481)		(652,565)		(667,046)
Total Stockholders’ Equity	$	5,000,007	$	(3)	$	5,000,004


	For the three
	months ended
	March 31,
	2021
Common stock subject to possible redemption
Numerator: Net income allocable to Class A common stock subject to possible redemption
Accretion of interest income on marketable securities held in trust	$	8,319
Less: interest available to be withdrawn for payment of taxes		8,319
Net income allocable to Class A common stock subject to possible redemption	$	—
Denominator: Weighted Average Redeemable Class A common stock
Redeemable Class A Common Stock, Basic and Diluted		27,600,000
Basic and Diluted net income per share, Redeemable Class A Common Stock	$	0.00

Class B Non-Redeemable Common Stock
Numerator: Net Income minus Redeemable Net Earnings
Net Income	$	6,319,210
Redeemable Net Earnings		—
Non-Redeemable Net Income	$	6,319,210
Denominator: Weighted Average Class B Non-Redeemable Common Stock
Basic and diluted weighted average shares outstanding, Class B common stock		6,900,000
Basic and diluted net income per share, Class B common stock	$	0.92


	Carrying		Amortization		Gross		Fair Value
	Value/Amortized		of Bond		Unrealized		as of
	Cost		Discount		Gain		March 31, 2021
U.S. Money Market	$	182	$	—	$	—	$	182
U.S. Treasury Bills		—		8,319		—		—
		—		8,319		—		—




	Carrying Value		(Level 1)		(Level 2)		(Level 3)
Assets:
Investments held in Trust Account – U.S. Treasury Bills	$	276,008,319	$	276,027,912	$	—	$	—
Liabilities:
Private Placement Warrants	$	3,962,133		—		—	$	3,962,133
Public Warrants	$	6,900,000		—		—	$	6,900,000


	February 11, 2021
Input	(Initial Measurement)			March 31, 2021
Risk-free interest rate		0.46	%		0.92	%
Expected term (years)		5.0			5.0
Expected volatility		23.0	%		15.0	%
Acquisition probability		80	%		80	%
Exercise price	$	11.50		$	11.50

By:	/s/ Oleg Grodnensky
	Name:	Oleg Grodnensky
	Title:	Chief Financial Officer


Fair value at issuance February 11, 2021	$	18,028,933
Change in fair value		(7,166,800)
Fair Value at March 31, 2021	$	10,862,133

Exhibit Number		Description
31.1*		Certification of Chief Executive Officer (Principal Executive Officer) Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2*		Certification of Chief Financial Officer (Principal Financial and Accounting Officer) Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1**		Certification of Chief Executive Officer (Principal Executive Officer) Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2**		Certification of Chief Financial Officer (Principal Financial and Accounting Officer) Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101.INS		XBRL Instance Document

101.SCH		XBRL Taxonomy Extension Schema Document

101.CAL		XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF		XBRL Taxonomy Extension Definition Linkbase Document

101.LAB		XBRL Taxonomy Extension Label Linkbase Document

101.PRE		XBRL Taxonomy Extension Presentation Linkbase Document

SEC Form 10-Q filed by Priveterra Acquisition Corp.