References in this report (the "Quarterly Report") to "we," "us" or the "Company" refer to Arbor Rapha Capital Bioholdings Corp. The following discussion and analysis of the Company's financial condition and results of operations should be read in conjunction with the financial statements and the notes thereto contained elsewhere in this Quarterly Report. Certain information contained in the discussion and analysis set forth below includes forward-looking statements that involve risks and uncertainties.

Note Regarding Forward-Looking Statements

This quarterly report on Form 10-Q includes forward-looking statements. We have based these forward-looking statements on our current expectations and projections about future events. These forward-looking statements are subject to known and unknown risks, uncertainties and assumptions about us that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by such forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as "may," "should," "could," "would," "expect," "plan," "anticipate," "believe," "estimate," "continue," or the negative of such terms or other similar expressions. Factors that might cause or contribute to such a discrepancy include, but are not limited to, those described in our other Securities and Exchange Commission ("SEC") filings.

Overview

We were formed on March 4, 2021 for the purpose of entering into a merger, share exchange, asset acquisition, stock purchase, recapitalization, reorganization or other similar business combination with one or more target businesses. Our efforts to identify a prospective target business will not be limited to any particular industry or geographic region. We intend to utilize cash derived from the proceeds of our initial public offering in effecting our initial business combination.

We are an emerging growth company and, as such, we are subject to all of the risks associated with emerging growth companies.

We presently have no revenue. All activities for the period from March 4, 2021 (inception) through September 30, 2021, relate to the formation and the Initial Public Offering. We will have no operations other than the active solicitation of a target business with which to complete a business combination, and we will not generate any operating revenue until after its initial business combination, at the earliest. We will have non-operating income in the form of interest income on cash and cash equivalents from the proceeds derived from the Initial Public Offering.

On November 2, 2021, we consummated the Initial Public Offering of 17,250,000 Units. The Units were sold at an offering price of $10.00 per unit, generating total gross proceeds of $172,500,000.

Simultaneous with the consummation of the Initial Public Offering, the Company consummated the private placement of an aggregate of 4,133,333 warrants (the "Private Placement Warrants") at a price of $1.50 per Private Placement Warrant, generating total proceeds of $6,200,000. Each whole Private Placement Warrant is exercisable to purchase one share of common stock at an exercise price of $11.50 per share.

The Private Placement Warrants are identical to the warrants underlying the Units sold in the Initial Public Offering, except that the Private Placement Warrants are not transferable, assignable or salable until after the completion of a Business Combination, subject to certain limited exceptions.

Additionally, the Company executed a promissory note with the Sponsor (the "Sponsor Loan Note"), in the amount of $4,312,500. The Sponsor Loan Note shall be repaid or converted into warrants (the "Sponsor Loan Warrants") at a purchase price of $1.50 per warrant, at the Sponsor's direction, at the completion of a Business Combination. The Sponsor Loan Warrants will be identical to the Private Placement Warrants.



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Of the gross proceeds received from the Initial Public Offering, the exercise of the over-allotment option and a portion of the Private Placement Warrant, an aggregate of $ $176,812,500 was placed in the Trust Account.

Through the date of the IPO transaction costs amounted to $9,985,222 consisting of $3,450,000 of underwriting fees, $6,037,500 of deferred underwriting fees payable (which are held in a trust account with Continental Stock Transfer and Trust Company acting as trustee (the "Trust Account")), and $497,722 of Initial Public Offering costs.

We cannot assure you that our plans to complete our Initial Business Combination will be successful. If we are unable to complete the initial business combination within 15 months from the date of the Initial Public Offering, we will (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than five business days thereafter, redeem 100% of the outstanding public shares and (iii) as promptly as reasonably possible following such redemption, subject to the approval of the remaining holders of ordinary shares and our board of directors, liquidate and dissolve. In the event of liquidation, the holders of the founder shares and Private Warrants will not participate in any redemption distribution with respect to their founder shares or Private Warrants, until all of the claims of any redeeming shareholders and creditors are fully satisfied (and then only from funds held outside the Trust Account).

Results of Operations

We have neither engaged in any operations nor generated any revenues to date. Our only activities through September 30, 2021 were organizational activities, those necessary to prepare for the Public Offering, and, after our Public Offering, day-to-day operations and identifying a target company for an Initial Business Combination. We do not expect to generate any operating revenues until after the completion of our Initial Business Combination. We incur expenses as a result of being a public company (for legal, financial reporting, accounting and auditing compliance), as well as for due diligence expenses.

For the period from March 4, 2021 (inception) through September 30, 2021, we had a net loss of $234, consisting of operating and formation costs.

For the three months ended September 30, 2021, we had no income or loss.

Liquidity and Capital Resources

As of September 30, 2021, we had cash of $250.

For the period from March 4, 2021 (inception) through September 30, 2021, the net increase in cash was $250. For the period from March 4, 2021 (inception) through September 30, 2021, cash provided by operating activities was $0. For the period from March 4, 2021 (inception) through September 30, 2021, cash provided by financing activities was $250 and was primarily the result of proceeds from the issuance of Class B common stock to Sponsor of $25,000, advance from Sponsor of $1,000, less $25,750 of deferred offering costs paid.

In connection with the Initial Public Offering and related transactions described above, net cash received by the Company for general operating purposes was approximately $2.7 million.

Off-Balance Sheet Arrangements

We did not have any off-balance sheet arrangements as of September 30, 2021.

Contractual obligations

Other than the below, as of September 30, 2021, we did not have any long-term debt, capital lease obligations, operating lease obligations or long-term liabilities.



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The underwriters are entitled to a deferred fee of $6,037,500 in the aggregate. The deferred fee will be waived by the underwriters in the event that we do not complete an Initial Business Combination, subject to the terms of the underwriting agreement.

Commencing on the date the Units are first listed on Nasdaq, the Company has agreed to pay the Sponsor a total of $10,000 per month for office space, utilities, support and administrative services for up to 15 months. Upon completion of the Initial Business Combination or the Company's liquidation, the Company will cease paying these monthly fees.

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