References to the "Company," "Ahren Acquisition Corp.," "our," "us" or "we" refer to Ahren Acquisition 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 Annual Report. Certain information contained in the discussion and analysis set forth below includes forward-looking statements that involve risks and uncertainties.





Forward Looking Statements

All statements other than statements of historical fact included in this Annual Report including, without limitation, statements under "Management's Discussion and Analysis of Financial Condition and Results of Operations" regarding the Company's financial position, business strategy and the plans and objectives of management for future operations, are forward-looking statements. When used in this Annual Report, words such as "anticipate," "believe," "estimate," "expect," "intend" and similar expressions, as they relate to us or the Company's management, identify forward-looking statements. Such forward-looking statements are based on the beliefs of management, as well as assumptions made by, and information currently available to, the Company's management. Actual results could differ materially from those contemplated by the forward-looking statements as a result of certain factors detailed in our filings with the SEC.

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the financial statements and the notes thereto contained elsewhere in this Annual Report. Certain information contained in the discussion and analysis set forth below includes forward-looking statements that involve risks and uncertainties.





Overview

We are a blank check company incorporated on April 1, 2021 as a Cayman Islands exempted company for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses. While we may pursue an Initial Business Combination opportunity in any geography, we seek to identify differentiated opportunities. In Europe and the UK, where deep technology and deep science are very strong, enterprise valuations are in many cases currently attractive relative to other global locations. We intend to effectuate our Initial Business Combination using cash from the proceeds of our Initial Public Offering and the Private Placement of the Private Placement Warrants, the proceeds of the sale of our shares in connection with our Initial Business Combination (pursuant to forward purchase agreements or backstop agreements we may enter into or otherwise), shares issued to the owners of the target, debt issued to bank or other lenders or the owners of the target, other securities issuances, or a combination of the foregoing.

The issuance of additional shares in connection with an Initial Business Combination to the owners of the target or other investors:





    ?   may significantly dilute the equity interest of existing investors, which
        dilution would increase if the anti-dilution provisions of the Founder
        Shares resulted in the issuance of Class A Ordinary Shares on a greater
        than one-to-one basis upon conversion of the Founder Shares;




    ?   may subordinate the rights of holders of Class A Ordinary Shares if
        preference shares are issued with rights senior to those afforded our
        Class A Ordinary Shares;




    ?   could cause a change in control if a substantial number of our Class A
        Ordinary Shares are issued, which may affect, among other things, our
        ability to use our net operating loss carry forwards, if any, and could
        result in the resignation or removal of our present officers and
        directors;




    ?   may have the effect of delaying or preventing a change of control of us by
        diluting the share ownership or voting rights of a person seeking to
        obtain control of us; and




    ?   may adversely affect prevailing market prices for our Class A Ordinary
        Shares and/or Warrants.




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Similarly, if we issue debt securities or otherwise incur significant debt to bank or other lenders or the owners of a target, it could result in:





    ?   default and foreclosure on our assets if our operating revenues after an
        Initial Business Combination are insufficient to repay our debt
        obligations;




    ?   acceleration of our obligations to repay the indebtedness even if we make
        all principal and interest payments when due if we breach certain
        covenants that require the maintenance of certain financial ratios or
        reserves without a waiver or renegotiation of that covenant;




    ?   our immediate payment of all principal and accrued interest, if any, if
        the debt is payable on demand;




    ?   our inability to obtain necessary additional financing if the debt
        contains covenants restricting our ability to obtain such financing while
        the debt is outstanding;




  ? our inability to pay dividends on our Class A Ordinary Shares;




    ?   using a substantial portion of our cash flow to pay principal and interest
        on our debt, which will reduce the funds available for dividends on our
        Class A Ordinary Shares if declared, expenses, capital expenditures,
        acquisitions and other general corporate purposes;




    ?   limitations on our flexibility in planning for and reacting to changes in
        our business and in the industry in which we operate;




    ?   increased vulnerability to adverse changes in general economic, industry
        and competitive conditions and adverse changes in government regulation;
        and




    ?   limitations on our ability to borrow additional amounts for expenses,
        capital expenditures, acquisitions, debt service requirements, execution
        of our strategy and other purposes and other disadvantages compared to our
        competitors who have less debt.

We expect to incur significant costs in the pursuit of our Initial Business Combination. We cannot assure you that our plans to raise capital or to complete our Initial Business Combination will be successful.

Results of Operations and Known Trends or Future Events

We have neither engaged in any operations nor generated any revenues to date. Our only activities since inception have been organizational activities, those necessary to prepare for and consummate the Initial Public Offering, and since the completion of the Initial Public Offering, searching for an Initial Business Combination. We will not generate any operating revenues until after completion of our Initial Business Combination. We have generated non-operating income in the form of interest income on cash and cash equivalents after the Initial Public Offering. There has been no significant change in our financial or trading position and no material adverse change has occurred since the date of our audited financial statements. We incur increased 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 year ended December 31, 2021, we had a net loss of $2,666,754, which consists of formation and operating costs of $103,785, stock-based compensation expense of $658,770, transaction costs allocated to derivative warrant liability of $485,483, and change in fair value of derivative warrant liabilities of $1,418,716.

Liquidity and Capital Resources

Prior to the consummation of our Initial Public Offering, our liquidity needs were met through $25,000 paid by the Sponsor to cover certain of our offering and formation costs in exchange for the issuance of the Founder Shares to our Sponsor and $285,316 in loans from our Sponsor, which amount was repaid in full on December 21, 2021.

The net proceeds of $305,997,960 ($10.20 per Unit) from the Initial Public Offering and the sale of the Private Placement Warrants, comprised of $293,998,040 of the proceeds from the Initial Public Offering (which includes $10,499,930 of the underwriter's deferred fees) and $11,999,920 of the proceeds of the sale of Private Placement Warrants, was placed in the Trust Account and are invested or bear interest since December 20, 2021. The proceeds are invested only in U.S. government securities, within the meaning set forth in Section 2(a)(16) of the Investment Company Act, having a maturity of 185 days or less or in money market funds meeting certain conditions under Rule 2a-7 promulgated under the Investment Company Act which invest only in direct U.S. government treasury obligations.





                                       49

We intend to use substantially all of the funds held in the Trust Account, including any amounts representing interest earned on the Trust Account (excluding deferred underwriting commissions) to complete an Initial Business Combination. We may withdraw interest to pay our taxes, if any. Our annual income tax obligations will depend on the amount of interest and other income earned on the amounts held in the Trust Account. We expect the interest earned on the amount in the Trust Account will be sufficient to pay our income taxes. To the extent that our equity or debt is used, in whole or in part, as consideration to complete our Initial Business Combination, the remaining proceeds held in the Trust Account will be used as working capital to finance the operations of the target business or businesses, make other acquisitions and pursue our growth strategies.

As of December 31, 2021, we had available to us $2,156,137 of cash proceeds held outside the Trust Account. We will use these funds primarily to identify and evaluate target businesses, perform business due diligence on prospective target businesses, travel to and from the offices, plants or similar locations of prospective target businesses or their representatives or owners, review corporate documents and material agreements of prospective target businesses, and structure, negotiate and complete an Initial Business Combination.

We do not believe we will need to raise additional funds following the Initial Public Offering in order to meet the expenditures required for operating our business prior to our Initial Business Combination. However, if our estimates of the costs of identifying a target business, undertaking in-depth due diligence and negotiating an Initial Business Combination are less than the actual amount necessary to do so, we may have insufficient funds available to operate our business prior to our Initial Business Combination. In order to fund working capital deficiencies or finance transaction costs in connection with an intended Initial Business Combination, our Sponsor or an affiliate of our Sponsor or certain of our officers and directors may, but are not obligated to, loan us funds as may be required. If we complete our Initial Business Combination, we would repay such loaned amounts. In the event that our Initial Business Combination does not close, we may use a portion of the working capital held outside the Trust Account to repay such loaned amounts but no proceeds from our Trust Account would be used for such repayment. Up to $2,000,000 of such loans may be convertible into additional Private Placement Warrants of the post-Initial Business Combination entity at a price of $1.00 per warrant at the option of the lender. The terms of such loans, if any, have not been determined and no written agreements exist with respect to such loans. Prior to the completion of our Initial Business Combination, we do not expect to seek loans from parties other than our Sponsor or an affiliate of our Sponsor as we do not believe third parties will be willing to loan such funds and provide a waiver against any and all rights to seek access to funds in our Trust Account.

These amounts are estimates and may differ materially from our actual expenses. In addition, we could use a portion of the funds not held in trust to pay commitment fees for financing, fees to consultants to assist us with our search for a target business or as a down payment or to fund a "no-shop" provision (a provision designed to keep target businesses from "shopping" around for transactions with other companies or investors on terms more favorable to such target businesses) with respect to a particular proposed Initial Business Combination, although we do not have any current intention to do so. If we entered into an agreement where we paid for the right to receive exclusivity from a target business, the amount that would be used as a down payment or to fund a "no-shop" provision would be determined based on the terms of the specific Initial Business Combination and the amount of our available funds at the time. Our forfeiture of such funds (whether as a result of our breach or otherwise) could result in our not having sufficient funds to continue searching for, or conducting due diligence with respect to, prospective target businesses.





                                       50

Moreover, we may need to obtain additional financing to complete our Initial Business Combination, either because the transaction requires more cash than is available from the proceeds held in our Trust Account or because we become obligated to redeem a significant number of our Public Shares upon completion of the Initial Business Combination, in which case we may issue additional securities or incur debt in connection with such Initial Business Combination. In addition, we target businesses with enterprise values that are greater than we could acquire with the net proceeds of our Initial Public Offering and the sale of the Private Placement Warrants, and, as a result, if the cash portion of the purchase price exceeds the amount available from the Trust Account, net of amounts needed to satisfy any redemptions by Public Shareholders, we may be required to seek additional financing to complete such proposed Initial Business Combination. We may also obtain financing prior to the closing of our Initial Business Combination to fund our working capital needs and transaction costs in connection with our search for and completion of our Initial Business Combination. There is no limitation on our ability to raise funds through the issuance of equity or equity-linked securities or through loans, advances or other indebtedness in connection with our Initial Business Combination, including pursuant to forward purchase agreements or backstop agreements we may enter into. Subject to compliance with applicable securities laws, we would only complete such financing simultaneously with the completion of our Initial Business Combination. If we are unable to complete our Initial Business Combination because we do not have sufficient funds available to us, we will be forced to cease operations and liquidate the Trust Account. In addition, following our Initial Business Combination, if cash on hand is insufficient, we may need to obtain additional financing in order to meet our obligations.





Registration Rights

The holders of Founder Shares, Private Placement Warrants, Class A Ordinary Shares underlying the Private Placement Parrants and Private Placement Warrants that may be issued upon conversion of Working Capital Loans (and any shares of Class A Ordinary Shares issuable upon the exercise of the Private Placement Warrants that may be issued upon conversion of Working Capital Loans) are entitled to registration rights pursuant to a registration rights agreement. The holders of these securities are entitled to make up to three demands, excluding short form demands, that we register such securities. These holders will be entitled to certain demand and "piggyback" registration rights. We will bear the expenses incurred in connection with the filing of any such registration statements.





Underwriting Agreement

We granted the underwriter a 45-day option from the final prospectus relating to the Initial Public Offering to purchase up to 3,750,000 additional Units to cover over-allotments, if any, at the Initial Public Offering price less the underwriting discounts and commissions. On December 17, 2021, the underwriter partially exercised its over-allotment option.

As of December 31, 2021, we did not have any off-balance sheet arrangements as defined in Item 303(a)(4)(ii) of Regulation S-K and did not have any commitments or contractual obligations.

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