The following discussion and analysis should be read in conjunction with the
financial statements and related notes included elsewhere in this Annual Report
on Form
10-K.
This discussion contains forward-looking statements reflecting our current
expectations, estimates and assumptions concerning events and financial trends
that may affect our future operating results or financial position. Actual
results and the timing of events may differ materially from those contained in
these forward-looking statements due to a number of factors, including those
discussed in the sections entitled "Risk Factors" and "Forward-Looking
Statements" appearing elsewhere in this Annual Report on Form
10-K.

Overview

We are a newly organized blank check company incorporated on February 17, 2021 as a Delaware corporation and formed for the purpose of effect a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses (the "Business Combination").



Our sponsor is Spindletop Health Sponsor Group, LLC, a Delaware limited
liability company (the "Sponsor"). The registration statement for our initial
public offering was declared effective on November 3, 2021. On November 8, 2021,
we consummated the IPO of 23,000,000 units (the "Units") including 3,000,000
Units as part of the underwriters' over-allotment option. Each Unit consists of
one share of our Class A common stock, par value $0.0001 per share ("Class A
common stock"), and
one-half
of one of our redeemable warrant ("Public Warrant"), with each whole Public
Warrant entitling the holder thereof to purchase one share of Class A common
stock for $11.50 per share, subject to adjustment. The Units were sold at a
price of $10.00 per Unit, generating gross proceeds to us of $230,000,000.

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Simultaneously with the closing of the IPO, we completed the private sale of an aggregate of 12,600,000 warrants (the "Private Placement Warrants"), including 1,200,000 Private Placement Warrants related to the underwriters' fully exercising their over-allotment option, at a purchase price of $1.00 per Private Placement Warrant, to the Sponsor, generating gross proceeds to us of $12,600,000.


Upon the closing of the IPO, $10.20 per Unit sold in the IPO is held in a "Trust
Account" and may only be invested in U.S. "government securities", within the
meaning of 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 of Rule
2a-7
promulgated under the Investment Company Act, which invest only in direct U.S.
government treasury obligations. Except with respect to interest earned on the
funds held in the Trust Account that may be released to us to pay its tax
obligations, the proceeds from the IPO and the sale of the Private Placement
Warrants will not be released from the Trust Account until the earliest to occur
of: (a) the completion of our initial Business Combination, (b) the redemption
of any shares of our Class A common stock sold in the IPO (the "public shares")
properly submitted in connection with a stockholder vote to amend our amended
and restated certificate of incorporation (i) to modify the substance or timing
of our obligation to provide for the redemption of the public shares in
connection with the initial Business Combination or to redeem 100% of our public
shares if it does not complete its initial Business Combination within 15 months
from the closing of the IPO or (ii) with respect to any other material
provisions relating to stockholders' rights or
pre-initial
Business Combination activity, and (c) the redemption of our public shares if we
are unable to complete the initial Business Combination within 15 months from
the closing of the IPO, subject to applicable law. The proceeds deposited in the
Trust Account could become subject to the claims of our creditors which would
have priority over the claims of our public stockholders.

We will have 15 months from the closing of the IPO to complete an initial
Business Combination (the "Combination Period") (or extended (a) to 18 months if
we have filed (i) a Form
8-K
including a definitive merger or acquisition agreement or (ii) a proxy
statement, registration statement or similar filing for an initial business
combination but have not completed the initial business combination within such
15-month
period or (b) two instances by an additional three months each instance for a
total of up to 18 months or 21 months, respectively, by depositing into the
trust account for each three month extension in an amount of $0.10 per unit).
However, if we are unable to complete its initial Business Combination within
the Combination Period, 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
and not previously released to us to pay its taxes (less 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 board
of directors, liquidate and dissolve, subject in each case to our obligations
under Delaware law to provide for claims of creditors and the requirements of
other applicable law.

RESULTS OF OPERATIONS

As of December 31, 2021, we had not commenced any operations. All activity for the period from February 17, 2021 (inception) through December 31, 2021, relates to our formation and the Initial Public Offering and since the closing of the IPO, the search for a prospective initial Business Combination. We have neither engaged in any operations nor generated any revenues to date. We will not generate any operating revenues until after the completion of our initial Business Combination, at the earliest. We will generate non-operating income in the form of interest income on cash and cash equivalents from the proceeds derived from the Initial Public Offering. We expect to 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 period from February 17, 2021 (inception) to December 31, 2021, we had net income of $6,635,716, which consisted of a change in the fair value of warrant liabilities of $7,750,219, and earnings from investments held in trust account of $3,651 partially offset by formation and operating costs of $537,517 and offering costs allocated to warrants of $580,637.


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Liquidity, Capital Resources and Going Concern

As of December 31, 2021, we had $1,195,715 in our operating bank account, and working capital of $2,015,288.

Our liquidity needs up to December 31, 2021 had been satisfied through a payment from the Sponsor of $24,425 for the founder shares to cover certain offering costs and the loan under two unsecured promissory notes from the Sponsor of $300,000. The promissory note was paid in full on November 8, 2021. In addition, in order to finance transaction costs in connection with a Business Combination, the Sponsor, initial stockholders, officers, directors or their affiliates may, but are not obligated to, provide us Working Capital Loan. As of December 31, 2021, there were no amounts outstanding under any Working Capital Loans.

On November 8, 2021, we consummated the IPO of 23,000,000 units (the "Units") including 3,000,000 Units as part of the underwriters' over-allotment option. The Units were sold at a price of $10.00 per Unit, generating gross proceeds of $230,000,000. Simultaneously with the closing of the IPO we completed the private sale of 12,600,000 Private Placement Warrants, including 1,200,000 Private Placement Warrants related to the underwriters' fully exercising their over-allotment option, at a purchase price of $1.00 per Private Placement Warrant to the Sponsor, generating gross proceeds of $12,600,000.

Based on the foregoing, we believe that we will have sufficient working capital and borrowing capacity to meet our needs through the earlier of the consummation of a Business Combination or one year from this filing. Over this time period, we will be using these funds for paying existing accounts payable, identifying and evaluating prospective initial Business Combination candidates, performing due diligence on prospective target businesses, paying for travel expenditures, selecting the target business to merge with or acquire, and structuring, negotiating and consummating the Business Combination.

In connection with the Company's assessment of going concern considerations in accordance with Financial Accounting Standard Board's Accounting Standards Update ("ASU") 2014-15, "Disclosures of Uncertainties about an Entity's Ability to Continue as a Going Concern," management has determined that the mandatory liquidation and subsequent dissolution, should the Company be unable to complete a Business Combination, raises substantial doubt about the Company's ability to continue as a going concern. The Company has until February 8, 2023 (or up to August 8, 2023 if extended as described above) to consummate a Business Combination. Our amended and restated certificate of incorporation provides that we must complete our initial business combination within 15 months from the closing of our Initial Public Offering (or extended (a) to 18 months if we have filed (i) a Form 8-K including a definitive merger or acquisition agreement or (ii) a proxy statement, registration statement or similar filing for an initial business combination but have not completed the initial business combination within such 15-month period or (b) two instances by an additional three months each instance for a total of up to 18 months or 21 months, respectively, by depositing into the trust account for each three month extension in an amount of $0.10 per unit). It is uncertain that the Company will be able to consummate a Business Combination by this time or if the Company has the financial resources to extend the mandatory liquidation date beyond February 8, 2023 by depositing into the trust account for each three month extension an amount of $0.10 per unit. If a Business Combination is not consummated or the mandatory liquidation date is not extended by February 8, 2023, there will be a mandatory liquidation and subsequent dissolution. No adjustments have been made to the carrying amounts of assets or liabilities should the Company be required to liquidate after February 8, 2023.

Contractual Obligations

Other than the administrative services agreement and deferred underwriting commission, we do not have any long-term debt obligations, capital lease obligations, operating lease obligations, purchase obligations or long-term liabilities.

Administrative Services Agreement

Commencing on the date that our securities are first listed on Nasdaq, we agreed to pay the Sponsor $20,000 per month for office space, utilities and secretarial and administrative support services. Upon completion of the initial Business Combination or our liquidation, we will cease paying these monthly fees. At December 31, 2021, $40,000 had been accrued and charged to operating expenses, $20,000 of which is outstanding.

Registration Rights

The holders of the founder shares, Private Placement Warrants, and warrants that may be issued upon conversion of Working Capital Loans will have registration rights to require us to register a sale of any of its securities held by them pursuant to a registration rights agreement to be signed prior to or on the effective date of the IPO. These holders will be entitled to make up to three demands, excluding short form registration demands, that we register such securities for sale under the Securities Act. In addition, these holders will have "piggy-back" registration rights to include their securities in other registration statements filed by us.

Underwriter Agreement



We granted the underwriters a
45-day
option to purchase up to 3,000,000 additional Units to cover any over-allotments
at the IPO price less the underwriting discounts and commissions. At the time of
the IPO, the underwriters fully exercised their over-allotment option.

On November 8, 2021, we paid a cash underwriting commission of $0.20 per unit, or $4,600,000, (including the commission related to the underwriters' exercise of the over-allotment option).


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The underwriters are entitled to deferred underwriting commissions of $0.35 per unit, or $8,050,000 in the aggregate (including the commission related to the underwriters' exercise of the over-allotment option). The deferred fee will become payable to the underwriters from the amounts held in the Trust Account solely in the event that we complete an Initial Business Combination, subject to the terms of the underwriting agreement for the offering.

Critical Accounting Policies and Estimates

The preparation of the financial statement in conformity with US GAAP requires the Company's management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statement and the reported amounts of expenses during the reporting period. Actual results could differ from those estimates.

Warrant Liability

The Company accounts for the 24,100,000 warrants issued in connection with the IPO and Private Placement in accordance with the guidance contained in FASB ASC 815 "Derivatives and Hedging" whereby under that provision the warrants do not meet the criteria for equity treatment and must be recorded as a liability. Accordingly, the Company classifies the warrant instruments as a liability at fair value and adjusts the instruments to fair value at each reporting period. This liability will be re-measured at each balance sheet date until the warrants are exercised or expire, and any change in fair value will be recognized in the Company's statement of operations. The fair value of warrants will be estimated using an internal valuation model. The valuation model will utilize inputs such as assumed share prices, volatility, discount factors and other assumptions and may not be reflective of the price at which they can be settled. Such warrant classification is also subject to re-evaluation at each reporting period.

Deferred Offering Costs



We comply with the requirements of the ASC
340-10-S99-1
and SEC Staff Accounting Bulletin ("SAB") Topic 5A-"Expenses of Offering".
Deferred offering costs consist principally of professional and registration
fees incurred through the balance sheet date that are directly related to the
Public Offering. Offering costs are charged to temporary equity or the statement
of operations based on the relative value of the Warrants to the proceeds
received from the Units sold upon the completion of the IPO. Accordingly, on
November 8, 2021, offering costs totaling $13,423,194 (consisting of $4,600,000
of underwriting fees, $8,050,000 of deferred underwriting fees and $773,194 of
other offering costs) were recognized with $580,637 which were allocated to the
Public and Private Warrants, included in accumulated deficit and $12,842,557
included in temporary equity.

Class A Common Stock Subject to Possible Redemption

We account for our Class A common stock subject to possible redemption in accordance with the guidance in Accounting Standards Codification ("ASC") Topic 480 "Distinguishing Liabilities from Equity." Class A common stock subject to mandatory redemption is classified as a liability instrument and is measured at fair value. Conditionally redeemable common stock (including common stock that features redemption rights that are either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within our control) is classified in temporary equity. At all other times, common stock is classified as stockholders' equity. Our Class A common stock feature certain redemption rights that are considered to be outside of our control and subject to occurrence of uncertain future events. Accordingly, at December 31, 2021, the 23,000,000 shares of Class A common stock is presented at redemption value as temporary equity, outside of the stockholders' deficit section of our balance sheet.

Net Income Per Common Stock

We comply with accounting and disclosure requirements of FASB ASC Topic 260, "Earnings Per Share". Net income (loss) per common stock is computed by dividing net income (loss) by the weighted average number of common stock outstanding for the period. Remeasurement adjustments associated with the redeemable shares of common stock is excluded from earnings per share as the redemption value approximates fair value.

We have two classes of shares, which are referred to as Class A common stock and Class B common stock. Earnings and losses are shared pro rata between the two classes of shares. We have not considered the effect of the warrants sold in the Initial Public Offering and the Private Placement to purchase an aggregate of 21,400,000 of our Class A common stock in the calculation of diluted loss per share, since their exercise is contingent upon future events. As a result, diluted net income per common stock is the same as basic net income per common stock.


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The Company's management does not believe that any other recently issued, but not yet effective, accounting pronouncements, if currently adopted, would have a material effect on the Company's financial statements.

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