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Item 2. Management’s Discussion and Analysis

2023-08-14 compared with 2023-05-22 · 131 added, 117 removed, 34 unchanged (88% of the section changed)

Management’s Discussion and Analysis of Financial Condition and Results of Operations

Management’s Discussion and Analysis of Financial

Condition and Results of Operations

References in this report (the “Quarterly Report”) to “we,” “us” or the “Company” refer to by Bellevue Life Sciences Acquisition Corp.

References to our “management” or our “management team” refer to our officers and directors, and references to the “Sponsor” refer to Bellevue Global Life Sciences Investors LLC, a Delaware limited liability company.

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.

References to our

“management” or our “management team” refer to our officers and directors, and references to the “Sponsor” refer to Bellevue Global Life Sciences Investors LLC, a Delaware limited liability company.

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.

Special Note Regarding Forward-Looking Statements

This Quarterly Report on Form 10-Q includes “forward-looking statements” within the meaning of Section 27A of the

Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Exchange Act of 1934, as amended (the “Exchange Act”).

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 filings made

with the U.S.

This Quarterly Report on Form 10-Q includes “forward-looking statements” within the meaning of Section

27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Exchange Act of 1934, as amended (the “Exchange Act”).

We have based these forward-looking statements on our current expectations and projections about

future events.

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 filings

made with the U.S.

Securities and Exchange Commission (“SEC”).

We are a blank check company incorporated as a Delaware corporation and formed for the purpose of effecting a merger, share exchange,

asset acquisition, stock purchase, recapitalization, reorganization or similar business combination with one or more businesses or entities.

We intend to effectuate our initial business combination using cash from the proceeds of our initial public

offering and the private placement of the placement units, the proceeds of the sale of our capital stock in connection with our initial business combination, shares issued to the owners of the target, debt issued to banks or other lenders or the

owners of the target, or a combination of the foregoing.

We are a blank check company incorporated as a Delaware corporation and formed for the purpose of effecting a merger, share exchange, asset acquisition, stock

purchase, recapitalization, reorganization or similar business combination with one or more businesses or entities.

We intend to effectuate our initial business combination using cash from the proceeds of our initial public offering and the private

placement units, the proceeds of the sale of our capital stock in connection with our initial business combination, shares issued to the owners of the target, debt issued to banks or other lenders or the owners of the target, or a combination of the

The issuance of additional shares in connection with an initial business combination:

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may subordinate the rights of holders of our common stock if preferred stock is issued with rights senior to those afforded our common stock;

could cause a change in control if a substantial number of shares of our common stock is 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 stock ownership or voting rights of a person seeking to

obtain control of us;

could cause a change in control if a substantial number of shares of our common stock is 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 stock ownership or voting rights of a person seeking to obtain control of us;

may adversely affect prevailing market prices for our common stock, warrants and/or rights.

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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;

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 security is payable on demand;

our inability to obtain necessary additional financing if the debt security contains covenants restricting our ability to obtain such financing while

the debt security is outstanding;

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

our inability to pay dividends on our common stock;

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

common stock if declared, our ability to pay expenses, make capital expenditures and acquisitions, and fund other general corporate purposes;

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 common stock if declared, our ability to

pay expenses, make capital expenditures and acquisitions, and fund 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;

limitations on our ability to borrow additional amounts for expenses, capital expenditures, acquisitions, debt service requirements, and execution of

our strategy;

limitations on our ability to borrow additional amounts for expenses, capital expenditures, acquisitions, debt service requirements, and execution of our strategy;

other purposes and other disadvantages compared to our competitors who have less debt.

Recent Developments

Letter of Intent

On July 11, 2023, the Company and OSR Holdings, Ltd.

(“OSR Holdings”) issued a

joint press release announcing that the Company and OSR Holdings have entered into an exclusive, non-binding letter of intent (the “Letter of Intent”) for a business combination.

OSR Holdings is a global healthcare holding company.

terms of the Letter of Intent, the Company and OSR Holdings intend to enter into a definitive agreement pursuant to which the Company and OSR Holdings would combine, with the former equity holders of both entities holding equity in the combined

public company listed on Nasdaq.

Results of Operations

Our entire activity since inception through March 31, 2023 related to our formation and initial public offering.

We do not expect to

generate any operating revenues until after the completion of an initial business combination.

Our entire activity since inception through June 30, 2023 related to our formation and initial public

We do not expect to generate any operating revenues until after the completion of an initial business combination.

We generated non-operating income in the form of interest income on investments held after our initial public offering.

We will 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 in connection with searching for, and completing, an initial business combination.

For the three months ended March 31, 2023, we had net income of $110,305, which consisted of income from investments held

in the Trust Account of $417,728, offset by general and administrative expenses of $278,102 and provision for income taxes of $29,321.

For the three months ended March 31, 2022, we had a net loss of $126 which consisted of general and

administrative expenses.

will 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 in connection with searching for, and completing, an initial business

For the three months ended June 30, 2023, we had net income of $ 301,464 , which

consisted of income from investments held in the Trust Account of $ 810,302, offset by general and administrative expenses of $ 280,273 and provision for income taxes of $ 228,565 .

For the three months ended June 30, 2022, we had a net loss of $988 which

consisted of general and administrative expenses.

For the six months ended June 30, 2023, we had net income of $ 411,769 , which

consisted of income from investments held in the Trust Account of $ 1,228,030, offset by general and administrative expenses of $558,375 and provision for income taxes of

For the six months ended June 30, 2022, we had a net loss of $1,114 which consisted of general and administrative expenses.

Liquidity, Capital Resources and Going Concern Consideration

Our liquidity needs had been satisfied prior to the completion of our initial public offering through a capital contribution from

our Sponsor of $25,000 for the founder shares and an aggregate of $1,200,000 in loans from our Sponsor under unsecured promissory notes.

Upon the closing of our initial public offering, the promissory notes were be deemed to be repaid and settled

in connection with the private placement.

Further, we have incurred and expect to continue to incur significant costs in pursuit of our financing and acquisition plans.

The net proceeds from (i) the sale of the units in our initial public offering (including the units sold in the exercise of the over-allotment

option), after deducting offering expenses of approximately $1,310,000, underwriting commissions of $1,380,000 and excluding deferred underwriting commissions of $2,070,000, and (ii) the sale of the private placement units for an aggregate purchase

price of $4,300,000 was $70,610,000.

Our liquidity needs had been satisfied prior to the completion of our initial public offering through a capital contribution from our Sponsor of

$25,000 for the founder shares and an aggregate of $1,200,000 in loans from our Sponsor under unsecured promissory notes.

Upon the closing of our initial public offering, the promissory notes were

deemed to be repaid and settled in connection with the private placement.

Further, we have incurred and expect to continue to incur significant costs in

pursuit of our financing and acquisition plans.

The net proceeds from (i) the sale of the units in our initial public offering (including the units sold in the exercise of

the over-allotment option), after deducting offering expenses of approximately $1,310,000, underwriting commissions of $1,380,000 and excluding deferred underwriting commissions of $2,070,000, and (ii) the sale of the private placement units for an

aggregate purchase price of $4,300,000 was $70,610,000.

Of this amount, $70,207,500 was placed in the trust account, including $2,070,000 of deferred underwriting commissions.

The proceeds held in the trust account are invested only in U.S.

government treasury obligations with a maturity of 185 days or less or in money market funds meeting certain conditions under Rule 2a-7 under the Investment Company Act of 1940, as amended, which invest only in direct U.S.

government treasury

obligations with a maturity of 185 days or less or in money market funds meeting certain conditions under Rule 2a-7 under the Investment Company Act of 1940, as amended, which invest only in direct U.S.

government treasury obligations.

We intend to use substantially all of the funds held in the trust account, including any amounts representing interest earned on the trust

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We may withdraw interest to pay taxes.

We estimate our annual franchise tax obligations, based on the number of authorized shares of our common stock, to

be $200,000, which is the maximum amount of annual franchise taxes payable by us as a Delaware corporation per annum, which we may pay from funds from our initial public offering held outside of the trust account or from interest earned on the funds

held in our trust account and released to us for this purpose.

We estimate our annual franchise tax obligations, based on the number of authorized shares of our common stock,

to be $200,000, which is the maximum amount of annual franchise taxes payable by us as a Delaware corporation per annum, which we may pay from funds from our initial public offering held outside of the trust account or from interest earned on the

funds held in our trust account and released to us for this purpose.

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 capital stock 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 March 31, 2023, the Company had $348,802 in its operating bank account and working capital of $26,443.

The Company’s liquidity needs prior

to the consummation of the initial public offering had been satisfied through proceeds from advances from related party and from the issuance of common stock.

Subsequent to the consummation of the initial public offering, the Company’s liquidity was

satisfied through the net proceeds from the consummation of the initial public offering and the proceeds from the private placement held outside of the trust account.

In order to fund working capital deficiencies or finance transaction costs in connection with an initial business combination, our Sponsor,

officers and directors or their affiliates may, but are not obligated to, loan us funds as may be required.

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 capital stock 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.

On June 23, 2023, the Company issued an unsecured promissory note (the “Note”) in the principal amount

of $200,000 to the Sponsor to fund working capital requirements.

The Note is not interest bearing and is payable in full on the earlier of:

(i) December 31, 2024 or (ii) the date on which the Company consummates an initial business combination (the

“Business Combination”).

In the event that the Company does not consummate a business combination, the Note will be repaid only from amounts remaining outside of the Company’s trust account, if any.

At the Sponsor’s discretion, the principal

balance of the Note may be converted at any time prior to the consummation of an initial business combination into units identical to the private placement units at a price of $10.00 per Unit.

As of June 30, 2023, there was no outstanding balance

On July 5, 2023, the Company received the full amount of $200,000 of the Note signed on June 23, 2023.

As of June 30, 2023, the Company had $1,181 in its operating bank account and working capital deficit of $482,395.

Company's liquidity needs prior to the consummation of the initial public offering had been satisfied through proceeds from advances from related party and from the issuance of common stock.

Subsequent to the consummation of the initial public

offering, the Company's liquidity was satisfied through the net proceeds from the consummation of the initial public offering and the proceeds from the private placement held outside of the trust account.

In order to fund working capital requirements or finance transaction costs in connection with an initial business

combination, our Sponsor, officers and directors or their affiliates may, but are not obligated to, loan us funds.

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 $1,000,000 of such loans may be convertible into units,

at a price of $10.00 per unit at the option of the lender, upon consummation of our initial business combination.

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 $1,000,000 of such loans may be

convertible into units, at a price of $10.00 per unit at the option of the lender, upon consummation of our initial business combination.

The units would be identical to the private placement units.

The terms of such loans by our Sponsor, officers and directors or their

affiliates, if any, have not been determined and no written agreements exist with respect to such loans.

We do not expect to seek loans from parties other than our Sponsor, officers and directors or their affiliates 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.

Loans made by Chardan Capital Markets, LLC, the representative of the underwriters in connection with our initial public

offering (“Chardan”), or any of its related persons, if any, will not be convertible into any of our securities and Chardan and its related persons will have no recourse with respect to their ability to convert their loans into any of our securities.

Based on the foregoing and the limited amount of working capital that the Company received into the operating account from the private

placement, management believes that the Company will not have sufficient working capital to meet its working capital needs through the earlier of the consummation of an initial business combination or nine months from the initial public offering.

We do not expect to seek loans from parties other

than our Sponsor, officers and directors or their affiliates 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.

Loans made by Chardan

Capital Markets, LLC, the representative of the underwriters in connection with our initial public offering (“Chardan”), or any of its related persons, if any, will not be convertible into any of our securities and Chardan and its related persons

will have no recourse with respect to their ability to convert their loans into any of our securities.

Based on the foregoing and the limited amount of working capital that the Company received into the operating account from

the private placement, management believes that the Company will not have sufficient

working capital to meet its working capital needs through the earlier of the consummation of an initial business combination or nine months

from the initial public offering.

These conditions raise substantial doubt about the Company's ability to continue as a going concern.

Over this time period, the Company will be using the remaining funds held outside of the trust account 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 initial business combination.

Over this time period, the Company will be using the remaining funds held outside of the trust account 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 initial business combination.

Further needs for operating capital beyond the Company's current operating cash balance may need to be funded through loans from the Company's Sponsor.

The financial statements do not

include any adjustments that might result from the outcome of this uncertainty.

If the Company is unable to complete a business combination by November 14, 2023 (subject to extension by majority approval by the

Company’s stockholders voting), the Company will cease all operations except for the purpose of liquidating.

This date for mandatory liquidation and subsequent dissolution combined with uncertainty as to whether the Company has sufficient liquidity

to fund operations through the liquidation date or thereafter should a deferral occur raises substantial doubt about the Company’s ability to continue as a going concern.

Management plans to evaluate potential

business combination opportunities and intends to complete a business combination.

financial statements do not include any adjustments that might result from the outcome of this uncertainty.

If the Company is unable to complete a business combination by November 14, 2023 (subject to extension by majority approval by the Company’s

stockholders voting), the Company will cease all operations except for the purpose of liquidating.

This date for mandatory liquidation and subsequent dissolution combined with uncertainty as to whether the Company has sufficient liquidity to fund

operations through the liquidation date or thereafter should a deferral occur raises substantial doubt about the Company’s ability to continue as a going concern.

Management plans to evaluate potential business combination opportunities and intends

to complete a business combination.

Off-Balance Sheet Arrangements

We have no obligations, assets or liabilities which would be considered off-balance sheet arrangements as of March 31, 2023.

participate in transactions that create relationships with unconsolidated entities or financial partnerships, often referred to as variable interest entities, which would have been established for the purpose of facilitating off-balance sheet

arrangements.

We have not entered into any off-balance sheet financing arrangements, established any special purpose entities, guaranteed any debt or commitments of other entities, or purchased any non-financial assets.

We have no obligations, assets or liabilities which would be considered off-balance sheet arrangements as of June 30, 2023.

We do not participate in

transactions that create relationships with unconsolidated entities or financial partnerships, often referred to as variable interest entities, which would have been established for the purpose of facilitating off-balance sheet arrangements.

not entered into any off-balance sheet financing arrangements, established any special purpose entities, guaranteed any debt or commitments of other entities, or purchased any non-financial assets.

Contractual Obligations

We do not have any long-term debt, capital lease obligations, operating lease obligations, purchase obligations or long-term liabilities, other

than an agreement to pay an affiliate of our Sponsor a monthly fee of $7,500, for office space, utilities and secretarial and administrative support.

We began incurring these fees on March 1, 2023 and will continue to incur these fees monthly until

the earlier of the completion of our initial business combination or our liquidation.

We do not have any long-term debt, capital lease obligations, operating lease obligations, purchase

obligations or long-term liabilities, other than an agreement to pay an affiliate of our Sponsor a monthly fee of $7,500, for office space, utilities and secretarial and administrative support.

We began incurring these fees on March 1, 2023 and

will continue to incur these fees monthly until the earlier of the completion of our initial business combination or our liquidation.

Chardan is entitled to a deferred underwriting commission of $2,070,000.

The deferred fee will be waived by Chardan in the event that we do not

complete an initial business combination, subject to the terms of the underwriting agreement.

Also, we have incurred legal fees related to our initial public offering of $100,000.

These fees will only become due and payable upon the consummation of a

business combination.

The holders of the founder shares, equity participation shares, placement units, and units that may be issued upon conversion of working capital

loans (and in each case holders of their component securities, as applicable) are entitled to registration rights pursuant to the registration rights agreement.

These holders are entitled to make up to two demands, excluding short form registration

demands, that we register such securities for sale under the Securities Act.

In addition, these holders will have “piggyback” registration rights to include their securities in other registration statements filed by us.

We will bear the expenses

incurred in connection with the filing of any such registration statements.

Chardan may not exercise its demand and “piggyback” registration rights after five and seven years, respectively, after the date of our prospectus issued in connection with

our initial public offering and may not exercise its demand rights on more than one occasion.

The deferred fee will be

waived by Chardan in the event that we do not complete an initial business combination, subject to the terms of the underwriting agreement.

Also, we have incurred deferred legal fees payable upon consummation of our initial business combination of

These fees will only become due and payable upon the consummation of a business combination.

The holders of the founder shares, equity participation shares, private placement units, and units that

may be issued upon conversion of working capital loans (and in each case holders of their component securities, as applicable) are entitled to registration rights pursuant to the registration rights agreement.

These holders are entitled to make up

to two demands, excluding short form registration demands, that we register such securities for sale under the Securities Act.

In addition, these holders will have “piggyback” registration rights to include their securities in other registration

statements filed by us.

We will bear the expenses incurred in connection with the filing of any such registration statements.

Chardan may not exercise its demand and “piggyback” registration rights after five and seven years, respectively, after

the date of our prospectus issued in connection with our initial public offering and may not exercise its demand rights on more than one occasion.

Critical Accounting Estimates

The preparation of financial statements and related disclosures in conformity with accounting principles generally accepted in the United States

of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and income and expenses during the

periods reported.

The preparation of financial statements and related disclosures in conformity with accounting principles generally accepted in the United States of America

requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and income and expenses during the periods

Actual results could materially differ from those estimates.

We have not identified any critical accounting estimates.

Quantitative and Qualitative Disclosures About Market Risk

We are a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and are not required to provide the information otherwise

required under this item.

Quantitative and Qualitative Disclosures About Market

We are a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and are not required to provide the

information otherwise required under this item.

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-Q

Item 2. Management’s Discussion and Analysis