Exhibit 10.1


 


[_____ __], 2021


Sanaby Health Acquisition Corp. I


2625 Middlefield Road #990


Palo Alto, CA 94306


 


	Re:	Initial Public Offering


 


Ladies and Gentlemen:


 


This letter (this “Letter Agreement”)
is being delivered to you in accordance with the Underwriting Agreement (the “Underwriting Agreement”)
entered into by and between Sanaby Health Acquisition Corp. I, a Delaware corporation (the “Company”), and
BTIG, LLC, as representative (the “Representative”) of the several underwriters (each,
an “Underwriter” and collectively, the “Underwriters”), relating to an
underwritten initial public offering (the “Public Offering”), of 17,250,000 of the Company’s units
(including up to 2,250,000 units that may be purchased to cover over-allotments, if any) (the “Units”),
each comprised of one share of the Company’s Class A common stock, par value $0.0001 per share (the “Common
Stock”), and one-half of one redeemable warrant. Each whole warrant (each, a “Warrant”)
entitles the holder thereof to purchase one share of Common Stock at a price of $11.50 per share, subject to adjustment. The Units
will be sold in the Public Offering pursuant to a registration statement on Form S-1 (File No. [ ]-[ ]) and prospectus (the
 “Prospectus”) filed by the Company with the U.S. Securities and Exchange Commission (the
 “Commission”) and the Company has applied to have the Units listed on The Nasdaq Capital Market. Certain
capitalized terms used herein are defined in paragraph 13 hereof. In order to induce the Company and the Underwriters to enter into
the Underwriting Agreement and to proceed with the Public Offering and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, each of Sanaby Health Sponsor I LLC (the “Sponsor”) and the
undersigned individuals, each of whom is a member of the Company’s board of directors and/or management team of the Company
(each, an “Insider” and collectively, the “Insiders”), hereby agrees with the
Company as follows:


 


1. The officers and directors of the Company will not enter into a
binding agreement for a proposed Business Combination or propose any Business Combination to shareholders of the Company, unless such
action is first approved by the managing member of the Sponsor.


 


2. Subject to Section 1, the Sponsor and each Insider agrees that if
the Company seeks stockholder approval of a proposed Business Combination, then in connection with such proposed Business Combination,
it, he or she shall (i) vote any shares of Capital Stock owned by it, him or her in favor of any proposed Business Combination and (ii)
not redeem any shares of Common Stock owned by it, him or her in connection with such stockholder approval. If the Company engages in
a tender offer in connection with any proposed Business Combination, the Sponsor and each Insider agrees that it, he or she will not seek
to sell its, his or her shares of Capital Stock to the Company in connection with such tender offer.


 


3. The Sponsor and each Insider hereby agrees that in the event
that the Company fails to consummate a Business Combination within 12 months, which is extendable at our sponsor’s option
up to 18 months, as described in the Prospectus, from the closing of the Public Offering, or such later period approved by the
Company’s stockholders in accordance with the Company’s amended and restated certificate of incorporation (the
 “Charter”), the Sponsor and each Insider shall take all reasonable steps to cause the Company to (i) cease
all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than 10 business days
thereafter, subject to lawfully available funds therefor, redeem 100% of the Common Stock sold as part of the Units in the Public
Offering (the “Offering Shares”), at a per-share price, payable in cash, equal to the aggregate amount
then on deposit in the Trust Account (as defined below), including interest earned on the funds held in the Trust Account and not
previously released to the Company to pay its taxes (less up to $100,000 of interest to pay dissolution expenses), divided by the
number of then outstanding Offering Shares, which redemption will completely extinguish all Public Stockholders’ rights as
stockholders (including the right to receive further liquidation distributions, if any), subject to applicable law, and (iii) as
promptly as reasonably possible following such redemption, subject to the approval of the Company’s remaining stockholders and
the Company’s board of directors, dissolve and liquidate, subject in each case to the Company’s obligations under
Delaware law to provide for claims of creditors and other requirements of applicable law. The Sponsor and each Insider agrees not to
propose any amendment to the Charter to modify (i) the substance or timing of the ability of holders of Offering Shares to seek
redemption in connection with a Business Combination, (ii) certain amendments to the Charter prior to the completion of a Business
Combination or (iii) (A) the Company obligation to redeem 100% of the Offering Shares if the Company does not complete a Business
Combination within such time set forth in the Charter or (B) any other provisions relating to stockholders' rights or pre-initial
Business Combination activity, unless the Company provides its public stockholders with the opportunity to redeem their shares of
Common Stock upon approval of any such amendment 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 the
Company to pay its taxes, divided by the number of then outstanding Offering Shares.


 






     


     


    

 


The Sponsor and each Insider acknowledges that it, he or she has no
right, title, interest or claim of any kind in or to any monies held in the Trust Account or any other asset of the Company as a result
of any liquidation of the Company with respect to the Founder Shares held by it, him or her. The Sponsor and each Insider hereby further
waives, with respect to any shares of Common Stock held by it, him or her, if any, whether acquired now or hereafter, any redemption rights
it, he or she may have in connection with the consummation of a Business Combination, including, without limitation, any such rights available
in the context of a stockholder vote to approve such Business Combination or a stockholder vote to approve an amendment to the Charter
to modify (i) the substance or timing of the ability of holders of Offering Shares to seek redemption in connection with a Business Combination
or (ii) (A) the Company’s obligation to redeem 100% of the Offering Shares if the Company does not complete a Business Combination
within such time set forth in the Charter or (B) any other provisions relating to stockholders' rights or pre-initial Business Combination
activity, unless the Company provides its public stockholders with the opportunity to redeem their shares of Common Stock upon approval
of any such amendment 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 the Company to pay its taxes, divided by the number
of then outstanding Offering Shares, or (iii) in the context of a tender offer made by the Company to purchase shares of Common Stock
(although the Sponsor, the Insiders and their respective affiliates shall be entitled to redemption and liquidation rights with respect
to any Offering Shares it or they hold if the Company fails to consummate a Business Combination within the time period set forth in the
Charter).


 


4. During the period commencing on the date of the Underwriting Agreement
and ending 180 days after such date, the Sponsor and each Insider shall not, without the prior written consent of the Representative,
(i) sell, offer to sell, contract or agree to sell, hypothecate, pledge, grant any option to purchase or otherwise dispose of or agree
to dispose of, directly or indirectly, or establish or increase a put equivalent position or liquidate or decrease a call equivalent position
within the meaning of Section 16 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and
the rules and regulations of the Commission promulgated thereunder, with respect to any Units, shares of Capital Stock, Warrants or any
securities convertible into, or exercisable, or exchangeable for, shares of Capital Stock owned by it, him or her, (ii) enter into any
swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of any Units,
shares of Capital Stock, Warrants or any securities convertible into, or exercisable, or exchangeable for, shares of Capital Stock owned
by it, him or her, whether any such transaction is to be settled by delivery of such securities, in cash or otherwise, or (iii) publicly
announce any intention to effect any transaction specified in clause (i) or (ii). Each of the Insiders and the Sponsor acknowledges and
agrees that, prior to the effective date of any release or waiver, of the restrictions set forth in this paragraph 4 or paragraph 8 below,
the Company shall announce the impending release or waiver by press release through a major news service at least two business days before
the effective date of the release or waiver. Any release or waiver granted shall only be effective two business days after the publication
date of such press release. The provisions of this paragraph will not apply if the release or waiver is effected solely to permit a transfer
not for consideration and the transferee has agreed in writing to be bound by the same terms described in this Letter Agreement to the
extent and for the duration that such terms remain in effect at the time of the transfer.


 


5. In the event of the liquidation of the Trust Account upon the
failure of the Company to consummate its initial Business Combination within the time period set forth in the Charter, the Sponsor
(the “Indemnitor”) agrees to indemnify and hold harmless the Company against any and all loss, liability,
claim, damage and expense whatsoever (including, but not limited to, any and all legal or other expenses reasonably incurred in
investigating, preparing or defending against any litigation, whether pending or threatened) to which the Company may become subject
as a result of any claim by (i) any third party for services rendered or products sold to the Company or (ii) any prospective target
business with which the Company has entered into a written letter of intent, confidentiality or other similar agreement or Business
Combination agreement (a “Target”); provided, however, that such indemnification of the Company by the
Indemnitor shall (x) apply only to the extent necessary to ensure that such claims by a third party or a Target do not reduce the
amount of funds in the Trust Account to below the lesser of (i) $10.15 per Offering Share and (ii) the actual amount per Offering
Share held in the Trust Account as of the date of the liquidation of the Trust Account, if less than $10.15 per Offering Share is
then held in the Trust Account due to reductions in the value of the trust assets, less interest earned on the Trust Account which
may be withdrawn to pay taxes, (y) not apply to any claims by a third party or a Target which executed a waiver of any and all
rights to the monies held in the Trust Account (whether or not such waiver is enforceable) and (z) not apply to any claims under the
Company’s indemnity of the Underwriters against certain liabilities, including liabilities under the Securities Act of 1933,
as amended. The Indemnitor shall have the right to defend against any such claim with counsel of its choice reasonably satisfactory
to the Company if, within 15 days following written receipt of notice of the claim to the Indemnitor, the Indemnitor notifies the
Company in writing that it shall undertake such defense.


 






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6. To the extent that the Underwriters do not exercise their over-allotment
option to purchase up to an additional 2,250,000 Units in full within 45 days from the date of the Prospectus (and as further described
in the Prospectus), the Sponsor agrees to forfeit, at no cost, a number of Founder Shares in the aggregate equal to 675,000 multiplied
by a fraction, (i) the numerator of which is 2,250,000 minus the number of Units purchased by the Underwriters upon the exercise of their
over-allotment option, and (ii) the denominator of which is 2,250,000. The Sponsor will be required to forfeit only that number of Founder
Shares as is necessary so that the Initial Stockholders will own an aggregate of 23.1% of the Company’s issued and outstanding shares
of Capital Stock after the Public Offering.


 


7. The Sponsor and each Insider hereby agrees and acknowledges that:
(i) the Underwriters and the Company would be irreparably injured in the event of a breach by such Sponsor or an Insider of its, his or
her obligations under paragraphs 1, 2, 3, 4, 5, 6, 8(a), 8(b), 9, 10, 11 and 14 as applicable, of this Letter Agreement (ii) monetary
damages may not be an adequate remedy for such breach and (iii) the non-breaching party shall be entitled to injunctive relief, in addition
to any other remedy that such party may have in law or in equity, in the event of such breach.


 


8. (a) The Sponsor and each Insider agrees that it, he or she
shall not Transfer any Founder Shares (or shares of Common Stock issuable upon conversion thereof) until the earlier to occur of (A)
one year after the completion of our initial business combination and (B) the date on which we complete a liquidation, merger,
capital stock exchange or other similar transaction after our initial business combination that results in all of our stockholders
having the right to exchange their Class A common stock for cash, securities or other property. Any permitted transferees will be
subject to the same restrictions and other agreements of our initial stockholders with respect to any founder shares. We refer to
such transfer restrictions throughout this prospectus as the lock-up. Notwithstanding the foregoing, if (1) the closing price of our
Class A common stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock capitalizations, reorganizations,
recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least 150 days after our
initial business combination or (2) if we consummate a transaction after our initial business combination which results in our
stockholders having the right to exchange their shares for cash, securities or other property, the founder shares will be released
from the lock-up. (the “Founder Shares
Lock-up Period”).


 


(b) The Sponsor and each Insider agrees that it, he or she shall not
Transfer any Private Placement Warrants (or shares of Common Stock issued or issuable upon the exercise of the Private Placement Warrants),
until 30 days after the completion of a Business Combination (the “Private Placement Warrants Lock-up Period”,
together with the Founder Shares Lock-up Period, the “Lock-up Periods”).


 


(c) Notwithstanding the provisions set forth in paragraphs 4,
8(a) and (b), Transfers of the Founder Shares, Private Placement Warrants and shares of Common Stock issued or issuable upon the
exercise or conversion of the Private Placement Warrants or the Founder Shares and that are held by the Sponsor, any Insider or any
of their permitted transferees (that have complied with this paragraph 8(c)), are permitted (a) to the Company’s officers or
directors, any affiliate or family member of any of the Company’s officers or directors or any affiliate of the Sponsor or to
any member(s) of the Sponsor or any of their affiliates; (b) in the case of an individual, by gift to a member of such
individual’s immediate family or to a trust, the beneficiary of which is a member of such individual’s immediate family,
an affiliate of such individual or to a charitable organization; (c) in the case of an individual, by virtue of laws of descent and
distribution upon death of such individual; (d) in the case of an individual, pursuant to a qualified domestic relations order; (e)
by private sales or transfers made in connection with the consummation of an initial Business Combination at prices no greater than
the price at which the shares or warrants were originally purchased; (f) in the event of the Company’s liquidation prior to
the completion of an initial Business Combination; or (g) by virtue of the laws of the State of Delaware or the Sponsor’s
limited liability company agreement upon dissolution of the Sponsor; provided, however, that in each case these
permitted transferees must enter into a written agreement with the Company agreeing to be bound by the transfer restrictions
herein.


 






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9. The Sponsor and each Insider represents and warrants that it, he
or she has never been suspended or expelled from membership in any securities or commodities exchange or association or had a securities
or commodities license or registration denied, suspended or revoked. Each Insider’s biographical information furnished to the Company
(including any such information included in the Prospectus) is true and accurate in all respects and does not omit any material information
with respect to the Insider’s background. Each Insider’s questionnaire furnished to the Company is true and accurate in all
respects. Each Insider represents and warrants that: it, he or she is not subject to or a respondent in any legal action for, any injunction,
cease-and-desist order or order or stipulation to desist or refrain from any act or practice relating to the offering of securities in
any jurisdiction; it, he or she has never been convicted of, or pleaded guilty to, any crime (i) involving fraud, (ii) relating to any
financial transaction or handling of funds of another person, or (iii) pertaining to any dealings in any securities and it, he or she
is not currently a defendant in any such criminal proceeding.


 


10. Except as disclosed in the Prospectus, neither the Sponsor nor
any officer, director, advisor or any affiliate of the Sponsor, officer, director or advisor of the Company, shall receive from the Company
any finder’s fee, reimbursement, consulting fee, monies in respect of any repayment of a loan or other compensation prior to, or
in connection with any services rendered in order to effectuate, the consummation of the Company’s initial Business Combination
(regardless of the type of transaction that it is).


 


11. Each Insider agrees that, until the consummation of the Business
Combination and for one year thereafter, he or she will keep confidential all confidential, proprietary and non-public information of
the Company (whether written, oral or electronic communications), including without limitation, the names of the targets identified by
the Company for a potential Business Combination and any and all information provided by the Company to the Insider regarding such targets.


 


12. The Sponsor and each Insider has full right and power, without
violating any agreement to which it is bound (including, without limitation, any non-competition or non-solicitation agreement with any
employer or former employer), to enter into this Letter Agreement and, as applicable, to serve as an officer and/or director on the board
of directors of the Company and hereby consents to being named in the Prospectus as an officer and/or director of the Company.


 


13. As used herein, (i) “Business
Combination” shall mean a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar
business combination, involving the Company and one or more businesses; (ii) “Capital Stock” shall mean,
collectively, the Common Stock and the Founder Shares; (iii) “Founder Shares” shall mean (a) the 5,175,500
shares of the Company’s Class B common stock, par value $0.0001 per share, initially issued to the Sponsor (up to 675,000 of
which are subject to complete or partial forfeiture by the Sponsor if the over-allotment option is not exercised by the
Underwriters) for an aggregate purchase price of $25,000, or approximately $0.005 per share, prior to the consummation of the Public
Offering; (iv) “Initial Stockholders” shall mean the Sponsor and any Insider that holds Founder Shares;
(v) “Private Placement Warrants” shall mean the Warrants to purchase up to 6,895,000 shares (or 7,232,500
shares if the underwriters exercise their over-allotment option in full) of Common Stock of the Company that the Sponsor has agreed to purchase for an aggregate purchase price of $6,895,000
(or $7,232,500 if the underwriters exercise their over-allotment option in full) in the aggregate, or $1.00 per Warrant, in a private
placement that shall occur simultaneously with the consummation of the Public Offering; (vi) “Public
Stockholders” shall mean the holders of securities issued in the Public Offering; (vii) “Trust
Account” shall mean the trust fund into which a portion of the net proceeds of the Public Offering shall be deposited;
and (viii) “Transfer” shall mean the (a) sale of, offer to sell, contract or agreement to sell,
hypothecate, pledge, grant of any option to purchase or otherwise dispose of or agreement to dispose of, directly or indirectly, or
establishment or increase of a put equivalent position or liquidation with respect to or decrease of a call equivalent position
within the meaning of Section 16 of the Exchange Act, and the rules and regulations of the Commission promulgated thereunder with
respect to, any security, (b) entry into any swap or other arrangement that transfers to another, in whole or in part, any of the
economic consequences of ownership of any security, whether any such transaction is to be settled by delivery of such securities, in
cash or otherwise, or (c) public announcement of any intention to effect any transaction specified in clause (a) or (b).


 






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14. The Company will maintain an insurance policy or policies providing
directors’ and officers’ liability insurance, and each Director shall be covered by such policy or policies, in accordance
with its or their terms, to the maximum extent of the coverage available for any of the Company’s directors or officers.


 


15. This Letter Agreement constitutes the entire agreement and understanding
of the parties hereto in respect of the subject matter hereof and supersedes all prior understandings, agreements, or representations
by or among the parties hereto, written or oral, to the extent they relate in any way to the subject matter hereof or the transactions
contemplated hereby. This Letter Agreement may not be changed, amended, modified or waived (other than to correct a typographical error)
as to any particular provision, except by a written instrument executed by all parties hereto.


 


16. No party hereto may assign either this Letter Agreement or any
of its rights, interests, or obligations hereunder without the prior written consent of the other parties. Any purported assignment in
violation of this paragraph shall be void and ineffectual and shall not operate to transfer or assign any interest or title to the purported
assignee. This Letter Agreement shall be binding on the Sponsor and each Insider and their respective successors, heirs and assigns and
permitted transferees.


 


17. Nothing in this Letter Agreement shall be construed to confer upon,
or give to, any person or corporation other than the parties hereto any right, remedy or claim under or by reason of this Letter Agreement
or of any covenant, condition, stipulation, promise or agreement hereof. All covenants, conditions, stipulations, promises and agreements
contained in this Letter Agreement shall be for the sole and exclusive benefit of the parties hereto and their successors, heirs, personal
representatives and assigns and permitted transferees.


 


18. This Letter Agreement may be executed in any number of original
or facsimile counterparts and each of such counterparts shall for all purposes be deemed to be an original, and all such counterparts
shall together constitute but one and the same instrument.


 


19. This Letter Agreement shall be deemed severable, and the invalidity
or unenforceability of any term or provision hereof shall not affect the validity or enforceability of this Letter Agreement or of any
other term or provision hereof. Furthermore, in lieu of any such invalid or unenforceable term or provision, the parties hereto intend
that there shall be added as a part of this Letter Agreement a provision as similar in terms to such invalid or unenforceable provision
as may be possible and be valid and enforceable.


 


20. This Letter Agreement shall be governed by and construed and enforced
in accordance with the laws of the State of New York, without giving effect to conflicts of law principles that would result in the application
of the substantive laws of another jurisdiction. The parties hereto (i) all agree that any action, proceeding, claim or dispute arising
out of, or relating in any way to, this Letter Agreement shall be brought and enforced in the courts of New York City, in the State of
New York, and irrevocably submit to such jurisdiction and venue, which jurisdiction and venue shall be exclusive and (ii) waive any objection
to such exclusive jurisdiction and venue or that such courts represent an inconvenient forum.


 


21. Any notice, consent or request to be given in connection with any
of the terms or provisions of this Letter Agreement shall be in writing and shall be sent by express mail or similar private courier service,
by certified mail (return receipt requested), by hand delivery or facsimile transmission.


 


22. This Letter Agreement shall terminate on the earlier of (i)
the expiration of the Lock-up Periods or (ii) the liquidation of the Company; provided, however, that this Letter Agreement shall
earlier terminate in the event that the Public Offering is not consummated and closed by December 31, 2021; provided further that
paragraphs 4 and 11 of this Letter Agreement shall survive such liquidation.


 


23. The Company, the Sponsor and each Insider hereby acknowledges and
agrees that the Representative on behalf of the Underwriters is a third party beneficiary of this Letter Agreement.


 






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Sincerely,


 


	 	SANABY HEALTH SPONSOR I LLC
	 	 	 
	 	 	 
	 	
    By:
	 
	 	 	Name: 	Sandra Shpilberg
	 	 	Title:	Managing Member


 


	
    Acknowledged and Agreed:
	 
	SANABY HEALTH ACQUISITION CORP. I	 
	 	 	 	 


 


	By: 	                	 
	Name: Sandra Shpilberg	 
	Title: Chief Executive Officer and Director	 
	 	 
	 	 
	By: 	 	 
	Name: Mark Joing	 
	Title: Chief Financial Officer, Chief Operating Officer, and Director	 
	 	 
	 	 
	By: 	 	 
	Name: Timothy Zanni	 
	Title: Chairman and Director	 
	 	 
	 	 
	By: 	 	 
	Name: Anthony Japour	 
	Title: Director	 
	 	 
	 	 
	By: 	 	 
	Name: Barbara Nelsen	 
	Title: Director	 



 


[Signature Page to Letter Agreement]


 








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