SecProbe.io

CORRESP
1
filename1.htm

NELSON
MULLINS RILEY & SCARBOROUGH LLP

ATTORNEYS AND COUNSELORS AT LAW

    Andy Tucker

        T: 202.689.2987

        Andy.Tucker@nelsonmullins.com

101
Constitution Avenue, NW

Suite
900

Washington
D.C., 20001

T:
202.689.2800 F: 202.689.2860

nelsonmullins.com

November
22, 2022

Division
of Corporation Finance

U.S.
Securities and Exchange Commission

100
F Street, N.E.

Washington,
DC 20549

    Attention:
    Tracey Houser

    Daniel
Crawford

RE: Aesther
                                            Healthcare Acquisition Corp.

  Amendment No
                                            1. to Preliminary Proxy Statement on Schedule 14A

  Filed October
                                            26, 2022

  File No. 001-40793

Ladies
and Gentlemen:

On
behalf of Aesther Healthcare Acquisition Corp. (the “Company”), we are hereby responding to the letter dated November
9, 2022 (the “Comment Letter”) from the staff (the “Staff”) of the Securities and Exchange Commission
(“SEC” or the “Commission”), regarding the Company’s Amendment No. 1 to Preliminary Proxy
Statement on Schedule 14A filed on October 26, 2022 (the “Proxy Statement”). In response to the Comment Letter and
to update certain information in the Proxy Statement, the Company is submitting its Amendment No. 2 to the Proxy Statement (the “Amended
Proxy Statement”) with the Commission today. Please note that, in addition to updates made to address the Staff’s comments,
the financial presentations in the Amended Proxy Statement have been updated to reflect information as of September 30, 2022.

Capitalized
terms used but not defined in this letter have the meanings as defined in the Amended Proxy Statement.

For
ease of reference, the text of the Staff’s comment is included in bold-face type below, followed by the Company’s response.

Amendment
No. 1 to Preliminary Proxy Statement on Schedule 14A filed October 26, 2022 General, page [-]

1. We
                                            note your agreements with Vellar and Meteora obligate AHAC and New Ocean Biomedical to repurchase
                                            the shares they purchase in furtherance of the agreement. Please provide us with an analysis
                                            as to how these agreements, which may result in the repurchase of shares at a price as high
                                            as the redemption price plus $2.50 payable in common shares of New Ocean Biomedical, comply
                                            with Rule 14e-5.

Response:
The Company acknowledges the Staff’s comment. In our view, the Vellar Backstop Agreement complies with Rule 14e-5 because of Rule
14e-5(b)(7) which provides an exception from the general rule arrangements to purchase pursuant to a contract if (i) such contract was
entered into before public announcement of the tender offer, (ii) the contract is unconditional and binding on both parties, and (iii)
the existence of the contract and its material terms are disclosed in the offering materials. The Vellar Backstop Agreement was entered
into concurrently with the Business Combination Agreement and prior to its announcement, it is unconditional and binding on both parties
and we have disclosed all material terms in the proxy statement. With respect to the Meteora Backstop Agreement, we acknowledge that,
as currently drafted, the variable nature of the maturity consideration renders unclear that agreement’s compliance with Rule 14e-5.
As a result, the parties to the Meteora Backstop Agreement have decided to amend the agreement such that the maturity consideration is
a pre-established, fixed number of shares (specifically, 1,000,000 shares of AHAC Class A common stock) payable by the Company to Meteora
within three years of the Meteora Backstop Agreement’s effective date.

California
| Colorado | District of Columbia | Florida | Georgia | Maryland | Massachusetts | New York

North Carolina | South Carolina | Tennessee
| West Virginia

November
22, 2022

Page 2

Questions
and Answers About the Proposals for Stockholders

What
interests do AHAC’s current officers and directors have in the Business Combination?, page 13

2. We
                                            note your response to comment 5 and reissue our comment. Please revise your disclosure discussing
                                            the interests of AHAC’s current officers and directors in the Business Combination
                                            to highlight the risk related to the sponsor’s incentive to complete any acquisition
                                            rather than liquidate and the potential result of completing an acquisition that might not
                                            be favorable to the public shareholders as it is to your sponsors. For example, disclose
                                            the effect a liquidation will have on the Sponsor’s Class B common stock, Private Placement
                                            Warrants and $1,050,000 loan.

Response:
The Company acknowledges the Staff’s comment and has made the changes on pages 4, 12, 13, 24, 114, 115, 123, 124
and 135 of the Amended Proxy Statement.

Summary
of the Proxy Statement, page 19

3. We
                                            note your response to comment 2 and your revised disclosure on page 19 indicating the conditions
                                            that AHAC has at least $5,000,001 of tangible net assets and the shares of New Ocean being
                                            listed on NASDAQ are not waivable conditions. Your response and these revisions imply that
                                            the other conditions presented can be waived. Please revise to clarify which conditions are
                                            subject to waiver. To the extent you believe the remaining conditions can be waived, please
                                            explain how you will complete the merger if you do not obtain shareholder approval from the
                                            stockholders of each company; if you do not obtain the approval of any required government
                                            authorities; if there is a law or order preventing the transaction; etc. Additionally, please
                                            note that the disclosure on page 130 continues to indicate that the Nasdaq listing and $5,000,001
                                            net tangible asset conditions can be waived.

Response:
The Company acknowledges the Staff’s comment and has made the changes on pages 19, 20, and 131 of the Amended Proxy Statement.

4. Please
                                            revise this discussion to quantify the total estimated amount New Ocean Biomedical may have
                                            to pay Vellar and Meteora assuming Vellar and Meteora purchase the maximum amount of shares
                                            pursuant to the Backstop Agreements and elect to sell them all back to the combined company
                                            at maturity, including the $2.50 per share payments. Additionally, revise your risk factor
                                            on page 54 to disclose the dilutive effects of issuing new stock subject to the Backstop
                                            Agreements.

Response:
The Company acknowledges the Staff’s comment and has made the changes on pages 21, 22 and 55 of the Amended Proxy Statement.
The Staff should note that, as explained in response to Comment 1 (above), the Meteora Backstop Agreement was amended to eliminate the
$2.50 per share payment payable to Meteora upon the Maturity of the Meteora Backstop Agreement. Instead, the Company has agreed to issue
Meteora 1,000,000 shares on or prior to the three-year anniversary of the Meteora Backstop Agreement.

November 22, 2022

Page 3

Unaudited
Pro Forma Condensed Combined Financial Information

Basis
of Pro Forma Presentation, page 32

5. Please
                                            expand your description of the preparation of the pro forma condensed combined financial
                                            information to also include the alternative levels of utilization of the Backstop Agreements,
                                            as there are seven scenarios presented and not just the four for the various redemption scenarios
                                            provided.

Response:
The Company acknowledges the Staff’s comment and has made the changes on pages 32 and 33 of the Amended Proxy Statement. As discussed
in the response to the Staff’s comment 12(e), the Company has revised the proforma financial information as follows:

 1. Removed
                                            from scenarios 2, 3 and 4 the assumption that Vellar and Meteora resells the shares they
                                            acquired under the Backstop Agreement on the Closing Date, making them the same as the original
                                            scenarios 5, 6 and 7.

 2. Revised
                                            scenarios 5, 6 and 7 to assume that Vellar and Meteora do not purchase any shares under the
                                            Backstop Agreements, as requested by the Staff in comment 12(e).

 3. Revised
                                            the shares to be issued to the Ocean Biomedical stockholders from 24,000,000 to 23,874,945,
                                            reflecting that a portion of the merger consideration is being allocated to the shares of
                                            New Ocean Biomedical issuable upon the exercise of the Second Street warrants. In particular,
                                            the disclosure reflects that the $240 million in transaction consideration is divided into
                                            (i) $238,749,455 payable to the Ocean Biomedical stockholders at closing in the form of 23,874,945
                                            shares of New Ocean Biomedical common stock and (ii) $1,250,545 related to the economic value
                                            of the Second Street warrants at Closing.

 4. Expanded
                                            the discussion of the terms of the conversion of the Second Street warrants from warrants
                                            exercisable for Ocean Biomedical common stock into warrants exercisable for New Ocean Biomedical
                                            common stock post-Closing. In particular, the disclosure reflect that the warrants will be
                                            exercisable for 614,055 shares of New Ocean Biomedical common stock post-Closing.

 5. The
                                            amendment to the Meteora Backstop Agreement referenced in the Company’s response to
                                            the Staff’s comment 1.

6. Please
                                            expand your disclosures to include all potential sources of dilution. Refer to your disclosures
                                            for the Ocean Warrants on page 37. Please address this comment throughout your document in
                                            which warrants or other dilutive securities are discussed.

Response:
The Company acknowledges the Staff’s comment and has made the changes on pages 2, 8, 31-34, 43, 117, 129 and 130
of the Amended Proxy Statement.

1.
Basis of Presentation

General
Description of the Business Combination Agreement, page 37

7. With
                                            reference to prior comment 8, please provide a prominent discussion of the two conditions
                                            required to be met to close the business combination, including a calculation of both conditions
                                            under each scenario. For each scenario that one or both of these conditions are not met,
                                            explain how you intend to address these required conditions and/or provide a fulsome explanation
                                            of the consequences of not meeting the corresponding condition to the transaction, AHAC’s
                                            business and AHAC’s shareholders. If there are scenarios in which you will not meet
                                            one or both of these conditions, address this comment throughout the document where the conditions
                                            to close are discussed.

Response:
The Company acknowledges the Staff’s comment and has made the changes on page 33 of the Amended Proxy Statement.

Merger
Consideration, page 37

8. As
                                            requested in prior comment 12, please expand your disclosure to include a discussion of the
                                            material terms for the Earnout Shares along with your intended accounting for this consideration
                                            to both Ocean Biomedical and Sponsor recipients. As part of your response, please provide
                                            us with your assessment of the material terms for each type of recipient along with your
                                            consideration of the guidance in ASC 480, ASC 815-40, and ASC 718 for any employee.

Response:
The Company acknowledges the Staff’s comment and has made the changes on page 38 of the Amended Proxy Statement.

November 22, 2022

Page 4

9. As
                                            requested in prior comment 12, please address the Extension Share Award component of the
                                            merger consideration, as discussed on page 128.

Response:
The Company acknowledges the Staff’s comment and has made the changes on page 38 of the Amended Proxy Statement.

10. Please
                                            expand your disclosure for the Ocean Warrants to state the number of New Ocean Biomedical
                                            warrants that will be issued along with the material terms of these warrants.

Response:
The Company acknowledges the Staff’s comment and has made the changes on page 38 of and throughout the Amended Proxy Statement.

11. For
                                            the Class B Units Profit Interest held by Ocean Biomedical employees, please expand your
                                            disclosure to state whether this transaction will have an impact on those interests and whether
                                            Poseidon Bio will continue to make such grants subsequent to this transaction.

Response:
The Company acknowledges the Staff’s comment and has made the changes on pages 38 and 235 of the Amended Proxy Statement.

2.
Adjustments to Unaudited Pro Forma Combined Financial Information

Adjustments
to Unaudited Pro Forma Condensed Combined Balance Sheet, page 38

12. For
                                            footnote (2) with reference to prior comment 13, please address the following:

 a) Clarify
                                            what the “redemption period” and “expiration of the redemption offer”
                                            are in the last paragraph on page 38.

Response:
The Company acknowledges the Staff’s comment and has made the changes on pages 21, 39, 40, 132, 133, 239, 240,
F-69, and F-71 of the Amended Proxy Statement.

 b) Disclose
                                            any material differences between the material terms of the Vellar Backstop Agreement and
                                            t