Company: OCEA
Filing Date: 2025-01-13
Form Type: 10-Q
Source: 0001493152-25-001880
Chunk: 144

Company: Ocean Biomedical, Inc.
Filing Date: 2025-01-13
Form: 10-Q
Item: Item 8
Chunk 144
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2025. No payments have been made.

The Company shall issue to the investor 3,844,466 restricted shares of
its common stock in settlement of all past defaults and penalty shares to be issued in conjunction therewith, subject to a leak out of
15% of daily trading value unless the sales price of such shares is above $5.00 per share. The Company is also issuing the investor 1,332,806
warrants which shall be exchangeable on a one for one basis into restricted shares of common stock on or after August 1, 2024. All securities
are being issued in private placement transactions exempt from registration under Section 4(a)(2) under the Securities Exchange Act of
1934 as amended.

The principal amount of the new note issued in exchange for the Existing
Notes is $9.7 million, after giving effect to the principal amount of the Existing Notes, the Event of Default Interest to date and Redemption
Premium. At
July 15, 2024, the Existing Notes were valued at $7.1
million, consisting of the fair value of the
Existing Notes of $6.3
million, plus accrued and unpaid interest of
$0.8
million. The new $9.7
million notes were valued at $6.8
million, resulting in a gain on exchange of notes
of $0.3
million. Similarly, the Company valued the SPA
Warrants issued in 2023 at $1.6
million and the value of the SPA Warrants issued
in the exchange in 2024 at $3.8
million, resulting in a loss on exchange of notes
of $2.2
million. The Company has recorded a net loss
on exchange of notes of $1.9
million as other income (expense) on its condensed consolidated
statement of operations for the three months ended September 30, 2024. At September 30, 2024, the principal amount outstanding under the 2024
Convertible Note was $10.6 million.

As part of the agreement, Chirinjeev
Kathuria, the Company’s Chairman, and Poseidon Bio, LLC, an entity controlled by Dr. Kathuria, also agreed to grant a proxy on all
of their shares of the Company’s common stock to an independent third party, to vote them as that party sees fit, until such time
as the Notes are paid in full.

As of September