Company: OCEA
Filing Date: 2025-04-08
Form Type: 10-K
Source: 0001641172-25-003155
Chunk: 2238

Company: Ocean Biomedical, Inc.
Filing Date: 2025-04-08
Form: 10-K
Item: Item 1A
Chunk 2238
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2024 and 2023, the Company identified material weaknesses as defined under
the Securities Exchange Act of 1934, as amended, or the Exchange Act, and by the Public Company Accounting Oversight Board (United States)
in its internal control over financial reporting. A material weakness is a deficiency, or a combination of deficiencies, in internal
control over financial reporting, such that there is a reasonable possibility that a material misstatement of the company’s financial
statements will not be prevented or detected on a timely basis.

Specifically,
the Company’s material weaknesses were due to:

  ●
  the
  fact that its management does not have adequate staffing in its accounting department and has not yet designed and implemented the
  appropriate processes and internal controls to support accurate and timely financial reporting; and

  ●
  During
  the audit process for December 31, 2024, management identified a material weakness in the design of the Company’s internal controls
  related to our review of third-party valuation deliverables regarding our convertible debt and warrant liability.

The
Company is working to remediate the material weaknesses and is taking steps to strengthen its internal control over financial reporting
such as the Company’s hiring of Jolie Kahn as its Chief Financial Officer in the first quarter of 2024. Additionally, the Company
plans to further develop and implement formal policies, processes and documentation procedures relating to financial reporting, including
the oversight of third-party service providers. The actions that the Company is taking are subject to ongoing executive management review.
If the Company is unable to successfully remediate the material weaknesses, or if in the future, we identify further material weaknesses
in our internal controls over financial reporting, we may not detect errors on a timely basis, and our financial statements may be materially
misstated. We or our independent registered public accounting firm may not be able to conclude on an ongoing basis that we have effective
internal control over financial reporting, which could harm our operating results, cause investors to lose confidence in our reported
financial information and cause the trading price of our stock to fall. In addition, as a public company, we will be required to file
accurate and timely quarterly and annual reports with the SEC under the Exchange Act. Any failure to report our financial results on
an accurate and timely basis could result in sanctions, lawsuits, delisting of our shares from Nasdaq or other adverse consequences that
would materially harm our business. In addition, we could become subject to investigations by Nasdaq, the SEC, and