Company: OCEA
Filing Date: 2025-04-08
Form Type: 10-K
Source: 0001641172-25-003155
Chunk: 450

Company: Ocean Biomedical, Inc.
Filing Date: 2025-04-08
Form: 10-K
Item: Item 3
Chunk 450
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 to the recoverability and classification
of recorded asset amounts or the amounts and classification of liabilities that might result from the outcome of this uncertainty.

Impacts
of Market Conditions on Our Business

Disruption
of global financial markets and a recession or market correction, including the ongoing military conflict between Russia and Ukraine
and the related sanctions imposed against Russia, the effects of Hamas’ attack of Israel and the ensuing war, and other global
macroeconomic factors such as inflation and rising interest rates, could reduce the Company’s ability to access capital, which
could in the future negatively affect the Company’s liquidity and could materially affect the Company’s business and the
value of its common stock.

2.
Basis of Presentation and Summary of Significant Accounting Policies

Basis
of Presentation

The
accompanying consolidated financial statements have been prepared in conformity with U.S. GAAP and stated in U.S. dollars. Any
reference in these notes to applicable guidance is meant to refer to the authoritative U.S. GAAP as found in the Accounting
Standards Codification (“ASC”) and Accounting Standards Updates (“ASU”) of the Financial Accounting
Standards Board (“FASB”).

    F-9

The
accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries after elimination
of all intercompany accounts and transactions. The subsidiaries were formed to organize the Company’s therapeutic programs in order
to optimize multiple commercialization options and to maximize each program’s value.

Revision of Prior Period Financial Statements

During the three months ended March 31, 2025, the
Company determined that it had not appropriately reflected the fair value of certain warrants issued in July 2024. This resulted in an
overstatement of current liabilities, accumulated deficit as of September 30, 2024, and an overstatement of other expenses for the three
month and nine month periods ended September 30, 2024.

Based on an analysis of Accounting
Standards Codification ASC 250 – “Accounting Changes and Error Corrections” (“ASC 250”), Staff Accounting
Bulletin 99 – “Materiality” and Staff Accounting Bulletin 108 – “Considering the Effects of Prior Year Misstatements
when Quantifying Misstatements in Current Year Financial Statements”, the Company determined that these errors were immaterial to
the previously issued financial statements, and as such no restatement was necessary. Correcting prior period financial statements for
immaterial errors would not require previously filed reports to be amended.

The effect of the adjustments