Company: OCEA
Filing Date: 2025-01-13
Form Type: 10-Q
Source: 0001493152-25-001880
Chunk: 87

Company: Ocean Biomedical, Inc.
Filing Date: 2025-01-13
Form: 10-Q
Item: Item 1
Chunk 87
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 Backstop Parties purchased 3,535,466 Recycles Shares of AHAC’s Class
A common stock for $10.56 per share and (ii) pursuant to Polar’s exercise of its right to purchase Additional Shares, AHAC, Legacy
Ocean and Polar entered into a subscription agreement pursuant to which Polar purchased 1,350,000 newly issued shares of our common stock
at a per share purchase price of approximately $10.56 (the “Polar Subscription”). Under the Backstop Agreement, the Additional
Shares are subject to the same terms as the Recycled Shares, including with regard to repayment and repurchase.

We
agreed to purchase those shares from the Backstop Parties on a forward basis upon the “Maturity Date” (as amended, the third
anniversary of the closing of the Business Combination, subject to certain acceleration provisions). The purchase price payable by us
includes a prepayment in the amount of the redemption price per share (the “Prepayment”).

Subsequent
to Closing, the Prepayment amount was equal to $51.6 million, consisting of $37.3 million for the Recycled Shares and $14.3 million for
the Polar Subscription shares. As the $14.3 million was a netted transaction between us and Polar, only $37.3 million was paid out of
the funds we received from AHAC’s trust account. This net impact from the payment outflow to Backstop Parties for the Backstop
Agreement of $51.6 million and the proceeds inflow from the issuance of common stock pursuant to the Backstop Agreement and Polar Subscription
of $14.3 million are reported in our condensed consolidated statement of cash flows.

At
any time prior to the Maturity Date, the Backstop Parties may elect an optional early termination to sell some or all of the Recycled
Shares in the open market. If the Backstop Parties sell any shares prior to the Maturity Date, the pro-rata portion of the Prepayment
is due back to us. As of September 30, 2024, the Backstop Parties have sold 143,261 shares, for which we received net proceeds of $1.4
million, after paying related fees to the Backstop Parties. Depending on the manner in which the OTC Equity Prepaid Forward Transaction
is settled, we may never have access to the full Prepayment.

44

On
May 23, 2023 we received an Equity Prepaid Forward Transaction - Val