Company: OCEA
Filing Date: 2025-04-08
Form Type: 10-K
Source: 0001641172-25-003155
Chunk: 1541

Company: Ocean Biomedical, Inc.
Filing Date: 2025-04-08
Form: 10-K
Item: Item 10
Chunk 1541
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The
Board has discretion to amend the ESPP to any extent and in any manner it may deem advisable, provided that any amendment that would
be treated as the adoption of a new plan for purposes of Section 423 of the U.S. Internal Revenue Code of 1986, as amended (the “Code”)
will require stockholder approval. The Board may suspend or terminate the ESPP at any time. No purchases were made as of December 31,
2024 and 2023.

Profits
Interests in Poseidon

Legacy
Ocean’s founder and then sole stockholder was issued 17,454,542 shares of Legacy Ocean’s common stock (“Founders Shares”)
upon the formation of Legacy Ocean on January 2, 2019. After inception and prior to the Business Combination, the majority of the Founders
Shares were contributed to Poseidon Bio, LLC (“Poseidon”), with Poseidon subsequently granting Class A and Class B profit
interests to Legacy Ocean’s founder and other certain executives and employees, respectively, and resulting in Legacy Ocean’s
founder holding 100% of the voting power of Poseidon. Further, after inception and prior to the Business Combination, Legacy Ocean implemented
reverse stock splits which are appropriately reflected as applicable to the consolidated financial statements.

These
profit interests grants to the Company’s controlling shareholder were deemed to be transactions incurred by the shareholder
and within the scope of ASC 718, Stock Compensation. As a result, the related transactions by the shareholder were pushed
down into the Company’s consolidated financial statements. As of December 31, 2024 and 2023, Legacy Ocean’s founder held 100%
of the voting power and 68%
of the equity interests in Poseidon.

Stock-Based
Compensation

The
Company recognizes stock-based compensation costs for equity-based compensation awards granted to employees, nonemployees, and directors
in accordance with U.S. GAAP. The Company estimates the fair value and the resulting amounts using the Black-Scholes option-pricing model.
The fair value is recognized on a straight-line basis over the requisite service periods but accelerated to the extent that grants vest
sooner than on a straight-line basis. Forfeitures are accounted for as they occur and requires management to make a number of other assumptions,
including the volatility of the underlying shares, the risk-free interest rate, and expected dividends. Expected volatility is based
on the historical share volatility of a set of comparable publicly traded companies over a period of time equal to