Company: OCEA
Filing Date: 2025-04-08
Form Type: 10-K
Source: 0001641172-25-003155
Chunk: 1064

Company: Ocean Biomedical, Inc.
Filing Date: 2025-04-08
Form: 10-K
Item: Item 7
Chunk 1064
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 Beginning on January
1, 2028, and every year thereafter the annual license maintenance fee shall become $4,000 per year. Upon successful commercialization,
we are required to pay Elkurt between 0.5% to 1.5% of net sales based on the terms under the Initial Brown License Agreements. In addition,
we must pay Elkurt, under each of the Initial Brown License Agreements, 25% of all non-royalty sublicense income prior to the first commercial
sale, and 10% of non-royalty sublicense income thereafter, in the event that we enter into sublicenses for the subject intellectual property.
If net sales or non-royalty sublicense income are generated from know-how products, the amounts otherwise due (royalty or non-royalty
sublicense income) shall be reduced by 50%. For the fiscal years ended December 31, 2024 and 2023, the Company recorded annual license
maintenance fees of $12 thousand in each year. For the fiscal year ended December 31, 2023, the Company recorded license fees of $0.3
million. On June 13, 2024, we amended the Initial Brown License Agreements such that $0.2 million of past due license fees were paid
on July 17, 2024, and $0.2 million of past due license fees and $0.1 million in past due patent expenses were to be paid by October 1,
2024, which remain unpaid and are subject to negotiation between the parties.

We
will also pay Elkurt developmental and commercialization milestone payments for each of the Initial Brown License Agreements ranging
from $50,000 for the filing of an IND, or the equivalent outside of the United States, to $0.3 million for enrollment of the first patient
in a Phase 3 clinical trial in the United States or the equivalent outside of the United States. We are also responsible for reimbursement
of patent costs. We recorded reimbursement of patent costs as general and administrative costs in the statements of operations as incurred.
For the fiscal years ended December 31, 2024 and 2023, the Company incurred reimbursed patent costs expenses to Brown University in the
amount of $0.1 million each year. As of December 31, 2024 and 2023, the Company reflected a balance due of $0.1 million in
accrued expenses – related parties on its consolidated balance sheets.

The