Company: OCEA
Filing Date: 2025-01-13
Form Type: 10-Q
Source: 0001493152-25-001880
Chunk: 227

Company: Ocean Biomedical, Inc.
Filing Date: 2025-01-13
Form: 10-Q
Item: Item 2
Chunk 227
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 of our outstanding shares of common stock as
of the date of the SPA.

The
interest rate applicable to each Note is, as of any date of determination, the lesser of (i) 8% per annum and (ii) the greater of (x)
5% per annum and (y) the sum of (a) the “secured overnight financing rate,” which from time to time is published in the “Money
Rates” column of The Wall Street Journal (Eastern Edition, New York Metro), in effect as of such date of determination and (b)
2% per annum. Each Note will mature on the first anniversary of its issuance. Additionally, each Note is required to be senior to all
of our other indebtedness, other than certain permitted indebtedness. The Notes will be secured by all of our existing and future assets
(including those of our significant subsidiaries). Upon the occurrence of certain events, the Notes will be payable in monthly installments.
A noteholder may, at its election, defer the payment of all or any portion of the installment amount due on any installment date to another
installment payment date.

All
or any portion of the principal amount of each Note, plus accrued and unpaid interest is convertible at any time, in whole or in part,
at the noteholder’s option, into shares of our common stock at an initial fixed conversion price of $10.34 per share, subject to
certain adjustments and alternative conditions. A noteholder will not have the right to convert any portion of a Note, to the extent
that, after giving effect to such conversion, the noteholder (together with certain of its affiliates and other related parties) would
beneficially own in excess of 9.99% of the shares of our common stock outstanding immediately after giving effect to such conversion.
Upon a change of control, noteholders may require us to redeem all, or any portion, of the Notes at a price stipulated by certain conditions
as discussed within the SPA.

The
Notes provide for certain events of default, including, among other things, any breach of the covenants described in the SPA and any
failure of Dr. Chirinjeev Kathuria to be the chairman of our Board of Directors. In connection with an event of default, the noteholders
may require us to redeem all or any portion of the Notes, at a premium set forth in the SPA.

We
are subject to certain customary affirmative and negative coven