Company: OCEA
Filing Date: 2025-04-08
Form Type: 10-K
Source: 0001641172-25-003155
Chunk: 401

Company: Ocean Biomedical, Inc.
Filing Date: 2025-04-08
Form: 10-K
Item: Item 3
Chunk 401
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 were utilized to estimate the fair value of the associated liability.
The Company measures the fair value at each reporting period, with changes in fair value recorded within other income/(expense) in the
Company’s consolidated statements of operations. As of December 31, 2024 and 2023, it was determined that the fair value of the Ayrton Note
Purchase Option was zero.

The
following table summarizes some of the significant inputs and assumptions used in the Black-Scholes Merton model:

    Estimated volatility 
    Risk-free
rate
  
    Ayrton Note Purchase Option 
     13% 
     4.4%

158

Segments

We
operate and manage the business as one reportable and operating segment, which is the business of discovering and developing therapeutic
products in oncology, fibrosis, infectious diseases and inflammation. Our chief executive officer, who is the chief operating decision
maker, or CODM, reviews financial information on an aggregate basis for allocating and evaluating financial performance.

Off-Balance
Sheet Arrangements

We
did not have during the periods presented, and we do not currently have, any off-balance sheet arrangements, as defined in the rules
and regulations of the SEC.

Recently
Issued Accounting Pronouncements

In
August 2020, the FASB issued Accounting Standard Update (“ASU”) No. 2020-06, Debt — Debt with Conversion and Other
Options (Subtopic 470-20) and Derivatives and Hedging-Contracts in Entity’s Own Equity (Subtopic 815-40) — Accounting
for Convertible Instruments and Contracts in an Entity’s Own Equity, which simplifies the accounting for convertible instruments,
amends the guidance on derivative scope exceptions for contracts in an entity’s own equity, and modifies the guidance on diluted
earnings per share calculations as a result of these changes. The Company early adopted ASU 2020-06 as of January 1, 2023, using a modified
retrospective approach, noting the Company’s prior instruments would not be impacted by this adoption. The Company utilized the
updated derivative guidance when accounting for the 2023 Convertible Note (as defined in Note 7, Senior Secured Convertible Notes).

In November 2023, the FASB issued ASU No. 2023-07,
Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures (“ASU 2023-07”). ASU 2023-