Company: OCEA
Filing Date: 2025-01-13
Form Type: 10-Q
Source: 0001493152-25-001880
Chunk: 109

Company: Ocean Biomedical, Inc.
Filing Date: 2025-01-13
Form: 10-Q
Item: Item 8
Chunk 109
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 Ocean Sihoma Inc., and (iv)
Ocean Promise, Inc. The Business Combination is accounted for as the equivalent of a capital transaction in which the Company has issued
stock for the net assets of AHAC.

The
Company’s common stock and warrants commenced trading on the Nasdaq Stock Market LLC under the symbols “OCEA” and “OCEAW,”
respectively, on February 15, 2023. Refer to Note 3, Business Combination and Backstop Agreement, for additional details.

The
Company is subject to risks common to companies in the biopharmaceutical industry, including, but not limited to, risks related to the
successful development and commercialization of product candidates, fluctuations in operating results and financial risks, the ability
to successfully raise additional funds when needed, protection of proprietary rights and patent risks, patent litigation, compliance
with government regulations, dependence on key personnel and prospective collaborative partners, and competition from competing products
in the marketplace.

Going
Concern Considerations

The
accompanying condensed consolidated financial statements are prepared in accordance with U.S. GAAP applicable to a going concern, which
contemplates the realization of assets and the satisfaction of liabilities in the normal course of business.

The
Company had no cash inflows from operating activities for the nine months ended September 30, 2024. As of September 30, 2024, the Company
had minimal cash, restricted cash of $0.2 million, and a working capital deficiency of $32.6 million. The Company’s current operating
plan indicates it will incur losses from operations and generate negative cash flows from operating activities, given anticipated expenditures
related to research and development activities and its lack of revenue generating ability at this point in the Company’s lifecycle.
These events and conditions raise substantial doubt about the Company’s ability to continue as a going concern within one year
after the date these financial statements are issued.

The
Company will need to raise additional funds in order to advance its research and development programs, operate its business, and meet
its current and future obligations as they come due. Based on the Company’s current operational plans and assumptions, which may
not be realized, the Company expects to use the net proceeds from the Backstop Agreement (as defined in Note 3, Business Combination
and Backstop Agreement) and future debt and equity financings, including possibly under the Common Stock Purchase Agreement (as defined
in Note 3, Business Combination and Backstop Agreement) and the SPA entered into