Company: OCEA
Filing Date: 2025-04-08
Form Type: 10-K
Source: 0001641172-25-003155
Chunk: 987

Company: Ocean Biomedical, Inc.
Filing Date: 2025-04-08
Form: 10-K
Item: Item 6
Chunk 987
---
 (the “Sponsor
Extension Shares”). In addition, pursuant to the terms of an amendment entered into prior to the paydown of the loans, the Company
issued a total of 200,000 shares of its common stock in exchange for extensions of the maturity date.

The
Company recognized a loss on extinguishment of debt of $1.2 million in its consolidated statements of operations for the year
ended December 31, 2023 for the 200,000 shares issued in exchange for extensions of the maturity date, based on the grant date fair value
of the shares issued. In addition, the Company recognized a loss on extinguishment of debt of $13.6 million in its consolidated statements
of operations for the year ended December 31, 2023 for the issuance of the Sponsor Extension Shares, based on the grant date fair
value. Further, the Company recorded interest expense of $50 thousand in its consolidated statements of operations for the year
ended December 31, 2023.

Deferred
Underwriting Commissions

At
Closing, the underwriters for AHAC’s initial public offering (“IPO”) agreed to defer payment of $3.2 million of deferred
underwriting discounts otherwise due to them until November 14, 2023, pursuant to the terms of a promissory note (the “Underwriter
Promissory Note”). The deferred amounts bear interest at 9% per annum and 24% per annum following an event of default under the
promissory note. The Company has a right to pay up to fifty percent (50%) of the principal and interest due on this promissory note using
the common stock of the Company at a price per share of $10.56. The remaining fifty percent (50%) of the principal and interest due on
this promissory note must be paid in cash. As of December 31, 2023 the Company had not repaid the Underwriter Promissory Note and the
outstanding balance of $3.2 million is recorded as a short-term loan in the consolidated financial statements. The Company recorded $0.4
million and $0.3 million of interest expense on the outstanding balance in the Company’s consolidated financial statements for
the fiscal years ended December 31, 2024 and 2023, respectively.

On
March 4, 2024, the Company converted the convertible portion of the Underwriter Promissory Note into 169,582 restricted shares of its
common