Company: OCEA
Filing Date: 2025-01-13
Form Type: 10-Q
Source: 0001493152-25-001880
Chunk: 114

Company: Ocean Biomedical, Inc.
Filing Date: 2025-01-13
Form: 10-Q
Item: Item 8
Chunk 114
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 is no provision for income taxes
because the Company has incurred operating losses and capitalized certain items for income tax purposes since its inception and maintains
a full valuation allowance against its net deferred tax assets. In the event the Company were to determine that it would be able to realize
some or all its deferred income tax assets in the future, an adjustment to the deferred income tax asset valuation allowance would increase
income in the period such determination was made. The Company accounts for uncertain tax positions in accordance with the provisions
of ASC 740. When uncertain tax positions exist, the Company recognizes the tax benefit of tax positions to the extent that the benefit
would more likely than not be realized assuming examination by the taxing authority. The determination as to whether the tax benefit
will more likely than not be realized is based upon the technical merits of the tax position as well as consideration of the available
facts and circumstances. As of September 30, 2024 and December 31, 2023, the Company had no liability for income tax associated with
uncertain tax positions.

Net
Loss Per Share

Net
loss per share is computed by dividing net loss attributed to common stockholders by the weighted-average number of shares of common
stock outstanding during the period, less shares subject to repurchase, and, if dilutive, the weighted-average number of potential shares
of common stock. For the purposes of the diluted net loss per share calculation, common stock warrants, common stock options outstanding,
and contingently issuable Earnout Shares (as defined in Note 3, Business Combination and Backstop Agreement) are considered to
be potentially dilutive securities for all periods presented, and as a result, diluted net loss per share is the same as basic net loss
per share for those periods.

Fair
Value Measurements

Certain
instruments of the Company are carried at fair value under U.S. GAAP. Fair value is defined as the exchange price that would be received
for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability
in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize
the use of observable inputs and minimize the use of unobservable inputs. Financial assets and liabilities carried at fair value are
to be classified and disclosed in one of the following three levels of the fair value hierarchy, of which the first two are considered
observable and the last is considered unobservable:

    ●
    Level