Company: OCEA
Filing Date: 2025-04-08
Form Type: 10-K
Source: 0001641172-25-003155
Chunk: 1091

Company: Ocean Biomedical, Inc.
Filing Date: 2025-04-08
Form: 10-K
Item: Item 7
Chunk 1091
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 as defined under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and by the Public Company
Accounting Oversight Board (United States) in our internal control over financial reporting, as follows:

    ●
    Management
    does not have adequate staffing in its accounting department and has not yet designed and implemented the appropriate processes and
    internal controls to support accurate and timely financial reporting.

    ●
    During the audit process for December 31, 2024, management identified a
material weakness in the design of the Company’s internal controls related to our review of third-party valuation deliverables regarding
our convertible debt and warrant liability.

We
have begun taking measures, and plan to continue to take measures, to remediate the material weaknesses. These measures include
hiring or engaging additional accounting personnel with familiarity with reporting under U.S. GAAP, including hiring of Jolie Kahn
as our Chief Financial Officer and implementing and adopting additional controls and formal policies, processes and documentation
procedures relating to financial reporting. Due to the control weaknesses outlined above, management has implemented additional
measures to review the key inputs and assumptions used by third-party valuation subject matter specialists. These enhancements aim
to address deficiencies in the fair value calculation of the convertible note and warrant liability. We plan to undertake
recruitment efforts to identify additional accounting personnel, including possible use of third-party service providers.
Remediation costs consist primarily of additional personnel expenses. We may identify additional material weaknesses in the future
or otherwise fail to maintain proper and effective internal controls, which may impair our ability to produce accurate financial
statements on a timely basis.

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However,
the implementation of these measures may not be sufficient to remediate the control deficiencies that may lead to a material weakness
in our internal control over financial reporting or to prevent or avoid potential future material weaknesses. Moreover, our current controls
and any new controls that we develop may become inadequate in the future because of changes in conditions in our business. Furthermore,
we may not have identified all material weaknesses and weaknesses in our disclosure controls and internal control over financial reporting
may be discovered in the future. If we are unable to successfully remediate our existing or any future material weaknesses in our internal
control over financial reporting, or if we identify any additional material weaknesses, the accuracy and timing of our financial reporting
may be adversely affected, we may be unable to maintain compliance with securities law requirements regarding timely filing of periodic
reports in addition to applicable stock exchange listing requirements, investors may