Company: OCEA
Filing Date: 2025-05-15
Form Type: 10-Q
Source: 0001641172-25-011080
Chunk: 75

Company: Ocean Biomedical, Inc.
Filing Date: 2025-05-15
Form: 10-Q
Item: Item 1
Chunk 75
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Second Street Loan 2”) to borrow $0.2 million, which was later
amended in January 2023 to borrow an additional $0.2 million. The Second Street Loan 2 accrues interest at the rate of 15% per annum,
with principal and interest due at maturity. In connection with this loan, the Company issued a warrant to purchase 62,500 shares of the
Company’s common stock, with an exercise price of $11.00 per share, exercisable until February 22, 2026. There is no put option
associated with this loan. The Company was originally required to repay the Second Street Loan 2 on the earlier of (i) 5 business days
after the Company’s next financing or (ii) November 18, 2022. The Company recognized an expense of $0.4 million for the warrants
issued based on the estimated fair value of the awards on the date of grant. The accounting treatment for the warrants is discussed within
Note 10, Warrants.

March Second Street Loan

In March 2023, the Company entered
into a new loan agreement with Second Street Capital (the “March Second Street Loan” and together with the Second Street Loan
and Second Street Loan 2, the “Second Street Loans”) pursuant to which the Company could borrow up to $1.0 million to pay
certain accrued expenses. Of this amount, the Company borrowed $0.7 million. The loan bears interest at 15% per annum. The Company issued
a warrant to Second Street Capital for 200,000 shares of the Company’s common stock, exercisable for five years at an exercise price
of $10.34 and will pay up to $0.2 million in loan fees at maturity. Since the Company only borrowed $0.7 million, the loan fee of $0.1
million is due at maturity. The accounting treatment for the warrants is discussed within Note 10, Warrants.

Second Street Capital Loan Amendments

In connection with amendments
to the Second Street Loans, an additional 225,000 and 75,000 warrants to purchase the Company’s common stock were issued to Second
Street Capital in 2023 and 2022, respectively. The terms of the warrants and respective accounting treatments are summarized in Note 10,
Warrants.

The most recent amendment, effective
as of May 2023, included the following terms, with no conditions present as of March 31, 202