Company: OCEA
Filing Date: 2025-04-08
Form Type: 10-K
Source: 0001641172-25-003155
Chunk: 1084

Company: Ocean Biomedical, Inc.
Filing Date: 2025-04-08
Form: 10-K
Item: Item 7
Chunk 1084
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 and family of our employees
and short-term borrowings. As of December 31, 2024, our restricted cash balance of approximately $0.2 million is held in an escrow account. We do not have any cash equivalents. Cash used in operating activities was used to pay legal and accounting fees. Accounts payable
and accrued expenses of $16.5 million and $17.1 million as of December 31, 2024 and 2023, respectively, were recorded.

ITEM
7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

To
minimize the risk in the future, we intend to maintain our portfolio of cash equivalents in institutional market funds that are composed
of U.S. Treasury and U.S. Treasury-backed repurchase agreements or short-term U.S. Treasury securities. We do not believe that inflation,
interest rate changes, or exchange rate fluctuations had a significant impact on our results of operations for any periods presented
herein.

Critical
Accounting Policies and Significant Judgments and Estimates

Our
consolidated financial statements are prepared in accordance with generally accepted accounting principles in the United States of America,
or U.S. GAAP. The preparation of our consolidated financial statements and related disclosures requires us to make estimates and judgments
that affect the reported amounts of assets, liabilities, costs and expenses. We base our estimates on historical experience, known trends
and events, and various other factors that we believe are reasonable under the circumstances, the results of which form the basis for
making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. We evaluate our
estimates and assumptions on an ongoing basis. Our actual results may differ from these estimates under different assumptions or conditions.
While our significant accounting policies are described in more detail in Note 2 to our audited consolidated financial statements appearing
elsewhere in this 10-K, we believe that the following accounting policies are those most critical to the judgments and estimates used
in the preparation of our consolidated financial statements.

156

Stock
Options to Non-Employee Directors

Under
the Non-employee Director Compensation Policy, upon initial election or appointment to the Board, each new nonemployee director will
be granted under the Incentive Plan a one-time grant of a non-statutory stock option to purchase 75,000 shares of its common stock on
the date of such director’s election or appointment to the Board, issuable under the incentive plan. These will vest in