Company: OCEA
Filing Date: 2025-01-13
Form Type: 10-Q
Source: 0001493152-25-001880
Chunk: 191

Company: Ocean Biomedical, Inc.
Filing Date: 2025-01-13
Form: 10-Q
Item: Item 8
Chunk 191
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 our significant subsidiaries). Upon the occurrence of certain events, the Notes will be payable in monthly installments.
A noteholder may, at its election, defer the payment of all or any portion of the installment amount due on any installment date to another
installment payment date.

All
or any portion of the principal amount of each Note, plus accrued and unpaid interest is convertible at any time, in whole or in part,
at the noteholder’s option, into shares of our common stock at an initial fixed conversion price of $10.34 per share, subject to
certain adjustments and alternative conditions. A noteholder will not have the right to convert any portion of a Note, to the extent
that, after giving effect to such conversion, the noteholder (together with certain of its affiliates and other related parties) would
beneficially own in excess of 9.99% of the shares of our common stock outstanding immediately after giving effect to such conversion.
Upon a change of control, noteholders may require us to redeem all, or any portion, of the Notes at a price stipulated by certain conditions
as discussed within the SPA.

The
Notes provide for certain events of default, including, among other things, any breach of the covenants described in the SPA and any
failure of Dr. Chirinjeev Kathuria to be the chairman of our Board of Directors. In connection with an event of default, the noteholders
may require us to redeem all or any portion of the Notes, at a premium set forth in the SPA.

We
are subject to certain customary affirmative and negative covenants regarding the rank of the Notes, the incurrence of indebtedness,
the existence of liens, the repayment of indebtedness and the making of investments, the payment of cash in respect of dividends, distributions
or redemptions, the transfer of assets, the maturity of other indebtedness, and transactions with affiliates, among other customary matters.
We are also subject to financial covenants requiring that (i) the amount of our available cash equal or exceed $3.0 million at the time
of each Additional Closing; (ii) the ratio of (a) the outstanding principal amount of the Notes, accrued and unpaid interest thereon
and accrued and unpaid late charges to (b) our average market capitalization over the prior ten trading days, not exceed 35%; and (iii)
at any time any Notes remain outstanding, with respect to any given