Company: OCEA
Filing Date: 2025-04-08
Form Type: 10-K
Source: 0001641172-25-003155
Chunk: 1290

Company: Ocean Biomedical, Inc.
Filing Date: 2025-04-08
Form: 10-K
Item: Item 9B
Chunk 1290
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arrant at each reporting period and records any changes to fair value to other income (expense) on the consolidated
statement of operations. To date, there have been no changes to the classification of the SPA Warrant.

In
addition to the liabilities recorded for the 2023 Convertible Note and the SPA Warrant, the Company also recorded a liability for
the Ayrton Note Purchase Option, which gives the Investor, at its option through 2025, the right to purchase from the Company
additional Notes (up to the sum of the aggregate principal amount) at one or more Additional Closings. The initial recognition of
this liability was measured at fair value utilizing the Black-Scholes Merton model and the fair value of $0.3
million was recorded to other income (expense) on the consolidated statements of operations for the fiscal year ended December 31,
2023. The liability is remeasured at each reporting period and the Company records any changes to other income (expense) on the
consolidated statement of operations. As of December 31, 2024 and 2023, it was determined that the fair value of the Ayrton Note
Purchase Option was zero.

    F-24

The
Company issued 39,650 shares of its common stock to the Investor during the fiscal year ended December 31, 2023 as interest payments.
A total of $0.2 million was recorded as fair value of non-cash stock issuances on the consolidated statement of operations or the shares
issued based on the grant date fair values.

Between
March 4, 2024 and March 8, 2024, the holder of the Company’s 2023 Convertible Note sent Alternate Conversion Notices to the Company
to convert the principal value and accrued and unpaid interest into shares of the Company’s common stock pursuant to the Alternate
Conversion Price mechanism in the 2023 Convertible Note. The Company is currently evaluating the situation and working with the noteholder
to arrive at an equitable resolution.

Effective
July 23, 2024, the Company entered into an amendment and exchange agreement, whereby the 2023 Convertible Notes were exchanged for
new notes and also included further arrangements to fund up to $7.7 million
in additional secured notes (collectively, the “2024 Convertible Notes”). The first two tranches of additional secured
notes of $1.1 million
and $2.7 million
were funded in July