Legal and Regulatory Matters - The company received an arbitral award of $37.1 million from Mexico for breaching obligations under NAFTA, plus interest from October 12, 2018 [148]. - The company is appealing the cancellation of ExO's mining concessions by the Mexican mining authority [149]. - The company has invested up to $10 million in funding for NAFTA arbitration costs related to the ExO project [147]. Mining and Exploration Projects - The company holds an 85.6% interest in Bismarck Mining Corporation, which has an exploration license for the Lihir Gold Project in Papua New Guinea [161]. - The ExO Phosphate Project is located 70-90 meters deep in Mexico's Exclusive Economic Zone and contains high-grade phosphate ore [141]. - The company has a joint venture with Capital Latinoamericano to develop a strategic fertilizer production project in Mexico [150]. - The company plans to conduct further exploration activities in the Lihir Gold Project area, having collected 127 geological samples and conducted seven ROV dives in 2023 [165]. - The company has secured a five-year exploration license for the Ocean Minerals project, with ongoing efforts to validate polymetallic nodule resources [157]. - The company has developed an environmentally sustainable plan for the ExO Phosphate Project, ensuring minimal impact on marine ecosystems [143]. Financial Performance - Total revenue for Q1 2025 was $0.135 million, a decrease of 33.5% compared to $0.203 million in Q1 2024 [174]. - Net loss for Q1 2025 was $0.416 million, a decline of 145.2% compared to a net income of $0.921 million in Q1 2024 [174]. - The consolidated cash balance at March 31, 2025 was $2.5 million, down from $4.8 million at December 31, 2024 [189]. - The company reported a working capital deficit of $20.0 million as of March 31, 2025 [171]. - Total loans payable as of March 31, 2025 amounted to $25.4 million, an increase from $24.9 million at December 31, 2024 [190]. - Cash used in operating activities for Q1 2025 was $1.955 million, compared to $1.669 million in Q1 2024 [183]. Financing and Capital Management - The company plans to generate new cash inflows through monetization of equity stakes in seabed mineral companies and other financing opportunities [169]. - The company amended its March 2023 Notes to extend the maturity date and added a conversion feature, deferring a material cash need [170]. - The company expects sufficient operating funds through at least Q4 2025 from the proceeds of a recent stock sale and anticipated cash inflows [170]. - The Company amended the March 2023 Note and Warrant Purchase Agreement to include a minimum liquidity requirement and modify existing covenants [194]. - The maturity date of the March 2023 AR Notes was extended to December 31, 2025, with a conversion feature allowing holders to convert at a rate of 75% of the 30-day volume weighted average price, capped between $1.10 and $2.20 [195]. - The exercise price of the March 2023 Warrants was reduced from $3.78 to $1.10, and registration rights were granted to holders of the March 2023 AR Notes and Warrants [196]. - The fair value of the March 2023 Warrants decreased by $1.0 million for the three months ended March 31, 2025, compared to a decrease of $2.5 million for the same period in 2024 [197]. - The carrying value of the debt was $12.3 million as of March 31, 2025, which includes $0.4 million of Paid In Kind interest and is net of unamortized debt fees and discounts [199]. - The total face value of the March 2023 debt obligation was $13.5 million as of March 31, 2025, with a current interest rate of 11.0% [199]. - The Company issued December 2023 Notes totaling up to $6.0 million and associated warrants to institutional investors [203]. - The carrying value of the December 2023 debt was $6.3 million as of March 31, 2025, net of unamortized debt fees and discounts [207]. - The fair value of the December 2023 Warrants decreased by $0.4 million for the three months ended March 31, 2025 [205]. - The Company does not believe it has material market risk exposure and has not entered into market risk sensitive instruments [212].

Legal and Regulatory Matters - The Company received an arbitral award of $37.1 million from Mexico for breaching obligations under NAFTA, plus interest from October 12, 2018[161] - The Company is challenging the unlawful cancellation of ExO's mining concessions by the Mexican mining authority[162] - The Funder has provided a total of $24.8 million in Claims Payments as of December 31, 2024, under the Third Amended and Restated International Claims Enforcement Agreement[262] - The Funder agreed to provide up to $2.2 million in Arbitration Support Funds for litigation support costs related to the Subject Claim[259] - The Company incurred $0.2 million in related fees for the Arbitration Support Funds, treated as an additional advance[257] Financial Performance - Total revenue for the year ended December 31, 2024 was $0.769 million, a decrease of 4% compared to $0.804 million in 2023[189] - Net income for the year ended December 31, 2024 was $6.247 million, a significant improvement from a net loss of $3.885 million in 2023[189] - Total other income increased by 182.8% to $18.252 million in 2024 from $6.453 million in 2023[189] - The consolidated cash balance at December 31, 2024 was $4.8 million, up from $4.0 million at the end of 2023[207] - Cash flows provided by operating activities for 2024 were $0.642 million, a turnaround from cash used of $10.170 million in 2023[198] Expenses and Liabilities - Marketing, general and administrative expenses increased by 41.3% to $9.669 million in 2024 from $6.843 million in 2023[189] - The company had a working capital deficit of $16.7 million as of December 31, 2024[187] - Total loans payable decreased from $27.4 million in 2023 to $22.9 million in 2024, with long-term loans payable increasing from $7.9 million to $9.9 million[211] - Interest expense recorded for the years ended December 31, 2024 and 2023 was $1.8 million and $2.0 million, respectively[220] Equity and Financing - The Company issued 7,377,912 shares of common stock at $0.55 per share, raising approximately $4.1 million in December 2024[186] - The right to purchase an additional 7,220,141 shares at $1.10 per share is classified as an equity instrument, valued at approximately $1.5 million[210] - The December 2023 Note Purchase Agreement raised a total of $6.0 million, with $2.4 million allocated to warrants[228] - The company entered into a Note Purchase Agreement with 37North SPV 11, LLC for a loan of $1.0 million, which was non-interest bearing and matured on July 30, 2023[241] Project Developments - The ExO Phosphate Project is located 70-90 meters deep within Mexico's Exclusive Economic Zone and is expected to provide significant benefits to Mexico's agricultural development[154] - The Company and Capital Latinoamericano formed a joint venture to develop a strategic fertilizer production project in Mexico, with equal investment from both parties[163] - The Lihir Gold Project exploration license covers a subsea area believed to have commercially viable gold content, with an 85.6% interest held by the Company[177] - The offshore survey and mapping operations for the Lihir Gold Project were completed in 2022, producing a high-resolution acoustic terrain model of the seafloor[180] Debt and Interest Management - The March 2023 Note has a principal amount of up to $14.0 million, with a debt discount of $3.7 million amortized over its term[214] - The total face value of the March 2023 Note obligation was $13.1 million as of December 31, 2024[220] - The carrying value of the debt was $5.8 million and $3.7 million as of December 31, 2024 and 2023, respectively, net of unamortized debt fees and discounts[236] - The company evaluated the December 2023 NWPA Amendment and concluded it should be recorded as a debt extinguishment due to the addition of a substantive conversion option[240] Asset Management - The total consolidated book value of assets was approximately $18.5 million at December 31, 2024[187] - The fair value of the obligation increased to $57.0 million as of December 31, 2024, up from $52.1 million in 2023, reflecting a change of $4.8 million[263] - The company has a cost investment with a related party, requiring careful analysis to determine the proper accounting treatment[280] Risk Management and Valuation - The company does not believe it has material market risk exposure and has not engaged in market risk-sensitive instruments for trading or speculative purposes[283] - The fair value of derivative liabilities, including warrants, is estimated using a Black-Scholes model, which is sensitive to inputs like stock volatility and risk-free interest rates[276] - The company has identified critical accounting estimates that could result in materially different financial outcomes under varying assumptions[272]

Revenue Performance - Total revenue for Q3 2024 was $213,901, an increase of 21.6% compared to $175,876 in Q3 2023[29] - Total revenue for the three months ended September 30, 2024 was $0.21 million, an increase of $38,000 (21.6%) compared to $0.18 million for the same period in 2023[199][200] - Total revenue for the nine months ended September 30, 2024 was $0.6 million, a decrease of $4,000 compared to the same period in 2023[210] - Marine services revenue for the nine months ended September 30, 2024, was $590,248, down 6.1% from $628,907 in the same period of 2023[29] - For the three and nine months ended September 30, 2024, two customers accounted for 100% of total revenue, consistent with the previous year where one customer accounted for 100% of total revenue[154] Operating Expenses - Total operating expenses for Q3 2024 were $3,082,064, a 17.1% increase from $2,631,298 in Q3 2023[29] - Total operating expenses increased by $451,000 (17.1%) to $3.08 million for the three months ended September 30, 2024, compared to $2.63 million in 2023[199] - Marketing, general and administrative expenses for the three months ended September 30, 2024 were $1.73 million, an increase of $169,000 (10.8%) compared to $1.56 million in 2023[199][202] - Operations and research expenses increased by $282,000 (26.4%) to $1.35 million for the three months ended September 30, 2024, compared to $1.07 million in 2023[199][203] Net Income - The net income attributable to Odyssey Marine Exploration, Inc. for Q3 2024 was $18,688,236, compared to a net loss of $3,813,285 in Q3 2023[29] - Net income for the three months ended September 30, 2024 was $18.7 million, a significant increase of $22.5 million compared to a net loss of $3.8 million in 2023, reflecting a 590.1% change[199] - Net income for the nine months ended September 30, 2024, was $13,427,676, compared to $6,772,418 for the same period in 2023, representing a significant increase[35] Assets and Liabilities - Total assets decreased to $21,758,228 as of September 30, 2024, from $22,752,297 as of December 31, 2023[25] - Total liabilities decreased to $98,480,151 as of September 30, 2024, from $108,658,831 as of December 31, 2023[25] - Cash and cash equivalents decreased to $2,859,267 as of September 30, 2024, from $4,021,720 as of December 31, 2023[25] - The total loans payable as of September 30, 2024, amounted to $24,269,981, a decrease from $27,378,905 as of December 31, 2023[102] Cash Flow - The company experienced a net cash provided by operating activities of $2,411,075 for the nine months ended September 30, 2024, compared to a net cash used of $(8,741,824) in the same period of 2023[35] - Cash at the end of the period was $2,859,267, a decrease from $4,021,720 at the beginning of the period[35] Shareholder Equity - Basic net income per share for Q3 2024 was $0.90, compared to a loss of $0.19 per share in Q3 2023[29] - Basic earnings per share (EPS) for the three months ended September 30, 2024, was $0.90, while the diluted EPS was $0.13, compared to a basic EPS of $(0.19) and diluted EPS of $(0.19) for the same period in 2023[54] Financial Instruments and Derivatives - The fair value of warrants classified as liabilities decreased by $7,754,438 during the reporting period[33] - The company reported a change in derivatives liability fair value of $(18,471,872) for the nine months ended September 30, 2024[35] - The fair value of the 2022 Warrants decreased to $2.2 million as of September 30, 2024, with a decrease of $10.8 million for the three months ended September 30, 2024[144] Debt and Financing - The aggregate outstanding amount of the Oceanica-ExO Notes, including accrued interest, was approximately $119.3 million as of September 30, 2024, up from $105.0 million as of December 31, 2023[70] - The Company obtained an Economic Injury Disaster Loan (EIDL Loan) of $150,000, with principal balance remaining at $150,000 as of September 30, 2024[116] - The Company owes a vendor $0.5 million as an interest-bearing trade payable at a rate of 12.0% per annum, with no payment demanded despite the agreement maturing in August 2018[117] Investments - As of September 30, 2024, the investment in unconsolidated entities totaled $9,924,954, an increase from $9,001,646 as of December 31, 2023[77] - Odyssey purchased 733,497 membership interest units of Ocean Minerals, LLC for a total purchase price of $15.0 million, representing approximately 15.0% of the issued and outstanding membership interest[80] - The total purchase price for the OML Purchase Agreement was $15.0 million, with the initial closing consideration transferred being $10.3 million[88] Legal and Regulatory Matters - The company received an arbitral award of $37.1 million from Mexico for breaching obligations under NAFTA, which is considered a gain contingency[140] - The company has not recorded any related gain from the arbitration award as of September 30, 2024, pending analysis of collectability[140] Future Outlook - The company plans to generate new cash inflows through monetization of receivables and equity stakes in seabed mineral companies[42] - The exploration program for the Lihir Gold Project is ongoing, with a focus on validating and quantifying precious and base metal content, supported by a permit extension issued in November 2023[193] - The Company was notified by Nasdaq that it did not meet the minimum $35.0 million market value requirement for 30 consecutive business days, with a compliance period ending April 28, 2025[164]

Financial Performance - Total revenue for Q2 2024 was $215,565, an increase of 24.9% compared to $172,575 in Q2 2023[24]. - Marine services revenue increased to $179,821 in Q2 2024 from $166,832 in Q2 2023, reflecting a growth of 7.1%[24]. - The net loss attributable to Odyssey Marine Exploration, Inc. for Q2 2024 was $(1,527,103), compared to a net loss of $(4,931,609) in Q2 2023, showing an improvement of 69%[24]. - The company reported a loss from operations of $(3,016,002) in Q2 2024, compared to $(2,847,589) in Q2 2023[24]. - As of June 30, 2024, the company reported a net loss of $3.73 million, compared to a net loss of $7.25 million for the same period in 2023[25]. - The company generated net cash provided by operating activities of $3.97 million for the six months ended June 30, 2024, contrasting with a cash outflow of $7.57 million for the same period in 2023[28]. - The Company reported a basic net loss of $1,527,103 for the three months ended June 30, 2024, compared to a loss of $4,931,609 for the same period in 2023, indicating a significant improvement[44]. - Net loss for Q2 2024 was $1.53 million, a decrease of $3.41 million (69.0%) from a net loss of $4.93 million in Q2 2023[140]. - Net income for the six months ended June 30, 2024 was $1.97 million, a decrease of $15.41 million (88.7%) from $17.38 million in the same period of 2023[147]. Assets and Liabilities - Total assets increased to $26,282,002 as of June 30, 2024, up from $22,752,297 as of December 31, 2023, marking a growth of 15%[22]. - Current liabilities rose to $37,790,254 as of June 30, 2024, compared to $31,465,728 at the end of 2023, an increase of 20.1%[22]. - Total liabilities increased to $120,199,491 as of June 30, 2024, up from $108,658,831 at the end of 2023, reflecting an increase of 10.5%[22]. - The company has a total stockholders' deficit of $(93,917,489) as of June 30, 2024, compared to $(85,906,534) at the end of 2023[22]. - The total consolidated book value of assets was approximately $26.3 million at June 30, 2024, with a working capital deficit of $29.7 million[34]. - The total loans payable as of June 30, 2024, amounted to $27,916,977, with a net total of $25,938,628 after accounting for unamortized deferred fees and discounts[78]. - The total fair valued liabilities increased to $82,975,903 as of June 30, 2024, from $74,247,485 at December 31, 2023[99]. Cash Flow and Liquidity - The cash balance at the end of the period was $7.58 million, compared to $1.83 million at the end of June 2023, indicating a significant increase in liquidity[28]. - Cash at the end of the period on June 30, 2024, was $7.6 million, an increase of $3.6 million from $4.0 million at December 31, 2023[158]. - Cash flows used in investing activities for the six months ended June 30, 2024, were minimal at $(84,000), compared to $144,000 in 2023[156]. - Cash flows used in financing activities for the six months ended June 30, 2024, were $0.3 million, primarily for debt obligation payments, compared to $7.8 million provided in 2023[157]. Expenses - Operating expenses for Q2 2024 were $3,231,567, up from $3,020,164 in Q2 2023, representing an increase of 7%[24]. - Marketing, general and administrative expenses for Q2 2024 were $2.2 million, an increase of $0.4 million (21.9%) from $1.8 million in Q2 2023[142]. - Total operating expenses for Q2 2024 were $3.2 million, an increase of $0.2 million (7.0%) compared to $3.0 million in Q2 2023[140]. - Share-based compensation for the six months ended June 30, 2024, amounted to $1.56 million, compared to $0.37 million in the same period of 2023[28]. - Share-based compensation expense for the three months ended June 30, 2024, was $0.1 million, compared to $0.3 million for the same period in 2023, while for the six months, it was $1.6 million versus $0.4 million[111]. Investments and Acquisitions - The total purchase price for the 733,497 membership interest units of Ocean Minerals, LLC was $15.0 million, representing approximately 15.0% of the issued and outstanding membership interest[62]. - The initial closing consideration transferred for the OML Purchase Agreement was $10.3 million, including cash and shares of ORI[67]. - The company has the option to purchase up to an additional 1,466,993 OML Interest Units at $20.45 per unit within eighteen months from the Initial Closing Date[67]. - The company assessed its investment in CIC Limited for impairment annually, recording a loss if deemed other than temporary[61]. Risk and Compliance - The fair market value of the company's assets may differ from their net carrying book value, raising concerns about its ability to continue as a going concern[34]. - Management identified material weaknesses in internal control over financial reporting, which are currently being remediated[183]. - The company has engaged an Interim Controller and accounting advisory consultants to strengthen internal controls and financial reporting[184]. - The company is pursuing a claim under NAFTA against Mexico for over $2 billion due to wrongful denial of environmental permits for the ExO Phosphate Project, which has been challenged in court[125]. Shareholder Information - FourWorld Capital Management LLC beneficially owns approximately 20.0% of the company's Common Stock as of July 31, 2024[55]. - Two Seas Capital LP owns approximately 9.99% of the company's Common Stock after accounting for the beneficial ownership limitation applicable to warrants[55]. - Greywolf Distressed Opportunities Master Fund, L.P. beneficially owns approximately 9.2% of the company's Common Stock as of July 31, 2024[55].

Project Developments - The ExO Phosphate Project in Mexico has a significant deposit of high-grade phosphate ore, which can be extracted on a financially attractive basis, benefiting both local agriculture and global fertilizer markets [185]. - Odyssey holds a 56.04% interest in Oceanica, which owns 99.99% of ExO, and ExO has a 50-year mining license granted by Mexico, extendable for another 50 years [186]. - The CIC Project, awarded a five-year exploration license in February 2022, has shown positive early sampling results, indicating viable operational functions for future development [199]. - The Ocean Minerals, LLC Project has validated vast polymetallic nodule resources and is advancing recovery systems for commercial operations [203]. - Odyssey entered into a purchase agreement to acquire approximately 13% interest in OML, with the potential to increase this to 40% within 18 months [204]. - The Lihir Gold Project has received a permit extension from Papua New Guinea, allowing continued exploration of commercially viable gold content [209]. - A comprehensive project plan for the Lihir Gold Project has been developed, focusing on environmental surveys and studies to support future mining license applications [211]. - The exploration phase of the Lihir Gold Project will validate and quantify precious and base metal content, with further development dependent on resource characterization [212]. Financial Performance - Total revenue for Q1 2024 decreased by $86,000 to $203,000, a decline of 29.7% compared to $289,000 in Q1 2023 [225]. - Marketing, general and administrative expenses increased by $2.2 million to approximately $4.0 million, a rise of 122.2% from $1.8 million in Q1 2023 [227]. - Operations and research expenses decreased by $399,000 to $886,000, a decline of 31.1% compared to $1.3 million in Q1 2023 [228]. - Total other income decreased by $17.2 million, with net other income of $5.7 million in Q1 2024 compared to $22.9 million in Q1 2023 [229]. - Net cash used in operating activities for Q1 2024 was $1.6 million, a decrease of approximately $2.4 million compared to $3.0 million in Q1 2023 [233]. - Cash and cash equivalents at March 31, 2024, were $2.1 million, a decrease of $1.9 million from $4.0 million at December 31, 2023 [237]. - The company reported a net loss attributable to Odyssey Marine Exploration, Inc. of $3.5 million in Q1 2024, down from a net income of $22.3 million in Q1 2023, representing an 84.3% decline [225]. - The non-controlling interest adjustment for Q1 2024 was $2.6 million, compared to $2.2 million in Q1 2023, primarily due to increased operating costs [231]. Debt and Financing - Financial debt increased to $24.7 million at March 31, 2024, up from $23.34 million at December 31, 2023 [237]. - Total loans payable as of March 31, 2024, amounted to $27,741,436, an increase from $27,378,905 as of December 31, 2023, with long-term loans payable at $8,415,218 [239]. - The March 2023 Note has a principal amount of $15,270,792, bearing an interest rate of 11.0% per annum, with interest payable in cash quarterly or as PIK Interest [242]. - The fair value of the March 2023 Warrant at March 31, 2024, was $5,263,018, reflecting a change in valuation due to its classification as a derivative liability [244]. - The December 2023 Notes issued totaled $3.75 million and $2.25 million, with an interest rate of 11.0% per annum, and the first interest payment will be satisfied with PIK Interest [255]. - As of March 31, 2024, the carrying value of the debt was $14,162,450, including PIK Interest of $1,270,792 and net of unamortized debt fees of $28,425 [246]. - The Company recognized $618,067 in interest expense from the amortization of the debt discount for the three months ended March 31, 2024 [246]. - The Company entered into a Note Purchase Agreement with 37N for $1,000,000, which was non-interest bearing and matured on July 30, 2023 [247]. - 37N exercised its right to convert $360,003 of the outstanding indebtedness into 155,000 shares of common stock on December 29, 2023 [251]. - The total face value of the March 2023 Note was $15,270,792 as of March 31, 2024, compared to $14,858,816 as of December 31, 2023 [246]. - The proceeds from the December 2023 Note Purchase Agreement are intended for working capital and general corporate expenditures [257]. - The December 2023 Warrants allow holders to purchase up to 1,411,765 shares at an exercise price of $4.25 per share, representing 120.0% of the closing price prior to the agreement [258]. - The total proceeds from the December 2023 Note Purchase Agreement amounted to $6.0 million, with $3.75 million issued on December 1, 2023, and $2.25 million on December 28, 2023 [265]. - As of March 31, 2024, the carrying value of the debt was $4,125,947, net of unamortized debt fees of $50,918 and a debt discount of $1,860,882 [262]. - The consolidated non-restricted cash balance at March 31, 2024, was $2.1 million, with a working capital deficit of $30.1 million [266]. - The fair value of the December 2023 Warrants was initially recognized at $2,392,563, impacting the allocation of proceeds between debt and warrant liability [261]. - The current interest rate on the December 2023 Notes is 11.0% [262]. - The company has experienced several years of net losses, raising substantial doubt about its ability to continue as a going concern [263][266]. - The company plans to generate new cash inflows through monetization of receivables and equity stakes in seabed mineral companies [264]. - The December 2023 Warrants include a cashless exercise option if dividends are announced [258]. - The company does not engage in off-balance sheet financing arrangements [267].

Project Development and Exploration - Odyssey Marine Exploration has a diversified mineral portfolio, including projects where it holds a majority stake and others where it is a minority owner, focusing on environmentally responsible development [22]. - The ExO Phosphate Project in Mexico contains high-grade phosphate ore, with a mining license granted for 50 years, extendable for another 50 years, and is expected to provide significant benefits to Mexico's agricultural sector [35][37]. - Odyssey is seeking over $2 billion in compensation from Mexico under NAFTA due to unlawful permit denials for the ExO project, claiming that these actions have destroyed the value of its investment [42]. - The CIC Project, awarded a five-year exploration license in June 2022, has resulted in positive early sampling and operational data, with Odyssey holding approximately 14.99% equity in CIC [46][47]. - Odyssey has entered into a purchase agreement to acquire up to 40% interest in Ocean Minerals, LLC, contributing cash and a 6,000-meter ROV, with an initial closing completed in July 2023 [51]. - The Ocean Minerals project aims to develop recovery systems for high-quality polymetallic nodules, with ongoing exploration to secure environmental approvals for commercial operations [50]. - The Lihir Gold Project exploration license covers a subsea area with prospective gold targets, with an 85.6% interest in Bismarck Mining Corporation, Ltd [54]. - Previous exploration expeditions indicate the area is highly prospective for commercially viable gold content [55]. - In November 2023, a permit extension was issued to continue the exploration program, which began in late 2021 and is ongoing [56]. - Offshore survey and mapping operations produced a high-resolution acoustic terrain model of the seafloor, completed in 2022 [57]. - A comprehensive project plan was designed in the first half of 2023 to identify specific target areas for geological and environmental samples [57]. - The multi-year exploration program will focus on environmental surveys and studies to comply with Papua New Guinea's requirements [58]. - The Don Diego Phosphorite Project is located in the Mexican Exclusive Economic Zone, covering approximately 114,775 hectares of seafloor at a water depth of about 80 meters [136]. - The company holds a 56.04% interest in the Don Diego Phosphorite Project, which currently has no reportable mineral reserves [136]. - The primary concession for the project was granted in 2012, with additional adjacent concessions acquired in 2014 [136]. - The project requires approval of its Environmental and Social Impact Assessment from the Mexican Ministry of Environment and Natural Resources to commence further operations [139]. - The company is exposed to significant governmental regulations affecting operations, including the need for various licenses and permits [116]. Financial Performance and Reporting - The company reported a net income of $1.5 million in 2023, primarily due to a gain recognized on debt extinguishment, following a net loss of $23.1 million in 2022 [101]. - The company has experienced net losses in every fiscal year since inception, except for 2023 and 2004 [101]. - Total revenue for the year ended December 31, 2023 was $804,000, a decrease of $531,000 (39.8%) compared to $1.3 million in 2022 [158]. - Total operating expenses decreased by $8.0 million (41.9%) to $11.1 million in 2023 from $19.2 million in 2022 [157]. - Marketing, general and administrative expenses decreased by $2.6 million (27.4%) to $6.8 million in 2023 compared to $9.4 million in 2022 [159]. - Operations and research expenses decreased by $5.5 million (56.0%) to $4.3 million in 2023 from $9.8 million in 2022 [160]. - Total other income was $6.5 million in 2023, a change of $18.4 million from a net expense of $12.0 million in 2022 [161]. - Net cash used in operating activities for 2023 was $10.2 million, consistent with the $10.2 million used in 2022 [165]. - Cash flows provided by financing activities for 2023 were $13.8 million, including $21.4 million from loans payable issuance [169]. - The ending cash and cash equivalents increased to $4.0 million in 2023 from $1.4 million in 2022 [164]. - The non-controlling interest adjustment for 2023 was $9.2 million, up from $7.7 million in 2022 [163]. - The company did not declare any dividends in 2023 and none are anticipated in the foreseeable future [152]. - Total loans payable increased to $27.4 million as of December 31, 2023, up from $22.4 million at the end of 2022 [173]. - The company has a total debt obligation of $23.3 million as of December 31, 2023, compared to $22.4 million at the end of 2022 [171]. Internal Controls and Compliance - The company has identified material weaknesses in internal controls over financial reporting as of December 31, 2023, due to a restatement of financial information [82]. - The restatement has led to additional risks, including potential litigation and reputational issues for the company [83]. - The company aims to enhance gender and racial/ethnic diversity in management, with 50% of current employees being female [74]. - The company has identified material weaknesses in its internal control over financial reporting, which could adversely affect the accuracy and timing of financial reporting [87]. - As of December 31, 2023, the company's internal control over financial reporting was deemed ineffective due to existing material weaknesses [87]. - The company has initiated remediation measures for identified internal control weaknesses but cannot assure their adequacy for future effectiveness [87]. - The company may incur additional expenses and management time on compliance-related issues as it continues its control remediation activities [87]. Cybersecurity - Cybersecurity risks are a concern, with the company employing a comprehensive strategy for risk assessment and management [122]. - The company has not experienced material effects from cybersecurity threats due to proactive measures and advanced threat detection capabilities [130]. - The company’s cybersecurity governance includes regular updates to the board of directors on risks and incidents [132]. - The company’s incident response plan outlines roles, responsibilities, and communication strategies in the event of a cybersecurity incident [126]. Capital and Financing - The company expects the ICSID Tribunal to issue its Award in the first quarter of 2024 regarding the arbitration claim against Mexico [172]. - Odyssey issued a promissory note with a principal amount of up to $14.0 million, of which $13.1 million was advanced in March 2023 [184]. - The interest rate on the March 2023 Note is 11.0% per annum, with the first quarterly interest payment satisfied with PIK Interest [185]. - As of December 31, 2023, the carrying value of the debt was $13,116,138, net of unamortized debt fees and discounts [189]. - Odyssey entered into a Note Purchase Agreement with 37North SPV 11, LLC for a loan of $1,000,000, which was non-interest bearing and matured on July 30, 2023 [190]. - On December 1, 2023, Odyssey issued promissory notes totaling $3.75 million and additional notes of $2.25 million on December 28, 2023 [199]. - The December 2023 Notes also bear an interest rate of 11.0% per annum, with the first interest payment to be satisfied with PIK Interest [200]. - The first tranche of December 2023 Warrants allows the purchase of up to 1,411,765 shares at an exercise price of $4.25 per share [201]. - The second tranche of December 2023 Warrants allows the purchase of up to 211,565 shares at an exercise price of $7.09 per share [201]. - The total face value of the March 2023 Note obligation at December 31, 2023, was $14,858,816 [189]. - Odyssey's obligations under the December 2023 Notes are secured by a pledge of equity interests in Odyssey Marine Cayman Limited [200]. - The company entered into a Termination Agreement with Monaco, issuing 984,848 shares at $6.60 per share, totaling $6.5 million, and paying $3.0 million in cash, with $500,000 paid upon execution [205]. - A gain on debt settlement of approximately $5.2 million was recognized in Q4 2021, representing the difference between forgiven debt of approximately $14.7 million and total consideration of approximately $9.5 million [206]. - The company paid the remaining $2.5 million under the Termination Agreement on June 14, 2022 [208]. - The Litigation Financing Agreement allows for a maximum investment of $6.5 million, divided into two phases: $1.5 million for antecedent costs and $5.0 million for pursuing the claim [210][211]. - The Claimholder can request Tranche A funding of up to $3.5 million and Tranche B funding of up to $1.5 million, with specific conditions for each tranche [212]. - If the Claimholder ceases the Subject Claim, the Claims Payments convert to a senior secured liability with an annualized internal rate of return (IRR) of 50% [215]. - The Funder has the right to receive 100% of the Proceeds until the total Claims Payments are repaid, with additional compensation based on specified percentages of the investment amounts [220].

Project Developments - The ExO Phosphate Project in Mexico contains a significant deposit of high-grade phosphate rock, with extraction being financially attractive due to its location 70-90 meters deep [124]. - Odyssey is seeking over $2 billion in compensation from Mexico due to repeated unlawful permit denials for the ExO project, which has significantly impacted the company's investment value [129]. - The CIC Project received a five-year exploration license from the Cook Islands Seabed Minerals Authority, with offshore explorations yielding positive early results [134]. - Odyssey holds approximately 14.67% of CIC's outstanding equity units and can earn up to 20 million equity units over the next several years, representing a potential 16% interest [136]. - The Ocean Minerals LLC Project involves a purchase agreement for a 13% interest in OML, with cash contributions of up to $10 million planned over the next year [139]. - The Lihir Gold Project in Papua New Guinea has identified at least five prospective gold exploration targets, with ongoing exploration programs to validate and quantify resource content [142]. - Offshore survey operations in the Lihir license area produced a high-resolution acoustic terrain model, aiding in the characterization of the geological setting [145]. - Odyssey's exploration program in Papua New Guinea will focus on environmental surveys and studies to support future mining license applications [146]. - The company has developed an environmentally sustainable plan for the ExO project, ensuring no chemicals are used in the dredging process and that the seabed will be restored post-dredging [126]. Financial Performance - Total revenues for the three months ended June 30, 2023, decreased by $217,000 (55.6%) to $173,000 compared to $390,000 for the same period in 2022 [151]. - Marketing, general and administrative expenses decreased by $471,000 (20.5%) to $1.8 million for the three months ended June 30, 2023, compared to $2.3 million in 2022 [153]. - Operations and research expenses increased by $269,000 (21.9%) to $1.5 million for the three months ended June 30, 2023, driven by a $530,000 increase in marine equipment expenses [154]. - Total other expenses increased by $1.5 million (43.5%) to $4.9 million for the three months ended June 30, 2023, primarily due to a $771,000 increase in interest expense [155]. - Net income (loss) for the three months ended June 30, 2023, was $(5.7) million, a decrease of $1.0 million (22.2%) compared to $(4.7) million in 2022 [150]. - Total revenues for the six months ended June 30, 2023, decreased by $229,000 (33.0%) to $461,000 compared to $690,000 for the same period in 2022 [160]. - Operations and research expenses decreased by $3.0 million (47.7%) to $3.3 million for the six months ended June 30, 2023, primarily due to a $4.6 million decrease in litigation finance costs [162]. - Total other income increased by $19.7 million, resulting in net income of $12.8 million for the six months ended June 30, 2023, compared to a net expense of $6.8 million in 2022 [163]. Cash and Debt Management - Cash and cash equivalents at June 30, 2023, were $1.8 million, an increase of $0.4 million from $1.4 million at December 31, 2022 [169]. - Financial debt decreased to $36.8 million at June 30, 2023, from $46.7 million at December 31, 2022 [169]. - The total carrying value of the Company's consolidated notes payable as of June 30, 2023, was $40,925,145, compared to $46,743,700 as of December 31, 2022 [172]. - For the three months ended June 30, 2023, the Company recorded $86,130 in interest expense from the amortization of the debt discount, compared to $72,013 for the same period in 2022 [175]. - The Company entered into a Note and Warrant Purchase Agreement in March 2023, issuing a promissory note with a principal amount of up to $14.0 million, of which $13.1 million was advanced in March 2023 [176]. - The principal amount outstanding under the DP SPV Note bears interest at 11.0% per annum, with the first quarterly interest payment being satisfied with PIK Interest [177]. - The total face value of the obligation under the DP SPV Note as of June 30, 2023, was $13,652,646, net of unamortized debt fees and discounts [183]. - The Company entered into a Note Purchase Agreement with 37North SPV 11, LLC for $1.0 million, with the proceeds received in full on June 29, 2023 [184]. - The Company recorded $750,871 of interest expense from the amortization of the debt discount for the six months ended June 30, 2023 [183]. - The total proceeds from the Note and Warrant Purchase Agreement were allocated between debt and equity, resulting in a debt discount of $3,536,154 [182]. Going Concern and Financial Risks - As of June 30, 2023, the consolidated non-restricted cash balance was $1.8 million, with a working capital deficit of $35.7 million [191]. - The total consolidated book value of assets was approximately $14.0 million, which includes the cash balance [191]. - The company has raised substantial doubt about its ability to continue as a going concern due to financial conditions [191]. - The company does not engage in off-balance sheet financing arrangements and has no interest in limited purpose entities [196]. - There is no material market risk exposure, and the company has not entered into market risk sensitive instruments [197]. - The company currently has no debt obligations with variable interest rates [198].

Financial Performance - Total revenues for Q1 2023 were $289,000, a decrease of 3.7% compared to $300,000 in Q1 2022[130]. - Total operating expenses decreased by 47.4% to $3,666,000 in Q1 2023 from $6,975,000 in Q1 2022[130]. - Net income for Q1 2023 was $16,601,000, representing a significant increase of 301.7% compared to a net loss of $8,230,000 in Q1 2022[130]. - Total revenue for the three months ended March 31, 2023, was $289 thousand, consistent with the same period in 2022[131]. - Operating expenses for the three months ended March 31, 2023, were $1.9 million, unchanged from the same period in 2022[132]. - Total other income and expense resulted in a net income increase of $21.2 million, attributed to a $21.5 million gain on the extinguishment of the Minosa Notes[135]. Expenses and Income - Operations and research expenses dropped by 64.6% to $1,788,000 in Q1 2023 from $5,057,000 in Q1 2022[130]. - Operations and research expenses decreased by $3.3 million for the three months ended March 31, 2023, primarily due to a $4.3 million decrease in litigation financed costs[134]. - Total other income increased dramatically to $17,736,000 in Q1 2023 from an expense of $3,416,000 in Q1 2022, marking a 619.2% change[130]. - Net cash used in operating activities for the three months ended March 31, 2023, was $3.5 million, an increase of approximately $1.8 million compared to the same period in 2022[139]. Cash and Debt Management - Cash and cash equivalents at March 31, 2023, were $674 thousand, a decrease of $769 thousand from December 31, 2022[142]. - Financial debt of the company was $36.1 million at March 31, 2023, down from $46.7 million at December 31, 2022[142]. - The company issued a promissory note in the principal amount of $13.1 million as part of a Note and Warrant Purchase Agreement on March 6, 2023[149]. - The principal amount outstanding under the DP SPV Note bears interest at 11.0% per annum, with the first quarterly interest payment due to be satisfied with PIK Interest[150]. - As of March 31, 2023, the carrying value of the debt was $9,798,236, net of unamortized debt fees and discounts, with a total face value of $13,100,000[155]. Non-controlling Interest - Non-controlling interest increased by 20.1% to $2,235,000 in Q1 2023 from $1,861,000 in Q1 2022[130]. - The non-controlling interest adjustment for the three months ended March 31, 2023, was $2.2 million, compared to $1.9 million for the same period in 2022[137]. Business Strategy and Concerns - Odyssey has the right to issue up to 3,465,778 shares at an exercise price of $3.78, which is 120.0% of the closing price prior to the Purchase Agreement[151]. - Odyssey reported a working capital deficit of $32.6 million and a consolidated cash balance of $674,000 as of March 31, 2023[158]. - The company has experienced several years of net losses, raising substantial doubt about its ability to continue as a going concern[156]. - Odyssey's 2023 business plan relies on generating new cash inflows through monetization of receivables and equity stakes in seabed mineral companies[157]. - The company entered into a $3.0 million sale/leaseback arrangement for marine equipment to improve liquidity[157]. Project Developments - The ExO Phosphate Project is expected to provide significant benefits to Mexico's agricultural development, with a large amount of high-grade phosphate rock available for extraction[106]. - The South American Phosphate Project will cover 366 square kilometers of seabed, with potential high-grade phosphate deposits similar to the ExO project, which has an estimated 588 million tonnes of resource[119][121]. - The Lihir Gold Project exploration license covers a subsea area with at least five prospective gold exploration targets, adjacent to one of the world's largest terrestrial gold deposits[122]. - Odyssey has filed a NAFTA claim seeking over $2 billion in compensation due to the unlawful denial of environmental permits for the ExO project[111]. Accounting and Compliance - The company adopted ASU No. 2020-06 effective January 1, 2022, affecting the accounting for convertible instruments[161]. - Odyssey's total consolidated book value of assets was approximately $13.2 million as of March 31, 2023[158]. - The company incurred $98,504 in related fees, amortized over the term of the Purchase Agreement, and recorded a debt discount of $3,416,594[154]. - Odyssey has no off-balance sheet financing arrangements and does not engage in market risk-sensitive instruments[163][164].

Financial Performance - Total revenue for 2022 was $1.3 million, an increase of $0.4 million or 45.0% compared to $0.9 million in 2021[128] - Net income loss for 2022 was $23.1 million, a decrease of $13.2 million or 132.4% compared to a loss of $10.0 million in 2021[128] - Total other expenses increased to $13.8 million in 2022, up $12.6 million or 1075.8% from $1.2 million in 2021, primarily due to increased interest expenses[132] - Total operating expenses for 2022 were $18.4 million, an increase of $2.5 million or 15.8% from $15.9 million in 2021[128] - The company has experienced several years of net losses, raising doubt about its ability to continue as a going concern[191] Cash Flow and Liquidity - Cash used in operating activities for 2022 was $9.3 million, an increase of $3.8 million compared to $5.4 million in 2021[138] - Cash flows provided by financing activities in 2022 were $10.8 million, significantly higher than $1.2 million in 2021[142] - Ending cash and cash equivalents decreased to $1.4 million in 2022 from $2.3 million in 2021[144] - The consolidated non-restricted cash balance at December 31, 2022, was $1.4 million, with a working capital deficit of $60.7 million[193] Debt and Financial Obligations - Financial debt increased to $46.7 million at the end of 2022 from $41.9 million at the end of 2021[145] - The total face value of the obligation as of December 31, 2022, was $24,848,406, an increase from $19,266,818 in 2021[190] - As of December 31, 2022, the carrying value of the obligation was $24,347,513, net of unamortized debt fees of $146,897 and a debt discount of $353,996[190] - The company incurred $295,932 in debt discount expense and $146,896 in fee amortization for the year ended December 31, 2022[190] Expenses - Marketing, general and administrative expenses rose to $8.5 million in 2022, up $2.2 million or 34.2% from $6.3 million in 2021[130] - Marketing, general and administrative expenses increased by $2.6 million to $6.3 million for the year ended December 31, 2021, compared to $3.8 million for the year ended December 31, 2020[150] - Operations and research expenses decreased by $1.4 million to $9.6 million for the year ended December 31, 2021, compared to $10.9 million for the year ended December 31, 2020[151] Equity and Investments - The company sold 4,939,515 shares of common stock and warrants in June 2022, generating net proceeds of $14.7 million after offering expenses of $1.8 million[192] - Non-controlling interest increased to $7.7 million in 2022 from $6.2 million in 2021, reflecting compounding interest on intercompany debt[136] Litigation and Funding - Odyssey paid AHMSA $9.0 million as a Termination Payment on March 6, 2023[169] - A portion of the MINOSA Notes was converted into 304,879 shares of Odyssey's common stock[169] - The Maximum Investment Amount for litigation financing is capped at $6.5 million, with $1.5 million allocated for Phase I and $5 million for Phase II[174] - The Funder is entitled to a closing fee of $80,000 for both Phase I and Phase II Investment Amounts[174] - If the Claimholder ceases the Subject Claim, all Claims Payments will convert to a senior secured liability with an annualized IRR of 50%[179] - The Funder has the right to receive 100% of the Proceeds until the cumulative amount equals the total Claims Payments made under Phase I[182] - The Claimholder must exercise options for Tranche A and Tranche B in writing within specified timeframes to receive additional funding[174] - The Funder's rights to the Recovery Percentage will survive any decision by the Claimholder to utilize Self-Funding[181] - The Claimholder acknowledged the Funder's priority right to any Proceeds, including collateral to secure obligations under the Agreement[183] - The Agreement includes customary provisions such as representations, warranties, and indemnification[183] - The Funder provided $2.0 million in Arbitration Support Funds during 2020, with related fees of $200,000 treated as an additional advance[184] Tax and Valuation - The company recorded a valuation allowance of $85.3 million for deferred tax assets as of December 31, 2022, indicating they are unlikely to be realized[198] - As of December 31, 2022, the total consolidated book value of assets was approximately $13.3 million[193]

Financial Performance - Total revenues for Q3 2022 increased by 82% to $358,000 compared to $197,000 in Q3 2021[109] - Total revenues for the nine months ended September 30, 2022 increased by $377 million, or 56%, to $1,048 million compared to $671 million for the same period in 2021[118] - Net loss for Q3 2022 was $5,455,000, a 33.5% increase from the net loss of $4,085,000 in Q3 2021[109] - The company recorded a net loss of $18.4 million for the nine months ended September 30, 2022, an increase in loss of $8.3 million, or 83.1%, compared to a net loss of $10.0 million for the same period in 2021[118] Operating Expenses - Total operating expenses rose by 21.1% to $4,078,000 in Q3 2022 from $3,368,000 in Q3 2021[109] - Marketing, general and administrative expenses rose by $1.7 million, or 35.9%, to $6.4 million for the nine months ended September 30, 2022, compared to $4.7 million for the same period in 2021[120] - Operations and research expenses increased by $1.3 million, or 18.8%, to $8.2 million for the nine months ended September 30, 2022, compared to $6.9 million for the same period in 2021[121] - Total other income and expense resulted in a net expense of $10.5 million for the nine months ended September 30, 2022, an increase of $6.8 million, or 187.6%, compared to $3.6 million for the same period in 2021[122] Cash Flow and Debt - Net cash used in operating activities for the nine months ended September 30, 2022 was $6.0 million, an increase of approximately $1.9 million compared to $4.1 million for the same period in 2021[125] - Cash and cash equivalents at September 30, 2022 were $6.8 million, an increase of $4.5 million from $2.3 million at December 31, 2021[128] - Financial debt increased to $44.6 million at September 30, 2022, compared to $41.3 million at December 31, 2021[130] - The carrying value of the debt as of September 30, 2022, was $24,204,704, compared to $18,323,097 on December 31, 2021, representing an increase of approximately 32.3%[133] - The total face value of the debt obligation at September 30, 2022, was $24,821,967, compared to $19,266,818 at the end of 2021, showing an increase of about 29.5%[133] - The consolidated non-restricted cash balance at September 30, 2022, was $6.8 million, with a working capital deficit of $53.1 million[144] Legal and Regulatory Matters - Odyssey is seeking over $2 billion in compensation from Mexico due to repeated unlawful denials of environmental permits for the ExO project[91] - The company has secured funding of up to $10 million for litigation costs related to the NAFTA case[94] Project Developments - The ExO Phosphate Project is expected to provide significant benefits to Mexico's agricultural development and is located within a 50-year mining concession[86][87] - The Lihir Gold Project has an 85.6% interest in Bismarck Mining Corporation, which holds the exploration license for gold targets in Papua New Guinea[95] - The South American Phosphate Project will be a joint venture where Odyssey holds a 75% interest, covering 366 square kilometers of seabed[104][106] - The CIC Consortium, which includes Odyssey, received a five-year exploration license from the Cook Islands, with operations commencing in 2022[102][103] - The exploration program for the Lihir Gold Project aims to validate and quantify precious and base metal content, with offshore surveys completed in early 2022[98][99] Financing Activities - The company raised $10.9 million from financing activities during the nine months ended September 30, 2022, compared to $1.5 million for the same period in 2021[127] - The company generated net proceeds of $14.7 million from the sale of 4,939,515 shares of common stock and warrants, after offering expenses of $1.8 million[141] Interest Expense - For the three months ended September 30, 2022, interest expense from debt discount amortization was $76,133, compared to $63,689 for the same period in 2021, reflecting a year-over-year increase of approximately 19.3%[133] - For the nine months ended September 30, 2022, interest expense from debt discount amortization totaled $216,286, up from $174,420 in 2021, indicating a growth of about 24%[133] - The company recognized $300,000 of interest expense for the nine months ended September 30, 2022, related to the Note Agreement with 37North[138] Concerns and Risks - The company has experienced several years of net losses and may continue to do so, raising concerns about its ability to continue as a going concern[140] - The company does not engage in off-balance sheet financing arrangements and has no interest in limited purpose entities[149]