Part I: Financial Information [Item 1. Financial Statements (unaudited)](index=3&type=section&id=Item%201.%20Financial%20Statements%20%28unaudited%29) Presents unaudited financial statements, including balance sheets, operations, equity changes, cash flows, and detailed notes. Condensed Consolidated Balance Sheets | Metric | June 30, 2025 | December 31, 2024 | | :----------------------------- | :------------ | :---------------- | | Cash and cash equivalents | $3,551,429 | $4,791,743 | | Total current assets | $4,031,207 | $5,761,133 | | Total non-current assets | $12,540,857 | $12,730,757 | | **Total assets** | **$16,572,064** | **$18,491,890** | | Total current liabilities | $30,966,475 | $22,467,358 | | Total liabilities | $106,837,978 | $97,575,061 | | Total stockholders' deficit | $(90,265,914) | $(79,083,171) | Condensed Consolidated Statements of Operations Three Months Ended June 30, | Metric | 2025 | 2024 | Change ($) | Change (%) | | :--------------------------------------- | :----------- | :----------- | :----------- | :--------- | | Total revenue | $135,000 | $215,565 | $(80,565) | **(37.4%)** | | Total operating expenses | $4,510,310 | $3,231,567 | $1,278,743 | **39.6%** | | Loss from operations | $(4,375,310) | $(3,016,002) | $(1,359,308) | **45.1%** | | Total other (expense) income | $(12,764,187) | $(712,725) | $(12,051,462) | **1690.2%** | | Net loss | $(17,139,497) | $(3,728,727) | $(13,410,770) | **360.0%** | | Net (loss) income attributable to Odyssey Marine Exploration, Inc. | $(14,847,963) | $(1,527,103) | $(13,320,860) | **872.3%** | | Basic EPS | **$(0.48)** | **$(0.07)** | **$(0.41)** | **585.7%** | | Diluted EPS | **$(0.48)** | **$(0.07)** | **$(0.41)** | **585.7%** | Six Months Ended June 30, | Metric | 2025 | 2024 | Change ($) | Change (%) | | :--------------------------------------- | :----------- | :----------- | :----------- | :--------- | | Total revenue | $270,000 | $418,629 | $(148,629) | **(35.5%)** | | Total operating expenses | $6,870,959 | $8,151,761 | $(1,280,802) | **(15.7%)** | | Loss from operations | $(6,600,959) | $(7,733,132) | $1,132,173 | **(14.6%)** | | Total other (expense) income | $(10,954,192) | $4,925,373 | $(15,879,565) | **(322.4%)** | | Net loss | $(17,555,151) | $(2,807,759) | $(14,747,392) | **525.2%** | | Net (loss) income attributable to Odyssey Marine Exploration, Inc. | $(12,606,393) | $1,970,921 | $(14,577,314) | **(739.6%)** | | Basic EPS | **$(0.42)** | **$0.10** | **$(0.52)** | **(520.0%)** | | Diluted EPS | **$(0.42)** | **$0.03** | **$(0.45)** | **(1500.0%)** | Condensed Consolidated Statements of Changes in Stockholders' Deficit - Total stockholders' deficit increased from **$(79.1 million)** at December 31, 2024, to **$(90.3 million)** at June 30, 2025, primarily due to net losses and adjustments related to additional paid-in capital and non-controlling interest[13](index=13&type=chunk)[16](index=16&type=chunk) - For the six months ended June 30, 2025, the company recorded a net loss of **$(17.6 million)**[16](index=16&type=chunk) - Common stock issued in connection with the Securities Purchase Agreement contributed **$2.8 million** to additional paid-in capital for the six months ended June 30, 2025[16](index=16&type=chunk) Condensed Consolidated Statements of Cash Flows Six Months Ended June 30, | Metric | 2025 | 2024 | Change ($) | | :--------------------------------------- | :----------- | :----------- | :----------- | | Net Cash (Used In) Provided By Operating Activities | $(3,933,322) | $3,965,761 | $(7,899,083) | | Net Cash Provided By (Used In) Investing Activities | $0 | $(84,350) | $84,350 | | Net Cash Provided By (Used In) Financing Activities | $2,693,008 | $(327,135) | $3,020,143 | | Net (Decrease) Increase In Cash | $(1,240,314) | $3,554,276 | $(4,794,590) | | Cash at End of Period | $3,551,429 | $7,575,996 | $(4,024,567) | Notes to the Condensed Consolidated Financial Statements NOTE 1 – BUSINESS AND BASIS OF PRESENTATION - The company has experienced several years of net losses and its ability to generate net income or positive cash flows depends on financings and monetization of mineral exploration interests[20](index=20&type=chunk) Financial Position (June 30, 2025) | Metric | Amount | | :-------------------------- | :----------- | | Consolidated cash balance | **$3.6 million** | | Working capital deficit | **$26.9 million** | | Total consolidated assets | **$16.6 million** | - These factors raise doubt about the company's ability to continue as a going concern[23](index=23&type=chunk) NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - The company consolidates wholly-owned subsidiaries and uses the equity method for investments where it exercises significant influence but not control[25](index=25&type=chunk) - The Bismarck Exploration License is treated as an indefinite-life intangible asset, tested annually for impairment. A renewal application was submitted in July 2024, with a response expected by September 30, 2025[27](index=27&type=chunk) - New accounting pronouncements include ASU 2023-09 (Income Taxes, effective after Dec 15, 2024), ASU 2024-03 (Expense Disaggregation, effective after Dec 15, 2026), and ASU 2025-05 (Credit Losses, effective after Dec 15, 2025). The company is evaluating their potential impact[36](index=36&type=chunk)[37](index=37&type=chunk)[38](index=38&type=chunk) NOTE 3 – ACCOUNTS RECEIVABLE AND OTHER RELATED PARTY RECEIVABLES, NET Accounts Receivable and Other, Net | Category | June 30, 2025 | December 31, 2024 | | :--------------- | :------------ | :---------------- | | Related party | **$67,316** | **$67,320** | | Other | **$0** | **$218,444** | | **Total** | **$67,316** | **$285,764** | NOTE 4 – OTHER CURRENT ASSETS Other Current Assets | Category | June 30, 2025 | December 31, 2024 | | :------------- | :------------ | :---------------- | | Prepaid assets | **$248,813** | **$564,930** | | Other | **$128,574** | **$83,430** | | Deposits | **$35,075** | **$35,266** | | **Total** | **$412,462** | **$683,626** | NOTE 5 – RELATED PARTY TRANSACTIONS - Odyssey provides services to CIC Limited (**14.2%** equity interest) and Ocean Minerals, LLC (**7.0%** equity interest), both related parties, and is compensated with equity[42](index=42&type=chunk)[43](index=43&type=chunk)[44](index=44&type=chunk)[45](index=45&type=chunk) - On June 10, 2025, Odyssey converted **$137.7 million** of Oceanica-ExO Indebtedness (notes and arbitration expenses) into Oceanica Quotas, increasing its ownership in Oceanica[49](index=49&type=chunk) - In June 2025, Subsidiary D&Os exchanged **1,911,666 Oceanica Compensation Quotas** for **1,841,137 shares** of Odyssey common stock, and Odyssey exchanged its Oceanica equity for a **78.3%** interest in ORM[51](index=51&type=chunk)[52](index=52&type=chunk) - FourWorld, Two Seas, and CapLat are significant stockholders involved in various financing transactions, including notes and warrants. Two Seas exercised March 2023 Warrants for **460,000 shares** in April 2025[54](index=54&type=chunk)[55](index=55&type=chunk)[56](index=56&type=chunk)[57](index=57&type=chunk)[58](index=58&type=chunk) - In Q2 2025, Two Seas purchased **1,312,647** and CapLat purchased **489,279** additional shares under the Securities Purchase Agreement (SPA)[66](index=66&type=chunk) NOTE 6 – INVESTMENT IN UNCONSOLIDATED ENTITIES Investment in Unconsolidated Entities (Carrying Value) | Entity | June 30, 2025 | December 31, 2024 | | :-------------------------- | :------------ | :---------------- | | Phosagmex, S.A.P.I. de C.V. | **$157** | **$0** | | CIC Limited | $5,228,449 | $5,003,449 | | Ocean Minerals, LLC | $4,609,222 | $4,882,330 | | **Total** | **$9,837,828** | **$9,885,779** | - CIC Limited is accounted for under the cost method, as Odyssey is not its primary beneficiary. Ocean Minerals, LLC (OML) is accounted for under the equity method, with Odyssey recognizing losses of **$0.2 million** (Q2 2025) and **$0.3 million** (H1 2025) from its proportionate share of OML's net loss[64](index=64&type=chunk)[69](index=69&type=chunk)[75](index=75&type=chunk) - Investments in Neptune Minerals, Inc. and Chatham Rock Phosphate, Limited are carried at zero value due to prior unrecognized losses or minimal ownership[78](index=78&type=chunk)[79](index=79&type=chunk) NOTE 7 – JOINT VENTURE - Odyssey and CapLat formed Phosagmex, S.A.P.I. de C.V. on June 4, 2025, as a joint venture for a strategic fertilizer production project in Mexico, with each holding **50%** equity interests[80](index=80&type=chunk)[81](index=81&type=chunk) - CapLat's contributions include project participation and **$0.2 million** cash, while Odyssey contributes legal rights to ExO mining concessions (subject to reinstatement) and **$0.2 million** cash, along with technical expertise[85](index=85&type=chunk)[86](index=86&type=chunk) - The joint venture will be accounted for using the equity method, as neither party has controlling financial interest under the voting interest model[88](index=88&type=chunk) NOTE 8 – INCOME TAXES - As of June 30, 2025, the company had federal net operating loss (NOL) carryforwards of approximately **$203.8 million** and foreign NOL carryforwards of approximately **$32.1 million**[90](index=90&type=chunk) - Approximately **$27.2 million** of NOLs will expire from 2026-2027, **$128.0 million** from 2028-2037, and **$44.3 million** (generated 2018-2024) will be carried forward indefinitely[90](index=90&type=chunk) NOTE 9 – COMMITMENTS AND CONTINGENCIES - The company is not a party to any litigation as a defendant requiring loss contingency reflection in its financial statements[91](index=91&type=chunk) - ExO has contingent success fees of up to **$0.7 million** for EIA approval and **$0.3 million** for favorable litigation outcome in Mexico, neither of which have been accrued as the likelihood of payment is not probable[92](index=92&type=chunk) - A lease agreement was extended to July 31, 2026, and is accounted for using the short-term exception under ASC 842, resulting in no ROU asset or lease obligation recorded[93](index=93&type=chunk) - The JV Agreement includes exclusive development rights and a **$10.0 million** termination fee if terminated due to a change of control[95](index=95&type=chunk) NOTE 10 – LOANS PAYABLE Consolidated Loans Payable, Net | Category | June 30, 2025 | December 31, 2024 | | :-------------------------------- | :------------ | :---------------- | | Total Loans payable, net | $24,673,892 | $22,935,530 | | Less: Current portion of loans payable | $(20,801,906) | $(13,084,379) | | Loans payable—long term | $3,871,986 | $9,851,151 | - The March 2023 Note's maturity was extended to December 31, 2025, and a conversion feature was added, allowing conversion into common stock at a rate of **75%** of the 30-day VWAP (min **$1.10**, max **$2.20**). The embedded derivative fair value was **$3.1 million** at June 30, 2025[101](index=101&type=chunk)[107](index=107&type=chunk)[135](index=135&type=chunk) - The December 2023 Note's embedded derivative fair value was **$0.5 million** at June 30, 2025. Both March and December 2023 Notes have an **11.0%** interest rate[117](index=117&type=chunk)[118](index=118&type=chunk)[135](index=135&type=chunk) - Amendments in January, February, and June 2025 adjusted security interests, consented to the JV Agreement, released liens on Oceanica equity, and granted new liens on ORM equity[108](index=108&type=chunk)[109](index=109&type=chunk)[111](index=111&type=chunk)[119](index=119&type=chunk) NOTE 11 – FAIR VALUE MEASUREMENTS Fair Value of Level 3 Liabilities (Recurring Basis) | Liability | June 30, 2025 | December 31, 2024 | | :-------------------------------- | :------------ | :---------------- | | Litigation financing | $59,470,022 | $56,950,377 | | 2022 Warrants | $4,384,094 | $2,060,773 | | March 2023 Warrants | $2,577,392 | $1,910,950 | | December 2023 Warrants | $1,611,829 | $827,036 | | March 2023 Note Conversion Option | $3,095,000 | $2,745,000 | | December 2023 Note Conversion Option | $509,000 | $307,000 | | **Total** | **$71,647,337** | **$64,801,136** | - Litigation financing is valued based on probability-weighted present value. Warrants are valued using a Black-Scholes model, and embedded derivatives for conversion options use a with-and-without valuation method, both relying on inputs like expected volatility, risk-free interest rate, and expected life[125](index=125&type=chunk)[126](index=126&type=chunk)[127](index=127&type=chunk) NOTE 12 – DERIVATIVE FINANCIAL INSTRUMENTS - Litigation financing is treated as a derivative, with a fair value of **$59.5 million** at June 30, 2025, and changes in fair value reported in earnings. The NAFTA arbitral tribunal awarded **$37.1 million** plus interest to Odyssey and ExO against Mexico, but Mexico's set-aside application is pending[132](index=132&type=chunk)[133](index=133&type=chunk) - Conversion features in the March 2023 and December 2023 Notes are embedded derivatives, recorded at fair value and remeasured each period. Their fair values were **$3.1 million** and **$0.5 million**, respectively, at June 30, 2025[134](index=134&type=chunk)[135](index=135&type=chunk) NOTE 13 – ACCRUED EXPENSES Accrued Expenses | Category | June 30, 2025 | December 31, 2024 | | :---------------------- | :------------ | :---------------- | | Compensation and incentives | **$2,343** | **$2,400** | | Professional services | **$484,668** | **$395,476** | | Deposits | **$450,000** | **$450,000** | | Accrued Interest | $1,073,521 | $1,022,272 | | Exploration license fees | $7,461,055 | $6,764,428 | | **Total** | **$9,471,587** | **$8,634,576** | - Deposits include a **$0.5 million** earnest money deposit from CIC related to a potential equity stake sale[136](index=136&type=chunk) NOTE 14 – STOCKHOLDERS' EQUITY/(DEFICIT) - Subsidiary D&Os exchanged Oceanica interests for **1,841,137 shares** of Odyssey common stock on June 27, 2025, resulting in a **$2.0 million** incremental value recognized as stock-based compensation[138](index=138&type=chunk)[270](index=270&type=chunk) - Under the SPA, **2,601,595 additional shares** were purchased in Q2 2025 for **$2.9 million**, with **4,618,546 options** remaining outstanding as of June 30, 2025. Subsequent to June 30, 2025, **4,373,893 shares** were purchased for **$4.8 million**[143](index=143&type=chunk)[164](index=164&type=chunk)[271](index=271&type=chunk) - Share-based compensation expense was **$91,484** for H1 2025 (down from **$1.6 million** in H1 2024). The company issued **225,500 shares** to a consultant and granted **36,404 RSUs** and **7,500 stock options** to directors, all vesting immediately[144](index=144&type=chunk)[145](index=145&type=chunk)[146](index=146&type=chunk) Warrants Outstanding | Metric | June 30, 2025 | December 31, 2024 | | :-------------------- | :------------ | :---------------- | | Number of Warrants | **10,267,387** | **10,727,387** | | Weighted Average Exercise Price | **$2.36** | **$2.30** | - **460,000 warrants** were exercised in H1 2025 at an exercise price of **$1.10** per share[149](index=149&type=chunk)[271](index=271&type=chunk) NOTE 15 – CONCENTRATION OF CREDIT RISK - **100%** of total revenue for the three and six months ended June 30, 2025 and 2024, came from two related parties: CIC and OML[153](index=153&type=chunk) - These same two customers accounted for **100%** of the total accounts receivable balance as of June 30, 2025 (compared to **23.6%** at December 31, 2024)[153](index=153&type=chunk) NOTE 16 – SALE-LEASEBACK FINANCING OBLIGATIONS - Sale-leaseback transactions of marine equipment are accounted for as financing transactions, with Odyssey obligated to pay lease payments and repurchase amounts for the ORI asset[156](index=156&type=chunk)[157](index=157&type=chunk) - The carrying values of these financing liabilities were **$4.3 million** at June 30, 2025, and **$4.2 million** at December 31, 2024[158](index=158&type=chunk) Remaining Future Cash Payments for Financing Liability | Year Ending December 31, | Annual payment obligation | | :----------------------- | :------------------------ | | 2025 (remainder) | **$270,000** | | 2026 | **$540,000** | | 2027 | $4,710,000 | | **Total** | **$5,520,000** | NOTE 17 – SEGMENT REPORTING - The company operates as a single operating and reportable segment, as the chief operating decision maker (CODM) reviews financial information on a consolidated basis[160](index=160&type=chunk) Significant Segment Expenses (Six Months Ended June 30) (in thousands) | Expense Category | 2025 | 2024 | Change ($) | Change (%) | | :--------------------------------------- | :---------- | :---------- | :--------- | :--------- | | Professional fees | $1,832,441 | $1,350,390 | $482,051 | **35.7%** | | Operations and research (excl. comp) | $932,654 | $1,597,997 | $(665,343) | **(41.6%)** | | Salaries and Wages | $3,728,687 | $1,709,903 | $2,018,784 | **118.1%** | | Share-based compensation | **$91,484** | $1,564,532 | $(1,473,048) | **(94.2%)** | | **Total Significant Expenses** | **$6,585,266** | **$6,222,822** | **$362,444** | **5.8%** | NOTE 18 – SUBSEQUENT EVENTS - In July and August 2025, holders of December 2023 Notes converted **$2.0 million** into **1,806,079 shares** of Common Stock, and holders of March 2023 Notes converted **$7.7 million** into **6,965,163 shares** of Common Stock[162](index=162&type=chunk)[163](index=163&type=chunk) - In July 2025, purchasers under the SPA exercised options to buy **4,373,893 shares** of Common Stock for **$4.8 million**[164](index=164&type=chunk) - On August 7, 2025, Odyssey contributed a **$2.0 million** ExO Receivable to ORM, which ORM will contribute to Phosagmex as part of the JV Agreement[165](index=165&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=36&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management's analysis of financial performance, operational updates, going concern, liquidity, and accounting estimates. Operational Update - The Phosagmex Project, a joint venture in Mexico for fertilizer production, is progressing despite unlawful cancellation of ExO's mining concessions, which are currently under legal challenge for reinstatement[171](index=171&type=chunk)[172](index=172&type=chunk)[177](index=177&type=chunk) - The NAFTA arbitral tribunal awarded **$37.1 million** plus interest to Odyssey and ExO against Mexico for breaches, though Mexico's set-aside application is pending[180](index=180&type=chunk)[182](index=182&type=chunk) - The CIC Project and Ocean Minerals, LLC Project in the Cook Islands are advancing exploration activities under five-year licenses, with OML working towards a preliminary Feasibility Study[184](index=184&type=chunk)[187](index=187&type=chunk)[189](index=189&type=chunk) - The Lihir Gold Project in Papua New Guinea received a license renewal in November 2023, with ongoing exploration to validate and quantify resources and gather environmental baseline data[193](index=193&type=chunk)[194](index=194&type=chunk)[195](index=195&type=chunk) - Executive Order 14285, issued April 24, 2025, by the U.S. President, aims to expedite offshore critical mineral exploration, positioning Odyssey to benefit from regulatory momentum[197](index=197&type=chunk)[198](index=198&type=chunk) Going Concern Consideration - The company's ability to continue as a going concern is in doubt due to several years of net losses and a working capital deficit of **$26.9 million** at June 30, 2025[200](index=200&type=chunk)[203](index=203&type=chunk) - The 2025 business plan relies on generating new cash inflows through monetization of equity stakes, financings, and partnerships[201](index=201&type=chunk) - Recent financing activities, including amendments to March and December 2023 Notes and sales of common stock under the SPA (totaling **6,975,488 additional shares** subsequent to March 31, 2025), are expected to provide operating funds through at least Q4 2025[202](index=202&type=chunk) Results of Operations Three Months Ended June 30, 2025 vs 2024 (in thousands) | Metric | 2025 | 2024 | Change ($) | Change (%) | | :--------------------------------------- | :----------- | :----------- | :----------- | :--------- | | Total revenue | **$135** | **$216** | **$(81)** | **(37.5%)** | | Marketing, general and administrative | **$3,813** | **$2,205** | **$1,608** | **72.9%** | | Operations and research | **$698** | **$1,027** | **$(329)** | **(32.0%)** | | Total operating expenses | **$4,510** | **$3,232** | **$1,279** | **39.6%** | | Total other (expense) income | **$(12,764)** | **$(713)** | **$(12,051)** | **1690.2%** | | Net loss | **$(17,139)** | **$(3,729)** | **$(13,410)** | **360.0%** | | Net loss attributable to Odyssey Marine Exploration, Inc. | **$(14,848)** | **$(1,527)** | **$(13,321)** | **872.4%** | - The increase in Marketing, general and administrative expenses for Q2 2025 was primarily due to a **$2.2 million** increase in director fees related to Mexican Corporate Transactions[208](index=208&type=chunk) - Total other (expense) income for Q2 2025 was significantly impacted by a **$1.8 million** increase in derivative liabilities fair value change and the absence of **$9.4 million** in residual economic interest from a shipwreck recognized in 2024[211](index=211&type=chunk) Six Months Ended June 30, 2025 vs 2024 (in thousands) | Metric | 2025 | 2024 | Change ($) | Change (%) | | :--------------------------------------- | :----------- | :----------- | :----------- | :--------- | | Total revenue | **$270** | **$419** | **$(149)** | **(35.6%)** | | Marketing, general and administrative | **$5,601** | **$6,239** | **$(638)** | **(10.2%)** | | Operations and research | **$1,270** | **$1,912** | **$(642)** | **(33.6%)** | | Total operating expenses | **$6,871** | **$8,152** | **$(1,281)** | **(15.7%)** | | Total other (expense) income | **$(10,954)** | **$4,925** | **$(15,879)** | **(322.4%)** | | Net loss | **$(17,555)** | **$(2,808)** | **$(14,747)** | **525.2%** | | Net (loss) income attributable to Odyssey Marine Exploration, Inc. | **$(12,606)** | **$1,971** | **$(14,577)** | **(739.6%)** | - For H1 2025, Marketing, general and administrative expenses decreased due to lower professional services and share-based compensation, partially offset by **$2.1 million** in director fees related to Mexican Corporate Transactions[217](index=217&type=chunk)[218](index=218&type=chunk) - Total other (expense) income for H1 2025 decreased significantly due to a **$6.4 million** increased loss in derivative liabilities fair value change and the absence of **$9.4 million** shipwreck income from 2024[220](index=220&type=chunk) Liquidity and Capital Resources Summary of Cash Flows (Six Months Ended June 30) (in thousands) | (in thousands) | 2025 | 2024 | Change ($) | | :--------------------------------------- | :--- | :--- | :--- | | Net Cash (Used In) Provided By Operating Activities | **$(3,933)** | **$3,966** | **$(7,899)** | | Net Cash Provided By (Used In) Investing Activities | **$0** | **$(84)** | **$84** | | Net Cash Provided By (Used In) Financing Activities | **$2,693** | **$(327)** | **$3,020** | | Net (Decrease) Increase In Cash | **$(1,240)** | **$3,554** | **$(4,794)** | | Cash at End of Period | **$3,551** | **$7,576** | **$(4,025)** | - Net cash used in operating activities was **$3.9 million** for H1 2025, a significant shift from **$4.0 million** provided in H1 2024, primarily due to a higher net loss and changes in non-cash adjustments[224](index=224&type=chunk)[225](index=225&type=chunk)[226](index=226&type=chunk) - Net cash provided by financing activities was **$2.7 million** for H1 2025, mainly from common stock issuance (**$2.9 million**) and warrant exercises (**$0.5 million**), partially offset by debt and sale-leaseback payments[230](index=230&type=chunk) Consolidated Loans Payable, Net | Category | June 30, 2025 | December 31, 2024 | | :-------------------------------- | :------------ | :---------------- | | Total Loans payable, net | $24,673,892 | $22,935,530 | | Less: Current portion of loans payable | $(20,801,906) | $(13,084,379) | | Loans payable—long term | $3,871,986 | $9,851,151 | - The March 2023 Note and December 2023 Note, both with an **11.0%** interest rate, have been amended to extend maturity dates and add conversion features, impacting their carrying values and derivative liabilities[239](index=239&type=chunk)[244](index=244&type=chunk)[255](index=255&type=chunk) Critical Accounting Estimates - There have been no material changes in the company's critical accounting estimates since December 31, 2024[258](index=258&type=chunk) New Accounting Pronouncements - Refer to Note 2 – Summary of Significant Accounting Policies, for details on new accounting pronouncements[259](index=259&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=49&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company reports no material market risk exposure and has not used market risk sensitive instruments. - The company does not believe it has material market risk exposure[260](index=260&type=chunk) - No market risk sensitive instruments have been used for mitigation, trading, or speculative purposes[260](index=260&type=chunk) [Item 4. Controls and Procedures](index=51&type=section&id=Item%204.%20Controls%20and%20Procedures) Disclosure controls were ineffective due to a material weakness in financial reporting; remediation efforts are underway. - Disclosure controls and procedures were not effective as of June 30, 2025[262](index=262&type=chunk) - A material weakness in internal control over financial reporting was identified as of December 31, 2023, concerning insufficient resources for technical accounting and inadequate review processes for financial statement footnote disclosures[264](index=264&type=chunk) - Remediation efforts include hiring a controller, evaluating existing personnel, engaging accounting advisory consultants, and reinforcing control performance adherence[265](index=265&type=chunk) - The material weakness will not be considered remediated until controls operate effectively for a sufficient period and are tested[266](index=266&type=chunk) Part II: Other Information [Item 1. Legal Proceedings](index=52&type=section&id=Item%201.%20Legal%20Proceedings) The company is not a defendant in any litigation requiring loss contingency reflection in its financial statements. - The company is not a party to any litigation as a defendant where a loss contingency is required to be reflected in its condensed consolidated financial statements[268](index=268&type=chunk) [Item 1A. Risk Factors](index=52&type=section&id=Item%201A.%20Risk%20Factors) No material changes to the principal risk factors previously disclosed in the company's 2024 Annual Report on Form 10-K. - No material changes to the principal risk factors previously disclosed in the Company's Annual Report on Form 10-K for the year ended December 31, 2024[269](index=269&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=52&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) Reports unregistered equity sales, including Oceanica interest exchanges and warrant exercises, funding company operations. - On June 27, 2025, Subsidiary D&Os exchanged **1,911,666 member interests** of Oceanica for **1,841,137 shares** of Odyssey's common stock, which are contractually restricted[270](index=270&type=chunk) - During Q2 2025, purchasers exercised options for **2,601,595 additional shares** and holders of March 2023 Warrants exercised for **460,000 shares**, generating aggregate proceeds of **$3.5 million** to fund operations[271](index=271&type=chunk) [Item 4. Mine Safety Disclosures](index=52&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) Not applicable. - Not applicable[273](index=273&type=chunk) [Item 5. Other Information](index=52&type=section&id=Item%205.%20Other%20Information) CEO and President/COO adopted Rule 10b5-1 trading plans for common stock sales, managed by a brokerage firm. - CEO Mark D. Gordon and President/COO John D. Longley adopted Rule 10b5-1 trading plans on May 15, 2025, for the sale of company common stock[273](index=273&type=chunk) - Mr. Gordon's plan (expiring Aug 14, 2026) relates to up to **200,000 shares**, and Mr. Longley's plan (expiring Dec 31, 2026) relates to up to **256,049 shares** from vested stock options and restricted stock units[274](index=274&type=chunk) - Sales under these plans are managed by a securities brokerage firm, with no control over timing by the executives, and subject to specified minimum prices[274](index=274&type=chunk) [Item 6. Exhibits](index=53&type=section&id=Item%206.%20Exhibits) Lists all exhibits filed with the Form 10-Q, including agreement amendments, a shareholders agreement, and certifications. - The exhibits include amendments to the Securities Purchase Agreement and Joint Venture Agreement, a Shareholders Agreement dated June 4, 2025, and certifications of the Principal Executive Officer and Principal Financial Officer[275](index=275&type=chunk) Signatures [Signatures](index=54&type=section&id=Signatures) Contains required signatures for the Form 10-Q, certifying its submission on behalf of Odyssey Marine Exploration, Inc. - The report was signed by Mark D. Gordon, Chief Executive Officer, Principal Executive Officer, and Principal Financial Officer on August 19, 2025[280](index=280&type=chunk)

Core Viewpoint - The article highlights significant movements in the Hong Kong and US stock markets, focusing on various companies' performances and the impact of regulatory changes on specific sectors. Group 1: Hong Kong Stock Market Highlights - Haitian Flavoring (03288) debuted with over a 3% increase, raising HKD 10 billion and holding a 6.2% global market share in soy sauce, leading the Chinese seasoning market with a 4.8% share [1] - Stablecoin concept stocks surged, with Lianlian Digital up 11%, Yika up 9%, and Zhong An Online up 8%, driven by the implementation of Hong Kong's stablecoin regulations [1] - Hezhima Intelligent (02533) rose over 3% as it plans to acquire an AI chip company to expand its automotive and edge AI product lines [1] - Delin Holdings (01709) increased over 3% with an expected annual profit growth of 10%-30% (to HKD 110-130 million) and its subsidiary Synaptic Technology securing tens of millions in A-round financing [1] - Jingtai Technology (02228) saw over a 4% rise, producing its first clinical candidate drug, PRMT5 inhibitor PE-0260, with clinical trials set to start in the second half of 2025 [1] - Gold stocks collectively fell, with Lingbao Gold and Zhu Feng Gold both down 4%, affected by a pullback in spot gold prices [1] - Innovent Biologics (01801) rose over 4% after obtaining global rights for GlycoT's ADC technology, with positive outlooks for IBI363/343's international potential [1] - Longpan Technology (02465) increased over 6% due to policy support accelerating solid-state battery industrialization, with the Ministry of Industry and Information Technology allocating HKD 6 billion for special research [1] Group 2: Other Notable Movements - Simor International (06969) fell over 5% as shareholder Yiwei Lithium Energy announced a third reduction of 3.5% in its stake, dropping to 27% and losing control [2] - Fubo Group (03738) rose over 4% due to favorable policies for data asset REITs, with the company targeting annual AI business revenue in the million-dollar range [2] - Yadea Holdings (01585) increased over 4% with a projected 55% rise in H1 net profit to HKD 1.6 billion, driven by new national standards enhancing industry concentration [2] - Perfect Medical (01830) fell over 6% as medical beauty consumption shifted to Shenzhen and South Korea, with an expected 35% decline in annual profit [2] - Yunbai International (00030) surged over 15% after acquiring global distribution rights from its parent company Yunnan Baiyao, covering a full range of products including medicines and personal care [2] - Luk Fook Holdings (00590) dropped over 4% due to increased gold hedging losses from rising gold prices and high base effects from last year's acquisition of King of Gold [2] Group 3: US Stock Market Highlights - Brain Regen Technologies (RGC.US) fell over 18% after a 400% increase in the previous two days, as profit-taking occurred; the company focuses on liquid formulations for ADHD and autism [3] - Marvell Technology (MRVL.US) rose over 7% after announcing a collaboration to develop AI power solutions and launching a 2nm custom SRAM chip with leading bandwidth and energy efficiency [3] - Circle (CRCL.US) surged over 33% after the US Senate passed a stablecoin bill, boosting the stock's value by 410% since its listing [3] - The rare earth sector continued to rise, with MP Materials up 4.9% and USA Rare Earth up 5.58%, driven by policy support for strategic resource demand [3] - Wolfspeed (WOLF.US) fell over 30% amid reports of a potential bankruptcy agreement, despite the silicon carbide market projected to reach USD 29 billion by 2030 [3] - Odyssey Marine (OMEX.US) rose over 11% after Trump signed an executive order to expedite deep-sea mining permits, with a 93% increase year-to-date [3] - Huya (HUYA.US) increased over 3% as the "HYPER eSports Carnival" is set to open in Chengdu, boosting platform traffic and commercialization expectations [3] Group 4: Additional Notable Movements - AST SpaceMobile (ASTS.US) rose over 10%, with an 85% increase in June, partnering with Vodafone India to provide satellite connectivity to unconnected areas [4] - Arqit Quantum (ARQQ.US) surged over 22% after being selected for Oracle's defense ecosystem, highlighting the strategic value of quantum encryption technology [4] - Aptevo (APVO.US) skyrocketed over 81% due to a new leukemia drug showing an 85% response rate in frontline treatment [4] - Upstart (UPST.US) rose over 10% after Bank of America raised its target price to USD 56, maintaining a "hold" rating as the credit tech platform's valuation recovers [4] - Coinbase (COIN.US) increased over 16% as it plans to apply to the SEC for "tokenized stocks," opening new growth opportunities in traditional equity on-chain [5]

Summary of Odyssey Marine Exploration (OMEX) Conference Call Company Overview - **Company**: Odyssey Marine Exploration Inc. (OMEX) - **Ticker Symbol**: OMEX - **Industry**: Seafloor mineral exploration, focusing on sustainable and responsible extraction of critical minerals and metals from the ocean floor, including battery metals and phosphates for fertilizers [1][2] Key Points and Arguments 1. **Stock Performance**: The stock price increased from $0.69 on April 16 to over $1.20 within two months, indicating positive market sentiment and potential growth [3] 2. **Market Opportunity**: The company emphasizes that all minerals available on land can also be found on the ocean floor, with a focus on battery metals for green energy and phosphates for food security [4] 3. **Operational Experience**: Odyssey has 30 years of experience in deep ocean operations, which provides a competitive advantage in navigating high barriers to entry in the industry [5] 4. **Valuation Perspective**: The current market cap is viewed as undervalued compared to historical valuations, suggesting significant upside potential if projects succeed [6] 5. **Executive Order Impact**: President Trump's executive order to accelerate seafloor mineral extraction is expected to positively influence the industry, enhancing opportunities for Odyssey and similar companies [7][8] 6. **Regulatory Compliance**: Odyssey has regained NASDAQ listing compliance and has seen an influx of capital from long-term investors, indicating renewed investor confidence [8][9] 7. **Project Updates**: - **Fosigmex Project**: The Mexican phosphate project has an internal net present value (NPV) of $1.3 billion, with Odyssey's ownership value projected between $212 million and $439 million [13] - **Cook Islands Projects**: Involvement in two out of three license holders, with OML on track to submit for an extraction permit by late 2026 and significant progress on pre-feasibility studies [11][12] - **CIC Project**: Potential asset value estimated between $710 million and $1.4 billion based on OML's valuation, indicating substantial growth potential [16] Additional Important Content 1. **Global Strategy**: The executive order is expected to influence global approaches to seabed mineral development, encouraging other countries to focus on similar initiatives [17][18] 2. **Data-Driven Approach**: Odyssey has evaluated 120 exclusive economic zones and identified 60 projects with high potential, showcasing a strategic approach to project selection [22] 3. **Environmental Considerations**: The company is committed to environmentally responsible practices in mineral extraction, aligning with global sustainability goals [22] This summary encapsulates the key insights and developments discussed during the Odyssey Marine Exploration conference call, highlighting the company's strategic positioning and growth potential in the seafloor mineral extraction industry.

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].