Odyssey Marine Exploration(OMEX) - 2021 Q4 - Annual Report

Revenue and Income - Total revenue for 2021 was $0.9 million, a decrease of $1.1 million or 54.8% compared to 2020[141] - Net income loss improved to $(10.0) million in 2021, a reduction of $4.9 million or 32.8% compared to $(14.8) million in 2020[141] - Total other income (expense) improved by $7.3 million, from $(8.5) million in 2020 to $(1.2) million in 2021[145] Expenses - Operating expenses increased by $1.2 million to $15.9 million in 2021, representing an 8.2% increase from the previous year[141] - Marketing, general and administrative expenses rose by $2.6 million to $6.3 million, a 68.6% increase year-over-year[141] - The company reported a gain on the sale of equipment of $0.3 million in 2021, contributing to the reduction in operating expenses[144] - Marketing, general and administrative expenses decreased by $1.7 million to $3.6 million in 2020 from $5.5 million in 2019, primarily due to a reduction in share-based compensation and employee incentives[163] - Operations and research expenses increased by $3.0 million from 2019 to 2020, driven by a $4.3 million rise in litigation-related expenses[164] Cash Flow and Liquidity - Cash and cash equivalents decreased to $2.3 million at the end of 2021, down $3.9 million from $6.2 million at the end of 2020[157] - Net cash used by operating activities was $(5.3) million in 2021, a decrease of $3.5 million compared to $(9.3) million in 2020[151] - The company reported a net cash used by operating activities of $9.3 million in 2020, an increase of $3.8 million compared to $5.4 million in 2019[170] - Cash flows provided by financing activities for 2020 were $15.2 million, a significant increase of $12.3 million from $2.9 million in 2019, including $11.3 million from a common stock sale[173] - The company had cash and cash equivalents of $6.2 million at the end of 2020, up from $0.2 million at the end of 2019, reflecting a net increase of $5.9 million[176] Financial Debt - Financial debt, excluding derivatives, was $42.2 million at December 31, 2021, down from $43.2 million at the end of 2020[158] - Financial debt increased to $43.2 million at December 31, 2020, compared to $33.9 million at December 31, 2019[177] - The total face value of the obligation as of December 31, 2021, was $19,266,818, compared to $12,207,477 in 2020[212] - The total carrying value of the obligation as of December 31, 2021, was $18,323,097, net of unamortized debt fees and discounts[212] Non-controlling Interest - Non-controlling interest for 2021 was $6.2 million, slightly down from $6.3 million in 2020[149] - The non-controlling interest adjustment for 2020 was $6.3 million, up from $5.1 million in 2019, primarily due to compounding debt interest on the Mexican subsidiary's balance sheet[167] Legal and Regulatory Matters - The company initiated arbitration against Mexico under NAFTA in January 2019, with significant legal proceedings ongoing as of September 2020[178] - The company has estimated a high likelihood of obtaining an environmental permit related to the Subject Claim, which may require interest recording under Generally Accepted Accounting Principles[201] Funding and Investment - The company raised $11.3 million from the sale of 2.5 million common shares in August 2020, contributing to its financing activities[177] - The company has a promissory note of up to $14.75 million with an interest rate of 8.0% per annum, secured by a pledge of 54.0 million shares of Oceanica Resources S. de R.L.[186] - The Funder has the right to continue funding beyond the maximum investment amount if exercised within specified timeframes[197] - The Funder agreed to make Claims Payments not exceeding $25 million under the Third Restated Agreement, an increase of $5 million from previous agreements[211] Other Financial Information - A valuation allowance of $74.1 million was recorded for deferred tax assets as of December 31, 2021, indicating they are unlikely to be realized[223] - The company executed a Termination and Settlement Agreement that removed approximately $14.5 million of indebtedness from its balance sheet in Q4 2021[216] - The consolidated non-restricted cash balance at December 31, 2021, was $2.3 million, with a working capital deficit of $49.3 million[216] - The exploration license held by the company is assessed to have an indefinite life based on historical renewal success since 2006[227] - As of December 31, 2021, the company had no contractual obligations extending beyond 12 months, except for the office lease[228] - The company does not believe it has material market risk exposure and has not entered into market risk sensitive instruments[229] - The company currently has no debt obligations or instruments that expose it to interest rate risk[230]