What changed in this filing

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Item 1. Financial Statements

2022-05-16 compared with 2021-11-15 · 188 added, 997 removed, 261 unchanged (82% of the section changed)

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AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

September 30,

CONDENSED CONSOLIDATED BALANCE SHEETS

March 31, 2022

CURRENT ASSETS

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Operating lease obligation

Deferred income and revenue participation rights

Total long-term liabilities

Total liabilities

Commitments and contingencies (NOTE H)

Commitments and contingencies (NOTE G)

STOCKHOLDERS’ EQUITY/(DEFICIT)

Preferred stock - $ 0.0001 par value;

Preferred stock –

$ .0001 par value;

24,984,166 shares authorized;

none outstanding

Common stock – $ 0.0001 par value;

no ne outstanding

Common stock –

$ .0001 par value;

75,000,000 shares authorized;

13,307,180 and 12,591,084 issued and outstanding

14,487,146 and 14,309,315 issued and

Additional paid-in

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Total liabilities and stockholders’ equity/(deficit)

The accompanying notes are an integral part of these consolidated financial statements.

The accompanying notes are an integral part of these condensed consolidated financial statements.

ODYSSEY MARINE EXPLORATION, INC.

AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS - Unaudited

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS – Unaudited

Three Months Ended

Nine Months Ended

September 30,

Service revenue and other

Marine services

Operating and other

Total revenue

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Interest expense

Gain (loss) on debt extinguishment

Loss in hybrid-instrument fair value

Total other income (expense)

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Weighted average number of common shares outstanding

The accompanying notes are an integral part of these consolidated financial statements.

The accompanying notes are an integral part of these condensed consolidated financial statements.

ODYSSEY MARINE EXPLORATION, INC.

AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDER’S EQUITY / (DEFICIT) - Unaudited

Three Months Ended September 30, 2021

Non-controlling

June 30, 2021

( 271,082,179

Share-based compensation

Common stock issued for converted convertible debt

September 30, 2021

( 275,167,476

Three Months Ended September 30, 2020

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDER’S EQUITY / (DEFICIT) – Unaudited

Three Months Ended March 31, 2022

Non-controlling

June 30, 2020

December 31, 2021

( 275,090,857

Share-based compensation

Fair value of warrants issued

Common stock issued

Debt modification

September 30, 2020

March 31, 2022

( 283,321,086

Nine Months Ended September 30, 2021

Three Months Ended March 31, 2021

Non-controlling

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Sale of subsidiary equity

September 30, 2021

( 275,167,476

Nine Months Ended September 30, 2020

Non-controlling

December 31, 2019

( 250,322,307

Share-based compensation

Fair value of warrants issue

Common stock issued

Debt modification

September 30, 2020

March 31, 2021

( 268,854,680

The accompanying notes are an integral part of these consolidated financial statements.

The accompanying notes are an integral part of these condensed consolidated financial statements.

ODYSSEY MARINE EXPLORATION, INC.

AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS - Unaudited

Nine Months Ended

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS – Unaudited

Three Months Ended

CASH FLOWS FROM OPERATING ACTIVITIES:

Net loss before non-controlling

Adjustments to reconcile net loss to net cash (used) by operating activities:

Adjustments to reconcile net loss to net cash (used) in

operating activities:

Investment in unconsolidated entity

Depreciation and amortization

Financed lender fee amortization

Financing fees amortization

Loan payable prepayment premium

Note payable interest accretion

Right of use amortization

Right of use asset amortization

Share-based compensation

Loss (gain) on debt forgiveness

Change in hybrid-instrument fair value

Deferred income

(Increase) decrease in:

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Accrued expenses and other

NET CASH (USED) BY OPERATING ACTIVITIES

NET CASH USED IN OPERATING ACTIVITIES

CASH FLOWS FROM INVESTING ACTIVITIES:

Purchase of property and equipment

NET CASH (USED) PROVIDED BY INVESTING ACTIVITIES

NET CASH USED IN INVESTING ACTIVITIES

CASH FLOWS FROM FINANCING ACTIVITIES:

Proceeds from issuance of notes payable

Operating lease liability reduction

Offering costs paid on sale of common stock

Common stock sale net proceeds

Sale of subsidiary equity

Proceeds from issuance of loans payable

Payment of operating lease liability

Proceeds from sale of equity of subsidiary

Payment of debt obligation

NET CASH (USED) PROVIDED BY FINANCING ACTIVITIES

NET INCREASE (DECREASE) IN CASH

CASH AT BEGINNING OF PERIOD

CASH AT END OF PERIOD

Repurchase of stock-based awards withheld for payment of withholding tax requirements

NET CASH PROVIDED BY FINANCING ACTIVITIES

NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS

CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD

CASH AND CASH EQUIVALENTS AT END OF PERIOD

SUPPLEMENTARY INFORMATION:

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Income taxes paid

TRANSACTIONS:

INVESTING AND FINANCING TRANSACTIONS:

Director compensation settled with equity

Convertible debt exchanged for equity

Gain on debt forgiveness

During the nine

months ended September 30, 2020, we received $ 3,281,461 in non-cash

financing pertaining to our litigation financing as described in Note I:

Note 9 – Litigation financing.

The funder settled a portion of the Company’s litigation payables directly with the vendor.

Related to this financing, we recorded a debt discount of $ 1,063,811 and a corresponding increase to additional paid in capital for the fair value of certain warrants that were issued to the funder.

We also incurred $ 200,000 of funder financed debt fees with this financing.

During the nine months ended September 30, 2021, we received $ 3,146,896 in non-cash

financing associated with our litigation financing as described in Note I:

Note 9 – Litigation financing.

The funder paid this amount directly to vendors used in our NAFTA litigation support.

Accrued interest settled with common stock

During the three months ended March 31, 2022 and 2021, we received $ 706,048 and $ 577,539 , respectively, in non-cash

financing associated with our litigation financing as described in Note H – Litigation financing.

The funder paid this amount directly to vendors used in our North American Free Trade Agreement (“NAFTA”) litigation support.

On March 30, 2021, Epsilon Acquisitions LLC converted indebtedness of $ 1,448,697 at an exercise price of $ 3.52 into 411,562 shares of our common stock.

On July 12, 2021, certain creditors converted $ 1,325,582 of our convertible indebtedness held by them into 283,850 shares of our common stock at a conversion ratio of $ 4.67 per share.

The accompanying notes are an integral part of these consolidated financial statements.

The accompanying notes are an integral part of these condensed consolidated financial statements.

ODYSSEY MARINE EXPLORATION, INC.

AND SUBSIDIARIES

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE A – BASIS OF PRESENTATION

The accompanying unaudited consolidated financial statements of Odyssey Marine Exploration, Inc.

The accompanying unaudited condensed consolidated financial statements of Odyssey Marine Exploration, Inc.

and subsidiaries (the “Company,” “Odyssey,” “us,” “we” or “our”) have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission and the instructions to Form 10-Q

and, therefore, do not include all information and footnotes normally included in financial statements prepared in accordance with generally accepted accounting principles.

These interim consolidated financial statements should be read in conjunction with the consolidated financial statements and notes included in the Company’s Annual Report on Form 10-K

These interim condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes included in the Company’s Annual Report on Form 10-K

for the year ended December 31, 2021.

In the opinion of management, these financial statements reflect all adjustments, including normal recurring adjustments, necessary for a fair presentation of the financial position as of September 30, 2021 and the results of operations and cash flows for the interim periods presented.

Operating results for the three and nine-month periods ended September 30, 2021, are not necessarily indicative of the results that may be expected for the full year.

Accounting standards not yet applied

In the opinion of management, these financial statements reflect all adjustments, including normal recurring adjustments, necessary for a fair presentation of the financial position as of March 31, 2022 and the results of operations and cash flows for the interim periods presented.

Operating results for the three month period ended March 31, 2022, are

not necessarily indicative of the results that may be expected for the full year.

Accounting standards adopted

In August 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No.

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and Derivatives and Hedging-Contracts in Entity’s Own Equity (Subtopic 815-40).

The amendments in the update are effective for public business entities that meet the definition of a Securities and Exchange Commission (SEC) filer, excluding entities eligible to be smaller reporting companies as defined by the SEC, for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years.

The amendments in this update are effective for public business entities that meet the definition of a Securities and Exchange Commission (“SEC”) filer, excluding entities eligible to be smaller reporting companies as defined by the SEC, for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years.

For all other entities, the amendments are effective for fiscal years beginning after December 15, 2023, including interim periods within those fiscal years.

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The FASB specified that an entity should adopt the guidance as of the beginning of its annual fiscal year.

The amendments in ASU No.

The amendments in ASU

affect entities that issue convertible instruments and/or contracts in an entity’s own equity.

For convertible instruments, the instruments primarily affected are those issued with beneficial conversion features or cash conversion features because the accounting models for those specific features are removed.

However, all entities that issue convertible instruments are affected by the amendments to the disclosure requirements in the update.

However, all entities that issue convertible instruments are affected by the amendments to the disclosure requirements in this update.

For contracts in an entity’s own equity, the contracts primarily affected are freestanding instruments and embedded features that are accounted for as derivatives under the current guidance because of failure to meet the settlement conditions of the derivatives scope exception related to certain requirements of the settlement assessment.

The FASB simplified the settlement assessment by removing the requirements (1) to consider whether the contract would be settled in registered shares, (2) to consider whether collateral is required to be posted, and (3) to assess shareholder rights.

The FASB simplified the settlement assessment by removing the requirements

(1) to consider whether the contract would be settled in registered shares,

(2) to consider whether collateral is required to be posted, and

(3) to assess shareholder rights.

Those amendments also affect the assessment of whether an embedded conversion feature in a convertible instrument qualifies for the derivatives scope exception.

Additionally, the amendments in the update affect the diluted EPS calculation for instruments that may be settled in cash or shares and for convertible instruments.

The Company has not elected early adoption of this ASU No.

at this time.

Additionally, the amendments in this update affect the diluted EPS calculation for instruments that may be settled in cash or shares and for convertible instruments.

We adopted this ASU as of January

On October 31, 2018, the SEC adopted a final rule (“New Final Rule”) that will replace SEC Industry Guide 7 with new disclosure requirements that are more closely aligned with current industry and global regulatory practices and standards, including NI 43-101.

Companies must comply with the New Final Rule for the company’s annual filing for first fiscal year beginning on or after January 1, 2021.

Although early voluntary compliance with the New Final Rule was permitted, the Company did not elect early adoption of the New Final Rule.

The Company is in the process of implementing the New Final Rule.

The FASB recently issued ASU 2021-04

to codify the final consensus reached by the Emerging Issues Task Force (EITF) on how an issuer should account for modifications made to equity-classified written call options (hereafter referred to as a warrant to purchase the issuer’s common stock).

The guidance in the ASU requires the issuer to treat a modification of an equity-classified warrant that does not cause the warrant to become liability-classified as an exchange of the original warrant for a new warrant.

This guidance applies whether the modification is structured as an amendment to the terms and conditions of the original warrant or as a termination of the original warrant and issuance of a new warrant.

The guidance is effective for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years.

Early application is permitted, including in an interim period as of the beginning of the fiscal year that includes that interim period.

The Company has not elected early adoption of this ASU.

Companies must comply with the New Final Rule for the company’s first fiscal year beginning on or after January 1, 2021.

We adopted this New Final Rule on January 1, 2021.

Other recent accounting pronouncements issued by the FASB, the AICPA and the SEC did not or are not believed by management to have a material effect, if any, on the Company’s financial statements.

NOTE B – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

This summary of significant accounting policies of the Company is presented to assist in understanding our consolidated financial statements.

This summary of significant accounting policies of the Company is presented to assist in understanding our condensed consolidated financial statements.

The financial statements and notes are representations of the Company’s management who are responsible for their integrity and objectivity and have prepared them in accordance with our customary accounting practices.

Principles of Consolidation

The consolidated financial statements include the accounts of the Company and its direct and indirect wholly owned subsidiaries, both domestic and international.

The condensed consolidated financial statements include the accounts of the Company and its direct and indirect wholly owned subsidiaries, both domestic and international.

Equity investments in which we exercise significant influence but do not control and of which we are not the primary beneficiary are accounted for using the equity method.

All significant inter-company and intra-company transactions and balances have been eliminated.

The results of operations attributable to the non-controlling

The results of operations attributable to the

non-controlling

interest are presented within equity and net income and are shown separately from the Company’s equity and net income attributable to the Company.

Some of the existing inter-company balances, which are eliminated upon consolidation, include features allowing the liability to be converted into equity of a subsidiary, which if exercised, could increase the direct or indirect interest of the Company in the non-wholly

owned subsidiaries.

Use of Estimates

Management uses estimates and assumptions in preparing these consolidated financial statements in accordance with U.S.

Management uses estimates and assumptions in preparing these condensed consolidated financial statements in accordance with U.S.

Those estimates and assumptions affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities, and the reported revenues and expenses.

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Reclassifications

Certain reclassifications have been made to the 2020 consolidated financial statements in order to conform to the classifications used in 2021.

Certain reclassifications have been made to the 2021 condensed consolidated financial statements in order to conform to the classifications used in 2022.

The reclassifications had no impact to operations or working capital.

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Revenue is recognized when a customer obtains control of promised goods or services, in an amount that reflects the consideration which the Company expects to receive in exchange for those goods or services.

To determine revenue recognition for arrangements that the Company determines are within the scope of ASC Topic 606, the Company performs the following five steps:

To determine revenue recognition for arrangements that the Company determines are within the scope of Accounting Standards Codification (“ASC”) Topic 606, the Company performs the following five steps:

(i) identify the contract(s) with a customer;

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The Company follows the guidance pursuant to ASU 350, “ Intangibles-Goodwill and Other

” in accounting for its Exploration License (see NOTE E).

” in accounting for its Exploration License.

Management determined the rights to use the license to have an indefinite life.

This assessment is based on the historical success of renewing the license since 2006, and the fact that management believes there are no legal, regulatory, or contractual provisions that would limit the useful life of the asset.

This assessment is based on the historical success of renewing the license every two years since 2006, and the fact that management believes there are no legal, regulatory, or contractual provisions that would limit the useful life of the asset.

The exploration license is not dependent on another asset or group of assets that could potentially limit the useful life of the exploration license.

In the future, the recoverability of the license will be tested whenever circumstances indicate that its carrying amount may not be recoverable per the guidance of the Accounting Standards Codification (“ASC”) for topic 360 for Property, Plant and Equipment .

In the future, the recoverability of the license will be tested whenever circumstances indicate that its carrying amount may not be recoverable per the guidance of the ASC topic 360 for Property, Plant and Equipment .

We did no t have any impairments for the three months ended March 31, 2022 and 2021, respectively.

Long-Lived Assets

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Impairment losses are included in depreciation at the time of impairment.

We did not have any impairments in 2021 or 2020.

We did not have any impairments for the three months ended March 31, 2022 and 2021, respectively.

Property and Equipment and Depreciation

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Basic earnings per share (“EPS”) is computed by dividing income available to common stockholders by the weighted-average number of common shares outstanding for the period.

In periods when the Company has income, the Company would calculate basic earnings per share using the two-class

method, if required, pursuant to ASC 260 Earnings Per Share.

The two-class

method was required effective with the issuance of certain senior convertible notes in the past because these notes qualified as a participating security, giving the holder the right to receive dividends should dividends be declared on common stock.

Under the two-class

method, earnings for a period are allocated on a pro rata basis to the common stockholders and to the holders of convertible notes based on the weighted average number of common shares outstanding and number of shares that could be issued upon conversion.

The Company does not use the two-class

method in periods when it generates a loss because the holder of the convertible notes does not participate in losses.

Currently, we do not have any outstanding convertible notes that qualify as a participating security.

Diluted EPS reflects the potential dilution that would occur if dilutive securities and other contracts to issue common stock were exercised or converted into common stock or resulted in the issuance of common stock that then shared in our earnings.

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method to compute potential common shares from stock options, restricted stock units, warrants, preferred stock, convertible notes or other convertible securities.

For diluted earnings per share, the Company uses the more dilutive of the if-converted

method or two-class

When a net loss occurs, potential common shares have an anti-dilutive effect on earnings per share and such shares are excluded from the diluted EPS calculation.

For the nine months ended September 30, 2021 and 2020, the weighted average common shares outstanding year-to-date

For the three months ended March 31, 2022 and 2021, the weighted average common shares outstanding year-to-date

were 14,365,633 and 12,610,924 , respectively.

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Three Months Ended

Nine Months Ended

September 30,

Average market price during the period

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Three Months Ended

Nine Months Ended

exercise price

September 30,

Out of the money options excluded:

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Total excluded

The common shares relating to our unvested restricted stock awards that were excluded from potential common shares in the earning per share calculation due to having an anti-dilutive effect are:

The equivalent common shares relating to our unvested restricted stock awards that were excluded from potential common shares in the earning per share calculation due to having an anti-dilutive effect are:

Three Months Ended

Nine Months Ended

September 30,

Potential common shares from unvested restricted stock awards excluded from EPS

Excluded unvested restricted stock awards

The following is a reconciliation of the numerators and denominators used in computing basic and diluted net income per share:

Three Months Ended

Nine Months Ended

September 30,

Net income (loss)

Numerator, basic and diluted net income (loss) available to stockholders

Numerator, basic and diluted net loss available to stockholders

Shares used in computation – basic:

Weighted average common shares outstanding

Common shares outstanding for basic

Shares used in computation – diluted:

Common shares outstanding for basic

Shares used in computing diluted net income per share

Net (loss) per share – basic

Net (loss) per share – diluted

Weighted average common shares outstanding

Net loss per share – basic and diluted

Income taxes are accounted for using an asset and liability approach that requires the recognition of deferred tax assets and liabilities for the expected future tax consequences attributable to differences between financial statement carrying amounts of existing assets and liabilities and their respective tax bases.

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Our stock-based compensation is recorded in accordance with the guidance in the ASC topic for Stock-Based Compensation

(See NOTE J).

(See NOTE I).

Fair Value of Financial Instruments

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broker quotes that we were unable to corroborate with observable market data.

At September 30, 2021 and December 31, 2020, the Company did no t have any financial instruments measured on a recurring basis.

Subsequent Events

We have evaluated subsequent events for recognition or disclosure through the date this Form 10-Q

is filed with the Securities and Exchange Commission (See Note M).

At March 31, 2022 and December 31, 2021, the Company did no t have any financial instruments measured on a recurring basis.

NOTE C – ACCOUNTS RECEIVABLE AND OTHER

Our accounts receivable consist of the following:

September 30, 2021

March 31, 2022

December 31, 2021

Related party

Related party (see Note D)

Total accounts receivable and other

We perform services for a deep-sea

mineral exploration company in which our past Chairman of the Board, Greg Stemm, has a controlling ownership interest (See NOTE D).

At September 30, 2021 and December 31, 2020, the company owed us $ 252,563 and $ 134,452 , respectively.

NOTE D – RELATED PARTY TRANSACTIONS

We currently provide services to a deep-sea

mineral exploration company, CIC, which was organized and is majority owned and controlled by Greg Stemm, Odyssey’s past Chairman of the Board.

mineral exploration company, CIC Limited (“CIC”), which was organized and is majority owned and controlled by Greg Stemm, Odyssey’s past Chairman of the Board.

Stemm’s involvement with this company was disclosed to, and approved by, the Odyssey Board of Directors and legal counsel pursuant to the terms of Mr.

Stemm’s consulting agreement at that time.

We are providing these services pursuant to a Master Services Agreement that provides for back-office services in exchange for a recurring monthly fee as well as other deep-sea

Stemm’s consulting agreement in effect at that time.

A current Odyssey director, Mark B.

Justh, made an investment into CIC’s parent company and indirectly owns approximately 11.5 % of CIC.

We expect Mr.

Justh to recuse himself from any decisions of the Board of Directors regarding CIC.

The Board of Directors made a determination that Mr.

Justh’s indirect ownership in CIC does not impair his independence under applicable rules.

We are providing these services to CIC pursuant to a Master Services Agreement that provides for back-office services in exchange for a recurring monthly fee as well as other deep-sea

mineral related services on a cost-plus profit basis and will be compensated for these services with a combination of cash and equity in CIC.

For the 2021 year to date, we invoiced CIC a total of $ 671,061 , which was for technical and support services.

For the three months ended March 31, 2022 and 2021, we invoiced CIC a total of $ 294,975 and $ 291,676 , respectively, which was for technical and support services.

We have the option to accept equity in payment of the amounts due from CIC.

See NOTE C for related accounts receivable at September 30, 2021 and December 31, 2020 and NOTE F for our investment in an unconsolidated entity.

See NOTE C for related accounts receivable at March 31, 2022 and December 31, 2021 and NOTE E for our investment in an unconsolidated entity.

The above terms and amounts are not necessarily indicative of the terms and amounts that would have been incurred had comparable transactions been entered into with independent parties.

NOTE E – EXPLORATION LICENSE

On July 9, 2019 we acquired a 79.9 % interest in Bismarck Mining Corporation (PNG) Limited (“Bismarck”), a Papua New Guinea company that was organized for the purpose of exploring the deep waters off the coast for precious metals.

We evaluated the transaction under ASU 2017-01

Business Combinations (Topic 805) and determined that Bismarck did not meet the definition of a business, so the transaction represented an acquisition of assets rather than a business combination.

Asset acquisitions do not give rise to goodwill.

Rather, the sum of the fair value of the consideration given, together with transaction costs is allocated to the individual assets acquired and liabilities assumed based on their relative fair values which were more clearly evident and, thus, more reliably measurable at the date of acquisition under ASC 805-50-30-2

Initial Measurement

In the future, the recoverability will be tested whenever events or changes in circumstances indicate that its carrying amount may not be recoverable per the guidance of ASC 360-10-35-21

Subsequent Measurement.

Management has considered whether any triggering events occurred that would cause impairment.

Management did not identify any triggering events thus there is no impairment for the nine-month period ended September 30, 2021.

The consideration paid for the asset acquisition consisted of the following:

Fair value of 249,584 common shares issued

Direct transaction costs

Total consideration paid

The consideration was allocated as follows:

Intangible asset- exploration license rights

Current assets

Current liabilities

Non-controlling

Total net assets acquired

Included in this acquisition are the rights to Bismarck’s exploration license, which is renewable every two years.

Per ASC 350-30-35-3,

management has deemed the rights to this license to have an indefinite life.

Determining if the rights to the license has an indefinite or finite life required us to consider the nature of the renewal process and any additional economic factors, if any, required when renewing this license.

We currently expect to use and renew the related license indefinitely, and we do not believe there are currently any legal, regulatory, or contractual provisions that are expected to limit the useful life of the related exploration license or indicate that the useful life is other than indefinite.

The exploration license is also not dependent on, or specifically associated with, another asset or group of assets that would limit the useful life of the intangible asset or indicate that the useful life is other than indefinite.

Management’s assumptions regarding our ability to successfully renew or extend the exploration license are based on Bismarck’s historical experience.

Bismarck was established in 2006, and they have historically renewed and extended

the exploration license without a lapse in their ability to use the license.

The license has also never been revoked.

We will not incur significant maintenance costs related to the license.

There is an annual fee due of approximately $ 14,000 to maintain the license.

This amount is much less than the carrying amount of the license and the cost is not expected to prohibit continued renewals of the license in the future.

Based on all the factors considered above, management believes it is appropriate to assign indefinite useful life to the acquisition of the rights for the exploration license.

NOTE F – INVESTMENTS IN UNCONSOLIDATED ENTITIES

Neptune Minerals, Inc.

Our current investment in NMI consists of 3,092,488 Class B Common non-voting

shares and 2,612 Series A Preferred non-voting

These preferred shares are convertible into an aggregate of 261,200 shares of Class B non-voting

Our holdings now constitute an approximate 14 % ownership in NMI.

Our estimated share of unrecognized NMI equity-method losses is approximately $ 21.3 million.

We have not recognized the accumulated $21.3 million in our income statement because these losses exceeded our investment in NMI.

Our investment has a carrying value of zero as a result of the recognition of our share of prior losses incurred by NMI under the equity method of accounting.

We believe it is appropriate to allocate this loss carryforward of $21.3 million to any incremental NMI investment that may be recognized on our balance sheet in excess of zero because the losses occurred when they were an equity-method investment.

The aforementioned loss carryforward is based on NMI’s last unaudited financial statements as of December 31, 2016.

We do not believe losses NMI may have incurred from the calendar year of 2017 to current day to be material.

We do not have any financial obligations to NMI, and we are not committed to provide financial support to NMI.

Although we are a shareholder of NMI, we have no representation on the board of directors or in management of NMI and do not hold any Class A voting shares.

We are not involved in the management of NMI, nor do we participate in their policy-making.

Accordingly, we are not the primary beneficiary of NMI.

As of September 30, 2021, the net carrying value of our investment in NMI

was zero in our consolidated financial statements.

Chatham Rock Phosphate, Limited.

During 2012, we performed deep-sea

mining exploratory services for Chatham Rock Phosphate, Ltd.

(“CRP”) valued at $ 1,680,000 .

As payment for these services, CRP issued 9,320,348 ordinary shares to us.

During March 2017, Antipodes Gold Limited completed the acquisition of CRP.

The surviving entity is now named Chatham Rock Phosphate Limited (“CRPL”).

In exchange for our 9,320,348 shares of CRP we received 141,884 shares of CPRL, which represents equity ownership of approximately 1 % of the surviving entity.

Since CRP was a thinly traded stock and pursuant to guidance per ASC 320:

Debt and Equity Securities

regarding readily determinable fair value, we believe it was appropriate to not recognize this amount as an asset nor as revenue during that period.

We continue to carry the value of our investment in CPRL at zero in our consolidated financial statements.

In 2018, we began providing services to CIC LTD

(see NOTE D).

This company is pursuing deep water exploration permits in foreign waters.

Due to the initial structure of the company, we determined this venture to be a variable interest entity (VIE) consistent with ASU 2015-2.

We have determined we are not the primary beneficiary of the VIE and, therefore, we have not consolidated this entity.

Additionally, we also will record the investment under the cost method as we have determined we do not exercise significant influence over the entity.

We will assess our investment for impairment annually and, if a loss in value is deemed other than temporary, an impairment charge will be recorded.

At September 30, 2021 and December 31, 2020, the accumulated investment in the entity was $ 3,005,867 and $ 2,370,794 , respectively, which is classified as an investment in unconsolidated entity in our consolidated balance sheets.

We reviewed the following items to assist in determining CIC LTD’s composition.

We account for the investments we make in certain legal entities in which equity investors do not have (1) sufficient equity at risk for the legal entity to finance its activities without additional subordinated financial support, or (2) as a group, the holders of the equity investment at risk do not have either the power, through voting or similar rights, to direct the activities of the legal entity that most significantly impact the entity’s economic performance, or (3) the obligation to absorb the expected losses of the legal entity or the right to receive expected residual returns of the legal entity.

This type of legal entity is referred to as a VIE.

We would consolidate the results of any such entity in which we determined we had a controlling financial interest.

We would have a “controlling financial interest” in such an entity if we had both the power to direct the activities that most significantly affect the VIE’s economic performance and the obligation to absorb the losses of, or right to receive benefits from, the VIE that could be potentially significant to the VIE.

On a quarterly basis, we reassess whether we have a controlling financial interest in our investments we have in these legal entities.

We determine whether any of the entities in which we have made investments is a VIE at the start of each new venture and if a reconsideration event has occurred.

At such times, we also consider whether we must consolidate a VIE and/or disclose information about our involvement in a VIE.

A reporting entity must consolidate a VIE if that reporting entity has a variable interest (or combination of variable interests) that will absorb a majority of the VIE’s expected losses, receive a majority of the VIE’s expected residual returns, or both.

A reporting entity must consider the rights and obligations conveyed by its variable interests and the relationship of its variable interests with variable interests held by other parties to determine whether its variable interests will absorb a majority of a VIE’s expected losses, receive a majority of the VIE’s expected residual returns, or both.

The reporting entity that consolidates a VIE is called the primary beneficiary of that VIE.

NOTE G - INCOME TAXES

During the nine-month period ended September 30, 2021, we generated a federal net operating loss (“NOL”) carryforward of $ 11.6 million.

As of September 30, 2021, we had consolidated income tax NOL carryforwards for federal tax purposes of approximately $ 208 million and net operating loss carryforwards for foreign income tax purposes of approximately $ 66.8 million.

The federal NOL carryforwards from 2005 - 2017

will expire in various years beginning in 2025 and ending through the year 2038 .

Losses generated in 2018 and forward will not expire.

Deferred income tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between financial statement carrying amounts of existing assets and liabilities and their respective tax bases.

Deferred income tax assets and liabilities are measured using enacted tax rates expected to be recovered or settled.

We have recorded a net deferred tax asset of $ 0 at September 30, 2021.

As required by the Accounting for Income Taxes

topic in the ASC, we have concluded it is more likely than not that those assets would not be realizable without the recovery and rights of ownership or salvage rights of high value shipwrecks or substantial profits from our mining operations and thus a valuation allowance has been recorded as of September 30, 2021.

There was no U.S.

income tax expense for the nine

months ended September 30, 2021 due to the generation of net operating losses.

The increase in the valuation allowance as of September 30, 2021 is due to the generation of approximately $ 11.6 million in net operating loss year-to-date.

The change in the valuation allowance is as follows:

September 30,

December 31, 2020

Change in valuation allowance

Our estimated annual effective tax rate before the valuation allowance as of September 30, 2021 is 7.976 % while our September 30, 2021 effective tax rate is 0.0 % because of the full valuation allowance.

We have not recognized a material adjustment in the liability for unrecognized tax benefits and have not recorded any provisions for accrued interest and penalties related to uncertain tax positions.

The earliest tax year still subject to examination by a major taxing jurisdiction is 2017.

NOTE H – COMMITMENTS AND CONTINGENCIES

NOTE E – INVESTMENT IN UNCONSOLIDATED ENTITY

At March 31, 2022 and December 31, 2021, our accumulated investment in CIC was

$ 3,548,925 and

$ 3,253,950 ,

respectively, which is classified as an investment in unconsolidated entity in our condensed consolidated balance sheets.

NOTE F – INCOME TAXES

During the three month period ended March 31, 2022, we generated a federal net operating loss (“NOL”) carryforward of

$ 8.6 million

and generated $ 3.9 million of foreign NOL carryforwards.

As of March 31, 2022, we had consolidated income tax NOL carryforwards for federal tax purposes of

approximately

217.4 million and net operating loss carryforwards for foreign income tax purposes of approximately

$ 78.9 million

The federal NOL carryforwards from 2005 will expire in various years beginning

ending through the

From 2025 through 2027, approximately $ 47 million of the NOL will expire, and from 2028 through 2037, approximately $ 128 million of the NOL will expire.

The NOL generated in 2018 through 2021 of approximately $ 42.4 M will be carried forward indefinitely.

NOTE G – COMMITMENTS AND CONTINGENCIES

Legal Proceedings

The Company may be subject to a variety of claims and suits that arise from time to time in the ordinary course of business.

We are not a party to any litigation as a defendant where a loss contingency is required to be reflected in our consolidated financial statements.

We are not a party to any litigation as a defendant where a loss contingency is required to be reflected in our condensed consolidated financial statements.

During March 2016, our Board of Directors approved the grant and issuance of 3.0 million new equity shares of Oceanica Resources, S.R.L.

4 unchanged sentences

The EIA has not been approved as of the date of this report.

The Company expects to receive a payment upon the settlement of a legal matter related to a previously completed shipwreck recovery.

A final settlement is expected in 2021 and the Company estimates the net proceeds retained by Odyssey would exceed

$ 3.0 million.

ASC 450 Contingencies

states gain contingencies are recorded when the underlying uncertainty has been settled and the asset has been realized.

Accordingly, no amount has been recorded for the nine-month period ended September 30, 2021.

Although the Company expects the settlement in 2021, no assurances can be provided as to the timing and amount of the proceeds.

Going Concern

Consideration

Going Concern Consideration

We have experienced several years of net losses and may continue to do so.

Our ability to generate net income or positive cash flows for the following twelve months is dependent upon financings, our success in developing and monetizing our interests in mineral exploration entities, generating income from exploration charters, collecting on amounts owed to us, or completing the MINOSA/Penelope equity financing transaction approved by our stockholders on June 9, 2015.

Our 2022 business plan requires us to generate new cash inflows to effectively allow us to perform our planned projects.

2 unchanged sentences

On August 21, 2020, we sold an aggregate of 2,553,314 shares of our common stock and warrants to purchase up to 1,901,985 shares of our common stock.

The net proceeds received from this sale, after offering expenses of $ 0.3 million, were $ 11.3 million (See NOTE J).

These proceeds, coupled with other anticipated cash inflows, are expected to provide operating funds through early 2022.

The net proceeds received from this sale, after offering expenses of $ 0.3 million, were $ 11.3 million.

These proceeds, coupled with other anticipated cash inflows, are expected to provide operating funds through 2022.

On March 11, 2015, we entered into a Stock Purchase Agreement with Minera del Norte S.A.

2 unchanged sentences

Our consolidated non-restricted

cash balance at September 30, 2021 was $ 3.5 million.

We have a working capital deficit at September 30, 2021 of $ 57.2 million.

In the fourth quarter of 2021, we executed a Termination and Settlement Agreement with Monaco and SMOM that removed approximately $ 14.5 million of indebtedness from our balance sheet (see NOTE M).

Our largest loan of $ 14.75 million from MINOSA had a due date of December 31, 2017 which is now linked to other stipulations, see NOTE I for further detail.

The majority of our remaining assets have been pledged to MINOSA, and its affiliates, and to Monaco Financial LLC, leaving us with few opportunities to raise additional funds from our balance sheet.

The total consolidated book value of our assets was approximately $ 9.4 million at September 30, 2021, which includes cash of $ 3.5 million.

The fair market value of these assets may differ from their net carrying book value.

cash balance at March 31, 2022 was $ 2.1 million.

We have a working capital deficit at March 31, 2022 of $ 58.5 million.

The majority of our remaining assets have been pledged to MINOSA, leaving us with few opportunities to raise additional funds from our balance sheet.

The total consolidated book value of our assets was approximately $ 9.0 million at March 31, 2022, which includes cash of $ 2.1 million.

Even though we executed the above noted financing arrangement with Penelope, Penelope must purchase the shares for us to be able to complete the equity component of the transaction.

The Penelope equity transaction is heavily dependent on the outcome of our subsidiary’s application approval process for an environmental permit (EIA) to commercially develop a mineralized phosphate deposit off the coast of Mexico.

The Penelope equity transaction is heavily dependent on the outcome of our subsidiary’s application approval process for an EIA to commercially develop a mineralized phosphate deposit off the coast of Mexico.

The factors noted above raise doubt about our ability to continue as a going concern.

These consolidated financial statements do not include any adjustments to the amounts and classification of assets and liabilities that may be necessary should we be unable to continue as a going concern.

These condensed consolidated financial statements do not include any adjustments to the amounts and classification of assets and liabilities that may be necessary should we be unable to continue as a going concern.

Lease commitment

In August 2019, we entered into an operating lease for our corporate office space under a non-cancellable

lease through August 2024 with monthly payments ranging from $ 11,789 to $ 13,269 , not including sales tax.

The lease provides for annual increases of base rent of 3 % until the expiration date.

Pursuant to ASC 842, an operating lease right of usage (ROU) asset and liability were recognized in the amount of $ 590,612 at inception of the lease based on the present value of lease payments over the remaining lease term.

The ROU asset represents the Company’s right to use the underlying office space asset for the lease term, and the lease liability represents the Company’s obligation to make lease payments arising from the lease.

Since the implicit rate of interest in the arrangement was not readily determinable, we utilized our incremental borrowing rate of 10 % in determining the present value of lease payments.

The operating lease ROU asset includes any lease payments made and excludes lease incentives.

At September 30, 2021, the ROU asset and lease obligation were, $ 366,862 and $ 380,134 , respectively.

At March 31, 2022, the right of usage (“ROU”) asset and lease obligation for our corporate office operating lease were, $ 309,579 and $ 322,916 , respectively.

The remaining lease payment obligations are as follows:

Year ending December 31,

Annual payment

During the third quarter of 2019, we entered into a five-year lease at the location of our corporate office space in Tampa, Florida to support our marine operations.

The lease was effective October 1, 2019 and has monthly lease payments ranging from $ 4,040 to $ 4,547 , not including sales tax, over the five-year term.

We are accounting for this lease under ASC 842 which resulted in a right of use asset and lease obligation of $ 202,424 .

The discount used in determining the right of use asset was 10 %.

At September 30, 2021, the ROU asset and lease obligation were, $ 132,068 and $ 136,609 , respectively.

At March 31, 2022, the ROU asset and lease obligation for our marine operations operating lease were, $ 112,757 and $ 117,321 , respectively.

The remaining lease payment obligations are as follows:

Year ending December 31,

Annual payment

We have recognized approximately $ 41,000 and $ 54,000 in rent expense associated with these leases for the three-month periods ended September 30, 2021 and 2020, respectively and approximately $ 122,000 and $ 162,000 in rent expense for the nine-month periods ended September 30, 2021 and 2020, respectively.

NOTE I –LOANS PAYABLE

The Company’s consolidated notes payable consisted of the following carrying values at:

September 30,

Note 1 – Monaco 2014

Note 2 – Monaco 2016

Note 3 – MINOSA 1

Note 4 – Epsilon

Note 5 – SMOM

Note 6 – MINOSA 2

Note 7 – Monaco 2018

Note 8 – Promissory note

Note 9 – Litigation financing

Note 10 – Payroll Protection Program

Note 11 – Emergency Injury Disaster Loan

Note 12 – Vendor note payable

Note 1 – Monaco 2014

On August 14, 2014, we entered into a Loan Agreement with Monaco Financial, LLC (“Monaco”), a strategic marketing partner, pursuant to which Monaco agreed to lend us up to $ 10.0 million.

n was issued in three tranches:

(i) $ 5.0 million (the “First Tranche”) was advanced upon execution of the Loan Agreement;

(ii) $ 2.5 million (the “Second Tranche”) was advanced on October 1, 2014;

and (iii) $ 2.5 million (the “Third Tranche”) was advanced on December 1, 2014.

The Notes bear interest at a rate equal to 11 % per annum.

The Notes also contain an option whereby Monaco can purchase shares of Oceanica held by Odyssey (the “Share Purchase Option”) at a purchase price that is the lower of (a) $ 3.15 per share or (b) the price per share of a contemplated equity offering of Oceanica which totals $ 1.0 million or more in the aggregate.

The share purchase option was not clearly and closely related to the host debt agreement and required bifurcation.

On December 10, 2015, these promissory notes were amended as part of the asset acquisition agreement with Monaco (See NOTE R in our Form 10-K

filed with the Securities and Exchange Commission for the period ended December 31, 2017 for further information).

The amendment included the following material changes:

(i) $ 2.2 million of the indebtedness represented by the Notes was extinguished, (ii) $ 5.0 million of the indebtedness represented by the Notes ceased to bear interest and is only repayable under certain circumstances from certain sources of cash, and (iii) the maturity date on the Notes was extended to December 31, 2017 .

During March 2016, the maturity date was further extended to April 1, 2018 and the exercise price of the Share Purchase Option was re-priced

to $ 1.00 per share.

In October 2018, the parties executed a Forbearance Agreement that extended the period of this Share Purchase Option to a period of one year after this indebtedness is repaid in full.

This indebtedness has matured, but Monaco has not demanded payment because we are in negotiations with Monaco.

As of the maturity date, the interest rate was adjusted to the default rate of 18 % per annum.

See “Loan Modification (March 2016)” below.

For the three months ended September 30, 2021 and 2020 interest expense in the amount of $ 144,455 and $ 144,455 , respectively, was recorded.

For the nine months ended September 30, 2021 and 2020 interest expense in the amount of $ 428,656 and $ 430,225 , respectively, was recorded.

The outstanding interest-bearing balance of these Notes was $ 2.8 million at September 30, 2021 and December 31, 2020, respectively.

On October 4, 2021 we entered into a Termination and Settlement agreement with Monaco that cancelled the entire indebtedness of approximately

million of principal and accrued interest related to this arrangement.

See NOTE – M SUBSEQUENT EVENT below.

Note 2 – Monaco 2016

In March 2016, Monaco agreed to lend us an additional $ 1,825,000 .

These loan proceeds were received in full during the first quarter of 2016.

The indebtedness bears interest at 10.0 % percent per year.

All principal and any unpaid interest were due on April 15, 2018 .

This indebtedness has matured, but Monaco has not demanded payment because we are in negotiations with Monaco.

As of the maturity date, the interest rate was adjusted to the default rate of 18 % per annum.

The current outstanding balance as of September 30, 2021 and December 31, 2020 was $ 1,175,000 .

The indebtedness is convertible at any time until the maturity date into shares of Oceanica held by us at a conversion price of $ 1.00 per share.

Pursuant to this loan and as security for the indebtedness, Monaco was granted a second priority security interest in (a) one-half

of the indebtedness evidenced by the Amended and Restated Consolidated Note and Guaranty, dated September 25, 2015 (the “ExO Note”), in the original principal amount of $ 18.0 million, issued by Exploraciones Oceanicas S.

to Oceanica Marine Operations, S.R.L.

(“OMO”), and all rights associated therewith (the “OMO Collateral”);

and (b) all technology and assets in our possession or control used for offshore exploration, including an ROV system, deep-tow

search systems, winches, multi-beam sonar, and other equipment.

The carrying net book value of this equipment is less than $ 0.1 million.

We unconditionally and irrevocably guaranteed all obligations of ours and our subsidiaries to Monaco under this loan agreement.

As further consideration for the loan, Monaco was granted an option (the “Option”) to purchase the OMO Collateral.

The Option is exercisable at any time before the earlier of (a) the date that is 30 after the loan is paid in full or (b) the maturity date of the ExO Note, for aggregate consideration of $ 9.3 million, $ 1.8 million of which would be paid at the closing of the exercise of the Option, with the balance paid in ten monthly installments of $ 750,000 .

In October 2018, both parties executed a Forbearance Agreement that extended the Option’s 30 -

day period following a loan payoff to seven (7) months.

During 2017, we sold a marine vessel to a related party of Monaco for $ 650,000 .

The consideration for this vessel was applied against our loan balance to Monaco in the amount of $ 650,000 .

Accounting considerations

ASC 815 generally requires the analysis of embedded terms and features that have characteristics of derivatives to be evaluated for bifurcation and separate accounting in instances where their economic risks and characteristics are not clearly and closely related to the risks of the host contract.

The option to purchase the OMO Collateral is an embedded feature that is not clearly and closely related to the host debt agreement and thus requires bifurcation.

Because the option is out of the money, it has no material fair value as of the inception date or currently.

The debt agreement did not contain any additional embedded terms or features that have characteristics of derivatives.

However, we were required to consider whether the hybrid contract embodied a beneficial conversion feature (“BCF”).

The calculation of the effective conversion amount did result in a BCF because the effective conversion price was less than the market price on the date of issuance, therefore a BCF of $ 456,250 was recorded.

This BCF has been fully amortized as of March 31, 2018.

For the three months ended September 30, 2021 and 2020 interest expense in the amount of $ 67,454 and $ 67,454 , respectively, was recorded.

For the nine months ended September 30, 2021 and 2020 interest expense in the amount of $ 200,163 and $ 200,896 , respectively, was recorded.

Loan modification (December 2015)

In connection with the Acquisition Agreement entered into with Monaco on December 10, 2015, Monaco agreed to modify certain terms of the 2014 loans as partial consideration for the purchase of assets.

For the First Tranche ($ 5,000,000 advanced on August 14, 2014), Monaco agreed to cease interest as of December 10, 2015 and reduce the loan balance by (i) the cash or other value received from the SS Central America

shipwreck project (“SSCA”) or (ii) if the proceeds received from the SSCA project were insufficient to pay off the loan balance by December 31, 2017 , then Monaco could seek repayment of the remaining outstanding balance on the loan by withholding Odyssey’s 21.25 % “additional consideration” in new shipwreck projects performed for Monaco in the future.

For the Second Tranche ($ 2,500,000 advanced on October 1, 2014), Monaco agreed to reduce the principal amount by $ 2,200,000 leaving a new principal balance of $ 300,000 and extension of maturity to December 31, 2017 .

For the Third Tranche ($ 2,500,000 advanced on December 1, 2014), Monaco agreed to the extension of maturity to December 31, 2017 .

On December 10, 2015, the Monaco call option related to the Oceanica shares held by us was extended until December 31, 2017.

Loan modification (March 2016)

In connection with the $ 1.825 million loan agreement with Monaco in March 2016, the existing $ 2.8 million 2014 notes were modified.

Of the combined total indebtedness of Monaco’s Note 1 and Note 2, Monaco can convert this debt into 3,174,603 shares of Oceanica at a fixed conversion price of $ 1.00 per share, or $ 3,174,603 .

Any remaining debt in excess of $ 3,174,603 is not convertible.

, the modification eliminated Monaco’s option (“share purchase option”) to purchase 3,174,603 shares of Oceanica stock at a price of $ 3.15 per share.

The modification was analyzed under ASC 480 Distinguishing Liabilities from Equity

(“ASC 480”) to determine if extinguishment accounting was applicable.

Under ASC 470-50-40-10

a modification or an exchange that adds or eliminates a substantive conversion option as of the conversion date is always considered substantial and requires extinguishment accounting.

Since this modification added a substantive conversion option, extinguishment accounting is applicable.

In accordance with the extinguishment accounting guidance (a) the share purchase option was first marked to its pre-modification

fair value, (b) the new debt was recorded at fair value and (c) the old debt and share purchased option was removed.

The difference between the fair value of the new debt and the sum of the pre-modification

carrying amount of the old debt and the share purchase option’s fair value represented a gain on extinguishment.

ASC 470-50-40-2

indicates that debt restructuring with a related party may be in essence a capital transaction and as a result the gain of $ 1.2 million was recognized in additional paid in capital upon extinguishment.

On October 4, 2021 we entered into a Termination and Settlement agreement with Monaco that cancelled the entire indebtedness of approximately

million of principal and accrued interest related to this arrangement.

See NOTE – M SUBSEQUENT EVENT below.

Note 3 – MINOSA

On March 11, 2015, in connection with a Stock Purchase Agreement, Minera del Norte, S.A.

(“MINOSA”) agreed to lend us up to $ 14.75 million.

The entire $ 14.75 million was loaned in five advances from March 11 through June 30, 2015.

The outstanding indebtedness bears interest at 8.0 % percent per annum.

The Promissory Note was amended on April 10, 2015 and on October 1, 2015 so that, unless otherwise converted as provided in the Note, the adjusted principal balance shall be due and payable in full upon written demand by MINOSA;

provided that MINOSA agreed that it shall not demand payment of the adjusted principal balance earlier than the first to occur of:

(i) 30 days after the date on which (x) SEMARNAT makes a determination with respect to the current application for the Manifestacion de Impacto Ambiental relating to phosphate deposit project, which determination is other than an approval or (y) Odyssey Marine Enterprises or any of its affiliates withdraws such application without MINOSA’s prior written consent;

(ii) termination by Odyssey of the Stock Purchase Agreement, dated March 11, 2015 (the “Purchase Agreement”), among Odyssey, MINOSA, and Penelope Mining, LLC (the “Investor”);

(iii) the occurrence of an event of default under the Promissory Note;

(iv) December 31, 2015;

or (v) if and only if the Investor shall have terminated the Purchase Agreement pursuant to Section 8.1(d)(iii) thereof, March 30, 2016 .

This indebtedness is classified as short-term debt.

In connection with the loans, we granted MINOSA an option to purchase our 54 % interest in Oceanica for $ 40.0 million (the “Oceanica Call Option”).

On March 11, 2016 , the Oceanica Call has expired.

Completion of the transaction requires amending the Company’s articles of incorporation to (a) effect a reverse stock split, which was implemented on February 19, 2016, (b) adjusting the Company’s authorized capitalization, which was also implemented on February 19, 2016, and (c) establishing a classified board of directors (collectively, the “Amendments”).

The Amendments have been or will be set forth in certificates of amendment to the Company’s articles of incorporation filed or to be filed with the Nevada Secretary of State.

As collateral for the loan, we granted MINOSA a security interest in the Company’s 54 % interest in Oceanica.

The outstanding principal balance of this debt was $ 14.75 million at September 30, 2021 and December 31, 2020, respectively.

The maturity date of this indebtedness has been amended and matured on March 18, 2017 .

Per Note 6 MINOSA 2 below, the Minosa Purchase Agreement amended the due date of this note to a due date which may be no earlier than December 31, 2017, that is at least 60 days subsequent to written notice that Minosa intends to demand payment.

See Note 6 – MINOSA 2 for further qualifications.

During December 2017, MINOSA transferred this debt to its parent company.

For the three months ended September 30, 2021 and, 2020, interest expense in the amount of $ 297,424 and $ 297,424 , respectively, was recorded.

For the nine months ended September 30, 2021 and 2020 interest expense in the amount of $ 882,574 and $ 885,806 , respectively, was recorded.

Accounting considerations

We have accounted for this transaction as a financing transaction, wherein the net proceeds received were allocated to the financial instruments issued.

Prior to making the accounting allocation, we evaluated for proper classification under ASC 480 Distinguishing Liabilities from Equity

(“ASC 480”), ASC 815 Derivatives and Hedging

(“ASC 815”) and ASC 320 Property, Plant and Equipment

This debt agreement did not contain any embedded terms or features that have characteristics of derivatives.

The Oceanica Call Option is considered a freestanding financial instrument because it is both (i) legally detachable and (ii) separately exercisable.

The Oceanica Call Option did not fall under the guidance of ASC 480.

Additionally, it did not meet the definition of a derivative under ASC 815 because the option has a fixed value of $ 40.0 million and does not contain an underlying variable which is indicative of a derivative.

This instrument is considered an option contract for a sale of an asset.

The guidance applied in this case is ASC 360-20,

which provides that in situations when a party lends funds to a seller and is given an option to buy the property at a certain date in the future, the loan shall be recorded at its present value using market interest rates and any excess of the proceeds over that amount credited to an option deposit account.

If the option is exercised, the deposit shall be included as part of the sales proceeds;

if not exercised, it shall be credited to income in the period in which the option lapses.

Based on the previous conclusions, we allocated the cash proceeds first to the debt at its present value using a market rate of 15 %, which is management’s estimate of a market rate loan for the Company, with the residual allocated to the Oceanica Call Option, as follows:

Promissory Note

Deferred Income (Oceanica Call Option)

The call option amount of $ 383,148 represented a debt discount.

This discount has been fully accreted up to face value using the effective interest method.

Note 4 – Epsilon

On March 18, 2016 we entered into a Note Purchase Agreement (“Purchase Agreement”) with Epsilon Acquisitions LLC (“Epsilon”).

Pursuant to the Purchase Agreement, Epsilon loaned us $ 3.0 million in two installments of $ 1.5 million on March 31, 2016 and April 30, 2016.

The indebtedness bears interest at a rate of 10 % per annum and was due on March 18, 2017 .

We were also responsible for $ 50,000 of the lender’s out of pocket costs.

This amount is included in the loan balance.

In pledge agreements related to the loans, we granted security interests to Epsilon in (a) the 54 million cuotas (a unit of ownership under Panamanian law) of Oceanica Resources S.

(“Oceanica”) held by our wholly owned subsidiary, Odyssey Marine Enterprises, Ltd.

(“OME”), (b) all notes and other receivables from Oceanica and its subsidiary owed to the Odyssey Pledgors, and (c) all of the outstanding equity in OME.

Epsilon has the right to convert the outstanding indebtedness into shares of our common stock upon 75 days’ notice to us or upon a merger, consolidation, third party tender offer, or similar transaction relating to us at the conversion price of $ 5.00 per share, which represents the five-day

volume-weighted average price of Odyssey’s common stock for the five trading day period ending on March 17, 2016.

On January 25, 2017, Epsilon provided notice to us that it would convert the initial $ 3.0 million plus accrued interest per the Restated Note Purchase Agreement at $ 5.00 per share in accordance with the terms of the agreement.

The conversion and issuance of new shares was effective April 10, 2017 and included accrued interest of $ 302,274 for a total 670,455 shares.

Upon the occurrence and during the continuance of an event of default, the conversion price was to be reduced to $ 2.50 per share.

Following any conversion of the indebtedness, Penelope Mining LLC (an affiliate of Epsilon) (“Penelope”), may elect to reduce its commitment to purchase preferred stock of Odyssey under the Stock Purchase Agreement, dated as of March 11, 2015 (as amended, the “Stock Purchase Agreement”), among Odyssey, Penelope, and Minera del Norte, S.A.

(“MINOSA”) by the amount of indebtedness converted.

Pursuant to the Purchase Agreement (a) we agreed to waive our rights to terminate the Stock Purchase Agreement in accordance with the terms thereof until December 31, 2016, and (b) MINOSA agreed to extend, until March 18, 2017, the maturity date of the $ 14.75 million loan extended by MINOSA to OME pursuant to the Stock Purchase Agreement.

The indebtedness may be accelerated upon the occurrence of specified events of default including (a) OME’s failure to pay any amount payable on the date due and payable;

(b) OME or we fail to perform or observe any term, covenant, or agreement in the Purchase Agreement or the related documents, subject to a five-day

(c) an event of default or material breach by OME, us or any of our affiliates under any of the other loan documents shall have occurred and all grace periods, if any, applicable thereto shall have expired;

(d) the Stock Purchase Agreement shall have been terminated;

(e) specified dissolution, liquidation, insolvency, bankruptcy, reorganization, or similar cases or actions are commenced by or against OME or any of its subsidiaries, in specified circumstances unless dismissed or stayed within 60 days;

(f) the entry of judgment or award against OME or any of its subsidiaries in excess or $ 100,000 ;

and (g) a change in control (as defined in the Purchase Agreement) occurs.

In connection with the execution and delivery of the Purchase Agreement, we and Epsilon entered into a registration rights agreement pursuant to which we agreed to register new shares of our common stock with a formal registration statement with the Securities and Exchange Commission upon the conversion of the indebtedness.

Accounting considerations

We have accounted for this transaction as a financing transaction, wherein the net proceeds received were allocated to the financial instruments issued.

Prior to making the accounting allocation, we evaluated the transaction for proper classification under ASC 480 Distinguishing Liabilities from Equity

(“ASC 480”), ASC 815 Derivatives and Hedging

(“ASC 815”) and ASC 320 Property, Plant and Equipment

This debt agreement did not contain any embedded terms or features that have characteristics of derivatives.

However, we were required to consider whether the hybrid contract embodied a beneficial conversion feature (“BCF”).

The calculation of the effective conversion amount did result in a BCF because the effective conversion price was less than the Company’s stock price on the date of issuance, therefore a BCF of $ 96,000 was recorded.

The BCF represents a debt discount which was amortized over the life of the loan.

Loan modification (October 1, 2016)

On October 1, 2016 Odyssey Marine Enterprises, Ltd.

(“OME”), entered into an Amended and Restated Note Purchase Agreement (the “Restated Note Purchase Agreement”) with Epsilon Acquisitions LLC (“Epsilon”).

In connection with the existing $ 3.0 million loan agreement, Epsilon agreed to lend an additional $ 3.0 million evidenced by secured convertible promissory notes.

The convertible promissory notes bear an interest rate of 10.0 % per annum and are due and payable on March 18, 2017 .

Epsilon has the right to convert all amounts outstanding under the Restated Note into shares of our common stock upon 75 days’ notice to OME or upon a merger, consolidation, third party tender offer, or similar transaction relating to us at the applicable conversion price, which is (a) $ 5.00 per share with respect to the $ 3.0 million already advanced under the Restated Note and (b) with respect to additional advances under the Restated Note, the five-day

volume-weighted average price of our common stock for the five trading day period ending on the trading day immediately prior to the date on which OME submits a borrowing notice for such advance.

Notwithstanding anything herein to the contrary, we shall not issue any of our common stock upon conversion of any outstanding tranche (other than the first $3.0 million already advanced) under this Restated Note in excess of 1,388,769 shares of common stock.

The additional tranches were issued as follows:

(a) $ 1,000,000 (“Tranche 3”) was issued on October 16, 2016 with a conversion price of $ 3.52 per share;

(b) $ 1,000,000 (“Tranche 4”) was issued on November 15, 2016 with a conversion price of $ 4.19 per share;

and (c) $ 1,000,000 (“Tranche 5”) was issued on December 15, 2016 with a conversion price of $ 4.13 per share.

During 2017, Epsilon assigned Tranche 4 and 5 totaling $ 2,000,000 of this debt to MINOSA under the same terms as the original debt.

See Note – MINOSA 2 below for further detail.

On March 30, 2021, Epsilon converted the aggregate indebtedness related to Tranche 3 totaling $ 1,448,697 into 411,562 shares of our common stock at an exercise price of $ 3.52 per share.

As an inducement for the issuance of the additional $ 3.0 million of promissory notes, we also delivered to Epsilon a common stock purchase warrant (the “Warrant”) pursuant to which Epsilon has the right to purchase up to 120,000 shares of our common stock at an exercise price of $ 3.52 per share, which exercise price represents the five-day

volume-weighted average price of our common stock for the five trading day period ending on the trading day immediately prior to the day on which the Warrant was issued.

Epsilon may exercise the Warrant in whole or in part at any time during the period ending October 1, 2021 .

The Warrant includes a cashless exercise feature and provides that, if Epsilon is in default of its obligations to fund any advance pursuant to and in accordance with the Restated Note Purchase Agreement, then, thereafter, the maximum aggregate number of shares of common stock that may be purchased under the Warrant shall be the number determined by multiplying 120,000 by a fraction, (a) the numerator of which is the aggregate principal amount of advances that have been extended to the OME by Epsilon pursuant to the Restated Note Purchase Agreement on or after the date of the Warrant and prior to the date of such failure and (b) the denominator of which is $ 3.0 million.

During November 2020, Epsilon exercised this warrant using the cashless exercise feature.

This exercise resulted in the issuance of 56,228 of our common shares and the forfeiture of the right to acquire the remaining 63,772 common shares.

Accounting considerations for additional tranches

We evaluated for proper classification under ASC 480 Distinguishing Liabilities from Equity

(“ASC 480”), ASC 815 Derivatives and Hedging

(“ASC 815”) and ASC 320 Property, Plant and Equipment

This debt agreement did not contain any embedded terms or features that have characteristics of derivatives.

Additionally, the warrant agreement did not contain any terms or features that would preclude equity classification.

We were required to consider whether the hybrid contract embodied a beneficial conversion feature (“BCF”).

The allocations of the three additional tranches were as follows.

Promissory Note

Beneficial Conversion Feature (“BCF”)*

A beneficial conversion feature arises when the calculation of the effective conversion price is less than the Company’s stock price on the date of issuance.

Tranche 5 did not result in a BCF because the effective conversion price was greater than the company’s stock price on the date of issuance.

The Warrant’s fair value was calculated using the Black-Scholes-Merton (“BSM”) pricing model.

The aggregate fair value of the Warrant totaled $ 303,712 .

Because the Warrant was issued as an inducement to Epsilon to issue additional debt, we recorded an inducement expense of $ 303,712 .

For the three months ended September 30, 2021 and 2020 interest expense in the amount of $ 0 and $ 25,205 , respectively, was recorded.

For the nine months ended September 30, 2021 and 2020 interest expense in the amount of $ 34,520 and $ 75,067 , respectively, was recorded.

Term Extension (March 21, 2017)

On March 21, 2017 we entered into an amendment to the Restated Note Purchase Agreement with Epsilon.

In connection with the existing $ 6.0 million of indebtedness, the adjusted principal balance is due and payable in full upon the earlier of (i) written demand by Epsilon or (ii) such time as Odyssey or the guarantor pays any other indebtedness for borrowed money prior to its stated maturity date.

As such the Company amortized the notes up to their face value of $ 6,050,000 and they are classified as short-term.

However, because Epsilon converted the first $ 3.0 million into 670,455 of our common shares and assigned $ 2.0 million to MINOSA, the principal indebtedness at September 30, 2021 was zero and at December 31, 2020 was $ 1.0 million.

Note 5 – SMOM

On May 3, 2017, we entered into a Loan and Security Agreement (“Loan Agreement”) with SMOM.

Pursuant to the Loan Agreement, SMOM agreed to loan us up to $ 3.0 million as evidenced by a convertible promissory note.

As a commitment fee, we assigned the remaining 50 % of our Neptune Minerals, LLC receivable to SMOM.

This receivable had zero carrying value on our balance sheet and due to the age and collectability was deemed to have no fair value.

The indebtedness bears interest at a rate of 10 % per annum and matures on the second anniversary of this Loan Agreement which is May 3, 2019.

During January 2021, this Loan Agreement was amended by increasing the interest rate to 18 %, effective January 1, 2021.

On April 20, 2018, the loan was amended, and the principal amount of the Loan was increased to $ 3.5 million.

The loan balance at September 30, 2021 and December 31, 2020 was $ 3.5 million.

The holder has the option to convert up to $ 2.0 million of any unpaid principal and interest into up to 50 % of the equity interest held by Odyssey in Aldama Mining Company, S.de R.L.

which is a wholly owned subsidiary of ours.

The conversion value of $ 1.0 million equates to 10 % of the equity interest in Aldama.

If the holder elects to acquire the entire 50 % of the equity interest, the Holder has to pay the deficiency in cash.

As additional consideration for the loan, the holder has the right to purchase from Odyssey all or a portion of the equity collateral (up to the 50% of the equity interest of Aldama) for the option consideration ($ 1.0 million for each 10 % of equity interests) during the period that is the later of (i) one year after the maturity date and (ii) one year after the loan is repaid in full, the expiration date.

The lender may also choose to extend the expiration date annually by paying $ 500,000 for each year extended.

For the three months ended September 30, 2021 and 2020, interest expense in the amount of $ 158,795 and $ 88,219 , respectively, was recorded.

For the nine months ended September 30, 2021 and 2020 interest expense in the amount of $ 471,207 and $ 262,739 , respectively, was recorded.

We recognized approximately $ 54,000 and $ 41,000 in rent expense associated with these leases for the three month periods ended March 31, 2022 and 2021, respectively.

NOTE H – LOANS PAYABLE

The Company’s consolidated notes payable consisted of the following carrying values and related interest expense at:

Interest expense

Litigation financing

Emergency Injury Disaster Loan

Vendor note payable

Litigation Financing

For the three months ended March 31, 2022 and 2021, we recorded $ 68,140 and $ 50,479 , respectively, of interest expense from the amortization of the debt discount and $ 36,724 and $ 28,982 interest from the fee amortization, respectively.

The March 31, 2022 and December 31, 2021 carrying value of the debt wa

s $ 19,334,009 and $ 18,323,097 , respectively, and were

net of unamortized debt fees of $ 257,069 and $ 293,793 , respectively, as well as the net unamortized debt discount of $ 581,788 and $ 649,928 , respectively, associated with the fair value of the warrant.

The total face value of this obligation at March 31, 2022 and December 31, 2021 was $ 20,172,866 and 19,266,818 , respectively.

On March 17, 2022 we entered into a Note Purchase Agreement (“Note Agreement”) with 37North SPV 11, LLC (“37N”) in which 37N agreed to loan

us up to $ 2,000,000 .

These loan proceeds were received in full on March 25, 2022.

Pursuant to the Note

Agreement, the indebtedness is non-interest

bearing and matures on June 15, 2022.

Anytime from 30 days after the maturity date, 37N has the option to convert all or a portion of the outstanding amount of the indebtedness into conversion shares equal to the quotient obtained by dividing (A) 125% of the amount of the indebtedness, by (B) the lower of $5.94 and 70% of the 10-day VWAP.

The aggregate maximum number of shares of Common Stock to be issued in connection with conversion

of the indebtedness

will not exceed i) 19.9 % of the outstanding shares of Common Stock prior to the date of the Agreement, ii) 19.9 % of the combined voting power of the outstanding voting securities, or iii) exceed the applicable listing rules of the Principal Market if the stockholders

don’t approve the issuance of Common Stock upon conversion of the indebtedness .

Any time prior to maturity, we have the option to prepay the indebtedness

at an amount of 110 % of the unpaid principal.

From the maturity date to 29 days after the maturity date (July 14, 2022), we may prepay all (but not less than) an amount equal to 115 % of the unpaid amount of the indebtedness.

Anytime, after the 30th day after the maturity date (July 15, 2022), we may prepay all (but not less than) an amount equal to 125 % of the unpaid amount of the indebtedness , however, we must provide 37N a p

otice at least 10 days prior to repayment.

If 37N delivers an exercise notice during this 10 -day

period, the Note will be converted, rather than prepaid.

If 37N delivers an exercise notice and the number of shares issuable is limited by the 19.9 % limitation outlined above, then we may prepay all (but not less than all) an amount equal to 130 % of the remaining unpaid amount.

Accounting considerations

We have accounted for this transaction as a financing transaction, wherein the net proceeds received were allocated to the financial instruments issued.

Prior to making the accounting allocation, we evaluated for proper classification under ASC 480 Distinguishing Liabilities from Equity

(“ASC 480”), ASC 815 Derivatives and Hedging

(“ASC 815”) and ASC 320 Property, Plant and Equipment

This debt agreement did not contain any embedded terms or features that have characteristics of derivatives.

However, we were required to consider whether the hybrid contract embodied a beneficial conversion feature (“BCF”).

The calculation of the effective conversion amount did not result in a BCF because the effective conversion price was equal to the Company’s stock price on the date of issuance.

On October 4, 2021 we entered into a Termination and Settlement agreement with Monaco that cancelled the entire indebtedness of approximately

million of principal and accrued interest related to this arrangement.

See NOTE – M SUBSEQUENT EVENT below.

Note 6 – MINOSA 2

On August 10, 2017, we entered into a Note Purchase Agreement (the “Minosa Purchase Agreement”) with MINOSA.

Pursuant to the Minosa Purchase Agreement, MINOSA agreed to loan Enterprises up to $ 3.0 million.

During 2017, we borrowed $ 2.7 million against this facility ,

and Epsilon assigned $ 2.0 million of its debt to MINOSA.

At September 30, 2021 and December 31, 2020, the outstanding principal balance, including the Epsilon assignment, was $ 5.05 million.

The indebtedness is evidenced by a secured convertible promissory note (the “Minosa Note”) and bears interest at a rate equal to 10.0 % per annum.

Unless otherwise converted as described below, the entire outstanding principal balance under this Minosa Note and all accrued interest and fees are due and payable upon written demand by MINOSA;

provided, that MINOSA agreed not make a demand for payment prior to the earlier of (a) an event of default (as defined in the Minosa Note) or (b) a date, which may be no earlier than December 31, 2017, that is at least 60 days subsequent to written notice that MINOSA intends to demand payment.

MINOSA has not provided any notice they intend to issue a payment demand notice.

We unconditionally and irrevocably guaranteed all of the obligations under the Minosa Purchase Agreement and the Minosa Note.

MINOSA has the right to convert all amounts outstanding under the Minosa Note into shares of our common stock upon 75 days’ notice to us or upon a merger, consolidation, third party tender offer,

or similar transaction relating to us at the conversion price of $ 4.35 per share.

During December 2017, MINOSA transferred this in

to its parent company.

On July 15, 2021, $ 404,633 of this in

with accumulated interest of $ 159,082

was transferred to a director of the Company, and that indebtedness continues to be convertible at a conversion price

This transaction was reviewed and approved by the independent members of the Company’s board of directors.

This debt agreement did not contain any embedded terms or features that have characteristics of derivatives.

However, we were required to consider whether the hybrid contract embodied a beneficial conversion feature (“BCF”).

As of December 31, 2017, all of the BCF has been accreted to the income statement.

The BCF represented a debt discount that was amortized over the life of the loan.

For the three months ended September 30, 2021 and 2020, interest expense in the amount of $ 127,287 and $ 127,287 , respectively, was recorded.

For the nine months ended September 30, 2021 and 2020 interest expense in the amount of $ 377,711 and $ 379,094 , respectively, was recorded.

As previously reported, Epsilon loaned us an aggregate of $ 6.0 million pursuant to an amended and restated convertible promissory Minosa Note, dated as of March 18, 2016, as further amended and restated on October 1, 2016 (the “Epsilon Note”).

Since then, Epsilon has assigned $ 2.0 million of the indebtedness under the Epsilon Note to MINOSA.

Along with Epsilon, we entered into a second amended and restated convertible promissory note (the “Second AR Epsilon Note”), which further amends and restates the Epsilon Note.

The stated principal amount of the Second AR Epsilon Note is $ 1.0 million (which reflects the outstanding principal balance remaining after giving effect to Epsilon’s (x) previous assignment of $ 2.0 million of the indebtedness under the Epsilon Note to MINOSA and (y) conversion of $ 3.0 million of the indebtedness under the Epsilon Note into shares of our common stock).

The Second AR Epsilon Note further provides that the outstanding principal balance under the Second AR Epsilon Note and all accrued interest and fees are due and payable upon written demand by Epsilon;

provided, that Epsilon agreed not make a demand for payment prior to the earlier of (a) an event of default (as defined in the Second AR Epsilon Note) or (b) a date, which may be no earlier than December 31, 2017, that is at least 60 days subsequent to written notice that MINOSA intends to demand payment.

Upon the closing of the Minosa Purchase Agreement, along with MINOSA, and Penelope Mining LLC, an affiliate of Minosa (“Penelope”), executed and delivered a Second Amended and Restated Waiver and Consent and Amendment No.

5 to Promissory Note and Amendment No.

2 to Stock Purchase Agreement (the “Second AR Waiver”).

Pursuant to the Second AR Waiver, Minosa and Penelope consented to the transactions contemplated by the Minosa Purchase Agreement and waived any breach of any representation or warranty and violation of any covenant in the Stock Purchase Agreement, dated as of March 11, 2015, as amended April 10, 2015 (the “SPA”), by and among us, Minosa, and Penelope, arising out of the Company’s execution and delivery of the Minosa Purchase Agreement and the consummation of the transactions contemplated thereby.

Pursuant to the Second AR Waiver, we also waived, and agreed not to exercise our right to terminate the SPA pursuant to Section 8.1(c)(ii) thereto, both (a) until after the earlier of (i) July 1, 2018, (ii) the date that MINOSA fails, refuses, or declines to fund (or otherwise does not fund) any subsequent loan under the Minosa Purchase Agreement and (iii) demand is made for repayment of all or any part of the indebtedness outstanding under the Minosa Note, the Second AR Epsilon Note, or the Promissory Note, dated as of March 11, 2015, as amended (the “SPA Note”), in the principal amount of $ 14.75 million that was issued by us to MINOSA under the SPA, and (b) unless on or prior to such termination, the Notes are paid in full.

The Second AR Waiver (x) further provides that following any conversion of the indebtedness evidenced by the Minosa Note, Penelope may elect to reduce its commitment to purchase our preferred stock under the SPA by the amount of indebtedness converted by MINOSA and (y) amends the SPA Note to provide that the outstanding principal balance under the SPA Note and all accrued interest and fees are due and payable upon written demand by MINOSA;

provided, that Minosa agreed not make a demand for payment prior to the earlier of (a) an event of default (as defined in the Minosa Note) or (b) a date, which may be no earlier than December 31, 2017, that is at least 60 days subsequent to written notice that Minosa intends to demand payment.

The obligations under the Minosa Note may be accelerated upon the occurrence of specified events of default including (a) our failure to pay any amount payable under the Minosa Note on the date due and payable;

(b) our failure to perform or observe any term, covenant, or agreement in the Minosa Note or the related documents, subject to a five-day

(c) the occurrence and expiration of all applicable grace periods, if any, of an event of default or material breach by us under any of the other loan documents;

(d) the termination of the SPA;

(e) commencement of certain specified dissolution, liquidation, insolvency, bankruptcy, reorganization, or similar cases or actions by or against us, in specified circumstances unless dismissed or stayed within 60 days;

(f) the entry of a judgment or award against us in excess of $ 100,000 ;

and (g) the occurrence of a change in control (as defined in the Minosa Note).

Pursuant to second amended and restated pledge agreements (the “Second AR Pledge Agreements”) entered into by us in favor of MINOSA, we pledged and granted security interests to MINOSA in (a) the 54 million cuotas (a unit of ownership under Panamanian law) of Oceanica held by us, (b) all notes and other receivables from Oceanica and its subsidiary owed to us, and (c) all of the outstanding equity in our wholly owned subsidiary, Odyssey Marine Enterprises, Ltd.

In connection with the execution and delivery of the Minosa Purchase Agreement, Odyssey and MINOSA entered into a second amended and restated registration rights agreement (the “Second AR Registration Rights Agreement”) pursuant to which Odyssey agreed to register the offer and sale of the shares (the “Conversion Shares”) of our common stock issuable upon the conversion of the indebtedness evidenced by the Minosa Note.

Subject to specified limitations set forth in the Second AR Registration Rights Agreement, including that we are eligible to use Form S-3,

the holder of the Minosa Note can require us to register the offer and sale of the Conversion Shares if the aggregate offering price thereof (before any underwriting discounts and commissions) is not less than $ 3.0 million.

In addition, we agreed to file a registration statement relating to the offer and sale of the Conversion Shares on a continuous basis promptly (but in no event later than 60 days after) after the conversion of the Minosa Note into the Conversion Shares and to thereafter use its reasonable best efforts to have such registration statement declared effective by the Securities and Exchange Commission.

Note 7 – Monaco 2018

During the period ended March 31, 2018, Monaco advanced us $ 1.0 million that was included in a loan agreement that was executed on April 20, 2018.

Monaco also agreed to treat $ 99,366 of back rent owed by us to Monaco as part of this loan resulting in an aggregate principal amount of $ 1,099,366 at September 30, 2021 and December 31, 2020.

The indebtedness bears interest at 10.0 % percent per year.

During January 2021, this loan agreement was amended by increasing the interest rate to 18 %, effective January 1, 2021.

All principal and any unpaid interest are payable on the first anniversary of this agreement, April 20, 2019.

This debt is secured by cash proceeds, if any, from our future shipwreck projects we have contracted with Magellan.

As additional consideration, their share purchase option expiration date, as discussed in Note 1 – Monaco 2014 and Note 2 – Monaco 2016 above, has been extended from 30 days to seven months after the note becomes paid in full.

For the three months ended September 30, 2021 and 2020, interest expense in the amount of $ 72,505 and $ 34,827 , respectively, was recorded.

For the nine months ended September 30, 2021 and 2020 interest expense in the amount of $ 205,981 and $ 102,621 , respectively, was recorded.

On October 4, 2021 we entered into a Termination and Settlement agreement with Monaco that cancelled the entire indebtedness of approximately

million of principal and accrued interest related to this arrangement.

See NOTE – M SUBSEQUENT EVENT below.

Note 8 – Promissory note

On July 12, 2018, we entered into a Note and Warrant Purchase Agreement (the “Purchase Agreement”) with two individuals (the “Lenders”), one of whom holds in excess of 5.0 % of our outstanding common stock.

Pursuant to the Purchase Agreement, the Lenders agreed to lend an aggregate of $ 1,050,000 to us, which was advanced in three tranches on July 12, 2018, $ 500,000 , August 17, 2018, $ 300,000 and October 4, 2018, $ 250,000 .

The indebtedness is evidenced by secured convertible promissory notes (the “Notes”) and bears interest at a rate equal to 8.0 % per annum.

Unless otherwise converted as described below, the entire outstanding principal balance under the Notes and all accrued interest and fees are due and payable on July 12, 2019.

Term Extension (July 8, 2019)” below.

At any time after to the first to occur of (a) a sale by us of additional Notes or (b) September 12, 2018, the Lenders have the right to convert all amounts outstanding under the Notes into either (x) shares of our common stock at the conversion rate of $ 8.00 per share, (y) $ 500,000 of the indebtedness owed by Exploraciones Oceanicas S.

(“ExO”) to Oceanica Marine Operations, S.R.L.

(“OMO”), or (z) a 7.5 % interest in Aldama Mining Company, S.

We indirectly hold a controlling interest in ExO;

OMO and Aldama are indirect, wholly owned subsidiaries of ours.

In connection with the issuance and sale of the Notes, we issued warrants to purchase common stock (the “Warrants”) to the Lenders.

The Lenders may exercise the Warrants to purchase an aggregate of 65,625 shares of our common stock at an exercise price of $ 12.00 per share.

The Warrants are exercisable during the period commencing on the date on which the Notes are converted into shares of our common stock and ending on July 12, 2021.

Pursuant to a Pledge Agreement, dated as of July 12, 2018 (the “Pledge Agreement”), our obligations under the Notes are secured by a pledge of a portion of Odyssey’s ownership interest in Aldama and another entity.

Pursuant to a Registration Rights Agreement (the “Rights Agreement”) among us and the Lenders, we granted the Lenders “piggy-back” registration rights with respect to the shares of our common stock issuable upon conversion of the Notes and the exercise of the Warrants.

The Purchase Agreement, the Notes, the Warrants, the Pledge Agreement, and the Rights Agreement include representations and warranties and other covenants, conditions, and other provisions customary for comparable transactions.

We have accounted for this transaction as a financing transaction, wherein the net proceeds received were allocated to the financial instruments issued.

Prior to making the accounting allocation, we evaluated the transaction for proper classification under ASC 480 Distinguishing Liabilities from Equity (“ASC 480”), ASC 815 Derivatives and Hedging (“ASC 815”).

We determined that the debt achieved conventional convertible status and that the equity conversion option was in the money at inception which required the calculation of a beneficial conversion feature (“BCF”).

The fair value of the warrants and BCF component exceeded the amount of proceeds, therefore, they were limited to the cash proceeds of $ 1,050,000 at December 31, 2018.

As a result, there was no value allocated to the debt at inception.

The debt was being accreted to face value over its term using the effective interest method.

The face value of this debt was zero at September 30, 2021 and $ 1.05 million December 31, 2020.

For the three months ended September 30, 2021 and 2020, interest expense in the amount of $ 3,250 and $ 24,782 , respectively, was recorded.

For the nine months ended September 30, 2021 and 2020 interest expense in the amount of $ 54,734 and $ 72,366 , respectively, was recorded.

Term Extension (July 8, 2019)

On July 8, 2019, Odyssey and the Lenders entered into a Second Amendment to Note and Warrant Purchase Agreement and Note and Warrant Modification Agreement (the “Second Amendment”) pursuant to which certain terms and provisions of the Notes and Warrants were amended or otherwise modified.

The material terms and provisions that were amended or otherwise modified are as follows:

the maturity date of the Notes was extended by one year, to July 12, 2020 (the parties are currently in discussions to further extend the maturity date of the Notes);

the conversion rate of the Notes and the exercise price of the Warrants were modified to $5.756, which represented the “market price” of Odyssey’s common stock as of July 7, 2019, the day before the Second Amendment was signed;

the Notes are unsecured;

the Notes are convertible only into shares of Odyssey common stock;

the modified Warrants are exercisable at any time until July 8, 2024 to purchase an aggregate of 196,135 shares of our common stock.

We evaluated the amendment’s impact on the accounting for the Note in accordance with ASC 470-50-40-6

through 12 to determine whether extinguishment accounting was appropriate.

The modification had a cash flow effect on a present value basis of less than 10 %.

However, the reduction in the conversion price resulted in a change in the fair value of the embedded conversion option that was more than 10 % of the carrying value of the Note immediately prior to the modification.

Because the amendment resulted in a substantial modification, extinguishment accounting was required, and we recorded a loss on the extinguishment of debt of $ 290,024 .

The extinguishment accounting resulted in a fair value reacquisition price of this debt of $ 1,340,024 .

The premium of $ 290,024 was being amortized over the remaining life of the debt.

The warrant modification was treated as an inducement to extend the debt therefore the fair value of the warrants of $ 868,878 was a period expense and charged to interest expense with an offset to equity.

Term Extension (August 14, 2020)

On August 14, 2020, we entered into a Third Amendment to Note and Warrant Purchase Agreement and Note and Warrant Modification Agreement (the “Third Amendment”) with the Lenders.

Certain terms and provisions of the Notes were modified, and we issued a new warrant to purchase common stock to each of the Lenders as consideration for them entering into the Third Amendment.

The warrants have an exercise price of $ 4.67 and are exercisable any time until August 14, 2023 .

Material terms and provisions that were amended or otherwise modified are as follows:

the maturity date of the Notes was extended by one year, to July 12, 2021 and

the conversion rate of the Notes was modified to $ 4.67 .

As of August 14, 2020, the aggregate amount of indebtedness outstanding under the Notes was $ 1,232,846 .

As amended by the Third Amendment, the Notes are convertible into an aggregate of 263,993 shares of our common stock, and the new Warrants are exercisable to purchase an aggregate of 131,996 shares of our common stock for $ 4.67 per share.

The modification of the Notes and the issuance of the warrants, were evaluated under ASC 470-50-40,

“Debt Modification and Extinguishments.” By applying the guidance, the Notes were determined to be substantially different and the transaction qualified for extinguishment accounting.

As a result, we recorded a loss on extinguishment of approximately $ 777,500 , which included the fair value of the warrants given as consideration for the modification.

The premium of $ 358,497 is being amortized over the remaining life of the debt.

The related amortization for the three months ended September 30, 2021 and 2020 was $ 10,864 and $ 78,050 , respectively and $ 195,863 and $ 217,028 for the nine months ended September 30, 2021 and 2020, respectively.

The unamortized premium at September 30, 2021 was zero and at December 31, 2020 it was $ 195,863 .

Upon maturity of this indebtedness on July 12, 2021, the Lenders converted the Note and interest totaling $ 1,325,582 into 283,850 shares of our common stock.

The conversion price was $ 4.67 per share of common stock.

Note 9 – Litigation Financing

On June 14, 2019, Odyssey and Exploraciones Oceánicas S.

de C.V., our Mexican subsidiary (“ExO” and, together with Odyssey, the “Claimholder”), and Poplar Falls LLC (the “Funder”) entered into an International Claims Enforcement Agreement (the “Agreement”), pursuant to which the Funder agreed to provide financial assistance to the Claimholder to facilitate the prosecution and recovery of the claim by the Claimholder against the United Mexican States under Chapter Eleven of the North American Free Trade Agreement (“NAFTA”) for violations of the Claimholder’s rights under NAFTA related to the development of an undersea phosphate deposit off the coast of Baja Sur, Mexico (the “Project”), on our own behalf and on behalf of ExO and United Mexican States (the “Subject Claim”).

Pursuant to the Agreement, the Funder agreed to specified fees and expenses regarding the Subject Claim (the “Claims Payments”) incrementally and at the Funder’s sole discretion.

Under the terms of the Agreement, the Funder agreed to make Claims Payments in an aggregate amount not to exceed $ 6,500,000 (the “Maximum Investment Amount”).

The Maximum Investment Amount will be made available to the Claimholder in two phases, as set forth below:

a first phase, in which the Funder shall make Claims Payments in an aggregate amount no greater than $ 1,500,000 for the payment of antecedent and ongoing costs (“Phase I Investment Amount”);

a second phase, in which the Funder shall make Claims Payments in an aggregate amount no greater than $ 5,000,000 for the purposes of pursuing the Subject Claim to a final award (“Phase II Investment Amount”).

Upon exhaustion of the Phase I Investment Amount, the Claimholder will have the option to request Tranche A of the Phase II Investment Amount, consisting of funding up to $ 3.5 million (“Tranche A Committed Amount”).

Upon exhaustion of the Tranche A Committed Amount, the Claimholder will have the option to request Tranche B of the Phase II Investment Amount, consisting of funding of up to $ 1.5 million (“Tranche B Committed Amount”).

The Claimholder must exercise its option to receive the Tranche A Committed Amount in writing, no less than thirty days before submitting a Funding Request to the Funder under Tranche A.

The Claimholder must exercise its option to receive the Tranche B Committed Amount in writing within forty-five days after the exhaustion of the Tranche A Committed Amount.

Pursuant to the Agreement, the Claimholder agreed that, upon exercising the Claimholder’s option to receive funds under Phase I, Tranche A of Phase II, or Tranche B of Phase II, the Funder will be the sole source of third-party funding for the specified fees and expenses of the Subject Claim under each respective phase and tranche covered by the option exercised, and the Claimholder will obtain funding for such fees and expenses, only as set forth in the Agreement.

The Funder was due closing fee of $ 80,000 for the Phase I Investment Amount, and $ 80,000 for the Phase II Investment Amount to pay third parties in connection with due diligence and other administrative and transaction costs incurred by the Funder prior to and in furtherance of execution of the Agreement.

Upon the Funder making Claims Payments to the Claimholder or its designees in an aggregate amount equal to the Maximum Investment Amount, the Funder has the option to continue funding the specified fees and expenses in relation to the Subject Claim on the same terms and conditions provided in the Agreement.

The Funder must exercise its option to continue funding in writing, within thirty days after the Funder has made Claims Payments in an aggregate amount equal to the Maximum Investment Amount.

If the Funder exercises its option to continue funding, the parties agreed to attempt in good faith to amend the Agreement to provide the Funder with the right to provide at the Funder’s discretion funding in excess of the Maximum Investment Amount, in an amount up to the greatest amount that may then be reasonably expected to be committed for investment in Subject Claim.

If the Funder declines to exercise its option, the Claimholder may negotiate and enter into agreements with one or more third parties to provide funding, which shall be subordinate to the Funder’s rights under the Agreement.

The Agreement provides that the Claimholder may at any time without the consent of the Funder either settle or refuse to settle the Subject Claim for any amount;

provided, however, that if the Claimholder settles the Subject Claim without the Funder’s consent, which consent shall not be unreasonably withheld, conditioned, or delayed, the value of the Recovery Percentage (as defined below) will be deemed to be the greater of (a) the Recovery Percentage (under Phase I or Phase II, as applicable), or (b) the total amount of all Claims Payments made in connection with such Subject Claim multiplied by three (3).

If the Claimholder ceases the Subject Claim for any reason other than (a) a full and final arbitral award against the Claimholder or (b) a full and final monetary settlement of the claims, including in particular, for a grant of an environmental permit to the Claimholder allowing it to proceed with the Project (with or without a monetary component), all Claims Payments under Phase I and, if Claimholder has exercised the corresponding option, the Tranche A Committed Amount and Tranche B Committed Amount, shall immediately convert to a senior secured liability of the Claimholder.

This sum shall incur an annualized internal rate of return (IRR) of 50.0% retroactive to the date each Funding Request was paid by the Funder (under Phase I), or, to the conversion date for the Tranche A Committed Amount and Tranche B Committed Amount of Phase II if the Claimholder has exercised the respective option (collectively, the “Conversion Amount”).

Such Conversion Amount and any and all accrued IRR shall be

payable in-full by

the Claimholder within 24 months of the date of such conversion, after which time any outstanding Conversion Amounts, shall accrue an (IRR) of 100.0%, retroactive to the conversion date (the “Penalty Interest Amount”).

The Claimholder will execute such documents and take other actions as necessary to grant the Funder a senior security interest on and over all sums due and owing by the Claimholder in order to secure its obligation to pay the Conversion Amount to the Funder.

If the Claimholder ceases the Subject Claim due to the grant of an environmental permit (with or without a monetary component), all Claims Payments under Phase 1 and, if the Claimholder has exercised the corresponding option, the Tranche A Committed Amount and Tranche B Committed Amount shall immediately convert to a senior secured liability of the Claimholder and shall incur an annualized an IRR of 50.0% on the Conversion Amount, from the conversion date.

Management has estimated it is more likely than not the Subject Claim will result in the issuance of the environmental permit requiring us to record interest under Generally Accepted Accounting Principles.

Reliance should not be placed on this estimate in determining the likely outcome of the Subject Claim.

If, at any time after exercising its option to receive funds under either Tranche A or Tranche B of Phase II, the Claimholder wishes to fund the Subject Claim with its own capital (“Self-Funding”) (which excludes any Claims Payments made, either directly or indirectly, by any other third party), the Claimholder shall immediately pay to the Funder the Conversion Amount, provided that this requirement shall not apply if, after the Funder has made Claims Payments in an aggregate amount equal to the Maximum Investment Amount, the Funder does not exercise its option to provide Follow-On Funding.

In the event of any receipt of proceeds resulting from the Subject Claim (“Proceeds”), the Funder shall be entitled to any additional sums above the Conversion Amount to which the Funder is entitled as described below.

Should the Claimholder cease the Subject Claim as described above after Self-Funding the Claim, accrued IRR and Penalty Interest shall be calculated and paid to the Funder as set forth above.

The Funder’s rights to the Recovery Percentage as defined below shall survive any decision by Claimholder to utilize Self-Funding.

The parties acknowledge this Agreement constitutes a sale of the right to a portion of the Proceeds (if any) arising from the Subject Claim as set forth in this Agreement.

The Claimholder has relinquished its right to the portion of the proceeds, if any, that the Funder would have the right to as described below.

This sale of proceeds is being accounted for under the guidance of ASC 470-10-25

Recognition (Sales of Future Revenues)

On each Distribution Date, distributions of the Proceeds shall be made to the Claimholder and the Funder in accordance with subparagraph (a) or (b) below (the “Recovery Percentage”), as applicable:

If the Claimholder receives only the Phase I Investment Amount from the Funder, the first Proceeds shall be distributed as follows:

first, 100.0% to the Funder, until the cumulative amount distributed to the Funder equals the total Claims Payments paid by the Funder under Phase I;

second, 100.0% to the Funder until the cumulative amount distributed to the Funder equals an IRR of 20% of Claims Payments paid by the Funder under Phase I (“Phase I Compensation”), per annum;

thereafter, 100.0% to the Claimholder.

If the Claimholder exercises its options to receive Tranche A or both Tranche A and Tranche B of the Phase II Investment Amount, the first Proceeds shall be distributed as follows:

first, 100.0% to the Funder until the cumulative amount distributed to the Funder equals the total Claims Payments paid by the Funder under Phases I and II;

second, 100.0% to the Funder until the cumulative amount distributed to the Funder equals an additional 300.0% of Phase I Investment Amount;

plus an additional 300% of the Tranche A Committed Amount (i.e.

300.0% of $3.5 million), less any amounts remaining of the Tranche A Committed Amount that the Funder did not pay as Claims Payments;

plus an additional 300.0% of the Tranche B Committed Amount (i.e.

300.0% of $1.5 million), if the Claimholder exercises the Tranche B funding option, less any amounts remaining of the Tranche B Committed Amount that the Funder did not pay as Claims Payments;

third, for each $10,000 in specified fees and expenses paid by the Funder under Phase I and Phase II and any amounts over each $10,000 of the Tranche A Committed Amount and the Tranche B Committed Amount (if the Claimholder exercises the Tranche B funding option), 0.01% of the total Proceeds from any recoveries after repayment of (i) and (ii) above, to the Funder;

thereafter, 100% to the Claimholder.

The Agreement provides that if no Proceeds are ever paid to or received by the Claimholder or its representatives and if the environmental permit is not issued, the Funder shall have no right of recourse or right of action against the Claimholder or its representatives, or any of their respective property, assets, or undertakings, except as otherwise specifically contemplated by the Agreement.

If (a) Proceeds are paid to or received by the Claimholder or its representatives;

(b) such Proceeds are promptly applied and/or distributed by the Claimholder or on behalf of the Claimholder in accordance with the terms of the Agreement;

and (c) the amount received by the Funder as a result thereof is not sufficient to pay all of the Recovery Percentage and all of the amounts due to the Funder under the Agreement, then (provided that all of the Proceeds which the Funder will ever be entitled to have been paid to or received by the Funder), the Funder shall have no right of recourse or action against the Claimholder or its Representatives, or any of their property, assets, or undertakings, except as otherwise specifically contemplated by the Agreement.

Pursuant to the Agreement, the Claimholder acknowledged the Funder’s priority right, title, and interest in any Proceeds, including against any available collateral to secure its obligations under the Agreement, which security interest shall be first in priority as against all other security interests in the Proceeds.

The Claimholder also acknowledged and agreed to execute and authorize the filing of a financing statement or similar and to take such other actions in such jurisdictions as the Funder, in its sole discretion, deems necessary and appropriate to perfect such security interest.

The Agreement also includes representations and warranties, covenants, conditions, termination and indemnification provisions, and other provisions customary for comparable arrangements.

Amendment and Restatement (January 31, 2020)

On January 31, 2020, the Claimholder and the Funder entered into an Amended and Restated International Claims Enforcement Agreement (the “Restated Agreement”).

The material terms and provisions that were amended or otherwise modified are as follows:

The Funder agreed to provide up to $ 2.2 million in Arbitration Support Funds for the purpose of paying the Claimholder’s litigation support costs in connection with Subject Claim;

A closing fee of $ 200,000 has been retained by the Funder in connection with due diligence and other transaction costs incurred by the Funder;

A warrant was issued to purchase our common stock which is exercisable for a period of five years beginning on the earlier of (a) the date on which the Claimholder ceases the Subject Claim for any reason other than a full and final arbitral award against the Claimholder or a full and final monetary settlement of the claims or (b) the date on which Proceeds are received and deposited into escrow.

The exercise price per share is $ 3.99 , and the Funder can exercise the warrant to purchase the number of shares of our common stock equal to the dollar amount of Arbitration Support Funds provided to us pursuant to the Restated Agreement divided by the exercise price per share (subject to customary adjustments and limitations);

All other terms in the Restated Agreement are substantially the same as in the original Agreement.

During 2020, the Funder provided us with $ 2.0 million of the Arbitration Support Funds, and we incurred $ 200,000 in related fees that were treated as an additional advance.

Upon each funding, the proceeds were allocated between debt and equity for the warrants based on the relative fair value of the two instruments.

As a result, there was a debt discount of $ 1,063,811 which is being amortized over the expected remaining term of the agreement using the effective interest method which is charged to interest expense.

Although the warrants only become exercisable upon the occurrence of future events, they are considered issued for accounting purposes and were valued using a binomial lattice model.

The expected volatility assumption was based on the historical volatility of our common stock.

The expected life assumption was primarily based on management’s expectations of when the Warrants will become exercisable and the risk-free interest rate for the expected term of the warrant is based on the U.S.

Treasury yield curve in effect at the time of measurement.

Second Amendment and Restatement (December 12, 2020)

On December 12, 2020, the Claimholder and the Funder entered into a Second Amended and Restated International Claims Enforcement Agreement (the “Second Restated Agreement”) relating to the Subject Claim.

Under the terms of the Second Restated Agreement, the Funder has made and agreed to make Claims Payments in an aggregate amount not to exceed $ 20,000,000 (the “Maximum Investment Amount”).

The Second Restated Agreement requires the Funder to make Claims Payments in an aggregate amount no greater than $ 10,000,000 for the purposes of pursuing the Subject Claim to a final award (“Phase III Investment Amount”).

We also incurred $ 200,000 in related fees which were treated as an additional advance.

This Second Restated Agreement includes the same representations and warranties, covenants, conditions, termination and indemnification provisions, and other provisions as in the original agreement.

Third Amendment and Restatement (June 14, 2021)

On June 14, 2021, the Claimholder and the Funder entered into a Third Amended and Restated International Claims Enforcement Agreement (the “Third Restated Agreement”) relating to the Subject Claim.

Under the terms of the Third Restated

Agreement, the Funder has made and agreed to make Claims Payments in an aggregate amount not to exceed $ 25,000,000 , an

increase of $ 5.0 million (the “Incremental Amount”).

The Third Restated Agreement requires the Claimholder to request $2.5 million of the Incremental Amount (the “First $2.5 Million”).

Within 15 days after exhaustion of the First $2.5 Million, the Claimholder may either (a) request the remaining $2.5 million (the “Second $2.5 Million”) of the Incremental Amount or (b) notify the Funder that the Claimholder has decided to self-fund the Second $2.5 Million.

We also incurred $ 80,000 in related fees which were treated as an additional advance.

This Second Restated Agreement includes the same representations and warranties, covenants, conditions, termination and indemnification provisions, and other provisions as in the original agreement.

For the three months ended September 30, 2021 and 2020, interest expense in the amount of $ 1,927,179 and $ 1,052,726 , respectively, was recorded.

For the nine months ended September 30, 2021 and 2020 interest expense in the amount of $ 5,187,181 and $ 2,399,154 , respectively, was recorded.

For the three months ended September 30, 2021 and 2020, we recorded $ 63,689 and $ 52,688 , respectively, of interest expense from the amortization of the debt discount and $ 36,724 and $ 12,766 interest from the fee amortization, respectively.

For the nine months ended September 30, 2021 and 2020, we recorded $ 174,420 and $ 109,957 , respectively, of interest expense from the amortization of the debt discount and $ 97,269 and $ 34,043 interest from the fee amortization, respectively.

The September 30, 2021 and December 31,

2020 carrying value of the debt is $ 15,665,532 and $ 10,968,729 , respectively, and is net of unamortized debt fees of $ 330,517 and $ 347,786 , respectively, as well as the net unamortized debt discount of $ 716,542 and $ 890,962 , respectively, associated with the fair value of the warrant.

The total face value of this obligation at September 30, 2021 and December 31, 2020 was $ 16,712,591 and 12,207,477 , respectively.

Note 10 – Payroll protection program

We applied to Fifth Third Bancorp (“Fifth Third”) under the Small Business Administration (the “SBA”) Paycheck Protection Program of the Coronavirus Aid, Relief and Economic Security Act of 2020 (the “CARES Act”) for a loan of $ 370,400 (the “Loan”), and the Loan was made on April 16, 2020.

The proceeds of the Loan were used to cover payroll costs, rent and utilities in accordance with the relevant terms and conditions of the CARES Act.

The Loan, which is evidenced by promissory note issued by us (the “Promissory Note”), has a

matures on April 16, 2022 , and bears interest at a rate of 0.98 % per annum.

Monthly principal and interest payments, less the amount of any potential forgiveness (discussed below), will commence seven months from the month this Note is dated.

We did not provide any collateral or guarantees for the Loan, nor did we pay any facility charge to obtain the Loan.

The Promissory Note provides for customary events of default, including, among others, those relating to failure to make payment, bankruptcy, breaches of representations and material adverse effects.

Odyssey may prepay the principal of the Loan at any time without incurring any prepayment charges.

For the three months ended September 30, 2021 and 2020, interest expense in the amount of $ 0 and $ 936 , respectively, was recorded.

For the nine months ended September 30, 2021 and 2020 interest expense in the amount of $ 1,788 and $ 1,708 , respectively, was recorded.

At September 30, 2021, the outstanding principal was zero and at December 31, 2020, was $ 370,400 .

We applied for 100% forgiveness with Fifth Third Bank during March 2021.

In July 2021, we received communication from Fifth Third Bank and the SBA confirming 100 % of this Loan was forgiven and paid in full effective July 1, 2021.

The forgiven amount was included in Other income in our Consolidated Statements of Operations .

Note 11 – Emergency Injury Disaster Loan

On June 26, 2020, we executed the standard loan documents required for securing an Economic Injury Disaster Loan (the “EIDL Loan”) from the United States Small Business Administration (the “SBA”).

The principal amount of the EIDL Loan is $ 149,900 , with proceeds to be used for working capital purposes.

Interest on the EIDL Loan accrues at the rate of 3.75 % per annum and installment payments, including principal and interest of $ 731 , are due monthly beginning 12 months from the date of the EIDL Loan.

In early 2021, the SBA extended this 12 month period to 24 months setting the first payment due date in May 2022.

The balance of principal and interest is payable thirty years from the date of the promissory note.

In connection with the EIDL Loan, the Company executed the EIDL Loan documents, which include the SBA Secured Disaster Loan Note, dated May 16, 2020, the Loan Authorization and Agreement, dated May 16, 2020, and the Security Agreement, dated May 16, 2020, each between the SBA and the Company.

For the three months ended September 30, 2021 and 2020, interest expense in the amount of $ 2,192 and $ 0 , respectively, was recorded.

For the nine months ended September 30, 2021 and 2020 interest expense in the amount of $ 8,641 and $ 0 , respectively, was recorded.

At September 30, 2021 and December 31, 2020, the outstanding principal balance was $ 149,900 .

Note 12 – Vendor note payable

We currently owe a vendor $ 484,009 as an interest-bearing trade payable.

This trade payable bears simple annual interest at a rate of 12 %.

The balance due was $ 484,009 at September 30, 2021 and December 31, 2020.

As collateral, we granted the vendor a primary lien on certain of our equipment.

The carrying value of this equipment is zero .

This agreement matured in August

During the period ended June 30, 2018, we sold various marine equipment to Magellan for $ 1.0 million and the assumption

of this vendor’s trade payable and accrued interest, however, we remain as guarantor on this trade payable.

Included in this equipment is the equipment noted above the vendor has a primary lien on.

The vendor consented to Magellan’s assumption of this debt but did not release us from our obligations.

If Magellan defaults and the vendor forecloses on this equipment currently in Magellan’s possession, we would then have a contingent liability to Magellan in the amount of $

0.5 million for two of the key assets.

The Company subsequently received back one of the two key assets thus reducing the contingent liability to $

For the three months ended September

2020 , we recorded interest expense in the amount of $

14,640 , respectively.

For the nine months ended September

2020 , we recorded interest expense in the amount of $

43,601 , respectively.

We evaluated the indebtedness and determined the shares issuable pursuant to the conversion option were determinate due to the cap on the number of issuable shares, and, as such, met the requirements for a derivative scope exception for instruments that are both indexed to an entity’s own stock and classified in stockholders’ equity.

The optional and contingent prepayment options provide the right to accelerate the settlement of debt;

however, the prepayment options can only be exercised by the Company.

As such, they are considered clearly and closely related to the debt host instrument and bifurcation was not necessary.

We early adopted ASC 2020-06,

so we were not required to analyze the instrument for a beneficial conversion feature, and the instrument was recorded wholly as debt.

Although the indebtedness does not bear interest, it must be repaid at amounts greater than the face value.

According to ASC 470-10-35-2,

if a debt instrument has a contractual maturity date that can be extended at the issuer’s option, at an increasing rate, the debt discounts and issuance costs must be amortized over the period in which the debt is estimated to be outstanding, even if that period extends beyond the debt’s original contractual maturity date.

The difference between the proceeds received and the repayment amount are generally amortized over the expected life of the indebtedness using the effective interest method.

Management estimated the expected life to be very limited, so the entire expected repayment amount of

$ 2.2 million

, representing 110 % of the indebtedness, was recorded upon issuance of the Note Agreement.

We recognized $ 200,000 of interest expense for the period ended March 31, 2022.

Certain default put provisions were not considered to be clearly and closely related to the debt host, but management concluded that the value of these default put provisions was de minimis.

We reconsider the value of the default put provisions each reporting period to determine if the value is material to the financial statements.

Accrued interest

Total accrued interest associated with our financings was $ 25,169,541 and $ 17,763,848 as of September 30, 2021 and December 31, 2020, respectively.

NOTE J – STOCKHOLDERS’ EQUITY (DEFICIT)

On August 21, 2020, we sold an aggregate of 2,553,314 shares of our common stock and warrants to purchase up to 1,901,985 shares of our common stock.

The net proceeds received from sale, after offering expenses of $ 0.3 million, of which $ 0.2 million were withheld to cover fees, were $ 11.3 million.

The shares of common stock and warrants were sold in units, with each unit consisting of one share of common stock and a warrant to purchase up to 0.6 shares of common stock.

The purchase price for each unit was $ 4.543 .

The warrants have an exercise price of $ 4.75 per share of common stock and are exercisable at any time during the three-year period commencing six months after issuance.

Convertible Preferred Stock

On March 11, 2015, we entered into a Stock Purchase Agreement (the “Purchase Agreement”) with Penelope Mining LLC (the “Investor”), and, solely with respect to certain provisions of the Purchase Agreement, Minera del Norte, S.A.

(the “Lender”).

The Purchase Agreement provides for the Company to issue and sell to the Investor shares of the Company’s preferred stock in the amounts set forth in the following table (numbers have been adjusted for the February 2016 reverse stock split):

Preferred Stock

Price Per Share

The Investor’s option to purchase the Series AA-2

shares is subject to the closing price of the Common Stock on the NASDAQ market having been greater than or equal to $ 15.12 per share for a period of twenty (20) consecutive business days on which the NASDAQ market is open.

The closing of the sale and issuance of shares of the Company’s preferred stock to the Investor is subject to certain conditions, including the Company’s receipt of required approvals from the Company’s stockholders, the receipt of regulatory approval, performance by the Company of its obligations under the Stock Purchase Agreement, the listing of the underlying common stock on the NASDAQ Stock Market and the Investor’s satisfaction, in its sole discretion, with the viability of certain undersea mining projects of the Company.

This transaction received stockholders’ approval on June 9, 2015.

Completion of the transaction requires amending the Company’s articles of incorporation to (a) effect a reverse stock split, which was done on February 19, 2016, (b) adjusting the Company’s authorized capitalization, which was also done on February 19, 2016, and (c) establishing a classified board of directors (collectively, the “Amendments”).

The Amendments have been or will be set forth in certificates of amendment to the Company’s articles of incorporation filed or to be filed with the Nevada Secretary of State.

Series AA Convertible Preferred Stock Designation

The Purchase Agreement provides for the issuance of up to 8,427,004 shares of Series AA-1

Convertible Preferred Stock, par value $ 0.0001 per share (the “Series AA-1

Preferred”) and 7,223,145 shares of Series AA-2

Convertible Preferred Stock, par value $ 0.0001 per share (the “Series AA-2

Preferred”), subject to stockholder approval which was received on June 9, 2015 and satisfaction of other conditions.

Significant terms and conditions of the Series AA Preferred are as follows:

If and when the Company declares a dividend and any other distribution (including, without limitation, in cash, in capital stock (which shall include, without limitation, any options, warrants or other rights to acquire capital stock) of the Company, then the holders of each share of Series AA Preferred Stock are entitled to receive, a dividend or distribution in an amount equal to the amount of dividend or distribution received by the holders of common stock for which such share of Series AA Preferred Stock is convertible.

Liquidation Preference

The Liquidation Preference on each share of Series AA Preferred Stock is its Stated Value plus accretion at the rate of 8 % per annum compounded on each December 31 from the date of issue of such share until the date such share is converted.

For any accretion period which is less than a full year, the Liquidation Preference shall accrete in an amount to be computed on the basis of a 360-day

year of twelve 30-day

months and the actual number of days elapsed.

Voting Rights

The holders of Series AA Preferred will be entitled to one vote for each share of common stock into which the Series AA Preferred is convertible and will be entitled to notice of meetings of stockholders.

Conversion Rights

At any time after the Preferred Shares have been issued, any holder of shares of Series AA Preferred may convert any or all of the shares of preferred stock into one fully paid and non-assessable

share of Common Stock.

Adjustments to Conversion Rights

If Odyssey pays a dividend or makes a distribution on its common stock in shares of common stock, subdivides its outstanding common stock into a greater number of shares, or combines its outstanding common stock into a smaller number of shares, or if there is a reorganization, or a merger or consolidation of Odyssey with or into any other entity which results in a conversion, exchange, or cancellation of the common stock, or a sale of all or substantially all of Odyssey’s assets, then the conversion rights described above will be adjusted appropriately so that each holder of Series AA Preferred will receive the securities or other consideration the holder would have received if the holder’s Series AA Preferred had been converted before the happening of the event.

The conversion price in effect from time to time is also subject to downward adjustment if we issue or sell shares of common stock for a purchase price less than the conversion price or if we issue or sell shares convertible into or exercisable for shares of common stock with a conversion price or exercise price less than the conversion price for the Series AA Preferred.

Accounting considerations

As stated above, the issuance of the Series AA Convertible Preferred Stock is subject to certain contingencies.

No accounting treatment determination is required until these contingencies are met and the Series AA Convertible Preferred Stock has been issued.

However, we have analyzed the instrument to determine the proper accounting treatment that will be necessary once the instruments have been issued.

ASC 480 generally requires liability classification for financial instruments that are certain to be redeemed, represent obligations to purchase shares of stock or represent obligations to issue a variable number of common shares.

We concluded that the Series AA Preferred was not within the scope of ASC 480 because none of the three conditions for liability classification was present.

However, in order to perform this analysis, we were first required to evaluate the economic risks and characteristics of the Series AA Convertible Preferred Stock in its entirety as being either akin to equity or akin to debt.

Our evaluation concluded that the Series AA Convertible Preferred Stock was more akin to an equity-like contract largely due to the fact that most of its features were participatory in nature.

As a result, we concluded that the embedded conversion feature is clearly and closely related to the host equity contract and will not require bifurcation and liability classification.

The option to purchase the Series AA-2

Convertible Preferred Stock was analyzed as a freestanding financial instrument and has terms and features of derivative financial instruments.

However, in analyzing this instrument under applicable guidance it was determined that it is both (i) indexed to the Company’s stock and (ii) meet the conditions for equity classification.

In conjunction with the Note and Warrant Purchase Agreement related to Note 8 – Promissory note 2018 in NOTE I, we originally issued warrants to purchase an aggregate of 65,625 shares of common stock in connection with the notes that were issued.

These warrants had an expiration date of July 21, 2021 , an exercise price of $ 12.00 , and were exercisable to purchase 65,625 shares of our common stock.

On July 8, 2019 we entered into a Second Amendment to Note and Warrant Purchase Agreement and Warrant Modification Agreement.

As a result, the lenders now hold warrants to purchase an aggregate of 196,135 shares of our common stock at an exercise price of $ 5.756 per share.

These warrants are exercisable at any time until July 12, 2024 .

On August 14, 2020, this loan was modified and extended to July 12, 2021.

In conjunction with the extension, the lenders received warrants to purchase an aggregate of 131,996 shares of our common stock at $ 4.67 per share.

These warrants expire on August 14, 2023 .

Included in the Restated Agreement as described in NOTE I, Note 9 – Litigation financing, during 2019, we issued a warrant allowing the lender to purchase up to 551,378 shares of our common stock at $ 3.99 .

The warrant is contingently exercisable and will become exercisable on the date on which we cease the Subject Claim for any reason other than (i) a full and final arbitral award against the Claimholder or (ii) a full and final monetary settlement of the claims or the date on which Proceeds are deposited into the Escrow Account.

The warrant has a five-year life that commences on the date it becomes exercisable.

In conjunction with our sale of shares common stock and warrants on August 21, 2020 as described above in Note J, we issued warrants to purchase up to 1,901,985 shares of our common stock.

The warrants have an exercise price of $ 4.75 per share and are exercisable at any time during the three-year period commencing six months after issuance which is February 25, 2024.

Stock-Based Compensation

We have three stock incentive plans.

The first is the 2005 Stock Incentive Plan that expired in August 2015.

After the expiration of this plan, equity instruments cannot be granted but this plan will continue in effect until all outstanding awards have been exercised in full or are no longer exercisable and all equity instruments have vested or been forfeited.

On June 9, 2015, our stockholders approved our 2015 Stock Incentive Plan (the “Plan”) that was adopted by our Board of Directors (the “Board”) on January 2, 2015, which is the effective date.

The plan expires on the tenth anniversary of the effective date.

The Plan provides for the grant of incentive stock options, non-qualified

stock options, restricted stock awards, restricted stock units and stock appreciation rights.

This plan was initially capitalized with 450,000 shares that may be granted.

The Plan is intended to comply with Section 162(m) of the Internal Revenue Code, which stipulates that the maximum aggregate number of Shares with respect to one or more Awards that may be granted to any one person during any calendar year shall be 83,333 , and the maximum aggregate amount of cash that may be paid in cash to any person during any calendar year with respect to one or more Awards payable in cash shall be $ 2,000,000 .

The original maximum number of shares that were to be used for Incentive Stock Options (“ISO”) under the Plan was 450,000 .

During our June 2016 stockholders meeting, the stockholders approved the addition of 200,000 incremental shares to the Plan.

With respect to each grant of an ISO to a participant who is not a ten percent stockholder, the exercise price shall not be less than the fair market value of a share on the date the ISO is granted.

With respect to each grant of an ISO to a participant who is a ten percent stockholder, the exercise price shall not be less than one hundred ten percent ( 110 %) of the fair market value of a share on the date the ISO is granted.

If an award is a non-qualified

stock option (“NQSO”), the exercise price for each share shall be no less than (1) the minimum price required by applicable state law, or (2) the fair market value of a share on the date the NQSO is granted, whichever price is greatest.

Any award intended to meet the performance-based exception must be granted with an exercise price not less than the fair market value of a share determined as of the date of such grant.

On March 26, 2019, our Board of Directors adopted and approved the 2019 Stock Incentive Plan (the “2019 Plan”), which was approved by our stockholders on June 3, 2019.

The 2019 Plan expires on June 3, 2029.

The 2019 Plan provides for the grant of incentive stock options, non-qualified

stock options, restricted stock awards, restricted stock units and stock appreciation rights.

The 2019 Plan is capitalized with 800,000 shares that may be granted.

No awards were made from the Plan prior to the effective date.

The 2019 Plan includes the following features:

no “evergreen” share reserve, prohibits liberal share recycling, no repricing permitted without stockholder approval, no stock option reload features, no transfers of awards for value and dividends and dividends equivalent shall accrue and be paid only if and to the extent the common stock underlying the award become vested or payable.

Share-based compensation expense recognized during the period is based on the value of the portion of share-based payment awards that is ultimately expected to vest.

As share-based compensation expense recognized in the statement of operations is based on awards ultimately expected to vest, it can be reduced for estimated forfeitures.

The ASC topic Stock Compensation requires forfeitures to be estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates.

The share-based compensation charged against income for the three month periods ended September 30, 2021 and 2020, was $ 312,646 and $ 105,162 , respectively.

The share-based compensation charged against income for the nine-month periods ended September 30, 2021 and 2020 was $ 937,939 and $ 315,486 , respectively.

We did no t grant stock options to employees or outside directors in the three and nine months ended September 30, 2021 or 2020.

If options were granted, their values would be determined using the Black-Scholes-Merton option-pricing model, which values options based on the stock price at the grant date, the expected life of the option, the estimated volatility of the stock, the expected dividend payments, and the risk-free interest rate over the life of the option.

The Black-Scholes-Merton option pricing model was developed for estimating the fair value of traded options that have no vesting restrictions and are fully transferable.

Because option valuation models require the use of subjective assumptions, changes in these assumptions can materially affect the fair value of the options.

Our options do not have the characteristics of traded options;

therefore, the option valuation models do not necessarily provide a reliable measure of the fair value of our options.

NOTE K – CONCENTRATION OF CREDIT RISK

no t currently have any debt obligations with variable interest rates.

NOTE L – REVENUE PARTICIPATION RIGHTS

The Company’s participating revenue rights consisted of the following at:

September 30, 2021

December 31, 2020

Galt Resources, LLC (HMS Victory

Total revenue participation rights

In a private placement that closed in September 2000, we sold “units” consisting of “ Republic”

Revenue Participation Certificates and Common Stock.

Each $ 50,000 “unit” entitled the holder to 1 % of the gross revenue generated by the now named “ Seattle

” project (formerly referred to as the “ Republic

” project), and 100,000 shares of Common Stock.

Gross revenue is defined as all cash proceeds payable to us as a result of the “ Seattle

” project, excluding funds received by us to finance the project.

The participation rights balance was to be amortized under the units of revenue method once management was able to reasonably estimate potential revenue for this project.

The RPCs for the “ Seattle

project do not have a termination date;

therefore, these liabilities were to be carried on the books until revenue is recognized from the project or we permanently abandon the project, which was confirmed by management in June 2021.

Therefore, the amount was written off and is included in Other income (expense) in our Consolidated Statements of Operations.

Galt Resources, LLC

In February 2011, we entered into a project syndication deal with Galt Resources LLC (“Galt”) for which they invested $ 7,512,500 representing rights to future revenues of any one project Galt selected prior to December 31, 2011.

If the project is successful and generates sufficient proceeds, Galt will recoup their investment plus three times the investment.

Galt’s investment return will be paid out of project proceeds.

Galt will receive 50 % of project proceeds until this amount is recouped.

Thereafter, they will share in additional net proceeds of the project at the rate of 1 % for every million invested.

Subsequent to the original syndication deal, we reached an agreement permitting Galt to bifurcate their selection between two projects, the SS Gairsoppa

and HMS Victory

with the residual 1% on additional net proceeds assigned to the HMS Victory

project only.

The bifurcation resulted in $ 3,756,250 being allocated to each of the two projects.

Therefore, Galt was en titled to re c

7.5125 % of net proceeds from the HMS Victory

project after they recoup their investment of $3,756,250 plus three times the investment.

Galt has been paid in full for their share of the Gairsoppa

project investment.

There are no future payments remaining due to Galt for the Gairsoppa

Based on the timing of the proceeds earmarked for Galt, the relative corresponding amount of Galt’s revenue participation right of $3,756,250 was amortized into revenue in 2012 based upon the percent of Galt-related proceeds from the sale of silver as a percentage of total proceeds that Galt earned under the revenue participation agreement ($ 15.0 million).

There was no expiration date on the Galt deal for the HMS Victory

If the archaeological excavation of the shipwreck is performed and insufficient proceeds obtained, then the deferred income balance would be recognized as other income.

If the archaeological excavation of the shipwreck was performed and sufficient proceeds obtained, then the deferred income balance would be recognized as revenue.

This project syndication agreement was mutually terminated in June 2021.

Therefore, the carrying amount was written off to Other income (expense) in our Consolidated Statements of Operations.

NOTE M – SUBSEQUENT EVENT

On October 4, 2021, we and Monaco Financial, LLC and certain associated entities (collectively with Monaco, the “Monaco Parties”) entered into a Termination and Settlement Agreement (the “Termination Agreement”).

We were parties to various loan arrangements and other commercial contractual relationships, and the purposes of the Termination Agreement were to terminate the loan agreements and contractual relationships and to settle the outstanding obligations thereunder between us and the Monaco Parties.

As for loan arrangements that relate to this transaction, see above notes:

Note 1 Monaco – 2014, Note 2 Monaco – 2016, Note 5 SMOM and Note 7 Monaco – 2018.

Pursuant to the Termination Agreement, the loan agreements and contractual relationships were terminated, and we agreed to (a) issue 984,848 shares of our common stock (the “Settlement Shares”) to Monaco and (b) pay Monaco an aggregate amount of $ 3.0 million (the “Settlement Cash”) no later than December 1, 2021.

The Settlement Shares were issued at a price equal to $ 6.60 per share, totaling $ 6.5 million, which was negotiated by the parties with reference to the recent market prices of our common stock and the other terms of the Termination Agreement.

We delivered $ 500,000 of the Settlement Cash to Monaco upon execution and delivery of the Termination Agreement.

At Monaco’s option, Monaco has the right, but not the obligation, to receive the remaining

$ 2.5 million in shares of our common stock rather than in cash.

If Monaco exercises the right, Odyssey will issue to Monaco the number of shares determined by dividing

2.5 million by the greater of $

90 % of the then-applicable

five-day volume-weighted

average price per share of common stock.

Under the terms of the Termination Agreement, (a) the Monaco Parties agreed that approximately $

million of indebtedness, which includes accrued interest, owed by us to the Monaco Parties was satisfied in full and (b) certain of the Monaco Parties assigned to us all of their right, title, and interest in a portion of the proceeds from a specified shipwreck project.

If received by us, these proceeds will be applied to the

2.5 million obligation.

As a result of the termination of the loan agreements and contractual relationships, (x) our right to receive a percentage of the proceeds derived by the Monaco Parties from certain shipwreck projects was terminated, and (y) Monaco’s option to convert certain indebtedness held by it into shares of Oceanica Resources, S.

held indirectly by us was terminated.

The Termination Agreement also sets forth mutual releases and other customary representations, warranties, and covenants of the parties.

We are in the process of determining the accounting for this transaction.

The shares of common stock issuable under the Termination Agreement were offered and sold pursuant to a base prospectus and a prospectus supplement, both filed pursuant to Odyssey’s shelf registration statement on Form S-3

0333-227666).

Total accrued interest associated with our financings was $

24,719,363 and $

21,875,753 as of March 31, 2022 and December 31, 2021, respectively.

Accrued interest is included in accrued expenses on the accompanying condensed consolidated balance sheets.

NOTE I – STOCK-BASED COMPENSATION

The share-based compensation charged against income, related to our restricted stock units, for the three month periods ended March 31, 2022 and 2021, was

and $ 281,687 , respectively.

We did no t grant stock options to employees or outside directors in the three ended March 31, 2022 or 2021.

NOTE J – CONCENTRATION OF CREDIT RISK

currently have any debt obligations with variable interest rates.

NOTE K – SUBSEQUENT EVENT

We have evaluated subsequent events for recognition or disclosure through the date of this Form

is filed with the SEC.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements