UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
For the quarterly period ended
or
For the transition period from _____ to _____
Commission File Number:
(Exact name of registrant as specified in its charter)
| (State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) |
| (Address of principal executive offices) | (Zip Code) |
954-587-6280
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act.
| Title of each class | Trading Symbol | Name of each exchange on which registered | ||
| The |
Indicate by check mark whether the registrant
(1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements
for the past 90 days.
Indicate by check mark whether the registrant
has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding
12 months (or for such shorter period that the registrant was required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| Large accelerated filer | ☐ | Accelerated filer | ☐ |
| | ☒ | Smaller reporting company | |
| Emerging growth company |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant
is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No
At August 3, 2022,
OCEAN BIO-CHEM, INC. AND SUBSIDIARIES
TABLE OF CONTENTS
i
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
OCEAN BIO-CHEM, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
| June 30, 2022 | December 31, 2021 | |||||||
| (Unaudited) | ||||||||
| ASSETS | ||||||||
| Current Assets: | ||||||||
| Cash | $ | $ | ||||||
| Trade accounts receivable less allowances of approximately $ | ||||||||
| Receivables due from affiliated companies | ||||||||
| Inventories, net | ||||||||
| Prepaid expenses and other current assets | ||||||||
| Total Current Assets | ||||||||
| Property, plant and equipment, net | ||||||||
| Operating lease – right to use | ||||||||
| Intangible assets, net | ||||||||
| Total Assets | $ | $ | ||||||
| LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||
| Current Liabilities: | ||||||||
| Current portion of long-term debt, net | $ | $ | ||||||
| Revolving line of credit | - | |||||||
| Current portion of operating lease liability | ||||||||
| Accounts payable - trade | ||||||||
| Income taxes payable | ||||||||
| Accrued expenses payable | ||||||||
| Total Current Liabilities | ||||||||
| Deferred tax liability | ||||||||
| Operating lease liability, less current portion | ||||||||
| Long-term debt, less current portion and debt issuance costs | ||||||||
| Total Liabilities | ||||||||
| COMMITMENTS AND CONTINGENCIES | ||||||||
| Shareholders’ Equity: | ||||||||
| Common stock - $ | ||||||||
| Additional paid in capital | ||||||||
| Accumulated other comprehensive loss | ( | ) | ( | ) | ||||
| Retained earnings | ||||||||
| Total Shareholders’ Equity | ||||||||
| Total Liabilities and Shareholders’ Equity | $ | $ | ||||||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
1
OCEAN BIO-CHEM, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
| Three Months Ended | Six Months Ended | |||||||||||||||
| June 30, | June 30, | |||||||||||||||
| 2022 | 2021 | 2022 | 2021 | |||||||||||||
| Net sales | $ | $ | $ | $ | ||||||||||||
| Cost of goods sold | ||||||||||||||||
| Gross profit | ||||||||||||||||
| Operating Expenses: | ||||||||||||||||
| Advertising and promotion | ||||||||||||||||
| Selling and administrative | ||||||||||||||||
| Total operating expenses | ||||||||||||||||
| Operating (loss) income | ( | ) | ||||||||||||||
| Other (expense) income | ||||||||||||||||
| Interest (expense), net | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| (Loss) income before income taxes | ( | ) | ||||||||||||||
| Income tax benefit (provision) | ( | ) | ( | ) | ( | ) | ||||||||||
| Net (loss) income | $ | ( | ) | $ | $ | $ | ||||||||||
| Loss (earnings) per common share | $ | ( | ) | $ | $ | $ | ||||||||||
| Dividends declared per common share | $ | $ | $ | $ | ||||||||||||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
2
OCEAN BIO-CHEM, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME
(UNAUDITED)
| Three Months Ended | Six Months Ended | |||||||||||||||
| June 30, | June 30, | |||||||||||||||
| 2022 | 2021 | 2022 | 2021 | |||||||||||||
| Net (loss) income | $ | ( | ) | $ | $ | $ | ||||||||||
| Foreign currency translation adjustment | ( | ) | ||||||||||||||
| Comprehensive (loss) income | $ | ( | ) | $ | $ | $ | ||||||||||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
3
OCEAN BIO-CHEM, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY
THREE MONTHS ENDED JUNE 30, 2022 AND 2021
(UNAUDITED)
| Additional | Accumulated Other | |||||||||||||||||||||||
| Common Stock | Paid In | Comprehensive | Retained | |||||||||||||||||||||
| Shares | Amount | Capital | Loss | Earnings | Total | |||||||||||||||||||
| March 31, 2022 | $ | $ | $ | ( | ) | $ | $ | |||||||||||||||||
| Net loss | - | ( | ) | ( | ) | |||||||||||||||||||
| Dividends, common stock | - | ( | ) | ( | ) | |||||||||||||||||||
| Foreign currency translation adjustment | - | ( | ) | ( | ) | |||||||||||||||||||
| June 30, 2022 | $ | $ | $ | ( | ) | $ | $ | |||||||||||||||||
| Additional | Accumulated Other | |||||||||||||||||||||||
| Common Stock | Paid In | Comprehensive | Retained | |||||||||||||||||||||
| Shares | Amount | Capital | Loss | Earnings | Total | |||||||||||||||||||
| March 31, 2021 | $ | $ | $ | ( | ) | $ | $ | |||||||||||||||||
| Net income | - | |||||||||||||||||||||||
| Dividends, common stock | - | ( | ) | ( | ) | |||||||||||||||||||
| Stock based compensation | ||||||||||||||||||||||||
| Foreign currency translation adjustment | - | |||||||||||||||||||||||
| June 30, 2021 | $ | $ | $ | ( | ) | $ | $ | |||||||||||||||||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
4
OCEAN BIO-CHEM, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY
SIX MONTHS ENDED JUNE 30, 2022 AND 2021
(UNAUDITED)
| Additional | Accumulated Other | |||||||||||||||||||||||
| Common Stock | Paid In | Comprehensive | Retained | |||||||||||||||||||||
| Shares | Amount | Capital | Loss | Earnings | Total | |||||||||||||||||||
| December 31, 2021 | $ | $ | $ | ( | ) | $ | $ | |||||||||||||||||
| Net income | - | |||||||||||||||||||||||
| Dividends, common stock | - | ( | ) | ( | ) | |||||||||||||||||||
| Common stock repurchased and retired | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||||||
| Portion of 2021 stock based compensation for shares issued in 2022 | ||||||||||||||||||||||||
| Foreign currency translation adjustment | - | |||||||||||||||||||||||
| June 30, 2022 | $ | $ | $ | ( | ) | $ | $ | |||||||||||||||||
| Additional | Accumulated Other | |||||||||||||||||||||||
| Common Stock | Paid In | Comprehensive | Retained | |||||||||||||||||||||
| Shares | Amount | Capital | Loss | Earnings | Total | |||||||||||||||||||
| December 31, 2020 | $ | $ | $ | ( | ) | $ | $ | |||||||||||||||||
| Net income | - | |||||||||||||||||||||||
| Dividends, common stock | - | ( | ) | ( | ) | |||||||||||||||||||
| Stock based compensation | ||||||||||||||||||||||||
| Foreign currency translation adjustment | - | |||||||||||||||||||||||
| June 30, 2021 | $ | $ | $ | ( | ) | $ | $ | |||||||||||||||||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
5
OCEAN BIO-CHEM, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
| Six Months Ended | ||||||||
| June 30, | ||||||||
| 2022 | 2021 | |||||||
| Cash flows from operating activities: | ||||||||
| Net income | $ | $ | ||||||
| Adjustments to reconcile net income to net cash (used in) provided by operating activities: | ||||||||
| Depreciation and amortization | ||||||||
| Deferred income taxes | ||||||||
| Stock based compensation | ||||||||
| Provision for bad debts | ||||||||
| Provision for slow moving and obsolete inventory | ||||||||
| Other operating non-cash items | ( | ) | ||||||
| Changes in assets and liabilities: | ||||||||
| Trade accounts receivable | ( | ) | ( | ) | ||||
| Receivables due from affiliated companies | ( | ) | ||||||
| Inventories | ( | ) | ( | ) | ||||
| Prepaid expenses and other current assets | ( | ) | ||||||
| Accounts payable – trade | ||||||||
| Income taxes payable | ( | ) | ||||||
| Accrued expenses payable | ||||||||
| Net cash (used in) provided by operating activities | ( | ) | ||||||
| Cash flows from investing activities: | ||||||||
| Purchases of property, plant and equipment | ( | ) | ( | ) | ||||
| Net cash used in investing activities | ( | ) | ( | ) | ||||
| Cash flows from financing activities: | ||||||||
| Borrowings on revolving line of credit | ||||||||
| Payments on long-term debt | ( | ) | ( | ) | ||||
| Dividends paid to common shareholders | ( | ) | ( | ) | ||||
| Repurchase of common stock | ( | ) | ||||||
| Net cash provided by (used) in financing activities | ( | ) | ||||||
| Effect of exchange rate on cash | ( | ) | ||||||
| Net decrease in cash and restricted cash | ( | ) | ( | ) | ||||
| Cash and restricted cash at beginning of period | ||||||||
| Cash and restricted cash at end of period | $ | $ | ||||||
| Supplemental disclosure of cash flow information: | ||||||||
| Cash paid for interest during period | $ | $ | ||||||
| Cash paid for income taxes during period | $ | $ | ||||||
| Cash paid under operating lease | $ | $ | ||||||
| Cash | $ | $ | ||||||
| Restricted cash | ||||||||
| Total cash and restricted cash | $ | $ | ||||||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
6
OCEAN BIO-CHEM, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
| 1. | SUMMARY OF ACCOUNTING POLICIES |
Interim reporting
The accompanying unaudited condensed consolidated financial statements include the accounts of Ocean Bio-Chem, Inc. and its wholly owned subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation. Unless the context indicates otherwise, the term “Company” refers to Ocean Bio-Chem, Inc. and its subsidiaries.
The unaudited condensed consolidated financial statements have been prepared in accordance with United States generally accepted accounting principles (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 8 of Securities and Exchange Commission Regulation S-X. Accordingly, they do not include all the information and footnotes required by GAAP for complete financial statements.
The financial information furnished herein reflects all adjustments, consisting of normal recurring items that, in the opinion of management, are necessary for a fair presentation of the Company’s financial position, results of operations and cash flows for the interim periods. The results of operations for the three and six months ended June 30, 2022 are not necessarily indicative of the results to be expected for the year ending December 31, 2022.
The information included in this Form 10-Q should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended December 31, 2021.
Use of estimates
The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates and assumptions.
| 2. | INVENTORIES |
The Company’s inventories at June 30, 2022 and December 31, 2021 consisted of the following:
June 30, 2022 | December 31, 2021 | |||||||
| Raw materials | $ | $ | ||||||
| Finished goods | ||||||||
| Inventories, gross | ||||||||
| Inventory reserves | ( | ) | ( | ) | ||||
| Inventories, net | $ | $ | ||||||
The inventory reserves shown in the table above reflect slow moving and obsolete inventory.
The Company operates a vendor managed inventory
program with one of its customers to improve the promotion of the Company’s products. The Company manages the inventory levels at
this customer’s warehouses and recognizes revenue as the products are sold by the customer. The inventories managed at the customer’s
warehouses, which are included in inventories, net, amounted to approximately $
7
| 3. | PROPERTY, PLANT & EQUIPMENT |
The Company’s property, plant and equipment at June 30, 2022 and December 31, 2021 consisted of the following:
Estimated Useful Life | June 30, 2022 | December 31, 2021 | ||||||||
| Land | $ | $ | ||||||||
| Building and improvements | ||||||||||
| Manufacturing and warehouse equipment | ||||||||||
| Office equipment and furniture | ||||||||||
| Leasehold improvements | ||||||||||
| Finance leases – right to use | ||||||||||
| Vehicles | ||||||||||
| Construction in process | ||||||||||
| Property, plant and equipment, gross | ||||||||||
| Less accumulated depreciation | ( | ) | ( | ) | ||||||
| Property, plant and equipment, net | $ | $ | ||||||||
Depreciation
expense totaled $
| 4. | LEASES |
The Company has one operating lease and two finance leases.
Under the operating lease, the Company leases
its executive offices and warehouse facilities in Fort Lauderdale, Florida from an entity controlled by Peter G. Dornau, the Company’s
Chairman, President and Chief Executive Officer. The lease, as extended, expires on
| Twelve-month period ending June 30, | ||||
| 2023 | $ | |||
| 2024 | ||||
| Total future minimum lease payments | ||||
| Less imputed interest | ( | ) | ||
| Total operating lease liability | $ | |||
The Company’s two finance leases relate to office equipment. See Note 3 for information regarding the carrying value of the Company’s finance lease right to use assets and Note 7 for information regarding the finance lease payment schedule.
8
Expenses incurred with respect to the Company’s leases during the three and six months ended June 30, 2022 and 2021 are set forth below.
| Three Months Ended June 30, 2022 | Three Months Ended | |||||||
| Operating lease expense | $ | $ | ||||||
| Finance lease amortization | ||||||||
| Finance lease interest | ||||||||
| Total lease expense | $ | $ | ||||||
| Six Months Ended June 30, 2022 | Six Months Ended | |||||||
| Operating lease expense | $ | $ | ||||||
| Finance lease amortization | ||||||||
| Finance lease interest | ||||||||
| Total lease expense | $ | $ | ||||||
The remaining lease term with respect to the operating lease, weighted average remaining lease term with respect to the finance leases and discount rate with respect to the operating lease and finance leases at June 30, 2022 and December 31, 2021 are set forth below:
| June 30, 2022 | ||||
| Remaining lease term – operating lease | ||||
| Weighted average remaining lease term – finance leases | ||||
| Discount rate – operating lease | % | |||
| Weighted average discount rate – finance leases | % | |||
| December 31, 2021 | ||||
| Remaining lease term – operating lease | ||||
| Weighted average remaining lease term – finance leases | ||||
| Discount rate – operating lease | % | |||
| Weighted average discount rate – finance leases | % | |||
9
| 5. | INTANGIBLE ASSETS |
The Company’s intangible assets at June 30, 2022 and December 31, 2021 consisted of the following:
June 30, 2022
| Intangible Assets | Cost | Accumulated Amortization | Net | |||||||||
| Patents | $ | $ | $ | |||||||||
| Trade names and trademarks | ||||||||||||
| Customer list | ||||||||||||
| Product formulas | ||||||||||||
| Royalty rights | ||||||||||||
| Total intangible assets | $ | $ | $ | |||||||||
| December 31, 2021 | ||||||||||||
| Intangible Assets | Cost | Accumulated Amortization |
Net | |||||||||
| Patents | $ | $ | $ | |||||||||
| Trade names and trademarks | ||||||||||||
| Customer list | ||||||||||||
| Product formulas | ||||||||||||
| Royalty rights | ||||||||||||
| Total intangible assets | $ | $ | $ | |||||||||
Amortization
expense related to intangible assets was $
| 6. | REVOLVING LINE OF CREDIT |
On August 6, 2021, the Company and Regions Bank
(“the “Lender”) entered into a Business Loan Agreement (the “Business Loan Agreement”), effective as of
July 30, 2021, under which the Company was provided a revolving line of credit in the amount of Six Million Dollars ($
There has been no negative impact in the availability of funds to the Company as a result of the COVID-19 pandemic.
At June 30, 2022 and December 31, 2021, the Company
had borrowings of $
10
| 7. | LONG TERM DEBT |
Term Loan
On July 30, 2021, Kinpak and Regions Bank
(the “Lender”) entered into a Credit Agreement (the “Credit Agreement”), effective as of July 20, 2021, under
which the Company was extended a term loan (the “Term Loan”) in the original principal amount of Five Million Dollars ($
The Company has unconditionally guaranteed the payment to the Lender promptly when due, by acceleration or otherwise, of all obligations of Kinpak to the Lender.
The Term Loan bears interest at an annual rate of 3.25% and is due in 119 monthly installments of $35,249 each, plus interest then accrued, beginning on August 20, 2021. The final installment shall be due and payable on July 20, 2031 in an amount equal to all principal and interest then remaining unpaid. Assuming that all amounts due prior to that date are paid in a timely manner, the final installment would be $1,977,047.
The Credit Agreement provides that prepayments
on the Term Loan are subject to a prepayment penalty of
The Credit Agreement contains cross-default and
cross-collateral provisions relating to any other indebtedness with the Lender, including without limitation the Company’s obligations
under its $
The Credit Agreement also contains negative covenants
restricting the Company’s ability to, among other things, create or assume indebtedness for borrowed money exceeding $
11
Industrial Development Bond Financing
On September 26, 2017, Kinpak indirectly obtained
a $
The loan was funded by the Lender’s purchase
of a $
Under the Lease, Kinpak is required to make rental
payments for the account of the IDB to the Lender in such amounts and at such times as are necessary to enable the payment of all principal
and interest due on the Bond and other charges, if any, payable in respect of the Bond. The Lease also provides that Kinpak may redeem
the Bond, in whole or in part, by prepaying its rental payment obligations in an amount sufficient to effect the redemption.
Payment of amounts due and payable under the
Bond and other related agreements are guaranteed by the Company and its other consolidated subsidiaries. In connection with the guarantee
agreement under which the Company provided its guarantee,
The Company incurred debt financing costs of
$
12
Other Long-Term Obligations
On June 22, 2020,
At June 30, 2022 and December 31, 2021, the Company
was obligated under lease agreements covering office equipment utilized in the Company’s operations (inclusive of the lease referenced
in the preceding paragraph). The office equipment leases, aggregating approximately $
The following table provides information regarding the Company’s long-term debt at June 30, 2022 and December 31, 2021:
| Current Portion | Long Term Portion | |||||||||||||||
| June 30, 2022 | December 31, 2021 | June 30, 2022 | December 31, 2021 | |||||||||||||
| Term loan | $ | $ | $ | $ | ||||||||||||
| Obligations related to industrial development bond financing | ||||||||||||||||
| Note payable related to Snappy Marine asset acquisition | ||||||||||||||||
| Office equipment finance leases | ||||||||||||||||
| Total principal of long- term debt | ||||||||||||||||
| Debt issuance costs | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Total long- term debt | $ | $ | $ | $ | ||||||||||||
Required principal payments under the Company’s long- term obligations are set forth below:
| Twelve-month period ending June 30, | ||||
| 2023 | $ | |||
| 2024 | ||||
| 2025 | ||||
| 2026 | ||||
| 2027 | ||||
| Thereafter | ||||
| Total | $ | |||
13
| 8. | RELATED PARTY TRANSACTIONS |
The Company sells products to companies affiliated
with Peter G. Dornau, who is the Company’s Chairman, President and Chief Executive Officer. The affiliated companies resell, outside
of the United States and Canada, products they purchase from the Company. The Company also provides administrative services to these
companies and pays certain business-related expenditures for the affiliated companies, for which the Company is reimbursed. Sales to
the affiliated companies aggregated approximately $
An entity that is owned by the Company’s
Chairman, President and Chief Executive Officer provides several services to the Company. Under this arrangement, the Company
paid the entity an aggregate of $
The Company leases office and warehouse facilities in Fort Lauderdale, Florida from an entity controlled by its Chairman, President and Chief Executive Officer. See Note 4 for a description of the lease terms.
See Note 13, Merger Agreement, for a discussion of certain transaction relating to the above-described entities.
A director of the Company is Regional Executive
Vice President of an insurance broker through which the Company sources most of its insurance needs. During the three months
ended June 30, 2022 and 2021, the Company paid an aggregate of approximately $
| 9. | (LOSS) EARNINGS PER COMMON SHARE |
The Company did not have any potentially dilutive securities during the three and six months ended June 30, 2022 and 2021. Therefore, the Company’s earnings per share are calculated by dividing net income by the weighted average number of shares outstanding during the reporting period.
| Three Months Ended June 30, |
Six Months Ended June 30, |
|||||||||||||||
| 2022 | 2021 | 2022 | 2021 | |||||||||||||
| Net (loss) income | $ | ( |
$ | $ | $ | |||||||||||
| Weighted average number of common shares outstanding | ||||||||||||||||
| (Loss) earnings per common share | $ | ( |
$ | $ | $ | |||||||||||
14
| 10. | SECURITIES AUTHORIZED FOR ISSUANCE UNDER EQUITY COMPENSATION PLANS |
| 11. | CASH DIVIDENDS |
Six months ended June 30, 2022
Declaration Date | Type | Record Date | Payment Date | Dividends Per Share | Amount | |||||||||
| $ | $ | |||||||||||||
| $ | $ | |||||||||||||
Six months ended June 30, 2021
Declaration Date |
Type |
Record Date |
Payment Date | Dividends Per Share |
Amount | |||||||||
| $ | $ | |||||||||||||
| $ | $ | |||||||||||||
| 12. | CUSTOMER CONCENTRATION |
During the three months
ended June 30, 2022, the Company had net sales to each of two customers that
During the three months
ended June 30, 2021, the Company had net sales to each of three customers that
During the six months
ended June 30, 2022 and 2021, the Company had net sales to each of two customers that
At June 30, 2022 and December 31, 2021,
| 13. | MERGER AGREEMENT |
On June 22, 2022, the Company announced that it had entered into an Agreement and Plan of Merger (the “Merger Agreement”), dated as of June 21, 2022, with OneWater Marine Inc., a Delaware corporation (“Parent”), and OBCMS, Inc., a Florida corporation, and a wholly owned subsidiary of Parent (“Merger Sub”), pursuant to which Merger Sub will be merged with and into the Company (the “Merger”) with the Company continuing as the surviving corporation (the “Surviving Corporation”) and wholly owned subsidiary of Parent following the effectiveness of the Merger.
15
At the effective time of the Merger (the “Effective Time”):
| 1. | each share of the Company common stock that is owned by the Company (as treasury stock or otherwise) or any of its direct or indirect wholly owned subsidiaries as of immediately prior to the Effective Time (“Cancelled Shares”) will automatically be cancelled and retired and will cease to exist, and no consideration will be delivered in exchange; |
| 2. | each share of Company common stock issued and outstanding immediately prior to the Effective Time (other
than Cancelled Shares and Dissenting Shares as defined by the Merger Agreement) will be converted into the right to receive $ |
| 3. | all shares of Company common stock will no longer be outstanding and all shares of Company common stock will be cancelled and retired and will cease to exist, and, subject to Section 2.03 of the merger agreement, each holder of: (i) a certificate formerly representing any shares of Company common stock; or (ii) any book-entry shares which immediately prior to the Effective Time represented shares of Company common stock will, subject to applicable Law in the case of Dissenting Shares, cease to have any rights with respect thereto, except the right to receive the Merger Consideration in accordance with Section 2.02 of the Merger Agreement; and |
| 4. | each share of common stock, par value $ |
Entry into the Merger Agreement has been unanimously approved by the board of directors of the Company, based in part on the recommendation of a special committee of the board of directors composed entirely of directors who are not parties to the Merger directly or indirectly, other than as a result of being a shareholder of the Company, and who have no direct or indirect material financial interest or other material interest in the Merger.
Following execution of the Merger Agreement on June 21, 2022, holders of a majority of the issued and outstanding shares of Company common stock (the “Consenting Shareholders”) duly executed and delivered to the Company a written consent (the “Written Consent”), approving and adopting the Merger Agreement and the transactions contemplated thereby, including the Merger. No further approval of the Company’s shareholders is required to adopt the Merger Agreement or will be sought. As a result of receipt of the Written Consent, the Company is prohibited from engaging in any further discussions or solicitations regarding an alternative potential acquisition of the Company.
The consummation of the Merger is subject to customary
closing conditions, including (i) receiving the approval of holders of a majority of the voting power of the outstanding Company common
stock, which approval was effected after execution of the Merger Agreement through the Written Consent, (ii) the absence of legal restraints
preventing the consummation of the Merger, (iii) the expiration or termination of the applicable waiting period under the Hart-Scott-Rodino
Antitrust Improvements Act of 1976, as amended, (iv) the payoff of certain indebtedness of the Company and (v) the closing or satisfaction
or waiver of the closing conditions of transactions in which (A) Peter G. Dornau, the Chairman of the Board, President and Chief Executive
Officer of the Company, and Mr. Dornau’s wife, will, pursuant to an equity purchase agreement entered into in connection with the
Merger Agreement, sell to an affiliate of Parent and Merger Sub all of the issued and outstanding shares of common stock of Star Brite
Europe, Inc. for an aggregate purchase price of $
The Merger Agreement includes customary representations, warranties and covenants of the Company, Parent and Merger Sub. Among other things, the Company has agreed to use commercially reasonable efforts to conduct its business in the ordinary course of business consistent with past practice and use commercially reasonable efforts to preserve intact its businesses until the Merger is consummated. The Company and Parent have also agreed to use their respective reasonable best efforts to obtain any approvals from governmental authorities for the Merger, including all required antitrust approvals, on the terms and subject to the conditions set forth in the Merger Agreement.
The Merger Agreement contains certain provisions
giving each of Parent and the Company rights to terminate the Merger Agreement under certain circumstances, including the right for either
Parent or the Company to terminate the Merger Agreement if the Merger has not been consummated on or before September 30, 2022. Upon termination
of the Merger Agreement under specified circumstances, the Company will be required to pay Parent a termination fee of $
A copy of the Merger Agreement can be found as an exhibit to the Company’s Current Report on Form 8-K filed on June 22, 2022.
During the three and six months ended June 30, 2022,
the Company incurred approximately $
The closing of the Merger is expected to occur during the quarter ending September 30, 2022.
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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
Forward-looking Statements:
Certain statements contained in this Quarterly Report on Form 10-Q, including without limitation, our ability to provide required capital to support inventory levels, the effect of price increases in raw materials that are petroleum or chemical based or commodity chemicals on our margins, and the sufficiency of funds provided through operations and existing sources of financing to satisfy our cash requirements constitute forward-looking statements. For this purpose, any statements contained in this report that are not statements of historical fact may be deemed to be forward-looking statements. Without limiting the generality of the foregoing, words such as “believe,” “may,” “will,” “expect,” “anticipate,” “intend,” or “could,” including the negative or other variations thereof or comparable terminology, are intended to identify forward-looking statements. These statements are subject to known and unknown risks, uncertainties and other factors that may cause actual results to be materially different from those expressed or implied by such forward-looking statements. Factors that may affect these results include, but are not limited to, matters relating to the proposed Merger; the impact of the COVID-19 pandemic on our business and the economy in general; the highly competitive nature of our industry; reliance on certain key customers; changes in consumer demand for marine, recreational vehicle and automotive products; expenditures on, and the effectiveness of our advertising and promotional efforts; adverse weather conditions; unanticipated litigation developments; exposure to market risks relating to changes in interest rates, foreign currency exchange rates and prices for raw materials that are petroleum or chemical based, availability in general of raw materials and other factors addressed in the sections entitled “Risk Factors” in Part I, Item 1A of our annual report on Form 10-K for the year ended December 31, 2021 and in Part II, Item 1A of this Quarterly Report on Form 10-Q.
Overview:
On June 21, 2022, the Company entered into an agreement with One Water Marine Inc. in which all of the Company’s common shares will be converted into the right to receive $13.08 per share. For additional information see our Form 8-K filed with the SEC on June 22, 2022, and Note 13, Merger Agreement, to the unaudited condensed consolidated financial statements included in the Quarterly Report on Form 10-Q.
We are engaged in the manufacture, marketing and distribution of a broad line of appearance, performance, and maintenance products for the marine, automotive, power sports, recreational vehicle and outdoor power equipment markets, under the Star brite® and other trademarks within the United States and Canada. In addition, we produce private label formulations of many of our products for various customers and provide custom blending and packaging services for these and other products. We also manufacture, market and distribute chlorine dioxide-based deodorizing, disinfectant and sanitizing products. We sell our products through national retailers and to national and regional distributors. In addition, we sell products to two companies affiliated with Peter G. Dornau, our Chairman, President and Chief Executive Officer; these companies distribute the products outside of the United States and Canada.
Critical accounting estimates:
See “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Critical Accounting Estimates” in Part II, Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2021 for information regarding our critical accounting estimates.
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Results of Operations:
Three Months Ended June 30, 2022 Compared to the Three Months Ended June 30, 2021
The following table provides a summary of our financial results for the three months ended June 30, 2022 and 2021:
| For The Three Months Ended June 30, |
||||||||||||||||||||
| Percent | Percentage of Net Sales | |||||||||||||||||||
| 2022 | 2021 | Change | 2022 | 2021 | ||||||||||||||||
| Net sales | $ | 15,208,834 | $15,688,985 | (3.1) | % | 100.0 | % | 100.0 | % | |||||||||||
| Cost of goods sold | 9,859,190 | 8,416,553 | 17.1 | % | 64.8 | % | 53.6 | % | ||||||||||||
| Gross profit | 5,349,644 | 7,272,432 | (26.4) | % | 35.2 | % | 46.4 | % | ||||||||||||
| Advertising and promotion | 1,633,975 | 1,265,583 | 29.1 | % | 10.7 | % | 8.1 | % | ||||||||||||
| Selling and administrative | 4,045,057 | 2,641,657 | 53.1 | % | 26.6 | % |
16.8 |
% | ||||||||||||
| Operating (loss) income | (329,388) | 3,365,192 | (109.8) | % | (2.2) | % | 21.4 | % | ||||||||||||
| Interest (expense), net | (79,128) | (40,823) | 93.8 | % | 0.5 | % | 0.3 | % | ||||||||||||
| Benefit (provision) for income taxes | 87,121 | (723,054) | (112.0) | % | (0.6 | )% | 4.6 | % | ||||||||||||
| Net (loss) income | $ | (321,395) | $ | 2,601,315 | (112.4) | % | (2.1) | % | 16.6 | % | ||||||||||
Net sales for the three months ended June 30, 2022 decreased by approximately $480,000, or 3.1%, as compared to the three months ended June 30, 2021. The Company had lower sales of core marine products partially offset by strong sales of winterizing products.
Cost of goods sold increased by approximately $1,443,000, or 17.1%, during the three months ended June 30, 2022, as compared to the three months ended June 30, 2021. Cost of sales increased at a higher rate than net sales primarily because of cost increases in both petroleum-based and other raw materials in addition to transportation cost increases from imports and domestic shipment freight cost to customers.
Gross profit decreased by approximately $1,923,000, or 26.4%, for the three months ended June 30, 2022, as compared to the three months ended June 30, 2021. Gross profit primarily decreased due to the Company’s cost of goods sold described above. As a percentage of net sales, gross profit was approximately 35.2% and 46.4% for the three months ended June 30, 2022 and 2021, respectively.
Advertising and promotion expenses increased by approximately $368,000, or 29.1%, during the three months ended June 30, 2022, as compared to the three months ended June 30, 2021. The increase in advertising and promotion expenses was principally a result of increased marketing programs, internet advertising and television advertising. As a percentage of net sales, advertising and promotion expenses increased to 10.7% for the three months ended June 30, 2022, from 8.1% for the three months ended June 30, 2021.
Selling and administrative expenses increased by approximately $1,403,000 or 53.1%, during the three months ended June 30, 2022, as compared to the three months ended June 30, 2021. The increase in selling and administrative expenses was primarily a result of two factors. The Company incurred legal and other professional costs associated with the pending merger with OneWater Marine, Inc. In addition, the Company incurred higher employee compensation expenses. As a percentage of net sales, selling and administrative expenses increased to 26.6% for the three months ended June 30, 2022, from 16.8% for the three months ended June 30, 2021.
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Interest (expense), net for the three months ended June 30, 2022 increased by approximately $38,000 or 93.8%, as compared to the three months ended June 30, 2021. The increase principally resulted from interest expense related to our term loan for the expansion at Kinpak.
Benefit from income taxes for the three months ended June 30, 2022 was approximately $87,000, or 21.3% of our income before income taxes. For the three months ended June 30, 2021 the provision for income taxes was approximately $723,000, or 21.8% of our income before income taxes.
Six Months Ended June 30, 2022 Compared to the Six Months Ended June 30, 2021
The following table provides a summary of our financial results for the six months ended June 30, 2022 and 2021:
| For The Six Months Ended June 30, | ||||||||||||||||||||
| Percent | Percentage of Net Sales | |||||||||||||||||||
| 2022 | 2021 | Change | 2022 | 2021 | ||||||||||||||||
| Net sales | $ | 27,946,163 | $ | 28,820,209 | (3.0) | % | 100.0 | % | 100.0 | % | ||||||||||
| Cost of goods sold | 17,860,537 | 16,167,056 | 10.5 | % | 63.9 | % | 56.1 | % | ||||||||||||
| Gross profit | 10,085,626 | 12,653,153 | (20.3) | % | 36.1 | % | 43.9 | % | ||||||||||||
| Advertising and promotion | 2,705,554 | 2,207,397 | 22.6 | % | 9.7 | % | 7.7 | % | ||||||||||||
| Selling and administrative | 6,045,087 | 4,614,469 | 31.0 | % | 21.6 | % | 16.0 | % | ||||||||||||
| Operating income | 1,334,985 | 5,831,287 | (77.1) | % | 4.8 | % | 20.2 | % | ||||||||||||
| Interest (expense), net | (110,810 | ) | (78,010 | ) | 42.0 | % | 0.4 | % | 0.3 | % | ||||||||||
| Provision for income taxes | (246,289 | ) | (1,247,693 | ) | (80.3) | % | 0.9 | % | 4.3 | % | ||||||||||
| Net income | $ | 977,886 | $ | 4,505,584 | (78.3) | % | 3.5 | % | 15.6 | % | ||||||||||
Net sales for the six months ended June 30, 2022 decreased by approximately $874,000, or 3.0%, as compared to the six months ended June 30, 2021. The decrease in net sales was principally a result of several customers adjusting their inventory levels of Star brite® branded marine products, private label marine and RV products.
Cost of goods sold increased by approximately $1,693,000, or 10.5%, during the six months ended June 30, 2022, as compared to the six months ended June 30, 2021. The increase in cost of goods sold was a result primarily of higher cost of petroleum based raw materials, imported material shipping costs of containers along with higher domestic transportation costs in addition to higher cost of manufacturing operating costs.
Gross profit decreased by approximately $2,568,000, or 20.3%, for the six months ended June 30, 2022 as compared to the six months ended June 30, 2021. Gross profit decreased due to lower sales volume and higher cost of sales as described above. As a percentage of net sales, gross profit was approximately 36.1% and 43.9% for the six months ended June 30, 2022 and 2021, respectively.
Advertising and promotion expenses increased by approximately $498,000, or 22.6%, during the six months ended June 30, 2022, as compared to the six months ended June 30, 2021. The increase in advertising and promotion expenses was principally a result of increased TV advertising in addition to several marketing programs targeting consumer brand awareness to our branded products. As a percentage of net sales, advertising and promotion expenses increased to 9.7% for the six months ended June 30, 2022, from 7.7% for the six months ended June 30, 2021.
Selling and administrative expenses increased by approximately $1,431,000, or 31.0%, during the six months ended June 30, 2022, as compared to the six months ended June 30, 2021. The increase in selling and administrative expenses was primarily a result of our pending merger with One Water Marine. In additional the Company incurred higher employee compensation expenses. As a percentage of net sales, selling and administrative expenses increased to 21.6% for the six months ended June 30, 2022, from 16.0% for the six months ended June 30, 2021.
Interest (expense), net for the six months ended June 30, 2022 increased by approximately $33,000 or 42.0%, as compared to the six months ended June 30, 2021. The increase principally resulted from interest expense related to our term loan for the expansion at Kinpak.
Provision for income taxes for the six months ended June 30, 2022 was approximately $246,289, or 20.1% of our income before taxes. For the six months ended June 30, 2021 the provision was approximately $1,248,000, or 21.7% of our income before taxes.
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Liquidity and capital resources:
Our cash balance was approximately $7,018,000 at June 30, 2022 and approximately $12,685,000 at December 31, 2021.
The following table summarizes our cash flows for the six months ended June 30, 2022 and 2021:
Six Months Ended June 30, | ||||||||
| 2022 | 2021 | |||||||
| Net cash (used in) provided by operating activities | $ | (5,228,933 | ) | $ | 483,201 | |||
| Net cash used in investing activities | (2,664,078 | ) | (2,922,273 | ) | ||||
| Net cash provided by (used in) financing activities | 2,226,465 | (859,478 | ) | |||||
| Effect of exchange rate fluctuations on cash | (338 | ) | 1,775 | |||||
| Net decrease in cash and restricted cash | $ | (5,666,884 | ) | $ | (3,296,775 | ) | ||
Net cash used in operating activities for the six months ended June 30, 2022 was approximately $5,229,000, as compared to net cash provided by operating activities of approximately $483,000 for the six months ended June 30, 2021. During the six months ended June 30, 2022, net income decreased by approximately $3,528,000, noncash adjustments to net income increased by approximately $193,000, and changes in working capital used approximately $2,378,000 more in cash, as compared to the six months ended June 30, 2021.
Net trade accounts receivable at June 30, 2022 aggregated approximately $11,580,000, an increase of approximately $2,036,000, or 21.3%, as compared to approximately $9,544,000 in net trade accounts receivable outstanding at December 31, 2021. The increase was principally a result of our net sales during the second quarter of 2022. Receivables due from affiliated companies aggregated approximately $1,494,000 at June 30, 2022, an increase of approximately $282,000, or 23.3%, from receivables due from affiliated companies of approximately $1,212,000 at December 31, 2021. The increase was primarily a result of our net sales to the affiliated companies in the second quarter of 2022.
Inventories, net were approximately $23,584,000 and $16,819,000 at June 30, 2022 and December 31, 2021, respectively, representing an increase of approximately $6,765,000, or 40.2%, during the six months ended June 30, 2022. We believe the higher levels of inventories were necessary in order to reduce potential supply chain problems and material price increases.
Net cash used in investing activities for the six months ended June 30, 2022 decreased by approximately $258,000, or 8.8%, as compared to the six months ended June 30, 2021. The decrease in cash used was principally due to the winding down of our expansion of our manufacturing, warehouse and distribution facilities at Kinpak.
Net cash provided by financing activities for the six months ended June 30, 2022 was approximately $2,226,000, as compared to net cash used in financing activities of approximately $859,000 for the six months ended June 30, 2021. The principal reason for the change is that during the six months ended June 30, 2022, we had approximately $3,460,000 in borrowings under our revolving line of credit, as compared to no borrowing during the first six months of 2021. During the six months ended June 30, 2022, the Company paid dividends to common shareholders aggregating approximately $761,000 and made payments on long term debt of approximately $467,000, as compared to dividends paid to common shareholders aggregating approximately $569,000 and payments on long term debt of approximately $291,000 during the six months ended June 30, 2021.
See Notes 6 and 7 to the condensed consolidated financial statements included in this report for information concerning our principal credit facilities, consisting of Kinpak’s obligations relating to a term loan, the payment of which we have guaranteed, an industrial development bond financing, the payment of which we have guaranteed, and a revolving line of credit. At June 30, 2022 and December 31, 2021, we had outstanding balances of approximately $4,756,000 and $4,888,000, respectively, under Kinpak’s obligation relating to the term loan, $3,106,000 and $3,334,000, respectively, under Kinpak’s obligations relating to the industrial development bond financing, and approximately $3,460,000 and $0, respectively, in borrowings under our revolving credit facility.
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The loan agreement pertaining to our revolving credit facility, as amended, has a stated term that expires on August 30, 2024, although as was the case with earlier revolving lines of credit provided to us in recent years, amounts outstanding are payable on demand. Nevertheless, the loan agreement pertaining to our revolving line of credit contains various covenants, including financial covenants that are described in Note 6 to the condensed consolidated financial statements included in this report. At June 30, 2022, we were in compliance with these financial covenants. The revolving credit facility is subject to several events of default, including a decline of the majority shareholder’s ownership below 50% of our outstanding shares.
Our guarantee of Kinpak’s obligations related to the industrial development bond financing are subject to various covenants, including financial covenants that are described in Note 7 to the condensed consolidated financial statements included in this report. At June 30, 2022, we were in compliance with these financial covenants.
In connection with our acquisition of assets of Snappy Marine, we issued a promissory note in the amount of $1,000,000, including interest (of the $1,000,000 amount of the promissory note, $930,528 was recorded as principal, and the remaining $69,472, representing an imputed interest rate of 2.87% per annum, is being recorded as interest expense over the term of the note). At June 30, 2022, we had an outstanding balance of $216,667 under the promissory note (including $213,082 recorded as principal and $3,585 to be recorded as interest expense over the remaining term of the note).
We also obtained financing through leases for office equipment, totaling approximately $68,000 and $79,000 at June 30, 2022 and December 31, 2021, respectively.
Some of our assets and liabilities are denominated in Canadian dollars and are subject to currency exchange rate fluctuations. We do not engage in currency hedging and address currency risk as a pricing issue. For the six months ended June 30, 2022, we recorded $8 in foreign currency translation adjustments (increasing shareholders’ equity by $8).
During the past few years, we have introduced a number of new products. At times, new product introductions have required us to increase our overall inventory and have resulted in lower inventory turnover rates. The effects of reduced inventory turnover have not been material to our overall operations. We believe that all required capital to maintain such increases will continue to be provided by operations and our current revolving line of credit or a renewal or replacement of the facility.
Many of the raw materials that we use in the manufacturing process are petroleum or chemical based and commodity chemicals that are subject to fluctuating prices. The nature of our business does not enable us to pass through the price increases to our national retailer customers and to our distributors as promptly as we experience increases in raw material costs. This may, at times, adversely affect our margins.
We believe that funds provided through operations and our revolving line of credit will be sufficient to satisfy our cash requirements over at least the next twelve months.
Item 3. Quantitative and Qualitative Disclosures about Market Risk
Not applicable
Item 4. Controls and Procedures
Evaluation of Disclosure Controls and Procedures:
The Company’s management, with the participation of the Company’s Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of the Company’s disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) at the end of the period covered by this report. Based on that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures as of the end of the period covered by this report are effective to provide reasonable assurance that the information required to be disclosed by the Company in reports filed under the Exchange Act are (i) recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms, and (ii) accumulated and communicated to the Company’s management, including the Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding the disclosure.
Change in Internal Controls over Financial Reporting:
No change in internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) occurred during the Company’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.
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PART II - OTHER INFORMATION
Item 1A. Risk Factors
The business, results of operations, financial condition, cash flow, and stock price of the Company can be affected by a number of factors, whether currently known or unknown, including but not limited to those described in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2021 under the heading “Risk Factors,” any one or more of which could, directly or indirectly, cause the Company’s actual financial condition, operating results and cash flow to vary materially from past, or from anticipated future, financial condition operating results and cash flow. In addition, the following supplements the risk factors set forth in our Annual Report on Form 10-K for the fiscal year ended December 31, 2021:
Failure to complete the Merger could negatively impact the market price of our common stock.
If the Merger is not completed for any reason, we will be subject to a number of material risks, including the following:
| ● | the market price of our common stock may decline; | |
| ● | costs relating to the Merger, such as legal, accounting and financial advisory fees, and, in specified circumstances, termination fees, must be paid by us, even if the Merger is not completed; and | |
| ● | the diversion of management’s attention from our day-to-day business, the potential disruption to our employees and our relationships with customers, suppliers and distributors and potential diversion from certain aspects of its previously announced product development program may make it difficult for us to regain our financial and market positions if the Merger is not completed. |
Further, if the Merger is terminated and our Board of Directors seeks another merger or business combination, shareholders cannot be certain that we will be able to find a party willing to pay an equivalent or better price than the price to be paid in the proposed merger.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
None.
Item 6. Exhibits
| Exhibit No. | Description | |
| 2.1+ | Agreement and Plan of Merger, dated as of June 21, 2022, by and among Ocean Bio-Chem, Inc., OneWater Marine Inc. and OBCMS, Inc. (incorporated by reference to Exhibit 2.1 to the Company’s Current Report on Form 8-K, filed with the Securities and Exchange Commission on June 22, 2022). | |
| 31.1 | Certification of Chief Executive Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act. | |
| 31.2 | Certification of Chief Financial Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act. | |
| 32.1 | Certification of Chief Executive Officer pursuant to Rule 13a-14(b) under the Exchange Act and 18 U.S.C. Section 1350. | |
| 32.2 | Certification of Chief Financial Officer pursuant to Rule 13a-14(b) under the Exchange Act and 18 U.S.C. Section 1350. | |
| 101.INS | XBRL Instance Document - The instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document. | |
| 101.SCH | Inline XBRL Taxonomy Extension Schema Document | |
| 101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase Document | |
| 101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase Document | |
| 101.LAB | Inline XBRL Taxonomy Extension Label Linkbase Document | |
| 101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase Document | |
| 104 | Cover Page Interactive Data File––the cover page interactive data file does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document. |
| + | Certain schedules and exhibits to this agreement have been omitted in accordance with Item 601(a)(5) of Regulation S-K. A copy of any omitted schedule and/or exhibit will be furnished to the Securities and Exchange Commission on request. |
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
| OCEAN BIO-CHEM, INC. | |
| Dated: August 4, 2022 | /s/ Peter G. Dornau |
| Peter G. Dornau | |
| Chairman of the Board, President and | |
| Chief Executive Officer | |
| Dated: August 4, 2022 | /s/ Jeffrey S. Barocas |
| Jeffrey S. Barocas | |
| Vice President and | |
| Chief Financial Officer |
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