Company: HROW
Filing Date: 2025-03-27
Form Type: 10-K
Source: 0001641172-25-000925
Chunk: 1270

Company: HARROW, INC.
Filing Date: 2025-03-27
Form: 10-K
Item: Item 7A
Chunk 1270
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 of directors consists of five members, including
Mr. Baum. Mr. Baum is the only representative of the Company on Melt’s board of directors.

Melt Note Receivable – Settled and Terminated
in 2023

On September 1, 2021, the Company entered into a
loan and security agreement in the principal amount of $13,500,000 (the “Melt Loan Agreement”), as lender, with Melt, as
borrower. Amounts borrowed under the Melt Loan Agreement bore interest at 12.50% per annum, which interest could have been paid in-kind
at the option of Melt until the maturity date. The Melt Loan Agreement permitted Melt to pay interest only on the principal amount loaned
thereunder through the term and all amounts owed were previously due and payable on September 1, 2022. In April 2022, the Company entered
into a First Amendment and in September 2022, a Second Amendment (together, the “Amendments”) to the Melt Loan Agreement.
The Amendments (i) extended the maturity date of the Melt Loan Agreement to September 1, 2023, which could have been extended further
to September 1, 2026 upon Melt completing a qualifying financing of a minimum amount of $10,000,000 from third-party investors, (ii)
added conditions related to minimum cash amounts following a qualifying financing, and (iii) clarified the definition of material adverse
effects. Melt could have elected to prepay all, but not less than all, of the amounts owed prior to the maturity date at any time without
penalty. The net funds received by Melt excluded $908,000 owed to the Company for reimbursable expenses and amounts due under the Melt
MSA prior to the effective date of the note receivable.

In connection with the Melt Loan Agreement, the Company
and Melt entered into a Right of First Refusal Agreement providing the Company with the right, but not the obligation, to match any offer
received by Melt associated with the commercial rights to any of Melt’s drug candidates for a period of five years following the
effective date of the Melt Loan Agreement.

On December 28, 2023, the Company terminated the
Melt Loan Agreement. As of the date of termination, approximately $18,395,000 remained outstanding under the Melt Loan Agreement. Pursuant
to the terms of