Company: HROW
Filing Date: 2025-04-25
Form Type: DEF 14A
Source: 0001641172-25-006102
Chunk: 30

Company: HARROW, INC.
Filing Date: 2025-04-25
Form: DEF 14A
Chunk 30
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 accordingly. Any intra-entity profits and losses are eliminated. During the year ended December 31, 2021, the Company reduced the carrying value of its investment in Melt to $0 as a result of the Company recording its share of equity losses in Melt since its deconsolidation in 2019. As of December 31, 2022, and at the time of entering into the Melt Loan Agreement (see below), the Company owned 100% of Melt’s indebtedness. Following the reduction of the carrying value of the Company’s common stock investment in Melt to $0, the Company began recording 100% of the equity method losses of Melt, based on its ownership of Melt’s total indebtedness. In addition, the Company treated interest paid in kind on the Melt Loan Agreement as an in-substance capital contribution and reduced its investment in Melt accordingly, rather than recording interest income.

On a quarterly basis, management assesses whether there are any indicators that the carrying value of the Company’s equity method investments may be other than temporarily impaired. Indicators include financial condition, operating performance, and near-term prospects of the investee. To the extent indicators suggest that a loss in value may have occurred, the Company will evaluate both quantitative and qualitative factors to determine if the loss in value is other than temporary. If a potential loss in value is determined to be other than temporary, the Company will recognize an impairment loss based on the estimated fair value of the equity method investments. During the year ended December 31, 2023, the Melt Loan Agreement was settled in exchange for Melt preferred stock (see below for loan settlement disclosure). The Company reduced the Melt Loan Agreement and subsequent preferred stock investment in Melt to $0 as a result of the Company recording its share of equity losses of Melt. The Company has no other investments in Melt and no other requirements to advance funds to Melt.

The following table summarizes the Company’s investments in Melt as of December 31, 2024 and 2023:

|                 |     | Cost  
 Basis |            |     | Share of Equity 
 Method Losses   |             |   |     | Net            
 Carrying value |   |
|:----------------|:----|:------|-----------:|:----|:----------------|:------------|:--|:----|:---------------|:--|
| Common stock    |     | $     |  5,810,000 |     | $