Company: HROW
Filing Date: 2025-03-27
Form Type: 10-K
Source: 0001641172-25-000925
Chunk: 491

Company: HARROW, INC.
Filing Date: 2025-03-27
Form: 10-K
Item: Item 1B
Chunk 491
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 reported by the securities exchange on which the common stock was then listed, at the grant date
and have contractual terms of 10 years. Vesting terms for options granted to employees during the year ended December
31, 2024 generally included one of the following vesting schedules: 25% of the shares subject to the option vest and become exercisable
on the first anniversary of the grant date and the remaining 75% of the shares subject to the option vest and become exercisable quarterly
in equal installments thereafter over three years; and 100% of the shares subject to the option vest on a quarterly basis in equal installments
over three years. Certain option awards provide for accelerated vesting if there is a change in control (as defined in the Plans) and
in the event of certain modifications to the option award agreement.

    F-36

The fair value of each option award is estimated
on the date of grant using the Black-Scholes-Merton option pricing model. The Company calculates expected volatility based solely on
the historical volatilities of the common stock of the Company. The expected term of options granted was determined in accordance with
the “simplified approach,” as the Company has limited, relevant, historical data on employee exercises and post-vesting employment
termination behavior. The expected risk-free interest rate is based on the U.S. Treasury yield for a period consistent with the expected
term of the option in effect at the time of the grant. The financial statement effect of forfeitures is estimated at the time of grant
and revised, if necessary, if the actual effect differs from those estimates. For option grants to employees and directors, the Company
assigns a forfeiture factor of 10%. These factors could change in the future, which would affect the determination of stock-based compensation
expense in future periods. Utilizing these assumptions, the fair value is determined at the date of grant.

The table below illustrates the fair value per share
determined using the Black-Scholes-Merton option pricing model with the following assumptions used for valuing options granted to employees:

 SCHEDULE OF FAIR VALUE ASSUMPTIONS

    2024  
    2023 
  
    Weighted-average fair value of options granted 
    $11.46  
    $11.49 
  
    Expected terms (in years) 
     6.11  
     6.11 
  
    Expected volatility 
     68 – 73%