Company: HROW
Filing Date: 2025-05-08
Form Type: 10-Q
Source: 0001641172-25-009263
Chunk: 25

Company: HARROW, INC.
Filing Date: 2025-05-08
Form: 10-Q
Item: Item 1
Chunk 25
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 capital and general corporate purposes.
No other material changes to the Oaktree Loan were made pursuant to the Oaktree Amendment. Following entry into the Oaktree Amendment
and the funding of the Loan Increase upon closing of certain product acquisitions, the Company had drawn down a total principal loan amount
of $77,500,000 under the Oaktree Loan.

In October 2024, the Company entered into the
Second Amendment to Credit Agreement and Guaranty with Oaktree (“Second Amendment”). Upon satisfaction of certain conditions
to funding, the Company drew down the principal amount of the Tranche B commitment of $30,000,000 (the “$30,000,000 Draw”)
to partially fund a one-time milestone payment to Novartis. Under its asset purchase agreement with Novartis, the Company made a one-time
milestone payment to Novartis equal to $37,000,000 upon the commercial availability of TRIESENCE, which the Company paid in October 2024.
In connection with the Second Amendment and following the $30,000,000 Draw, the Company has drawn down a total principal loan amount of
$107,500,000 under the Oaktree Loan and no additional principal loan amount remains available to the Company under the Oaktree Loan.

The Oaktree Loan is secured
by nearly all of the assets, including intellectual property, of the Company and its material subsidiaries. The Oaktree Loan has a maturity
date of January 19, 2026 and carries an interest rate equal to the Secured Overnight Financing Rate plus 6.5% per annum (totaling 11.003%
at March 31, 2025). The Oaktree Loan also carries an exit fee equal to 3.5% of the aggregate principal amount owed, payable at maturity.
The total exit fee of $3,763,000 has been recorded as a debt discount. The original issue discount, fees and expenses (including the exit
fee) are being amortized over the term of the Oaktree Loan using the effective interest rate method. The Oaktree Loan requires quarterly
interest-only payments with all of the unpaid principal, interest and fees due on the maturity date, January 19, 2026.

The Oaktree Loan contains
customary guarantees and covenants, including financial covenants related to minimum liquidity and minimum net revenues. As of March 31,
2025, the Company was in compliance with the financial covenants.

Interest expense related
to the Oak