Company: HROW
Filing Date: 2025-03-27
Form Type: 10-K
Source: 0001641172-25-000925
Chunk: 855

Company: HARROW, INC.
Filing Date: 2025-03-27
Form: 10-K
Item: Item 4
Chunk 855
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under the respective agreements. The Company also indemnifies its lessors in connection with its facility leases for certain claims arising
from the use of the facilities. These indemnities do not provide for any limitation of the maximum potential future payments the Company
could be obligated to make. Historically, the Company has not incurred any payments for these obligations and, therefore, no liabilities
have been recorded for these indemnities in the accompanying consolidated balance sheets.

Asset Purchase, License and Related Agreements

FDA Approved Product Acquisitions

In recent years, the Company has acquired commercial
and product rights to various FDA approved ophthalmic medications and products through asset purchase, licenses, supply and/or other
related agreements. In general, in exchange for product and commercial rights these agreements provide the counterparties with certain
upfront and contingent milestone payments typically related to certain annual sales amounts and manufacturing events, and in certain
cases, per unit transfer prices and royalties on sales of some of the products. During the years ended December 31, 2024 and 2023, $4,126,000 and
$647,000, respectively, were incurred under these agreements as royalty expenses. During the year ended December 31, 2024, $37,000,000
was incurred under these agreements related to upfront and milestone payments under these agreements. During the year ended December
31, 2023, the Company amended the Sintetica Agreement to allow for early payment of previously accrued amounts for commercial related
milestones associated with sales of IHEEZO in exchange for a $550,000 reduction in the milestone amounts due, and as a result of
this amendment, the Company reduced the intangible asset value associated with IHEEZO by $550,000 and paid the remaining commercial
milestone amount of $4,450,000. As of December 31, 2024, the remaining contingent consideration payable pursuant to these agreements
were not considered probable and reasonably estimable and therefore, no amount was accrued related to these contingent obligations during
the year ended December 31, 2024. At the time contingent consideration payable becomes probable and reasonably estimable the additional
consideration, if any, paid will be allocated to the assets based on their initial estimated fair values as a percent of the total purchase
price.

    F-43

 Formulation Acquisitions

 The Company has acquired and sourced intellectual
property rights related to certain proprietary innovations from certain inventors, innovator