Company: BFRG
Filing Date: 2025-11-14
Form Type: 10-Q
Source: 0001493152-25-023496
Chunk: 64

Company: BullFrog AI Holdings, Inc.
Filing Date: 2025-11-14
Form: 10-Q
Item: Item 8
Chunk 64
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. In consideration for entering into the new license, the Company
issued 39,879 shares of common stock to JHU-APL. Under the terms of the 2022 License Agreement, JHU-APL will be entitled to eight percent
(8%) of net sales for the services provided by the Company to other parties and three percent (3%) for internally developed drug projects
in which the JHU-APL license is utilized. The new license also contains tiered sub licensing fees that start at 50% and decline to 25%
based on revenues. In addition, under the 2022 License Agreement, the minimum annual royalty payments are $30,000 for 2022, $80,000 for
2023, and $300,000 per year for 2024 and beyond, all of which are creditable by royalties. If cumulative annual royalty payments do not
reach these levels, the amount due to JHU-APL to reach the annual minimum is due by January 1st of the following year. Failure
to make annual royalty payments is considered a material breach under the agreement and, upon notice from JHU-APL of a material breach,
the Company will have 60 days to cure the material breach. The financial terms of the new license agreement replace the original terms
within the 2018 License Agreement and are not duplicative.

In
May 2023, the Company and JHU-APL entered into Amendment Number 1 of the 2022 License Agreement whereby the Company gained access to
certain improvements including additional patents and know-how in exchange for a series of payments totaling $275,000. The first of these
payments for $75,000 was paid in July 2023, the second of these payments for $75,000 was paid in June 2025, and the remaining payments
of $75,000 and $50,000 are due in 2026 and 2027, respectively. The amendment also reduced the 2023 minimum annual royalty payment to
$60,000; all other financial terms remain the same.

As
of September 30, 2025, all minimum annual royalty payments through 2024 have been paid, the Company has accrued $225,000 of the $300,000
minimum annual royalty due in December 2025, and the Company has accrued $25,000 of the $75,000 annual license fee due in June 2026.
The Company assessed whether the license