DEF 14A of Harrow, Inc., Apr 26, 2024

DEF 14A of Harrow, Inc.

Filed Apr 26, 2024 · FY20230001493152-24-016423

Open on EDGAR

  1. ELECTION OF DIRECTORS

    ELECTION OF DIRECTORS Our Board currently consists of six directors. Upon the recommendation of the Company’s Nomination and Corporate Governance Committee, our Board has selected five director nominees for election at the Annual Meeting. Each of the nominees is currently a director of the Company and was elected or re-elected by our stockholders at our 2023 Annual Meeting of Stockholders (the “2023 Annual Meeting”), with the exception of Adrienne L. Graves and Lauren P. Silvernail, both of whom were appointed as directors in January 2024. Teresa F. Sparks currently serves as a director of the Company and is not being nominated for re-election, causing her term as a member of the Board to expire at the Annual Meeting. Ms. Sparks is currently Chair of the Audit Committee of the Board and will continue to serve as Chair of the Audit Committee until such time as her term expires. The Audit Committee has designated Ms. Silvernail to become Chair of the Audit Committee following the expiration of Ms. Sparks’ term, contingent upon Ms. Silvernail’s re-election to the Board. As a result of Ms. Sparks not being nominated for re-election, the Board reduced the number of directors serving on the Board from six to five effective following the Annual Meeting. There are no familial relationships among any of our directors or our executive officers. No arrangement or understanding exists between any nominee and any other person or persons pursuant to which any nominee was or is to be selected as a director or director nominee of the Company.

  2. Nominees

    Nominees The Board has selected the five persons listed below as nominees for election to the Board at the Annual Meeting. Each of these nominees has indicated that he or she is willing and able to serve as a director. If any of the nominees declines to serve or becomes unavailable for any reason, or if a vacancy occurs before the election (although we know of no reason to anticipate that this will occur), your proxy may be voted for such substitute nominees as the Board may designate. The following table sets forth information regarding the nominees for directors and such persons, if elected at the Annual Meeting, will serve as directors until the earlier of the 2025 Annual Meeting of Stockholders (the “2025 Annual Meeting”) or until their successors are duly elected and qualified.

  3. Nominees

    | Name | Age | Position & Committees | | Mark L. Baum | 51 | Chairman of the Board, Chief Executive Officer | | Adrienne L. Graves | 70 | Independent Director, Audit Committee, Compensation Committee*, Nomination and Corporate Governance Committee | | Martin A. Makary | 53 | Independent Director, Audit Committee, Compensation Committee, Nomination and Corporate Governance Committee* | | Lauren P. Silvernail | 65 | Independent Director, Audit Committee*, Compensation Committee, Nomination and Corporate Governance Committee | | Perry J. Sternberg | 55 | Lead Independent Director, Audit Committee, Compensation Committee, Nomination and Corporate Governance Committee |

  4. Nominees

    * Denotes committee chair. In the case of the Audit Committee, Ms. Silvernail will serve as Chair following, and conditioned upon her re-election at, the Annual Meeting.

  5. Nominees

    | Harrow, Inc. 2024 Proxy Statement | 4 |

  6. Nominees

    Mark L. Baum is a founder, Chairman of the Board of Directors and Chief Executive Officer of the Company. In 2011, Mr. Baum led the restructuring and reorganization of the Company and since that time has directed the key operational and strategic activities of the Company. Mr. Baum was appointed as a director of the Company in December 2011, served as the Chairman of the Board of Directors from December 2011 to April 2012, was appointed Chief Executive Officer in April 2012, and was again appointed and has served as the Chairman of the Board since August 2021. Prior to Mr. Baum’s involvement with the Company, from 2001 to 2011, he was the founder and managing director of TBLF, LLC, a consulting firm and fund manager, where he managed a series of three funds and acted as a principal investor in financing publicly-traded companies or bridge-to-public equity transactions. Before his fund management experience, Mr. Baum founded and served as the president of YesRx, an online pharmacy business, and practiced as a securities lawyer focused on public company reporting requirements and finance-related matters. Mr. Baum is also a founder and board member of Melt Pharmaceuticals, Inc. and is a founder and former board member of both Surface Ophthalmics, Inc., and Eton Pharmaceuticals, Inc. From November 2012 until December 2017, Mr. Baum served on the board of directors of Ideal Power, Inc., an energy-focused technology company, where he also served as the chair of its audit committee. Mr. Baum is a graduate, cum laude, of The University of Texas at Arlington and a graduate of California Western School of Law. Mr. Baum brings years of public company executive and board experience, including knowledge of securities laws, reporting requirements, and public company finance-related issues. Adrienne L. Graves has served as a director of the Company since January 2024. She previously served as President and Chief Executive Officer of Santen Inc., the United States subsidiary of a publicly-traded Japanese pharmaceutical company, from 2002 to 2010 and as Senior Vice President of Worldwide Clinical Development (U.S., Europe, and Japan) from 1995 to 2002. Ms. Graves has served as a member of the boards of directors of Ocular Therapeutix, Inc., a publicly-traded biopharmaceutical company, since July 2023; and Surface Ophthalmics, Inc., a development stage ophthalmology pharmaceutical company and former subsidiary of the Company, since 2018. Previously, Ms. Graves served as a member of the board of directors of Nicox S.A., a French ophthalmology company, from 2014 to 2024; IVERIC bio, Inc., a biopharmaceutical company, from 2018 to 2021, and as the chairman of IVERIC’s board from 2021 to 2023; Greenbrook TMS Inc., a Canadian neurology and medical device company, from 2018 to 2023; Oxurion NV, a Belgian biopharmaceutical company, from 2018 until 2023; Akorn Inc., a pharmaceutical company, from 2012 to 2018; and TearLab Corporation (now Trukera Medical), a biopharmaceutical company, from 2005 to 2018. Ms. Graves received a Bachelor of Arts degree in Psychology from Brown University and a Ph.D. in Psychobiology from the University of Michigan and completed a Postdoctoral Fellowship in Visual Neuroscience at the University of Paris. Ms. Graves brings to the Board remarkable leadership skills and pharmaceutical development and operational expertise across the pharmaceutical industry, including having contributed to bringing multiple ophthalmic products through development to approval and commercialization as well as having been responsible for numerous successful acquisitions and partnerships. Martin A. Makary has served as a member of our Board of Directors since March 2022. Mr. Makary is a healthcare expert and is Chief of Islet Transplant Surgery at The Johns Hopkins Hospital, where he has been employed since 2002. Mr. Makary is a frequent public policy expert in the media and a leading voice for physicians, writing for The Wall Street Journal. He is the author of two New York Times bestselling books on healthcare and has published over 250 scientific peer-reviewed articles, including articles on organizational culture, surgical innovation, vulnerable populations, and the re-design of healthcare delivery. Mr. Makary has served in leadership at the World Health Organization and has been elected to the National Academy of Medicine. Mr. Makary has been a visiting professor at over 25 medical schools and is the recipient of the Nobility in Science Award from the National Pancreas Foundation. Mr. Makary speaks frequently on the future of healthcare and what it means for everyday Americans, business leaders, and healthcare professionals. His current research focuses on the appropriateness of medical care and the impact of the healthcare cost crisis on low-income populations. He has a Bachelor of Science degree from Bucknell University, an M.D. degree from Thomas Jefferson University, and a Master of Public Health degree, with a concentration in Health Policy, from Harvard University. Mr. Makary brings to the Board extensive experience as a surgeon, corporate advisor, and healthcare policy thought leader.

  7. Nominees

    | Harrow, Inc. 2024 Proxy Statement | 5 |

  8. Nominees

    Lauren P. Silvernail has served as a director of the Company since January 2024. From 2018 to 2022, she was Chief Financial Officer and Executive Vice President, Corporate Development of Evolus, Inc., an aesthetic medicines company. Prior to that time, Ms. Silvernail served as the Chief Financial Officer and Chief Business Officer of Revance Therapeutics, Inc., a development stage aesthetic medicine company, from 2015 to 2018 and as Chief Financial Officer and Executive Vice President, Corporate Development from 2013 to 2015. From 2003 to 2012, Ms. Silvernail was Chief Financial Officer and Vice President of Corporate Development at ISTA Pharmaceuticals, Inc., a commercial pharmaceutical company that was acquired by Bausch & Lomb. From 1995 to 2003, Ms. Silvernail served in various operating and corporate development positions at Allergan, a pharmaceutical company, including Vice President, Business Development. Prior to joining Allergan, Ms. Silvernail worked at Glenwood Ventures, an investment firm, as a General Partner. She currently serves on the board of directors and as chair of the audit committee at Harpoon Therapeutics, Inc., an immuno-oncology company that was recently acquired by Merck & Co., Inc. In addition, she served on the board of directors, as a member of the audit and compensation committees and as the chair of the corporate governance committee of Nicox S.A. from 2017 to 2024. Ms. Silvernail holds a Bachelor of Arts degree in Biophysics from the University of California, Berkeley and a Master of Business Administration degree from the Anderson Graduate School of Management at the University of California, Los Angeles. Ms. Silvernail brings to the Board a successful track record in operational, financial, and business development within the life sciences industry. Perry J. Sternberg has served as a member of our Board of Directors since March 2022. Mr. Sternberg has served as the President and Chief Executive Officer of Corium, Inc., a commercial stage biopharmaceutical company leading the development and commercialization of novel central nervous system (“CNS”) therapies, since 2019. Prior to joining Corium, he served from 2013 to 2019 as Executive Vice President and Head of U.S. Commercial for Shire Plc’s ophthalmology business unit as well as six other Shire business units, which, during his tenure, in the aggregate, generated more than $8 billion in annual revenues. Mr. Sternberg also served as Chief Commercial Officer and Global Head of Shire’s CNS Business. Mr. Sternberg previously served as Vice President and General Manager, U.S. and Canada Pharmaceuticals at Bausch & Lomb, as well as various leadership roles at Novartis Ophthalmics, Novartis Pharmaceuticals and Merck & Co., Inc. In his 25 years of experience in biotechnology and pharmaceuticals, Mr. Sternberg has had direct responsibility for the launch and commercialization of more than 20 products across a wide range of therapeutic areas in diverse markets, including ophthalmic pharmaceuticals. Mr. Sternberg is also a member of the board of directors of privately held Surface Ophthalmics, Inc. He received a Bachelor of Science degree in Animal Bioscience from Penn State University in 1990. Mr. Sternberg brings to the Board 25 years of experience in biotechnology and pharmaceuticals, including the development of a strategic marketing vision, implementation of tactical sales plans that drive revenue growth, and effective leadership of teams to achieve as well as exceed growth targets. Each director is elected by a plurality of the votes cast on the election of directors at a meeting at which a quorum is present. As a result, the nominees who receive the highest number of votes, up to the number of directors to be elected at the Annual Meeting, will be elected. Because directors are elected by a plurality of the votes cast, abstentions and broker non-votes will not be counted in determining which nominees receive the largest number of votes cast and, therefore, will have no effect on the outcome of the vote on this proposal. The persons named in the proxy card will vote the proxies they receive FOR the election of the nominees named above unless a particular proxy card withholds authorization to do so or provides contrary instructions.

  9. DIRECTOR COMPENSATION

    DIRECTOR COMPENSATION

  10. Director Compensation Program for Year Ended December 31, 2023

    Director Compensation Program for Year Ended December 31, 2023 A summary of the non-employee director compensation arrangements for 2023 is set forth below. Cash Compensation

  11. Director Compensation Program for Year Ended December 31, 2023

    | | Retainer and Meeting Fees | | Annual Board Retainer Fee | $50,000 | | Annual Chair Retainer Fees*: | | | Non-Employee Chairman of the Board or Lead Independent Director | $30,000 | | Audit Committee Chair | $20,000 | | Compensation Committee Chair | $15,000 | | Nomination and Corporate Governance Committee Chair | $10,000 | | Annual Committee Member Retainer Fees*: | | | Audit Committee | $10,000 | | Compensation Committee | $7,500 | | Nomination and Corporate Governance Committee | $5,000 |

  12. Director Compensation Program for Year Ended December 31, 2023

    | * These fees are in addition to the Annual Board Retainer Fee, as applicable. |

  13. Director Compensation Program for Year Ended December 31, 2023

    Non-employee directors are also reimbursed for their reasonable out-of-pocket expenses incurred in connection with attending Board and committee meetings. Equity Compensation Non-employee directors are eligible to receive an annual award of restricted stock units (“RSUs”) valued at $150,000, as well as an initial award of RSUs at the time of their appointment to the Board. These RSUs will vest in equal quarterly installments over a one-year period subject to the director’s continued service, but the issuance and delivery of the shares subject to the RSUs are deferred until the director resigns or otherwise terminates his or her service as a director.

  14. Director Compensation Table

    Director Compensation Table The following table shows the compensation earned by, awarded or paid in 2023 to the individuals who served as our non-employee directors during such period and the number of shares underlying RSUs held by each non-employee director at year-end. Mr. Van Horn resigned from the Board effective November 13, 2023. Mr. Lindstrom was a Board member until our 2023 Annual Meeting. Ms. Graves and Ms. Silvernail were added to the Board in January 2024 and, therefore, are not included in the table below. Mr. Baum did not receive any additional compensation for his services as a director and his compensation received as an executive officer is disclosed in the Summary Compensation Table in this Proxy Statement.

  15. Director Compensation Table

    | Name | Fees Earned or Paid in Cash ($) | Stock Awards ($) (1)(2) | Other ($) | Total ($) | Aggregate Shares Underlying RSUs Held by Directors (3) | | Teresa F. Sparks | $77,500 | $150,000 | $- | $227,500 | 57,517 | | Richard L. Lindstrom | $20,000 | $199,995(4) | $319,357(4) | $539,352 | 133,066 | | R. Lawrence Van Horn (5) | $78,750 | $150,000 | $- | $228,750 | 43,011 | | Perry J. Sternberg | $52,500 | $150,000 | $- | $202,500 | 20,867 | | Martin A. Makary | $55,000 | $150,000 | $- | $205,000 | 20,867 |

  16. Director Compensation Table

    | (1) Reflects the dollar amount of the grant date fair value of awards granted in 2023, measured in accordance with ASC 718, Compensation - Stock Compensation (“ASC 718”) and without adjustment for estimated forfeitures. For a discussion of the assumptions used to calculate the value of equity awards, refer to Note 15 to our consolidated financial statements for the fiscal year ended December 31, 2023, included in the Annual Report. | | (2) Each non-employee director received an award of 7,744 RSUs during the year ended December 31, 2023. | | (3) Includes shares that have vested, but the issuance and delivery of which is deferred until the director resigns or otherwise terminates service. | | (4) Amounts paid to Mr. Lindstrom as set forth in the table are for the entire year ended December 31, 2023. Amounts include royalties paid to Mr. Lindstrom as part of the Klarity License Agreement and Lindstrom APA (defined under the heading “Corporate Governance – Transactions with Related Persons” above) and consulting fees associated with consulting services paid in the form of RSUs and cash paid for serving as a part of the Company’s medical advisory board. | | (5) Compensation through November 13, 2023, the effective date of Mr. Van Horn’s resignation from the Board. |

  17. Director Compensation Table

    | Harrow, Inc. 2024 Proxy Statement | 17 |

  18. Compensation Philosophy and Objectives

    The Compensation Committee considers, with respect to each of the Company’s executive officers, the total compensation that may be awarded, including base salary, annual incentive compensation, long-term incentive compensation and other benefits, such as discretionary cash bonuses, perquisites and other personal benefits available to each executive officer or that may be received by such executive officer under certain circumstances, including compensation payable upon termination of such executive officer under an employment agreement or severance agreement (if applicable). The Compensation Committee recognizes that its overall goal is to award compensation that is reasonable when all elements of potential compensation are considered. The Compensation Committee believes that cash compensation in the form of base salary and an annual incentive bonus provides our executives with short-term rewards for success in operations, and that long-term compensation through the award of stock options, restricted stock units and other equity awards aligns the objectives of management with those of our stockholders with respect to long-term performance and success. The Compensation Committee also has historically focused on the Company’s financial and working capital condition when making compensation decisions and approving performance objectives. Because the Company has historically sought to preserve cash, overall compensation traditionally has been weighted more heavily toward equity-based compensation, as well as cash payments that are earned only upon the Company’s achievement of specified performance goals. The Compensation Committee will continue to periodically reassess the appropriate weighting of cash and equity compensation in light of the Company’s expenditures in connection with commercial operations and its working capital needs.

  19. Compensation Program Overview

    | ● | Base Salary | | ● | Annual Bonus | | ● | Equity Compensation | | ● | Employee Benefit Program | | ● | Change of Control Arrangements |

  20. Compensation Program Overview

    Salaries for executive officers are determined on an individual basis at the time of hire. Adjustments to base salary are considered annually in light of the factors above. The Chief Executive Officer assists the Compensation Committee in its annual review of the base salaries of other named executive officers and members of senior management based on the foregoing criteria. Annual Bonus The Company provides executive officers with annual performance-based cash bonus opportunities, which are specifically designed to reward executives for overall corporate performance as well as individual performance in a given year. Corporate and individual goals are established at the beginning of each year by the Compensation Committee with input from senior management. The target annual incentive bonus amounts relative to base salary vary depending on each executive’s accountability, scope of responsibilities and potential impact on the Company’s performance. Accordingly, the higher the level of control and accountability that is exercisable by an executive officer over our overall performance, the greater the percentage of the executive officer’s target total cash compensation that is dependent on the annual performance-based cash bonus award. We believe these target bonus levels for our executive officers are appropriate and consistent with our pay-for-performance compensation philosophy. At the end of each fiscal year, individual and corporate performance are measured versus plan and a percentage of target is established, which then determines the size of the total bonus pool from which annual bonus incentives are to be paid to executive officers. All cash bonuses are awarded retrospectively. For 2023 and 2022, the annual incentive bonus for our executive officers was based 100% on overall corporate performance, including metrics associated with revenue, adjusted EBITDA, revenue from certain products and stock price performance. Target annual incentive bonus levels for 2023 and 2022 were 60% of annual base salary for our Chief Executive Officer and 50% for all other named executive officers. At the end of each year, the Compensation Committee, with input from senior management, evaluates individual and corporate performance compared against the goals established under the 2017 Plan (as defined under the “Outstanding Equity Awards at Fiscal Year-End” table below), which determines the size of the total bonus pool from which cash bonuses are to be paid to executive officers. Based on this evaluation, the Compensation Committee determined to award, for service performed in 2023 that exceeded target levels, our Chief Executive Officer a cash incentive bonus equal to 60% of his annual base salary, and our Chief Financial Officer and Chief Commercial Officer cash incentive bonuses equal to 50% of their annual base salaries.

  21. Summary Compensation Table

    Summary Compensation Table The following table sets forth total compensation paid to our named executive officers, who are comprised of our principal executive officer and our next two highest compensated executive officers.

  22. Summary Compensation Table

    | Name and Principal Position | Year | Salary | Stock Awards (1) | Non-Equity Incentive Plan Compensation (2) | All Other Compensation (3) | Total | | Mark L. Baum | 2023 | $680,086 | $14,150,821(4) | $421,800 | $3,756 | $15,256,463 | | Chief Executive Officer | 2022 | $608,649 | $- | $500,346 | $86,146 | $1,195,141 | | Andrew R. Boll | 2023 | $459,900 | $6,432,192(4) | $236,500 | $1,817 | $7,130,409 | | Chief Financial Officer and | 2022 | $416,427 | $- | $285,225 | $62,734 | $764,386 | | Corporate Secretary | | | | | | | | John P. Saharek | 2023 | $431,463 | $5,145,753(4) | $225,000 | $12,938 | $5,815,154 | | Chief Commercial Officer; | 2022 | $378,955 | $- | $261,287 | $16,645 | $656,887 | | Chief Executive Officer and President, ImprimisRx | | | | | | |

  23. Summary Compensation Table

    | (1) Reflects the grant date fair value of awards granted during the respective fiscal years, measured in accordance with ASC 718 and without adjustment for estimated forfeitures. For a discussion of the assumptions used to calculate the value of equity awards, refer to Note 15 to our consolidated financial statements for the year ended December 31, 2023, included in the Annual Report. For information about the material terms of each equity award, see the tables under the subheading entitled “Outstanding Equity Awards at Fiscal Year-End” below. | | (2) Amounts represent payouts under the Company’s annual cash bonus incentive plan based on the Company’s performance measured against the corporate objectives established for the named executive officer and the named executive officer’s individual performance measured against his individual goals. Such amounts are determined and paid after the end of each year, but reflect individual and Company performance for the respective years reflected above. | | (3) Amounts represent matching contributions made by us for the benefit of the named executive officer under our 401(k) retirement savings plan, group life insurance benefit in excess of the standard threshold granted to all other employees and the payout of unused and accrued paid-time-off (“PTO”) balances of Mr. Baum and Mr. Boll during 2022 as a result of a change in PTO policy to provide unlimited PTO for those individuals. | | (4) Reflects the fair market value, as of the date of issuance, of multi-year equity awards to Mr. Baum, Mr. Boll and Mr. Saharek, accordingly, which are market-based vesting performance stock unit (“PSU”) awards that vest at various share price targets – as described further under the subheading “Outstanding Equity Awards at Fiscal Year-End - 2023 PSUs- Multi-Year Awards.” |

  24. Summary Compensation Table

    | Harrow, Inc. 2024 Proxy Statement | 22 |

  25. Outstanding Equity Awards at Fiscal Year-End

    Outstanding Equity Awards at Fiscal Year-End The following table sets forth certain information regarding outstanding equity awards of the Company held by our named executive officers as of December 31, 2023.

  26. Outstanding Equity Awards at Fiscal Year-End

    | | | Option Awards (1) | | | | Stock Awards (1) | | | | | Number of Securities Underlying Unexercised Options | | | | Equity Incentive Plan Awards: Number of Shares | Equity Incentive Plan Awards: Market Value of Unearned Shares | | Name | Grant Date | Exercisable | Exercisable | Option Exercise Price | Option Expiration Date | or Units of Stock that Have Not Vested | or Units of Stock that Have Not Vested (2) | | Mark L. Baum | 2/10/2014 | 15,400 | - | $7.71 | 2/10/2024 | - | - | | | 7/30/2015 | 600,000 | - | $7.87 | 7/31/2025 | - | - | | | 4/1/2016 | 180,000 | - | $3.95 | 4/1/2026 | - | - | | | 2/1/2017 | 160,000 | - | $2.23 | 2/1/2027 | - | - | | | 1/1/2018 | 150,000 | - | $1.73 | 1/2/2028 | - | - | | | 2/19/2019 | 150,000 | - | $6.30 | 2/19/2029 | - | - | | | 1/2/2020 | 217,500 | - | $7.30 | 1/2/2030 | - | - | | | 2/19/2021 | - | - | - | - | 150,000 (4) | $1,680,000 | | | 4/3/2023 | - | - | - | - | 762,300 (3) | $8,537,760 | | Andrew R. Boll | 2/10/2014 | 7,400 | - | $7.71 | 2/10/2024 | - | - | | | 4/1/2016 | 60,000 | - | $3.95 | 4/1/2026 | - | - | | | 2/1/2017 | 55,000 | - | $2.23 | 2/1/2027 | - | - | | | 1/2/2018 | 50,000 | - | $1.73 | 1/2/2028 | - | - | | | 2/19/2019 | 50,000 | - | $6.30 | 2/19/2029 | - | - | | | 1/2/2020 | 57,000 | - | $7.30 | 1/2/2030 | - | - | | | 2/19/2021 | - | - | - | - | 45,000 (4) | $504,000 | | | 4/3/2023 | - | - | - | - | 346,500 (3) | $3,880,800 | | John P. Saharek | 3/3/2014 | 5,000 | - | $8.75 | 3/3/2024 | - | - | | | 2/1/2015 | 90,000 | - | $7.37 | 2/1/2025 | - | - | | | 4/1/2016 | 60,000 | - | $3.95 | 4/1/2026 | - | - | | | 2/1/2017 | 55,000 | - | $2.23 | 2/1/2027 | - | - | | | 1/2/2018 | 50,000 | - | $1.73 | 1/2/2028 | - | - | | | 2/19/2019 | 50,000 | - | $6.30 | 2/19/2029 | - | - | | | 8/3/2020 | 20,308 | 4,692 (5) | $5.72 | 8/3/2030 | - | - | | | 2/19/2021 | - | - | - | - | 30,000 (4) | $336,000 | | | 4/3/2023 | - | - | - | - | 277,200 (3) | $3,104,640 |

  27. Outstanding Equity Awards at Fiscal Year-End

    | (1) The amounts shown relate to stock options and RSUs granted under both the 2007 Incentive Stock and Awards Plan (the “2007 Plan”) and the 2017 Incentive Stock and Awards Plan (the “2017 Plan”). | | (2) Calculated by multiplying the number of unvested shares by $11.20, the closing price per share of our common stock on The Nasdaq Global Market on December 29, 2023. | | (3) The PSUs vest upon achieving and maintaining for a minimum term certain stock price targets ranging from $25.00 to $50.00 during a five-year period and require a minimum of a two-year service period. See subheading “2023 PSUs- Multi-Year Awards” for more information. | | (4) The RSUs vest in full on the third anniversary of the grant date. | | (5) 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. |

  28. Pay Versus Performance

    Pay Versus Performance The following tables and related disclosures provide information about (i) the “total compensation” of our principal executive officer (the “PEO”) and our other named executive officers (the “Other NEOs”) as presented in the “Summary Compensation Table” (the “SCT Amounts”), (ii) the “compensation actually paid” to our PEO and our Other NEOs, as calculated pursuant to the SEC’s pay-versus-performance rules (the “CAP Amounts”), (iii) certain financial performance measures, and (iv) the relationship of the CAP Amounts to those financial performance measures. This disclosure has been prepared in accordance with Item 402(v) of Regulation S-K under the Exchange Act and does not necessarily reflect value actually realized by the executives or how our Compensation Committee evaluates compensation decisions in light of company or individual performance. For discussion of how our Compensation Committee seeks to align pay with performance when making compensation decisions, please review “Executive Compensation.”

  29. Pay Versus Performance

    | | | | | | Value of Initial Fixed $100 Investment Based on: | | | | Year (a) | Summary Compensation Table Total for PEO (1) (b) | Compensation Actually Paid to PEO (1)(2) (c) | Average Summary Compensation Table Total for Other NEOs (1) (d) | Average Compensation Actually Paid to Other NEOs (1)(2) (e) | Total Shareholder Return (3) (f) | Peer Group Total Shareholder Return (4) (g) | Net Loss (5) (h) | | 2023 | $15,256,463 | $3,113,362 | $6,472,781 | $1,934,673 | $163 | $92 | $24,411,000 | | 2022 | $1,195,141 | $9,511,499 | $710,637 | $3,053,124 | $215 | $89 | $14,086,000 | | 2021 | $7,321,467 | $8,694,375 | $3,014,506 | $3,538,147 | $126 | $99 | $18,007,000 |

  30. Pay Versus Performance

    | (1) Mark Baum was our PEO for each year presented. Andrew Boll and John Saharek are the individuals comprising the Other NEOs for each year presented. | | (2) The following table sets forth adjustments made during each year presented to arrive at the CAP Amounts for our PEO and Other NEOs during each year: |

  31. Pay Versus Performance

    | | 2023 | | 2022 | | 2021 | | | Adjustments | PEO | Other NEOs | PEO | Other NEOs | PEO | Other NEOs | | SCT Amounts | $15,256,463 | $6,472,781 | $1,195,141 | $710,637 | $7,321,467 | $3,014,506 | | Subtract: Aggregate value for stock awards and option awards included in SCT amounts for the covered fiscal year | $(14,150,821) | $(5,788,972) | $- | $- | $(6,251,841) | $(2,345,183) | | Add: Fair value at year end of awards granted during the covered fiscal year that were outstanding and unvested at the covered fiscal year end | $5,504,217 | $2,251,725 | $- | $- | $6,962,777 | $2,642,227 | | Add (Subtract): Year-over-year change in fair value at covered fiscal year end of awards granted in any prior fiscal year that were outstanding and unvested at the covered fiscal year end | $- | $- | $7,390,670 | $1,948,868 | $(1,491,366) | $46,479 | | Add: Vesting date fair value of awards granted and vested during the covered fiscal year | $- | $- | $- | $- | $- | $- | | (Subtract) Add: Change as of the vesting date (from the end of the prior fiscal year) in fair value of awards granted in any prior fiscal year for which vesting conditions were satisfied during the covered fiscal year | $(3,496,498) | $(1,000,861) | $925,688 | $393,619 | $2,153,339 | $180,117 | | Add: Fair value at end of prior fiscal year of awards granted in any prior fiscal year that failed to meet the applicable vesting conditions during the covered fiscal year | $- | $- | $- | $- | $- | $- | | Add: Dividends or other earnings paid on stock or option awards in the covered fiscal year prior to vesting if not otherwise included in the total compensation for the covered fiscal year | N/A | N/A | N/A | N/A | N/A | N/A | | CAP Amounts (as calculated) | $3,113,362 | $1,934,673 | $9,511,499 | $3,053,124 | $8,694,375 | $3,538,147 |

  32. Pay Versus Performance

    | (3) Total Shareholder Return (“TSR”) represents the cumulative growth of a hypothetical $100 investment in the Company made as of December 31, 2020, reflected as of the end of each respective year. | | (4) Peer group TSR represents the cumulative growth of a hypothetical $100 investment made as of December 31, 2020 in the Nasdaq Biotechnology Index, reflected as of the end of each respective year. | | (5) Represents the amount of net loss reflected in our consolidated financial statements for each covered fiscal year. |

  33. Pay Versus Performance

    | Harrow, Inc. 2024 Proxy Statement | 27 |

  34. Pay Versus Performance

    Relationship Between Compensation Actually Paid And Cumulative TSR Relationship Of The Company’s TSR Relative To Its Peers