Material Agreement Form 8 K

On November 21, 2024, Biofrontera Inc., a Delaware corporation (the "Company"), entered into a Securities Purchase Agreement (the "Purchase Agreement") with its principal stockholders (the "Purchasers") providing for the private placement (the "Private Placement") to the Purchasers of $4,200,000 in aggregate principal amount of the Company's 10.0% Senior Secured Convertible Notes due November 22, 2027 (the "Notes"). The closing of the Private Placement occurred on November 22, 2024 (the "Closing Date").

The Notes bear interest at 10.0% per annum, payable quarterly in arrears on January 15, April 15, July 15 and October 15 of each year, commencing on January 15, 2025. Accrued interest on the Notes is paid on each such quarterly scheduled interest payment date by increasing the outstanding principal amount of the Notes in the amount of the interest accrued for the applicable interest period ending on such date and from and after such date interest shall accrue on the aggregate outstanding principal amount so increased. Upon written notice from the holder of the Notes to the Company that an Event of Default (as defined in the Notes) has occurred and is continuing, the interest will increase to 15% per annum from the date of such notice.

The Notes mature on November 22, 2027, unless earlier converted or repurchased. The Company may not redeem the Notes at its option prior to maturity. Upon maturity, the Company will pay to the holders of the Notes an amount in cash representing all of the outstanding aggregate principal amount of the Notes, together with any accrued and unpaid interest.

The Notes may be converted at any time by the noteholder to shares of Common Stock at an initial conversion price of $0.78 per share, subject to customary adjustments for stock splits, stock dividends and recapitalizations, as described in the Notes. Alternatively, the entire amount of the note will be automatically converted to shares of Common Stock if the 10-day volume weighted average price of a share of the Company's Common Stock on Nasdaq is greater than $2.50, and certain other conditions are met.

The Notes do not contain any ratchet or other financial antidilution provisions. The Notes purchased by certain of the Purchasers contain conversion limitations, providing that no conversion may be made if the aggregate number of shares of Common Stock beneficially owned by the holder thereof would exceed 9.99% immediately after conversion thereof, subject to certain increases not in excess of either 9.99% at the option of such holder.

The Notes contain restrictive covenants that, among other things, generally limit the ability of the Company and its subsidiaries to (i) create liens, (ii) pay dividends, acquire shares of capital stock and make payments on subordinated debt, (iii) incur indebtedness, or (iv) enter into transactions with affiliates. The foregoing restrictive covenants are subject to a number of important exceptions and qualifications, as set forth in the Notes.

The Notes provide for customary events of default which include (subject in certain cases to customary grace and cure periods), among others, the following: nonpayment of principal or interest; breach of covenants or other agreements in the Notes; and certain events of bankruptcy. Generally, if an event of default occurs and is continuing under the Notes, the holder thereof may require the Company to repurchase some or all of their Notes at a repurchase price equal to 100% of the principal amount of the Notes being repurchased, plus accrued and unpaid interest thereon.