Company: LNAI
Filing Date: 2025-02-19
Form Type: 10-Q/A
Source: 0001731122-25-000250
Chunk: 35

Company: Lunai Bioworks Inc.
Filing Date: 2025-02-19
Form: 10-Q/A
Chunk 35
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 the balance sheet net of discount. On February 16, 2024,
the Company received notice from the holder to exercise 471,699warrants outstanding at $0.53per share and apply $250,000of the note balance to the exercise price of the warrants. For the three and nine months ended March 31, 2024, discount amortization
of zero 0and $50,000was charged to interest expense, respectively. As of March 31, 2024, the Company accrued $46,583of interest expense that is included in accrued expenses on the balance sheet. The Note balance, net of discount at March 31,
2024 is $750,000.

19

RENOVARO INC. AND SUBSIDIARIES
NOTES TO UNAUDITED RESTATED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 8 — DEBT (Continued)

Promissory Note —On
March 30, 2020 (the “Issuance Date”), the Company issued a Promissory Note in the principal amount of $5,000,000 (the “Promissory
Note”) to the Holder. The principal amount of the Promissory Note was originally payable on November 30, 2021 (the “Maturity
Date”). The Promissory Note bore interest at a fixed rate of 6% per annum, computed based on the number of days between the Issuance
Date and the Maturity Date, and the interest was prepaid by the Company in full on the Issuance Date through the issuance of 188,485
shares of the Company’s Common Stock based on the closing market price on that date for a total value of $501,370. The Company
evaluated the Promissory Note and PIK interest in accordance with ASC 470-Debt and ASC 835-Interest, respectively. Pursuant to ASC 470-20,
proceeds received from the issuance are to be recognized at their relative fair value, thus the liability is shown net of the corresponding
discount of $493,192, which is the relative fair value of the shares issued for the PIK interest on the closing date using the effective
interest method. The discount of $493,192 will be accreted over the life of the Promissory Note.

On February 11, 2021, the Company
entered into an amendment to the Promissory Note that extended the Maturity Date