Company: BIVIW
Filing Date: 2025-05-12
Form Type: 10-Q
Source: 0001520138-25-000144
Chunk: 63

Company: BIOVIE INC.
Filing Date: 2025-05-12
Form: 10-Q
Item: Part I, Item 8
Chunk 63
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),
the Company entered into a Loan and Security Agreement and the Supplement to the Loan and Security Agreement and Promissory Notes (together,
the “Loan Agreement”) with Avenue Venture Opportunities Fund, L.P. (“AVOPI”) and Avenue Venture Opportunities
Fund II, L.P. (“AVOPII,” and together with AVOPI, “Avenue”) for growth capital loans in an aggregate commitment
amount of up to $20 million (the “Loan”). On the Closing Date, $15 million of the Loan was funded (“Tranche 1”).
The Loan bore interest at an annual rate equal to the greater of (a) the sum of 7.00% plus the prime rate as reported in The Wall Street
Journal and (b) 10.75%. The Loan was secured by a lien upon and security interest in all of the Company’s assets, including intellectual
property, subject to agreed exceptions. The Loan was paid in full on its maturity date of December 1, 2024 along with a final payment
equal to 4.25% of the Loan commitment amount, or $850,000, the (“Loan Premium”) and the lien upon and security interest in
all of the Company’s assets was released.

The Loan Agreement included a conversion option to convert up to $5.0 million
of the principal amount of the Loan outstanding at the option of Avenue, into shares of the Company’s Common Stock at a conversion
price of $69.80 per share (the “Conversion Option”).

On the Closing Date, the Company also issued to Avenue
warrants to purchase 36,101 shares of Common Stock of the Company (the “Avenue Warrants”) at an exercise price per share equal
to $58.20. The Avenue Warrants are exercisable until November 30, 2026.

The amount of the carrying value of the notes payable
was determined by allocating portions of the outstanding principal of the notes, resulting in approximately $1.4 million allocated to
the fair value of the Avenue Warrants, and approximately $2.2 million allocated to the fair value of the embedded Conversion Option. Accordingly,
the total amount of unearned discount of approximately $3.6 million, the total direct financing cost of approximately $390,000 and the
Loan Premium of $850,000 were amortized using the effective interest method over the term of the Loan.

Total interest expense associated with the Loan was
approximately $312,000, which is reflected