SEC Filing Document

Company: BIOVENTRIX, INC.
Ticker: 
CIK: 1283259
Filing Type: DRS/A
Document Type: DRS/A
Date Filed: 2025-12-12
Accession Number: 0001493152-25-027406
Exchange: 
SIC Code: 3841
SIC Description: Surgical & Medical Instruments & Apparatus
URL: https://www.sec.gov/Archives/edgar/data/1283259/000149315225027406/filename1.htm

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Leasehold improvements are depreciated over the shorter of either the useful life or the remaining term of the lease. Upon retirement or sale, the cost of assets disposed of and the related accumulated depreciation are removed from the accounts and any resulting gain or loss is credited or charged to other income or expense. Repairs and maintenance costs are expensed as incurred. Impairment of Long-Lived Assets – Long-lived assets consist of property and equipment. The Company assesses potential impairment losses on long-lived assets used in operations when events and circumstances indicate that assets might be impaired. The Company did not recognize any impairment losses in the nine months ended September 30, 2025, and 2024. BIOVENTRIX, INC. Notes to Consolidated Financial Statements September 30, 2025 and 2024 (unaudited) Advertising costs – Advertising costs are expensed as incurred. Advertising expenses were insignificant for the nine months ended September 30, 2025, and 2024.

Fair
value of financial instruments – The Company calculates the fair value of its assets and liabilities which qualify as financial
instruments and includes this information in the notes to the financial statements when the fair value is different than the carrying
value of those financial instruments. The estimated fair value of accounts receivable, other receivables, prepaid expenses, accounts
payable and accrued liabilities approximate the carrying amounts due to the relatively short maturity of these instruments. None of these
instruments are held for trading purposes.

Revenue
Recognition – the Company adopted ASU No. 2014-09 Revenue from Contracts with Customers (“ASC 606”) as of January
1, 2018. The standard establishes a single revenue recognition model for all contracts with customers, eliminates industry specific requirements,
and expands disclosure requirements.

Under
ASC 606, revenue is recognized when a customer obtains control of promised goods or services, in an amount that reflects the consideration
which the entity expects to receive in exchange for those goods or services.

The
Company records product revenue primarily from the sale of its Revivent TC™ TransCatheter Ventricular Enhancement System (“System”).
The Company is focused on the RELIVE clinical trial in the United States and therefore is not focused on commercialization of the System
although the Company has obtained approval to sell the System in Europe.

Research
and development – Costs to develop the Company’s products are expensed as incurred. These costs include salaries and
other personnel related expenses, contractor fees, facility costs, supplies, depreciation of equipment, and other outside services associated
with the design and development of new products prior to the establishment of their technological feasibility.

Income
taxes – The Company accounts for income taxes under the asset and liability method, which requires that deferred income taxes
be provided for temporary differences between the tax basis of the Company’s assets and liabilities and their financial statements,
reported amounts. In addition, deferred tax assets are recorded for the future benefit of utilizing net operating losses and research
and development credit carryforwards. A valuation allowance is provided against deferred tax assets unless it is more likely than not
that they will be realized.

evaluating the ability to recover its deferred income tax assets, the Company considers all available positive and negative evidence,
including its operating results, ongoing tax planning and forecasts of future taxable income on a jurisdiction-by-jurisdiction basis.
In the event the Company determines that it would be able to realize its deferred income tax assets in the future in excess of their
net recorded amount, it would make an adjustment to the valuation allowance that would reduce the provision for income taxes. Conversely,
in the event that all or part of the net deferred tax assets are determined not to be realizable in the future, an adjustment to the
valuation allowance would be charged to earnings in the period when such determination is made. The Company has recorded a full
valuation allowance on its net deferred tax assets.

BIOVENTRIX,
INC.

Notes
to Consolidated Financial Statements

September
30, 2025 and 2024

(unaudited)

Accounting
for uncertain tax positions requires the Company to use a two-step approach to recognize and measure uncertain tax positions. The first
step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates that it is more likely
than not that the position will be sustained on audit, including resolution of related appeals or litigation processes, if any. The second
step is to measure the tax benefit as the largest amount that is more than 50% likely of being realized upon settlement. The Company
classifies the liability for unrecognized tax benefits as current to the extent that the Company anticipates payment (or receipt) of
cash within one year. Interest and penalties related to uncertain tax positions are recognized in the provision for income taxes.

Stock-based
compensation – The Company measures and recognizes stock-based compensation expense in the financial statements for
all share-based payment awards made to employees, directors, and non-employees based on estimated fair values on the date of grant based
on using the Black- Scholes option pricing model. Common stock issued for services are recorded based on the fair value of the consideration
received or the fair value of the equity instruments issued, whichever is more reliably measurable.

The
Company’s determination of fair value of share-based payment awards on the date of grant using the Black-Scholes option-pricing
model is affected by the Company’s estimated fair value of common stock as well as assumptions regarding a number of highly complex
and subjective variables. These variables include, but are not limited to:

Expected
Term – Expected term represents the period that the Company’s stock-based awards are expected to be outstanding and is
determined using the simplified method.

Expected
Volatility – Expected volatility is estimated by studying the volatility of comparable public companies for similar terms.

Expected
Dividend – The Black-Scholes valuation model calls for a single expected dividend yield as an input.

Risk-Free
Interest Rate – The risk-free interest rate is based on the U.S. Treasury zero-coupon issued in effect at the time of grant
for periods corresponding with the expected term of the option.

Stock-based
compensation expense for all share-based payment awards is based on the grant date calculated fair value. The Company recognizes these
compensation costs, net of an estimated forfeiture rate, and recognizes the compensation costs for only those shares expected to vest
on a straight-line basis over the requisite service period of the award, which is generally the option vesting term of four years. The
Company estimated the forfeiture rate based on its historical experience for annual grant years where the majority of the vesting terms
have been satisfied.

BIOVENTRIX,
INC.

Notes
to Consolidated Financial Statements

September
30, 2025 and 2024

(unaudited)

The
Financial Accounting Standards Board (“FASB”) has issued several new Accounting Standards Updates (“ASUs”)
that are not yet effective for the Company, including:

●	ASU 2023-06, Disclosure Improvements ;

●	ASU
2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures ;

●	ASU
2024-03 , Compensation—Expense Disaggregation Disclosures ;

●	ASU
2025-03 , Consolidation (Topic 810):
Business Combinations Involving a Variable Interest Entity (VIE).

The
Company is currently evaluating the impact of each of these standards on its consolidated financial statements and related disclosures.
Based on its preliminary assessment, the Company does not expect the adoption of these ASUs to have a material impact on its
financial position, results of operations, or cash flows. The Company will adopt each ASU in accordance with its required effective
date.

Note
3 – Fair value of derivative liability

The
Company has identified an embedded derivative related to the maturity conversion feature of its secured convertible notes that is required
to be bifurcated and accounted for separately in accordance with ASC 815, Derivatives and Hedging. The derivative liability is measured
at fair value at each reporting date, with changes in fair value recognized in the consolidated statement of operations.

September 30, 2025, the fair value of the derivative liability was $1,069,708. The fair value was estimated using a probability-weighted
expected return model, which incorporates significant unobservable inputs, including probability and timing of different events, discount
rate and value of the Company’s common stock. Accordingly, the derivative liability is classified within Level 3 of the fair value
hierarchy under ASC 820.

The primary
valuation assumptions used were:

Maturity date 12/31/2027

Bond rate (CCC) 11.43%

Volatility 98.0%

Probability of Qualified Financing 25	%

Timing of Qualified Financing 12/15/25

Probability of Qualified IPO 50	%

Timing of Qualified IPO 12/15/25

Value of common stock, per 409A valuation $	0.81

The
following table presents the change in the fair value of the derivative liability during the nine months ended September

Fair value at January 1, 2025 $	364,398

Initial recognition upon issuance 701,876

Losse recognized in earnings 3,434

Transfers in / out of Level 3 -

Fair value at September 30, 2025 $	1,069,708

Changes in the fair value
of the derivative liability resulted in an unrealized loss of $3,434 for the nine months ended September
30, 2025, which was recognized in other expense in the consolidated statement of operations.