The new DiP loan takes precedence over all prior loans, including previous DiP loans and is secured by first dibs on assets of the company. It is at a unreasonably loan shark high 16% almost guaranteeing a default. If I were a cynic, I would say Corps almost would want BVTI to continue dragging its feet and then for 450k it will own the patents.
On March 14, 2013, Biovest International, Inc. (the "Company") was authorized to receive an interim advance in an amount of up to $700,000 in Debtor-in-Possession superpriority first-secured financing (the "DIP Loan") pursuant to the Interim Order Granting Debtor's Emergency Motion For Interim And Final Orders Under 11 U.S.C. �� 105, 361, 362, 363(C), 364(C), 364(D)(1), 364(E) and 507 and Fed. R. Bankr. P. 2002, 4001 and 9014: (I) Authorizing The Debtor To Obtain Postpetition Financing And Grant Senior Liens And Superpriority Administrative Expense Status; (II) Authorizing The Debtor To Use Cash Collateral; (III) Granting Adequate Protection To Prepetition Senior Secured Creditors; and (IV) Scheduling A Final Hearing Pursuant To Bankruptcy Rules 2002, 4001 and 9014 (the "Interim Order") entered by the U.S. Bankruptcy Court for the Middle District of Florida, Tampa Division. Pursuant to the Interim Order, Corps Real, LLC advanced an initial tranche of $450,000 to the Company on March 15, 2013. Pursuant to the Interim Order, the initial tranche of the DIP Loan will bear interest at 16% per annum, will have a maturity date of December 31, 2013, and is secured by a first lien on all assets of the Company.