BioVie Inc. agreed to sell $3.2 million of preferred stock and warrants to Acuitas Group Holdings LLC.

The Beverly, Mass.-based biopharmaceutical company issued 2,133,332 series A preferred shares at $1.50 each. The stock came with warrants to buy 213,333,200 class A common shares at 1.8 cents each, subject to adjustment.

BioVie said each preferred share automatically converts into 100 common shares, subject to adjustment. The company has received regulatory approval to increase the number of its authorized common shares, to accommodate the conversion.

Acuitas also received a two-week option to buy 200 million common shares, along with associated warrants, at 1.5 cents each. The holding company can exercise the option one year after the sale's July 3 closing, granted that BioVie has not obtained $3 million of funding through various nondilutive grants.

Additionally, BioVie appointed Acuitas Chairman Terren Peizer to be its CEO and a director. Acuitas is Peizer's personal investment vehicle. He also serves as CEO and chairman at Catasys Inc. as well as Neurmedix Inc.

Jonathan Adams, BioVie's prior CEO, was appointed president and COO. He remains on the company's board.