Avid Bioservices Inc (CDMO)

[RRdog]

Open letter to PL and ES:

Dealing with the Nasdaq requirement and alleviating fears of another reverse split are small steps in the right direction.

Nevertheless, I feel compelled to point out that carrying a "going concern" letter for the better part of a decade has damaged the company image and stock price. This really inhibits buying and leads to a great deal more dilution over time. Many institutions can not buy a company with a "going concern" letter.

Go borrow a little money. It's cheap insurance and it triples your negotiating posture. It's bad enough to say to the market place at large that "you have great science but are willing to sell it through ATM for next to nothing", but, its really stupid to make that same statement to the BP with whom you are trying to negotiate price.

If you can't negotiate a loan vs Avid assets or you don't like the rate, prepayment penalty or warrants (all of which can be negotiated around), why not walk into Allied Capital and borrow against your backlog and receivables. Obviously, the 30mm in Avid backlog is good quality if you are getting 7MM in non- refundable prepayment to hold slots. Consider this a form of bridge financing.

Regards,
RRdog