Avid Bioservices Inc (CDMO)

[Firechief]

Fire Fox, I went back and re-read your old post -- and agree with your strategic points. I'm going to add two thoughts after thinking more about the topic:

1) taking down only $15M saves PPHM $100,000 a month because of the negative carry on surplus cash (PPHM earns zero on the surplus cash, but pays approximately 8% on the "loan."). Tactically, PPHM did the right thing from a corp fin perspective. I'm impressed they extracted this concession from Oxford.

2) there is no mention of a commitment fee on the second $15M tranche, only an "option" to tap another $15M subject to certain milestones. Usually the interest rate and commitment fee are lumped together in press releases like the one PPHM issued, so a probable (but not definitive) conclusion is that there is not one. That's off-market, and bullish, because it says the lenders caved.

Conclusion: PPHM has something that others, including the lenders who are insiders, want.