Avid Bioservices Inc (CDMO)

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In the below hypothetical, wouldn't the 10.5% dividend be diluted by the amount of the fee for shorting?

The short increase is almost the exact number of preferred shares that are convertible at $3. Seems to support my theory that the IBs involved with the ATM and preferred deals worked together to artificially inflate the PPS to $3 and then short, giving them virtually a risk free 10.5% dividend.

And CP, your idea of this not being risk free because PPHM could convert the shares at $3.90 leaving you with a naked short is not accurate. In cases of preferred redemption that I can find, the company must give preferred shareholders adequate notice and set a date by which that would occur. They can't simply decide to do it one day, suck the PPHMP out of your account in exchange for $3.90 a share and leave you hanging. It's a pretty long process. Here's an example I could find of a preferred redemption process.