| Via EDGAR | ||
| November 19, 2007 | ||
United States Securities and Exchange Commission
Washington, DC 20549
Attention: Tabitha Aikens
| Re: | Biovest International, Inc. | |
| Form 10-KSB for the Fiscal Year Ended September 30, 2006 | ||
| Form 10-Q for the Quarterly Period Ended December 31, 2006 | ||
| File No. 000-11480 |
Dear Ms. Aikens:
In response to your telephonic inquiry on behalf of the Staff made October 26, 2007 to our Director of Legal Affairs, David Moser, please accept the attached schedule (Exhibit C) which provides the requested analysis of the impact of both New Market Tax Credit transactions closed April and December 2006. This information serves as a supplement to the Company’s response to Comment No. 4 in the Staff’s correspondence dated July 27, 2007.
As indicated in the Company’s previous response to the Staff’s letter dated July 27, 2007, which was submitted on August 27, 2007, the Company feels that the effect of these changes as shown on Exhibit C are immaterial to its overall financial results.
We appreciate the Staff’s comments. If you or the Staff have any further comments or questions, please contact our Director of Legal Affairs, David Moser at (813) 864-2554, or our outside counsel, Barry Grossman, Esq. at (212) 370-1300 or bigrossman@egsllp.com.
| Sincerely, | ||
| By: | /s/ James A. McNulty | |
| Name: | James A. McNulty | |
| Title: | Chief Financial Officer | |
324 S Hyde Park Avenue Suite 350 Tampa, Florida 33606
www.biovest.com tel:813 864 2554 fax: 813 258 6912
Summary:
Deferred financing costs related to NMTC I financing were as follows:
| Biovest Legal fees |
38,000 | Related to Laurus loan and accounted for as debt, thus remain as deferred financing costs | ||
| Biovest legal fees |
130,000 | these should instead have been deducted from Biovest APIC | ||
| VIE legal and accounting fees |
240,000 | these should instead have been deducted from VIE APIC and thus be part of NCI in VIEs upon consolidation | ||
| Management Fee paid by VIEs |
360,000 | these should instead have been shown as a prepaid asset on VIEs balance sheet, note this is already reflected as such in the Company's 06/30/07 Form 10-Q | ||
| Deferred financing costs related to NMTC II financing were as follows: | ||||
| Biovest legal fees |
496,000 | these should instead have been deducted from Biovest APIC | ||
| VIE legal and accounting fees |
185,000 | these should instead have been deducted from VIE APIC and thus be part of NCI in VIEs upon consolidation | ||
| Management Fee paid by VIEs |
115,000 | these should instead have been shown as a prepaid asset on VIEs balance sheet, note this is already reflected as such in the Company's 06/30/07 Form 10-Q | ||
Biovest International, Inc.
Exhibit C
Debit/(Credit)
| Prepaid Expenses |
Deferred Financing Costs |
Non- Controlling |
Accounts Payable |
APIC | Accumulated Deficit |
G&A Expense |
Interest Expense |
Non- Controlling |
Total Assets |
Total Liabilities |
Minority Interest in Cons Sub |
Total Stockholders' Deficit |
Net Loss | ||||||||||||||||||||||||||||
| 3 mo ended 6/30/06: |
|||||||||||||||||||||||||||||||||||||||||
| As previously reported |
142,000 | 729,000 | (3,600,000 | ) | (1,458,000 | ) | (35,059,000 | ) | 48,553,000 | 700,000 | 1,272,000 | — | 10,880,000 | (14,068,000 | ) | (6,000,000 | ) | 12,788,000 | 4,118,000 | ||||||||||||||||||||||
| adjustment |
348,000 | (706,000 | ) | 356,000 | (45,000 | ) | 130,000 | (83,000 | ) | 57,000 | (24,000 | ) | (116,000 | ) | (358,000 | ) | (45,000 | ) | — | 47,000 | (83,000 | ) | |||||||||||||||||||
| As restated |
490,000 | 23,000 | (3,244,000 | ) | (1,503,000 | ) | (34,929,000 | ) | 48,470,000 | 757,000 | 1,248,000 | (116,000 | ) | 10,522,000 | (14,113,000 | ) | (6,000,000 | ) | 12,835,000 | 4,035,000 | |||||||||||||||||||||
| % Difference |
3.3 | % | 0.3 | % | 0.0 | % | 0.4 | % | 2.0 | % | |||||||||||||||||||||||||||||||
| 9 mo ended 6/30/06: |
|||||||||||||||||||||||||||||||||||||||||
| As previously reported |
142,000 | 729,000 | (3,600,000 | ) | (1,458,000 | ) | (35,059,000 | ) | 48,553,000 | 2,446,000 | 1,498,000 | — | 10,880,000 | (14,068,000 | ) | (6,000,000 | ) | 12,788,000 | 9,910,000 | ||||||||||||||||||||||
| adjustment |
348,000 | (706,000 | ) | 356,000 | (45,000 | ) | 130,000 | (83,000 | ) | 57,000 | (24,000 | ) | (116,000 | ) | (358,000 | ) | (45,000 | ) | — | 47,000 | (83,000 | ) | |||||||||||||||||||
| As restated |
490,000 | 23,000 | (3,244,000 | ) | (1,503,000 | ) | (34,929,000 | ) | 48,470,000 | 2,503,000 | 1,474,000 | (116,000 | ) | 10,522,000 | (14,113,000 | ) | (6,000,000 | ) | 12,835,000 | 9,827,000 | |||||||||||||||||||||
| % Difference |
3.3 | % | 0.3 | % | 0.0 | % | 0.4 | % | 0.8 | % | |||||||||||||||||||||||||||||||
| 3 mo ended 9/30/06: |
|||||||||||||||||||||||||||||||||||||||||
| As previously reported |
266,000 | 776,000 | (3,600,000 | ) | (2,627,000 | ) | (35,034,000 | ) | 52,295,000 | 959,000 | 379,000 | — | 8,444,000 | (15,364,000 | ) | (6,000,000 | ) | 16,520,000 | 3,742,000 | ||||||||||||||||||||||
| adjustment |
336,000 | (672,000 | ) | 451,000 | (45,000 | ) | 130,000 | (200,000 | ) | 12,000 | (34,000 | ) | (95,000 | ) | (336,000 | ) | (45,000 | ) | — | (70,000 | ) | (117,000 | ) | ||||||||||||||||||
| As restated |
602,000 | 104,000 | (3,149,000 | ) | (2,672,000 | ) | (34,904,000 | ) | 52,095,000 | 971,000 | 345,000 | (95,000 | ) | 8,108,000 | (15,409,000 | ) | (6,000,000 | ) | 16,450,000 | 3,625,000 | |||||||||||||||||||||
| % Difference |
4.0 | % | 0.3 | % | 0.0 | % | 0.4 | % | 3.1 | % | |||||||||||||||||||||||||||||||
| Year ended 9/30/06: |
|||||||||||||||||||||||||||||||||||||||||
| As previously reported |
266,000 | 776,000 | (3,600,000 | ) | (2,627,000 | ) | (35,034,000 | ) | 52,295,000 | 3,405,000 | 1,877,000 | — | 8,444,000 | (15,364,000 | ) | (6,000,000 | ) | 16,520,000 | 13,652,000 | ||||||||||||||||||||||
| adjustment |
336,000 | (672,000 | ) | 451,000 | (45,000 | ) | 130,000 | (200,000 | ) | 69,000 | (58,000 | ) | (211,000 | ) | (336,000 | ) | (45,000 | ) | — | (70,000 | ) | (200,000 | ) | ||||||||||||||||||
| As restated |
602,000 | 104,000 | (3,149,000 | ) | (2,672,000 | ) | (34,904,000 | ) | 52,095,000 | 3,474,000 | 1,819,000 | (211,000 | ) | 8,108,000 | (15,409,000 | ) | (6,000,000 | ) | 16,450,000 | 13,452,000 | |||||||||||||||||||||
| % Difference |
4.0 | % | 0.3 | % | 0.0 | % | 0.4 | % | 1.5 | % | |||||||||||||||||||||||||||||||
| 3 mo ended 12/31/06: |
|||||||||||||||||||||||||||||||||||||||||
| As previously reported |
639,000 | 1,472,000 | (6,000,000 | ) | (2,921,000 | ) | (61,226,000 | ) | 76,245,000 | 1,272,000 | 2,035,000 | — | 8,960,000 | (17,034,000 | ) | — | 14,074,000 | 23,950,000 | |||||||||||||||||||||||
| adjustment |
438,000 | (1,443,000 | ) | 732,000 | (45,000 | ) | 626,000 | (308,000 | ) | 13,000 | (25,000 | ) | (96,000 | ) | (1,005,000 | ) | (45,000 | ) | — | 318,000 | (108,000 | ) | |||||||||||||||||||
| As restated |
1,077,000 | 29,000 | (5,268,000 | ) | (2,966,000 | ) | (60,600,000 | ) | 75,937,000 | 1,285,000 | 2,010,000 | (96,000 | ) | 7,955,000 | (17,079,000 | ) | — | 14,392,000 | 23,842,000 | ||||||||||||||||||||||
| % Difference |
11.2 | % | 0.3 | % | 0.0 | % | 2.3 | % | 0.5 | % | |||||||||||||||||||||||||||||||
| 3 mo ended 3/31/07: |
|||||||||||||||||||||||||||||||||||||||||
| As previously reported |
522,000 | 954,000 | (5,596,000 | ) | (3,525,000 | ) | (62,721,000 | ) | 81,695,000 | 1,889,000 | 1,556,000 | (478,000 | ) | 8,439,000 | (20,872,000 | ) | — | 18,029,000 | 5,450,000 | ||||||||||||||||||||||
| adjustment |
422,000 | (918,000 | ) | 424,000 | — | 626,000 | (554,000 | ) | (450,000 | ) | (176,000 | ) | 380,000 | (496,000 | ) | — | — | 72,000 | (246,000 | ) | |||||||||||||||||||||
| As restated |
944,000 | 36,000 | (5,172,000 | ) | (3,525,000 | ) | (62,095,000 | ) | 81,141,000 | 1,439,000 | 1,380,000 | (98,000 | ) | 7,943,000 | (20,872,000 | ) | — | 18,101,000 | 5,204,000 | ||||||||||||||||||||||
| % Difference |
5.9 | % | 0.0 | % | 0.0 | % | 0.4 | % | 4.5 | % | |||||||||||||||||||||||||||||||
| 6 mo ended 3/31/07: |
|||||||||||||||||||||||||||||||||||||||||
| As previously reported |
522,000 | 954,000 | (5,596,000 | ) | (3,525,000 | ) | (62,721,000 | ) | 81,695,000 | 3,160,000 | 3,591,000 | (478,000 | ) | 8,439,000 | (20,872,000 | ) | — | 18,029,000 | 29,400,000 | ||||||||||||||||||||||
| adjustment |
422,000 | (918,000 | ) | 424,000 | — | 626,000 | (554,000 | ) | (437,000 | ) | (201,000 | ) | 284,000 | (496,000 | ) | — | — | 72,000 | (354,000 | ) | |||||||||||||||||||||
| As restated |
944,000 | 36,000 | (5,172,000 | ) | (3,525,000 | ) | (62,095,000 | ) | 81,141,000 | 2,723,000 | 3,390,000 | (194,000 | ) | 7,943,000 | (20,872,000 | ) | — | 18,101,000 | 29,046,000 | ||||||||||||||||||||||
| % Difference |
5.9 | % | 0.0 | % | 0.0 | % | 0.4 | % | 1.2 | % | |||||||||||||||||||||||||||||||
| 3 mo ended 6/30/07: |
|||||||||||||||||||||||||||||||||||||||||
| As previously reported |
520,000 | 891,000 | (5,411,000 | ) | (4,480,000 | ) | (62,789,000 | ) | 93,738,000 | 160,000 | 458,000 | (112,000 | ) | 6,932,000 | (31,524,000 | ) | — | 30,003,000 | 12,043,000 | ||||||||||||||||||||||
| adjustment |
— | (891,000 | ) | 420,000 | (70,000 | ) | 626,000 | (85,000 | ) | 388,000 | 149,000 | (68,000 | ) | (891,000 | ) | (70,000 | ) | — | 541,000 | 469,000 | |||||||||||||||||||||
| As restated |
520,000 | — | (4,991,000 | ) | (4,550,000 | ) | (62,163,000 | ) | 93,653,000 | 548,000 | 607,000 | (180,000 | ) | 6,041,000 | (31,594,000 | ) | — | 30,544,000 | 12,512,000 | ||||||||||||||||||||||
| % Difference |
12.9 | % | 0.2 | % | 0.0 | % | 1.8 | % | 3.9 | % | |||||||||||||||||||||||||||||||
| 9 mo ended 6/30/07: |
|||||||||||||||||||||||||||||||||||||||||
| As previously reported |
520,000 | 891,000 | (5,411,000 | ) | (4,480,000 | ) | (62,789,000 | ) | 93,738,000 | 3,320,000 | 4,049,000 | (590,000 | ) | 6,932,000 | (31,524,000 | ) | — | 30,003,000 | 41,443,000 | ||||||||||||||||||||||
| adjustment |
— | (891,000 | ) | 420,000 | (70,000 | ) | 626,000 | (85,000 | ) | (49,000 | ) | (52,000 | ) | 216,000 | (891,000 | ) | (70,000 | ) | — | 541,000 | 115,000 | ||||||||||||||||||||
| As restated |
520,000 | — | (4,991,000 | ) | (4,550,000 | ) | (62,163,000 | ) | 93,653,000 | 3,271,000 | 3,997,000 | (374,000 | ) | 6,041,000 | (31,594,000 | ) | — | 30,544,000 | 41,558,000 | ||||||||||||||||||||||
| % Difference |
12.9 | % | 0.2 | % | 0.0 | % | 1.8 | % | 0.3 | % | |||||||||||||||||||||||||||||||