Avid Bioservices Inc (CDMO)

[jakedogman1]

from pphm 10-q.... someone's already on to this.... perhaps mgmt needs some more motivation to set things right...

On October 10, 2013, a derivative and class action complaint, captioned Michaeli v. Steven W. King, et al. , C.A. No. 8994-VCL, was
filed in the Court of Chancery of the State of Delaware against certain of our executive officers and directors. The complaint alleges that the
Company’s directors and executives breached their respective fiduciary duties in connection with certain purportedly improper compensation
decisions made by the Company’s Board of Directors during the past three fiscal years, including: (i) the grant of a stock option to Mr. King on
May 4, 2012; (ii) the non-routine broad-based stock option grant to the Company’s directors, executives, all other employees and certain
consultants on December 27, 2012; and (iii) the payment, during the past three fiscal years, of compensation to the Company’s non-employee
directors. In addition, the complaint alleges that the Company’s directors breached their fiduciary duty of candor by filing and seeking
stockholder action on the basis of an allegedly materially false and misleading proxy statement for the Company’s 2013 annual meeting of
stockholders. The defendants filed their answer to the complaint on February 5, 2014. We believe that the derivative and class action complaint
are without merit and intend to vigorously defend the action.