Avid Bioservices Inc (CDMO)

[Protector]

PPHM Annual Voting Wrap-up

SYNTHESIZED (lets hope I have it all right this time, I hate this legal stuff. Pls react if you see errors!)

1) passing proposal #3 as ROUTINE is legal (within NYSE rule =NASDAQ too)
2) proposal #3 was NOT proposed unanimously by the BoD
3) The proposal is for a 175Mil shares shelf increase
4) All shares, voted, non voted and abstained are in quorum count
5) quorum for proposal #3 will surely be reached given point 4 above
6) not voting is a NO vote if broker doesn't vote instead
7) not voting may be a YES or NO vote if broker votes
8) brokers don't vote, vote by proxy proportionality or as advised (=YES)
9) owner voting NO, is a no vote
10) owner voting YES, is a YES vote
11) voting by proxy is open since material availability
12) broker voting AS OF 15 days before annual in absence of owner instructions
13) votes can be changed till/incl annual with needed documentation
14) PPHMP share cannot vote
15) A majority (50%+1 vote) is needed to pass proposal #3
16) Given pts 4 & 15, about 101Mil YES votes would be needed to pass proposal #3
17) BoD doesn't expect many Broker non-votes
18) From Ameritrade and Interactive Brokers we know they DON'T vote
19) Sub-brokers CANNOT vote (they use a 3rd party, e.g. IB, platform)
20) DVP accounts (e.g. IIs, funds, pros) they NEVER vote without instructions (against policy)
21) PPHM can keep the annual meeting open to convince brokers to vote YES
22) Owners can instruct brokers NOT to vote their shares in case of point 21

Actually if there would be a family (as per BCS) that doesn't want/cannot vote without disclosing identity then PPHM could try to convince their broker(s) to make them vote YES because those brokers could be identified based on the # of shares they represent. Of course such accounts could EXPLICITLY give instructions NOT TO VOTE which is something they CAN do anonymously without documentation leaving the broker and maintain anonymity. Thing is that if such family would exist I doubt they wouldn't use DVP accounts in which case the broker would do nothing and contact his client. In the DVP world the client is near Holy!

(DVP=Delivery Versus Payment accounts)

I also wonder if the person on the BoD that did NOT want proposal #3 has managed to lay the voting cards as such that proposal #3 only passes if the shareholders explicitly or per broker vote, vote YES.

Actually if the above is correct then PPHM is NOT pushing proposal #3 though our throats, on the contrary, 101Mil owner/broker YES votes are needed to pass proposal #3.

And that raises the question that has been raised before by some on this board, WHY would PPHM format the vote in such way that passing depends on the owner voting YES or on the lottery of brokers behaviour resulting in YES votes. I cannot imagine that when we on this board managed to find out that many big brokers do not vote at all (hence a NO vote if the owner doesn't vote himself) that PPHM or PPHM's advisor would not know that too.

Could PPHM having been counting on the fact that if NOT voting is an IMPLICIT NO vote, most shareholders will do NOTHING instead of using the proxy to vote EXPLICITLY NO. (Human laziness :) And hence there would be MUCH MORE IMPLICIT votes but with that DIFFERENCE that IMPLICIT votes can be turned to YES via the brokers while for EXPLICIT voting that people would otherwise have done this is NOT possible. Hi-jacking votes kind of like a terrorist making sure you board the plain he is going to hi-jack.

So actually all those that really want to be 100% SURE of their YES or NO vote MUST explicitly use the Proxy and vote in order to be sure that their votes are not changed by mechanism behind their back or they must instruct their brokers NOT to vote their shares AT ALL (but that would be a NO vote, there is no YES version of that scenario).

I am really curious how all this is going to play out and if we are going to get more, and sufficiently up-front and not just in time AT the annual, information by PPHM telling us WHY they want this shelf and why there was no unanimity in the BoD for proposal #3. My hopes to get that get lower as time passes and if we don't get anything I am going to be VERY VERY disappointed because it is not asking for much, just some explanation to shareholders that all together OWN the company.