Exhibit 10.1


 


AVID BIOSERVICES, INC.


 


EXECUTIVE SEVERANCE PLAN


 


1.             Purpose.               The purpose of this Avid Bioservices, Inc. Executive Severance Plan (the “Plan”) is to encourage employees
of Avid Bioservices, Inc. (the “Company”) to remain in the employ of the Company and its Affiliates by
providing severance protections to such employees in the event that their employment is terminated under the circumstances described
in this Plan. Nothing in this Plan shall be construed as creating an express or implied contract of employment and nothing shall
alter the “at will” nature of the Participants’ employment with the Company or its Affiliates. This Plan document
also serves as the Summary Plan Description for the Plan. All capitalized terms shall have the meanings ascribed to them in the
Plan.


 


2.             Definitions.          The following terms shall be defined as set forth below:


 


(a)          “Administrator” means
the Company’s board of directors or such committee of the Company’s board of directors that has been delegated administrative
authority with respect to this Plan by the Company’s board of directors.


 


(b)           “Affiliate”
means, with respect to any person or entity, any other person or entity that, directly or indirectly, through one or more intermediaries,
controls, or is controlled by, or is under common control with, such person or entity. For purposes of this definition, “control,”
when used with respect to any person or entity, means the power to direct the management and policies of such person or entity, directly
or indirectly, whether through ownership of voting securities, by contract or otherwise; and the terms “controlling” and “controlled”
have meanings correlative to the foregoing.


 


(c)           “Cause”
means the Participant (i) breaches in any material respect or fails to fulfill in any material respect fiduciary duty owed to Company;
(ii) breaches in any material respect the terms of Participant’s employment agreement with the Company, if any, or any
other confidentiality or non-solicitation, non-competition agreement between Company and Participant; (iii) pleads guilty to or is
convicted of a felony; (iv) is found to have engaged in any reckless, fraudulent, dishonest or grossly negligent misconduct, (v) fails
to perform his or her duties to the Company, provided that Participant fails to cure any such failure within thirty (30) days after written
notice from Company of such failure, provided further, however, that such right to cure shall not apply to any repetition of the same
failure previously cured hereunder; or (vi) violates any material rule, regulation or policy of the Company that may be established
and made known to Company's employees from time to time, including without limitation, the Company Employee Handbook.


 


(d)           “CEO
Participant” means the Participant serving as the Company’s Chief Executive Officer as of immediately prior to his
or her Separation Date (or the date on which a reduction of his or her title occurred without his or her consent).


 


(e)           “Change
in Control” or “CIC” means the (i) acquisition by any one person, or more than one person acting
as a group (as determined in accordance with Treasury Regulation Section 1.409A-3(i)(5)), of stock of the Company that, together with
stock held by such person or group, constitutes more than 50% of the total fair market value or total voting power of the stock of the
Company, (ii) consummation of a merger, consolidation or similar transaction involving (directly or indirectly) the Company and, immediately
after the consummation of such merger, consolidation or similar transaction, the stockholders of the Company immediately prior thereto
do not own, directly or indirectly, either (A) outstanding voting securities representing more than 50% of the combined outstanding voting
power of the surviving entity in such merger, consolidation or similar transaction or (B) more than 50% of the combined outstanding voting
power of the parent of the surviving entity in such merger, consolidation or similar transaction, in each case in substantially the same
proportions as their ownership of the outstanding voting securities of the Company immediately prior to such transaction, or (iii) sale
of all or substantially all of the consolidated assets of the Company and its subsidiaries, other than a sale of all or substantially
all of the consolidated assets of the Company and its subsidiaries to an entity, more than 50% of the combined voting power of the voting
securities of which are owned by stockholders of the Company in substantially the same proportions as their ownership of the outstanding
voting securities of the Company immediately prior to such sale.


 


(f)           “CIC
Period” means that period commencing on the date that is three (3) months prior to a Change in Control and ending on the
date that is (12) months following a Change in Control.


 


 


 






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(g)           “CIC
Severance Period” shall mean with respect to a Participant, the period beginning on the Participant’s Separation Date
through the date occurring the applicable number of months thereafter as specified on Exhibit A.


 


(h)          “COBRA” shall
mean the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended.


 


(i)            “Code” shall
mean the Internal Revenue Code of 1986, as amended.


 


(j)           “Covered
Termination” shall mean a termination of the Participant’s employment (i) by the Participant for Good Reason
or (ii) by the Company or one of its Affiliates (or any successor to the Company or one of its Affiliates) without Cause.


 


(k)           “Eligible
Executives” shall mean, as of the applicable measurement date, all individuals employed by the Company at the C-Suite level
and the Vice President level.


 


(l)            “Equity
Awards” shall mean a Participant’s outstanding stock options, stock appreciation rights, restricted stock units, performance
shares and performance stock units of the Company and any other Company equity compensation awards. For purposes of this “Equity
Award” definition, the term “Company” will be interpreted to include any Company Affiliate and any successor to the
Company or any Company Affiliate.


 


(m)          “ERISA”
shall mean the Employee Retirement Income Security Act of 1974, as amended.


 


(n)           “Good
Reason” shall mean, with respect to any Participant, any one of the following that occurs without the consent
of the Participant: (i) a material reduction in the Participant’s duties, authority, or responsibilities relative to Participant’s
duties, authority, or responsibilities as in effect immediately prior to such reduction; provided, however, that continued
employment following a Change in Control with substantially the same responsibility with respect to the Company’s business and operations
will not constitute a material reduction in title, duties, authority, or responsibilities, (ii) a material reduction in the Participant’s
annual base salary, other than a reduction that occurs in connection with a Company-wide decrease in executive team compensation, (iii)
a relocation of the Participant’s principal workplace by more than 50 miles that increases the Participant’s one way commute
based on his or her residence as of immediately prior to the time that the relocation is announced by at least 50 miles, or (iv) the Company’s
material breach of any written compensatory agreement as to which both the Company (or a Company Affiliate) and the Participant are parties; provided,
however, that in each such case, the Participant must provide 30 days’ notice of the Participant’s intent to resign for
Good Reason within 90 days after the Participant learns of a potential Good Reason trigger, and the resignation shall be for Good Reason
only if the potential Good Reason trigger remains substantially uncured as of the specified date of resignation.


 


(o)          “Separation
Date” shall mean the date that a Participant’s employment with the Company (or any successor) or any of its Affiliates
ends. Notwithstanding the foregoing, a Participant’s employment shall not be deemed to have been terminated solely as a result of
(i) the Participant becoming an employee of any direct or indirect successor to the business or assets of the Company, (ii) the Participant
being transferred to, between or among Company Affiliates, or (iii) the sale by the Company or one of its Affiliates of the employing
Affiliate of the Participant.


 


(p)           “Severance
Period” shall mean, with respect to a Participant, the period beginning on the Participant’s Separation Date through
the date that is the applicable number of months thereafter as specified on Exhibit A.


 


3.             Administration
of the Plan.


 


(a)           Administrator.
The Plan shall be administered by the Administrator.


 


(b)           Powers
of Administrator. Subject to the provisions of Section 19, the Administrator shall have all powers necessary to enable
it properly to carry out its duties with respect to the complete control of the administration of the Plan. Not in limitation, but in
amplification of the foregoing, the Administrator shall have the power and authority in its discretion to:


 


 


 






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(i)           construe
the Plan to determine all questions that shall arise as to interpretations of the Plan’s provisions;


 


(ii)          determine
which individuals are and are not Participants, the benefits to which any Participants may be entitled, the eligibility requirements for
participation in the Plan and all other matters pertaining to the Plan;


 


(iii)         adopt
amendments to the Plan which are deemed necessary or desirable to comply with all applicable laws and regulations, including but not limited
to Section 409A of the Code and the guidance thereunder;


 


(iv)         make
all determinations it deems advisable for the administration of the Plan, including the authority and ability to delegate administrative
functions to a third party;


 


(v)          decide
all disputes arising in connection with the Plan;


 


(vi)         in
the event of an impending Change in Control, the Administrator may appoint a person (or persons) independent of the third-party effectuating
the Change in Control to be the Administrator effective upon the occurrence of a Change in Control (which may be one or more members of
the Company’s Board of Directors prior to such Change in Control) and such Administrator shall not be removed or modified following
a Change in Control, other than at its own initiative (the “Independent Administrator”); and


 


(vii)        otherwise
supervise the administration of the Plan.


 


(c)           If,
due to errors in drafting, any Plan provision does not accurately reflect its intended meaning, as demonstrated by consistent interpretations
or other evidence of intent (by the Company or the Administrator), or as determined by the Administrator in its sole and absolute discretion,
the provision shall be considered ambiguous and shall be interpreted by the Administrator and all Plan representatives in a fashion consistent
with its intent, as determined in the sole and absolute discretion of the Administrator, but in no event shall such interpretation result
in a vesting of Plan benefits.


 


(d)           All
decisions and interpretations of the Administrator (including the Independent Administrator) shall be final and binding on all persons,
including the Company and Participants; provided that in the event that no Independent
Administrator is appointed, any determination after a Change in Control by the Administrator of whether “Cause” or “Good
Reason” exists shall be subject to de novo review.


 


4.       Termination
Benefits Generally. In the event that a Participant’s employment with the Company or one of its Affiliates is terminated for
any reason, the Company shall (or shall use commercially reasonable efforts to cause the employing Affiliate to) pay or provide, to the
extent applicable, to the Participant any earned but unpaid salary, unpaid expense reimbursements in accordance with the policy of the
Company or the employing Affiliate, and accrued but unused vacation to the extent required by applicable law or Company policy, if any,
within the time required by law but in no event more than 60 days after the Separation Date and the Participant shall remain entitled
to any vested benefits the Participant may have under any employee benefit plan of the Company or its Affiliates in accordance with the
terms and conditions of such employee benefit plan (collectively, the “Accrued Benefits”)


 


5.             Severance
Benefits Upon a Covered Termination Not in Connection with a Change in Control.


 


(a)           If
a Covered Termination occurs outside of the CIC Period with respect to a Participant, in addition to the Accrued Benefits, subject to
his or her execution of a separation agreement in a form satisfactory to the Company containing, among other provisions, a general release
of claims in favor of the Company and related persons and entities, confidentiality, return of property, non-disparagement and reaffirmation
of the Participant’s post-termination restrictive covenants pursuant to any agreement entered into between the Participant and the
Company or any Company Affiliate (the “Separation Agreement”) and the Separation Agreement becoming effective
and irrevocable, all within the time period set forth in the Separation Agreement but in no event more than 60 days after the Separation
Date, and subject to the Participant complying with the Separation Agreement;


 


 


 






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(i)           the
Company shall (or shall use commercially reasonable efforts to cause the employing Affiliate to) pay the Participant his or her base salary
in effect immediately prior to the Covered Termination for the duration of the Participant’s Severance Period; and


 


(ii)          provided
the Participant timely elects continued coverage under COBRA, the Company shall (or shall use commercially reasonable efforts to cause
the employing Affiliate to) reimburse the Participant in an amount equal to the Participant’s COBRA premiums sufficient to continue
group health insurance coverage for the Participant and any covered dependents, less the employee portion of such coverage in effect as
of the Separation Date, until the sooner of (A) the end of the Participant’s Severance Period; (B) the date the Participant is no
longer eligible for COBRA coverage; or (C) the date the Participant becomes eligible for health insurance coverage through another employer.


 


(b)           Subject
to Section 8 and Section 11 below, the cash severance payable pursuant to Section 5(a)(i) shall
be paid out in substantially equal installments in accordance with the Company’s (or the applicable Company Affiliate’s) payroll
practices over the Severance Period, commencing within 70 days after the Separation Date following the date on which the Separation
Agreement becomes effective and irrevocable; provided, however, if Section 409A of the Code applies to such payments
and the 60-day release consideration period begins in one calendar year and ends in a second calendar year, the severance shall begin
to be paid in the second calendar year by the last day of such 60-day release consideration period; and provided further,
that the initial payment shall include a catch-up payment to cover amounts retroactive to the day immediately following the Separation
Date.


 


(c)           If
a Participant’s employment is terminated in any circumstance outside of the CIC Period other than as a result of a Covered Termination,
the Participant will not be entitled to any compensation or benefits under this Plan other than the Accrued Benefits.


 


6.             Severance
Benefits Upon a Covered Termination in Connection with a Change in Control.


 


(a)           If
a Covered Termination occurs within the CIC Period with respect to a Participant, in addition to the Accrued Benefits, subject to his
or her execution of a Separation Agreement and the Separation Agreement becoming effective and irrevocable, all within the time period
set forth in the Separation Agreement but in no event more than 60 days after the Separation Date, and subject to the Participant
complying with the Separation Agreement;


 


(i)           the
Company shall (or shall use commercially reasonable efforts to cause the employing Affiliate to) pay the Participant a lump sum amount
equal to his or her base salary plus target bonus in effect immediately prior to the Covered Termination for the number of months in the
CIC Severance Period;


 


(ii)          all
of such Participant’s outstanding (as of immediately prior to the Covered Termination, but subject to any maximum term) Equity Awards
shall vest in full; provided, however, if vesting is otherwise based on satisfaction of performance objectives, such objectives
shall be deemed satisfied at 100% of target for each performance period (i.e., the current performance period in which the Covered Termination
occurred and each subsequent performance period provided in the Equity Award(s)); and


 


(iii)         provided
the Participant timely elects continued coverage under COBRA, the Company shall (or shall use commercially reasonable efforts to cause
the employing Affiliate to) reimburse the Participant in an amount equal to the Participant’s COBRA premiums sufficient to continue
group health insurance coverage for the Participant and any covered dependents, less the employee portion of such coverage in effect as
of the Separation Date, until the sooner of (A) the end of the Participant’s CIC Severance Period; or (B) the date the Participant
is no longer eligible for COBRA coverage.


 


(b)           Subject to Section 8 and Section 11 below, the severance benefits payable pursuant
to Section 6(a) (i) and (ii) shall be paid within 70 days after the Separation Date following the date on
which the Separation Agreement becomes effective and irrevocable; provided, however, if Section 409A of the Code
applies to such payment and the 60-day period begins in one calendar year and ends in a second calendar year, the severance shall be
paid in the second calendar year by the last day of such 60-day period.


 


(c)           If
a Participant’s employment is terminated in any circumstance during the CIC Period other than as a result of a Covered Termination,
the Participant will not be entitled to any compensation or benefits under this Plan other than the Accrued Benefits.


 


 


 






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(d)           Severance
benefits under this Section 6 are not meant to duplicate severance benefits received under Section 5, and
will be offset for any prior amounts or benefits previously received by the Participant pursuant to Section 5.


 


7.             Withholding.
All payments made pursuant to this Plan shall be subject to any tax or other amounts required to be withheld by the Company or an Affiliate
of the Company under applicable law.


 


8.             Section
409A.


 


(a)           The
payments under this Plan are intended to comply with or be exempt from Section 409A of the Code and, accordingly, to the maximum extent
permitted, this Plan shall be interpreted to be in compliance therewith. Notwithstanding any provision of this Plan to the contrary, in
the event that the Administrator determines that any amounts payable hereunder will be subject to Section 409A of the Code, the Administrator
may (without any obligation to do so or to indemnify the Participant for failure to do so) (i) adopt such amendments to this Plan or adopt
such other policies and procedures (including amendments, policies and procedures with retroactive effect) that it determines to be necessary
or appropriate to preserve the intended tax treatment of the benefits provided by this Plan, to preserve the economic benefits of this
Plan and/or (ii) take such other actions it determines to be necessary or appropriate to exempt the amounts payable hereunder from Section
409A of the Code or to comply with the requirements of Section 409A of the Code and thereby avoid the application of penalty taxes thereunder.
Each payment pursuant to this Plan is intended to constitute a separate payment for purposes of Treasury Regulation Section 1.409A-2(b)(2).


 


(b)           To
the extent that any payment or benefit described in this Plan constitutes “non-qualified deferred compensation” under Section 409A
of the Code, and to the extent that such payment or benefit is payable upon the Participant’s termination of employment, then such
payments or benefits shall be payable only upon the Participant’s “separation from service” within the meaning of Section
409A of the Code. The determination of whether and when a separation from service has occurred shall be made in accordance with the presumptions
set forth in Treasury Regulation Section 1.409A-1(h).


 


(c)           Anything
in this Plan to the contrary notwithstanding, if at the time of a Participant’s “separation from service” within the
meaning of Section 409A of the Code, the Company determines that the Participant is a “specified employee” within the meaning
of Section 409A(a)(2)(B)(i) of the Code, then to the extent any payment or benefit that the Participant becomes entitled to under this
Plan would be considered deferred compensation subject to the twenty percent (20%) additional tax imposed pursuant to Section 409A(a)
of the Code as a result of the application of Section 409A(a)(2)(B)(i) of the Code, such payment shall not be payable and such benefit
shall not be provided until the date that is the earlier of (i) six (6) months and one (1) day after the Participant’s separation
from service, or (ii) the Participant’s death. If any such delayed cash payment is otherwise payable on an installment basis, the
first payment shall include a catch-up payment covering amounts that would otherwise have been paid during such period but for the application
of this provision, and the balance of the installments shall be payable in accordance with their original schedule.


 


(d)           Any
reimbursement provided hereunder shall be provided in accordance with the Company’s standard expense reimbursement procedures, but
in no event later than the end of the calendar year following the calendar year in which the applicable expense was incurred.


 


(e)           The
Company makes no representation or warranty and shall have no liability to the Participant or any other person if any provisions of this
Plan are determined to constitute deferred compensation subject to Section 409A of the Code but do not satisfy an exemption from,
or the conditions of, such Section.


 


9.             Limitation
on Payments. In the event that the severance and other benefits provided for under this Plan or otherwise payable to a Participant
(i) constitute “parachute payments” within the meaning of Section 280G of the Code, and (ii) but for this Section
9, would be subject to the excise tax imposed by Section 4999 of the Code, then the Participant’s benefits under this Plan will
be either:


 


(a)           delivered
in full, or


 


 


 






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(b)           delivered
as to such lesser extent which would result in no portion of such benefits being subject to excise tax under Section 4999 of the Code,
whichever of the foregoing amounts, taking into account the applicable federal, state and local income taxes and the excise tax imposed
by Section 4999, results in the receipt by the Participant on an after-tax basis of the greatest amount of benefits, notwithstanding that
all or some portion of such benefits may be taxable under Section 4999 of the Code. If a reduction in severance and other benefits constituting
“parachute payments” is necessary so that benefits are delivered to a lesser extent, reduction will occur in the following
order: (i) reduction of cash payments; (ii) cancellation of awards granted “contingent on a change in ownership or control”
(within the meaning of Section 280G of the Code); (iii) cancellation of accelerated vesting of Equity Awards; and (iv) reduction
of employee benefits. In the event that acceleration of vesting of Equity Award compensation is to be reduced, such acceleration of vesting
will be cancelled in the reverse order of the date of grant of the Participant’s Equity Awards.


 


Any determination required
under this Section 9 will be made in writing by the Company’s independent public accountants immediately prior
to a Change in Control, the Company’s legal advisors immediately prior to a Change in Control or such other person or entity to
which the parties mutually agree (the “Firm”), whose determination will be conclusive and binding upon the Participant
and the Company. For purposes of making the calculations required by this Section 9, the Firm may make reasonable assumptions
and approximations concerning applicable taxes and may rely on reasonable, good faith interpretations concerning the application of Sections
280G and 4999 of the Code. The Company and the Participant will furnish to the Firm such information and documents as the Firm may reasonably
request in order to make a determination under this Section 9. The Company will bear all costs the Firm may incur in connection
with any calculations contemplated by this Section 9.


 


10.           Notice
and Date of Termination. Any notices, requests, demands, and other communications provided for by this Plan shall be sufficient if
in writing and delivered in person or sent by registered or certified mail, postage prepaid, to a Participant at the last known address
as set forth in the Company’s records, or to the Company as follows:


 


Avid Bioservices, Inc.

14191 Myford Road

Tustin, CA 92780


Attention: Administrator


LegalDepartment@avidbio.com


 


11.           No
Mitigation; Indebtedness. The Participant is not required to seek other employment or to attempt in any way to reduce any amounts
payable to the Participant by the Company under this Plan. Subject to compliance with Section 409A of the Code and other applicable law,
if a Participant is indebted to the Company or any of its Affiliates as of his or her Separation Date, the Company and its Affiliates
reserve the right to offset any severance payments under the Plan by the amount of such indebtedness.


 


12.           No
Required Benefits Funding . When benefits are due pursuant to the Plan, they will be paid on an unfunded basis from the general
assets of the Company or the employing Affiliate. The Company is not required to establish a trust to fund the Plan. In all instances,
a Participant shall have no greater claim than a general unsecured creditor of the Company or, if employed by an Affiliate of the Company,
than of a general unsecured creditor of that employing Affiliate.


 


13.           Successors
and Assigns. This Plan shall inure to the benefit of and be binding upon the Company and the Participants, and, to the extent relevant,
their respective successors, executors, administrators, heirs and permitted assigns. In the event of a Participant’s death or Disability
after a Covered Termination but prior to the completion by the Company of all payments due to him or her under this Plan, the Company
shall continue such payments to the Participant’s beneficiary designated in writing to the Company prior to his or her death (or
to his or her estate, if the Participant fails to make such designation).


 


14.           Enforceability.
If any portion or provision of this Plan shall to any extent be declared illegal or unenforceable by a court of competent jurisdiction,
then the remainder of this Plan, or the application of such portion or provision in circumstances other than those as to which it is so
declared illegal or unenforceable, shall not be affected thereby, and each portion and provision of this Plan shall be valid and enforceable
to the fullest extent permitted by law.


 


 


 






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15.           Waiver.
No waiver of any provision hereof shall be effective unless made in writing and signed by the waiving party. The failure of any party
to require the performance of any term or obligation of this Plan, or the waiver by any party of any breach of this Plan, shall not prevent
any subsequent enforcement of such term or obligation or be deemed a waiver of any subsequent breach.


 


16.           Non-Duplication
of Benefits and Effect on Other Plans. If a Participant is covered by any other severance or separation pay plan, policy or practice
of the Company or has executed an individually negotiated employment contract or agreement with the Company relating to severance benefits
(collectively, an “Other Severance Arrangement”), in either case with respect to severance benefits payable
upon an event that constitutes a Covered Termination (used herein as defined herein), then within seven (7) days following the occurrence
of an event constituting a Covered Termination, such Participant shall provide written notice to the Administrator whether he or she elects,
to the extent permitted by Section 409A, to receive the benefits under this Plan or the Other Severance Arrangement. Failure to deliver
such notice shall be deemed an election by such Participant to receive the benefits under this Plan. Notwithstanding any other provision
in the Plan to the contrary, if the Participant is entitled to any cash severance and/or continued health benefits outside of the Plan
by operation of applicable law, his or her benefits under the Plan correspondingly will be reduced by the cash severance and/or continued
health benefits that the Participant receives by operation of applicable law., in all cases as administered by the Administrator; provided,
however, that the Participant shall receive at least 10 days’ written notice of any proposed offset (except that offsets set
forth in Section 6(d) shall not require any prior notice).


 


17.           No
Contract of Employment. Nothing in this Plan shall be construed as giving any Participant any right to be retained in the employ of
the Company or any of its Affiliates or shall affect the terms and conditions of a Participant’s employment with the Company or
any of its Affiliates.


 


18.           Amendment
or Termination of Plan. The Company may amend or terminate this Plan at any time or from time to time, but no such action shall adversely
affect the rights of any Participant without the Participant’s written consent (which the Participant may withhold for any or no
reason). This provision shall survive any purported amendment or termination of the Plan which would adversely affect the rights of the
Participant and to which the Participant has not consented.


 


19.           Governing
Law. To the extent not governed by U.S. federal law, this Plan shall be construed under and be governed in all respects by the laws
of the State of Delaware, without giving effect to the conflict of laws principles.


 


20.           Obligations
of Successors. In addition to any obligations imposed by law or contract upon any successor to the Company, any successor (whether
direct or indirect, by purchase, merger, consolidation or otherwise) shall expressly assume and agree to perform this Plan in the same
manner and to the same extent that the Company would be required to perform if no such succession had taken place.


 


21.           Effective
Date. This Plan shall become effective as of December 5, 2022.


 


22.           Other
Plan Information . This Plan is designed to be an “employee welfare benefit plan,” as defined in Section 3(1) of
ERISA. This Plan also is designed to be a “top hat” welfare benefit plan under Section 104(a)(3) of ERISA and, if ever considered
a “pension plan,” it shall be a top hat pension plan. If this Plan is ever determined to be a non-top hat “pension plan”
rather than a “welfare plan,” the Plan shall retroactively terminate as of its adoption and no individual shall have any rights
with respect to the Plan.


 


(a)           The
Employer Identification Number assigned to the Company (which is the “Plan Sponsor” as that term is used in ERISA) by the
Internal Revenue Service is 95-3698422. The Plan Number assigned to the Plan by the Plan Sponsor pursuant to the instructions of the Internal
Revenue Service is 510.


 


(b)           The
Plan year is the fiscal year.


 


(c)           The
agent for the service of legal process with respect to the Plan is the General Counsel, c/o Avid Bioservices, Inc., 14191 Myford Road,
Tustin, CA 92780. The service of legal process may also be made on the Plan by serving the Plan Administrator.


 


 


 






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(d)           The
“Plan Sponsor” of the Plan is Avid Bioservices, Inc. Each of the Plan Sponsor and the Administrator can be reached by contacting
the Company in writing 14191 Myford Road, Tustin, CA 92780, Attention: General Counsel and by telephone at (714) 508-6100. The Administrator
is the named fiduciary charged with the responsibility for administering the Plan; however, because the plan is a top-hat plan, it has
no fiduciary duties with respect to the Plan.


 


23.           ERISA
Rights . Participants in this Plan are entitled to certain rights and protections under ERISA if the participant is employed
in the United States. Participants in this Plan are entitled to:


 


(a)           Examine,
without charge, at the Administrator’s office and at other specified locations, such as work sites, all Plan documents and copies
of all documents filed by the Plan with the U.S. Department of Labor;


 


(b)           Obtain
copies of all Plan documents and Plan information upon written request to the Administrator. The Administrator may make a reasonable charge
for the copies; and


 


(c)           Receive
a summary of the Plan’s annual financial report, in the case of a plan which is required to file an annual financial report with
the Department of Labor.


 


(d)           In
addition to creating rights for Plan participants, ERISA imposes duties upon the people responsible for the operation of the employee
benefit plan. The people who operate the Plan, called “fiduciaries” of the Plan, have a duty to do so prudently and in the
interest of each Plan Participant and beneficiary.


 


No one, including the Company,
any employing Affiliate or any other person, may fire a Participant or otherwise discriminate against a Participant in any way to prevent
a Participant from obtaining a Plan benefit or exercising his or her rights under ERISA. If a Participant’s claim for a Plan benefit
is denied in whole or in part, the Participant must receive a written explanation of the reason for the denial. A Participant has the
right to have the Administrator review and reconsider the Participant’s claim.


 


Under ERISA, there are steps
a Participant can take to enforce the above rights. For instance, if a Participant requests materials from the Plan and does not receive
them within 30 days, the Participant may file suit in a U.S. federal court. In such a case, the court may require the Plan Administrator
to provide the materials and pay the Participant up to $110, as periodically adjusted, a day until the Participant receives the materials,
unless the materials were not sent because of reasons beyond the control of the Administrator. If a Participant has a claim for benefits
that is denied or ignored, in whole or in part, the Participant may file suit in a U.S. state or U.S. federal court. If it should happen
that the Plan fiduciaries misuse the Plan’s money, or if a Participant is discriminated against for asserting his or her rights,
the Participant may seek assistance from the U.S. Department of Labor, or the Participant may file suit in a U.S. federal court. The court
will decide who should pay court costs and legal fees. If the Participant is successful, the court may order the person that the Participant
has sued to pay these costs and fees. If the Participant loses, the court may order the Participant to pay these costs and fees, for example,
if it finds that the claim is frivolous.


 


If a Participant has any questions
about the Plan, the Participant should contact the Administrator. If a Participant has any questions, about his or her rights under ERISA,
the Participant should contact the nearest area office of the U.S. Employee Benefits Security Administration, U.S. Department of Labor,
listed in his or her telephone directory or the Division of Technical Assistance and Inquires, Employee Benefits Security Administration,
U.S. Department of Labor, 200 Constitution Avenue N.W., Washington, D.C. 20210. A Participant may also obtain certain publications about
his or her rights and responsibilities under ERISA by calling the publications hotline of the U.S. Employee Benefits Security Administration.


 


 


 






    	 	8	 



     


    

 


24.           Claims
Procedure . If a Participant or his or her beneficiary feels that he or she has not received the Plan benefits that he or she
is entitled to receive, the Participant must file a written claim with the Administrator within six months of the Participant’s
termination date. Any claim filed after such date will be untimely. The Administrator will review the claim and notify the Participant
of its decision in writing within 90 days after the Administrator receives the claim, unless the Administrator determines that special
circumstances require an extension of time for processing the claim. If the Administrator determines that an extension of time for processing
is required, written notice of the extension shall be furnished to the Participant prior to the termination of the initial 90-day period.
Any such extension may be for up to 90 days from the end of such initial period. The extension notice shall indicate the special circumstances
requiring an extension of time and the date by which the Plan representative expects to render the benefit determination.


 


If the Plan Administrator denies a claim, in
whole or in part, the Plan Administrator’s notice will set forth:


 


●    The
specific reason(s) for the denial;


 


●    The
Plan provision(s) on which the denial is based;


 


●    A
description of any material or information necessary for the Participant to perfect the claim, and an explanation of why such material
or information is necessary; and


 


●    A
description of the Plan’s claim review procedures and the time limits applicable to such procedures, including a statement of the
Participant’s right to bring a civil action under Section 502(a) of ERISA following an adverse benefit determination on review.


 


If a Participant or his or her beneficiary feels
the denial of the claim is improper, the Participant or his or her duly authorized representative must file a written request for a full
review of the claim. A request for review must be filed with the Plan Administrator within 60 days after the Participant receives the
notice of denial and should set forth all of the grounds upon which it is based, all facts in support of the request, and any other matters
the Participant or his or her representative deems pertinent. The Participant may submit any written comments, documents, records, and
other information relating to the claim for benefits that the Participant wishes. The Plan Administrator will give the Participant, or
his or her representative, upon request and free of charge, reasonable access to, and copies of, all documents, records, and other information
relevant to the Participant’s claim for benefits. Any such review shall take into account all comments, documents, records, and
other information submitted by the Participant relating to the claim, without regard to whether such information was submitted or considered
in the initial benefit determination.


 


The Plan Administrator will furnish the Participant
with a final written decision within 60 days after receipt of the request for review, unless the Plan Administrator determines that special
circumstances require an extension of time for processing the claim. If the Plan Administrator determines that an extension of time for
processing is required, written notice of the extension shall be furnished to the Participant prior to the termination of the initial
60-day period. Any such extension may be for up to 60 days from the end of the initial period. The extension notice shall indicate the
special circumstances requiring an extension of time and the date by which the plan expects to render the determination on review.


 


If the Plan Administrator denies a claim on
review, in whole or in part, the Plan Administrator’s notice will set forth:


 


●    The
specific reason(s) for the denial;


 


●    The
Plan provision(s) on which the denial is based;


 


●    A
statement that the Participant is are entitled to receive, upon request and free of charge, reasonable access to, and copies of, all documents,
records, and other information relevant to the Participant’s claim for benefits; and


 


●    A
statement of the Participant’s right to bring a civil action under Section 502(a) of ERISA.


 


 


 






    	 	9	 



     


    

 


If the claim is denied on review and the Participant
wishes to file a lawsuit, the Participant must do so within six months of the date the claim was denied on review. Any lawsuit filed after
such date will be untimely. In any event, the Participant must timely exhaust the Plan’s claims procedures set forth above before
filing a lawsuit to recover Plan benefits. Notwithstanding anything to the contrary, claims and appeals shall be handled in accordance
with the United States Department of Labor’s claims procedure regulations, currently set forth in Sections 2560.503-1 et seq.
of Title 29 of the Code of Federal Regulations, which are incorporated by reference.


 





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    	 	10	 



     


    

 


EXHIBIT A


 





Severance Period:


 


CEO Participant: 12 months


 


Other C-Level Officer Participants: 12 months


 


Vice President Officer Participants: 6 months


 


 


 


CIC Severance Period:


 


CEO Participant: 24 months


 


Other C-Level Officer Participants: 24 months


 


Vice President Officer Participants: 12 months


 


 


 


 


 


 


 


 


 


 


 






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