SEC Filing | AeroVironment, Inc.

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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )

Filed by the Registrant ☒

Filed by a Party other than the Registrant ☐

Check the appropriate box:

☒

Preliminary Proxy Statement

☐

Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))

☐

Definitive Proxy Statement

☐

Definitive Additional Materials

☐

Soliciting Material Pursuant to §240.14a-12

AEROVIRONMENT, INC.

(Name of Registrant as Specified in Its Charter)

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

☒

No Fee Required.

☐

Fee paid with preliminary materials.

☐

Fee computed on table in exhibit required by Item 25(b) per Exchange Act Rules 14a-6(i)(1) and 0-11.

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[MISSING IMAGE: lg_aerovironment-bw.jpg]

PRELIMINARY PROXY STATEMENT — SUBJECT TO COMPLETION

Notice of 2024 Annual Meeting
of Stockholders
and Proxy Statement

Friday, September 27, 2024
at 12:00 p.m. Eastern Daylight Time

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	MESSAGE AND Q&A WITH OUR CHAIRMAN, PRESIDENT AND CHIEF EXECUTIVE OFFICER
	NOTICE OF ANNUAL MEETING OF STOCKHOLDERS					1
	PROXY SUMMARY					5

	Proposal 1 — Election of Nominees to the Board of Directors					10
	Director Qualifications and Independence					12
	2024 Nominees for Class III Directors					14
	Summary of Director Nominees					24
	Corporate Governance					26
	Director Compensation					34
	Related Party Transactions					38
	Executive Officers					39
	SHARE OWNERSHIP					41
	Ownership of Equity Securities of the Company					41
	Delinquent Section 16(a) Reports					43
	Equity Compensation Plan Information					43
	EXECUTIVE COMPENSATION AND OTHER INFORMATION					44
	Compensation Committee Report					44
	Compensation Discussion and Analysis					44
	Executive Compensation Tables					59
	Pay Versus Performance					69

	AUDIT MATTERS					73
	Audit Committee Report					73
	Proposal 2 — Ratification of Selection of Deloitte & Touche LLP as Our Independent Registered Public Accounting Firm					74
	Proposal 3 — Non-Binding Advisory Vote on the Compensation of our Named Executive Officers					76
	Proposal 4 — Management Proposal To Amend The Company’s Amended And Restated Certificate Of Incorporation To Declassify the Board and Provide For Annual Election Of All Directors					78
	Proposal 5 — Management Proposal To Amend The Company’s Amended And Restated Certificate Of Incorporation To Provide For Officer Exculpation					80
	QUESTIONS AND ANSWERS ABOUT ANNUAL MEETING AND VOTING					82

	Note About Forward-Looking Statements
	Certain statements in this Proxy Statement may constitute “forward-looking statements” as that term is defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements include, without limitation, any statement that may predict, forecast, indicate or imply future results, performance or achievements, and may contain words such as “believe,” “anticipate,” “expect,” “estimate,” “intend,” “project,” “plan,” or words or phrases with similar meaning. These statements are made on the basis of current expectations, forecasts and assumptions that involve risks and uncertainties, including, but not limited to, economic, competitive, governmental and technological factors outside of our control, that may cause our business, strategy or actual results to differ materially from those expressed or implied. Factors that could cause actual results to differ materially from the forward-looking statements include, but are not limited to, the impact of our ability to successfully close and integrate acquisitions into our operations and avoid disruptions from acquisition transactions that will harm our business; the recording of goodwill and other intangible assets as part of acquisitions that are subject to potential impairments in the future and any realization of such impairments; any actual or threatened disruptions to our relationships with our distributors, suppliers, customers

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and employees, including shortages in components for our products; the ability to timely and sufficiently integrate international operations into our ongoing business and compliance programs; reliance on sales to the U.S. government, including uncertainties in classification, pricing or potentially burdensome imposed terms for certain types of government contracts; availability of U.S. government funding for defense procurement and R&D programs; our ability to win U.S. and international government R&D and procurement programs; changes in the timing and/or amount of government spending, including due to continuing resolutions; adverse impacts of a U.S. government shutdown; our reliance on limited relationships to fund our development of HAPS UAS; our ability to execute contracts for anticipated sales, perform under such contracts and other existing contracts and obtain new contracts; risks related to our international business, including compliance with export control laws; the extensive and increasing regulatory requirements governing our contracts with the U.S. government and international customers; the consequences to our financial position, business and reputation that could result from failing to comply with such regulatory requirements; unexpected technical and marketing difficulties inherent in major research and product development efforts; the impact of potential security and cyber threats or the risk of unauthorized access to and resulting misuse of our, our customers’ and/or our suppliers’ information and systems; failure to remain a market innovator, to create new market opportunities or to expand into new markets; our ability to increase production capacity to support anticipated growth; unexpected changes in significant operating expenses, including components and raw materials; failure to develop new products or integrate new technology into current products; any increase in litigation activity or unfavorable results in legal proceedings, including pending class actions; our ability to respond and adapt to legal, regulatory and government budgetary changes, including those resulting from the impact of pandemics and similar outbreaks; our ability to comply with the covenants in our loan documents; our ability to attract and retain skilled employees; the impact of inflation; and general economic and business conditions in the United States and elsewhere in the world; and the failure to establish and maintain effective internal control over financial reporting. For a further list and description of such risks and uncertainties, see the reports we file with the Securities and Exchange Commission, including our Form 10-K for the fiscal year ended April 30, 2024 made available with this Proxy Statement. We do not intend, and undertake no obligation, to update any forward-looking statements, whether as a result of new information, future events or otherwise.

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MESSAGE AND Q&A WITH AEROVIRONMENT CHAIRMAN, PRESIDENT, AND CHIEF EXECUTIVE OFFICER WAHID NAWABI

Another record year in the books!

Fiscal year 2024 marked another successful year of strong results for AeroVironment’s (AV) stakeholders, as we exceeded our goal of growing the company’s revenue while delivering solid bottom-line results. As awareness and demand for our battle-proven solutions increased, we successfully met the needs of our customers around the world, enabling them to perform their vital missions.

Our team is proud of the work we accomplished this year, further defining AV as a proven leader in autonomous vehicles and demonstrating why we are best positioned for sustained growth in this market. This past year was pivotal for AV as global demand continued to surge for autonomous systems. We responded by investing across the organization to strengthen our team, expand our manufacturing capacity, and enhance our solution offerings to meet the evolving needs of our customers. These investments, along with our core strengths in innovation, capacity and experience, helped fortify our position as a market leader in the defense tech sector.

These remarkable achievements would not have been possible without the unwavering determination and perseverance of our team. I extend my deepest gratitude to each employee for their dedication to our company and to our customers’ vital missions. Their passion, combined with the steadfast support of our investors and the trust of our customers, assures me that this momentum will not only continue but accelerate into fiscal year 2025 and beyond. We remain committed to supporting those on the front lines who preserve our nation’s security, ensuring they have the innovative and reliable solutions they need.

What do you forecast to be the key growth drivers for the Company?

A) Similar to our results in fiscal year 2024, we anticipate much of the Company’s growth will be driven by our Loitering Munition Systems (LMS) and Uncrewed Systems (UxS) segments. As the demand arising from the war in Ukraine has proven, our products represent a key solution for customers to address their vital missions.

Given the emergence of new geopolitical threats, we anticipate demand for these products to increase worldwide. We expect our LMS segment in fiscal year 2025 to experience its highest rate of annual revenue growth in Company history as demand for both the Switchblade 300 and 600 continues to intensify. This heightened demand was most recently evidenced by several U.S. DoD contract awards for Switchblade products, including the U.S. Army’s selection of Switchblade 600 for their first procurement under the Low Altitude Stalking and Strike Ordnance (LASSO) program. The Switchblade 600 was subsequently selected to participate in Tranche 1 of the first iteration of the U.S. DoD’s Replicator initiative, while our Switchblade 300 was selected by the U.S. Marine Corps for their first tranche of their Organic Precision Fire-Light (OPF-L) program of record. In addition to these recent announcements, Switchblade was also announced for the recent Ukraine Security Assistance Initiative (USAI). These key wins further validate the effectiveness of our solutions in active conflicts around the globe.

In addition to increased demand for our loitering munition products, we are also anticipating increased top-line growth from our UxS segment. Our Puma and JUMP 20 systems continue to be vital products to our domestic and international customers and are delivering solid revenue growth year over year, which we anticipate will continue. Puma continues to lead the small UAS market as the dominant ISR workhorse in current conflicts, providing much needed reconnaissance and surveillance.

AV is also developing an entirely new Group 2 UAS capable of vertical take-off and landing, the P550. It combines maximum payload versatility with advanced AI, autonomy and target capabilities, especially in contested environments.

What steps are you taking to ensure you can meet increased demand in the coming months and years?

A) We have the utmost confidence in our ability to continue manufacturing at scale to meet growing demand. We’ve seen the pipeline for our battle-proven products increase over the past few years and have prudently

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invested across the organization to strengthen our team, expand our manufacturing capacity, and upgrade our products. Our factories are currently meeting demand and have additional capacity to accommodate potential new orders.

Separately, we are expanding capacity for our Switchblades to produce up to $500 million in annual revenue by the end of fiscal year 2025, and up to $1 billion in annual revenue by fiscal year end 2027.

We’re pushing ourselves to innovate every day to remain best in class for our customers and prepare for future programs of record, and our uncrewed system product lines continue to be in high demand around the globe. We anticipate strong domestic and international demand for both Puma and JUMP 20 in fiscal year 2025 and expect uncrewed system product lines to have enough capacity to deliver $1 billion in annual product revenues by the end of fiscal year 2025.

Do you see any major risk to your revenue forecast with a change in White House Administrations?

A) We have been in business since 1971 and have worked well with the current administration and others before it, so we do not foresee any major risks to our revenue forecasts with a change in White House administration. We are proud of the leading position we have established and maintained over the years and continue to believe that AeroVironment is the best positioned defense tech firm to meet customers’ needs. AV’s products and solutions benefit from bipartisan support as evidenced by continued growth following the White House transition four years ago. Since then, demand for our uncrewed systems also increased globally with more than 50% of our sales coming from international opportunities. With an increase in emerging global threats, the international need for our unmatched products is stronger than ever. We feel confident that those on both sides of the aisle understand the importance of our products and how crucial they are to customers not only in the U.S., but around the world.

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AEROVIRONMENT, INC.

NOTICE OF 2024 ANNUAL MEETING OF STOCKHOLDERS

Dear Stockholders,

We are pleased to invite you to join the board of directors and executive team of AeroVironment, Inc. (the “company”) at our 2024 annual meeting of stockholders (the “annual meeting”). We have chosen to hold this year’s annual meeting in a virtual meeting format. Stockholders will be able to attend and listen to the 2024 annual meeting live, submit questions to the board of directors and management, and vote their shares electronically, from virtually any location with internet connectivity.

Important information relating to the annual meeting is detailed below:

	TIME:			12:00 p.m. Eastern Daylight Time on Friday, September 27, 2024
	PLACE:			Online at: https://web.lumiconnect.com/216888245

		Unanimous Recommendations of Board of Directors
ITEMS OF BUSINESS:	(1) Elect Wahid Nawabi, Cindy Lewis and Joseph L. Votel, each to serve as a Class III director for a three-year term;	FOR
	(2) Ratify the selection of Deloitte & Touche LLP as our independent registered public accounting firm for the fiscal year ending April 30, 2025;	FOR
	(3) Conduct a non-binding advisory vote on the compensation of our Named Executive Officers;	FOR
	(4) Management proposal to amend the company’s amended and restated certificate of incorporation to provide for annual election of all directors;	FOR
	(5) Management proposal to amend the company’s amended and restated certificate of incorporation to provide for officer exculpation; and	FOR
	(6) Transact such other business as may properly come before the annual meeting or any adjournments or postponements thereof.
RECORD DATE:	You are entitled to vote if you were a stockholder of the company at the close of business on August [•], 2024 (the “Record Date”).

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	MEETING PARTICIPATION AND ATTENDANCE:			You may participate in the annual meeting, including submitting questions, if you were a stockholder as of the Record Date or you hold a valid proxy for the meeting. This year’s annual meeting will be conducted in a virtual only format on the internet. Stockholders (or their proxies) can participate in and vote at the annual meeting by logging in with your 11-digit voter control number issued by Equiniti Trust Company, LLC (“EQ,” and formerly American Stock Transfer & Trust Company LLC) and password of AVAV2024 (case sensitive). Online access to the virtual stockholder meeting will open up approximately 60 minutes prior to the start of the annual meeting to allow for you to test your computer audio system.
				You can ask questions once you log in or when the meeting begins by clicking on the “ask a question” icon on the top of your screen.
				Beneficial Stockholders. If your shares are held in the name of a broker, bank or other holder of record, you should receive a proxy card and voting instructions with these proxy materials. To participate, including submitting questions, and vote at the virtual annual meeting, you must first obtain a valid legal proxy from your broker, bank or other agent and then register in advance to attend the annual meeting. Follow the instructions from your broker or bank included with these proxy materials or contact your broker or bank to request a legal proxy form.
				After obtaining a valid legal proxy from your broker, bank or other agent, to then register to attend the annual meeting, you must submit proof of your legal proxy reflecting the number of your shares along with your name and email address to EQ. Requests for registration should be directed to proxy@equiniti.com or to facsimile number 718-765-8730. Written requests can be mailed to:
				Equiniti Trust Company, LLC Attn: Proxy Tabulation Department PO Box 500 Newark, NJ 07101
				Requests for registration must be labelled as “Legal Proxy” and be received no later than 5:00 p.m., Eastern Daylight Time, on September 17, 2024. You will receive a confirmation of your registration by email after we receive your registration materials.
	VOTING BY PROXY:			Registered Stockholders. To ensure that your vote is recorded promptly, please vote as soon as possible, even if you plan to attend the annual meeting virtually. Instructions for voting are on your proxy card. If you attend the annual meeting, you may also submit your vote during the virtual meeting, and any previous votes you submitted will be superseded by the vote that you cast at the annual meeting.
				You are urged to date, sign and promptly return the proxy card in the envelope provided to you, or to use the telephone or internet method of voting described on your proxy card, so that if you are unable to attend the meeting your shares can be voted.
				Beneficial Stockholders. If your shares are held in the name of a broker, bank or other holder of record, follow the voting instructions you receive from the holder of record to vote your shares. Without your instructions as to how to vote, brokers are not permitted to vote your shares at the annual meeting with respect to the election of directors, the non-binding advisory vote to approve the compensation of our named executive officers, or either of the management proposals to amend the company’s amended and restated certificate of incorporation. Please instruct your broker how to vote your shares using the voting instructions provided by your broker.

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				This proxy statement is issued in connection with the solicitation of a proxy on the enclosed form by the board of directors of AeroVironment, Inc. for use at our 2024 annual meeting of stockholders. We will begin mailing this proxy statement, a form of proxy and our 2024 annual report on or about August [•], 2024.
				Thank you for your support.

Wahid Nawabi
President, Chief Executive Officer and
Chair of the Board

Arlington, Virginia
August [•], 2024

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IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE ANNUAL MEETING OF STOCKHOLDERS TO BE HELD ON SEPTEMBER 27, 2024

YOUR VOTE IS EXTREMELY IMPORTANT

IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE
ANNUAL MEETING OF STOCKHOLDERS TO BE HELD ON SEPTEMBER 27, 2024

This notice, the accompanying proxy statement, and our 2024 annual report to stockholders,
are available on our website at
http://investor.avinc.com/financial-information/financial-filings-and-releases.

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PROXY SUMMARY

This proxy statement is furnished to our stockholders in connection with the solicitation of proxies by the board of directors (the “board” or “board of directors”) of AeroVironment, Inc. (the “company”) for our 2024 annual meeting of stockholders (the “annual meeting”) to be held on Friday, September 27, 2024, and any adjournments or postponements thereof, for the purposes set forth in the attached notice of annual meeting. Our principal executive offices are located at 241 18th Street South, Suite 650, Arlington, VA 22202. Enclosed with this proxy statement is a copy of our 2024 annual report for the fiscal year ended April 30, 2024. However, the 2024 annual report is not intended to be a part of, and shall not be deemed to be incorporated by reference into, this proxy statement or a solicitation of proxies.

This summary highlights information contained elsewhere in this proxy statement. This summary does not contain all the information that you should consider, and you should read the entire proxy statement before voting. For more complete information regarding the company’s 2024 performance, please review our annual report on Form 10-K for the fiscal year ended April 30, 2024. This proxy statement and the accompanying proxy card are first being mailed to stockholders on or about August [•], 2024.

VOTING AND MEETING INFORMATION

It is important that you vote in order to impact the future of the company. Please carefully review the proxy materials for the annual meeting, which will be held on Friday, September 27, 2024, at 12:00 p.m., Eastern Daylight Time, online at https://web.lumiconnect.com/216888245, and follow the instructions below to cast your vote on all of the voting matters.

Who is Eligible to Vote

You are entitled to vote at the annual meeting if you were a stockholder of record at the close of business on August [•], 2024, which we refer to as the “Record Date” of the annual meeting. On the Record Date, there were [•] shares of common stock issued and outstanding and entitled to vote at the annual meeting. The holders of our common stock are entitled to one vote per share on any proposal presented at the annual meeting. We have no other voting securities outstanding.

Voting in Advance of the Meeting

Even if you plan to attend the annual meeting, please vote right away using one of the following advance voting methods (see page 84 for additional details). Make sure to have your proxy card or voting instruction form in hand and follow the instructions.

You can vote in advance of the meeting in one of three ways:

				Visit the website listed on your proxy card/voting instruction form to vote BY INTERNET
				Call the telephone number on your proxy card/voting instruction form to vote BY TELEPHONE
				Sign, date and return your proxy card/voting instruction form in the enclosed envelope to vote BY MAIL

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PROXY SUMMARY

Attending and Voting at the Annual Meeting

All stockholders of record may vote virtually at the annual meeting. Beneficial owners may vote virtually at the meeting if they have a legal proxy, as described on page 83.

Important Note about Meeting Admission Requirements: If you plan to attend the meeting virtually, you should review the important details on admission requirements on page 83.

Electronic Document Delivery

Instead of receiving future copies of our notice of annual meeting, proxy statement and the annual report by mail, stockholders of record and most beneficial owners can elect to receive an email that will provide electronic links to these documents. Opting to receive our proxy materials online will save on the cost of producing and mailing documents and significantly reduce paper waste and will also provide an electronic link to quickly and efficiently access the proxy voting site. Please see your proxy card for the website to which you are referred to vote your shares for instructions on how to elect to receive your future proxy materials electronically.

Roadmap of Voting Matters

Stockholders are being asked to vote on the following matters at the 2024 annual meeting of stockholders:

						Our Board’s Recommendation
		Proposal 1. Election of Directors (page 8) The board believes that the combination of qualifications, skills and experiences of Wahid Nawabi, Cindy Lewis, and Joseph L. Votel contribute to an effective and well-functioning board and their continued service as directors would be in the best interests of the company and its stockholders. Mr. Nawabi, Ms. Lewis, and Mr. Votel each possesses the necessary qualifications to assist the board in providing effective oversight of the business and strategic advice and counsel to the company’s management.				FOR each Director Nominee
		Proposal 2. Ratification of the Appointment of Deloitte & Touche LLP as Our Independent Registered Public Accounting Firm (page 74) The audit committee of the board (the “Audit Committee”) has appointed Deloitte & Touche LLP to serve as the company’s independent registered public accounting firm for the fiscal year ending April 30, 2025. The Audit Committee and the board believe that the appointment of Deloitte & Touche LLP to serve as the company’s independent registered public accounting firm is in the best interests of the company and its stockholders. As a matter of good corporate governance, stockholders are being asked to ratify the Audit Committee’s selection of our independent registered public accounting firm.				FOR
		Proposal 3. Non-Binding Advisory Vote on the Compensation of Our Named Executive Officers (page 76) The company believes that our compensation programs are designed to attract, incentivize and reward our leadership for increasing stockholder value and align the interests of leadership with those of our stockholders on an annual and long-term basis. The company seeks a non-binding advisory vote from its stockholders to approve the compensation of our Named Executive Officers, as described in the Compensation Discussion and Analysis section beginning on page 44 and the Compensation Tables section beginning on page 59. The board values stockholder opinions and the compensation committee of the board (the “Compensation Committee”) will consider the outcome of the advisory vote when considering future executive compensation decisions.				FOR

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PROXY SUMMARY

						Our Board’s Recommendation
		Proposal 4. Management Proposal to Amend the Company’s Amended and Restated Certificate of Incorporation to Provide for Annual Election of All Directors (78) Our Amended and Restated Certificate of Incorporation (the “Charter”) provides that our board of directors shall be divided into three classes as nearly equal in number as possible with members of each class being elected for three-year terms annually. The board, upon the recommendation of the Nominating and Corporate Governance Committee, and in consideration of the approval of stockholder proposal to declassify the board at the 2023 annual meeting, has determined it advisable and in the best interests of the company and our stockholders to amend and restate our Charter to eliminate the board’s classified structure and provide the company’s stockholders with an opportunity to elect all directors on an annual basis.				FOR
		Proposal 5. Management Proposal to Amend the Company’s Amended and Restated Certificate of Incorporation to Provide for Officer Exculpation (page 80) Our Charter limits the monetary liability of our directors in certain circumstances pursuant to, and consistent with, the Delaware General Corporation Law (“DGCL”). Effective August 1, 2022, Section 102(b)(7) of the DGCL was amended to permit a corporation to include within its certificate of incorporation a provision eliminating or limiting monetary liability for certain corporate officers for a breach of the duty of care in certain circumstances. The board has unanimously approved and deemed that it is advisable and in the best interests of the company to amend our Charter extend exculpation protection to our officers in addition to our directors as permitted by DGCL Section 102(b)(7). The board is asking our stockholders to approve the proposed Charter amendment.				FOR

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PROXY SUMMARY

QUESTIONS AND ANSWERS (PAGE 82)

Please see the Questions and Answers section beginning on page 82 for important information about the proxy materials, voting, the annual meeting, company documents, communications and the deadlines to submit stockholder proposals for the 2025 annual meeting of stockholders. Additional questions may be directed to Investor Relations at (805) 520-8350 x4278 or https://investor.avinc.com/contact-and-faq/contact-us.

CORPORATE GOVERNANCE (PAGE 26)

The company is committed to good corporate governance, which promotes the long-term interests of stockholders, strengthens board and management accountability and helps build public trust in the company. Highlights of our governance practices include:

•

Highly qualified and engaged board of directors, with relevant expertise for overseeing our strategy, capital allocation, performance, succession planning and risk

•

High proportion of independent directors (7 of 8)

•

Independent Audit, Compensation, Nominating and Corporate Governance and Cybersecurity Committees

•

Board comprised of directors with key skills, attributes and experiences linked to the company’s needs and business priorities

•

Limitation to four public companies on which directors can serve without receiving prior approval of the Chair of the Nominating and Corporate Governance Committee;

•

Disclosed “skills matrix” for the board

•

Regular board and committee self-evaluations

•

Majority vote standard for election of directors in uncontested elections

•

Lead Independent Director

•

Regular reviews for board refreshment

•

Active stockholder engagement

•

Anti-hedging, anti-pledging, and anti-short sale policies for all executives, directors and employees

•

Executive compensation driven by pay-for-performance philosophy

•

Annual Say-on-Pay advisory vote on executive compensation

•

Share ownership guidelines and share retention policy for executives and directors

•

Compensation recovery (clawback) policy for executives

•

Stockholders “proxy access” right to nominate director candidates and have those nominees included in our proxy statement, subject to meeting the requirements in our Bylaws

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PROXY SUMMARY

DIRECTOR NOMINEES AND OTHER DIRECTORS (PAGES 14 — 23)

Name	Age	Director Since	Primary Experience	Committee Membership	# of Other Public Company Boards
Director Nominees
Wahid Nawabi	55	2016	President and Chief Executive Officer of the company since May 2016; former Chief Operating Officer and Senior Vice President of the company and General Manager of the company’s former Efficient Energy Systems (“EES”) division	E	0
Cindy K. Lewis*1	66	2021	Chairperson for AirBorn Consolidated Holdings, Inc. Former President and Chief Executive Officer of AirBorn Consolidated Holdings, Inc.	A, NGC, CS	0
Joseph L. Votel*	66	2023	Retired four-star Army general, former commander of United States Central Command, current Strategic Advisor for Sierra Nevada Corporation and director of four private companies	—	0
Other Directors
Charles Thomas Burbage*	76	2013	Former Executive Vice President and General Manager, Joint Strike Fighter Program of Lockheed Martin	C, NCG, E	0
Stephen F. Page*	84	2013	Former Chief Financial Officer of United Technologies Corporation and Chief Executive Officer of its Otis Elevator division and former director of public companies	A, NCG	0
Edward R. Muller*	72	2013	Former Chairman and Chief Executive Officer of GenOn Energy Inc. and former director of public companies	A, C, E, L	0
Philip S. Davidson*	64	2023	Retired Navy Admiral, founder of Davidson Strategies, LLC and current director of two other public companies	A, CS	2
Mary Beth Long*	60	2023	Former United States Assistant Secretary of Defense for International Security Affairs	C, CS	0

* = Independent Director

L = Lead Independent Director

A = Audit Committee

C = Compensation Committee

CS = Cybersecurity Committee

E = Executive Committee

NCG = Nominating and Corporate Governance Committee

If re-elected, the nominee will Chair the Cybersecurity Committee and serve on the Audit Committee and Nominating and Corporate Governance Committee.

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PROPOSAL 1. ELECTION OF NOMINEES TO THE BOARD OF DIRECTORS

Our board of directors currently consists of eight members and is divided into three classes of directors serving staggered three-year terms. Directors for each class are elected at the annual meeting of stockholders held in the year in which the term for their class expires and hold office until their resignation or removal or their successors are duly elected and qualified. In accordance with our certificate of incorporation and our bylaws, our board of directors may fill existing vacancies on the board of directors by appointment.

The term of office of the Class III directors, which include Wahid Nawabi, Cindy K. Lewis and Joseph L. Votel, will expire at the beginning of the annual meeting.

At the recommendation of the Nominating and Corporate Governance Committee, our board of directors proposes the election of Wahid Nawabi, Cindy K. Lewis and Joseph L. Votel as Class III directors. Mr. Nawabi, Ms. Lewis and Mr. Votel are incumbent directors.

Each of Mr. Nawabi, Ms. Lewis and Mr. Votel has indicated his or her willingness to serve if elected. If any of Mr. Nawabi, Ms. Lewis or Mr. Votel becomes unable to serve or for good cause will not serve, the individuals named as proxies on the enclosed proxy card will vote the shares that they represent for the election of such other persons as the board may recommend, unless the board reduces the number of directors. There are currently two Class I directors, whose terms expire at

the annual meeting of stockholders in 2025, and three Class II directors, whose terms expire at the annual meeting of stockholders in 2026.

Unless otherwise instructed, the proxy holders will vote the proxies received by them for the nominees named herein. If voting instructions are received, the proxy holders will vote the proxy cards received by them in accordance with the instructions received. In no event may the proxy holders vote for the election of more than three nominees. We have no reason to believe that the nominees will be unable or unwilling to serve if elected as directors.

The principal occupation and certain other information about the nominees, our other directors and our executive officers are set forth on the following pages.

THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT YOU VOTE “FOR” THE ELECTION OF THE THREE BOARD NOMINEES LISTED ABOVE.

Abstentions will be counted as present for the purposes of this vote but are not counted as votes cast and therefore will have no effect on the election of directors. Broker non-votes will not be counted as present, are not entitled to vote on this proposal and will have no effect on the election of directors.

Election Process and Voting Standard

There are no limits on the number of terms a director may serve. We believe term limits may cause the loss of experience and expertise important to the effective operation of our board of directors. However, to ensure that the board remains composed of high-functioning members able to keep their commitments to board service, the Nominating and Corporate Governance Committee evaluates the qualifications and considers the performance of each incumbent director before recommending the nomination of that director for an additional term. The Class III directors will be elected on a majority vote standard basis, meaning that each of the three nominees must receive a vote of a majority of the total votes cast with respect to such nominee’s election (i.e. the number of votes cast “for” a nominee’s election exceeds the number of votes cast “against”

that nominee’s election) to be elected as a director. Our Corporate Governance Guidelines require following any stockholder meeting at which directors are subject to an uncontested election, any incumbent director who fails to receive a majority of votes cast at the meeting to submit, promptly after the final certification of the election results, a letter of resignation to the board of directors for consideration by the Nominating and Corporate Governance Committee of the board. The Nominating and Corporate Governance Committee shall consider the offer of resignation and recommend to the board of directors whether to accept or reject the resignation, or whether other action should be taken. The board of directors shall act on the Nominating and Corporate Governance Committee’s recommendation within one hundred (100) days

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PROPOSAL 1. ELECTION OF NOMINEES TO THE BOARD OF DIRECTORS

following the final certification of the election results and publicly disclose its decision, and the reasons for such decision if such offer of resignation is rejected.

In addition, pursuant to our Corporate Governance Guidelines, a director whose job responsibilities materially change since his or her last election as a

director may be asked to submit a letter of resignation to the board. The board may request such a resignation letter if continuing service on the board by the individual is not consistent with the criteria deemed necessary for continuing service on the board.

Director Nominations

The Nominating and Corporate Governance Committee is responsible for identifying and evaluating nominees for director and for recommending to the board a slate of nominees for the class of directors to be elected at each annual meeting of stockholders. Nominees may be suggested by directors, members of management or stockholders.

Stockholders who would like the Nominating and Corporate Governance Committee to consider their

recommendations for nominees to the board of directors should submit their recommendations in writing by mail to the Nominating and Corporate Governance Committee in care of the Office of the Corporate Secretary, AeroVironment, Inc., 241 18TH Street South, Suite 650, Arlington, VA 22202 or by email to corporatesecretary@avinc.com. Recommendations by stockholders that are made in accordance with these procedures will receive the same consideration as other nominees.

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DIRECTOR QUALIFICATIONS AND INDEPENDENCE

DIRECTOR QUALIFICATIONS AND
INDEPENDENCE

Directors are responsible for overseeing the company’s business consistent with their fiduciary duties to stockholders. This significant responsibility requires highly skilled individuals with diverse qualities, attributes and professional experience. The board believes that there are general requirements that are applicable to all directors and other skills and experience that only need

to be represented on the board as a whole, but not necessarily possessed by each director. The board and the Nominating and Corporate Governance Committee carefully consider the qualifications of directors and director candidates individually and in the broader context of the board’s overall composition and the company’s current and future needs.

Qualifications Required of Directors

In its assessment of each potential director nominee, the Nominating and Corporate Governance Committee considers the nominee’s judgment, integrity, experience, independence, understanding of the company’s business or related industries and such other factors as the Nominating and Corporate Governance Committee determines are pertinent in light of the current needs of the board. The Nominating and Corporate Governance Committee also takes into account the ability of a potential nominee to devote the time and effort necessary to fulfill the responsibilities of a director to the company. The board and the Nominating and Corporate Governance Committee require that each director nominee be a person of high integrity, ethics and values, have a proven record of success and demonstrate respect for sound corporate governance requirements and practices. Each director nominee must also possess practical and mature business judgment, as well as demonstrate innovative thinking and an entrepreneurial spirit — all qualities that the board believes are essential to its ability to maintain the company’s culture of innovation. In addition, the board conducts interviews of potential director candidates to assess intangible qualities, including the individual’s ability to ask difficult questions while maintaining collegiality.

Specific Qualifications, Attributes, Skills and Experience to Be Represented on the Board

The board has identified the following qualifications, attributes, skills and experience listed in the bullets below as important for the board to possess as a whole, in light of the company’s current needs and business priorities:

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personal and professional integrity, ethics and values;

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experience in corporate management, such as serving as an officer or former officer of a publicly held company;

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understanding of the company’s business;

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experience in the aerospace and defense industry; understanding of the Company’s business;

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experience as a board member of another publicly held company;

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diversity of expertise and experience in substantive matters pertaining to the Company’s business relative to other board members;

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educational background;

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diversity of personal background relative to other board members, including gender, age, and ethnic diversity;

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global and international business experience;

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strategic development experience, including mergers, acquisitions, venture capital and other strategic transactions;

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experience in marketing, engineering, technology and innovation, operations, supply chain, manufacturing and legal;

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high level of financial literacy and experience;

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data analytics experience;

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commercial business experience;

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experience in scaling or growing a startup or small business into a significant business;

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practical and mature business judgment; and

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entrepreneurial spirit and innovativeness.

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DIRECTOR QUALIFICATIONS AND INDEPENDENCE

Independence Determinations

Under the listing standards of The Nasdaq Stock Market LLC (“Nasdaq”), and the company’s Corporate Governance Guidelines, the board must consist of a majority of independent directors. In making independence determinations, the board observes Nasdaq and the Securities and Exchange Commission (“SEC”) criteria and considers all relevant facts and circumstances. To be considered independent under Nasdaq listing standards, a director must pass certain objective tests, such as not being an executive officer or employee of the company or having certain business dealings with the company. Additionally, Nasdaq independence standards include a subjective test that requires our board to make a subjective determination that an individual has no relationships that in the opinion of the company’s board, would interfere with the exercise of independent judgment in carrying out the responsibilities of a director.

The board undertook a review of the independence of each director and nominee and considered whether each such individual has a material relationship with us that could compromise his or her ability to exercise independent judgment in carrying out his or her responsibilities as a director. Based upon information requested from and provided by each director and nominee regarding his or her business and personal activities and relationships as they may relate to us and our management, including the beneficial ownership of our capital stock by each non-employee director and nominee, the board has determined that, other than Mr. Nawabi, all members of the board qualify as independent directors in accordance with the Nasdaq listing standards and Rules 10C-1 and 10A-3 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”).

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2024 NOMINEES FOR CLASS III DIRECTORS

The board and the Nominating and Corporate Governance Committee believe that the combination of the various qualifications, skills and experience of the director nominees would contribute to an effective and well-functioning board. They also believe that the combination of the various qualifications, skills and experiences of the director nominees individually, and when combined with the other directors, will create a board possessing the necessary qualifications to

provide effective oversight of the business and strategic advice and counsel to the company’s management.

Included in the biographies of the director nominees and the other directors below is an assessment of the specific qualifications, attributes, skills and experiences that such director nominees and the other members of the board provide to the board of directors and the company.

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2024 NOMINEES FOR CLASS III DIRECTORS

Director Nominees

		Cindy K. Lewis
		Director Since:				2021
		Age:				67
		Board Committees and Leadership:				Chair of the Cybersecurity Committee; Member of the Audit and Nominating and Corporate Governance Committees
		Summary of Experience:				From July 1998 to June 2023, Ms. Lewis served as the President and Chief Executive Officer of AirBorn Consolidated Holdings, Inc. She has served as Chairperson of AirBorn since November 2013. AirBorn is a middle-market, employee-owned company specializing in high reliability electronics manufacturing. Ms. Lewis has served in the manufacturing industry for over 40 years, with experience in accounting and finance, supply chain and manufacturing, information technology, business development, distribution and general management. From approximately 2006 through 2019, Ms. Lewis served in various board and officer roles for the National and Southwest Chapter of the ESOP Association, which promotes employee ownership awareness, best practices and provides strong lobbying efforts in Congress. Ms. Lewis currently serves on the Georgetown, Texas Chamber of Commerce Board of Directors. Ms. Lewis earned her Bachelor’s Degree in Accounting from The University of Texas at Arlington — College of Business and completed an Executive Development Program at The Wharton School, University of Pennsylvania.
		Specific Qualifications, Attributes, Skills and Experience
						Global or International Business Experience Ms. Lewis has over 20 years of international business experience while at AirBorn, including developing both a broad global supply chain and a growing a global customer base. AirBorn has manufacturing locations in Canada and Europe, as well as strong contract manufacturing relationships in Asia. Ms. Lewis’ international business experience is a valuable asset to our board as we grow our international presence and sales.
						Science, Technology and Innovation Experience Ms. Lewis’s career includes management, development and oversight of various types of technologies. With electronic products that require heavy engineering and collaboration with customers for design, Ms. Lewis managed new product development for AirBorn, as well as new manufacturing processes and automation technologies. AirBorn filed for and received numerous patents under Ms. Lewis’ leadership. Ms. Lewis was the original architect of cybersecurity strategy for AirBorn and is the board cyber sponsor with a certificate of cybersecurity oversight from Carnegie Mellon. Ms. Lewis sponsors digital transformation and digital progression projects to ensure the company keeps pace with the rapid acceleration of software technology in all aspects of the business.
						Related Industry Experience — Customer Relationships Ms. Lewis was directly responsible for managing various key customer relationships, ensuring service, expectations and contract negotiations provided a favorable partnering environment for both AirBorn and its customers. Four of AirBorn’s five original customers from the 1950s remained top ten OEM customers through Ms. Lewis’ retirement as President and Chief Executive Officer of AirBorn. Primary industry experience includes Military Aerospace, Medical, Semiconductor, and Energy.
						Investment and M&A Expertise Ms. Lewis led AirBorn through five acquisitions since 2002, broadening the company’s capabilities and providing strategic market diversification. Ms. Lewis was directly involved in all negotiations with acquisition targets as well as funding for these acquisitions and directed subsequent integration activities. Ms. Lewis also led AirBorn through numerous major refinancing transactions over the years to fund acquisitions and growth capital investments. She led the selection of financial institutions for fund raising for major transactions, and was directly involved in all related contract negotiations. Ms. Lewis additionally led the strategy and execution of the refinancing which transitioned AirBorn to a 100% ESOP owned subchapter S corporation in 2003.
						Experience Scaling and Small Business Under her leadership at AirBorn, Ms. Lewis and her team successfully led the company through several levels of transition from a small connector job shop to a middle market electronics company. Ms. Lewis developed AirBorn’s growth strategy and led the execution of initiatives to achieve AirBorn’s growth.
						Chief Executive Officer and Executive Experience Ms. Lewis served as President and Chief Executive Officer of AirBorn from 1998 to 2023, bringing significant experience and insight to the board from financial, operations and strategic growth perspectives. Her prior positions at AirBorn included Chief Operating Officer, Vice President of Manufacturing, Vice President of Supply Chain and General Manager.

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2024 NOMINEES FOR CLASS III DIRECTORS

		Cindy K. Lewis
						Defense Industry Experience Ms. Lewis has over 30 years of experience providing high reliability products and technical solutions to the Military and Aerospace industries domestically and internationally.
						ESG — Environmental, Social, Governance Ms. Lewis has extensive experience in regulatory compliance and ensured AirBorn maintained robust compliance and governance practices. She oversaw ESG strategy and activities, and led AirBorn’s Diversity, Equity, Inclusion (DEI) activities.

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2024 NOMINEES FOR CLASS III DIRECTORS

		Wahid Nawabi
		Director Since:				2016
		Age:				55
		Board Committees and Leadership:				Chairman of the Board; member of the Executive Committee
		Summary of Experience:				Mr. Nawabi has served as our President and Chief Executive Officer since May 2016. Previously, Mr. Nawabi served as our President and Chief Operating Officer from January 2016 to May 2016 and as Senior Vice President and Chief Operating Officer from April 2015 to January 2016. He also served as Senior Vice President and General Manager, EES from December 2011 to April 2015. Prior to joining the company, Mr. Nawabi served as Vice President, Global Sales of Altergy Systems, a designer and manufacturer of fuel cell power systems, from March 2010 through November 2011, and as Vice President, Americas, and Vice President, Global Sales for C&D Technologies, a producer and marketer of electrical power storage and conversion products, from February 2009 through March 2010. Prior to joining C&D Technologies, Mr. Nawabi worked for 16 years with American Power Conversion Corporation, a provider of power protection products and services, in a succession of positions of increasing responsibility, most recently as Vice President, Enterprise Segment, North America and Canada. During his 16-year tenure at American Power Conversion, Mr. Nawabi was instrumental to the company’s growth into global market leadership positions in power protection and data center physical infrastructure, with significant roles in starting and growing the company’s data center physical infrastructure business and in developing and expanding the company’s business across Europe and Asia. Mr. Nawabi currently serves as the Chairman of the Board of LiquidStack, Inc., a provider of next-generation cooling solutions to many of the world’s largest cloud services, semiconductor, manufacturing and IT hardware providers. Mr. Nawabi has a B.S. in electrical engineering from the University of Maryland, College Park.
		Specific Qualifications, Attributes, Skills and Experience
						Chief Executive Officer and Executive Experience Mr. Nawabi brings significant executive and leadership experience to the board from his experience in various executive roles at the company since 2011 and his prior experience at Altergy Systems, C&D Technologies and American Power Conversion.
						Extensive Knowledge of the Company’s Business Mr. Nawabi has gained extensive knowledge of our business operations since joining our company in 2011 as Senior Vice President and General Manager, EES. His knowledge of all aspects of our business, operations and products, including his current service as our President and Chief Executive Officer, allows him to bring valuable practical information and insight to the board.
						Extensive Global or International Business Experience Through his experience as Vice President, Global Sales of Altergy Systems and of C&D Technologies, as well as his service as our Chief Operating Officer, President and Chief Executive Officer, Mr. Nawabi has gained extensive international business experience. At C&D Technologies, Mr. Nawabi helped expand and grow the business throughout Latin America, which led to the expansion of the company’s presence both in manufacturing capacity as well as sales, marketing and customer service in such regions. Additionally, Mr. Nawabi helped develop American Power Conversion’s business across Europe and Asia. As our international sales continue to increase, Mr. Nawabi’s international experience is a valuable asset to our board.
						Science Technology and Innovation Experience As the General Manager of the company’s former EES business segment, Mr. Nawabi oversaw the launch of multiple innovative and successful new products to market and was responsible for revamping the division’s product development processes, which were eventually implemented across the company’s UxS segment as well. Additionally, while at American Power Conversion, Mr. Nawabi was instrumental in launching numerous innovative products to market, many of which were recognized as “industry firsts.”

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2024 NOMINEES FOR CLASS III DIRECTORS

		Joseph Votel
		Director Since:				2023
		Age:				66
		Board Committees and Leadership:				None
		Summary of Experience:				General Joseph L. Votel has served as a member of our board of directors since November 2023. Mr. Votel is a retired four-star general with 39 years of military experience. He most recently served as the Commanding General of the United States Central Command and before that was the Commander of the United States Special Operations Command. He served in the Pentagon, Operation ENDURING FREEDOM, and Operation IRAQI FREEDOM, among others. Following his retirement from military service, General Votel served as President & CEO of Business Executives for National Security (BENS). He is a member of the Board of Trustees of Noblis Corporation and a Strategic Advisor for Sierra Nevada Corporation. Mr. Votel is a Board Director with Minnesota Wire & Cable Company, a custom design, development and manufacturing company for wire, cable and interconnect assemblies DC Capital Partners, LLC, a private equity investment firm, and Helix Decision Science, LLC, a technology company focused on the interaction of AI systems, supporting technologies and data across businesses, and a member of the Government Advisory Board for Insight Partners. He is a non-resident Distinguished Fellow at the Middle East Institute and the Distinguished Chair of the Combating Terrorism Center at West Point. Mr. Votel is a member of the Executive Boards at Freedom House and the UPenn Center for Ethics and the Rule of Law (CERL). He is a current member of the Defense Business Board and the Council on Foreign Relations. Mr. Votel graduated from the United States Military Academy in 1980 and earned a master’s degree from the U.S. Army Command and Staff College in 1991 and from the Army War College in 2001.
		Specific Qualifications, Attributes, Skills and Experience
						Defense and Related Industry Experience Drawing from his extensive 39-year career in the U.S. Army and his involvement with military advisory groups, Mr. Votel brings invaluable experience to our military-focused intelligent, multi-domain robotic systems business. Mr. Votel’s critical insights into the needs and demands of our customers enhance our operations.
						Extensive Global or International Business Experience Mr. Votel possesses substantial international expertise, including a deep understanding of international military clients. This knowledge is particularly pertinent to our growing global business.
						Board Experience Mr. Votel’s tenure as a director and strategic advisor for multiple private companies contributes valuable expertise in corporate governance and board leadership.

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2024 NOMINEES FOR CLASS III DIRECTORS

Continuing Directors

		Philip S. Davidson
		Director Since:				2023
		Age:				64
		Board Committees and Leadership:				Member of the Audit Committee; member of the Cybersecurity Committee
		Summary of Experience:				Mr. Davidson has served as a member of our board of directors since June 2023. Mr. Davidson retired from the U.S. Navy in May 2021, following a highly distinguished military career which spanned nearly 39 years of service and culminated in his appointment as a four-star Admiral and in service as Commander of United States Indo-Pacific Command (INDOPACOM) from 2018 to 2021. He previously served as the commander of U.S. Fleet Forces Command/Naval Forces U.S. Northern Command and as the commander, U.S. 6th Fleet, and the commander, Naval Striking and Support Forces NATO, while simultaneously serving as the deputy commander, U.S. Naval Forces Europe and U.S. Naval Forces Africa. Mr. Davidson founded and now runs Davidson Strategies LLC, a management, technical and strategic advisory firm. Mr. Davidson is currently on the board of directors of Par Pacific Holdings, Inc. (NYSE: PARR), an oil and gas exploration and production company, and Norfolk Southern Corporation (NYSE: NSC), a freight transportation network operator. He is also a Board Member at the Center for Strategic and Budgetary Assessments, an independent, non-partisan policy research institute, and serves on military advisory groups to the Sasakawa Peace Foundation USA, as well as the United States Institute of Peace. He received a Bachelor of Science degree in Physics from the U.S. Naval Academy in 1982 and a Master of Arts in National Security and Strategic Studies from the U.S. Naval War College in 1992.
		Specific Qualifications, Attributes, Skills and Experience
						Defense and Related Industry Experience From his 39 years of service in the U.S. Navy, and service on military advisory groups, Mr. Davidson brings highly relevant experience to our military-focused intelligent, multi-domain robotic systems business. He offers critical insight into the needs and demands of our UxS customers.
						Extensive Global or International Business Experience As a result of his military service and consulting experience, Mr. Davidson has extensive international business experience, including knowledge of international military customers, which is highly relevant to our expanding international business.
						Public Company Board Experience Mr. Davidson’s service as a director of Par Pacific Holdings, Inc. and Norfolk Southern Corporation provides us with valuable corporate governance and board leadership experience.

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2024 NOMINEES FOR CLASS III DIRECTORS

		Mary Beth Long
		Director Since:				2023
		Age:				60
		Board Committees and Leadership:				Member of the Compensation Committee; member of the Cybersecurity Committee
		Summary of Experience:				Ms. Long is an American foreign policy expert, entrepreneur, and former U.S. Government official. From 2007-2009, Ms. Long served as the Assistant Secretary of Defense under Secretary of Defense Robert E. Gates, where she was the first woman confirmed to a four-star military equivalent position by the U.S. Senate. This role was the culmination of 17 years of intelligence and defense related government service where she held multiple leadership roles including Chair of NATO’s nuclear and missile defense High Level Group (HLG), Principal Deputy Secretary of Defense for Asia and Southeast Asia, and Deputy Secretary of Defense for Counter Narco-terrorism. Ms. Long is currently the Principle at both MB Long and Associates, PLLC, a law firm specializing in defense sales, contracting and compliance, and Askari Defense & Intelligence, LLC, a firm focused on international consultancy, since founding each firm in 2010. Ms. Long was also a director for Red Cat Holdings, Inc. (NASDAQ: RCAT), a drone company, from November 2022 through July 2023. Ms. Long additionally acted as a consultant for Global Alliance Advisors, Inc., an international advisory firm, from 2017 to November 2021. In addition, Ms. Long also founded and led a highly successful government contracting firm, Metis Solutions, LLC, which she sold in 2016 to a private equity group. Ms. Long is an Honors Graduate, magna cum laude, and Phi Beta Kappa from Penn State University, where she studied the Chinese language abroad in Taiwan. She currently serves on the university’s Provost’s Global Advisory Council. She also received her law degree, with honors, from Washington and Lee School of Law. Ms. Long is a member of the Board of Directors of the International Spy Museum and the Defense Intelligence Memorial Fund.
		Specific Qualifications, Attributes, Skills and Experience
						Defense and Related Industry Experience Ms. Long is regularly called upon to be a policy expert based on her many post government roles, including as Senior Subject Matter Expert for the Supreme Allied Commander of NATO, Senior Advisor to the Director of USAID at the Department of State, and as a Senior International Advisor to the Minister of Defense of Colombia. Ms. Long is a member of the U.S. Chamber of Commerce Defense and Aerospace Export Council and is a Cipher Brief Expert. She also is an active member of the Council on Foreign Relations (CFR) and has presided over meetings regarding NATO, Ukraine, Afghanistan and other timely topics. From her 17 years intelligence and defense related government service, in addition to her years serving as a multi-disciplinary policy expert, Ms. Long’s experience and insight brings exceedingly relevant experience to our military-focused intelligent, multi-domain robotic systems business.
						Extensive Global or International Business Experience As the owner of the law firm MB Long & Associates, PLLC, specializing in export compliance and defense, as well as founding and leading multiple successful advisory firms focusing on international defense markets, Ms. Long’s international business experience is extremely valuable to us as international business continues to be an increasingly important component of our business.
						Public Company Board Experience Ms. Long’s prior service as a director of Red Cat Holdings, Inc. provides us with valuable corporate governance and board leadership experience.

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2024 NOMINEES FOR CLASS III DIRECTORS

		Stephen F. Page
		Director Since:				2013
		Age:				84
		Board Committees and Leadership:				Chair of the Nominating and Corporate Governance Committee; member of the Audit Committee
		Summary of Experience:				Mr. Page has served as a member of our board of directors since 2013. Mr. Page served on the board of directors and audit committees of Lowe’s Companies, Inc. (NYSE: LOW), a home-improvement retailer, from 2003 to 2012; PACCAR, Inc. (NASDAQ: PCAR), one of the largest manufacturers of medium and heavy-duty trucks in the world, from 2004 to 2012; and Liberty Mutual Holding Company Inc., one of the largest property and casualty insurance companies in the U.S., where he was lead director. Before retiring in 2004, Mr. Page served in many leadership roles at United Technologies Corporation, a provider of high-technology products and services to the global aerospace and building systems industries that merged with Raytheon Corporation in April 2020 to form RTX Corporation (formerly Raytheon Technologies Corporation), including director, Vice Chairman and Chief Financial Officer, and President and Chief Executive Officer of Otis Elevator, formerly a division of United Technologies. Mr. Page holds a B.S. in business administration from Loyola Marymount University and J.D. from Loyola Law School.
		Specific Qualifications, Attributes, Skills and Experience
						Chief Executive Officer and Executive Experience Mr. Page has extensive executive leadership experience at large public companies. He served as Chief Financial Officer of United Technologies, a global provider of high-technology products and support services in the aerospace and building industries with annual revenues of approximately $77 billion prior to its merger with Raytheon Corporation in April 2020, and he also served as Chief Executive Officer of Otis Elevator, a former multibillion dollar revenue generating unit of United Technologies, as Chief Financial Officer of Black & Decker Corporation, a manufacturer of power tools, and as General Counsel of the McCullough Corporation, a subsidiary of Black & Decker.
						Extensive Global or International Business Experience Mr. Page gained extensive experience leading international businesses in his executive leadership roles at United Technologies and as a director of PACCAR. This international business experience is extremely valuable to us as international business becomes an increasingly important component of our business.
						Defense and Related Industry Experience From his experience in leadership roles at United Technologies, Mr. Page brings highly relevant experience to our military-focused unmanned aircraft systems business.
						Commercial Business Experience Mr. Page gained substantial experience in commercial business operations through his positions at United Technologies and Black & Decker Corporation. Mr. Page’s business experience is of significant importance to the board as the company continues to execute on its growth plan.
						Public Company Board Experience Mr. Page’s service as Vice Chairman of United Technologies and as the Lead Independent Director at Liberty Mutual and his experience as a director of United Technologies, PACCAR and Lowe’s provides us with valuable corporate governance and board leadership experience.
						Financial Expertise Having served as Chief Financial Officer of two major public companies and as Audit Committee Chair of Lowe’s, PACCAR and Liberty Mutual, Mr. Page brings a wealth of financial, capital allocation and audit committee experience to the company and the board.

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2024 NOMINEES FOR CLASS III DIRECTORS

		Charles Thomas Burbage
		Director Since:				2013
		Age:				76
		Board Committees and Leadership:				Chair of Compensation Committee, member of Nominating and Corporate Governance Committee and Executive Committee
		Summary of Experience:				Mr. Burbage has served as a member of our board of directors since 2013. Mr. Burbage retired from Lockheed Martin Aeronautics Company in April 2013, after a 33-year career during which he served most recently as Executive Vice President and General Manager, Joint Strike Fighter Program from 2000 to 2013. Mr. Burbage also served on active duty in the U.S. Navy as a Naval aviator and recorded more than 3,000 flight hours in 38 types of military aircraft before retiring as a Captain in the U.S. Naval Reserve in 1994. Mr. Burbage currently serves as a director of Terma North America, Inc., a provider of technology and services for security and defense applications, and GKN Aerospace North America, Inc., a global tier one supplier of airframe and engine structures, landing gear, electrical interconnection systems, transparencies, and aftermarket services. Mr. Burbage received a B.S. in aerospace engineering from the U.S. Naval Academy and holds an M.S. in aeronautical systems from the University of West Florida and an M.B.A. from the University of California, Los Angeles.
		Specific Qualifications, Attributes, Skills and Experience
						Chief Executive Officer or Executive Experience Mr. Burbage was the Lockheed Martin executive responsible for the F-35 Joint Strike Fighter program from its inception to adoption. He brings to the board the experience of managing a complex global program involving U.S. military and international customers and global industrial partners.
						Extensive Global or International Business Experience Mr. Burbage’s leadership of the F-35 Joint Strike Fighter program involved international business development activities on a global basis. The F-35 was sold to more than 10 countries and involved a global manufacturing capability. This experience is particularly relevant to us as we pursue larger and more complex international business opportunities.
						Defense Industry Related Experience In addition to decades of experience as an executive of Lockheed Martin, Mr. Burbage previously served as a Naval aviator and test pilot. He received numerous industry awards, including the U.S. Naval Academy/Harvard Business Review Award for Ethical Leadership. His defense industry and Naval officer experience provides important insights to the board on our largest business and customer set.
						Science, Technology and Innovation Experience Mr. Burbage has an extensive engineering background. He has a B.S. in aeronautical engineering from the U.S. Naval Academy and an M.S. in aeronautical systems from the University of West Florida. He applied this technical and engineering knowledge as a Naval aviator and in his management roles at Lockheed Martin. His background and experience are critically important to the board because of the innovative nature and technical complexity of our products.

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2024 NOMINEES FOR CLASS III DIRECTORS

		Edward R. Muller
		Director Since:				2013
		Age:				72
		Board Committees and Leadership:				Chair of Audit Committee; member of Compensation Committee and Executive Committee; Lead Independent Director
		Summary of Experience:				Mr. Muller has served as a member of our board of directors since 2013. Mr. Muller served as Vice Chairman of NRG Energy, Inc. (NYSE: NRG), a U.S.-based producer and retail supplier of electricity, from December 2012 to February 2017. Prior to the merger in 2012 of NRG and GenOn Energy Inc., Mr. Muller served as the Chairman and Chief Executive of GenOn, which also produced and sold electricity in the United States, a position he held beginning in 2010. From 2005 to 2010, Mr. Muller was Chairman and Chief Executive of Mirant Corporation, which produced and sold electricity in the United States and internationally. Previously, Mr. Muller served as President and Chief Executive Officer of Edison Mission Energy until 2000, which produced electricity in the United States and internationally. Mr. Muller previously served as Vice President, Chief Financial Officer, General Counsel and Secretary of Whittaker Corporation, a conglomerate with activities in aerospace, chemicals, healthcare and metals. From 2007 to 2024, Mr. Muller served as a director of Transocean Ltd. (NYSE: RIG), an offshore oil and gas driller. Mr Muller currently serves as the Chairman of the Advisory Board of the UCLA Institute for Carbon Management and of CarbonBuilt, Inc., a provider of low carbon concrete technology, Concrete, AI, Inc., a provider of AI-assisted concrete production and carbon reductions , and Nextli Technologies, Inc., a cement decarbonization company, and acts as the Chairman and CEO for Equatic, Inc., a carbon-capture technology company, Specifx, Inc., developer of lithium extraction technologies, and x/44, Inc., a technology company developing direct air capture of carbon dioxide. He previously served as a director of Contact Energy, Ltd., Edison Mission Energy, Interval, Inc., Oasis Residential, Inc., Ormat Technologies, Inc., RealEnergy, Inc., RigNet Inc., Strategic DataCorp., The Keith Companies, Inc., and Whittaker Corporation. Mr. Muller is a member of the Council on Foreign Relations and the Pacific Council on International Policy, and previously was Chairman of the U.S. — Philippines Business Committee, Co-Chairman of the International Energy Development Council and a member of the Board of Trustees of the Riverview School. Mr. Muller received his undergraduate degree from Dartmouth College and a J.D. from Yale Law School.
		Specific Qualifications, Attributes, Skills and Experience
						Chief Executive Officer and Executive Experience Mr. Muller brings broad and extensive executive leadership experience to our board, having served as Chief Executive Officer of large companies that produced electricity for more than 15 years and as Chief Financial Officer and General Counsel of Whittaker Corporation.
						Public Company Board Experience Serving or having served as a director of 11 different public companies, Mr. Muller brings tremendous business and corporate governance oversight experience to the company and its board.
						Financial Expertise Mr. Muller has extensive financial and accounting experience as a Chief Executive Officer of several energy companies and as Chief Financial Officer of Whittaker Corporation and from serving on numerous public company audit committees. Our board and Audit Committee benefit from Mr. Muller’s extensive financial and accounting experience.
						Extensive Global or International Business Experience Mr. Muller has extensive international business experience and is a recognized expert on international policy and energy development. Besides his substantial international business experience as a Transocean Ltd. director, Mr. Muller serves as a Member of the Council on Foreign Relations and the Pacific Council on International Policy and was previously Chairman of the U.S. Philippines Business Committee and Co-Chairman of the International Energy Development Council.

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2024 NOMINEES FOR CLASS III DIRECTORS

SUMMARY OF DIRECTOR NOMINEES

The following information and graphics summarize the qualifications of the nominees for Class III director and the other continuing members of the board. Based on a careful assessment, the Nominating and Corporate Governance Committee and the board have concluded that each nominee is qualified to serve as a director and that the collective board, including the nominees for election, possesses the necessary qualifications, attributes, skills and experience to provide effective oversight of the business and provide strategic advice and counsel to the company’s management.

Nominees and other directors exhibit:

	• High integrity			• Innovative thinking
	• Proven record of success			• Knowledge of corporate governance

Our director nominees and other directors bring a balance of important skills to our boardroom

The fact that an item is not highlighted for a director does not mean that the director does not possess that qualification, attribute, skill or experience.

Nominees

Continuing Directors

Totals

Attribute

Nawabi

Lewis

Votel

Davidson

Burbage

Page

Muller

Long

Nominees

Board

CEO and Executive Experience

✓

Knowledge of Company Business

✓

Defense/Aerospace Industry or
Military Experience

✓

International Business Experience

✓

Other Public Board Experience

✓

Science, Technology and
Innovation

✓

Commercial Business Experience

✓

Financial Literacy

✓

Strategic Development Experience

✓

Scaling Business Experience

✓

Data Analytics Experience

✓

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Our director nominees and other continuing directors provide an effective mix of experience and fresh perspective.

INDEPENDENCE

PRIOR BOARD SERVICE

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Board of Directors and Committees

Our board of directors functions in a collaborative manner and all directors play an active role in overseeing the company’s business both at the board and committee levels. The 2024 director nominees consist of three Class III director nominees, two of which are independent directors and each of whom has significant leadership experience and knowledge of the company’s industry.

Pursuant to our bylaws, our board must annually elect one of its members to serve as Chairman of the Board, who shall preside over meetings of the board and stockholders, consult and advise the board and its committees on the business and affairs of the company, and perform such other duties as may be assigned by the board. Our bylaws also require the board to designate annually an independent director to serve as the Lead Independent Director if the Chairman of the Board is not an independent director. The designation of a Lead Independent Director is for a one-year term and a Lead Independent Director may be eligible for re-election at the end of that term. Designation as such does not impose on the Lead Independent Director any obligation or standard greater than or different from those of the company’s other directors. The Lead Independent Director has the following roles and responsibilities:

•

presides at all meetings of the board or stockholders at which the Chairman of the Board is not present;

•

serves as a liaison on board-related issues between the Chairman of the Board and the independent directors;

•

reviews and provides input to the Chairman of the Board regarding the nature, scope and timeliness of information that management provides to the board;

•

reviews and provides input to the Chairman of the Board regarding the agendas for board meetings and the annual schedule of board meetings;

•

presides at meetings of the independent directors and apprises the Chairman of the Board of the issues discussed, as appropriate; and

•

performs such other duties as the board may from time to time delegate.

Our officers, under the direction of our Chief Executive Officer, are generally in charge of the day-to-day affairs of the company, subject to the powers reserved to the board.

As set forth in the company’s Corporate Governance Guidelines, regularly scheduled executive sessions of independent directors are held at least twice per year. These meetings allow our independent directors to discuss issues of importance to the company, including the business and affairs of the company, as well as matters concerning management, without any member of management present. Independent directors chair all of the board committees (except our Executive Committee), which are described below.

Board Leadership Structure

We do not have a formal policy regarding the separation of the roles of Chairman of the Board and Chief Executive Officer. The company’s governance framework provides the board with flexibility to select the appropriate leadership structure for long-term success of the company. In making leadership structure determinations, including whether to separate or combine the Chairman of the Board and Chief Executive Officer roles, the board considers many factors, including the specific needs of the business and what is in the best interests of the company’s stockholders.

Our current leadership structure is as follows:

•

Chairman of the Board, President and Chief Executive Officer: Wahid Nawabi

•

Lead Independent Director: Edward R. Muller

•

Committees led by independent directors

•

Active engagement by all directors

The board believes that this leadership structure, consisting of a combined Chairman of the Board and Chief Executive Officer, an independent director serving as Lead Independent Director and strong, active independent directors, is the optimal structure to guide our company and maintain the focus required to achieve our business goals. The board believes this structure provides an effective balance between strong company leadership and appropriate safeguards and oversight by independent directors. It provides a single leader who is understood by our employees, customers, business partners, and stockholders as providing strong leadership for the company, which enhances our ability and agility to manage resources and provides the focus required to implement our complex business strategy.

The Board’s Role in Strategy Oversight

Our board of directors is actively involved in overseeing our strategy and its execution. In addition to discussing

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business goals and priorities and broader strategic issues regularly, the board engages with management on future opportunities for the company and how emerging trends, technologies and global developments may impact the company, our customers and business partners, end markets and our stakeholders and how the company should navigate such matters. Our board of directors guides our strategic direction and helps ensure our business strategies align to long-term value creation.

The Board’s Role in Risk Oversight

Our board of directors is responsible for overseeing our risk management and delegates many of these functions to the Audit and Cybersecurity Committees, which report regularly to the board. Under its charter, the Audit Committee is responsible for discussing with management the company’s policies with respect to risk assessment and risk management. The committee is chartered to discuss with management our significant risk exposures and the actions management has taken to limit, monitor or control such exposures. Under its charter, the Cybersecurity Committee is responsible for reviewing, discussing, and making recommendations to the full board of directors regarding cybersecurity matters, including cyber risks. In addition to the Audit and Cybersecurity Committees’ work in overseeing risk management, our full board engages in discussions of the most significant risks that we face and how these risks are being managed. Our Compensation and Nominating and Corporate Governance Committees are also involved in evaluating risks that fall within the purview of those committees’ responsibilities.

The Board’s Role in Environmental, Social and Governance (ESG) Matters Oversight

Our board of directors provides oversight of ESG matters and regularly receives reports from our ESG Committee. Formed in 2020, the company’s ESG Committee, which is comprised of members of senior management and other functional area leaders, sets goals regarding ESG matters, directs ESG initiatives, and reviews progress on ESG matters with the board.

In 2022, the ESG Committee, with support of the board, commissioned the company’s first Corporate Social Responsibility (“CSR”) report, that was published on the company website in August 2022. The company has since published an annual CSR report and expects to publish its report for fiscal year 2024 in August 2024. The Compensation Committee of the board also included an ESG metric in each of the 2022, 2023, and 2024 executive bonus plans. Company management included the same ESG metrics as the executive bonus

plans in the 2022, 2023 and 2024 bonus plans for non-executive employees as well.

The Board’s Role in Human Capital Management

The board acknowledges that our employees are the company’s most valuable asset and the driving force behind our success, and seeks to ensure that the company is known for cultivating a positive and welcoming work environment — one that fosters growth, provides a safe place to work, supports diversity and embraces inclusion. Our board of directors believes that a diverse and inclusive workforce is a major catalyst for driving innovation and an important aspect of our ESG efforts.

Board Meetings

Under the company’s bylaws, regular meetings of the board are held at such times as the board may determine. Special meetings of the board may be called by the Chairman of the Board or the President on 48 hours’ notice to each director or by the President or the Corporate Secretary after receiving a written request of two directors on 48 hours’ notice. The board held 11 meetings in fiscal year 2024. Each director attended at least 75% of all meetings of the board of directors and each committee on which he or she sat during fiscal year 2024.

Annual Meeting Attendance

The company does not have a formal policy regarding directors’ attendance at annual meetings of stockholders, but encourages all directors to attend such meetings. All seven directors who were serving as directors after the start of the 2023 annual meeting of stockholders attended the annual meeting.

Board Committees

The board has an Audit Committee, a Compensation Committee, a Nominating and Corporate Governance Committee, a Cybersecurity Committee, and an Executive Committee. The board has adopted a written charter for each of these committees, which are available on the company’s website at www.avinc.com by clicking on “Investors” and then clicking on “Corporate Governance”. All of the members of each of these standing committees (other than the Executive Committee) meet the criteria for independence prescribed by the SEC and Nasdaq. The information contained on our website is not incorporated by reference into, and does not form a part of, this proxy statement. Our board of directors may establish other committees to facilitate the management of our business. Additional information about the committees is provided below.

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Audit Committee

	Committee Chair:			Edward R. Muller
	Other Committee Members:			Stephen F. Page, Cindy K. Lewis and Philip Davidson
	Meetings held in FY2024:			5

The board has determined that Mr. Muller, Mr. Page, and Ms. Lewis qualify as audit committee financial experts as defined by the rules of the SEC. All committee members are able to read and understand fundamental financial statements in accordance with Nasdaq requirements. Our Audit Committee’s main function is to oversee our accounting and financial reporting processes, internal systems of control, independent registered public accounting firm relationships and the audits of our financial statements. The Audit Committee’s responsibilities include:

•

selecting and hiring our independent registered public accounting firm;

•

evaluating the qualifications, independence and performance of our independent registered public accounting firm;

•

reviewing and approving the audit and non-audit services to be performed by our independent registered public accounting firm;

•

reviewing the design, adequacy, implementation and effectiveness of our internal controls established for finance, accounting, legal compliance and ethics;

•

reviewing the design, adequacy, implementation and effectiveness of our critical accounting and financial policies;

•

overseeing and monitoring the integrity of our financial statements and our compliance with legal and regulatory requirements as they relate to financial statements or accounting matters;

•

reviewing with management and our independent registered public accounting firm our annual and quarterly financial statements;

•

reviewing with management and our independent registered public accounting firm any earnings announcements or other public announcements concerning our operating results;

•

establishing procedures for the receipt, retention and treatment of complaints (including procedures for receiving and handling complaints on a confidential and anonymous basis) regarding accounting, internal accounting controls or auditing matters, including employee concerns regarding questionable accounting or auditing matters;

•

preparing the audit committee report that the SEC requires in our annual proxy statements; and

•

reviewing and approving any related party transactions.

Our Amended & Restated Code of Business Conduct and Ethics (“code of conduct”), is our code of ethics for directors, executive officers, employees and agents. Any amendment to the code of conduct that applies to our directors or executive officers may be made only by the board or a board committee and will be disclosed on our website.

The code of conduct is available at http://investor.avinc.com. The Audit Committee charter and the code of conduct are also available in print to any stockholder who requests them.

Compensation Committee

	Committee Chair			Charles Thomas Burbage
	Other Committee Members:			Edward R. Muller and Mary Beth Long
	Meetings held in FY2024			8

Our Compensation Committee’s purpose is to assist our board of directors in determining the development plans and compensation for our executive officers and the compensation to be paid to directors for board and committee service. The Compensation Committee of our board consists of three independent directors. The Compensation Committee’s responsibilities with respect to executive and director compensation are:

•

to review our compensation philosophy;

•

to review and recommend to the board corporate goals and objectives relating to the compensation of our Chief Executive Officer, evaluate the performance of our Chief Executive Officer in light of those goals and objectives and review and recommend to the board the compensation of our Chief Executive Officer;

•

to review and approve all compensation of our executive officers and all other officers subject to the reporting requirements of Section 16(a) of the Exchange Act;

•

to review all employment agreements and severance arrangements of executive officers;

•

to review and recommend to the board compensation for non-management directors’ service on the board and any committees;

•

to review all annual bonus, long-term incentive compensation, stock option, employee pension and welfare benefit plans;

•

to review and approve the Compensation Discussion and Analysis contained in this proxy statement; and

•

to review and approve executive officer indemnification and insurance matters.

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In addition, the Compensation Committee is responsible for the general administration of all executive compensation plans, including:

•

setting performance goals for our executive officers and reviewing their performance against these goals;

•

approving all amendments to, and terminations of, all such compensation plans and any awards under such plans;

•

granting awards under any performance-based annual bonus, long-term incentive compensation and equity compensation plans to executive officers; and

•

making recommendations to the board with respect to awards for directors under our equity incentive plans.

The Compensation Committee also has the sole authority, in accordance with applicable securities laws, rules and regulations and Nasdaq listing standards, to retain and/or replace, as needed, any independent counsel, compensation and benefits consultants and other outside experts or advisors as the Compensation Committee believes to be necessary or appropriate. The Compensation Committee is responsible for the appointment, compensation, and oversight of the work of any compensation advisors retained by the Compensation Committee. Subject to any exceptions under the Nasdaq listing standards, prior to selection and engagement of any compensation advisor, the Compensation Committee will undertake an analysis of the independence of each such compensation advisor under the independence factors specified in the applicable requirements of the Exchange Act and the Nasdaq listing standards. The company will provide for appropriate funding, as determined by the Compensation Committee in its sole discretion, for payment of compensation to any compensation advisors retained by the Compensation Committee.

Compensation Committee Interlocks and Insider Participation

The members of our Compensation Committee during the fiscal year ended April 30, 2024 were Charles Thomas Burbage, Edward R. Muller, Mary Beth Long and Catherine Merigold, from May 1, 2023 through September 29, 2023. None of the fiscal year 2024 or proposed members of our Compensation Committee at any time has been one of our executive officers or employees. None of our executive officers currently serves, or in the past year has served, as a member of the board of directors or compensation committee of any entity that has one or more executive officers serving on our board of directors or Compensation Committee.

Nominating and Corporate Governance Committee

	Committee Chair:			Stephen F. Page
	Other Committee Members:			Charles Thomas Burbage and Cindy K. Lewis
	Meetings held in FY2024:			7

Our Nominating and Corporate Governance Committee’s purpose is to assist our board by identifying individuals qualified to become members of our board of directors, consistent with criteria set by our board, and to develop our corporate governance principles. The Nominating and Corporate Governance Committee’s responsibilities include:

•

evaluating the composition, size and governance of our board of directors and its committees and making recommendations regarding future planning and the appointment of directors to our committees;

•

administering a policy for considering stockholder nominees for election to our board of directors;

•

evaluating and recommending candidates for election to our board of directors;

•

overseeing our board’s performance and self-evaluation process; and

•

reviewing our corporate governance principles and providing recommendations to the board regarding possible changes.

Our board of directors believes that it should be composed of directors with varied, complementary backgrounds and that directors should, at a minimum, have expertise that may be useful to the company. Directors should also possess the highest personal and professional ethics and should be willing and able to devote the required amount of time to our business.

When evaluating director candidates, the Nominating and Corporate Governance Committee takes into account the degree to which a candidate fulfills the criteria contained in the Corporate Governance Guidelines and other factors consistent with those guidelines, including the following:

•

independence from management;

•

personal and professional integrity, ethics and values;

•

practical and mature business judgment;

•

experience as a Chief Executive Officer, President or other executive officer of a public or large private company;

•

extensive knowledge of the company’s business or experience in one or more industries in which we compete, including aerospace and defense, or industrials;

•

global and international business experience;

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•

experience in strategic development activities, including mergers, acquisitions, partnerships and venture capital transactions;

•

experience in marketing, engineering, technology and innovation, operations, supply chain and manufacturing, and legal;

•

educational experience;

•

a high degree of financial literacy and experience;

•

experience as a board member of another publicly held company;

•

diversity of expertise and experience in substantive matters pertaining to our business relative to other board members;

•

diversity of personal background relative to other board members, including gender, age, and ethnic diversity;

•

data analytics experience;

•

commercial business experience; and

•

experience in scaling or growing a startup or small business into a significant business.

The Nominating and Corporate Governance Committee will consider candidates for director suggested by stockholders applying the criteria for candidates described above and considering the additional information referred to below. Stockholders wishing to suggest a candidate for director should write to the Corporate Secretary and include:

•

a statement that the writer is a stockholder and is proposing a candidate for consideration by the committee;

•

the name of and contact information for the candidate and stockholder making the recommendation;

•

a statement detailing any relationship between the candidate and any of our customers, suppliers or competitors;

•

with respect to each of the proposing stockholder and the candidate, the class and number of shares of our capital stock which are, directly or indirectly, owned beneficially or of record;

•

with respect to each of the proposing stockholder and the candidate, any derivative, swap or other transaction, or series of transactions, the purpose or effect of which is to give such party economic risk similar to ownership of shares of our capital stock;

•

with respect to each of the proposing stockholder and the candidate, any proxy, agreement, arrangement, understanding or relationship that confers a right to vote any of our shares of capital stock;

•

with respect to each of the proposing stockholder and the candidate, any agreement, arrangement, understanding or relationship engaged in, directly or indirectly, to reduce the level of risk of loss to, or increase or decrease the voting power of, such party with respect to our shares of capital stock, or which provides, directly or indirectly, the opportunity to profit from any decrease in the price or value of our shares of capital stock;

•

with respect to each of the proposing stockholder and the candidate, any right to dividends on any of our shares of capital stock owned beneficially by such party that are separated from our underlying shares of capital stock;

•

with respect to each of the proposing stockholder and the candidate, opportunity to profit from, or any performance-related fees such party is entitled to, based on the increase or decrease in the value of any of our shares of capital stock;

•

all information relating to the proposing stockholder and the candidate that is required to be disclosed in a proxy statement or other filings required to be made in connection with solicitations of proxies or consents for election of directors in a contested election pursuant to Section 14 of the Exchange Act (including such candidate’s written consent to being named in the proxy statement as a nominee and to serving as a director if elected);

•

a description of all direct and indirect compensation and other material monetary agreements, arrangements and understandings during the past three years, and any other material relationships, between or among the proposing stockholder, on the one hand, and the candidate, his or her respective affiliates and associates, on the other hand, including, without limitation, all information that would be required to be disclosed pursuant to Item 404 under Regulation S-K promulgated under the Exchange Act if such proposing stockholder were the “registrant” for purposes of such rule and the candidate were a director or executive officer of such registrant; and

•

a completed and signed questionnaire, representation and agreement with respect to the candidate’s background, any voting commitments or compensation arrangements and the candidate’s commitment to abide by our Corporate Governance Guidelines.

Under our bylaws, eligible stockholders may also nominate persons for our board of directors for inclusion in our Proxy Statement. This is commonly known as “proxy access.” A stockholder, or a group of up to 20 stockholders, owning at least three percent of our outstanding common stock continuously for at least three years, may nominate and include in our

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proxy materials director nominees constituting up to the greater of two individuals or twenty percent of the Board, subject to certain limitations and provided that the stockholders and the nominees satisfy the requirements specified in our bylaws.

In addition, we may require any candidate to furnish such other information as may reasonably be required by us to determine the eligibility of such candidate to serve as an independent director in accordance with our Corporate Governance Guidelines or that could be material to a reasonable stockholder’s understanding of the independence or lack of independence of such candidate.

Before nominating a sitting director for re-election at an annual meeting, the Nominating and Corporate Governance Committee will consider:

•

the director’s performance on the board of directors; and

•

whether the director’s re-election would be consistent with our Corporate Governance Guidelines.

Cybersecurity Committee

	Committee Chair:			Cindy K. Lewis
	Other Committee Members:			Philip Davidson and Mary Beth Long
	Meetings held in FY2024:			6

In September 2023, our Nominating and Corporate Governance Committee recommended, and our board unanimously approved, the establishment of the Cybersecurity Committee. Our Cybersecurity Committee’s purpose is to assist the board in fulfilling its oversight of the company’s cybersecurity programs and risks. The Cybersecurity Committee’s responsibilities include:

•

the company’s overall cybersecurity posture, including review of the company’s policies, plans, metrics and programs relating to the enterprise cybersecurity and data protection risks;

•

the effectiveness of the company’s programs and practices for identifying, assessing, mitigating, responding to and recovering from such risks across the company’s business operations, including management’s role and expertise in assessing and managing material risks from cybersecurity threats;

•

data management and protection, including security of the company’s data held on and off-site (domestic and international), encryption practices, and third party use of the company’s customers’ data, including any cybersecurity risks associated with the company’s outside partners (e.g. vendors, suppliers, etc.);

•

any significant cybersecurity incidents; and

•

consideration of the impact of emerging cybersecurity developments and regulations that may affect the company.

The Cybersecurity Committee solicits presentations on the company’s cybersecurity program from the company’s Chief Information Security Officer and Director of Global Cybersecurity at each of the Committee’s regularly scheduled quarterly meetings. These briefings include assessments of the cyber risk and threats landscape, updates on incidents, policies and procedures, and our investments and plans in cybersecurity risk mitigation and governance.

The Cybersecurity Committee also meets with members of the company’s Cybersecurity Council to discuss various aspects of our cybersecurity program in between regular meetings. All members of the board of directors are invited to attend all meetings of the Cybersecurity Committee and the committee regularly briefs the entire board of directors regarding their oversight of our cybersecurity program.

Executive Committee

	Committee Chair:			Wahid Nawabi
	Other Committee Member:			Charles Thomas Burbage and Edward Muller
	Meetings held in FY2024:			0

Our Executive Committee’s purpose is to exercise the powers of the board of directors when the board is not in session, subject to specific restrictions as to powers retained by the full board of directors or delegated to other committees of the board of directors. Powers retained by the full board of directors include those relating to amendments to our certificate of incorporation and bylaws, mergers, consolidations and sales or exchanges involving substantially all of our assets.

Board & Committee Self-Evaluations

The board of directors conducts annual self-evaluations to assess the qualifications, attributes, skills and experience represented on the board and to determine whether the board and its committees are functioning effectively. During the year, the Nominating and Corporate Governance Committee receives input on the performance of the board and its committees (other than the Executive Committee) from directors and discusses the input with the full board. The self-assessment focuses on the board’s contribution to the company and on areas in which the board believes that the board or any of its committees could improve.

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Communication with the Board

The board has established a process to facilitate communication with stockholders and other interested parties. Communications can be addressed to the directors in care of the Corporate Secretary, 241 18th Street South, Suite 650, Arlington, VA 22202 or by email to corporatesecretary@avinc.com. At the direction of the board, all mail received may be opened and screened for security purposes. The board of directors has requested that certain items that are unrelated to the duties and responsibilities of the board of directors should be excluded, including the following: junk mail and mass mailings; product complaints; product inquiries; new product suggestions; resumes and other forms of job inquiries; surveys; and business solicitations or advertisements. In addition, material that is unduly hostile, threatening, illegal or similarly unsuitable will not be distributed, with the provision that any communication that is not distributed will be made available to any independent director upon request. Mail addressed to a particular director will be forwarded or delivered to that director. Mail addressed to “outside directors” or “non-employee directors” will be forwarded or delivered to the Lead Independent Director. Mail addressed to the “board of directors” will be forwarded or delivered to the Chairman of the Board.

Commitment to Good Corporate Governance

The board has adopted various policies and guidelines as part of the company’s commitment to good corporate governance. Examples of such polices include:

•

anti-hedging and anti-short sale policies for executives, directors and employees which prohibit the use any strategies or products (including derivative securities, such as put or call options, or short-selling techniques) to hedge against potential changes in the value of our common stock;

•

share ownership guidelines and share retention policy for executives and directors;

•

limitation on number of public companies on which directors can serve without receiving prior approval of the Chair of the Nominating and Corporate Governance Committee, (a) a director may not serve on the boards of more than four other public companies, and (b) a director who is an active CEO or equivalent of a public company, may not serve boards of more than two other public companies; and

•

a Nasdaq Rule 5608 compliant compensation recovery policy for executives.

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Board Diversity

Although the board does not have a formal policy regarding diversity, the Nominating and Corporate Governance Committee’s evaluation of director nominees includes consideration of their ability to contribute to the diversity of personal and professional experiences, opinions, perspectives and backgrounds on the board. Nominees are not discriminated against based on race, color, religion, sex, ancestry, national origin, sexual orientation, disability or any other basis prescribed by law. The Nominating and Corporate Governance Committee assesses the effectiveness of this approach as part of its review of the board’s composition as well as in the course of the board’s and Nominating and Corporate Governance Committee’s self-evaluation. With the assistance of the Nominating and Corporate Governance Committee, the Board regularly reviews trends in board composition, including on director diversity.

Board Diversity Matrix (As of August [•], 2024)
Total Numbers of Directors	8
	Female	Male	Non-Binary	Did not Disclose Gender
Part 1: Gender Identity
Directors	2	6	0	0
Part 2: Demographic Background
African American or Black	0	0	0	0
Alaskan Native or Native American	0	0	0	0
Asian	0	1	0	0
Hispanic or Latinx	0	0	0	0
Native Hawaiian or Pacific Islander	0	0	0	0
White	2	5	0	0
Two or More Races or Ethnicities	0	0	0	0
LGBTQ+	0
Did Not Disclose Demographic Background	0
Part 3: Additional Diversity Characteristics
Military Veteran	0	3

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Compensation of Non-Employee Directors

The general policy of our board of directors is that compensation for non-employee directors should be delivered through a mix of cash and equity-based pay. We do not pay management directors for board service in addition to their regular employee compensation. Our Compensation Committee, which consists solely of independent directors, has the primary responsibility for reviewing and considering any revisions to director compensation. The board of directors reviews the Compensation Committee’s recommendations and determines the amount of director compensation.

The Compensation Committee engages an independent compensation consultant, Pay Governance LLC (“Pay Governance”), a national compensation consulting firm, to assist it in reviewing director compensation. In June 2023, Pay Governance

prepared a report for the Compensation Committee with non-employee director compensation data of peer companies identified by Pay Governance, which the Compensation Committee and the board of directors used in setting non-management director compensation for fiscal year 2024. In June 2023, after reviewing the report prepared by Pay Governance and discussing the compensation of non-management directors with Pay Governance, the Compensation Committee recommended, and the board determined, that the cash retainers for fiscal 2024 service remain unchanged from fiscal year 2023 levels and that the equity grant portion of compensation for fiscal year 2024 service be increased to $150,000 to align with market compensation practices.

The table below presents the annual cash retainer fees for our non-employee directors in effect in fiscal year 2024.

Director Responsibilities1			Annual Retainer
Board Members			$60,000
Lead Independent Director			$20,000
Chair of Audit Committee			$20,000
Audit Committee Member (not including Chair)			$10,000
Chair of Nominating and Corporate Governance Committee			$10,000
Nominating and Corporate Governance Committee Member (not including Chair)			$ 5,000
Chair of Compensation Committee			$15,000
Compensation Committee Member (not including Chair)			$ 7,000

No retainers were paid for Cybersecurity Committee service in fiscal year 2024. No retainers are paid for Executive Committee service.

Annual retainer amounts are paid in four equal quarterly installments at the beginning of each of our fiscal quarters if the individual is still serving as a director at such time. We also reimburse non-employee directors for out-of-pocket expenses incurred in connection with their service as a director, such as attending board or committee meetings. We also pay for travel and hospitality costs for the spouses of directors to accompany such directors to an offsite board meeting, which expenses did not exceed $10,000 in fiscal year 2024 for any director.

In addition to cash retainer fees, our non-employee directors also receive an annual grant of restricted stock, which awards vest in three equal annual installments over a three-year period beginning approximately one year from the date of grant. Based on the report provided by Pay Governance in

June 2023 and a subsequent discussion with Pay Governance, the Compensation Committee recommended, and the board approved, an annual grant of restricted stock awards with an aggregate value of $150,000 to each non-management director for their fiscal year 2024 service. These annual awards for fiscal year 2024 service were granted in June 2023 to our non-employee directors serving as directors at such time. Such awards vest in three equal installments on July 11, 2024, 2025 and 2026. The number of shares subject to such awards was calculated on the date of grant based on the closing price per share of our common stock on such date. Newly elected or appointed non-employee directors will be granted restricted stock awards with an aggregate value of $170,000 on the date of grant (measured by the closing price per share of our common stock subject to the

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awards on the date of grant). The annual and new director equity grant values were determined by the board to be competitive with non-employee director equity awards at comparable companies based on discussions with Pay Governance. After her election to the board at the 2023 annual meeting, Ms. Long was granted her new director restricted stock award in September 2023, which award vests in equal installments on each of October 5, 2024, 2025 and 2026. Mr. Votel was granted his new director restricted stock award in December 2023 in connection with his commencement of service on the board, which award vests in equal installments on each of January 4, 2025,

2026 and 2027. Mr. Davidson was granted his new director restricted stock award in June 2023 in connection with his commencement of service on the board, which award vests in equal installments on each of July 11, 2024, 2025 and 2026

The award agreements evidencing stock options and restricted stock awards issued to our non-employee directors provide for the acceleration of vesting and exercisability of all company stock options and restricted stock awards held by the director upon the completion of a change in control.

Fiscal Year 2024 Non-Employee Director Compensation Table

The following table identifies the compensation paid during fiscal year 2024 to each person who served as a non-employee director during fiscal year 2024.

Name	Fees Earned or Paid in Cash ($)	Stock Awards1 ($)	All Other Compensation ($)	Total ($)
Charles Thomas Burbage	80,000	149,942	—	229,942
Catharine Merigold2	38,500	149,942	—	188,442
Cindy K. Lewis	70,000	149,942	—	219,942
Edward R. Muller	107,000	149,942	—	256,942
Stephen F. Page	80,000	149,942	—	229,942
Philip Davidson	56,359	169,989	—	226,348
Mary Beth Long	39,326	169,972	—	209,208
Joseph L. Votel	25,435	169,964	—	195,399

The value of the restricted stock awards granted during fiscal year 2024 equals their grant date fair value as computed in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”), Topic 718. For additional information regarding the valuation assumptions used in the calculation of these amounts, refer to Notes 13 and 14 to the financial statements included in our annual report on Form 10-K for our fiscal year ended April 30, 2024, as filed with the SEC.

Ms. Merigold elected to not sit for reelection to the board and ceased serving as a director at the 2023 annual meeting of stockholders on September 29, 2023. Ms. Merigold is currently a consultant for the company, but did not receive any consulting compensation during fiscal year 2024.

None of the non-employee members of our board who served on the board during fiscal year 2024 held unexercised options as of April 30, 2024.

The non-employee members of our board who served on the board during fiscal year 2024, held the following aggregate number of shares of unvested restricted stock as of April 30, 2024:

Name	Number of Securities Underlying Unvested Restricted Stock
Charles Thomas Burbage		2,918
Catharine Merigold1		2,918
Cindy K. Lewis		3,114
Edward R. Muller		2,918
Stephen F. Page		2,918
Philip Davidson		1,662
Mary Beth Long		1,524
Joseph L. Votel		1,362

Ms. Merigold ceased serving as a director on September 29, 2023, however, she remained a consultant to the company after her service as a director ceased and, therefore, the unvested restricted stock she held as of the cessation of her director service remained outstanding.

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DIRECTOR COMPENSATION

The following table provides a breakdown of fees earned or paid in cash during fiscal year 2024.

Name	Annual Retainers ($)	Chairman of the Board, Lead Independent Director and Committee Chair Retainer Fees ($)	Committee Member Retainer Fees ($)	Total Fees ($)
Charles Thomas Burbage	60,000	15,000	5,000	80,000
Catharine Merigold1	30,000	—	8,500	38,500
Cindy K. Lewis	60,000	—	10,000	70,000
Edward R. Muller	60,000	40,000	7,000	107,000
Stephen F. Page	60,000	10,000	10,000	80,000
Philip Davidson	51,359	—	5,000	56,359
Mary Beth Long	35,826	—	3,500	39,326
Joseph L. Votel	25,435	—	—	25,435

Ms. Merigold elected to not sit for reelection to the board and ceased serving as a director at the 2023 annual meeting of stockholders on September 29, 2023.

Compensation Policies Applicable to Non-Employee Directors

Annual Limits on Director Compensation

We have adopted annual limits on the amount of compensation that any individual non-employee director may receive for service on our board of directors. Under the 2021 Equity Incentive Plan, the sum of any cash compensation, other compensation and equity awards granted to a non-employee director as compensation for services on our board during any fiscal year may not exceed $500,000 (or $700,000 for the director’s initial year of service). The board of directors may make exceptions to this limit in extraordinary circumstances, provided that the director receiving the additional compensation may not participate in the decision to award such additional compensation.

Stock Ownership Guidelines for Non-Employee Directors

Our board of directors has adopted stock ownership guidelines for our non-employee directors. Pursuant to

the guidelines, as amended by the board of directors in September 2022, each non-employee director is expected to own shares of the company’s common stock with a market value of no less than five times his or her current annual cash retainer for serving as a member of the board of directors, exclusive of chairperson, committee or meeting fees, within five years of the date on which such person was appointed to the board. The company determines progress toward meeting the applicable ownership thresholds and ongoing compliance with the guidelines on the last day of each fiscal year.

The table below shows each non-employee director’s equity ownership in the company as a multiple of his or her cash retainer and the minimum ownership level required of the guidelines in effect on April 30, 2024 pursuant to these guidelines for each of our non-employee directors serving in such capacity as of April 30, 2024.

Name	Dollar Value of Equity Ownership as a Multiple of Annual Retainer ($)1	Minimum Ownership Level Required as a Multiple of Annual Retainer
Stephen F. Page	139.0x	5x
Edward R. Muller	132.3x	5x
Charles Thomas Burbage	130.7x	5x
Cindy K. Lewis	13.0x	5x
Philip Davidson2	4.4x	5x
Mary Beth Long3	4.1x	5x
Joseph L. Votel4	3.6x	5x

For each non-employee director, calculated by dividing (a) the aggregate number of shares of vested and unvested common stock held by such non-employee director, multiplied by the closing price of $159.79 per share of our common stock on April 30, 2024,

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DIRECTOR COMPENSATION

the last trading day of fiscal year 2024, by (b) the annual retainer paid to such non-employee director (excluding any annual cash retainer for committee membership or chairmanship or service as lead independent director).

Mr. Davidson was appointed to the Board in June 2023, and therefore has until June 2028 to achieve the minimum ownership level under the company’s Stock Ownership Guidelines.

Ms. Long was elected to the Board in September 2023 at the Annual Shareholder meeting, and therefore has until September 2028 to achieve the minimum ownership level under the company’s Stock Ownership Guidelines.

Mr. Votel was appointed to the Board in November 2023, and therefore has until November 2028 to achieve the minimum ownership level under the company’s Stock Ownership Guidelines.

Post-Vesting Stock Retention Guidelines

The company has adopted post-vesting stock retention guidelines, which require non-employee directors to hold 50% of net after-tax shares issued upon the vesting of equity awards until their required stock ownership levels are achieved.

Insider Trading and Anti-Hedging and Anti-Pledging Policies

The company’s insider trading policies contain stringent restrictions on transactions in company stock by non-employee directors. All trades by non-employee directors must be pre-cleared. Furthermore, no

member of our board of directors may use any strategies or products (including derivative securities, such as put or call options, or short-selling techniques) to hedge against potential changes in the value of our common stock. Additionally, no non-employee director may pledge shares of our stock as collateral for a loan or hold any shares of our common stock in a margin account. Stock ownership and retention guidelines and anti-hedging and anti-pledging policies for our executive officers, including Mr. Nawabi, are described below under “Executive Compensation and Other Information — Compensation Discussion and Analysis — Stock Ownership Guidelines for Executive Officers.

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RELATED PARTY TRANSACTIONS

Certain Transactions and Relationships

Review and Approval of Related Party Transactions. All transactions and relationships in which the company and our directors, director nominees and executive officers or their immediate family members are participants are reviewed by our Audit Committee or another independent body of the board of directors, such as the independent and disinterested members of the board. As set forth in the Audit Committee charter, the members of the Audit Committee, all of whom are independent directors, review and approve related party transactions for which such approval is required under applicable law, including SEC and Nasdaq rules. In the course of its review and approval or ratification of a disclosable related party transaction, the Audit Committee or the independent and disinterested members of the board may consider:

•

the nature of the related person’s interest in the transaction;

•

the material terms of the transaction, including, without limitation, the amount and type of transaction;

•

the importance of the transaction to the related person;

•

the importance of the transaction to the company;

•

whether the transaction would impair the judgment of a director or executive officer to act in the best interest of the company; and

•

any other matters the Audit Committee deems appropriate.

Reportable Related Party Transactions. Other than the employment arrangements described elsewhere in this proxy statement, since May 1, 2023, there has not been, nor is there currently proposed, any transaction or series of similar transactions to which we were or will be a party in which:

•

the amount involved exceeded or will exceed $120,000; and

•

a director, director nominee, executive officer, holder of five percent or more of any class of our capital stock or any member of his or her immediate family had or will have a direct or indirect material interest.

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EXECUTIVE OFFICERS

The following table sets forth certain information as of August [•], 2024 about our executive officers.

Name	Age	Position
Wahid Nawabi1	55	Chair, President and Chief Executive Officer
Kevin McDonnell	62	Senior Vice President and Chief Financial Officer
Melissa Brown	47	Senior Vice President, General Counsel, Chief Compliance Officer and Corporate Secretary
Brett Hush	61	Senior Vice President, Loitering Munitions
Jeff Rodrian	45	Senior Vice President, MacCready Works
Trace Stevenson	48	Senior Vice President, UnCrewed Systems

The background and experience of Mr. Nawabi is detailed on page 17.

Kevin McDonnell was appointed our Senior Vice President and Chief Financial Officer on February 10, 2020. Before joining the company, Mr. McDonnell served as Senior Vice President, Chief Financial Officer of JAMS, Inc., which provides alternative dispute resolution services, from September 2014 to February 2020. Prior to joining JAMS, Inc., Mr. McDonnell served in a variety of management and finance roles including as the co-founder of DoubleBeam, Inc., a provider of mobile retail solutions, from 2011 to 2014, the Chief Financial and Administrative Officer of Orange County Container Group LLC, a manufacturer of paperboard and paper-based packaging, from 2008 to 2011, the Executive Vice President, Finance and Administration, and Chief Financial Officer for Leiner Health Products from 2006 to 2008 and the Senior Vice President, Finance and Administration, and Chief Financial Officer for Memorex Corporation from 2004 to 2006. Mr. McDonnell previously held financial leadership positions with Digital Insight, Printrak, Teradata and Mattel. Mr. McDonnell serves as a director of our wholly-owned subsidiaries Arcturus UAV, Inc. and Tomahawk Robotics, Inc. Mr. McDonnell holds a B.A. in Business Administration from Loyola Marymount University and a J.D. from Loyola Law School.

Melissa Brown has served as our Senior Vice President, General Counsel, Chief Compliance Officer, and Corporate Secretary since May 2023. She began serving as our Chief Compliance Officer in May 2021 and served as Vice President, General Counsel and Corporate Secretary beginning in December 2016. She was appointed as our Corporate Secretary in September 2016 and previously she served as our Corporate Counsel from April 2015 to December 2016. Prior to joining the company, Ms. Brown served as an associate attorney at various law firms, including K&L Gates LLP from 2007 to 2014. Ms. Brown serves as a director of our wholly-owned subsidiaries Arcturus UAV, Inc. and Tomahawk Robotics, Inc. Ms. Brown

earned a B.S. in Microbiology and Molecular Genetics from the University of California, Los Angeles and a J.D. from Arizona State University.

Trace Stevenson has served as our Senior Vice President and General Manager, UnCrewed Systems since May 2023. Prior to that he served as Vice President and General Manager of our Small Unmanned Systems Product Line starting in February 2021. He also served as Deputy General Manager UAS from May 2015 to February 2021 and was responsible for the leadership of our Emerging Business overseeing our HAPS business where he served as a Board Member of HAPSMobile, Inc., a Joint Venture between the company and SoftBank. Mr. Stevenson has 20 years of experience in the defense industry and earned a Bachelor of Science degree in Business and Economics from the University of Kansas.

Brett Hush has served as our Senior Vice President and General Manager of Loitering Munitions since May 2023. From February 2019 to May 2023, Mr. Hush served as our Vice President, Product Line General Manager of Loitering Munitions. Mr. Hush joined AeroVironment in 2010 and served as Vice President of Switchblade until February 2019. Prior to joining AeroVironment, Mr. Hush was a Vice President at Teledyne Technologies. With a combined 35 years in the defense industry, Mr. Hush has also held various leadership roles at GE Aircraft Controls, Martin Marietta, Lockheed Martin, and BAE Systems. Mr. Hush holds a Bachelor of Science degree in Electrical Engineering from Clarkson University and a Masters of Science in Electrical Engineering from Syracuse University and is a graduate of General Electric’s Advanced Course in Engineering Program and GE’s Edison Engineering Development Program.

Jeff Rodrian has served as the Senior Vice President of MacCready Works since May 2023. From October 2020 to May 2023, he served as Senior

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EXECUTIVE OFFICERS

Director of AV Ventures. Mr. Rodrian first joined the company in 2010 as a Product Manager and held various positions at the company of increasing responsibility, before leaving in January 2020 to form Aireus, a sole proprietorship focused on developing disruptive technologies for the aerospace industry. Mr. Rodrian rejoined the company in October 2020.

Prior to joining AeroVironment in 2010, Mr. Rodrian spent several years at start-ups focused on aerospace innovation for unmanned systems and commercial aircraft. Mr. Rodrian earned an MBA from the University of Michigan Ross School of Business and a Bachelor and Master of Science in Aeronautics and Astronautics from Purdue University.

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SHARE OWNERSHIP

Ownership of Equity Securities of the Company

The following table presents information regarding the beneficial ownership of our common stock as of August [•], 2024, by:

•

our Named Executive Officers (as defined below);

•

our current directors and director nominees;

•

all of our directors and executive officers as a group; and

•

each stockholder known by us to be the beneficial owner of more than 5% of our common stock.

Beneficial ownership is determined in accordance with the rules of the SEC and generally includes voting or investment power with respect to securities. Unless otherwise indicated below, to our knowledge, the persons and entities named in the table have sole voting and sole investment power with respect to all

shares beneficially owned, subject to community property laws where applicable. Shares of our common stock subject to options that are currently exercisable or exercisable within 60 days of August [•], 2024 are deemed to be outstanding and to be beneficially owned by the person holding the options for the purpose of computing the percentage ownership of that person but are not treated as outstanding for the purpose of computing the percentage ownership of any other person.

The information presented in this table is based on [•] shares of our common stock outstanding on August [•], 2024. Except as set forth in the footnotes below, the address of each beneficial owner listed on the table is c/o AeroVironment, Inc., 241 18th Street South, Suite 650, Arlington, VA 22202.

Name of Beneficial Owner	Number of Shares Beneficially Owned	Percentage of Shares Outstanding
5% Stockholders
BlackRock, Inc.1	4,497,982	[•]%
The Vanguard Group2	2,915,436	[•]%
State Street Corporation3	1,669,443	[•]%
American Capital Management, Inc.4	1,340,752	[•]%
Named Executive Officers, and Directors and Director Nominees:
Wahid Nawabi5	144,397	*
Kevin McDonnell	19,163	*
Melissa Brown	14,152	*
Trace Stevenson	3,762	*
Brett Hush	4,797	*
Charles Thomas Burbage	49,978	*
Philip S. Davidson	2,572	*
Cindy K. Lewis	5,807	*
Joseph Votel	2,272	*
Edward R. Muller6	50,601	*
Stephen F. Page7	54,907	*
Mary Beth Long	2,434	*
Current Directors and Executive Officers as a Group (13 persons)	357,525	[•]%

Less than 1%.

Based solely on a Schedule 13G/A filed by BlackRock, Inc. on January 22, 2024 with the SEC reporting beneficial ownership as of December 31, 2023. The address of BlackRock, Inc. is 50 Hudson Yards, New York, NY 10001.

Based solely on a Schedule 13G/A filed by The Vanguard Group on February 13, 2024 with the SEC reporting beneficial ownership as of December 29, 2023. The address of The Vanguard Group is 100 Vanguard Boulevard, Malvern, PA 19355.

Based solely on a Schedule 13G/A filed by State Street Corporation on January 25, 2024 with the SEC reporting beneficial ownership as of December 31, 2023. The address of State Street Corporation is 1 Congress St., Suite 1, Boston, MA 02114.

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SHARE OWNERSHIP

Based on the Schedule 13G/A filed with the filed by American Capital Management, Inc. on February 14, 2024 with the SEC reporting beneficial ownership as of December 31, 2023. The address of American Capital Management, Inc. is 575 Lexington Avenue, 30th Floor, New York, NY 10022.

Includes 50,000 shares of our common stock reserved for issuance upon exercise of stock options which currently are exercisable.

Includes 47,400 shares held by the Edward R. Muller and Patricia E. Bauer 1991 Family Trust, of which Mr. Muller is one of the two trustees and with respect to which he shares investment authority with the other trustee, and 810 shares held by the Edward R. Muller IRA.

Includes 20,795 shares held by the Stephen F. Page Living Trust, of which Mr. Page is the trustee.

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DELINQUENT SECTION 16(a) REPORTS

Section 16(a) of the Exchange Act requires that our officers and directors, and persons who own more than ten percent of a registered class of our equity securities, file reports of ownership and changes in ownership with the SEC. Officers, directors and greater-than-ten percent stockholders are required by SEC regulations to furnish us with all Section 16(a) forms

they file. Based solely on our review of the copies of the forms received by us and written representations from certain reporting persons that they have complied with the relevant filing requirements, we believe that, during the fiscal year ended April 30, 2024, all of our officers, directors and greater-than-ten percent stockholders complied with all Section 16(a) filing requirements.

EQUITY COMPENSATION PLAN
INFORMATION

The following table provides information as of April 30, 2024 about our common stock that may be issued, whether upon the exercise of options, warrants and rights or otherwise, under our existing equity compensation plans and employee stock purchase plan.

	(a)	(b)	(c)
Plan category	Number of securities to be issued upon exercise of outstanding options, warrants and rights1	Weighted-average exercise price of outstanding options, warrants and rights	Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a))
Equity compensation plans approved by security holders	66,1641	$27.82	1,504,949
Equity compensation plans not approved by security holders	—	—	—
Total	66,1641	$27.82	1,504,9492

Consists of awards outstanding under the AeroVironment, Inc. 2021 Equity Incentive Plan and the AeroVironment, Inc. Amended and Restated 2006 Equity Incentive Plan. As of July 10, 2021, no additional awards may be granted under the AeroVironment, Inc. Amended and Restated 2006 Equity Incentive Plan.

Includes 504,949 shares remaining available for issuance under the AeroVironment, Inc. 2021 Equity Incentive Plan and 1,000,000 shares remaining available for issuance under the AeroVironment, Inc. 2023 Employee Stock Purchase Plan. As of April 30, 2024, the company had not implemented any offerings under the AeroVironment, Inc. 2023 Employee Stock Purchase Plan.

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EXECUTIVE COMPENSATION AND OTHER INFORMATION

Compensation Committee Report

The Compensation Committee of our board of directors is primarily responsible for determining the annual salaries and other compensation of our executive officers and administering our equity compensation plans. The Compensation Committee has reviewed and discussed with management the following Compensation Discussion and Analysis of the 2024 proxy statement. Based on such review and discussions, the Compensation Committee recommended to the board that the Compensation Discussion and Analysis be included in our annual report filed on Form 10-K and this proxy statement.

Compensation Committee:
Charles Thomas Burbage (Chairman)
Mary Beth Long
Edward R. Muller

Compensation Discussion and Analysis

This Compensation Discussion and Analysis provides information about the material components of our executive compensation program for:

•

Wahid Nawabi, our President and Chief Executive Officer;

•

Kevin McDonnell, our Senior Vice President and Chief Financial Officer;

•

Melissa Brown, our Senior Vice President, General Counsel, Chief Compliance Officer and Corporate Secretary; and

•

Trace Stevenson, Senior Vice President, UnCrewed Systems

•

Brett Hush, Senior Vice President, Loitering Munitions

We refer to these executive officers collectively in this Compensation Discussion and Analysis as the “Named Executive Officers.” Specifically, this Compensation Discussion and Analysis provides an overview of our executive compensation philosophy, the overall objectives of our executive compensation program, and each compensation component that we provide. In addition, we explain how and why the Compensation Committee arrived at specific compensation policies and decisions involving our Named Executive Officers during fiscal year 2024.

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EXECUTIVE COMPENSATION AND OTHER INFORMATION

Executive Summary

Our executive compensation program is designed to support our business goals and objectives by providing a link between the total compensation for our executive officers, including the Named Executive Officers, and the creation of long-term stockholder value. The Compensation Committee reviews our executive compensation program on an annual basis to ensure that it is consistent with such objectives. In line with this philosophy, compensation awarded to our Named Executive Officers for fiscal year 2024 reflected our financial and strategic results and overall compensation philosophy.

Key Performance Indicators During Fiscal Year 2024

For fiscal year 2024, revenue, annual bookings and adjusted EBIDTA were the financial metrics used by the Compensation Committee to evaluate our financial performance under the company’s executive compensation program. Our consolidated performance for fiscal year 2024 for these metrics, relative to fiscal year 2023 consolidated performance, is reflected in the table below.

Financial Measure	Fiscal Year 2024 ($, in millions)	Fiscal Year 2023 ($, in millions)	Increase (decrease) (%)
Revenue	716.7	540.5	32.6
Annual Bookings1	677.5	752.3	(9.9)
Adjusted EBITDA2	127.8	90.0	42.0

Annual bookings are firm orders for products and services for which funding has been appropriated to us under an executed contract during the fiscal year. Annual bookings excludes the value of the unfunded portion on order amounts under cost-reimbursable and fixed price contracts such as (i) multiple one-year options, and indefinite delivery, indefinite quantity, or IDIQ contracts, or (ii) incremental funded contracts.

Adjusted EBITDA means the company’s earnings (as calculated in accordance with generally accepted accounting principles (“GAAP”)), before interest, taxes, depreciation and amortization, excluding any acquisition-related deal & integration costs, equity method investments and stock-based compensation expenses. Adjusted EBITDA is a non-GAAP measure. An itemized reconciliation between net income (loss) and adjusted EBITDA (unaudited) for fiscal years 2024 and 2023 is set forth below:

	Fiscal Year 2024 ($, in millions)	Fiscal Year 2023 ($, in millions)
Net income (loss)	59.7	(176.2)
Interest expense, net	4.2	9.4
Provision for (benefit from) income taxes	1.9	(14.7)
Depreciation and amortization	35.7	100.0
EBITDA (Non-GAAP)	101.5	(81.5)
Amortization of purchase accounting adjustment included in loss on disposal of property and equipment	—	0.2
Amortization of cloud computing arrangement implementation	1.5	0.5
Stock-based compensation	17.1	10.8
Equity method and equity securities investments activity, net	5.6	2.6
Acquisition-related expenses	2.1	1.4
Goodwill impairment	—	156.0
Adjusted EBITDA (Non-GAAP)	127.8	90.0

We delivered both strong financial performance and other significant results during fiscal 2024, including:

•

Secured numerous awards under U.S. DoD programs of record, including the U.S. Army’s Low Altitude Stalking and Strike Ordinance (“LASSO”) program, the U.S. DoD’s Replicator initiative, and the

U.S. Marine Corp’s Organic Precision Fires-Light (OPF-L) program.

•

Delivered record annual revenue of $716.7 million, up 32.6% percent year-over-year; and record quarterly revenue of $197.0 million in our fourth quarter;

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EXECUTIVE COMPENSATION AND OTHER INFORMATION

•

Produced record full year revenue and profitability, marking our seventh consecutive year of top-line growth;

•

Generated full fiscal year diluted earnings per share of $2.18 per share; and

•

Successfully completed the acquisition of Tomahawk Robotics, Inc. in September 2023.

For fiscal year 2024, we included fourteen strategic objectives as components in our fiscal year 2024 bonus plan tied to each of our product lines and internal company goals, which included objectives such as receiving orders from certain customers, receiving

orders for new products, meeting development milestones for new products, obtaining new development program contracts, meeting free cash flow and inventory turn goals and completing certain critical internal infrastructure projects. Also included within those strategic objectives was an ESG component to further our ESG priorities.

Based on our performance relative to the metrics established by our Compensation Committee for annual bonus plan purposes in fiscal year 2024, our Named Executive Officers received payouts of their annual cash bonuses above target amounts established for our fiscal year 2024 bonus plan.

Summary of Executive Compensation Best Practices

Our executive compensation program is governed by policies and practices that are intended to align with industry practices and stockholder interests.

	Best Practices We Maintain
	✓			Majority of total potential compensation paid to executives based on our financial and company performance
	✓			Compensation recovery (or “clawback”) policy for the recoupment of incentive compensation of executive officers
	✓			Anti-hedging, anti-pledging and anti-short sale policies for all employees, including executives
	✓			Limited perquisites
	✓			Retention of independent compensation consultant
	✓			Annual risk assessment of compensation practices
	✓			Stock ownership guidelines requiring ownership of company stock by our Chief Executive Officer of 4x his base salary and by other Named Executive Officers of 2x their base salaries
	✓			Post-vesting stock retention guidelines requiring Named Executive Officers to hold 50% of net after-tax shares issued upon the vesting of equity awards until their required stock ownership levels are achieved

	Practices We Avoid
	✘			No automatic or guaranteed annual base salary increases
	✘			No employment agreements with executive officers
	✘			No executive pensions
	✘			No single-trigger benefits upon change in control under our Severance Plan
	✘			No excise tax gross-up payments upon a termination after a change in control
	✘			No repricing or exchange of “underwater” stock options without stockholder approval
	✘			No minimum guaranteed vesting for performance-based equity awards
	✘			No counting of outstanding performance-based restricted stock units or in-the-money options when determining whether share ownership guidelines have been met

Key Fiscal Year 2024 Compensation Determinations

During fiscal year 2024, the Compensation Committee made the following compensation decisions:

•

Base Salary Increases: For fiscal year 2024, all Named Executive Officers received a base salary increase based on the executive officer’s position and responsibilities, tenure with the company, individual and organizational performance, and internal pay equity.

•

Continued Emphasis on Performance-Based Compensation: In fiscal year 2024, the Compensation Committee continued its practice of awarding the majority of total target compensation to the Named Executive Officers in the form of performance-based compensation. This emphasis on performance-based compensation is intended to align executive compensation with stockholder interests.

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EXECUTIVE COMPENSATION AND OTHER INFORMATION

•

Above Target Achievement of Fiscal Year 2024 Annual Bonus Awards. As noted above, for fiscal year 2024, our executive annual cash bonus plan was tied primarily to the achievement of pre-established financial objectives related to revenue, annual bookings and adjusted EBIDTA for such period. Our bonus plan also included fourteen strategic objectives tied to the achievement of various strategic initiatives in each of our product lines, achieving internal company goals and an ESG component. As described below in further detail, we achieved 115.6%, 94.1%, and 121.7% of target achievement with respect to our revenue, annual bookings and adjusted EBIDTA objectives, respectively. Based on our achievement of the financial objectives, strategic objectives and ESG component for fiscal year 2024, each of our Named Executive Officers participating in the company’s executive officer bonus plan was awarded an annual performance bonus equal to 116.7% of his or her targeted bonus amount. In addition to amounts earned under the fiscal year 2024 executive bonus plan, each Named Executive Officer was awarded an additional discretionary cash bonus in recognition of the company’s outstanding performance during fiscal year 2024, as further described below in the Summary Compensation table.

•

Continued Use of Long-Term Incentive Compensation Program. The company’s long-term incentive compensation program consists of a mix of performance-based restricted stock unit awards (“PRSUs”), which vest based on the company’s achievement of specified financial metrics over a three-year performance period, and restricted stock awards, which vest in equal annual installments over a three-year vesting period. If financial objectives associated with the awards are achieved, the PRSUs will settle in fully-vested shares of our common stock. In June 2023, the Compensation Committee granted time-based restricted stock awards and PRSUs to the Named Executive Officers with specified financial objectives for the cumulative three-year performance cycle comprising fiscal years 2024, 2025 and 2026.

•

Below Target Payouts under PRSUs for Fiscal Year 2022 — Fiscal Year 2024 Performance Period. In June 2024, the Compensation Committee determined that the PRSUs for the three-year performance period comprising fiscal years 2022-2024 would be paid out at 67.5% of the applicable target for such awards based on the company’s financial performance over the performance period and our achievement relative to the financial metrics associated with such awards for the performance period.

Objectives of Our Executive Compensation Program

Our executive compensation program is designed to support our business goals and objectives by providing a link between the total compensation opportunities for our executive officers, including the Named Executive Officers, and the creation of long-term stockholder value. Specifically, our executive compensation program is designed to:

•

Attract, motivate and retain superior talent;

•

Ensure that compensation is commensurate with the company’s performance and stockholder returns;

•

Provide performance awards for the achievement of financial and strategic objectives that are important to our long-term growth; and

•

Ensure that our executive officers have financial incentives to achieve growth in stockholder value.

Our compensation program is designed to achieve these objectives through a combination of the following types of compensation: base salary; annual cash incentive bonus awards; performance-based restricted stock units that will settle in fully-vested shares of common stock for multi-year performance periods, restricted stock awards subject to time-based vesting over a multi-year period; and other employee benefits. Each of these compensation components serve our interests in different ways and together represent a comprehensive pay package that can reward both the short-term and long-term performance of the company and each individual Named Executive Officer. A majority of the compensation provided to the Named Executive Officers is based on our performance, which helps align the interests of our executive officers with those of stockholders in achieving long-term financial goals for our company. Each element of our executive compensation program is discussed in greater detail below.

The Compensation Committee does not affirmatively set out in any given year, or with respect to any given executive, to apportion compensation in any specific ratio among the various categories of compensation (i.e., cash and non-cash compensation, between short-term and long-term compensation, or between non-performance-based and performance-based compensation). Rather, the Compensation Committee uses the principles described above, and the factors described for each category in the discussion that follows, as a guide in assessing the proper allocation among those categories.

Compensation-Setting Process

The Compensation Committee is responsible for overseeing our executive compensation program, as

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EXECUTIVE COMPENSATION AND OTHER INFORMATION

well as determining and approving the ongoing compensation arrangements for our executive officers, including the non-CEO Named Executive Officers. The Compensation Committee reviews and recommends for approval to our full board of directors the compensation of our Chairman, President and Chief Executive Officer.

Generally, annual base salary adjustments for our executive officers are determined within the first quarter of each fiscal year. Annual cash bonus payouts are made within 75 days of our fiscal year end to synchronize award determinations with the conclusion of our fiscal year and the review of fiscal year financial results. Historically, long-term incentive awards have been made at the discretion of the Compensation Committee. Compensation adjustments in connection with changes in duties and/or other material changes in the primary assumptions forming the basis of a compensation decision will continue to be made as required by circumstances throughout the fiscal year.

Role of Our Chief Executive Officer

Typically, our Chief Executive Officer makes recommendations to the Compensation Committee regarding the compensation of our executive officers (except with respect to his own compensation), including base salary levels, target annual cash bonus opportunities, long-term incentive performance compensation levels and equity awards, with the assistance of our people and culture and finance departments. Our Chief Executive Officer also provides recommendations for the corporate financial objectives and strategic objectives used in our annual cash bonus plan and long-term incentive compensation program. He supports his recommendations with competitive market data developed by our people and culture department, with information provided by the Compensation Committee’s independent compensation consultant, and by reviewing the historical performance of each executive officer with the Compensation Committee. Although the Compensation Committee carefully considers the recommendations of our Chief Executive Officer when determining the compensation of our executive officers, it bases its decisions on the collective judgment of its members after considering the input of its independent compensation consultant and any relevant supporting data.

While our Chief Executive Officer generally attends meetings of the Compensation Committee, the committee meets outside the presence of our Chief Executive Officer when discussing his compensation.

Decisions regarding non-CEO executive officers’ compensation are made by the Compensation Committee. The Compensation Committee

recommends the compensation of our Chief Executive Officer to our board of directors for approval.

The Compensation Committee may delegate and grant authority to our Chief Executive Officer and/or a committee of executive officers to grant equity awards under the company’s equity incentive plan to the employees holding positions below the level of Vice President.

Role of Compensation Consultant

The Compensation Committee is authorized to retain the services of executive compensation advisors, as it sees fit, in connection with its oversight of our executive compensation program. In fiscal year 2024, the Compensation Committee engaged Pay Governance, a national compensation consulting firm, to provide executive compensation advisory services, including an executive officer compensation assessment.

The Compensation Committee considered the independence of Pay Governance consistent with the requirements of Nasdaq Listing Rule 5605(a)(2). Further, as required under Item 407(e)(3) of Regulation S-K, the Compensation Committee conducted a conflicts of interest assessment and determined that there is no conflict of interest resulting from retaining Pay Governance. The Compensation Committee intends to reassess the independence of its compensation advisors at least annually.

Competitive Market Data

Each year, the Compensation Committee reviews the executive compensation practices of a group of companies in relevant industry sectors determined to be comparable to us based on their business size and public company status. In June 2023, with the assistance of Pay Governance, the Compensation Committee approved the following group of peer companies to include in a competitive market analysis of executive officer compensation for the company’s fiscal year 2024:

ADTRAN, Inc.
Aerojet Rocketdyne Holdings, Inc.
Ambarella, Inc.
Astronics Corporation
Axon Enterprise, Inc.
Casa Systems, Inc.
Digi International, Inc.
Ducommun Incorporated
EchoStar Corporation
iRobot Corporation
Kaman Corporation
Kratos Defense & Security Solutions, Inc.
Mercury Systems, Inc.
nLIGHT, Inc.
QinetiQ Group plc
Iridium Communications, Inc.

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EXECUTIVE COMPENSATION AND OTHER INFORMATION

One new company, Iridium Communications, Inc., was added to our peer group for fiscal year 2024. The specific companies were from relevant industries and within a range of company scope (primarily revenue and market capitalization) that we believe is appropriate for benchmarking executive compensation. The Compensation Committee reviews the peer group each year to ensure the group is sufficiently robust to produce meaningful compensation data for executive compensation evaluation purposes. We believe the peer group includes companies with which we compete for business, executive talent and/or investment dollars.

After identifying our peer group, the Compensation Committee’s independent compensation consultant conducts a compensation analysis of the peer group to assess the competitiveness of our compensation levels. Where proxy data is not available, survey data for companies of comparable scope to the peer company are used.

We believe that by utilizing publicly available peer group data, we are able to develop an appropriate set of competitive data for use in making compensation decisions. The Compensation Committee uses the information derived from this review in two ways: to assist it in determining the appropriate level and reasonableness of total compensation, as well as each separate component of compensation, for our executive officers and to ensure that the compensation we offer to them is competitive and fair.

The Compensation Committee does not establish compensation levels based directly on benchmarking, although, it does target a Named Executive Officer’s overall target compensation to the market median. The Compensation Committee relies on the judgment of its members in making compensation decisions regarding base salaries, target bonus levels and long-term equity incentive awards. In addition to competitive market data, in making its compensation decisions, the Compensation Committee also considers an executive officer’s position, tenure with the company, individual and organizational performance, our retention needs, and internal pay equity. The Compensation Committee does not guarantee that any executive will receive a specific market-derived compensation level.

Executive Compensation Program Components

The following describes each component of our executive compensation program, the rationale for each, and how compensation amounts are determined.

Base Salary

We use base salaries to provide our executive officers, including the Named Executive Officers, with a fixed amount of compensation for their regular work. The Compensation Committee generally reviews the base salaries of our executive officers at the beginning of each fiscal year, as well as in connection with promotions or other changes in responsibilities. Base salary adjustments generally go into effect within the first quarter of each fiscal year. Base salary adjustments are based on an evaluation of peer company data provided by the Compensation Committee’s independent compensation consultant, an executive officer’s position, tenure with our company, experience with other companies, individual and organizational performance, our retention needs, and internal pay equity.

The Compensation Committee has adopted a general approach of compensating our executive officers with base salaries commensurate with the experience and expertise of the individual executive and competitive with the median base salaries of executives holding comparable positions among our peer group. The Compensation Committee will take into account the base salaries of comparable executives in our peer group in setting base salaries for our executive officers and may approve increases in base salaries of the relevant executive officers to move them closer to the median of our peer group data for their positions, although such approved base salaries may remain below the median.

In light of the considerations discussed above, for fiscal year 2024, the Compensation Committee determined to increase the base salaries of our Named Executive Officers, as shown below: