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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 ý
Filed by a Party other than the Registrant o
Check the appropriate box:
o		Preliminary Proxy Statement
o		Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
ý		Definitive Proxy Statement
o		Definitive Additional Materials
o		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):
ý	No Fee Required
o	Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
	(1)	Title of each class of securities to which transaction applies:
	(2)	Aggregate number of securities to which transaction applies:
	(3)	Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11:
	(4)	Proposed maximum aggregate value of transaction:
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o	Fee paid with preliminary materials:
o	Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.
	(1)	Amount Previously Paid:
	(2)	Form, Schedule or Registration Statement No.:
	(3)	Filing Party:
	(4)	Date Filed:

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Notice of 2019 Annual Meeting

of Stockholders

and Proxy Statement

Friday, September 27, 2019
at 9:00 a.m., Pacific Time
994 Innovators Way
Simi Valley, CA 93065

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TABLE OF CONTENTS


Q&A WITH OUR PRESIDENT AND CHIEF EXECUTIVE OFFICER

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS		1

PROXY SUMMARY		3



Proposal 1 – Election of Nominees to the Board of Directors		7
Director Qualifications and Independence		9
2019 Nominees for Class I Directors		11
Summary of Director Nominees		20
Corporate Governance		22
Director Compensation		28
Related Party Transactions		32
Executive Officers		33
SHARE OWNERSHIP		34

Ownership of Equity Securities of the Company		34
Section 16(a) Beneficial Ownership Reporting Compliance		36
Equity Compensation Plan Information		36


EXECUTIVE COMPENSATION AND OTHER INFORMATION		37

Compensation Committee Report		37
Compensation Discussion and Analysis		37
Executive Compensation Tables		53
AUDIT MATTERS		62

Audit Committee Report		62
Proposal 2 – Ratification of Selection of Deloitte & Touche LLP as Our Independent Registered Public Account Firm		63
Proposal 3 – Advisory Vote on the Compensation of our Named Executive Officers		65

QUESTIONS AND ANSWERS ABOUT ANNUAL MEETING AND VOTING		67

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

The AeroVironment team delivered strong financial and strategic results in fiscal year 2019. By executing our plan, we delivered a second consecutive year of double-digit revenue growth and also produced strong profits, while making significant progress toward achieving our long-term value creation goals. Our small unmanned aircraft systems (UAS) remain the leading solutions for the United States Department of Defense and more than 45 allied defense forces from every populated continent. To support our growth, we opened our first engineering center outside of California to expand our capacity and capabilities. Still within our core U.S. defense market, strong federal government funding supports multi-year demand for Switchblade procurement, while we are also developing a larger variant that provides access to a larger segment of the legacy missile market. Beyond our defense markets, we assembled and rolled-out our first HAWK30 solar High-Altitude Pseudo-Satellite (HAPS) system for our HAPSMobile Inc. joint venture with SoftBank Corp. and are onto the next phase of the program and remain focused on advancing the program successfully. The commercial market for our innovative Quantix and AVDSS automated drone-information solution remains in a very early stage of adoption and we are gating investments accordingly. We are also deploying our balance sheet to fund strategic opportunities. We continue to focus on executing our strategy and generating long-term growth to benefit all our stakeholders.

I regularly meet and communicate with our stockholders and would like to share some of the common questions they pose to us:

Q) Why are you increasing your strategic investments?

A) Our strong balance sheet provides the flexibility and wherewithal to invest strategically to support our growth strategy, while demonstrating the firm financial foundation customers and partners seek when considering doing business with us. We have invested strategically in our HAPSMobile joint venture, and early in fiscal year 2020 we announced the acquisition of an innovative company in Kansas that manufactures a line of vertical take-off and landing (VTOL) small unmanned aircraft systems. Strategic investments also include research and development, sustaining engineering and licensing opportunities that support our business strategy. Our management team and board will remain disciplined in deploying shareholders' capital to fund high-return, value-creating opportunities, and will continue to prioritize maintaining a strong capital structure.

Q) Is increasing competition affecting your core unmanned aircraft systems business?

A) AeroVironment remains the leading supplier of small UAS to the United States Department of Defense. Our competitive success beyond the U.S. is illustrated by the more than 45 allied nations that have chosen our solutions to help their forces Proceed with Certainty. Every aspect of our core UAS business has been very competitive since our first competitive program of record award from the United States Marine Corps in 2003. We believe that our successful track record of performance, our focus, continuous innovation and deep understanding of customer needs will continue to benefit us, our customers and our stockholders as we compete for new opportunities, even if we are unable to win every single one.

Q) How can we gain a better understanding of your long-term growth prospects?

A) We are a technology solutions provider at the intersection of future-defining capabilities including robotics, sensors, analytics and connectivity, serving defense and commercial end markets. We created and lead the small UAS market for reconnaissance and the loitering munitions market for the delivery of precision effects. We are a leader in the emerging market for solar HAPS solutions and in the nascent commercial market for automated drone-information solutions. In each of these examples we pioneered, or are pioneering, an entirely new market opportunity. As a result, we remain focused on executing our plans, monitoring results and adjusting investments accordingly in order to maximize returns and long-term value creation.

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AEROVIRONMENT, INC.

NOTICE OF 2019 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 2019 annual meeting of stockholders. Important information relating to the annual meeting is detailed below:


TIME:	9:00 a.m. Pacific Time on Friday, September 27, 2019
PLACE:	The company's offices at: 994 Innovators Way Simi Valley, CA 93065
			Unanimous Recommendations of Board of Directors
ITEMS OF BUSINESS:	(1)	Elect Charles Thomas Burbage, Edward Muller and Charles Holland, each to serve as a Class I 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, 2020;	FOR
	(3)	Conduct an advisory vote on the compensation of our Named Executive Officers; and	FOR
	(4)	Transact such other business as may properly come before the annual meeting or any adjournments or postponements thereof.
RECORD DATE:	You can vote if you were a stockholder of the company at the close of business on August 9, 2019.
MEETING ADMISSION:	Registered Stockholders . If you are a registered stockholder (i.e., your shares are NOT held in an account at a brokerage firm, bank, dealer or other similar organization), you or your legal representatives attending the meeting must bring an acceptable form of identification to the meeting, such as a driver's license. Legal representatives must also bring copies of any proxy or power of attorney evidencing the legal representative's right to represent the stockholder at the meeting.

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		Beneficial Stockholders . If you are a beneficial stockholder (i.e., your shares are held by a brokerage firm, bank, dealer or similar organization (often referred to as "holding in street name")), you should come to the beneficial stockholders' table prior to the meeting. In order to be admitted, beneficial stockholders must bring account statements or letters from their brokers or banks showing that they owned company stock as of the close of business on August 9, 2019. In order to vote at the meeting, beneficial stockholders must bring legal proxies, which they can obtain only from their brokers or banks.
VOTING BY PROXY:		Registered Stockholders . To assure that your vote is recorded promptly, please vote as soon as possible, even if you plan to attend the annual meeting in person. Instructions for voting are on your proxy card. If you attend the annual meeting, you may also submit your vote in person, 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 or the advisory votes to approve the compensation of our Named Executive Officers. Please instruct your broker how to vote your shares using the voting instructions provided by your broker.
		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 2019 annual meeting of stockholders. We will begin distributing this proxy statement, a form of proxy and our 2019 annual report on or about August 27, 2019.
		Thank you for your support.

YOUR VOTE IS IMPORTANT

IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE
ANNUAL MEETING OF STOCKHOLDERS TO BE HELD ON SEPTEMBER 27, 2019

This notice, the accompanying proxy statement, and our 2019 annual report to stockholders, which includes our annual report on Form 10-K for the fiscal year ended April 30, 2019, are available on our website at http://investor.avinc.com/financial-information.

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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 of AeroVironment, Inc. for our 2019 annual meeting of stockholders to be held on Friday, September 27, 2019 and any adjournments or postponements thereof, for the purposes set forth in the attached notice of annual meeting of stockholders. Our principal executive offices are located at 900 Innovators Way, Simi Valley, California 93065. Enclosed with this proxy statement is a copy of our 2019 annual report, which includes our Form 10-K (without exhibits) for the fiscal year ended April 30, 2019. However, the 2019 annual report is not intended to be a part of this proxy statement or a solicitation of proxies.

This summary highlights information contained elsewhere in this proxy statement. This summary does not contain all of the information that you should consider and you should read the entire proxy statement before voting. For more complete information regarding the company's 2019 performance, please review our annual report on Form 10-K for the fiscal year ended April 30, 2019. This proxy statement and the accompanying proxy card are first being distributed to stockholders on or about August 27, 2019.

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 2019 annual meeting of stockholders, which will be held on Friday, September 27, 2019, at 9:00 a.m. Pacific Time, at the company's offices at 994 Innovators Way, Simi Valley, CA 93065, 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 2019 annual meeting of stockholders if you were a stockholder of record at the close of business on August 9, 2019, the record date of the meeting. On the record date, there were 23,986,931 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 2019 annual meeting of stockholders in person, please vote right away using one of the following advance voting methods (see page 69 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 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 in person at the 2019 annual meeting of stockholders. Beneficial owners may vote in person at the meeting if they have a legal proxy, as described on page 68.

Important Note about Meeting Admission Requirements: If you plan to attend the meeting in person, you should review the important details on admission requirements on page 68.

Electronic Document Delivery

Instead of receiving future copies of our notice of annual meeting, proxy statement and the annual report on Form 10-K 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 us the cost of producing and mailing documents, reduces paper waste, and also will give you an electronic link to the proxy voting site. Please see your proxy card or the website to which you are referred to vote your shares for instructions on how to elect to receive your proxy materials electronically.

Roadmap of Voting Matters

Stockholders are being asked to vote on the following matters at the 2019 annual meeting of stockholders:



						Our Board's Recommendation

		Proposal 1. Election of Directors (page 7) The board believes that the combination of qualifications, skills and experiences of the director nominees would contribute to an effective and well-functioning board. The director nominees possess 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 63) 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, 2020. 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. Advisory Vote on the Compensation of our Named Executive Officers (page 65) The company has designed its compensation programs to align employee rewards with the creation of long-term stockholder value. 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 37 and the Compensation Tables section beginning on page 53. The board values stockholder opinions and the Compensation Committee will take into account the outcome of the advisory vote when considering future executive compensation decisions.				FOR

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PROXY SUMMARY

QUESTIONS AND ANSWERS (PAGE 67)

Please see the Questions and Answers section beginning on page 67 for important information about the proxy materials, voting, the annual meeting, company documents, communications and the deadlines to submit stockholder proposals for the 2019 annual meeting of stockholders. Additional questions may be directed to Investor Relations at (805) 520-8350 x4510 or ir@avinc.com.

CORPORATE GOVERNANCE (PAGE 22)

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:

•: High proportion of independent directors (6 of 8)
•: Director resignations required from directors receiving more "withhold" votes than "for" votes in an uncontested election
•: Lead Independent Director
•: Independent Audit, Compensation and Nominating and Corporate Governance Committees
•: Regular executive sessions of independent directors
•: Regular board and committee self-evaluations
•: Active stockholder engagement
•: Anti-hedging and anti-short sale policies for executives, directors and employees
•: Executive compensation driven by pay-for-performance philosophy
•: Share ownership guidelines and share retention policy for executives and directors
•: Compensation recovery (clawback) policy for executives

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PROXY SUMMARY

DIRECTOR NOMINEES AND OTHER DIRECTORS (PAGES 11-19)



Name	Age	Director Since	Primary Experience	Committee Membership	# of Other Public Company Boards

Director Nominees

Charles Thomas Burbage* 1	71	2013	Former Executive Vice President and General Manager, Joint Strike Fighter Program of Lockheed Martin	C, NCG, E	0

Charles R. Holland*	73	2004	Retired Air Force General and defense industry consultant		0

Edward R. Muller* 2	67	2013	Former Chairman and Chief Executive Officer of GenOn Energy Inc. and current and former director of public companies	A, C	1

Other Directors

Timothy E. Conver	75	1988	Former President and Chief Executive Officer of the company	E	0

Arnold L. Fishman*	74	1998	Founder and former chairman of the Board of Lieberman Research Worldwide	C	0

Catharine Merigold*	63	2015	Founder and Managing Partner of Vista Ventures	A, NCG	0

Wahid Nawabi	50	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		0

Stephen F. Page*	79	2013	Former Chief Financial Officer of United Technologies Corporation and Chief Executive Officer of its Otis Elevator division and former director of public companies	L, A, NCG	0

* = Independent Director

L = Lead Independent Director

A = Audit Committee

C = Compensation Committee

E = Executive Committee

NCG = Nominating and Corporate Governance Committee

1.: If re-elected, the nominee will serve on the Compensation Committee, Nominating and Corporate Governance Committee and Executive Committee.
2.: If re-elected, the nominee will serve on the Compensation Committee and Audit Committee.

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PROPOSAL 1. ELECTION OF NOMINEES TO THE BOARD OF DIRECTORS

PROPOSAL 1.
ELECTION OF NOMINEES TO THE BOARD
OF DIRECTORS

Our board of directors 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 bylaws, our board of directors may fill existing vacancies on the board of directors by appointment.

The term of office of the Class I directors will expire at the annual meeting. At the recommendation of the Nominating and Corporate Governance Committee, our board of directors proposes the election of Charles Thomas Burbage, Edward R. Muller and Charles R. Holland. All nominees currently serve as Class I directors. Each of Mr. Burbage, Mr. Muller and Mr. Holland was elected by stockholders at the 2016 annual meeting of stockholders.

Charles Thomas Burbage

Edward R. Muller

Charles R. Holland

Each of Mr. Burbage, Mr. Muller and Mr. Holland has indicated his willingness to serve if elected. If Mr. Burbage, Mr. Muller or Mr. Holland 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 three Class II directors, whose terms expire at the annual meeting of stockholders in 2020, and two Class III directors, whose terms expire at the annual meeting of stockholders in 2021.

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.

Withholdings will be counted as present for the purposes of this vote but are not counted as votes cast. Broker non-votes will not be counted as present and are not entitled to vote on this proposal.

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 I directors will be elected on a plurality basis and the three nominees receiving the highest number of "for" votes will be elected as directors. Our Corporate Governance Guidelines,

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PROPOSAL 1. ELECTION OF NOMINEES TO THE BOARD OF DIRECTORS

however, provide that at any stockholder meeting at which directors are subject to an uncontested election, each director must receive more "for" votes than "withhold" votes with respect to that director. If a director is elected but receives more "withhold" votes than "for" votes, he or she has agreed to submit a letter of resignation to the board of directors promptly following the certification of the election results. The Nominating and Corporate Governance Committee will make a recommendation to the board on whether to accept or reject the resignation, or whether other action should be taken. The board will act on the resignation taking into account the recommendation of the Nominating and Corporate Governance Committee and publicly disclose its decision and

rationale within 100 days of the certification of the election results. The director who tenders the resignation will not participate in the decisions of the Nominating and Corporate Governance Committee or the board that concern the resignation.

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., 900 Innovators Way, Simi Valley, California 93065 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

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 others 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 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 All 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 be a recognized person of high integrity, ethics and values, have a proven record of success and demonstrate respect for corporate governance requirements and practices. Each director must also possess practical and mature business judgment, as well as demonstrate innovative thinking and an entrepreneurial spirit, qualities 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 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.

•: experience as chief executive officer, president or executive management of a public or large private company;
•: extensive knowledge of the company's business;
•: aerospace and defense industry expertise;
•: global and international business experience;
•: strategic development experience, including mergers, acquisitions, venture capital and other strategic transactions;
•: diversity of expertise and experience, including substantive matters pertaining to our business, relative to other directors;
•: experience in marketing, engineering, technology and innovation, operations, supply chain, manufacturing and legal;
•: high level of financial literacy and experience;
•: experience as a board member of another publicly-held company;
•: data analytics experience;
•: commercial business experience; and
•: experience in scaling or growing a startup or small business into a significant business.

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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 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 which, in the opinion of the company's board, would interfere with the exercise of independent judgment in carrying out the responsibilities of a director.

In evaluating director independence, the board took into consideration General (Retired) Charles R. Holland's service as a consultant to the company.

Pursuant to a consulting agreement with the company effective January 1, 2016 and its subsequent amendments, Mr. Holland performs consulting services for us on a general basis and with respect to particular individual projects assigned by us. During the fiscal year ended April 30, 2019, we paid to Mr. Holland approximately $48,000 in consulting fees pursuant to the terms of his consulting agreement. The board determined that Mr. Holland has no relationship with the company, including Mr. Holland's consulting arrangement with the company, that would interfere with his exercise of independent judgment in carrying out his responsibilities as an independent director.

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2019 NOMINEES FOR CLASS I 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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2019 NOMINEES FOR CLASS I DIRECTORS

Director Nominees



		Charles Thomas Burbage

		Director Since:				2013

		Age:				71

		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. and Chemring Group, Inc., a subsidiary of Chemring Group PLC. 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. This background and experience is critically important to the board because of the innovative nature and technical complexity of our products.

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2019 NOMINEES FOR CLASS I DIRECTORS



		Edward R. Muller

		Director Since:				2013

		Age:				67

		Board Committees and Leadership:				Chair of Audit Committee and member of Compensation Committee

		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., 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. Mr. Muller serves as a director of Transocean Ltd., an offshore oil and gas driller, and 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, the Pacific Council on International Policy and the Board of Trustees of the Riverview School (which he chaired until June 2018), and previously was Chairman of the U.S. – Philippines Business Committee and Co-Chairman of the International Energy Development Council. 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, 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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2019 NOMINEES FOR CLASS I DIRECTORS



		Charles Holland

		Director Since:				2004

		Age:				73

		Board Committees and Leadership:				None

		Summary of Experience				General Holland has served as a member of our board of directors since 2004. General Holland retired as Commander, Headquarters U.S. Special Operations Command ("USSOCOM") in November 2003 and currently serves as an independent consultant for various entities. Mr. Holland has been a consultant of the company since February 2004. Prior to his retirement, Mr. Holland was responsible for all special operations forces of the Army, Navy and Air Force, both active duty and reserve. Mr. Holland entered the United States Air Force in 1968. He has commanded a squadron, two Air Force wings, served as Deputy Commanding General of the Joint Special Operations Command, and was Commander of the Special Operations Command, Pacific. Prior to commanding USSOCOM, he commanded the Air Force Special Operations Command and was the Vice Commander of U.S. Air Forces in Europe. Mr. Holland serves on the board of directors of a number of private companies in the defense industry, including SELEX Galileo, Inc., MAG Aerospace and TENAX Aerospace, served on the Executive Advisory Board of Cubic Global Defense until September 2018, along with being on the Advisory Board of General Atomics Aeronautical Systems, Inc. Mr. Holland has a B.S. in aeronautical engineering from the U.S. Air Force Academy, an M.S. in business management from Troy State University (W. Germany) and an M.S. in astronautical engineering from the Air Force Institute of Technology.

		Specific Qualifications, Attributes, Skills and Experience:

						Defense Industry and Senior Military Experience Mr. Holland brings to the board of directors his perspective and expertise as a warfighter and senior commander and as a senior consultant to the defense industry. He offers critical insight into the needs and demands of our UAS customers.

						Extensive Knowledge of the Company As a result of General Holland's years of experience as a director and his service as a consultant to the company, he has extensive knowledge of our products, business and personnel, which provides a valuable perspective to the board.

						Extensive Global or International Business Experience As a result of his military service and consulting experience, General Holland has extensive international business experience, including knowledge of international military customers, which is highly relevant to our expanding international UAS business.

						Science, Technology and Innovation Experience General Holland has extensive experience working with aerospace and other engineering and technology companies and currently serves on the board of directors of several companies in such industries, including SELEX Galileo, MAG Aerospace and TENAX Aerospace, served on the Executive Advisory Board of Cubic Global Defense until September 2018, along with being on the Advisory Board of General Atomics Aeronautical Systems. He also holds a bachelor's degree in aeronautical engineering and a master's degree in astronautical engineering. General Holland's significant experience working with technology companies is valuable to the board given the company's product lines and the industries in which the company operates.

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2019 NOMINEES FOR CLASS I DIRECTORS

Continuing Directors



		Timothy E. Conver

		Director Since:				1988

		Age:				75

		Board Committees and Leadership:				Member of Executive Committee

		Summary of Experience				Mr. Conver served as our President from November 1990 and as our Chief Executive Officer from 1992 until his retirement in May 2016. Prior to joining the company, Mr. Conver served as President of Whittaker Electronic Resources, a supplier of engineered products for military electronics and industrial instrumentation, for 10 years. Mr. Conver is a graduate of the University of Montana and received his M.B.A. from the University of California, Los Angeles.

		Specific Qualifications, Attributes, Skills and Experience:

						Chief Executive Officer and Executive Experience Mr. Conver has extensive executive leadership experience, having served as the Chief Executive Officer of the company for over 20 years and as President of Whittaker Electronic Resources for 10 years.

						Extensive Knowledge of the Company's Business His knowledge of all aspects of our business and history and his extensive experience managing companies that provide high-technology solutions to military and industrial customers, and deploy practical innovation focused on current and future customer needs, position him well to serve as a director and as our Chairman of the Board.

						Defense Industry Experience Mr. Conver's extensive knowledge and experience in the defense industry was gained through a long and successful career focused on providing high-technology products and innovation to defense customers throughout the U.S. government and internationally.

						Commercial Business Experience Mr. Conver has considerable experience in the commercial aerospace and industrial industries from his service as President of Whittaker Electronic Resources and Chief Executive Officer of the company. His experience in commercial business is beneficial to the board as the company expands its commercial business operations.

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2019 NOMINEES FOR CLASS I DIRECTORS



		Arnold L. Fishman

		Director Since:				1998

		Age:				74

		Board Committees and Leadership:				Member of Compensation Committee

		Summary of Experience				Mr. Fishman has served as a member of our board of directors since 1998. Mr. Fishman is the founder of Lieberman Research Worldwide, a leading global market research firm, and Interviewing Service of America, a supplier of market survey services. Mr. Fishman served as the Chairman of Lieberman Research Worldwide and Interviewing Service of America from 1979 and 1983, respectively, until July 2015 when he sold his interests in the companies. He currently serves as the Chairman Emeritus of Applied VR, LLC. Mr. Fishman received his B.S. in psychology from Brooklyn College.

		Specific Qualifications, Attributes, Skills and Experience:

						Chief Executive Officer and Executive Experience Mr. Fishman has extensive executive experience as the founder of a market research business and market survey business that grew under his leadership to companies that now conducts market research in over 80 countries around the world.

						Extensive Knowledge of the Company Mr. Fishman has extensive knowledge and understanding of the company's business, products and personnel gained from 18 years of service as a director.

						Related Industry Experience – Marketing and Communication Mr. Fishman brings to the board critical insight into purchasing behaviors and communications and their relationship to successful business decision-making, which is important to our expanding commercial products businesses.

						Science, Technology and Innovation Experience Mr. Fishman has a track record of successfully developing and implementing innovative business models and practices as an entrepreneur, having founded and led several innovative market research businesses. Mr. Fishman serves as Chairman Emeritus of AppliedVR, LLC, a technology company using virtual reality to alter behavior in positive ways covering health, safety training, police empathy and other social issues. Mr. Fishman also represented a major film production studio in Croatia and created various innovative film financing vehicles supporting co-productions with major U.S. studios. This background and experience provides an important perspective to the board given the company's innovative culture and long history of successful innovation.

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2019 NOMINEES FOR CLASS I DIRECTORS



		Catharine Merigold

		Director Since:				2015

		Age:				63

		Board Committees and Leadership:				Member of Audit Committee and Chair of the Nominating and Corporate Governance Committee

		Summary of Experience				Ms. Merigold has been investing in and advising high-growth technology businesses for over 20 years as a venture capitalist. She was a Vice President at Centennial Ventures from 1992 to 1994, and then founded and has been the managing partner of Vista Ventures, a venture firm specializing in investing in software, digital media and network sectors, since January 2000. Prior to founding Vista Ventures, Ms. Merigold served as the President and Chief Executive Officer of University Technology Corporation, a company that managed all technology transfer and associated equity holdings for the University of Colorado system, from 1999 to 2000, and as Vice President of Marketing and Sales for US West Wireless. She began her career at Hewlett-Packard Company, serving in a variety of technical, marketing and sales management roles, including several years spent in Europe. Ms. Merigold has served on a number of corporate boards, including as a board observer for Market Force Information, Inc., a provider of customer intelligence solutions to large consumer companies, a board member of P2Binvestor, Inc., a crowd lending platform providing asset based lines of credit to businesses, and a board member of the Colorado Technology Association, and currently serves as a board member of University License Equity Holdings Inc. (ULEHI), which manages all the equity holdings associated with technology transfer of the University of Colorado. Ms. Merigold holds a B.S. in electrical engineering, with honors, from Washington University in St. Louis and an M.B.A. from Stanford University.

		Specific Qualifications, Attributes, Skills and Experience:

						Extensive Global or International Business Experience Ms. Merigold has substantial international business experience gained from her experience at Hewlett-Packard in Europe and previous experience working for the French power company EDF-GDF. Her international experience is important to the board given the company's growing international business.

						Science, Technology and Innovation Experience As a venture capitalist, Ms. Merigold has experience working with numerous technology companies and companies providing innovative solutions, including serving as a board member of P2Binvestor, Inc. and Tendril Networks, Inc., a provider of energy services management software. Given the company's innovative culture and the technical nature of its products, Ms. Merigold's experience working with technology companies provides useful insight to the board.

						Related Industry Experience – Marketing Ms. Merigold provides the board with unique insight into marketing and consumer purchasing behaviors, gained through experience in marketing positions with Hewlett-Packard and US West Wireless, and as a director of Market Force Information. Her extensive knowledge of marketing and purchasing behavior provides the board with critical knowledge for the expansion of our commercial business.

						Investment Expertise Ms. Merigold has seved as a venture capitalist for over twenty years, serving as Vice President and a Partner of Centennial Ventures and later founding and serving as Managing Partner of Vista Ventures. Her significant experience as a venture capitalist has provided her with key understanding of the variables that lead to high-growth success of businesses, which enables Ms. Merigold to provide valuable insight to the board in evaluating potential strategic investments and opportunities.

						Experience Scaling and Growing Startup and Small Business Through her venture capital experience, Ms. Merigold has gained extensive experience helping companies navigate their way through the startup and high-growth phases into becoming a significant operational business. Her experience working with high-growth companies in a variety of industries brings valuable knowledge to the board regarding the scaling and growing of successful businesses, which assists the board in evaluating the company's growth strategy for new market opportunities and potential strategic arrangements.

						Data Analytics Experience Ms. Merigold brings to the board critical knowledge of data analytics, gained through her experinece at US West Wireless, where she implemented and oversaw a data analytics program, as well as through her role as an advisory board member at Market Force Information, which utilizes data analytics in its products and services. Her experience with data analytics is very valuable to the board as the company grows its commercial business.

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2019 NOMINEES FOR CLASS I DIRECTORS



		Wahid Nawabi

		Director Since:				2016

		Age:				50

		Board Committees and Leadership:				None

		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 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 will be 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 UAS 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."

						Experience Scaling and Growing Startup and Small Business During his tenure at American Power Conversion, Mr. Nawabi was instrumental and led the core leadership team in growing and scaling the company's data center physical infrastructure business, taking the business from its inception to a global leader with $600 million in annual global revenues. Mr. Nawabi's experience in growing and scaling businesses will provide valuable insight to the board as the company seeks to grow its commercial operations and evaluates potential strategic transactions.

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2019 NOMINEES FOR CLASS I DIRECTORS



		Stephen F. Page

		Director Since:				2013

		Age:				79

		Board Committees and Leadership:				Lead Independent Director, Member of Audit Committee and Nominating and Corporate Governance 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., a home improvement retailer, from 2003 to 2012; PACCAR, Inc., 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, including director, Vice Chairman and Chief Financial Officer, and President and Chief Executive Officer of Otis Elevator, currently a $12 billion 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 current annual revenues of approximately $60 billion, and he also served as Chief Executive Officer of Otis Elevator, currently a $12 billion revenue operating 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 commercial business experience is of significant importance to the board as the company expands its commercial operations.

						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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2019 NOMINEES FOR CLASS I DIRECTORS

SUMMARY OF DIRECTOR NOMINEES

The following information and graphics summarize the qualifications of the nominees for Class I director and the other members of the board. Based on a careful assessment, the Nominating and Corporate Governance Committee and the board 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.

All 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.

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


INDEPENDENCE

PRIOR BOARD SERVICE

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CORPORATE GOVERNANCE

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 2019 director nominees consist of three Class I director nominees, each of whom is an independent director that has significant executive leadership experience and knowledge of the company's business.

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. In addition, the non-employee directors also hold regular executive sessions. These meetings allow our independent and non-employee 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 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: Timothy E. Conver
•: Lead Independent Director: Stephen F. Page
•: Chief Executive Officer: Wahid Nawabi
•: Committees led by independent directors
•: Active engagement by all directors

Prior to May 2016, Mr. Conver served as our Chairman of the Board and Chief Executive Officer. Upon Mr. Conver's retirement as our Chief Executive Officer effective May 1, 2016, a position Mr. Conver held since 1992, the board separated our Chairman of the Board and Chief Executive Officer positions, with Mr. Conver continuing as our Chairman of the Board and Mr. Nawabi assuming the role of Chief Executive Officer.

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The board believes that our current leadership structure, which consists of a non-independent Chairman of the Board, a separate Chief Executive Officer who is also a member of the board, 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, as it permits Mr. Nawabi to focus his full attention to our business and operations. Additionally, this structure allows Mr. Conver, who has extensive knowledge of our business and operations as our former President and Chief Executive Officer, to focus his attention on the company's strategic issues considered by our board. In addition, the board believes that Mr. Conver's interest as a significant stockholder is strongly aligned with his fiduciary duties as a director of the company.

Role in Risk Oversight

Our board of directors is responsible for overseeing our risk management and delegates many of these functions to the Audit Committee. 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. In addition to the Audit Committee's 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.

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 10 meetings in fiscal year 2019. 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 2019.

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. Seven members of our board, who were serving as directors at the time, attended the 2018 annual meeting of stockholders.

Board Committees

The board has an Audit Committee, a Compensation Committee, a Nominating and Corporate Governance 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 "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.

Audit Committee


Committee Chair:		Edward R. Muller
Other Committee Members:		Stephen F. Page and Catharine Merigold
Meetings held in FY 2019:		9

The board has determined that Mr. Muller and Mr. Page 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;

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•: 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.

The 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:		Arnold L. Fishman and Edward R. Muller
Meetings held in FY2019		7

Our Compensation Committee's purpose is to assist our board of directors in determining the development plans and compensation for our senior management and the compensation to be paid to directors for board and committee service. The Compensation Committee of our board is comprised 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 Securities Exchange Act of 1934, as amended (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.

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

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

In addition, the Compensation Committee 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, 2019 were Arnold L. Fishman, Charles Thomas Burbage, and Edward R. Muller. None of the current 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:		Catharine Merigold
Other Committee Members:		Charles Thomas Burbage and Stephen F. Page
Meetings held in FY 2019:		4

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 of directors' 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, alternative energy, automotive or industrials;
•: global and international business experience;
•: experience in strategic development activities, including mergers, acquisitions, partnerships and venture capital transactions;

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CORPORATE GOVERNANCE

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

In addition, we may require any candidate to furnish such other information as may reasonably be required

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CORPORATE GOVERNANCE

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.

Executive Committee


Committee Chair:		Timothy E. Conver
Other Committee Member:		Charles Thomas Burbage
Meetings held in FY 2019:		2

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 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 board and committee performance 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.

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, 900 Innovators Way, Simi Valley, California 93065 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 polices for executives, directors and employees;
•: share ownership guidelines and share retention policy for executives and directors; and
•: a compensation recovery policy for executives.

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DIRECTOR COMPENSATION

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. Pay Governance provided the Compensation Committee with non-employee director compensation data of peer companies identified by

Pay Governance in March 2017 to assist the Compensation Committee in setting non-management director compensation for fiscal year 2018. After discussing the compensation of non-management directors with Pay Governance, the Compensation Committee did not recommend, and the board did not make, any changes in fiscal year 2018 to non-management director compensation. In June 2018, based on the compensation data provided by Pay Governance in March 2017, the Compensation Committee recommended, and the board approved, an increase in the annual cash retainer fee for the Lead Independent Director to $20,000 for fiscal 2019 service. The board decided that all other annual cash retainer fees and the value of annual equity compensation provided to non-employee directors for fiscal 2019 service should remain at the same levels as in effect for fiscal 2018 based on the recommendation of the Compensation Committee.

The table below presents the annual cash retainer fees for our non-employee directors in effect in fiscal year 2019.

Director Responsibilities		Annual Retainer


Board Members		$45,000
Chairman of the Board		$50,000
Lead Independent Director		$20,000
Chair of Audit Committee		$16,000
Audit Committee Member (not including Chair)		$ 6,000
Chair of Nominating and Corporate Governance Committee		$10,000
Nominating and Corporate Governance Committee Member (not including Chair)		$ 2,500
Chair of Compensation Committee		$12,000
Compensation Committee Member (not including Chair)		$ 4,000

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 2019 for any director.

In addition to cash retainer fees for fiscal 2019, the board determined that our continuing non-employee

directors receive a grant of restricted stock awards with an aggregate value of $110,000 on the date of grant (measured by the fair market value per share of our common stock subject to the awards on the date of grant). 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 fair market value per share of our common stock subject to the 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 annual equity awards at comparable companies based on discussions with Pay Governance.

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DIRECTOR COMPENSATION

In June 2018, the board of directors approved the issuance of the annual restricted stock awards to our non-employee directors for their service during fiscal 2019, each with a value of $110,000, which awards vest in three equal annual installments on July 11, 2019, 2020 and 2021.

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.

Pursuant to an agreement with Mr. Conver, we provide supplemental medical coverage for Mr. Conver and his spouse following his retirement as the company's Chief Executive Officer. As of April 30, 2019, the actuarial value of Mr. Conver and his spouse's lifetime supplemental medical coverage is approximately $164,717 based on the estimated future cost of insurance premiums and the life expectancies of Mr. Conver and his spouse. The value of the supplemental medical coverage provided to Mr. Conver and his spouse during fiscal year 2019 is reflected in the table below.

Fiscal Year 2019 Non-Employee Director Compensation Table

The following table identifies the compensation paid during fiscal year 2019 to each person who served as a non-employee director during fiscal year 2019.

Name	Fees Earned or Paid in Cash ($)	Stock Awards 1 ($)	All Other Compensation ($)	Total ($)


Charles Thomas Burbage	53,500	110,009	—	163,509
Timothy E. Conver	95,000	110,009	13,642 2	218,651
Arnold L. Fishman	55,000	110,009	—	165,009
Charles R. Holland	45,000	110,009	48,000 3	203,009
Catharine Merigold	67,875	110,009	—	177,884
Edward R. Muller	65,000	110,009	—	175,009
Stephen F. Page	64,125	110,009	—	174,134

1.: The value of the equity awards equals their grant date fair value as computed in accordance with Financial Accounting Standards Board ("FASB"), Accounting Standards Codification ("ASC"), Topic 718 with respect to restricted stock awarded to directors during fiscal year 2019. For additional information regarding the valuation assumptions used in the calculation of these amounts, refer to Note 12 to the financial statements included in our annual report on Form 10-K for our 2019 fiscal year, as filed with the SEC.
2.: Includes costs for supplemental medical coverage for Mr. Conver and his spouse and certain travel and hospitality related costs for Mr. Conver's spouse to accompany Mr. Conver an offsite board meeting. Pursuant to an agreement with Mr. Conver, our former President and Chief Executive Officer, we provide supplemental medical coverage for Mr. Conver and his spouse following his retirement as our President and Chief Executive Officer. As of April 30, 2019, the actuarial value of Mr. Conver and his spouse's lifetime supplemental medical coverage is approximately $164,717, based on the estimated future cost of insurance premiums and the life expectancies of Mr. Conver and his spouse. Included in this table is the value of the supplemental medical coverage provided to Mr. Conver and his spouse during fiscal year 2019.
3.: Consists of consulting fees received by Mr. Holland. See "Independence Determinations" above for a full description of Mr. Holland's consulting relationship.

The non-employee members of our board who held such positions on April 30, 2019 held the following aggregate number of unexercised options as of such date:

Name		Number of Securities Underlying Unexercised Options


Charles Thomas Burbage		25,000
Timothy E. Conver		101,362
Arnold L. Fishman		19,500
Charles R. Holland		—
Catharine Merigold		—
Edward R. Muller		25,000
Stephen F. Page		20,000

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DIRECTOR COMPENSATION

The non-employee members of our board who held such positions on April 30, 2019 held the following aggregate number of shares of unvested restricted stock as of such date:

Name		Number of Securities Underlying Unvested Restricted Stock


Charles Thomas Burbage		7,126
Timothy E. Conver		12,739
Arnold L. Fishman		7,126
Charles R. Holland		7,126
Catharine Merigold		7,725
Edward R. Muller		7,126
Stephen F. Page		7,126

The following table provides a breakdown of fees earned or paid in cash during fiscal year 2019.

Name	Annual Retainers ($)	Chairman of the Board, Lead Independent Director and Committee Chair Retainer Fees ($)	Committee Member Retainer Fees ($)	Total Fees ($)


Charles Thomas Burbage	45,000	3,000	5,500	53,500
Timothy E. Conver	45,000	50,000	—	95,000
Arnold L. Fishman	45,000	9,000	1,000	55,000
Charles R. Holland	45,000	—	—	45,000
Catharine Merigold	45,000	15,000	7,875	67,875
Edward R. Muller	45,000	16,000	4,000	65,000
Stephen F. Page	45,000	12,500	6,625	64,125

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. 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 that 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 in effect during fiscal year 2019, each non-employee director was expected to own shares of the company's common stock with a market value of no less than three 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 (a) five years of the board's original adoption of the plan on August 6, 2013 or (b) five years of the date on which such person was appointed to the board. In June 2019, the board amended the ownership guidelines to require non-employee directors to own shares of the company's common stock with a market value of not less than five times his or her current annual cash retainer for board service. Any shares of our common stock held by a member of our board of directors in margin accounts or pledged as collateral for a loan will not be considered for purposes of satisfying the ownership guidelines described above. The company determines progress towards 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, 2019 pursuant to these guidelines for each of our current non-employee directors, as of April 30, 2019:

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DIRECTOR COMPENSATION

Name	Dollar Value of Equity Ownership as a Multiple of Annual Retainer ($) 1	Minimum Ownership Level Required as a Multiple of Annual Retainer


Charles Thomas Burbage	24.8x	3x
Timothy E. Conver	2754.5x	3x
Arnold Fishman	496.3x	3x
Charles R. Holland	79.8x	3x
Catharine Merigold	12.3x	3x
Edward R. Muller	49.0x	3x
Stephen F. Page	54.7x	3x

1.: For each non-employee director, calculated by dividing (a) the sum of (1) the aggregate number of shares of vested and unrestricted common stock held by such non-employee director, multiplied by the closing price of $68.56 per share of our common stock on April 30, 2019, the last trading day of fiscal 2019, plus (2) the amount by which the market value of the shares of common stock underlying vested stock options held by such non-employee exceeds the exercise price of such stock options, if any, 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). In June 2019, the board amended the guidelines to require an ownership multiple of 5x of the annual retainer for board service. Each of our directors would have been compliant with such new standard had such standard been in effect on April 30, 2019.

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 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.

Stock ownership and retention guidelines and anti-hedging 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, 2018, 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 9, 2019 about our executive officers.

Name		Position


Wahid Nawabi 1	50	President and Chief Executive Officer
Teresa Covington	56	Sr. Vice President and Chief Financial Officer
Ken Karklin	50	Sr. Vice President of Operations
Melissa Brown	42	Vice President, General Counsel and Corporate Secretary

1.: The background and experience of Mr. Nawabi is detailed on page 18.

Name of Beneficial Owner	Number of Shares Beneficially Owned	Percentage of Shares Outstanding


5% Stockholders
BlackRock, Inc. 1	3,852,473	16.1%
The Vanguard Group 2	2,924,146	12.2%
Dimensional Fund Advisors LP 3	1,339,540	5.6%
Named Executive Officers, Directors and Director Nominees:
Wahid Nawabi 4	189,644	*
Teresa Covington	18,463	*
Kirk Flittie 5	72,120	*
Ken Karklin	10,010	*
Melissa Brown	7,228	*
Charles Thomas Burbage 6	50,525	*
Timothy E. Conver 7	1,744,851	7.3%
Arnold L. Fishman 8	342,303	1.4%
Charles R. Holland	61,600	*
Catharine Merigold	17,877	*
Edward R. Muller 9	51,335	*
Stephen F. Page 10	50,525	*
Current Directors and Executive Officers as a Group (11 persons)	2,544,361	10.5%

	(a)		(b)	(c)

Plan category	Number of securities to be issued upon exercise of outstanding options, warrants and rights 1		Weighted-average exercise price of outstanding options, warrants and rights 1	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	337,026	1	$25.25	2,468,389	2
Equity compensation plans not approved by security holders	—		—	—

Total	337,026		$25.25	2,468,389

Financial Measure 1


Revenue	314.3	268.4	17.1
Pre-Tax Income	50.5	32.6	54.9
Annual Bookings	329.4	374.4	(12.0	)

Best Practices We Maintain		Practices We Avoid

✓	Majority of total potential compensation paid to executives based on our financial performance	✘	No employment agreements with executive officers
✓	Compensation recovery (or "clawback") policy for the recovery of incentive compensation of executive officers	✘	No discretionary cash bonuses for Named Executive Officers under annual bonus plan
✓	Anti-hedging and anti-short sale policies for executives	✘	No executive pensions
✓	Limited perquisites	✘	No single-trigger for change in control situations under our Severance Plan
✓	Retention of independent compensation consultant	✘	No excise tax gross-up payments upon a termination after a change in control.
✓	Annual risk assessment of compensation practices	✘	No repricing or exchange of "underwater" stock options without stockholder approval
✓	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	✘	No minimum guaranteed vesting for performance-based equity awards
✓	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.

Named Executive Officer


Wahid Nawabi	600,000	14.3
Teresa Covington	350,000	16.7
Kirk Flittie	325,000	8.3
Kenneth Karklin	250,000	8.7
Melissa Brown	300,000	24.0

Tim Conver
Chairman of the Board

Simi Valley, California
August 15, 2019


		Compensation Committee Charles Thomas Burbage (Chairman) Arnold L. Fishman Edward R. Muller

Named Executive Officer	Target Bonus Level


Wahid Nawabi	$	600,000	100.0%
Teresa Covington	$	200,000	57.1%
Kirk Flittie	$	200,000	61.5%
Kenneth Karklin	$	150,000	60.0%
Melissa Brown	$	100,000	33.3%

	Year Ended April 30,

	2018			2017
	($ in millions)

Net sales	$	38.4		$	36.2
(Loss) before income taxes	$	(6.4	)	$	(7.2	)
Annual bookings	$	38.5		$	39.3

	Minimum

	($ in millions)

Revenue		273.1	303.5	379.3	455.2
Pre-Tax Income		15.2	30.4	37.9	45.5
Annual Bookings		276.8	325.7	407.1	488.5

Name	Title	RSAs (#)	Target PRSUs (#)	Maximum PRSUs (#)	% of Total Long-Term Award Allocated to Performance


Wahid Nawabi	President and Chief Executive Officer	5,389	10,009	20,018	65.0%
Teresa Covington	Senior Vice President and Chief Financial Officer	1,714	3,184	6,368	65.0%
Kirk Flittie	Vice President and General Manager, UAS	1,714	3,184	6,368	65.0%
Ken Karklin	Senior Vice President of Operations	857	1,592	3,184	65.0%
Melissa Brown	Vice President and General Counsel	734	1,364	2,728	65.0%

	Original Metrics (May 2017)				Amended Metrics (June 2018)

	Revenue		Operating Income		Revenue		Operating Income
	($ in millions)

Threshold		928.4		63.8		904.1		63.8
Target		973.9		88.4		946.1		88.4
Maximum		1,461.0		132.7		1,419.2		132.7

Name	Title	Target PRSUs (#)	% Payout	Shares of Common Stock Issued (#)


Wahid Nawabi	President and Chief Executive Officer	15,136	35.0%	5,297
Teresa Covington	Senior Vice President and Chief Financial Officer	5,314	35.0%	1,859
Kirk Flittie	Vice President and General Manager, UAS	5,314	35.0%	1,859
Ken Karklin	Senior Vice President of Operations	3,059	35.0%	1,070
Melissa Brown	Vice President and General Counsel	1,127	35.0%	394

Name


Wahid Nawabi	11.6x	4x
Teresa Covington 2	1.2x	2x
Kirk Flittie 3	13.3x	2x
Kenneth Karklin 4	0.8x	2x
Melissa Brown 5	0.5x	2x

Name and Principal Positions	Year	Salary ($)		Bonus ($) 1	Stock Awards ($) 2	Option Awards ($)	Non-Equity Incentive Plan Compensation ($) 3	All Other Compensation ($) 4	Total ($)


Wahid Nawabi	2019	624,249	5	1,500	590,667	—	818,805	16,886	2,052,107
President and Chief	2018	534,628		162,750	489,961	—	529,889	16,326	1,733,554
Executive Officer	2017	510,973		121,590	—	—	239,210	16,039	887,812
Teresa Covington 6	2019	350,579		1,500	187,877	—	272,935	18,499	831,390
Senior Vice President and Chief	2018	307,253		52,500	149,972	—	159,324	18,320	687,370
Financial Officer	2017	256,036		45,742	—	—	89,990	15,968	407,736
Kirk Flittie 7	2019	326,270		1,500	187,877	—	272,935	18,557	807,139
Former Senior Vice	2018	299,356		52,500	149,972	—	162,699	18,223	682,750
President & General	2017	280,298		43,855	—	—	86,279	17,153	427,585
Manager, UAS
Kenneth Karklin	2019	250,670		1,500	93,938	—	204,701	14,526	565,335
Senior Vice President	2018	239,422		—	99,956	—	119,848	14,154	473,380
Operations	2017	232,399		28,635	—	—	56,336	13,993	331,363
Melissa Brown 8	2019	300,282		1,500	80,466	—	136,467	17,506	536,221
Vice President,	2018	241,935		17,500	69,985	—	53,358	15,506	398,284
General Counsel & Secretary

	Name		Grant Date Fair Value of PRSUs Granted in June 2018 for FY 2019-2021 Performance Period ($)


	Wahid Nawabi			1,429,886
	Teresa Covington			454,866
	Kirk Flittie			454,866
	Kenneth Karklin			227,433
	Melissa Brown			194,861

Name


Wahid Nawabi	2019	16,083	803	16,886
Teresa Covington	2019	16,177	2,322	18,499
Kirk Flittie	2019	16,235	2,322	18,557
Kenneth Karklin	2019	13,284	1,242	14,526
Melissa Brown	2019	16,966	540	17,506



				Estimated Future Payouts Under Non-Equity Incentive Plan Awards						Estimated Future Payouts Under Equity Incentive Plan Awards
Name	Grant Date			Threshold ($)		Target ($)		Maximum ($)		Threshold (#) 1		Target (#) 1		Maximum (#) 1

Equity Awards
Wahid Nawabi		6/29/18	3		—		—		—		—		—		—	5,389	4	384,936
Wahid Nawabi		6/29/18	3		—		—		—		5,005		10,009		20,018			205,730
Teresa Covington		6/29/18	3		—		—		—		—		—		—	1,714	4	122,431
Teresa Covington		6/29/18	3		—		—		—		1,592		3,184		6,368			65,446
Kirk Flittie 5		6/29/18	3		—		—		—		—		—		—	1,714	4	122,431
Kirk Flittie 5		6/29/18	3		—		—		—		1,592		3,184		6,368			65,446
Ken Karklin		6/29/18	3		—		—		—		—		—		—	857	4	61,216
Ken Karklin		6/29/18	3		—		—		—		796		1,592		3,184			32,723
Melissa Brown		6/29/18	3		—		—		—		—		—		—	734	4	52,430
Melissa Brown		6/29/18	3		—		—		—		682		1,364		2,728			28,036
Annual Executive Cash Bonus Plan 6
Wahid Nawabi		5/16/18			300,000		600,000		1,200,000		—		—		—	—		—
Teresa Covington		5/16/18			100,000		200,000		400,000		—		—		—	—		—
Kirk Flittie		5/16/18			100,000		200,000		400,000		—		—		—	—		—
Kenneth Karklin		5/16/18			75,000		150,000		300,000		—		—		—	—		—
Melissa Brown		5/16/18			50,0000		100,000		200,000		—		—		—	—		—

	Option Awards											Stock Awards

																	Equity Incentive Plan Awards:
				Number of Securities Underlying Unexercised Options 1											Market Value of Shares or Units of Stock that Have Not Vested ($) 1		Number of Unearned Shares, Units or Other Rights That Have Not Vested (#)			Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($)
												Number of Shares or Units of Stock that Have Not Vested (#)
								Option Exercise Price ($)		Option Expiration Date
Name	Grant Date			Exercisable (#)		Unexercisable (#)		Option Exercise Price ($)		Option Expiration Date

Wahid Nawabi		6/29/18	2		—		—		—		—		5,389	3		369,470		—			—
		6/29/18	2		—		—		—		—		—			—		20,018	4		1,372,434	4
		6/30/17	5		—		—		—		—		4,275	6		293,094		—			—
		6/30/17	5		—		—		—		—		—			—		27,748	4		1,902,403	4
		5/30/17			—		—		—		—		2,630	7		180,313		—			—
		6/24/15			30,000		20,000		26.70		6/24/25		—			—		—			—
		6/24/15			—		—		—		—		6,000	6		411,360		—			—
		8/1/14			12,928		3,236		31.27		8/1/24		—			—		—			—
		8/1/14			—		—		—		—		1,452	8		99,549		—			—
		4/22/13			30,000		—		18.07		4/22/23		—			—		—			—
		3/1/12			50,000		—		28.72		3/1/22		—			—		—			—

Teresa Covington		6/29/18	2		—		—		—		—		1,714	3		117,512		—			—
		6/29/18	2		—		—		—		—		—			—		6,368	4		436,590	4
		6/30/17	5		—		—		—		—		1,309	6		89,745		—			—
		6/30/17	5		—		—		—		—		—			—		8,638	4		592,221	4
		5/30/17			—		—		—		—		805	7		55,191		—			—
		6/24/15			—		—		—		—		3,200	6		219,392		—			—
		6/24/15			—		—		—		—		809	6		55,465		—			—

Kirk Flittie 9		6/29/18	2		—		—		—		—		1,714	3		117,512		—			—
		6/29/18	2		—		—		—		—		—			—		6,368	4		436,590	4
		6/30/17	5		—		—		—		—		1,309	6		89,745		—			—
		6/30/17	5		—		—		—		—		—			—		8,638	4		592,221	4
		5/30/17			—		—		—		—		805	7		55,191		—			—
		6/24/15			—		—		—		—		4,000	6		274,240		—			—
		8/1/14			—		—		—		—		350	8		23,996		—			—

Kenneth Karklin		6/29/18	2		—		—		—		—		857	3		58,756		—			—
		6/29/18	2		—		—		—		—		—			—		3,184	4		218,295	4
		6/30/17	5		—		—		—		—		872	6		59,784		—			—
		6/30/17	5		—		—		—		—		—			—		4,972	4		340,880	4
		5/30/17			—		—		—		—		537	7		36,817		—			—
		6/24/15			—		—		—		—		2,800	6		191,968		—			—
		8/1/14			—		—		—		—		200	8		13,712		—			—

Melissa Brown		6/29/18	2		—		—		—		—		734	3		50,323		—			—
		6/29/18	2		—		—		—		—		—			—		2,728	4		187,032	4
		6/30/17	5		—		—		—		—		611	6		41,890		—			—
		6/30/17	5		—		—		—		—		—			—		1,832	4		125,602	4
		5/30/17			—		—		—		—		376	7		25,779		—			—
		12/2/16			—		—		—		—		1,667	10		114,290		—			—

	FY2018-2020 Performance Period				FY2019-2021 Performance Period

	Target Number	Target Value ($)	Maximum Number	Maximum Value ($)	Target Number	Target Value ($)	Maximum Number	Maximum Value ($)

Wahid Nawabi	13,874	951,201	27,748	1,902,403	10,009	686,217	20,018	1,372,434

Teresa Covington	4,319	296,111	8,638	592,221	3,184	218,295	6,368	436,590

Kirk Flittie	4,319	296,111	8,638	592,221	3,184	218,295	6,368	436,590

Kenneth Karklin	2,486	170,440	4,972	340,880	1,592	109,148	3,184	218,295

Melissa Brown	916	62,801	1,832	125,602	1,364	93,516	2,728	187,032

	Option Exercises		Stock Awards

Name	Number of Shares Acquired on Exercise (#)	Value Realized on Exercise ($)	Number of Shares Acquired on Vesting (#) 1	Value Realized on Vesting ($) 1

Wahid Nawabi	—	—	18,517	1,359,852

Teresa Covington	—	—	5,722	405,898

Kirk Flittie	—	—	5,868	426,978

Kenneth Karklin	—	—	4,442	320,961

Melissa Brown	—	—	2,740	189,931

Name	Cash Severance 1 ($)	Benefits Continuation 2 ($)


Wahid Nawabi	2,400,000	26,749	2,426,749

Teresa Covington	750,000	18,950	768,950

Kirk Flittie 3	725,000	36,418	761,418

Kenneth Karklin	550,000	36,418	586,418

Melissa Brown	500,000	13,675	513,675

		Other Benefits

Name	Cash Severance 1 ($)	Benefits Continuation 2 ($)	In-the-Money Value of Accelerated Stock Options 3 ($)	Value of Accelerated Restricted Stock Awards 4 ($)	Value of Accelerated Restricted Stock Unit Awards 5 ($)	Total Value of Change- in-Control Related Benefits ($)

Wahid Nawabi	3,600,000	26,749	957,870	1,353,786	951,201	6,889,607

Teresa Covington	1,025,000	18,950	—	537,305	296,111	1,877,366

Kirk Flittie 6	987,500	36,418	—	560,684	296,111	1,880,712

Kenneth Karklin	750,000	36,418	—	361,037	170,440	1,317,895

Melissa Brown	700,000	13,675	—	232,281	62,801	1,008,757


		Audit Committee Edward R. Muller (Chair) Stephen F. Page Catharine Merigold

	FY2019 Fees		FY2018 Fees


Audit Fees	$	1,018,945	$	1,304,824
Audit-Related Fees		—		—
Tax Fees		88,277		129,454
All Other Fees		1,995		1,995

Total	$	1,109,217	$	1,436,273


		ON BEHALF OF THE BOARD OF DIRECTORS

		Wahid Nawabi President and Chief Executive Officer
Simi Valley, California August 15, 2019

ANNUAL MEETING OF STOCKHOLDERS OF

AEROVIRONMENT, INC.

September 27, 2019



	PROXY VOTING INSTRUCTIONS

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Vote online/phone until 11:59 PM EST the day before the meeting. MAIL - Sign, date and mail your proxy card in the envelope provided as soon as possible.		COMPANY NUMBER
IN PERSON - You may vote your shares in person by attending the Annual Meeting.		ACCOUNT NUMBER
GO GREEN - e-Consent makes it easy to go paperless. With e-Consent, you can quickly access your proxy material, statements and other eligible documents online, while reducing costs, clutter and paper waste. Enroll today via www.astfinancial.com to enjoy online access.