AEROVIRONMENT,INC. (NASDAQ:AVAV) Files An 8-K Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers

AEROVIRONMENT,INC. (NASDAQ:AVAV) Files An 8-K Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers
Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

On December19, 2018, the Compensation Committee of the Board of Directors of AeroVironment,Inc. (the “Company”) adopted the AeroVironment,Inc. Executive Severance Plan (the “Plan”), which provides for severance payments and other benefits to eligible employees, including each of the Company’s named executive officers (currently, Wahid Nawabi, Teresa Covington, Kirk Flittie, Ken Karklin, and Melissa Brown), due to the expiration on December31, 2018 of all existing severance agreements between the Company and its officers, in accordance with their terms. The Plan provides for the payment of certain benefits to each such officer in connection with a change in control and/or the termination of the officer’s employment by reason of death or “disability,” by the Company without “cause,” or by the officer for “good reason,” in certain cases in connection with a “change in control” (in each case as defined in the Plan), as summarized below.Except as noted below, the terms of the severance payments and other benefits provided to each of the Company’s officers under the Plan are identical, and the Plan does not provide for a gross-up of severance benefits in the event that excise taxes under Section280G of the Internal Revenue Code of 1986, as amended, apply.

Upon termination of the officer’s employment by the Company without cause, and in the event there is no change in control of the Company within 3 months after or 18 months before termination of the officer’s employment, the officer is entitled to receive: (i)1.0x the sum of his or her base salary and annual target bonus for the fiscal year in which termination occurs or for the previous fiscal year if the annual target bonus for the fiscal year has not yet been set (1.5x for the Company’s Chief Executive Officer), (ii)a prorated target bonus for the fiscal year in which termination occurs, and (iii)the continuation of certain employee welfare plan benefits, including for his or her dependents and beneficiaries, for a period of 12 months following the termination date or until the officer becomes eligible for equivalent benefits from a subsequent employer.

Upon termination of the officer’s employment by the Company without cause or by the officer for good reason within 3 months before a change in control, the officer is entitled to receive: (i)1.5x the sum of his or her base salary and annual target bonus for the fiscal year in which termination occurs or for the previous fiscal year if the annual target bonus for the fiscal year has not yet been set (2.5x for the Company’s Chief Executive Officer), (ii)a prorated target bonus for the fiscal year in which termination occurs, (iii)acceleration of vesting and exercisability of restricted stock awards and options, (iv)the continuation of certain employee welfare plan benefits, including for his or her dependents and beneficiaries, for a period of 12 months following the termination date or until the officer becomes eligible for equivalent benefits from a subsequent employer, and (v)outplacement services for a period of 12 months following the termination date or until the first acceptance by the officer of an offer of employment, whichever comes first.

Upon termination of the officer’s employment by the Company without cause or by the officer for good reason within 18 months after a change in control, the officer is entitled to receive: (i)1.5x the sum of his or her base salary and annual target bonus for the fiscal year in which termination occurs or for the previous fiscal year if the annual target bonus for the fiscal year has not yet been set (2.5x for the Company’s Chief Executive Officer), (ii)a prorated target bonus for the fiscal year in which termination occurs, (iii)acceleration of vesting and exercisability of restricted stock awards and options, (iv)vesting of any performance-based restricted stock units still eligible to vest, (v)the continuation of certain employee welfare plan benefits, including for his or her dependents and beneficiaries, for a period of 12 months following the termination date or until the officer becomes eligible for equivalent benefits from a subsequent employer, and (vi)outplacement services for a period of 12 months following the termination date or until the first acceptance by the officer of an offer of employment, whichever comes first.

The Plan also provides for the officer receiving the following severance benefits if the officer’s employment is terminated by reason of the officer’s death or disability:(i)1.0x the sum of his or her base salary and annual target bonus for the fiscal year in which termination occurs or for the previous fiscal year if the annual target bonus for the fiscal year has not yet been set (1.5x for the Company’s Chief Executive Officer), (ii)a prorated target bonus for the fiscal year in which termination occurs, and (iii)the continuation of certain employee welfare plan benefits, including for his or her dependents and beneficiaries, for a period of 12 months following the termination date or until the officer becomes eligible for equivalent benefits from a subsequent employer.