Company: AVD
Filing Date: 2025-05-29
Form Type: DEF 14A
Source: 0000950170-25-079166
Chunk: 32

Company: AMERICAN VANGUARD CORP
Filing Date: 2025-05-29
Form: DEF 14A
Chunk 32
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 work of the Chief Executive Officer, Chief Operating Officer and Chief Transformation Officer pending the hiring of a new CEO, and a new CEO was successfully recruited and hired by year end.

In the midst of these changes, the Company’s performance in 2024 declined as compared to the prior year. While adjusted EBITDA was within the targeted range, and net sales were marginally lower than the prior year, due largely to persistently low commodity prices, the Company recorded a significant net loss arising from significant nonrecurring charges (including with respect to transformation expenses, inventory reserves, impaired assets and goodwill, among others). That said, the Company believes that it is poised to move into the future with an improved balance sheet and a focus to “simplify, execute and deliver” as per the mantra of its new CEO.

In light of 2024 performance, neither the incumbent CEO nor any of the other NEOs received any cash bonus for 2024 performance. Thus, the cash bonus and total direct compensation for the CEO were below the 25thpercentile of the CEOs of the Company’s Proxy Peers (as defined below). The CEO’s equity award was at about the median of the Proxy Peers and was made with an eye toward incentivizing future value creation, including options that carried additional TSR triggers at $20 and $25 per share that must be achieved before vested options can be exercised. With respect to the cash bonus, total direct compensation and equity award, the other NEOs were below the 25thpercentile of the Company’s proxy peers. The Company’s one-year, three-year and five-year total shareholder return (“TSR”) was below the 25thpercentile of its Proxy Peers. The Company believes that, overall, executive compensation for 2024 was consistent with the rubric of pay-for-performance.

Compensation Objectives

Our executive compensation program has three primary objectives to:

Align management’s interests with the long-term interests of stockholders;

Provide compensation on the basis of performance that supports key financial and strategic business outcomes; and

Attract, motivate and retain top talent to lead our business.

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Our first objective is accomplished by ensuring that our executives are stockholders. We do this through the regular awards of equity, whether in the form of restricted stock, options or performance-based shares/options, and the adoption of executive stock ownership guidelines. We make these equity awards through our 2022 stock incentive plan (the "2022 Plan"), which was most recently approved