Adil Engineer
AEHR TEST SYSTEMSAbout Adil Engineer
Adil Engineer is Chief Operating Officer (COO) of Aehr Test Systems, age 48 as of May 30, 2025; he joined Aehr in April 2022 after senior roles across operations, manufacturing engineering, new product introduction, and supply chain at KLA‑Tencor, Coherent, Kateeva, and Tecan Group AG . He holds a B.S. in Chemical Engineering from TKIET and a Graduate Certificate in Management Science and Engineering from Stanford University . As COO, he has primary responsibility for enterprise cybersecurity risk management and briefed the Audit Committee three times in FY2025, reflecting expanding operational scope into information security governance . Company performance during his tenure was mixed: revenue fell 10.9% in FY2025 to $59.0M with a net loss of $3.9M after a strong FY2024, and the SEC “Pay vs. Performance” table shows the value of an initial $100 investment at $114 for FY2025 (down from $394 in FY2023) .
Company performance context (Aehr Test Systems):
| Metric | FY 2023 | FY 2024 | FY 2025 |
|---|---|---|---|
| Revenue ($ thousands) | $64,961 | $66,218 | $58,968 |
| Net Income (Loss) ($ thousands) | $14,557 | $33,156 | $(3,910) |
| Value of Initial $100 Investment (TSR) | $394 | $137 | $114 |
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Tecan Group AG | Head of Operations (US manufacturing site) | Not disclosed | Led operations at primary US site for medical test/diagnostic equipment manufacturer . |
| KLA‑Tencor (now KLA Corporation) | Various roles in manufacturing, engineering, NPI, supply chain | 11 years | Core semiconductor equipment operating experience across manufacturing engineering and NPI . |
| Coherent (now Coherent Corporation) | Operations/manufacturing roles | Not disclosed | Laser/optical tech operations exposure . |
| Kateeva | Operations/manufacturing roles | Not disclosed | Advanced electronics manufacturing equipment (inkjet deposition) experience . |
External Roles
No public company directorships or external board roles are disclosed for Mr. Engineer in the company’s executive officer bios in the DEF 14A filings .
Fixed Compensation
| Component | FY 2025 |
|---|---|
| Base Salary | $327,600 |
Notes:
- Mr. Engineer was a Named Executive Officer (NEO) beginning in FY2025; prior-year base salary for him is not disclosed in the FY2024 proxy .
Performance Compensation
Annual incentives (FY2025):
| Metric | Target | Actual | Payout ($) | Vesting/Timing |
|---|---|---|---|---|
| Profit-based cash bonus | $45,000 | Company performance missed threshold | $0 | Annual assessment . |
| Personal performance cash bonus | $110,000 | Achieved vs. milestones | $91,250 | Annual assessment . |
Equity program design highlights:
- Aehr granted only RSUs and PRSUs to executive officers in FY2025; equity awards generally vest quarterly (time-based) or upon meeting defined performance metrics, then time-vest thereafter .
- FY2025 PRSU structures included (a) cumulative revenue for certain markets through May 31, 2026 (all-or-nothing at 100% upon achievement) and (b) FY2025 financial goals with up to 200% maximum, with 25% earned at performance determination and the remainder time-vesting over three years .
Equity Awards (Grants, Vesting, Status at FY2025)
| Grant Date | Instrument | Shares | Performance/Metric | Vesting Terms | Status/Value at 5/30/25 |
|---|---|---|---|---|---|
| 4/6/2022 | Stock Options | 36,155 exercisable / 13,257 unexercisable (tranche 1) | N/A | 1/48 monthly; $9.45 strike; expires 4/6/2029 | Outstanding . |
| 4/6/2022 | Stock Options | 29,365 exercisable / 6,223 unexercisable (tranche 2) | N/A | 1/48 monthly; $9.45 strike; expires 4/6/2029 | Outstanding . |
| 10/27/2023 | Time-based RSUs | 3,956 | N/A | 1/16 quarterly | Unvested; $37,740 MV at $9.54 close . |
| 10/27/2023 | PRSUs | 5,167 | Cumulative revenue to 5/31/2026 | 100% upon target achievement | Not yet achieved as of 5/30/25; $49,293 MV for these unearned units . |
| 7/11/2024 | Time-based RSUs | 13,981 | N/A | 1/16 quarterly | Unvested; $133,379 MV . |
| 7/11/2024 | PRSUs (FY2025 financial goals) | 5,692 original target; 2,276 earned at 200% max | FY2025 financial goals | 25% at achievement; remainder 1/16 quarterly over next 3 years | 2,276 unvested earned units; $21,713 MV; 4,554 cancelled . |
| 7/11/2024 | PRSUs (multi‑year revenue) | 13,236 | Cumulative revenue to 5/31/2026 | 100% upon target achievement | Not yet achieved; $126,271 MV for these unearned units . |
Notes:
- “MV” reflects the closing price of $9.54 on May 30, 2025 used by the company for table valuations .
- Company policy prohibits repricing of options/SARs without shareholder approval and subjects all awards to the clawback policy .
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Beneficial ownership | 88,723 shares (<1%); includes 74,374 options exercisable within 60 days and 2,687 RSUs vesting within 60 days (as of August 28, 2025) . |
| ESPP participation (lifetime through Record Date) | 6,182 shares purchased; aggregate purchase price $58,864 . |
| Hedging/pledging | Company policy prohibits short sales, options/derivatives, hedging, margin purchases, and pledging of company stock . |
Employment Terms
Change-in-control and severance (agreement dated August 31, 2024 for COO):
| Scenario | Cash Severance (Salary) | Bonus Severance | Equity Acceleration | Healthcare |
|---|---|---|---|---|
| Qualifying termination during CIC period (3 months before through 12 months after a change in control) | 12 months | 100% of target annual cash incentive + prorated target bonus for the year | Full acceleration of time-based awards; PRSUs deemed achieved at greater of target or expected attainment as determined by Board/Comp Committee | Up to 12 months paid by company . |
| Qualifying termination outside CIC period | 6 months | Prorated target bonus for the year | 6 months’ acceleration of unvested awards; PRSUs deemed achieved at target | Up to 6 months paid by company . |
| Death | Same as non‑CIC severance (except no healthcare continuation) | Prorated target bonus for the year | 6 months’ acceleration; PRSUs at target | No healthcare continuation . |
| Disability | Same as non‑CIC severance | Prorated target bonus for the year | 6 months’ acceleration; PRSUs at target | 6 months continuation in supplemental plan at company cost . |
Additional governance:
- Clawback policy adopted August 14, 2023 (Dodd‑Frank/Nasdaq compliant), enabling recovery of excess incentive compensation upon a material restatement .
- Company insider trading policy applies to all officers and prohibits hedging and pledging transactions .
Compensation Structure Analysis
- Mix skewed to equity/at-risk pay: In FY2025, Engineer’s compensation was $327,358 salary, $545,993 stock awards (grant-date fair value), $91,250 non‑equity incentive, and $27,644 other, totaling $992,245, indicating a heavy equity component aligned with multi‑year performance .
- Shift toward RSUs: The company granted only RSUs/PRSUs to executives in FY2025; option grants on Engineer’s profile date back to 2022, consistent with the move from options to RSUs that lower risk and emphasize retention .
- Performance metrics design: Revenue‑linked PRSUs (cumulative market revenue through FY2026) and FY2025 financial goals (with up to 200% payout) indicate emphasis on top‑line growth and annual operating milestones; a portion at max (200%) was earned, while other PRSUs were cancelled for not meeting targets .
Risk Indicators & Red Flags
- Pledging/hedging is prohibited, mitigating misalignment risks from collateralized or hedged insider positions .
- All awards are subject to a clawback in case of material restatement, reducing recoupment risk to shareholders .
- FY2025 saw a company net loss and lower gross margin due to mix, acquisition amortization/adjustments, and lower factory efficiencies, underscoring execution sensitivity; R&D and SG&A increased, partly from the Incal acquisition .
Investment Implications
- Alignment: High equity weighting (time‑based and performance‑based RSUs) and policy restrictions on hedging/pledging align the COO with long‑term shareholder value; revenue‑linked PRSUs directly tie outcomes to growth execution in key markets through FY2026 .
- Retention vs. acceleration: Double‑trigger CIC protection plus meaningful unvested equity create retention incentives but also imply potential accelerated vesting upon a transaction (watch for deal‑related overhang) .
- Flow‑through selling pressure: Quarterly 1/16 RSU vesting and earned PRSUs create periodic liquidity events; monitor Form 4 filings and any 10b5‑1 plans for cadence and size of sales around vest dates .
- Execution risk: Company revenue declined in FY2025 and TSR contracted relative to FY2023 peaks; successful realization of AI/packaged‑part growth vectors post‑Incal and achievement of multi‑year revenue PRSUs will be key signals for improved alignment and upside .