DEF 14A 1 tm218127-1_def14a.htm DEF 14A tm218127-1_def14a - none - 16.3904686s
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
(Amendment No.  )
☒   Filed by the Registrant
☐ Filed by a Party other than the Registrant
Check the appropriate box:

Preliminary Proxy Statement

CONFIDENTIAL, FOR USE OF THE COMMISSION ONLY (AS PERMITTED BY RULE 14a-6(e)(2))

Definitive Proxy Statement

Definitive Additional Materials

Soliciting Material Under Rule 14a-12
Avanos Medical, Inc.
(Name of Registrant as Specified in its Charter)
(Name of Person(s) Filing Proxy Statement, if Other than the Registrant)
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Check box if any part of the fee is offset as provided by Exchange Act Rule 01-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, of the Form or Schedule and the date of its filing.
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20
NOTICE OF ANNUAL MEETING
OF STOCKHOLDERS
AND PROXY STATEMENT
21
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April 29, 2021
9:00 a.m. Eastern time
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www.virtualshareholder
meeting.com/AVNS2021

COMPANY OVERVIEW
Avanos Medical, Inc. is a medical technology company focused on delivering clinically superior breakthrough medical device solutions to improve patients’ quality of life. Headquartered in Alpharetta, Georgia, Avanos is committed to addressing some of today’s most important
healthcare needs, such as reducing the use of opioids while helping patients move from surgery to recovery. We develop, manufacture and market clinically superior solutions in more than 90 countries.
Our Two Portfolios
PAIN MANAGEMENT
CHRONIC CARE

comprised of acute pain and interventional pain, which is focused on improving patient outcomes and reducing opioid usage

Avanos is a leader in non-opioid pain therapies

comprised of digestive health and respiratory health solutions focused on improving patient outcomes and increasing patient safety

Avanos has market-leading positions and clinically preferred solutions across its key product offerings, with a strong brand portfolio
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Avanos Medical, Inc.
5405 Windward Parkway
Alpharetta, Georgia 30004
MESSAGE FROM OUR CEO
March 19, 2021​
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FELLOW
STOCKHOLDERS,
It is my pleasure to invite you to the Annual Meeting of Stockholders of Avanos Medical, Inc. (the “Company”). The meeting will be held on Thursday, April 29, 2021, at 9:00 a.m. Eastern time. Due to the continuing public health risks posed by COVID-19, the Annual Meeting will be a virtual-only meeting, held solely by means of remote communication at www.virtualshareholdermeeting.com/AVNS2021.
At the Annual Meeting, stockholders will be asked to

elect the two directors named in the proxy statement for a one-year term,

ratify the selection of the Company’s independent auditors,

approve a non-binding resolution to approve the compensation for our named executive officers,

approve a non-binding resolution to approve the frequency of stockholder votes on our named executive officers’ compensation, and

approve our 2021 Long Term Incentive Plan.
These matters are fully described in the accompanying Notice of Annual Meeting and proxy statement.
Your vote is important. Regardless of whether you plan to attend the meeting, we urge you to vote your shares as soon as possible. You may vote using the included proxy card by completing, signing, and dating it, then returning it by mail. You may also vote your shares by using the telephone or internet by following the instructions set forth on the proxy card. Additional information about voting your shares is included in the proxy statement.
Sincerely,
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Joseph F. Woody
Chief Executive Officer

AVANOS MEDICAL, INC.
NOTICE OF 2021 ANNUAL MEETING OF STOCKHOLDERS
To Be Held on April 29, 2021
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WHEN
Thursday, April 29, 2021 9:00 a.m. Eastern Time
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WHERE
www.virtualshareholder
meeting.com/AVNS2021
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RECORD DATE
Stockholders of record at the close of business on March 5, 2021 are entitled to notice of and to vote at the meeting
Matters to be Voted on at the Annual Meeting
Proposals
1
To elect as directors the two nominees named in the accompanying proxy statement for a one-year term;
4
To approve a non-binding resolution to approve the frequency of stockholder votes on our named executive officers’ compensation;
2
To ratify the selection of Deloitte & Touche LLP as our independent auditors for 2021;
5
To approve our 2021 Long Term Incentive Plan; and,
3
To approve a non-binding resolution to approve the compensation of our named executive officers;
6
To take action upon any other business that may properly come before the meeting or any adjournments of the meeting.
Stockholders of record at the close of business on March 5, 2021, are entitled to notice of and to vote at the meeting or any adjournments.
To attend the virtual meeting, please register by following the instructions on page   . Regardless of whether you plan to attend the virtual meeting, we ask that you nevertheless vote promptly by using the telephone or internet or by signing,
dating, and returning the enclosed proxy card. You may revoke your proxy and vote your shares at the meeting if you would like to do so.
If you own shares in a brokerage account, your broker cannot vote your shares for Proposals 1, 3, 4, 5 or 6 unless you provide voting instructions to your broker. It is important that you exercise your right as a stockholder and vote on all Proposals.
By Order of the Board of Directors.
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Ross Mansbach
Senior Vice President, General Counsel
(Interim) and Corporate Secretary
March 19, 2021
IMPORTANT NOTICE REGARDING AVAILABILITY OF PROXY MATERIALS FOR
THE STOCKHOLDERS MEETING TO BE HELD ON APRIL 29, 2021
This proxy statement along with a proxy card and our Annual Report on Form 10-K for the fiscal year ended December 31, 2020, are available at www.proxyvote.com.

PROXY STATEMENT
Table of Contents
1 2021 PROXY STATEMENT SUMMARY
9 INFORMATION ABOUT OUR ANNUAL MEETING
9
How We Provide Proxy Materials
9
Who May Vote
10
How to Vote
10
How to Revoke or Change Your Vote
10
Votes Required
11
How Withhold Votes and Abstentions Will Be Counted
11
Effect of Not Instructing Your Broker
12
Attending the Annual Meeting
12
Costs of Solicitation
13 CORPORATE GOVERNANCE
13
Board Leadership Structure
14
Director Independence
14
Board Meetings
14
Board Committees
20
Communicating with Directors
20
Other Corporate Governance Policies and Practices
PROPOSAL 1. ELECTION OF DIRECTORS
22
Process and Criteria for Nominating Directors
24
Committee Review of Attributes of Current Directors
24
Diversity of Directors
24
The Nominees
26
Directors Continuing in Office
30
Director Compensation
31
2020 Outside Director Compensation
PROPOSAL 2. RATIFICATION OF AUDITORS
33
Accounting Firm Fees
33
Audit Committee Approval of Audit and Non-Audit Services
34
Audit Committee Report
Proposal 3. Advisory Vote to Approve Named Executive Officer Compensation
36 Compensation Discussion and Analysis
37
Compensation Executive Summary
40
Executive Compensation Objectives and Policies
41
Executive Compensation Design Philosophy and Guiding Principles
42
Components of Our Executive Compensation Program
43
Setting Annual Compensation
45
Executive Compensation for 2020
50
Benefits and Other Compensation
51
Additional Information About Our Compensation Practices
53
Compensation Committee Report
54
Analysis of Compensation-Related Risks
55 COMPENSATION TABLES
55
SUMMARY COMPENSATION
55
Summary Compensation Table
57
Grants of Plan-Based Awards Table
58
Discussion of Summary Compensation and Plan-Based Awards Tables
58
Outstanding Equity Awards
59
Outstanding Equity Awards as of December 31, 2020
60
Option Exercises and Stock Vested
60
Pension Benefits
60
Nonqualified Deferred Compensation
61
Potential Payments on Termination or Change of Control
66
Ratio of CEO Compensation to Median Employee Compensation
Proposal 4. ADVISORY VOTE ON FREQUENCY OF AN ADVISORY VOTE ON NAMED EXECTIVE OFFICER COMPENSATION
68
Proposal 5. APPROVAL OF OUR 2021 LONG TERM INCENTIVE PLAN
68
Promotion of Sound Corporate Governance Practices
69
Key Data Relating to Outstanding Equity Awards and Shares Available
69
Summary of the 2021 Plan
71
Federal Income Tax Consequences
73 Other Information
73
Security Ownership Information
75
Transactions with Related Persons
75
Stockholders Sharing the Same Household
75
2022 Stockholder Proposals
76
Stockholder Nominations for Board of Directors
76
Annual Meeting Advance Notice Requirements
77
Annual Report
78 Other Matters to be Presented at the Meeting
Appendix A – Reconciliations of Non-GAAP Financial Measures
B-1 Appendix B – AVANOS MEDICAL, INC. 2021 LONG TERM INCENTIVE PLAN

2021 PROXY STATEMENT SUMMARY
This summary represents only selected information. You should review the entire proxy statement before voting.
Avanos Medical, Inc. 2021 Annual Meeting of Stockholders
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WHEN
Thursday, April 29, 2021 9:00 a.m. Eastern Time
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WHERE
www.virtualshareholder
meeting.com/AVNS2021
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RECORD DATE
Stockholders of record at the close of business on March 5, 2021 are entitled to notice of and to vote at the meeting
MATTERS TO BE VOTED ON AT THE ANNUAL MEETING
Proposal
Description
Board
Recommendation
See Page
1.
Election of Directors
Election of Gary Blackford and Patrick O’Leary to serve one-year terms expiring at the 2022 Annual Meeting of Stockholders
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FOR
both
nominees
2.
Ratification of Appointment
of Auditors
Ratification of the appointment of Deloitte & Touche LLP as our independent auditors for 2021
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FOR
3.
Say-on-Pay
Stockholder advisory vote on the compensation of our named executive officers
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FOR
4.
Say-on-Frequency
Stockholder advisory vote to approve the frequency of stockholder votes on our named executive officers’ compensation
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FOR
option of
every one year
5.
2021 Long Term Incentive Plan
Approval of our 2021 Long Term Incentive Plan
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FOR
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2021 Notice and Proxy Statement1

2021 PROXY STATEMENT SUMMARY
   

PROPOSAL 1. ELECTION OF DIRECTORS
Information about the two nominees for director is included below.
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The Board of Directors unanimously recommends that stockholders vote FOR the election of each of these nominees.
Name and Occupation
Committee Roles
Independent
Experience Highlights
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Gary D. Blackford

Chairman of the Board
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Executive leadership as Chief Executive Officer

Financial literacy and experience in finance

Knowledge of, and experience in, the healthcare industry

International experience

Governance and public company board experience

Former Chairman and CEO, Universal Hospital Services
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Patrick J. O’Leary

Audit Committee (Chair)

Compensation Committee
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Executive leadership as Chief Financial Officer

Financial literacy and experience in finance

International experience

Governance and public company board experience

Former Executive Vice President and CFO, SPX Corporation

PROPOSAL 2. RATIFICATION OF APPOINTMENT OF AUDITORS
For 2021, the Audit Committee has selected Deloitte & Touche LLP (“Deloitte”) as the independent registered public accounting firm to audit our financial statements. The Audit Committee and the Board believe that the continued retention of Deloitte to serve as our independent auditor is in the best interests of the Company and its stockholders.
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The Board of Directors unanimously recommends voting FOR the ratification of Deloitte as our independent auditors for 2021.
   
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22021 Notice and Proxy Statement

2021 PROXY STATEMENT SUMMARY​

PROPOSAL 3. SAY-ON-PAY
Last year, stockholders approved the compensation of our named executive officers with the highest vote FOR in the history of the company. Management believes this was a result, in large part, of our engagement process with stockholders, during which we listened to constructive feedback and, in consultation with our Compensation Committee’s independent compensation consultant, made changes to our executive compensation program. We believe those changes resulted in a compensation program in 2020, including as applied to the named executive officers, that appropriately incents management, reflects the objective of pay-for-performance, and is generally aligned with our overall business strategy, values, and management initiatives. The Compensation Committee believes that the executive compensation program is also aligned with stockholder interests.
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The Board of Directors unanimously recommends a vote FOR the compensation of our named executive officers.

PROPOSAL 4. SAY-ON-FREQUENCY
This proposal gives stockholders the opportunity to indicate, on a non-binding advisory basis, how frequently we should seek an advisory say-on-pay vote. Our Board has determined that, consistent with our practice to date, an advisory say-on-pay vote that occurs every year is the most appropriate alternative for the Company. This will allow stockholders to provide us with their direct input on our compensation objectives, policies and practices as disclosed in the proxy statement every year.
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The Board of Directors unanimously recommends a vote FOR the option of every ONE YEAR as the frequency with which stockholders are provided an advisory vote on the compensation of our named executive officers.

PROPOSAL 5. ADDITIONAL SHARES FOR 2021 LONG TERM INCENTIVE
PLAN
This proposal asks stockholders to approve our 2021 Long Term Incentive Plan (the 2021 Plan), which was approved by our Board of Directors on February 11, 2021, subject to stockholder approval at the Annual Meeting. The Compensation Committee believes the number of shares available for future awards under the prior plan will not be sufficient to make the grants it believes will be needed over the next few years to provide adequate long-term equity incentives to our key employees, consultants, and advisors. Considering our historical grant practices, we believe we have been judicious in our share usage under the prior plan, and mindful of potential stockholder dilution. Approval of the 2021 Plan will enable the Company to continue making equity compensation grants that serve as incentives to recruit and retain key employees and to continue aligning the interests of its employees with stockholders. Based on the number of requested shares to be reserved under the 2021 Plan and on our anticipated future grant cycles, we expect that the share reserve will be sufficient to cover future equity incentive awards for approximately 3 years.
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The Board of Directors unanimously recommends a vote FOR our 2021 Long Term Incentive Plan.
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2021 Notice and Proxy Statement3

2021 PROXY STATEMENT SUMMARY
HOW TO VOTE
Shareholders of Record Beneficial Owners
Have your proxy card in hand and follow the instructions.
If you are a beneficial owner and your shares are held in “street name” by a bank, broker or other nominee, you should follow the instructions provided to you by that firm.
Although most banks and brokers now offer voting by mail, telephone and internet, availability and specific procedures will depend on their voting arrangements.
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BY
TELEPHONE
Dial toll-free, 24/7
1-800-690-6903
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BY
INTERNET
Visit, 24/7
www.proxyvote.com
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BY
MAIL
Complete, date and sign your proxy card and send by mail in the enclosed postage-paid envelope
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BY
ATTENDING
Attend the virtual Annual Meeting and cast your ballot at www.virtualshareholdermeeting.com/​AVNS2021
The deadline to vote by phone or electronically is 11:59 p.m. Eastern time on April 28, 2021. If you vote by phone or electronically, you do not need to return a proxy card.
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42021 Notice and Proxy Statement

2021 PROXY STATEMENT SUMMARY​
BOARD OF DIRECTORS OVERVIEW
Director and
Principal Occupation
Age
Director
Since
Independent
Committee Memberships
Audit
Compensation
Compliance
Governance
Executive
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Gary D. Blackford
Former Chairman
and CEO, Universal
Hospital Services
63
2014
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John P. Byrnes
Former Chairman and
CEO, Lincare Holdings, Inc.
62
2014
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William A. Hawkins
Former President and
CEO, Medtronic, Inc.
67
2015
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Heidi Kunz
Former Executive Vice President and CFO, Blue Shield of California
66
2014
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Patrick J. O’Leary
Former Executive Vice President and CFO, SPX Corporation
63
2014
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Maria Sainz
Former CEO, Aegea Medical, Inc.
55
2015
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Julie Shimer, Ph.D.
Former CEO, Welch Allyn, Inc.
68
2014
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Joseph F. Woody
55
2017
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Number of meetings in 2020
Board — 11
7*
6
6*
5
0
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Chairman of the Board
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Committee Chair
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Committee Member
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Audit Committee financial expert
*
Includes one joint session of the Audit and Compliance Committees.
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2021 Notice and Proxy Statement5

2021 PROXY STATEMENT SUMMARY
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Environmental, Social and Governance (ESG) Matters and Other Corporate Governance Highlights
The Company believes that there is a direct connection between good corporate governance and long-term, sustained business success, and
we believe it is important to uphold sound governance practices.
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7 of our 8 directors are independent, including all members of our board committees
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Global Code of Conduct for directors and employees
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Separate Chairman and CEO roles
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Active stockholder engagement
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3 out of 8 directors are women
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Board responsibility for risk oversight
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Board composition is diverse in age, skills and experience
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Periodic review of long-term management development and succession plans
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Independent directors regularly meet without management present
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Commitment to Corporate Social Responsibility, diversity and inclusion and environmental stewardship
Being a good corporate citizen means that our care extends beyond the patients who benefit from our products. We’re also committed to operating ethically and responsibly and complying with all applicable regulations around the world. We partner with suppliers who mirror our integrity by offering quality products, while focused on operating safely and sustainably.
Our commitment to corporate citizenship is also reflected in our strong stand on opioid abuse — an epidemic with far-reaching societal effects. Avanos is committed to helping reduce and eliminate opioid abuse by offering alternate methods of pain relief. We believe that by living our values and working collaboratively, we will achieve our vision at being the best at getting patients back to the things that matter.
Our commitment is also reflected in our creation of an ongoing initiative in 2020 called We Stand Together that will develop a Diversity, Equity &
Inclusion (“DE&I”) plan aimed at strengthening the engagement and motivation of everyone in our global workforce. As part of that effort, we created a DE&I Council. Led by Mizanu Kebede, our Senior Vice President, Global Quality, Regulatory & Product Safety, the Council comprises employees from various salary levels, staff departments and geographic regions throughout the Company. The Council plays a critical role in helping us (i) implement Avanos’ DE&I strategy and policies, (ii) ensure that DE&I is an integral part of the Avanos culture, (iii) manage the DE&I endeavor and provide governance and oversight, (iv) continue action items from the We Stand Together initiative, (v) advise senior leadership on Avanos’ DE&I strategies and ensure alignment with our overall business strategy, while capturing suggestions for improvements, and (vi) recommend actions to implement, enhance and drive accountability for DE&I metrics.
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62021 Notice and Proxy Statement

2021 PROXY STATEMENT SUMMARY​
0.13
2020 incident rate per 100 employees
83%
manufacturing waste diverted from landfills
42%
women among global salaried employees
31%
minorities among global salaried employees
2020 Business Highlights
As Mr. Woody indicated when announcing our Fourth Quarter and Full Year 2020 results, “I’m pleased with our team’s execution and accomplishments in 2020 highlighted by our cost savings, the integration of our recent acquisitions and free cash flow improvement throughout the year, while successfully responding to the challenges presented by the pandemic.” He continued, “We enter 2021 in a strong position and are poised to execute on our plan to accelerate top-line growth, drive margin improvement and generate free cash flow in 2021 and beyond.”
Our 2020 financial highlights include:

Net sales increased 3 percent to $715 million.

Adjusted net income totaled $38 million, compared to $51 million in the prior year.

Adjusted diluted earnings per share totaled $0.79, compared to $1.07 in the prior year.
Our 2020 operational and business highlights include:

We implemented a COVID-19 restructuring program that included streamlining the senior
leadership team, consolidating other corporate functions to gain efficiencies and aligning office space with our post-pandemic work model. In total, we anticipate annual savings of approximately $7 million, which excludes intangible costs, and cash costs of  $10 million.

We presented new COOLIEF* data at the 19th Annual Pain Meeting hosted by the American Society of Regional Anesthesia and Pain Medicine. The 18 and 24-month follow-up results from its large, multicentered randomized clinical trial indicated that patients can see improvements in both pain and function lasting up to two years following a single COOLIEF* procedure.

The Centers for Medicare & Medicaid Service (CMS) released its 2021 Ambulatory Surgical Center (ASC) Payment System Final Rule, which favorably includes higher reimbursement for radiofrequency nerve ablation procedures in the knee when performed in an ASC setting.
$715M
net sales
3%
sales growth
$89.4M
adjusted EBITDA
$0.79
adjusted diluted EPS
$112M
cash on hand at year-end
Executive Compensation Highlights
Pay-for-performance is a key objective of our compensation program. Consistent with that objective, performance-based compensation constituted a significant portion of our named executive officers’total direct annual compensation for 2020. To further align the financial interests of our executives with those of our stockholders, a majority of our executives’ total direct annual compensation for 2020 was equity-based.
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2021 Notice and Proxy Statement7

2021 PROXY STATEMENT SUMMARY
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COMPENSATION PRACTICES AND POLICIES
The design principles for our executive compensation program are intended to protect and promote the interests of our stockholders.
WHAT WE DO
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Pay for performance
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Perform an annual compensation risk assessment
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Utilize an independent compensation consultant retained by the Compensation Committee
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Require that change-in-control agreements contain a double trigger
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Maintain stock ownership guidelines
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Maintain a clawback policy on incentive payments in case of financial restatement
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Benchmark our compensation practices to ensure executive compensation is competitive with our peer group
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Cap short and long-term incentive payments at reasonable levels
WHAT WE DON’T DO
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Maintain employment contracts
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Provide excise tax gross-up on change-in- control payments
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Allow repricing of underwater options without stockholder approval
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Allow current payment of dividends or dividend equivalents on unearned long- term incentives
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Allow executive officers to engage in hedging or pledging transactions involving Company stock
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82021 Notice and Proxy Statement

INFORMATION ABOUT OUR ANNUAL MEETING
On behalf of the Board of Directors of Avanos Medical, Inc. (the “Company”), we are soliciting your proxy for the 2021 Annual Meeting of Stockholders to be held:
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WHEN
Thursday, April 29, 2021 9:00 a.m. Eastern Time
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WHERE
www.virtualshareholder
meeting.com/AVNS2021
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RECORD DATE
Stockholders of record at the close of business on March 5, 2021 are entitled to notice of and to vote at the meeting
At the Annual Meeting, the stockholders will vote on the following matters:
Proposals
1
To elect as directors the two nominees named in this proxy statement for a one-year term;
4
To approve a non-binding resolution to approve the frequency of stockholder votes on our named executive officers’ compensation;
2
To ratify the selection of Deloitte & Touche LLP as our independent auditors for 2021;
5
To approve our 2021 Long Term Incentive Plan; and,
3
To approve a non-binding resolution to approve the compensation of our named executive officers;
6
To take action upon any other business that may properly come before the meeting or any adjournments of the meeting.
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Our Board of Directors recommends that you vote your shares FOR each of the proposals one through five.
How We Provide Proxy Materials
We began providing our proxy statement and form of proxy to stockholders on March 19, 2021.
As Securities and Exchange Commission (“SEC”) rules permit, we are making our proxy statement and our annual report available to many of our stockholders via the internet rather than by mail. This reduces printing and delivery costs and supports our sustainability efforts. You may have
received in the mail a “Notice of Electronic Availability” explaining how to access this proxy statement and our annual report on the internet and how to vote online. If you received this Notice but would like to receive a paper copy of the proxy materials, you should follow the instructions contained in the Notice for requesting these materials.
Who May Vote
If you were a stockholder of record at the close of business on March 5, 2021, you are eligible to vote at the meeting. Each share of our common stock that you own entitles you to one vote. Shares may not be voted cumulatively.
As of the record date, 48,058,419 shares of common stock were outstanding.
If your shares are held by a bank or brokerage firm, you are considered a “beneficial owner” of the shares held in “street name.” If your shares are
held in street name, your bank or brokerage firm (the record holder of your shares) forwarded to you these proxy materials, along with a voting instruction card. As the beneficial owner, you have the right to direct your record holder how to vote your shares, and the record holder is required to vote your shares in accordance with your instructions. If you do not give instructions to your bank or brokerage firm, it will nevertheless be entitled to vote your shares with respect to “routine” items but it will not be permitted to vote
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2021 Notice and Proxy Statement9

INFORMATION ABOUT OUR ANNUAL MEETING
your shares with respect to “non-routine” items. In the case of non-routine items, your shares
will be considered “broker non-votes” on those proposals.
How to Vote
If you are the record holder of our common stock as of the record date, you may vote by using the telephone or internet, by completing and returning the enclosed proxy card by mail, or by voting at the virtual meeting.
To vote by telephone or internet, see the instructions on the proxy card and have the proxy card available when you place your telephone call or access the internet website. To vote your proxy by mail, mark your vote on the proxy card, then follow the instructions on the card to return it by postage-prepaid mail.
If your shares are held in street name, please follow the instructions on the voting instruction card to vote your shares.
If you are the record holder of your shares and you attend the virtual meeting, you may vote at that time. Beneficial owners of shares held in street name who wish to vote at the virtual meeting will need to obtain a power of attorney or proxy from their record holder to do so.
If you return a completed and properly signed proxy card prior to the meeting, or if you vote by telephone or internet prior to the meeting, the persons named as proxies on the proxy card will
vote your shares according to your directions. The voting results will be certified by independent Inspectors of Election.
If you are a stockholder of record and you sign and return your proxy card, or if you vote by using the telephone or internet, but you do not specify how you want to vote your shares, the persons named as proxies on the proxy card will vote your shares as follows:

FOR the election of the two directors named in this proxy statement;

FOR ratification of the selection of our independent auditors for 2021;

FOR approval of the compensation of our named executive officers;

FOR approval of the frequency of one year for stockholder votes on our named executive officers’ compensation; and

FOR approval of our 2021 Long Term Incentive Plan.
If any other matters are properly presented at the Annual Meeting for consideration, the persons named as proxies on the proxy card will vote as recommended by the Board of Directors or, if no recommendation is given, in their discretion.
How to Revoke or Change Your Vote
If you are a stockholder of record, there are several ways to revoke or change your vote:

Mail a revised proxy card with a later date or a written notice of revocation with a later date to the Corporate Secretary of the Company (the revised proxy card or notice of revocation must be received by close of business on April 28, 2021). Use the following address:
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Avanos Medical, Inc.
Attn: Corporate Secretary
5405 Windward Parkway
Suite 100 South
Alpharetta, GA 30004

Use the telephone voting procedures or internet voting website (the revocation or change must be completed by 11:59 p.m. Eastern time on April 28, 2021).

Attend the virtual meeting and vote. Please note that attendance at the meeting will not revoke a proxy if you do not actually vote at the meeting.
If you hold your shares in street name, the above options for changing your vote or revoking your instructions do not apply and you must follow the instructions received from your bank or broker to change your vote or revoke your proxy.
Votes Required
There must be a quorum to conduct business at the Annual Meeting, which is established by having a majority of the outstanding shares of our common stock present in person or represented
by proxy at the virtual meeting. If you vote, your shares will be included in the number of shares to establish the quorum. Abstentions (or “Withhold” votes for the elections of directors) or
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102021 Notice and Proxy Statement

INFORMATION ABOUT OUR ANNUAL MEETING​
proxy cards returned without voting instructions and broker non-votes will be counted as present
for the purpose of determining whether the quorum requirement is satisfied.
Proposal
Voting Policy
1
Election of directors
Plurality plus
2
Ratification of appointment of auditors
Affirmative vote of a majority of shares present and entitled to vote
3
Say on Pay
Affirmative vote of a majority of shares present and entitled to vote
4
Say on Frequency
Affirmative vote of a majority of shares present and entitled to vote
5
Approval of 2021 Long Term Incentive Plan
Affirmative vote of a majority of shares present and entitled to vote
How Withhold Votes and Abstentions Will Be Counted
ELECTION OF DIRECTORS
“Withhold” votes for the election of directors will be counted for the purpose of determining the
presence of a quorum and the number of votes cast and, in effect, as votes “against” a nominee.
OTHER PROPOSALS
Abstentions will be counted:

in determining the presence of a quorum,

in determining the total number of shares entitled to vote on a proposal, and

as votes against a proposal.
Effect of Not Instructing Your Broker
ROUTINE MATTERS
If your shares are held in street name and you do not instruct the broker on how to vote your shares, your broker may choose to leave your shares unvoted or to vote your shares on routine
matters. “Proposal 2 — Ratification of Auditors” is the only routine matter on the agenda at this year’s Annual Meeting.
NON-ROUTINE MATTERS
Without instructions from you on how to vote your shares, your broker cannot vote your shares on non-routine matters, including Proposals 1, 3, 4, 5 and 6, resulting in what are known as “broker non-votes.” Broker
non-votes will not be considered present or entitled to vote on non-routine matters and will also not be counted for the purpose of determining the number of votes cast on these proposals.
ELECTION OF DIRECTORS
The Company has a “plurality-plus” voting policy for directors in uncontested elections. Under our “plurality-plus” voting policy, if any nominee for director receives a greater number of votes “withheld” than votes “for” such nominee in an uncontested election, he or she will promptly tender his or her resignation. The Governance Committee, without the participation of the director who tendered his or her resignation, will
then take action to accept or reject the director’s resignation and submit its recommendation to the full Board of Directors. The full Board of Directors, without the participation of the director who tendered his or her resignation, will accept or reject the resignation within 90 days of the certification of the election results and, if it chooses not to accept the resignation, will promptly disclose its decision in a Form 8-K or
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2021 Notice and Proxy Statement11

INFORMATION ABOUT OUR ANNUAL MEETING
other filing with the SEC. Further details about our “plurality plus” policy are included in our Corporate Governance Policies, which are available
in the Investors section of our website at www.avanos.com.
OTHER PROPOSALS OR MATTERS
Approval of other matters at the Annual Meeting requires the affirmative vote of a majority of shares that are present at the virtual meeting (in person or by proxy) and entitled to vote on the proposal.
If you are a stockholder of record and you do not sign and return a proxy card or vote by telephone or internet, your shares will not count toward the quorum requirement and will not affect the outcome of any proposal at the Annual Meeting.
Attending the Annual Meeting
If you are a stockholder of record, you or your duly appointed representative may attend the virtual Annual Meeting. Returning your proxy card will not affect your right to attend the Annual Meeting and to vote. If you do plan to attend, we ask that you inform us electronically, by telephone, or by checking the appropriate box on your proxy form.
If you are not a stockholder of record but hold shares as a beneficial owner in street name, you may be required to provide proof of beneficial ownership such as your account statement reflecting your ownership as of the Record Date,
a copy of the voting instruction provided by your broker, bank, trustee, or nominee, or other similar evidence of ownership.
If you have questions about the meeting, please contact Stockholder Services:
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BY
PHONE
470-448-5000
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BY
E-MAIL
stockholderservices@avanos.com
Costs of Solicitation
The Company will bear all costs of this proxy solicitation, including the cost of preparing, printing and delivering materials, and the out-of-pocket expenses of brokers, fiduciaries and other nominees who forward proxy materials to stockholders. In addition to mail and electronic means, our employees may solicit proxies by
telephone or otherwise. Our employees will not receive additional compensation for such solicitations. We have retained D. F. King & Co., Inc., to aid in the solicitation at a cost of approximately $11,500 plus reimbursement of out-of-pocket expenses.
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122021 Notice and Proxy Statement

CORPORATE GOVERNANCE
Our governance structure and processes are based on a number of important governance documents including our Code of Conduct, Certificate of Incorporation, Corporate Bylaws, Corporate Governance Policies and our Board Committee Charters. These documents, which are available in the Investors section of our website at www.avanos.com, guide the Board and our management in the execution of their responsibilities.
The Company believes that there is a direct connection between good corporate governance and long-term, sustained business success, and we believe it is important to uphold sound governance practices. As such, the Board reviews its governance practices and documents on an
ongoing basis, and it considers changing regulatory requirements, governance trends, and issues raised by our stockholders. After careful evaluation, we may periodically make governance changes in view of these matters to maintain current good governance practices and promote stockholder value.
We believe we are in compliance with all applicable corporate governance requirements of the New York Stock Exchange (“NYSE”), the SEC, the Sarbanes-Oxley Act of 2002 and the provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 that have become effective as of the date of this proxy statement.
Board Leadership Structure
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Gary Blackford has served as the Chairman of the Board (“Chairman”) since April 30, 2020, when the former Chairman retired from the Board. It is the Board’s view at this time that having separate Chairman and CEO roles promotes candid discourse and responsible corporate governance.
The Board, however, retains the discretion to combine the Chairman and CEO roles and appoint an independent lead director at any time if it deems that to be in the best interest of our Company and stockholders.
Consistent with this leadership structure, at least once a quarter our Chairman, who is an independent director, chairs executive sessions of our non-management directors. Members of the Company’s senior management team do not attend these sessions.
Gary Blackford serves as our independent Chairman. Our Corporate Governance Policies outline the significant roles and responsibilities of the Chairman, which include:

Presiding over meetings of the Board and stockholders and providing perspective to the CEO regarding discussions at these meetings

Chairing executive sessions at which non-management directors meet outside management’s presence, and providing feedback from such sessions to the CEO

Serving as the Chair of the Executive Committee

Coordinating the activities of the independent directors and serving as a
liaison between the independent directors, as a group, and the CEO

Approving agendas and schedules for Board meetings

Reviewing, approving, and revising materials for distribution to the Board, in connection with Board meetings or otherwise, as appropriate

Leading (with the Chairman of the Governance Committee) the annual Board evaluation

Leading (with the Chairman of the Compensation Committee) the Board’s review and discussion of the CEO’s performance and compensation

Providing feedback to individual directors following their periodic evaluations

Acting as a direct conduit to the Board for stockholders, employees, and others according to the Board’s policies

Assuming such other responsibilities that the Board may designate from time to time.
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2021 Notice and Proxy Statement13

CORPORATE GOVERNANCE
Director Independence
We believe our independent board helps ensure good corporate governance and strong internal controls.
Our Corporate Governance Policies provide independence standards consistent with the rules and regulations of the SEC and the listing standards of the NYSE. Our independence
standards can be found in Section 17 of our Corporate Governance Policies.
The Governance Committee of the Board has determined that all directors and nominees are independent directors, other than Mr. Woody, and meet the independence standards in our Corporate Governance Policies.
Board Meetings
11
Board meetings held in 2020

100%
of directors attended > 75% of Board and applicable committee meetings
100%
attendance at 2020 annual meeting of stockholders by all directors
The Board of Directors met 11 times in 2020. All of the directors attended in excess of 75 percent of the total number of meetings of the Board and the committees on which they served.
Although we do not have a formal policy with respect to director attendance at annual meetings,
all directors attended the 2020 Annual Meeting, and we expect that all directors will be in attendance at the Annual Meeting on April 29, 2021.
Board Committees
In 2020, the standing committees of the Board included the:

Audit Committee

Compensation Committee

Compliance Committee

Governance Committee

Executive Committee
In compliance with applicable NYSE corporate governance listing standards, the Board has
adopted charters for all Committees except the Executive Committee.
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Our Committee charters are available in the Investors section of our website at www.avanos.com.
As set forth in our Corporate Governance Policies, and in the charter of each individual Committee, the Board’s Committees all have the authority to retain independent advisors and consultants, with all costs paid by the Company.
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142021 Notice and Proxy Statement

CORPORATE GOVERNANCE​
Committee Memberships
Director
Independent
Audit
Compensation
Compliance
Governance
Executive
Gary D. Blackford [MISSING IMAGE: tm2011277d2-icon_chairmanbw.jpg]
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John P. Byrnes
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William A. Hawkins
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Heidi Kunz
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Patrick J. O’Leary
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[MISSING IMAGE: tm2011277d3-icon_circlecpms.jpg] [MISSING IMAGE: tm2011277d3-icon_circlecbw.jpg]
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Maria Sainz
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Julie Shimer, Ph.D.
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Joseph F. Woody
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Committee meetings in 2020
7*
6
6*
5
0
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Chairman of the Board
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Committee Chair
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Committee Member
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Audit Committee financial expert
*Includes one joint session of the Audit and Compliance Committees.
[MISSING IMAGE: ico_auditcommittee.gif]Audit Committee
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MEMBERS
Patrick O’Leary [MISSING IMAGE: tm2011277d2-icon_circlecpms.jpg] [MISSING IMAGE: tm2011277d2-icon_circlecbw.jpg]
Heidi Kunz [MISSING IMAGE: tm2011277d2-icon_circlecbw.jpg]
Julie Shimer
Meetings in 2020: 6
[MISSING IMAGE: tm2011277d2-icon_circlpms.jpg] ALL MEMBERS ARE INDEPENDENT
PRIMARY RESPONSIBILITIES
The Committee’s principal functions, as specified in its charter, include:

Overseeing:

the quality and integrity of our financial statements

our compliance programs in coordination with our Compliance Committee

our hedging strategies and policies

the independence, qualification, and performance of our independent auditors

the performance of our internal auditors

Selecting and engaging our independent auditors, subject to stockholder ratification

Pre-approving all audit and non-audit services that our independent auditor provides

Reviewing the scope of audits and audit findings, including any comments or recommendations of our independent auditors

Establishing policies for our internal audit programs

Overseeing our risk management program and receiving periodic reports from management on risk assessments, the risk management process, and issues related to the risks of managing our business

The Board has determined that two of the three Audit Committee members are “audit committee financial experts” under SEC rules and regulations, satisfy the NYSE’s financial literacy requirements, and qualify as independent directors under our Corporate Governance Policies.

No member of the Audit Committee serves on the Audit Committee of more than three public companies. Under our Audit Committee charter and NYSE corporate governance listing standards, if a member were to serve on more than three such committees, the Board would then determine whether this situation impairs the member’s ability to serve effectively on our Audit Committee, and we would post information about this determination on the Investors section of our website at www.avanos.com.
AUDIT COMMITTEE REPORT

For additional information about the Audit Committee’s oversight activities with respect to our 2020 financial statements, see “Proposal 2, Ratification of Auditors — Audit Committee Report.”
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2021 Notice and Proxy Statement15

CORPORATE GOVERNANCE
[MISSING IMAGE: ico_compensationcommittee.gif]Compensation Committee
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MEMBERS
William Hawkins [MISSING IMAGE: tm2011277d2-icon_circlecpms.jpg]
Heidi Kunz
Patrick O’Leary
Meetings in 2020: 6
[MISSING IMAGE: tm2011277d2-icon_circlpms.jpg] ALL MEMBERS ARE INDEPENDENT
PRIMARY RESPONSIBILITIES
The Committee’s principal functions, as specified in its charter, include:

Establishing and administering the policies governing annual compensation and long-term compensation, including stock option awards, restricted stock awards, and restricted share unit awards, such that the policies are designed to align compensation with our overall business strategy and performance

Setting, after an evaluation of his overall performance, the compensation level of the CEO

Determining, in consultation with the CEO, compensation levels and performance targets for our executive officers

Setting annual targets and certifying awards for corporate performance under our corporate incentive compensation plans

Advising the Board on outside director compensation

Overseeing:

leadership development for senior management and future senior management candidates

a periodic review of our long-term and emergency succession planning for the CEO and other key officer positions, in conjunction with our Board

key organizational effectiveness and engagement policies

Annually reviewing our compensation policies and practices for the purpose of mitigating risks arising from these policies and practices that could reasonably have a material adverse effect on the Company
ROLES OF THE COMMITTEE AND CEO IN
COMPENSATION DECISIONS
Each year, the Committee reviews and approves the compensation of our named executive officers, including our CEO, and certain other officers (collectively, “Covered Officers”). The Committee’s charter does not permit the Committee to delegate to anyone the authority to establish any compensation policies or programs for the executive officers. With respect to officers other than the Covered Officers, our CEO has the authority to establish compensation programs and, subject to certain limits, to approve equity grants. However, only the Committee may make equity grants to our executive officers.
Our CEO makes a recommendation to the Committee each year on the appropriate target
annual compensation for each of the Covered Officers. The Committee makes the final determination of the target annual compensation for each Covered Officer. While our CEO typically attends Committee meetings, none of the other executive officers is present during the portion of the Committee meetings when compensation for them is set. In addition, our CEO is not present during the portion of the Committee meetings when his compensation is set.
For additional information on the Committee’s processes and procedures for determining executive compensation, and for a detailed discussion of our compensation policies, see “Compensation Discussion and Analysis.”
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162021 Notice and Proxy Statement

CORPORATE GOVERNANCE​
USE OF COMPENSATION CONSULTANTS
The Committee’s charter authorizes the Committee to retain advisors, including compensation consultants, to assist it in its work. The Committee believes that compensation consultants can provide important market information and perspectives that can help it determine compensation programs that best meet the objectives of our compensation policies. In selecting a consultant, the Committee evaluates the independence of the firm as a whole and of the individual advisors who will be working with the Committee.
The Committee retains an independent compensation consultant who, according to the Committee’s written policy, provides services solely to the Committee and not to the Company. The Committee’s consultant has no other business relationship with the Company and receives no payments from the Company other than fees for services to the Committee. The consultant reports directly to the Committee, and the Committee may replace the consultant or hire additional
consultants at any time. The Committee has selected Meridian Compensation Partners, LLC (“Meridian”) as its independent consultant.
In 2020, the scope of activities for the Committee’s independent compensation consultant included:

Conducting a review of the executive compensation peer group

Benchmarking the compensation of the Covered Officers

Reviewing and commenting on the Company’s executive compensation programs

Conducting a risk assessment of the Company’s executive compensation programs

Attending Committee meetings

Periodically consulting with the Chairman of the Committee
COMMITTEE ASSESSMENT OF CONSULTANT CONFLICTS OF INTEREST
The Committee has reviewed whether the work provided by Meridian raises any conflict of interest. Factors considered by the Committee include:
1
whether other services are provided to the Company by the consultant;
2
what percentage of the consultant’s total revenue is made up of fees from the Company;
3
policies or procedures of the consultant that are designed to prevent a conflict of interest;
4
any business or personal relationships between individual consultants involved in the engagement and Committee members;
5
any shares of the Company stock owned by individual consultants involved in the engagement; and
6
any business or personal relationships between our executive officers and the consulting firm or the individual consultants involved in the engagement.
Based on its review, the Committee does not believe that the compensation consultants that performed services to the Committee in 2020 have a conflict of interest with respect to the work performed for the Committee.
COMMITTEE REPORT
The Committee has reviewed the “Compensation Discussion and Analysis” section of this proxy statement and has recommended that it be included in this proxy statement. The Committee’s
report is located at “Compensation Discussion and Analysis — Compensation Committee Report.”
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2021 Notice and Proxy Statement17

CORPORATE GOVERNANCE
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The members of the Compensation Committee during 2020 were Ms. Kunz and Messrs. Hawkins and O’Leary. None of the members of the Compensation Committee was, during 2020, a current or former officer or employee of the Company. Also, none of the members of the Compensation Committee had any relationship with the Company in 2020 requiring disclosure under Item 404 of Regulation S-K. For information
about the Company’s policies on transactions with related parties, see “Transactions with Related Parties” later in this proxy statement. During 2020, none of our executive officers served as a member of the board of directors or compensation committee of any entity that had one or more executive officers serving as a member of our Board of Directors or Compensation Committee.
[MISSING IMAGE: tm218127d1-icon_lockpms.gif]Compliance Committee
[MISSING IMAGE: ph_byrnes-bwlr.jpg]
MEMBERS
John Byrnes [MISSING IMAGE: tm2011277d2-icon_circlecpms.jpg]
William Hawkins
Maria Sainz
Meetings in 2020: 5
[MISSING IMAGE: tm2011277d2-icon_circlpms.jpg] ALL MEMBERS ARE INDEPENDENT
PRIMARY RESPONSIBILITIES
The Committee’s principal functions, as specified in its charter, include the following:

Overseeing the Company’s compliance program in the areas of:

Code of Conduct

Conflicts of interest

Consumer Protection

Customs and Export Controls

Environment

Ethics

False Claims

Foreign Corrupt Practices Act and Similar Anti-Bribery Laws

Fraud and Abuse Laws including Anti-Kickback

Government Reimbursement Programs, including Medicare

Government Relations

Health and Safety

Interactions with Healthcare Professionals

Information Systems Security

Intellectual Property

International Distributors

Labor & Employment

Physical Security

Public Policy

Quality

Recalls

Regulatory, including FDA

Safety

Sales of Products or Services to US or Foreign Governments, including entities owned by such governments

Sunshine Act and Other Laws Relating to Reporting of and Transparency with Respect to Payments to Healthcare Professionals

Transportation

Overseeing the Company’s sustainability, corporate social responsibility, and corporate citizenship matters

Monitoring the Company’s efforts to implement programs, policies, and procedures relating to compliance matters

Overseeing the investigation of any significant instances of non-compliance with laws or the Company’s compliance program, policies, or procedures, other than any instances involving financial non-compliance

Reviewing the Company’s compliance risk assessment plan

Identifying and investigating emerging compliance issues and trends which may affect the Company
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182021 Notice and Proxy Statement

CORPORATE GOVERNANCE​
[MISSING IMAGE: tm218127d1-icon_govcommpms.gif]Governance Committee
[MISSING IMAGE: ph_julieshimer-k.jpg]
MEMBERS
Julie Shimer [MISSING IMAGE: tm2011277d2-icon_circlecpms.jpg]
John Byrnes
Maria Sainz
   
Meetings in 2020: 5
[MISSING IMAGE: tm2011277d2-icon_circlpms.jpg] ALL MEMBERS ARE INDEPENDENT
PRIMARY RESPONSIBILITIES
The Committee’s principal functions, as specified in its charter, include:

Overseeing the screening and recruitment of prospective Board members and making recommendations to the Board of Directors regarding specific director nominees, as well as overseeing the process for Board nominations

Overseeing corporate governance matters, including developing and recommending to the Board changes to our Corporate Governance Policies

Advising the Board on:

Board organization, membership, function, and performance

committee structure and membership

Reviewing director independence standards and making recommendations to the Board with respect to the determination of director independence

Monitoring and recommending improvements to the Board’s practices and procedures

Reviewing stockholder proposals and considering how to respond to them
The Committee, in accordance with its charter and our Certificate of Incorporation, has established criteria and processes for director nominations, including those proposed by stockholders. Those criteria and processes are described in “Proposal 1. Election of Directors — Process and Criteria for Nominating Directors” and “Other Information — Stockholder Nominations for Board of Directors.”
[MISSING IMAGE: tm218127d1-icon_execommpms.gif]Executive Committee
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MEMBERS
Gary Blackford,  [MISSING IMAGE: tm2011277d2-icon_circlecpms.jpg]
Chairman of the Board
John Byrnes
William Hawkins
Patrick O’Leary
Joseph Woody
Meetings in 2020: 0
[MISSING IMAGE: tm2011277d2-icon_circlpms.jpg] ALL MEMBERS ARE INDEPENDENT OTHER THAN MR. WOODY
PRIMARY RESPONSIBILITIES
The Committee's principal function is to exercise, when necessary between Board meetings, the Board's powers to direct our business and affairs. Accordingly, the
Committee has no regularly scheduled meetings and it is expected that, each year, the Committee will meet infrequently or not at all.
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2021 Notice and Proxy Statement19

CORPORATE GOVERNANCE
Communicating with Directors
The Board has established processes by which stockholders and other interested parties may communicate with the Board, as well as with the
Audit Committee and Compliance Committee. Those processes can be found in the Investors section of our website at www.avanos.com.
Other Corporate Governance Policies and Practices
CORPORATE GOVERNANCE POLICIES
The Board has adopted Corporate Governance Policies. These policies guide the Company and the Board on matters of corporate governance, including:

director responsibilities

Board committees and their charters

director independence

director compensation and performance assessments

director orientation and education

director access to management

Board access to outside financial, business, and legal advisors, and

management development and succession planning.
To see these policies, go to the Investors section of our website at www.avanos.com.
CODE OF CONDUCT
The Company has a Code of Conduct that applies to all of our directors, executive officers and employees, including our CEO, Chief Financial Officer, and Controller. It is available in the Investors section of our website at
www.avanos.com. Any amendments to or waivers of our Code of Conduct applicable to our CEO, Chief Financial Officer, or Controller will also be posted at that location.
BOARD AND MANAGEMENT ROLES IN RISK OVERSIGHT
The Board is responsible for providing risk oversight with respect to our operations. In connection with this oversight, the Board particularly focuses on our strategic and operational risks, as well as related risk mitigation.
In addition, the Board reviews and oversees management’s response to key risks facing the Company. The Board’s committees review particular risk areas to assist the Board in its overall risk oversight of the Company.
COMMITTEES
AUDIT
COMPENSATION
COMPLIANCE
GOVERNANCE
The Audit Committee monitors risks relating to such matters as our:

internal controls,

financial statement integrity and fraud risks, and

related risk mitigation.
In connection with this oversight, the Audit Committee receives regular reports from management on:

risk assessments,

the risk management process, and

issues related to the risks of managing our business.
The Compensation Committee reviews the risk profile of our compensation policies and practices. This process includes an assessment of our compensation programs, as described in “Compensation Discussion and Analysis — Analysis of Compensation-Related Risks.”
The Compliance Committee monitors risks relating to certain compliance matters, such as those described in the section “Compliance Committee,” and recommends appropriate actions in response to those risks.
The Governance Committee monitors risks relating to governance matters and recommends appropriate actions in response to those risks.
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202021 Notice and Proxy Statement

CORPORATE GOVERNANCE​
Complementing the Board’s overall risk oversight, our senior executive team identifies and monitors key enterprise-wide and business unit risks, providing the basis for the Board’s risk review and oversight process. Our senior management team is supported by management members from business units and from our finance, treasury, information technology, global risk management, compliance, internal audit, and legal functions. Management identifies significant risks for review and updates our policies for risk management in
areas such as hedging, foreign currency, and country risks, product liability, property and casualty risks, and supplier and customer risks. The Board believes the allocation of risk management responsibilities described above supplements the Board’s leadership structure by allocating risk areas to an appropriate committee for oversight, allows for an orderly escalation of issues as necessary, and helps the Board satisfy its risk oversight responsibilities.
WHISTLEBLOWER PROCEDURES
The Audit Committee has established procedures for receiving, recording and addressing any complaints we receive regarding accounting, internal accounting controls, or auditing matters, and for the confidential and anonymous submission, by our employees or others, of any concerns about our accounting or auditing practices. The Compliance Committee has adopted similar procedures for receiving, recording, and
addressing any complaints we receive regarding compliance matters other than those addressed by the Audit Committee. The Audit Committee’s and Compliance Committee’s procedures are available in the Investors section of our website at www.avanos.com. We also maintain a toll-free Code of Conduct telephone line and a website, each allowing our employees and others to voice their concerns anonymously.
MANAGEMENT SUCCESSION PLANNING
In conjunction with the Board, the Compensation Committee is responsible for periodically reviewing the long-term management development plans and succession plans for the CEO and other key
officers, as well as the emergency succession plan for the CEO and other key officers if any of these officers unexpectedly becomes unable to perform his or her duties.
DISCLOSURE COMMITTEE
We have established a Disclosure Committee to assist in fulfilling our obligations to maintain disclosure controls and procedures and to coordinate and oversee the process of preparing
our periodic securities filings with the SEC. This committee is composed of members of management and is chaired by our Controller.
NO EXECUTIVE LOANS
We do not extend loans to our executive officers or directors and therefore do not have any such loans outstanding.
CHARITABLE CONTRIBUTIONS
The Governance Committee has adopted guidelines for the review and approval of charitable contributions by the Company to organizations or entities with which a director or an executive officer may be affiliated. We will disclose in the Investors section of our website at www.avanos.com any contributions made by us to a tax-exempt organization under the following circumstances:

An independent director serves as an executive officer of the tax-exempt organization; and

If within the preceding three years, contributions in any single year from the Company to the organization exceeded the greater of  $1 million or 2 percent of the tax-exempt organization’s consolidated gross revenues.
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2021 Notice and Proxy Statement21

PROPOSAL 1.
ELECTION OF DIRECTORS
At the 2020 Annual Meeting, stockholders voted to approve adoption of amendments to our Amended and Restated Certificate of Incorporation (“Certificate of Incorporation”) to declassify our Board of Directors (“Declassification Amendment”). We have since amended and restated our Certificate of Incorporation and our bylaws accordingly.
By declassifying the Board, our stockholders can vote on the election of our entire Board of Directors each year, rather than on a staggered basis, as was previously the case under our classified board structure. To comply with Delaware law, however,
the Declassification Amendment could not change the unexpired three-year terms of directors elected prior to the effectiveness of the Declassification Amendment, including directors elected at the 2020 Annual Meeting.
Accordingly, the three-year term for directors elected in 2018, 2019, and 2020 will expire at the 2021, 2022 and 2023 Annual Meetings, respectively. The following table summarizes the implementation of the declassification of our Board pursuant to the Declassification Amendment.
Annual Meeting Year
Number of Directors Elected
Length of Term
(Expiration Date)
2020
Two
Three years (2023)
2021
Two
One year (2022)
2022
Five
One Year (2023)
2023
(and thereafter)
Full Board
One Year
(next annual meeting)
Three directors, Gary Blackford, William Hawkins and Patrick O’Leary, have terms that expire at this Annual Meeting. Mr. Hawkins, though, has notified us that he will not stand for re-election. The two other directors, Messrs. Blackford and O’Leary, have been nominated to serve for a term until the 2022 Annual Meeting and until their successors have been duly elected and qualified.
Messrs. Blackford and O’Leary have advised us that they will serve if elected; however, should either nominee become unable to serve, the Board may reduce the number of directors to be elected
or select a substitute nominee. If the Board selects a substitute nominee, the shares represented by valid proxies will be voted for the substitute nominee, other than shares voted “Withhold” with respect to the original nominee.
In light of Mr. Hawkins notification to us that he will not stand for re-election, the Board decided to reduce the size of the Board from eight directors to seven, effective as of the Annual Meeting on April 29, and not to fill the vacancy that will be created by Mr. Hawkins’ decision.
Process and Criteria for Nominating Directors
The Board is responsible for approving candidates for Board membership. The Board has delegated the screening and recruitment process to the Governance Committee, in consultation with the Chairman and CEO. The Committee therefore recommends to the Board any new director appointments and nominees for election as directors at our annual meeting of stockholders. It also recommends nominees to fill any vacancies. As provided in our Certificate of Incorporation, the Board may elect a new director when a vacancy occurs between annual meetings of stockholders.
The Committee may receive recommendations for Board candidates from various sources, including our directors, management, and stockholders. Stockholders may submit recommendations for Board candidates to:
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Avanos Medical, Inc.
Attn: Corporate Secretary
5405 Windward Parkway
Suite 100 South
Alpharetta, GA 30004
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222021 Notice and Proxy Statement

PROPOSAL 1. ELECTION OF DIRECTORS​
Board candidates recommended by stockholders are evaluated using the same criteria as candidates recommended by other sources. In addition, the Governance Committee may periodically retain a search firm to assist it in identifying and recruiting director candidates meeting the criteria specified by the Committee.
The Committee believes that the criteria for director nominees should foster effective corporate governance, support our strategies and
businesses, take diversity into account, and ensure that our directors, as a group, have an overall mix of the attributes needed for an effective Board. The criteria should also support the successful recruitment of qualified candidates.
Qualified candidates for director are those who, in the judgment of the Committee, possess all of the personal attributes and a sufficient mix of the experience attributes listed below to ensure effective service on the Board.
PERSONAL ATTRIBUTES
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LEADERSHIP
Lead in personal and professional lives.
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INDEPENDENCE
Independent of management and Company (for non-management directors only).
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ETHICAL CHARACTER
Possess high standards for ethical behavior.
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ABILITY TO COMMUNICATE
Possess good interpersonal skills.
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COLLABORATIVE
Actively participate in Board and committee matters.
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EFFECTIVENESS
Bring a proactive and solution-oriented approach.
EXPERIENCE ATTRIBUTES
Attribute
Factors That May Be Considered
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FINANCIAL ACUMEN

satisfies the financial literacy requirements of the NYSE

qualifies as an audit committee financial expert under the rules and regulations of the SEC

has an accounting, finance or banking background
Has good knowledge of business finance and financial statements.
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GENERAL BUSINESS EXPERIENCE

has leadership experience as a chief or senior executive officer

has experience setting compensation
Possesses experience that will aid in judgments concerning business issues.
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INDUSTRY KNOWLEDGE

has substantial knowledge of the healthcare industry, including with respect to caregiving, cost reimbursement or regulatory environment

has governance/public company board experience
Possesses knowledge about our business.
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2021 Notice and Proxy Statement23

PROPOSAL 1. ELECTION OF DIRECTORS
EXPERIENCE ATTRIBUTES
Attribute
Factors That May Be Considered
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DIVERSITY OF BACKGROUND AND EXPERIENCE

brings a diverse background that is representative of our customer, patient, employee and stockholder base, including with respect to gender, race, ethnic or national origin, and age

reflects a different experience stemming, for example, from a different academic background or from experiences outside the healthcare industry
Brings to the Board an appropriate level of diversity.
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SPECIAL BUSINESS EXPERIENCE

has international experience

has a track record of successful innovation

has supply chain management expertise

has cybersecurity expertise
Possesses global management experience with medical devices.
Committee Review of Attributes of Current Directors
The Governance Committee has reviewed the background of each of our current directors and their service on the Board in light of the personal and experience attributes described above. The Committee has determined that each director possesses all of the personal attributes as well as a sufficient mix of the experience attributes.
For details about each director’s specific experience attributes, see “The Nominees” and “Directors Continuing in Office” below.
Diversity of Directors
As noted above, the Governance Committee believes that diversity of backgrounds and experience is a key attribute for directors. As a result, the Committee seeks to have a diverse Board that is representative of our customer, patient, employee, and stockholder base,
including with respect to gender, race, ethnic or national origin, and age. While the Committee carefully considers diversity when considering nominees for director, the Committee has not established a formal policy regarding diversity in identifying director nominees.
The Nominees
The following two individuals are nominated for election to the Board for a one-year term expiring at the 2022 Annual Meeting of Stockholders:
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242021 Notice and Proxy Statement

PROPOSAL 1. ELECTION OF DIRECTORS​
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FORMER CHAIRMAN AND CEO, UNIVERSAL HOSPITAL SERVICES
COMMITTEE
• Executive
GARY D. BLACKFORD
Age 63 | [MISSING IMAGE: ico_circledtick-136u.jpg] Independent | Director since October 2014; Chairman since April 2020
CAREER HIGHLIGHTS
Universal Hospital Services, a leading, nationwide provider of medical technology outsourcing and services to the health care industry

Chairman of the Board and Chief Executive Officer (2002 to February 2015)
Curative Health Services, Inc., a specialty pharmacy and health services company

Chief Executive Officer (2001 to 2002)
ShopforSchool, Inc., an online retailer

Chief Executive Officer (1999 to 2001)
OTHER CURRENT PUBLIC COMPANY BOARDS

ReShape Lifesciences, Inc. (RSLS) (Director since 2016, and Lead Director since 2019)
OTHER CURRENT DIRECTORSHIPS

Children’s Hospitals and Clinics of Minnesota (since 2017, and Chairman since 2020)

Advanced Tissue, Inc.
PRIOR PUBLIC COMPANY BOARDS

Wright Medical Group N.V. (Director from 2008 to 2020)
OTHER PRIOR DIRECTORSHIPS

PipelineRX, Inc. (Director from 2016 to 2020)
KEY SKILLS AND QUALIFICATIONS
Mr. Blackford has been selected to serve as a member of our Board of Directors due to his:

executive leadership experience as a chief executive officer

financial literacy and experience in finance and accounting

knowledge of, and experience in, the healthcare industry

international experience, and

governance and public company board experience.
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FORMER EXECUTIVE VICE PRESIDENT AND CFO, SPX CORPORATION
COMMITTEES
• Audit (Chair)
• Compensation
PATRICK J. O’LEARY
Age 63 | [MISSING IMAGE: ico_circledtick-136u.jpg] Independent | Director since October 2014
CAREER HIGHLIGHTS
SPX Corporation, a global industrial and technological services and products company

Executive Vice President and Chief Financial Officer (December 2004 to August 2012)

Chief Financial Officer and Treasurer (October 1996 to December 2004)
OTHER CURRENT PUBLIC COMPANY BOARDS

SPX Corporation (NYSE: SPXC) (Director and Chairman since 2015)
PRIOR PUBLIC COMPANY BOARDS

PulteGroup (NYSE: PHM) (2005 to 2018)
KEY SKILLS AND QUALIFICATIONS
Mr. O’Leary has been selected to serve as a member of our Board of Directors due to his:

executive leadership experience as a chief financial officer

financial literacy and experience in finance and accounting

international experience, and

governance and public company board experience.
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The Board of Directors unanimously recommends a vote FOR the election of each of the two nominees for director named above.
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2021 Notice and Proxy Statement25

PROPOSAL 1. ELECTION OF DIRECTORS
Directors Continuing in Office
The following members of the Board of Directors are continuing in office and have terms expiring as indicated below:
DIRECTORS FOR TERM EXPIRING IN 2022
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FORMER CHAIRMAN AND CEO, LINCARE HOLDINGS, INC.
COMMITTEES
• Compliance
   (Chair)
• Governance
JOHN P. BYRNES
Age 62 | [MISSING IMAGE: ico_circledtick-136u.jpg]  Independent | Director since October 2014
CAREER HIGHLIGHTS
Lincare Holdings, a provider of home respiratory care, infusion therapy and medical equipment

Chairman of the Board (March 2000 to March 2015)

Chief Executive Officer (1997 to March 2015)

President (June 1996 to December 1996)

Chief Operating Officer (January 1996 to December 1996)

Various executive leadership positions (1986 to 1996)
PRIOR PUBLIC COMPANY BOARDS

Tenet Healthcare Corporation (November 2016 to May 2018)

Lincare Holdings (Chairman of the Board, March 2000 to March 2015; director from May 1997 to August 2015)
OTHER PRIOR DIRECTORSHIPS

U.S. Renal Care, Inc. (August 2005 to 2012)

Kinetic Concepts, Inc. (January 2003 to February 2011)
KEY SKILLS AND QUALIFICATIONS
Mr. Byrnes has been selected to serve as a member of our Board of Directors due to his:

executive leadership experience as a chief executive officer

knowledge of, and experience in, the healthcare industry

international experience, and

governance and public company board experience.
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262021 Notice and Proxy Statement

PROPOSAL 1. ELECTION OF DIRECTORS​
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FORMER CEO, AEGEA MEDICAL
COMMITTEES
• Compliance
• Governance
MARIA SAINZ
Age 55 | [MISSING IMAGE: ico_circledtick-136u.jpg]  Independent | Director since February 2015
CAREER HIGHLIGHTS
Aegea Medical, a medical device company in the womens’ health space focused on the development of technology for endometrial ablation

Chief Executive Officer (May 2018 to February 2021)
Cardiokinetix, a medical device company

President and Chief Executive Officer (May 2012 to July 2017)
Stryker Corporation (acquired Concentric Medical in 2011)

General Manager, Stryker Neurovascular
Concentric Medical, a medical technology company

President and Chief Executive Officer (April 2008 to May 2012)
Boston Scientific (acquired Guidant Corporation in 2006)

Head of Integration (2006 to 2008)
Guidant Corporation

President, Cardiac Surgery division (February 2003 to July 2006)

Vice President, Global Marketing, Vascular Intervention (January 2001 to February 2003)

Vice President, Intermedics Cardiac Rhythm Management, Europe (1998 to 2001)
OTHER CURRENT PUBLIC COMPANY BOARDS

Orthofix Medical, Inc.

ShockWave Medical, Inc.
PRIOR PUBLIC COMPANY BOARDS

Iridex Corporation

Spectranetics Corporation
OTHER CURRENT DIRECTORSHIPS

Artio Medical, Inc.

Levita Magnetics International Corp.
KEY SKILLS AND QUALIFICATIONS
Ms. Sainz has been selected to serve as a member of our Board of Directors due to her:

executive leadership experience as a chief executive officer

knowledge of, and experience in, the healthcare industry

international experience, and

governance and public company board experience.
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2021 Notice and Proxy Statement27

PROPOSAL 1. ELECTION OF DIRECTORS
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FORMER CEO, WELCH ALLYN, INC.
COMMITTEES:
• Audit
• 
Governance (Chair)
DR. JULIE SHIMER
Age 68 | [MISSING IMAGE: ico_circledtick-136u.jpg]  Independent | Director since February 2015
CAREER HIGHLIGHTS
Dr. Shimer is currently a private investor and has 30 years of product development experience, including many years with major telecommunications companies.
Welch Allyn, Inc., a manufacturer of frontline medical products and solutions

Chief Executive Officer and Director (March 2007 to April 2012)
Vocera Communications, Inc. a provider of wireless communications systems

President, Chief Executive Officer and Director
3Com Corporation

General Manager
Motorola

General Manager and Product Development Leader
AT&T Bell Laboratories

Product Development Leader
OTHER CURRENT PUBLIC COMPANY BOARDS

Apollo Endosurgery, Inc.

Masimo Corporation
OTHER CURRENT DIRECTORSHIPS

Advisor to Kitchology, a mobile platform empowering families dealing with special diets through the power of technology and community

Advisor to CPLANE Networks, a leader in end-to-end data center and wide area network service orchestration that enables software-defined networking (SDN) and network function virtualization (NFV) services to be launched and managed in a single environment
PRIOR PUBLIC COMPANY BOARDS

NetGear, Inc. a provider of home and small business network solutions

Windstream Holdings, Inc., a leading telecommunications and cloud services provider

Earthlink, Inc., an internet service provider
OTHER PRIOR DIRECTORSHIPS

Welch Allyn, Inc. (July 2002 to April 2012)

Vocera Communications, Inc.
KEY SKILLS AND QUALIFICATIONS
Dr. Shimer has been selected to serve as a member of our Board of Directors due to her:

executive leadership experience as a chief executive officer

knowledge of, and experience in, the healthcare industry

international experience, and

governance and public company board experience.
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282021 Notice and Proxy Statement

PROPOSAL 1. ELECTION OF DIRECTORS​
DIRECTORS FOR TERM EXPIRING IN 2023
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CEO, AVANOS
MEDICAL, INC.
COMMITTEES:
•Executive
JOSEPH F. WOODY
Age 55 | Director since June 2017
CAREER HIGHLIGHTS
Mr. Woody has more than 20 years of experience in the healthcare sector.
Avanos Medical, Inc.

Chief Executive Officer (June 26, 2017 to present)
Acelity Holdings, Inc., a global advanced wound care and regenerative medicine company

Director, President and Chief Executive Officer (August 2015 to April 2017)
Kinetic Concepts, Inc., LifeCell Corporation and Systagenix Wound Management B.V., the combined organization that became Acelity

President and Chief Executive Officer of the combined organization (September 2013 to August 2015)

Interim Chief Executive Officer, LifeCell (April 2013 to September 2013)

President and Chief Executive Officer, KCI (January 2012 to September 2013)

Various leadership roles, KCI and LifeCell (November 2011 to January 2012)
Covidien plc

Global President, Vascular Therapies
Smith & Nephew Advanced Wound Management

Global President
Alliance Imaging, Inc.

Vice President, Sales
Acuson

Executive leadership positions
GE Medical Systems

Executive Leadership Positions
OTHER CURRENT DIRECTORSHIPS

AdvaMed, Inc.
KEY SKILLS AND QUALIFICATIONS
Mr. Woody has been selected to serve as a member of our Board of Directors due to his:

leadership experience as our CEO,

knowledge of, and experience in, the healthcare industry, including significant acquisition and integration experience,

international experience, and

company board experience.
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FORMER
EXECUTIVE VICE
PRESIDENT AND
CFO, BLUE SHIELD
OF CALIFORNIA
COMMITTEES:
• Audit
• Compensation
HEIDI KUNZ
Age 66 | [MISSING IMAGE: ico_circledtick-136u.jpg] Independent | Director since February 2015
CAREER HIGHLIGHTS
Blue Shield of California, a not-for-profit health plan provider

Executive Vice President and Chief Financial Officer (2003 to 2012)
Gap, Inc., a multinational clothing and accessories retailer

Executive Vice President and Chief Financial Officer (1999 to 2003)
OTHER CURRENT PUBLIC COMPANY BOARDS

Agilent Technologies, Inc.

Phathom Pharmaceuticals, Inc.
KEY SKILLS AND QUALIFICATIONS
Ms. Kunz has been selected to serve as a member of our Board of Directors due to her:

executive leadership experience as a chief financial officer

financial literacy and experience in finance and accounting

knowledge of, and experience in, the healthcare industry

international experience, and

governance and public company board experience.
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2021 Notice and Proxy Statement29

PROPOSAL 1. ELECTION OF DIRECTORS
Director Compensation
Directors who are not officers or employees of the Company or any of our subsidiaries, affiliates or equity companies are Outside Directors for compensation purposes and are compensated for their services under our Outside Directors’ Compensation Plan. All independent directors currently on our Board are Outside Directors and are compensated under this Plan.
Our objectives for Outside Director compensation are:

to attract qualified candidates for Board service;

to remain competitive with the median compensation paid to Outside Directors of comparable companies;

to keep pace with changes in practices in director compensation; and

to reinforce our practice of encouraging stock ownership by our directors.
Our Outside Director compensation was established based on the median non-management director compensation for our peers. A list of the 2020 peer group companies may be found in the “Compensation Discussion and Analysis” section of this proxy statement.
We structure Outside Director compensation as follows:
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BOARD MEMBERS

Cash retainer: $70,000 annually, paid in four quarterly payments at the beginning of each quarter.

Restricted share units: Annual grant with a value of  $180,000, awarded and valued on the first business day of the year.
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CHAIRMAN OF THE BOARD
Additional cash compensation of $115,000, paid in four quarterly payments at the beginning of each quarter.
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COMMITTEE CHAIRS

Additional cash compensation of $15,000, paid in four quarterly payments at the beginning of each quarter, except that (1) the Audit Committee chair receives additional cash compensation of  $20,000, paid in four quarterly installments at the beginning of each quarter, and (2) the Executive Committee chair does not receive any additional compensation for that role.
New Outside Directors receive a pro-rated annual retainer and grant of restricted share units based on the month when they join the Board.
We also reimburse Outside Directors for expenses incurred in attending Board or committee meetings.
Restricted share units are not shares of our common stock. Rather, restricted share units represent the right to receive a pre-determined number of shares of our common stock within 90 days following a “restricted period” that begins on the date of grant and expires on the date the Outside Director retires from or otherwise terminates service on the Board. In this way, they align the director’s interests with the interests of our stockholders. Outside Directors may not dispose of the units or use them in a pledge or similar transaction. Outside Directors also receive additional restricted share units equivalent in value to the dividends, if any, that would have been paid to them if the restricted share units granted to them were shares of our common stock. The Company does not currently pay dividends on its common stock.
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302021 Notice and Proxy Statement

PROPOSAL 1. ELECTION OF DIRECTORS​
2020 Outside Director Compensation
The following table shows the compensation paid to each Outside Director for his or her service in 2020:
Name
Fees Earned or Paid in Cash
($)
Stock Awards(1)(2)
($)
Total
($)
Gary Blackford 176,667 180,000 356,667
John Byrnes 83,750 180,000 263,750
William Hawkins, III 85,000 180,000 265,000
Heidi Kunz 71,667 180,000 251,667
Patrick O’Leary 88,333 180,000 268,333
Maria Sainz 70,000 180,000 250,000
Dr. Julie Shimer 85,000 180,000 265,000
(1)
Amounts shown reflect the grant date fair value of those grants, determined in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 718 — Stock Compensation (“ASC Topic 718”) for restricted share unit awards granted pursuant to our Outside Directors’ Compensation Plan. See Note 13 to our audited consolidated and combined financial statements included in our Annual Report on Form 10-K for 2020 for the assumptions used in valuing these restricted share units.
(2)
The Board has determined that outside director compensation for 2021 will be the same as in 2020. Accordingly, each director received an annual grant of 4,005 restricted share units on January 4, 2021.
Other than the cash retainer and grants of restricted share units previously described, no Outside Director received any compensation or perquisites from the Company for services as a director in 2020.
A director who is not an Outside Director does not receive any compensation for services as a member of the Board or any committee but is reimbursed for expenses incurred as a result of the services.
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2021 Notice and Proxy Statement31

PROPOSAL 2.
RATIFICATION OF AUDITORS
The Audit Committee of the Board of Directors is directly responsible for the appointment, compensation, retention, and oversight of our independent auditors. The Audit Committee is also responsible for overseeing the negotiation of the audit fees associated with retaining our independent auditors. To assure continuing auditor independence, the Audit Committee periodically considers whether a different audit firm should perform our independent audit work. Also, in connection with the mandated rotation of the independent auditor’s lead engagement partner, the Audit Committee and its Chair are directly involved in the selection of the lead engagement partner.
For 2021, the Audit Committee has selected Deloitte & Touche LLP (along with its member firms and affiliates, “Deloitte”) as the independent registered public accounting firm to audit our financial statements. In engaging Deloitte for 2021, the Audit Committee utilized a review and selection process that included the following:

a review of management’s assessment of the services Deloitte provided in 2020;

discussions, in executive session, with the Chief Financial Officer and Controller regarding their viewpoints on the selection of the 2021 independent auditors and on Deloitte’s performance;

discussions, in executive session, with representatives of Deloitte about their possible engagement;

Audit Committee discussions, in executive session, about the selection of the 2021 independent auditors;

a review and approval of Deloitte’s proposed estimated fees for 2021; and

a review and assessment of Deloitte’s independence.
The Audit Committee and the Board believe that the continued retention of Deloitte to serve as our independent auditor is in the best interests of the Company and its stockholders, and they recommend that stockholders ratify this selection.
Representatives of Deloitte are expected to attend the Annual Meeting with the opportunity to make a statement if they desire to do so and will be available to respond to appropriate questions.
Stockholders are not required to ratify the appointment of Deloitte as our independent auditor. However, we are submitting the ratification to our stockholders as a matter of good corporate practice. If our stockholders fail to ratify the appointment of Deloitte, or even if our stockholders do ratify the appointment of Deloitte, the Audit Committee in its discretion may select a different independent auditor at any time during the year if it determines that such change would be in the best interest of the Company and our stockholders.
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The Board of Directors unanimously recommends a vote FOR ratification of the selection of Deloitte as the Company’s auditor for 2021.
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322021 Notice and Proxy Statement

PROPOSAL 2. RATIFICATION OF AUDITORS​
Accounting Firm Fees
Our aggregate fees to Deloitte (excluding value added taxes) with respect to the fiscal years ended December 31, 2020 and 2019, were as follows:
2020 ($)
2019 ($)
Audit Fees (1) 2,257,162 4,172,500
Tax Fees (2) 911,200 300,000
(1)
These amounts represent fees billed or expected to be billed for professional services rendered by Deloitte for the audit of the Company’s annual financial statements for the fiscal years ended December 31, 2020 and December 31, 2019, reviews of the financial statements included in the Company’s Form 10-Qs, and other services that are normally provided by the independent registered public accounting firm in connection with statutory or regulatory filings or engagements for each of those fiscal years, including: fees for consolidated financial audits, statutory audits, comfort letters, attest services, consents, assistance with and review of SEC filings and other related matters.
(2)
These amounts represent Deloitte’s aggregate fees for tax compliance, tax advice and tax planning for 2020 and 2019.
Audit Committee Approval of Audit and Non-Audit Services
Using the following procedures, the Audit Committee pre-approves all audit and non-audit services provided by Deloitte to the Company:

Before the first in-person or virtual Audit Committee meeting of the year, our Controller prepares a detailed memorandum regarding non-audit services to be provided by Deloitte during the year. This memorandum includes the services to be provided, the estimated cost of these services, reasons why it is appropriate to have Deloitte provide these services, and reasons why the requested services are not inconsistent with applicable auditor independence rules;

At the first in-person or virtual Audit Committee meeting each year, our Controller presents a proposal, including fees, to engage Deloitte for audit and non-audit services; and

Before each subsequent meeting of the Audit Committee, our Controller prepares an additional memorandum that includes
updated information regarding the approved services and highlights any new audit and non-audit services to be provided by Deloitte. All new non-audit services to be provided are described in individual requests for services.
The Audit Committee reviews the requests presented in these proposals and memoranda and approves all services it finds acceptable.
To ensure prompt handling of unexpected matters, the Audit Committee has delegated to the Chair of the Audit Committee the authority to amend or modify the list of audit and non-audit services and fees between meetings, as long as the additional or amended services do not affect Deloitte’s independence under applicable rules. Any actions taken under this authority are reported to the Audit Committee at its next meeting.
All Deloitte services and fees in 2020 were pre-approved by the Audit Committee or the Audit Committee Chair.
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2021 Notice and Proxy Statement33

PROPOSAL 2. RATIFICATION OF AUDITORS
Audit Committee Report
In accordance with its charter adopted by the Board, the Audit Committee assists the Board in overseeing the quality and integrity of the Company’s accounting, auditing, and financial reporting practices.
In discharging its oversight responsibility for the audit process, the Audit Committee obtained from the independent registered public accounting firm (the “auditors”) a formal written statement describing all relationships between the auditors and the Company that might bear on the auditors’ independence, as required by Public Company Accounting Oversight Board (“PCAOB”) Rule 3526, “Communication with Audit Committees Concerning Independence,” discussed with the auditors any relationships that may impact their objectivity and independence, and satisfied itself as to the auditors’ independence. The Audit Committee also discussed with management, the internal auditors, and the auditors, the quality and adequacy of the Company’s internal controls and the internal audit function’s organization, responsibilities, budget, and staffing. The Audit Committee reviewed with both the auditors and the internal auditors their audit plans, audit scope, and identification of audit risks.
The Audit Committee discussed and reviewed with the auditors all communications required by the PCAOB’s auditing standards, including those required by PCAOB AS 16, “Communication with Audit Committees.” Also, with and without management present, it discussed and reviewed the results of the auditors’ examination of our financial statements.
Management is responsible for preparing the Company’s financial statements in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and for establishing and maintaining the Company’s internal control over financial reporting. The auditors have the responsibility for performing an independent audit of the Company’s financial statements and for expressing opinions on the conformity of the Company’s financial statements with GAAP. The Audit Committee discussed and reviewed the Company’s audited financial statements as of and for the fiscal year ending December 31, 2020, with management and the auditors.
Based on the above-mentioned review and discussions with management and the auditors, the Audit Committee recommended to the Board that the Company’s audited financial statements be included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2020, for filing with the SEC. The Audit Committee also has selected and recommended to the Company’s stockholders for ratification the reappointment of Deloitte as the independent registered public accounting firm for 2021.
AUDIT COMMITTEE OF THE BOARD OF DIRECTORS
Patrick O’Leary, Chair
Heidi Kunz
Julie Shimer
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342021 Notice and Proxy Statement

PROPOSAL 3.
ADVISORY VOTE TO APPROVE NAMED EXECUTIVE OFFICER COMPENSATION
In the Compensation Discussion and Analysis that follows, we describe in detail our executive compensation program, including its objectives, policies, and components. Our executive compensation program seeks to align the compensation of our executives with the
objectives of our business plans and strategies. To this end, the Compensation Committee (the “Committee”) approved an executive compensation program for 2020 that was designed to achieve the following objectives:
I.
PAY FOR
PERFORMANCE

Support a performance-oriented environment that rewards achievement of our financial and non-financial goals
II.
FOCUS ON LONG-
TERM SUCCESS

Reward executives for long-term strategic management and stockholder value enhancement
III.
STOCKHOLDER
ALIGNMMENT

Align the financial interest of our executives with those of our stockholders

IV.
QUALITY OF
TALENT

Attract and retain executives whose abilities are considered essential to our long-term success
For a more detailed discussion of how our executive compensation program reflects these objectives, including information about the 2020 compensation of our named executive officers, see “Compensation Discussion and Analysis,” below.
We are asking our stockholders to support our executive compensation as described in this proxy statement. This proposal, commonly known as a “say-on-pay” proposal, gives our stockholders the opportunity to express their views on our executive compensation. This vote is not intended to address any specific item of compensation, but rather the overall compensation of our executives and the objectives, policies, and practices described in this proxy statement. Accordingly, our stockholders are being asked to vote on the following non-binding resolution at the Annual Meeting:
RESOLVED, that the compensation paid to the Company’s named executive officers, as disclosed pursuant to Item 402 of Regulation S-K, including the Compensation Discussion and Analysis, compensation tables, and narrative discussion, is hereby approved by the Company’s stockholders on an advisory basis.
The say-on-pay vote is advisory and is therefore not binding on the Company, the Committee, or our Board. Nonetheless, the Committee and our Board value the opinions of our stockholders. Therefore, to the extent there is any significant vote against the executive compensation as disclosed in this proxy statement, the Committee and our Board will consider our stockholders’ concerns and will evaluate whether any actions are necessary to address those concerns.
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The Board of Directors unanimously recommends a vote FOR the approval of named executive officer compensation, as disclosed in this proxy statement pursuant to the SEC’s compensation disclosure rules.
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2021 Notice and Proxy Statement35

COMPENSATION DISCUSSION AND ANALYSIS
This Compensation Discussion and Analysis (“CD&A”) is intended to provide investors with an understanding of the compensation policies and decisions regarding 2020 compensation for our named executive officers.
For 2020, our named executive officers were:
JOSEPH F. WOODY
CHIEF EXECUTIVE OFFICER

ARJUN R. SARKER
SENIOR VICE PRESIDENT,
INTERNATIONAL
MICHAEL C. GREINER
SENIOR VICE PRESIDENT AND
CHIEF FINANCIAL OFFICER
WILLIAM D. HAYDON
SENIOR VICE PRESIDENT AND
GENERAL MANAGER, PAIN
FRANCHISE
DAVID E. BALL
SENIOR VICE PRESIDENT,
GLOBAL SUPPLY CHAIN & PROCUREMENT
An additional named executive officer who served in 2020 was:
JOHN W. WESLEY
SENIOR VICE PRESIDENT AND
GENERAL COUNSEL
To assist stockholders in finding important information, this CD&A is organized as follows: