DEF 14A of Ipg Photonics Corp, May 9, 2024

DEF 14A of Ipg Photonics Corp

Filed May 9, 2024 · FY20230001111928-24-000077

Open on EDGAR

  1. Director Nominee Qualifications and Attributes

    Director Nominee Qualifications and Attributes

  2. Director Nominee Qualifications and Attributes

    | DIRECTOR INDEPENDENCE | BOARD REFRESHMENT | AGE | GENDER DIVERSITY | | | | | | | 8/11 directors nominees are independent* | 8 years Average Tenure | 63 years Average Age | 36% Female |

  3. Director Nominee Qualifications and Attributes

    * Audit, Compensation and Nominating and Corporate Governance Committees are composed entirely of independent directors. As announced by the Company on April 30, 2024, Dr. Mark Gitin has been appointed CEO of the Company, with employment commencing on June 5, 2024. Dr. Gitin will join the Board on such date effective on the start of his employment, which is expected prior to the annual meeting of stockholders.

  4. Description of Strategic Skills and Strengths

    Description of Strategic Skills and Strengths We believe the Board is more effective by collectively having a mix of competencies and skills and our recent refreshment has improved the mix of experience.

  5. Description of Strategic Skills and Strengths

    | | Lasers and Technology | We have sought directors with management and operational experience in the industries in which we compete. For example, in 2023 we added a director with experience in automation and electronics, and in 2019 we added a director with expertise in optical and electronics components and products. As a diversified technology, science-based company, directors with technology backgrounds understand the Company’s technology platforms and the importance of investing in new technologies for future growth. | | | | | | | Financial Literacy | Knowledge of finance or financial reporting; experience with debt/capital market transactions and/or mergers and acquisitions strengthen the Board’s oversight of financial reporting and internal controls. Financial metrics are used to measure our performance. All directors must understand finance and financial reporting processes. Two of the Audit Committee members qualify as “audit committee financial experts.” | | | | | | | Global Business | Global business experience is critical to the Company’s international operations and growth with 76% of sales from customers outside the U.S. in 2023. Knowledge of Asian and European business practices is valuable to understanding our business and strategy. | | | | | | | Manufacturing and Operating | As a vertically-integrated company, manufacturing experience and customer service on a global scale are important to understanding the operations and capital needs of the Company. | | | | | | | Business Development and M&A | We have used and will continue to use acquisitions to achieve our strategic goals. Directors with experience in business development and mergers and acquisitions provide valuable perspectives regarding process, due diligence, risk assessment and integration of potential partners. For instance, in 2022 we added a director with experience in investment banking and advising on mergers and acquisitions. | | | | | | | Risk Management | In light of the Board’s role in overseeing risk management and understanding the most significant risks facing the Company, including cybersecurity risk, we continue to require directors with experience in risk management and oversight. | | | | | | | Executive Leadership | Significant leadership experience, including services as a CEO, senior executive, division president or functional leader within a complex organization enhances the Board’s leadership role. | | | | | | | Other Public Company Boards | Directors with current or recent membership on other public company boards provide valuable perspectives in many areas including operations, strategy, governance and compensation. | | | | | | | Non-Corporate Experience | Experience from backgrounds beyond the executive suite, including non-corporate backgrounds such as non-profit organizations, government and academia. This experience brings a diversity of perspectives and ensures that the Board's strategic decisions are well-informed by a broad spectrum of societal needs and expectations. | | | | |

  6. Description of Strategic Skills and Strengths

    | Director Nominees |

  7. Description of Strategic Skills and Strengths

    | | Mr. Beecher joined IPG’s Board in January 2023. Mr. Beecher previously served as a Vice President and Chief Financial Officer of Teradyne, Inc. ("Teradyne"), a supplier of automation equipment, from March 2001 to April 2019. Prior to Teradyne, Mr. Beecher served as an Audit Partner at PricewaterhouseCoopers LLP, a provider of business advisory services, from September 1993 to March 2001. He served as a director of MKS Instruments, Inc., a process control instrumentation company, from 2006 to 2020. He also served as a director of Hittite Microwave Corporation, a designer and manufacturer of high performance integrated circuits, modules, subsystems and instrumentation, from 2013 to 2014, and of MatrixOne, a product lifecycle management software provider, from 2003 to 2006, prior to their acquisitions by larger technology companies. Mr. Beecher has served as a trustee on the Isabella Stewart Gardner Museum, an art museum, since 2020. He was previously a licensed Certified Public Accountant in Massachusetts and Vermont from July 1985 to June 2013 and from December 1993 to July 1999, respectively. Mr. Beecher holds a B.S. from the University of Hartford and an M.S. in accounting from Northeastern University. KEY ATTRIBUTES, EXPERIENCE AND SKILLS Mr. Beecher’s extensive financial background, including his previous experience as an audit partner at a public accounting firm and his role as Chief Financial Officer of a publicly traded technology company, as well as his prior service as an outside director to public companies, provides valuable insights for our Board, the Audit Committee and the NCGC. Mr. Beecher is familiar with a large range of management, corporate and board responsibilities and brings valuable perspectives to the Board as an independent director. | | | | | | | | | | Gregory Beecher Independent Director AGE: 66 DIRECTOR SINCE: 2023 COMMITTEES: Audit Committee Nominating and Corporate Governance Committee | | | | | | | | | | | | | | | | | | | | | | | Lasers and Technology | Financial Literacy | Global Business | Manufacturing and Operating | Business Development and M&A | Risk Management | Executive Leadership | Other Public Company Boards | Non- Corporate Experience |

  8. Description of Strategic Skills and Strengths

    | | Mr. Child has served as a member of IPG's Board since September 2000. Mr. Child has been employed by TA Associates, Inc., a private equity investment firm, since July 1982, where he currently serves as Senior Advisor and, prior to January 2011, was a Managing Director. Mr. Child served on the boards of Finisar Corporation, a developer and manufacturer of optical subsystems and components for networks, Eagle Test Systems, Inc., a manufacturer of semiconductor test equipment, and Ultratech Inc., a developer and manufacturer of advanced packaging lithography systems and laser processing technologies. Mr. Child holds a B.S. in Electrical Engineering from the University of California at Davis and an M.B.A. from the Stanford University Graduate School of Business. From September 2011 until December 2015, Mr. Child was a Lecturer at the Stanford University Graduate School of Business. KEY ATTRIBUTES, EXPERIENCE AND SKILLS Mr. Child is an established and experienced investor, including in technology companies, from his three decades of experience at TA Associates, Inc. Over the course of his career, he has overseen numerous investments and sales of portfolio companies, and served on the boards of many public and private companies. Through his experiences, he has gained valuable knowledge in the management, operations and finance of technology growth companies. | | | | | | Michael Child Independent Director AGE: 69 DIRECTOR SINCE: 2000 COMMITTEES: Nominating and Corporate Governance Committee | | | | | | | | | | | | | | | Financial Literacy | Global Business | Business Development and M&A | Risk Management | Other Public Company Boards |

  9. Description of Strategic Skills and Strengths

    | | Ms. Desmond has served as a member of IPG's Board since 2021. Ms. Desmond was the Executive Vice President and Chief Financial Officer of DuPont de Nemours, Inc., a global multi-industry specialty solutions company (“DuPont”), from April 2019 to February 2020. Ms. Desmond served as Vice President and Co-Controller for DuPont from August 2017 to April 2019, and as finance leader for the Specialty Products division following the merger of DuPont with Dow Chemical. Ms. Desmond served in various leadership roles within DuPont in her 30-year career with the company. She also served on the board and was treasurer of the Delaware Prosperity Partnership, a public-private partnership overseeing economic development in Delaware from September 2017 to September 2022. Since 2020, she has served on the board of Trinseo PLC, a materials solutions provider and a manufacturer of plastics, latex binders and synthetic rubber. In October 2021, she joined the board of Sylvamo Corporation, a global producer of uncoated paper. Ms. Desmond earned a B.S. in Accounting from Mt. St. Mary’s University and is a certified public accountant (inactive). KEY ATTRIBUTES, EXPERIENCE AND SKILLS Ms. Desmond brings to the Board substantial finance and accounting experience and extensive experience in technology-driven companies. Her long management experience in a number of key strategic areas including finance leadership and operations financial planning and analysis, tax, internal audit, accounting controls, risk management, mergers and acquisitions, investor relations and public-private partnership brings depth to the skillsets of the Board. | | | | | | | | Jeanmarie Desmond Independent Director AGE: 57 DIRECTOR SINCE: 2021 COMMITTEES: Audit Committee (Chair) Compensation Committee DIRECTORSHIP AT OTHER PUBLIC COMPANY: Sylvamo Corporation and Trinseo PLC | | | | | | | | | | | | | | | | | | | Financial Literacy | Global Business | Business Development and M&A | Risk Management | Executive Leadership | Other Public Company Boards | Non- Corporate Experience |

  10. Description of Strategic Skills and Strengths

    | | Mr. Dougherty has served as a member of IPG's Board since January 2019. Mr. Dougherty served as a director of Fabrinet, a provider of advanced optical packaging and precision optical, electro-mechanical, and electronic manufacturing services to original equipment manufacturers of complex products, from February 2019 to January 2022. Mr. Dougherty served as Chief Executive Officer of Oclaro, Inc., a maker of optical components and modules for the long-haul, metro and data center markets, from June 2013 and has served as a director of Oclaro from April 2009, until its December 2018 acquisition. Prior to Oclaro, Mr. Dougherty served as a director of Avanex Corporation, a leading global provider of intelligent photonic solutions, from April 2005 to April 2009. Mr. Dougherty also served as a director of Picarro, Inc., a manufacturer of ultra-sensitive gas spectroscopy equipment using laser-based technology, from October 2002 to August 2013, and as its Interim Chief Executive Officer from January 2003 to April 2004. From February 2001 until September 2002, Mr. Dougherty was the Chief Operating Officer at JDS Uniphase Corporation (“JDS”), an optical technology company. Prior to JDS he was the Chief Operating Officer of SDL, Inc., a maker of laser diodes, from March 1997 to February 2001 when they were acquired by JDS. Mr. Dougherty serves on the boards of Infinera Corporation, a provider of optical transport networking equipment, software and services to telecommunications service providers and others, since January 2019, and MaxLinear, Inc., a provider of radio frequency (RF), analog and mixed-signal integrated circuits, since March 2020. Mr. Dougherty earned a B.S. in optics from the University of Rochester. KEY ATTRIBUTES, EXPERIENCE AND SKILLS Mr. Dougherty contributes to the Board significant leadership, operations, sales, marketing and general management experience in optics and components for telecommunications and other applications. For over three decades, Mr. Dougherty has worked in the optical and components industry and can provide the Board with insight into the industry and conditions in which the Company operates. Having been recently a CEO at a publicly-held company and now serving as a member on the boards of optical and electronics companies, he is familiar with a large range of management, corporate and board responsibilities and brings valuable perspectives to the Board as an independent director. | | | | | | | | | | Gregory Dougherty Independent Director AGE: 64 DIRECTOR SINCE: 2019 COMMITTEES: Compensation Committee (Chair) Audit Committee DIRECTORSHIP AT OTHER PUBLIC COMPANY: Infinera Corporation and MaxLinear, Inc. | | | | | | | | | | | | | | | | | | | | | | | Lasers and Technology | Financial Literacy | Global Business | Manufacturing and Operating | Business Development and M&A | Risk Management | Executive Leadership | Other Public Company Boards | Non- Corporate Experience |

  11. Description of Strategic Skills and Strengths

    | | Dr. Gitin was appointed CEO of the Company on April 25th, effective June 5, 2024, and to the Company's Board of Directors, effective on the start of his employment. Prior to IPG, Dr. Gitin served as Executive Vice President and General Manager, Photonics Solutions Division of MKS Instruments, Inc. Dr. Gitin joined MKS in September 2017 as Vice President and General Manager of the Photonics Business Unit and in 2018, also assumed responsibility for the Instruments and Motion Business Unit. Prior to joining MKS, from March 1995 to September 2017, Dr. Gitin held various management positions covering a wide range of technologies at Coherent, Inc., including Vice President of Strategic Marketing, Vice President of Business Development, and Vice President and General Manager of the Diodes, Fibers and Systems Business Unit. Dr. Gitin holds a B.S. in Electrical Engineering from University of California, Davis and an M.Eng. and Ph.D. in Electrical Engineering from Cornell University. KEY ATTRIBUTES, EXPERIENCE AND SKILLS Dr. Gitin has more than 30 years of experience in the lasers and optics sector and possesses extensive technical and scientific expertise. Dr. Gitin brings a strong track record as a strategic industry leader with the ability to identify and execute growth opportunities. As the Chief Executive Officer elect, Dr. Gitin will report to the Board and will have responsibility for managing the general business and affairs of the Company. Dr. Gitin's service as chief executive officer of the Company will provide the Board with direct knowledge and understanding of the Company’s operations. | | | | | | | | Mark Gitin, Ph.D. Chief Executive Officer elect AGE: 57 DIRECTOR SINCE: 2024* COMMITTEES: None | | | | | | | | | | | | | | | | | | | Lasers and Technology | Financial Literacy | Global Business | Manufacturing and Operating | Business Development and M&A | Risk Management | Executive Leadership |

  12. Description of Strategic Skills and Strengths

    * As announced by the Company on April 30, 2024, Dr. Gitin has been appointed CEO of the Company, with employment commencing on June 5, 2024. Dr. Gitin will join the Board on such date effective on the start of his employment, which is expected prior to the annual meeting of stockholders.

  13. Description of Strategic Skills and Strengths

    | | Ms. Kennedy joined IPG’s Board in August 2023. Ms. Kennedy retired as President, Proton Solutions & Chief Growth Officer at Varian Medical Systems (“Varian”), a supplier of healthcare solutions and services, in December 2021. Ms. Kennedy served in several strategic roles at Varian over 24 years, including President, Proton Solutions and Chief Growth Officer from October 2018 to December 2021, Executive Vice President and President, Oncology Systems from October 2014 to September 2018, and Senior Vice President and President, Oncology Systems from October 2011 to September 2014. Prior to Varian, Ms. Kennedy was with Siemens Medical Systems and Radiation Oncology Computer Systems in oncology product sales and marketing. Ms. Kennedy serves as a member of the board of ICU Medical, Inc., manufacturer of medical technologies, since December 2021 and the non-profit Wayne State University Foundation since April 2018. Ms. Kennedy holds B.S. degrees in Radiation Oncology and Psychology from the Wayne State University and a M.S. in Medical Physics from the University of Colorado Denver. KEY ATTRIBUTES, EXPERIENCE AND SKILLS Ms. Kennedy’s experience as President and Chief Growth Officer brings enhanced skills in identifying and nurturing growth opportunities, strategic planning, and business development to the Board. Ms. Kennedy also possesses a strong blend of leadership experience, medical device industry-specific knowledge, operational, acquisition and strategic planning skills that provide the Board with an independent director with the requisite background to evaluate and guide the Company in addressing opportunities and challenges with our medical products and the markets we serve. | | | | | | | | | Kolleen Kennedy Independent Director AGE: 64 DIRECTOR SINCE: 2023 COMMITTEES: None DIRECTORSHIP AT OTHER PUBLIC COMPANY: ICU Medical, Inc. | | | | | | | | | | | | | | | | | | | | | Financial Literacy | Global Business | Manufacturing and Operating | Business Development and M&A | Risk Management | Executive Leadership | Other Public Company Boards | Non- Corporate Experience |

  14. Description of Strategic Skills and Strengths

    | | Mr. Meurice has served as a member of IPG's Board since June 2014. Mr. Meurice was President and Chief Executive Officer of ASML Holding NV, a provider of semiconductor manufacturing equipment and technology, from October 2004 to June 2013, and Chairman until March 2014. From 2001 to 2004, he was Executive Vice President of the Thomson Television Division of Thomson, SA, an electronics manufacturer. From 1995 to 2001, he served as head of Dell Computer’s Western, Eastern Europe and EMEA emerging market businesses. Before 1995, he gained significant technology experience at ITT Semiconductors and at Intel Corporation. Mr. Meurice served on the boards of UMICORE S.A., a recycling and materials company, from April 2015 to April 2023, NXP Semiconductors N.V., a semiconductor company, from April 2014 to June 2019, Meyer Burger Technology AG, a solar equipment vendor, from May 2018 to May 2019, ARM Holdings plc, a semiconductor intellectual property supplier, from July 2013 to March 2014, and Verigy Ltd., a manufacturer of semiconductor test equipment, until its acquisition by Advantest Corporation in 2011. Mr. Meurice serves on the boards of Soitec S.A., a semiconductor materials manufacturer, since July 2018, and where he was appointed Chairman in March 2019, and Global Blue Group Holding AG, a leader in currency and value added tax processing, since September 2020. Mr. Meurice earned a Master’s degree in Mechanics and Energy Generation at the Ecole Centrale de Paris, a Master’s degree in Economics from la Sorbonne University, Paris, and an M.B.A. from the Stanford University Graduate School of Business. KEY ATTRIBUTES, EXPERIENCE AND SKILLS Mr. Meurice has extensive skills and experience as a manager of several rapidly-growing, complex and global businesses in the capital equipment and electronics fields with several billions of dollars in revenues, most recently as former President and Chief Executive Officer of ASML Holding NV. He has experience managing a publicly-held company as well as experience on serving on several public company boards in the equipment and technology fields. Mr. Meurice also has a record of proven leadership as a strategic thinker, operator and marketer at the businesses he managed. | | | | | | | | | Eric Meurice Independent Director AGE: 67 DIRECTOR SINCE: 2014 COMMITTEES: Nominating and Corporate Governance Committee (Chair) Compensation Committee DIRECTORSHIP AT OTHER PUBLIC COMPANY: Soitec S.A. and Global Blue Group Holding AG | | | | | | | | | | | | | | | | | | | | | Lasers and Technology | Financial Literacy | Global Business | Manufacturing and Operating | Business Development and M&A | Risk Management | Executive Leadership | Other Public Company Boards |

  15. Description of Strategic Skills and Strengths

    | | Ms. Pavlova has served as a member of IPG's Board since January 2021. Ms. Pavlova has served in a variety of roles at non-profit art institutions including the Museum of Art, Rhode Island School of Design (RISD Museum), Worcester Historical Museum and The Willard House and Clock Museum. She also worked in sales and marketing roles at IPG previously. Ms. Pavlova holds a Qualification for Fine Art Critic and Historian of Art and Culture from the Russian State University for the Humanities, and an M.S. in Arts Administration from Boston University. She is the spouse of co-founder and Senior Vice President, Chief Scientist, Igor Samartsev. KEY ATTRIBUTES, EXPERIENCE AND SKILLS As a significant stockholder with family association to founders of the Company as well as having served as an employee of the Company in sales and marketing, Ms. Pavlova’s membership on the Board provides it with further engagement by individuals having a long-term perspective and strong economic ties with the Company. Among her specific attributes that qualify her to serve as a member of the Board, Ms. Pavlova possesses extensive knowledge of our history and culture. Ms. Pavlova strengthens the connection between the Company’s founding members and our Board, thereby assisting in the alignment of the Board with the interests of all IPG stockholders. Her experience working for nonprofit organizations adds different perspectives to the boardroom. | | | Natalia Pavlova AGE: 45 DIRECTOR SINCE: 2021 COMMITTEES: None | | | | | | | | | Financial Literacy | Non- Corporate Experience |

  16. Description of Strategic Skills and Strengths

    | | Mr. Peeler became IPG's non-executive Chair of the Board on October 29, 2021. Mr. Peeler was appointed to IPG's Board in 2012 and served as the Lead Independent Director from 2017 to 2021. Mr. Peeler has been acting CEO of Jumplights Corp., a producer of LED horticultural lighting, since June 2021. He was previously the Chief Executive Officer of Veeco Instruments Inc. (“Veeco”) from July 2007 until September 2018, and Chairman or Executive Chairman of its board of directors from May 2012 until May 2020. Veeco is a developer and manufacturer of MOCVD, molecular beam epitaxy, ion beam and other advanced semiconductor processes equipment. He was Executive Vice President of JDS and President of the Communications Test & Measurement Group of JDS, which he joined upon the closing of JDS’s merger with Acterna, Inc. in August 2005. Before joining JDS, Mr. Peeler served as President and Chief Executive Officer of Acterna. In March 2021, Mr. Peeler joined the board of WaveArray Antifouling Systems, LLC, a producer of antifouling solutions, and in June 2021, he joined the board of Jumplights Corp. He has a B.S. and M.E. in Electrical Engineering from the University of Virginia. KEY ATTRIBUTES, EXPERIENCE AND SKILLS Over the course of his career, Mr. Peeler has managed several high-growth technology companies. In addition, he has developed managerial leadership skills through his former position as Chief Executive Officer of Veeco, a publicly-traded company with substantial international operations. His managerial positions have provided him with in-depth knowledge of the service needs of customers in demanding markets, including semiconductor capital equipment, various manufacturing models, research and development, marketing and sales. In these roles, he has also been responsible for attracting and incentivizing executives on his team. These experiences have provided him important insights in support of his positions as non-executive Chair and a member of the Compensation Committee and the NCGC. | | | | | | | | | John Peeler Non-Executive Chair Independent Director AGE: 69 DIRECTOR SINCE: 2012 COMMITTEES: Compensation Committee Nominating and Corporate Governance Committee | | | | | | | | | | | | | | | | | | | | | Lasers and Technology | Financial Literacy | Global Business | Manufacturing and Operating | Business Development and M&A | Risk Management | Executive Leadership | Other Public Company Boards |

  17. Description of Strategic Skills and Strengths

    | | Dr. Scherbakov became the Chief Executive Officer of IPG in May 2021. It is expected that Dr. Scherbakov will transition to a role as advisor to the Company following the appointment of Dr. Gitin as CEO on June 5, 2024. He has served as a member of IPG's Board since September 2000. He previously served as Chief Operating Officer of IPG from February 2017, Managing Director of IPG Laser GmbH, IPG's German subsidiary, since August 2000 and Senior Vice President-Europe since February 2013. He served as the Technical Director of IPG Laser from 1995 to August 2000. From 1983 to 1995, Dr. Scherbakov was a senior scientist in fiber optics and head of the optical communications laboratory at the General Physics Institute, Russian Academy of Science in Moscow. Dr. Scherbakov graduated from the Moscow Physics and Technology Institute with an M.S. in Physics. In addition, Dr. Scherbakov attended the Russian Academy of Science in Moscow, where he received a Ph.D. in Quantum Electronics from its Lebedev Physics Institute and a Doctor of Science degree in Laser Physics from its General Physics Institute. KEY ATTRIBUTES, EXPERIENCE AND SKILLS As the current Chief Executive Officer, Dr. Scherbakov reports to the Board and has responsibility for managing the general business and affairs of the Company. Previously as Managing Director of IPG Laser GmbH, which produces a large volume of our products and is the source of many developments in products, technology and applications, he developed extensive knowledge of the Company’s business. He applies his knowledge and experience across our many international branches. The leadership and operational expertise of Dr. Scherbakov have contributed to IPG increasing production, lowering manufacturing costs, managing risk and maintaining high margins compared to our industry peers. He also has extensive technological knowledge of fiber lasers, their components and manufacturing processes. His long-term service as an executive officer of the Company provides the Board with a detailed understanding of the Company’s operations, sales and customers. | | | | | | | | Eugene Scherbakov Chief Executive Officer AGE: 76 DIRECTOR SINCE: 2000 COMMITTEES: None | | | | | | | | | | | | | | | | | | | Lasers and Technology | Financial Literacy | Global Business | Manufacturing and Operating | Business Development and M&A | Risk Management | Executive Leadership |

  18. Description of Strategic Skills and Strengths

    | | Ms. Tang has served as a member of IPG's Board since March 2022. Ms. Tang is a Founding Partner at Ducera Partners LLC, which offers strategic advisory, mergers and acquisitions, capital advisory, liability, management and restructuring advisory services. Prior to joining Ducera in 2015, Ms. Tang was a Managing Director in the New York Office of Perella Weinberg Partners from 2008 to 2015. Prior to joining Perella Weinberg, Ms. Tang was an investment banking professional at Houlihan Lokey, and a strategy consultant at The Oliver Wyman Group, a business division of Marsh & McLennan Companies. Ms. Tang received a B.A. in Economics from Northwestern University and a M.B.A. from the Harvard Business School. KEY ATTRIBUTES, EXPERIENCE AND SKILLS Ms. Tang's experience working across a range of industry sectors and different size companies provides her with a broad perspective in how companies manage to maximize business opportunity potential. Specializing in situations with multi-dimensional complexities and risks, Ms. Tang has more than twenty years of experience working to find creative solutions for companies at strategic crossroads. She brings to the Board a combination of strategy, operational and financial acumen and a commitment to partnership and collaboration. | | | | | Agnes Tang Independent Director AGE: 50 DIRECTOR SINCE: 2022 COMMITTEES: Audit Committee | | | | | | | | | | | | | Financial Literacy | Global Business | Business Development and M&A | Risk Management |

  19. Description of Strategic Skills and Strengths

    | The Board recommends that you vote FOR each director nominee named in this Proxy Statement. |

  20. Directors

    Directors

  21. Directors

    | Board Refreshment and Composition |

  22. Board Diversity Matrix

    | Director Compensation |

  23. Director Compensation Table

    Director Compensation Table The following table summarizes the compensation of each of our non-employee directors for 2023:

  24. Director Compensation Table

    | Name | Fees Earned or Paid in Cash ($) | Stock Awards ($)(1) | Total ($) | | Gregory Beecher(2) | 59,648 | 374,857 | 434,505 | | Michael Child | 47,500 | 249,957 | 297,457 | | Jeanmarie Desmond | 73,125 | 249,957 | 323,082 | | Gregory Dougherty | 75,000 | 249,957 | 324,957 | | Kolleen Kennedy(2) | 20,000 | 249,988 | 269,988 | | Eric Meurice | 61,425 | 249,957 | 311,382 | | Natalia Pavlova | 40,000 | 249,957 | 289,957 | | John Peeler | 136,667 | 249,957 | 386,624 | | Thomas Seifert(3) | 6,042 | — | 6,042 | | Agnes Tang | 51,459 | 249,957 | 301,416 |

  25. Director Compensation Table

    (1)The amount reported is equal to the fair value of the RSU awards as of the grant date determined pursuant to Financial Accounting Standards Board Accounting Standards Codification Topic 718 ("ASC Topic 718") disregarding any estimates of forfeitures related to service-based vesting. The assumptions that we used with respect to the valuation of RSU awards are set forth in Note 15 to our Consolidated Financial Statements in our Annual Report. (2)Mr. Beecher and Ms. Kennedy joined the Board on January 20, 2023 and August 1, 2023, respectively. (3)Mr. Seifert resigned from the Board on February 27, 2023.

  26. Director Compensation

    Director Compensation

  27. Outstanding Equity Awards Table

    Outstanding Equity Awards Table The following table provides information regarding unexercised stock options and unvested RSUs held by each of our non-employee directors on December 31, 2023:

  28. Outstanding Equity Awards Table

    | Name | Unvested Restricted Stock Units (#) | Total Number of Shares Underlying Option Awards Held (#) | | Gregory Beecher | 2,999 | — | | Michael Child | 2,188 | 17,078 | | Jeanmarie Desmond | 2,188 | — | | Gregory Dougherty | 2,188 | 3,259 | | Kolleen Kennedy | 2,296 | — | | Eric Meurice | 2,188 | 14,378 | | Natalia Pavlova | 2,188 | — | | John Peeler | 2,188 | 7,576 | | Agnes Tang | 2,188 | — |

  29. Outstanding Equity Awards Table

    The Company no longer grants stock options to non-employee directors. All previously-granted options were vested as of December 31, 2023. Our Charter limits the dollar amount of personal liability of our directors for breaches by them of their fiduciary duties. Our Charter requires us to indemnify our directors to the fullest extent permitted by the Delaware General Corporation Law ("DGCL"). We have also entered into indemnification agreements with all of our directors and we have purchased directors’ and officers’ liability insurance.

  30. Objectives of Director Compensation

    Objectives of Director Compensation Quality non-employee directors are critical to our success. We believe that the two primary duties of non-employee directors are to effectively represent the long-term interests of our stockholders and to provide guidance to management. As such, our compensation program for non-employee directors is designed to meet several key objectives: •Adequately compensate directors for their responsibilities and time commitments and for the personal liabilities and risks that they face as directors of a public company. •Attract the highest caliber non-employee directors by offering a compensation program consistent with those at companies of similar size, complexity and business character. •Align the interests of directors with our stockholders by providing a significant portion of compensation in equity and requiring directors to own our stock. •Provide director compensation that is simple and transparent to stockholders and reflects corporate governance best practices.

  31. Elements of Director Compensation

    Elements of Director Compensation We believe that the following components of our director compensation program support the objectives above: •We provide cash compensation through retainers for Board and committee service, as well as additional cash retainers to the non-executive Chair of the Board and chairs of our standing Board committees. We do not provide Board and committee meeting fees. Compensating our directors in this manner simplifies the administration of our program and creates greater equality in rewarding service on committees of the Board. The additional retainers for Board or committee leadership compensate directors for the additional responsibilities and time commitments involved with chair responsibilities. •We pay for, provide or reimburse directors for expenses, including business class travel, incurred to attend Board and committee meetings and director education programs. We do not pay our non-employee directors any additional payments or perquisites. •Directors do not have a retirement plan. •Directors who are also employees receive no additional compensation for service on the Board.

  32. Director Compensation

    Director Compensation

  33. Determining Director Compensation

    Determining Director Compensation Our Compensation Committee reviews our director compensation program every other year to confirm that the program remains appropriate and competitive and recommends any changes to our full Board for consideration and approval. In 2023, the Compensation Committee engaged Aon's Human Capital Solutions practice, a division of Aon plc ("Aon"), an independent compensation consultant, to provide a comprehensive review of compensation for non-employee directors in comparison to the same compensation peer group used for the Company’s executive compensation analysis. The analysis included review of cash retainers, initial and annual equity grants, vesting schedules, and meeting fees for Board and committee service. Based upon its review, in 2023 the Compensation Committee determined that the director compensation continues to be appropriate in general but recommended an increase in the non-executive Chair annual retainer to $80,000 from $70,000, which change was approved by the Board.

  34. DETERMINING NON-EMPLOYEE DIRECTOR COMPENSATION

    DETERMINING NON-EMPLOYEE DIRECTOR COMPENSATION

  35. DETERMINING NON-EMPLOYEE DIRECTOR COMPENSATION

    | 1 | | 2 | | 3 | | The Compensation Committee engages independent compensation consultant to review compensation of non-employee directors as compared to peer group | | The Compensation Committee evaluates the independent compensation consultant's report, compensation trends and need to retain and attract high caliber non-employee directors consistent with comparable companies | | The Board considers changes to non-employee directors compensation program recommended by the Compensation Committee |

  36. Our Business and Our Compensation Philosophy

    | | Primary Compensation Elements | | Objective | | | Base Salary | | •Provide a competitive fixed component of cash compensation to attract and retain talented and experienced executives with the knowledge and skills necessary to achieve the Company’s strategic business objectives •The Compensation Committee uses the services of an independent compensation consultant to assess the base salaries as compared to a competitive target range of the Company’s peer group and a larger group of technology companies •The Compensation Committee considers these factors when setting base salaries of the NEOs: scope of the NEO's responsibilities, contributions, skills, knowledge, experience, seniority and annual and long-term Company performance | | | CEO | OTHER NEOs | | | | | | | | | Annual Incentive Plan | | •Offer a variable cash compensation opportunity that may be earned based upon the level of achievement of challenging corporate goals, with an additional compensation opportunity based upon individual performance •Foster a shared commitment among executives through establishment of uniform Company financial goals •Award payouts are subject to a cap of 225% of target in a performance period | | | CEO | OTHER NEOs | | | | | | | | | Long-Term Incentives | | •Align interests of our NEOs and stockholders by motivating executive officers to increase long-term stockholder value •50% of long-term incentives are eligible to be earned based upon performance measures •PSUs provide an additional incentive to our NEOs based on performance. 50% of PSUs are based on the Company's organic revenue growth and 50% are based upon operating margin, measuring the Company's performance over three years •Service-based equity awards consist of RSUs. They offer long-term retention while providing alignment with stockholder value creation •Enhance retention with RSUs vesting one-third annually over three years and PSUs cliff vesting after three years | | | CEO | OTHER NEOS | | | | | | | | | Performance-based Equity Award (PSUs) & Service-based Equity Award (RSUs) | | |

  37. Annual Incentives

    Annual Incentives A significant portion of the individual’s potential short-term compensation is in the form of annual cash incentive pay tied to the achievement of goals set by the Compensation Committee under our Senior Executive AIP administered by the Compensation Committee. The Compensation Committee determines who is eligible to receive awards under the AIP, defines performance goals and objectives for executives, establishes target awards for each participant for the relevant performance period, and determines the percentage of the target award that should be allocated to the achievement of each of the chosen performance goals. After the end of the fiscal year, the independent directors and the Compensation Committee determined the amount of the CEO’s and each NEO’s actual annual incentive award, respectively, based upon its evaluation of achievement against pre-determined goals. At target, the financial performance payout accounts for 75% of the overall target award and personal performance payout accounts for 25% of the target award. After review and consideration of data provided by the Committee’s independent compensation consultant related to annual incentive plan payout ranges at peer companies, the Compensation Committee determined that the payout for meeting the threshold level of both financial goals would be 50% of the target award subject to the applicable financial performance metric, rather than 25%, the level used in prior years. Therefore, the financial performance portion of the award can be earned at 50%-267% of target with respect to each goal for threshold-to-maximum performance, with a payout of 100% at target performance and no payout for below threshold performance. The CEO can earn up to 25% of his target award based upon goals and objectives determined by the independent directors. The other NEOs also are eligible for payouts up to 25% of the target award based on their individual performance in support of the CEO’s goals and other objectives, the recommendation of the CEO, and other factors the Compensation Committee deems relevant. The maximum opportunity under the AIP is 225% of the target payout. The Compensation Committee approved annual performance targets and targeted individual payouts for the Company’s NEOs and other executive officers for fiscal year 2023. Consistent with prior years, the Compensation Committee identified two financial performance measures: net sales and adjusted EBIT, each as determined under the AIP, and assigned a 50% weighting factor to each financial performance goal. The Compensation Committee chose to focus on net sales and adjusted EBIT so that our NEOs and other executive officers would be incentivized to deliver the types of financial performance that benefit our stockholders, namely sales and profits. The annual incentive targets were set at 110% and 80% of base salary for the CEO and other NEOs, respectively, which was consistent with the target awards as a percentage of base salary set in 2022. The Compensation Committee established the goals early in the fiscal year 2023 and evaluated achievement of the goals after year-end. The Compensation Committee set the performance goals based upon the best available information at the time, in the context of macroeconomic uncertainty surrounding the second half of the year, namely a potential U.S. recession related to interest rate increases and lack of recoveries in China and Europe. The goals were designed to be challenging and were expected to incentivize the NEOs to advance IPG’s strategic and operational priorities. In early 2024, the Compensation Committee determined a payout percentage based on its evaluation of results against net sales and adjusted EBIT targets as approved in the AIP approved in February 2023 and no adjustments were made to the financial performance targets approved by the Committee in early 2023. Adjusted EBIT is defined as the Company's earnings before interest and taxes and excludes stock-based compensation and foreign exchange transaction gains and losses, consistent with prior years. GAAP net sales as reported in our financial statements was used for purposes of the AIP. Our net sales declined 10% from the prior year as a result of soft industrial demand in China and Europe and increased competition in China in competitive markets like flat-sheet cutting. Also, currency translation negatively impacted revenue by 2% due to the strong U.S. dollar. Profits were adversely impacted by lower revenue and reduced overhead absorption. As a result, net sales of $1.287 million fell short of the target of $1,516 million. Threshold and maximum net sales levels under the AIP were $1,365 million and $1,668 million, respectively. Adjusted EBIT of $274 million also fell short of the target of $428 million due to the factors described above. Threshold and maximum adjusted EBIT levels under the AIP were $334 million and $507 million, respectively. Consistent with our pay-for-performance philosophy and due to below threshold performance against the financial performance goals, no payout was made under the 2023 AIP for financial performance. Individual performance goals for the CEO were established by the independent directors early in 2023. Following a review of the CEO’s self-assessment of performance against his goals, the independent directors determined that the payout percentage for the individual performance portion of the CEO's AIP award would be 70% of his target. His performance included achieving important goals relating to initiatives to increase manufacturing resilience and restructure operations following restrictions on our Russia and Belarus operations from the Ukraine conflict, capital allocation planning and sale of several properties. However, the Company fell short of goals for revenue growth, inventory management and organizational development. The Compensation Committee evaluated each of the other NEO’s individual performance based on each NEO’s self-assessment and Dr. Scherbakov’s recommendation. The other NEOs earned payouts for the individual performance components of the AIP at 95% of target based upon their individual goals as reviewed by the Committee, success in working toward strategic goals and addressing the multifaceted challenges in 2023. The fiscal year 2023 annual cash incentive award payments are included in the “Non-Equity Incentive Plan Compensation” column of the Executive Compensation – Summary Compensation Table and are set forth in the following table.

  38. Annual Incentives

    | | | Target(1) | | | | Actual | | | | | | | Annual Base Salary | Target Annual Incentive % | Corporate Performance Target (weighting) | Personal Performance Target (weighting) | Target Annual Incentive $ | Financial | | Personal | Final Award as % of Target | Final Award $ | | | | | | | | Performance % | | Performance % | | | | Eugene Scherbakov | $864,889 | 110% | 75% | 25% | $951,378 | —% | + | 70% | 17.5% | $166,491 | | Timothy Mammen | $538,700 | 80% | 75% | 25% | $430,960 | —% | + | 95% | 23.8% | $102,353 | | Angelo Lopresti | $485,500 | 80% | 75% | 25% | $388,400 | —% | + | 95% | 23.8% | $92,245 | | Trevor Ness | $477,100 | 80% | 75% | 25% | $381,680 | —% | + | 95% | 23.8% | $90,649 | | Alexander Ovtchinnikov | $481,000 | 80% | 75% | 25% | $384,800 | —% | + | 95% | 23.8% | $91,390 |

  39. Annual Incentives

    (1)The "threshold" and "maximum" amounts are provided in the 2023 Grants of Plan-Based Awards table.

  40. Long-Term Incentives

    Long-Term Incentives The goal of our equity-based award program is to provide employees and executives with the perspective of an owner having a long-term financial stake in our success, further increasing alignment with stockholders. Our equity-based incentives align the interests of our executives and stockholders by motivating executives to increase long-term stockholder value. In 2023, our equity-based award program for our NEOs included PSUs and RSUs, with each award type representing half of the overall 2023 long-term incentive award opportunity (at target for the PSUs). The type and proportion of the equity grants reflected a review by our Compensation Committee with the assistance of Aon of equity award practices at peer companies. The Committee believes that granting a balance of PSUs and RSUs appropriately aligns executive compensation with the achievement of the Company’s strategic goals and long-term stockholder value creation. Additionally, the value of the PSUs and RSUs are tied to the Company's stock price which further links pay to performance.

  41. Long-Term Incentives

    | 2023 EQUITY ELEMENTS (at target) |

  42. Long-Term Incentives

    In February 2023, the Compensation Committee determined to keep long-term performance metrics the same as 2022, but with different financial targets, thresholds and maximums. The Compensation Committee approved 2023 awards comprised of PSUs based upon organic revenue growth (at target, 25% of award value), and operating margin (at target, 25% of award value), and service-based RSUs (50% of award value). The Committee chose organic revenue growth and operating margin as the PSU performance metrics because they are generally accepted as two fundamental drivers of sustained stockholder value and provide clearer line-of-sight measurements than many alternative measures. For the PSUs based upon organic revenue growth, the value of the PSU is based upon the compound annual growth rate of organic revenue over a three-year performance period starting on January 1, 2023, and ending on December 31, 2025. Organic revenue means total revenues, as determined under GAAP and recorded in our audited financial statements, excluding the impact of acquisitions and dispositions. For the 2023 awards, the target growth rate for the three year period was set based upon the annual budget approved by the Board for the then present year with the intent to incentivize and reward executives and other senior employees for achieving targeted revenue growth. The performance of operating margin to the target for each individual year in the performance period is averaged over the three-year performance period to calculate the final award earned. Operating margin is calculated by dividing our GAAP operating income by GAAP net sales. However, for purposes of this calculation, operating income will be adjusted to exclude stock-based compensation, the impact of all restructurings, impairments, legal settlements, employee separation costs, product liability charges, foreign exchange transaction gains and losses, to the extent such items were not contemplated and included in the target upon which the operating margin goals were based. Performance below the target results in below target payout, subject to a minimum performance level below which no award would be earned, and performance above the target results in payout above target, subject to a maximum cap of 200% of the target award and dollar payout cap of 600% of the value of the target award on the date of grant. Forward-looking targets for our PSUs are not disclosed as doing so could result in competitive harm and be detrimental to our operating performance. The goals will be disclosed at the end of the performance period along with the achievement levels and corresponding vesting of the performance-based restricted stock awards, if any. PSUs, which cliff vest to the extent earned in March 2026 following the end of the three-year performance period, serve as a valuable retention tool and motivate executives to achieve our longer-term business objectives. RSUs vest annually over a three-year period and also encourage retention. PSUs and RSUs granted in 2023 are entitled to dividends equivalents, should any dividends be paid. Any dividends equivalents on shares underlying the PSUs and RSUs are not paid unless and until the corresponding awards vest. In 2023, the Compensation Committee used competitive market data from the total compensation study of peer companies and broader market survey data to gain perspective of appropriately competitive executive compensation. The Compensation Committee analyzed several aspects of the equity grant program, including (i) the degree to which executives have incentives to remain employed by the Company through unvested award value and (ii) the aggregate equity usage in terms of (a) annual usage, typically called burn rate and (b) cumulative equity delivery, typically called overhang, to determine the dilutive effect of equity awards on investors. The table below provides information on grants of PSUs and RSUs to the NEOs in 2023.

  43. Long-Term Incentives

    | Name | Equity Incentive as a Percentage of Base Salary (%) | Service-Based Restricted Stock Units (#) | Operating Margin PSUs (at Target) (#) | Operating Margin PSUs Range (Based upon Achievement) (#) | Organic Revenue Growth PSUs (at Target) (#) | Organic Revenue Growth PSUs Range (Based upon Achievement) (#) | | Eugene A. Scherbakov | 525 | 16,837 | 8,418 | 0 - 16,836 | 8,418 | 0 - 16,836 | | Timothy P.V. Mammen | 300 | 6,160 | 3,080 | 0 - 6,160 | 3,080 | 0 - 6,160 | | Angelo P. Lopresti | 275 | 5,089 | 2,544 | 0 - 5,088 | 2,544 | 0 - 5,088 | | Trevor Ness | 275 | 5,001 | 2,500 | 0 - 5,000 | 2,500 | 0 - 5,000 | | Alexander Ovtchinnikov | 275 | 5,042 | 2,521 | 0 - 5,042 | 2,521 | 0 - 5,042 |

  44. Long-Term Incentives

    Actual Performance of Performance-Based Stock Units. Half of the PSUs granted in 2020 were eligible to be earned based on the relative stock performance of the Company's share price compared to the S&P Composite 1500 Electronic Equipment, Instrument and Component Index ("relative TSR") over the three year period beginning on March 1, 2020 and ending on March 1, 2023. Because the Company's relative TSR underperformed the S&P Electronics Index by more than 25%, no award was earned for the relative TSR PSUs. Similarly, no relative TSR PSUs were earned for the 2018 and 2019 grants, illustrating the alignment of the NEOs’ pay with the Company's pay for performance philosophy. Half of PSUs granted in 2021 were eligible to be earned based on the ratio of operating cash flow to adjusted net income ("OCF PSUs") over a three-year performance period beginning January 1, 2021 and ending December 31, 2023. Such OCF PSUs vested in March 2024 at 66.3% of target. 2024 Update. In order to provide additional incentive and to motivate the NEOs to drive continued future performance in 2024 and beyond, the Committee approved a one-time, additional target value opportunity in 2024 to the NEOs other than the CEO, representing an increase of 40% over the annual LTI award.

  45. Other Compensation

    Other Compensation Severance Benefits. The severance benefits that we offer to our NEOs assist us in recruiting and retaining talented individuals and are consistent with the range of severance benefits offered by our peer group. The severance provisions of our NEO employment agreements are summarized in Potential Payments upon Termination or Change in Control below. Retirement Benefits. We do not offer an executive retirement plan or a non-qualified deferred compensation plan. Executives in the United States are eligible to participate in our 401(k) retirement savings plan on the same terms as all other U.S. employees. Our 401(k) retirement savings plan is a tax-qualified plan and therefore is subject to certain Internal Revenue Code limitations on the dollar amounts of deferrals and Company contributions that can be made to plan accounts. These limitations apply to our more highly-compensated employees (including the NEOs). We made matching contributions to our employees at a rate of 50% of deferrals subject to a maximum of 6% of eligible compensation under the 401(k) retirement savings plan, including the NEOs, who participate in the plan as set forth in the Summary Compensation Table. Dr. Scherbakov has historically participated in a German government-sponsored retirement program. Moving and Living Expenses. In 2021, in connection with his appointment as CEO, the Company agreed to pay or reimburse Dr. Scherbakov for his expenses related to his employment in the United States, including housing. In 2023, these expenses included automobile, housing, medical and dental insurance, and tax preparation expenses. Dr. Scherbakov maintains his residence in Germany at his sole cost where he spends a portion of his time managing the Company and overseeing the Company's substantial European operations. The expenses related to his living in the U.S. are grossed up for taxes. While the Company generally does not provide gross-up payments for taxes to our senior executives in connection with perquisites and benefits, the Company determined to provide Dr. Scherbakov gross-up payments in connection with his stays in the U.S., and any related international tax compliance payments, because such expenses are incurred as a result of the Company’s request to perform his duties in the United States. Personal Benefits. Our executives are eligible to participate in employee benefit plans, including medical, dental, life and disability insurance and vacation plans as well as an employee stock purchase plan, which is intended to be qualified under Section 423 of the Internal Revenue Code. The employee stock purchase plan allows participants to purchase Company shares at a price equal to 85% of the lesser of the fair market value at the first day or last day of the six month offering period, subject to limitations on the amount of shares. These plans generally are available to all salaried employees and do not discriminate in favor of executives. Benefits are intended to be competitive with the overall market in order to facilitate attraction and retention of highly-qualified employees. The Compensation Committee compared the Company’s executive perquisites policies against the 2022 peer group and made no changes. The Company provides the use of a corporate aircraft to the CEO and other executives for business travel integral to the performance of their duties. The Company sold its corporate aircraft in 2022 and until December 2023 it leased a limited number of hours annual for executive travel. Executives are encouraged to use the aircraft for efficiency, safety and security. However, executives are not allowed to use the aircraft for personal use unless they fully reimburse the Company for the cost, except that family and other guests may accompany executives on the aircraft for business travel. In addition, exceptions are allowed for extenuating circumstances such as compassionate circumstances. The Company provides Dr. Scherbakov use of an automobile in the United States and Germany.

  46. Role of Compensation Committee

    Role of Compensation Committee The Compensation Committee determines, approves and administers the compensation programs for our executive officers, including our NEOs. The Compensation Committee recommends to the independent directors the CEO’s annual base salary, annual incentive opportunity and long-term incentive opportunity. The independent directors approve the CEO’s compensation and our Compensation Committee approves the compensation for other executive officers in consultation with our CEO. Our Compensation Committee is also responsible for making recommendations to the Board with respect to the adoption of equity plans and certain other benefit plans. The Compensation Committee and the independent directors meet in executive sessions when determining executive compensation. The Compensation Committee may delegate authority whenever it deems appropriate. In 2023, the Compensation Committee delegated authority to grant equity awards for non-executives to the CEO, subject to certain conditions, including amounts of awards and review of awards by the Compensation Committee. Our Compensation Committee’s policy is to set executive pay in accordance with the objectives of the Company’s compensation programs as described above. In the Compensation Committee’s view, the Company’s executive compensation program provides an overall level of compensation opportunity that is competitive with peer companies. Actual compensation levels may be greater or less than target compensation levels provided by similar companies based upon annual and long-term Company performance, as well as individual performance, contributions, skills, seniority, knowledge, experience and responsibilities.

  47. Role of Independent Consultant

    Role of Independent Consultant The Compensation Committee engaged Aon, an independent compensation consultant, to conduct a comprehensive review and analysis of our executive and non-employee director compensation programs and to make recommendations for compensation related to 2023. The consultation included non-executive compensation data and valuation services for equity incentives. Aon does not perform any other work for the Company. The Compensation Committee reviewed the independence of Aon in light of SEC rules and Nasdaq listing standards regarding compensation consultants. Based on such review, the Compensation Committee determined that there were no actual or potential conflicts of interest with Aon in 2023.

  48. Pay Positioning Strategy and Peer Group

    Pay Positioning Strategy and Peer Group Consistent with prior years, in 2023 the Compensation Committee used competitive compensation data from the annual total compensation study of peer companies to inform its decisions about overall compensation opportunities and specific compensation elements. In late 2022, Aon performed an analysis of similarly-situated public companies and supplemented the peer group with broader, size-appropriate comparisons in the high technology industry using Aon/Radford survey data. The Committee does not benchmark specific compensation elements or total compensation to any specific percentile relative to the peer companies or the broader United States market. Instead, the Committee applies judgment and discretion in establishing targeted pay levels, taking into account not only competitive market data, but also factors such as Company, business and individual performance, scope of responsibility, critical needs and skill sets, leadership potential, length of tenure and succession planning. No single factor takes precedence over any other, nor is any formula used in making these decisions. The Compensation Committee reviews this peer group annually with input from its independent compensation consultant to ensure that the comparisons are meaningful. In this review, the Compensation Committee considers several factors: it considers the current peer group to determine appropriateness, the peers used by institutional governance advisors, the companies that list our Company as a peer to understand crossover peers and broader research based upon established selection criteria to identify potential future peers. The Committee then develops criteria for business sector, including but not limited to revenue, operating income and market capitalization. Based upon the process and applying the criteria above, the Compensation Committee, with input from Aon, approved adding Advanced Energy Industries, Inc., Albany International Corp., FormFactor, Inc., Kadant Inc. and Onto Innovation Inc. and removing Coherent, Inc. because it was acquired in 2022, as well as Entegris, Inc., Teradyne, Inc., Trimble Navigation Limited, and Waters Corporation. The Compensation Committee approved the proposed changes to the peer group for 2023 compensation determinations. For 2023, the peer companies were:

  49. Pay Positioning Strategy and Peer Group

    | Advanced Energy Industries, Inc. | Albany International Corp. | Barnes Group, Inc. | | Cognex Corporation | Coherent Corp. | Dolby Laboratories, Inc. | | Donaldson Company, Inc. | FormFactor, Inc. | Graco, Inc. | | IDEX Corporation | ITT, Inc. | Kadant Inc. | | Littlefuse, Inc. | Lumentum Holdings Inc. | MKS Instruments, Inc. | | National Instruments, Inc. | Nordson Corporation | Novanta, Inc. | | Onto Innovation Inc. | Watts Water Technologies, Inc. | |

  50. Pay Positioning Strategy and Peer Group

    The peer companies selected by the Compensation Committee are companies that operate in the semiconductor equipment and electronic manufacturing industries, and are comparable in terms of revenue, net income, and market capitalization.

  51. COMPANY VS. PEER GROUP

    COMPANY VS. PEER GROUP

  52. Compensation Risk

    Compensation Risk Management conducts an annual risk assessment of the Company’s compensation policies and practices for all employees, including non-executives, and reports its findings to the Compensation Committee. In 2023, management concluded that the Company’s compensation policies and practices are balanced and do not motivate imprudent risk taking. Management believes that the Company's compensation policies do not create risks that are reasonably likely to have a material adverse effect on the Company. In reaching this conclusion, they considered the following factors: •our compensation program is designed to provide a mix of both fixed and variable incentive compensation; •our senior executives are subject to stock ownership guidelines, which we believe incentivize our executives to consider the long-term interests of the Company and our stockholders and discourage excessive risk-taking that could negatively impact our stock price; •our senior executives are subject to compensation recovery policy, which discourages excessive risk-taking that could negatively affect our stock price; •our incentive compensation programs are designed with vesting terms that are relatively consistent, spread out over several years, and do not contain steep payout “cliffs” that might encourage short-term business decisions in order to meet a vesting or payout threshold; and •our senior executive incentive compensation program caps the amounts that may be paid for performance above target level.

  53. Other Policies

    Other Policies Anti-Hedging and Anti-Pledging. The Board adopted policies prohibiting hedging transactions and the pledging of our common stock. Under our insider trading policy, no director or employee may engage in shorting shares of our common stock or any type of securities that we may issue, or buying or selling puts, calls or derivatives related to our common stock. Additionally, directors and officers of the Company may not pledge any Company shares. The Board amended our policy in 2023 to prohibit all pledging, a change from the prior policy which allowed directors and officers to pledge up to 20% of such person's total stock ownership subjected to certain conditions. Executive Officer Stock Ownership Guidelines. The Board adopted stock ownership guidelines to closely align the interests of our executives with those of our long-term stockholders. Generally, the CEO must hold five times his annual salary in Company equity, and senior executive officers must hold at least two times their respective annual salaries in Company equity. Unvested RSUs subject solely to time-based vesting count toward required stock ownership levels; stock options (whether vested or unvested) and unvested PSUs do not. Indirect ownership of shares through a separate legal entity counts toward fulfillment of the ownership guidelines. Ownership requirements are to be achieved no later than four years after being appointed as an executive officer, except that prior to such time the officer is expected to retain a certain portion of stock issued upon exercise of stock options or vesting of RSUs and PSUs until the minimum ownership levels are attained. As of December 31, 2023, each of our NEOs exceeded their respective ownership requirements. Clawback Policies. In July 2023, the Compensation Committee approved a new clawback policy, effective July 28, 2023. The Incentive Based Compensation Recoupment Policy (the "Required Clawback Policy”) complies with the SEC’s newly adopted clawback rules as required under the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd Frank Act”), and provides that in the event we are required to prepare a “financial restatement” (as defined in the Required Clawback Policy), we shall, subject to certain limited exceptions as described in the Required Clawback Policy, recover certain incentive based compensation from “covered persons” (i.e., current and former “executive officers”, defined to include any president/CEO, principal financial officer, principal accounting officer (or if there is no such accounting officer, the controller), any vice president in charge of a principal business unit, division or function, or any officer or person who performs a policy making functions who served during the performance period applicable to “incentive based compensation” and received “incentive based compensation” after beginning service in any such role). Compensation that shall be recovered under the Required Clawback Policy includes “incentive based compensation” received during the three-year period prior to the “restatement date” (as defined in the Required Clawback Policy) that exceeds the amount that otherwise would have been received by the “covered person” had such compensation been determined based on the restated amounts in the financial restatement. Under the Required Clawback Policy, “incentive based compensation” includes any cash or equity compensation that is granted, earned, or vested based, in whole or in part, upon the attainment of a financial reporting measure. The Required Clawback Policy applies to "incentive based compensation” received by a “covered person” on or after October 2, 2023. The Board had previously adopted a compensation recovery policy in 2015 that allows the Company to recapture cash and equity performance-based compensation from executives if the amount of the award was based upon achieving certain financial results that were later restated due to the participant’s misconduct. This policy remains in effect and would apply to compensation received prior to October 2, 2023 that is not covered by the Required Clawback Policy. In addition, all equity awarded to employees since 2007 contain a provision under which employees may be required to forfeit equity awards or profit from equity awards if they engage in certain conduct, including competing against the Company, disclosing confidential information, or soliciting its employees or customers.

  54. Summary Compensation Table

    Summary Compensation Table The following table provides information regarding the total compensation of each NEO for 2023, 2022 and 2021, except in the case of Mr. Ness, who was not a NEO in 2022 or 2021.

  55. Summary Compensation Table

    | Name and Principal Position | Year | Salary ($) | Stock Awards ($)(1) | Non-Equity Incentive Plan Compensation ($)(2) | All Other Compensation ($)(3) | Total ($) | | Eugene Scherbakov Chief Executive Officer(4)(5) | 2023 | 864,890 | 4,416,887 | 166,491 | 277,284 | 5,725,552 | | | 2022 | 785,174 | 4,999,721 | 540,200 | 310,425 | 6,635,520 | | | 2021 | 803,200 | 4,406,457 | 1,919,896 | 155,298 | 7,284,851 | | Timothy Mammen Chief Financial Officer and Senior Vice President | 2023 | 538,700 | 1,616,014 | 102,353 | 11,832 | 2,268,899 | | | 2022 | 520,500 | 1,561,276 | 270,900 | 11,082 | 2,363,758 | | | 2021 | 505,300 | 1,534,952 | 909,600 | 10,632 | 2,960,484 | | Angelo Lopresti Senior Vice President, General Counsel and Secretary | 2023 | 485,500 | 1,334,917 | 92,245 | 15,444 | 1,928,106 | | | 2022 | 469,100 | 1,289,844 | 244,100 | 12,762 | 2,015,806 | | | 2021 | 455,400 | 1,267,921 | 819,700 | 12,312 | 2,555,333 | | Trevor Ness Senior Vice President, Sales and Strategic Business Development | 2023 | 477,100 | 1,311,831 | 90,649 | 11,832 | 1,891,412 | | Alexander Ovtchinnikov Senior Vice President, Chief Technology Officer | 2023 | 481,000 | 1,322,718 | 91,390 | 15,444 | 1,910,552 | | | 2022 | 464,700 | 1,277,805 | 241,800 | 14,694 | 1,998,999 | | | 2021 | 451,200 | 1,256,284 | 812,100 | 14,244 | 2,533,828 |

  56. Summary Compensation Table

    (1)Since 2020, the Company has granted PSUs and service-based RSUs, which are reflected in the Stock Awards column. The value of the PSUs is based on the probable outcome of the performance conditions (at the grant date), calculated in accordance with ASC Topic 718 disregarding forfeitures related to service-based vesting. For PSUs granted in 2023, the values of the award at the grant date assuming the highest level of performance conditions will be achieved are $4,416,756, $1,616,014, $1,334,786, $1,311,700, and $1,322,718 for Dr. Scherbakov, Messrs. Mammen, Lopresti and Ness, and Dr. Ovtchinnikov, respectively. There is no assurance that any of the performance targets will be achieved, that the service-based awards will vest or that the any of the recipients will realize the values listed above. (2)Represents amounts earned under our AIP for services rendered in 2023, 2022 and 2021, respectively. (3)The amount reported for 2023 for Dr. Scherbakov consists of U.S. housing allowance ($133,263), the expense of automobiles in Germany ($25,419) and the United States ($14,776), U.S. tax preparation fees ($3,000), dental insurance ($1,339) and $99,487 in tax gross-up associated with the foregoing U.S.-based benefits. Dr. Scherbakov maintains his principal residence in Germany at his sole cost. The Company pays for his U.S.-based living expenses and taxes thereon. (4)Dr. Scherbakov was Chief Operating Officer, Managing Director of IPG Laser GmbH, and Senior Vice President, Europe prior to his appointment as CEO on May 4, 2021. (5)A portion of the amounts paid to Dr. Scherbakov were denominated in Euros. Dr. Scherbakov’s salary as Chief Operating Officer for 2021 and as Chief Executive Officer in 2023, 2022 and 2021 was approved in Euro. Amounts paid in Euros were translated into U.S. dollars at the average daily exchange rates for the full years. The average daily rates in 2023, 2022 and 2021 for the Euro were 0.92, 0.95 and 0.85, respectively. As a result of compensation being paid in a currency that fluctuates against the U.S. dollar, the amount of salary paid may vary slightly from the salary stated in an employment agreement or approved by the Compensation Committee.

  57. 2023 Grants of Plan-Based Awards

    2023 Grants of Plan-Based Awards

  58. 2023 Grants of Plan-Based Awards

    | Name | Grant Date | Estimated Possible Payouts Under Non-Equity Incentive Plan Awards ($)(1)(2) | | | Estimated Future Payouts Under Equity Incentive Plan Awards (#)(3) | | | All Other Stock Awards: Number of Shares of Stock or Units (#)(4) | Grant Date Fair Value of Stock and Option Awards ($)(5) | | | | Threshold | Target | Maximum | Threshold | Target | Maximum | | | | Eugene Scherbakov | 2/17/2023 | 465,310 | 951,378 | 2,140,600 | — | — | — | — | — | | | 2/17/2023 | — | — | — | 8,418 | 16,836 | 33,672 | — | 2,208,378 | | | 2/17/2023 | — | — | — | — | — | — | 16,837 | 2,208,509 | | Timothy Mammen | 2/17/2023 | 188,545 | 430,960 | 969,660 | — | — | — | — | — | | | 2/17/2023 | — | — | — | 3,080 | 6,160 | 12,320 | — | 808,007 | | | 2/17/2023 | — | — | — | — | — | — | 6,160 | 808,007 | | Angelo Lopresti | 2/17/2023 | 169,925 | 388,400 | 873,900 | — | — | — | — | — | | | 2/17/2023 | — | — | — | 2,554 | 5,088 | 10,176 | — | 667,393 | | | 2/17/2023 | — | — | — | — | — | — | 5,089 | 667,524 | | Trevor Ness | 2/17/2023 | 166,985 | 381,680 | 858,780 | — | — | — | — | — | | | 2/17/2023 | — | — | — | 2,500 | 5,000 | 10,000 | — | 655,850 | | | 2/17/2023 | — | — | — | — | — | — | 5,011 | 655,981 | | Alexander Ovtchinnikov | 2/17/2023 | 168,385 | 384,880 | 865,980 | — | — | — | — | — | | | 2/17/2023 | — | — | — | 2,521 | 5,042 | 10,084 | — | 661,359 | | | 2/17/2023 | — | — | — | — | — | — | 5,042 | 661,359 |

  59. 2023 Grants of Plan-Based Awards

    (1)Amounts shown include possible payouts under the AIP for 2023 financial performance at threshold, target and maximum levels plus individual performance at the maximum level for each. The performance measures used in determining AIP payments are discussed in Compensation Discussion and Analysis—Annual Incentives above. Actual amounts paid for 2023 performance are shown in the “Non-Equity Incentive Plan Compensation” column in the Summary Compensation Table above. (2)Dr. Scherbakov’s salary as Chief Executive Officer for 2023 was approved in Euro. The amounts included as possible payouts under the AIP for 2023 financial performance at threshold, target and maximum levels plus individual performance at the maximum level for Dr. Scherbakov were translated into U.S. Dollars at the average daily exchange rate for 2023. (3)For a description of the PSUs, see Compensation Discussion and Analysis–Long-Term Incentives above. (4)The amounts reported reflect service-based RSUs granted under our 2006 Incentive Compensation Plan, which vest in three annual installments commencing on March 1, 2024. (5)Valuation based on the fair value of such awards as of the grant date determined pursuant to ASC Topic 718. The assumptions that we used with respect to the valuation of equity awards are set forth in Note 15 to our Consolidated Financial Statements in our Annual Report. Regardless of the value placed on an equity award on the grant date, the actual value of the equity award will depend on the market value of our common stock when such equity award vests, and, with respect to PSUs, on the Company's performance relative to the applicable performance metrics under such PSUs, as described above under Compensation Discussion and Analysis-Long Term Incentives. For PSUs granted in 2023, the maximum number of PSUs that can be earned is two times the target number of PSUs and the values of the award at the grant date assuming the highest level of performance conditions will be achieved are $4,416,756, $1,616,014, $1,334,786, $1,311,700, and $1,322,718 for Dr. Scherbakov, Messrs. Mammen, Lopresti and Ness, and Dr. Ovtchinnikov, respectively.

  60. 2023 Outstanding Equity Awards at Fiscal Year-End

    2023 Outstanding Equity Awards at Fiscal Year-End

  61. 2023 Outstanding Equity Awards at Fiscal Year-End

    | | | Option Awards(1) | | | | Stock Awards(1) | | | | | Name | Grant Date | Securities Underlying Unexercised Options (#) Exercisable | Securities Underlying Unexercised Options (#) Unexercisable | Option Exercise Price ($)(2) | Option Expiration Date | Number of Shares or Units of Stock That Have Not Vested (#) | Market Value of Shares or Units of Stock That Have Not Vested ($)(3) | Equity incentive plan awards: Number of unearned shares, units or other rights that have not vested (#)(1)(4) | Equity incentive plan awards: Market or payout value of unearned shares, units or other rights that have not vested ($)(4) | | Eugene Scherbakov | 2/28/2014 | 13,000 | — | 71.77 | 2/28/2024 | — | — | — | — | | | 2/25/2015 | 7,326 | — | 97.65 | 2/25/2025 | — | — | — | — | | | 2/18/2016 | 7,592 | — | 81.89 | 2/18/2026 | — | — | — | — | | | 2/17/2017 | 10,367 | — | 119.50 | 2/17/2027 | — | — | — | — | | | 2/22/2018 | 13,744 | — | 239.72 | 2/22/2028 | — | — | — | — | | | 2/15/2019 | 17,908 | — | 154.88 | 2/15/2029 | — | — | — | — | | | 2/19/2020 | — | — | — | | 2,035 | 220,879 | — | — | | | 2/19/2021 | — | — | — | | 2,619 | 284,266 | 1,735 | 188,317 | | | 5/7/2021 | — | — | — | | 2,534 | 275,040 | 1,680 | 182,347 | | | 2/18/2022 | — | — | — | | 12,182 | 1,322,234 | 14,617 | 1,586,529 | | | 2/17/2023 | — | — | — | | 16,837 | 1,827,488 | 16,836 | 1,827,379 | | Timothy Mammen | 2/22/2018 | 6,642 | — | 239.72 | 2/22/2028 | — | — | — | — | | | 2/15/2019 | 8,654 | — | 154.88 | 2/15/2029 | — | — | — | — | | | 2/19/2020 | — | — | — | | 1,254 | 136,109 | — | — | | | 2/19/2021 | — | — | — | | 1,616 | 175,401 | 1,070 | 116,138 | | | 2/18/2022 | — | — | — | | 3,804 | 412,886 | 4,564 | 495,377 | | | 2/17/2023 | — | — | — | | 6,160 | 668,606 | 6,160 | 668,606 | | Angelo Lopresti | 2/25/2015 | 5,661 | — | 97.65 | 2/25/2025 | — | — | — | — | | | 2/18/2016 | 5,861 | — | 81.89 | 2/18/2026 | — | — | — | — | | | 2/17/2017 | 7,184 | — | 119.50 | 2/17/2027 | — | — | — | — | | | 2/22/2018 | 5,786 | — | 239.72 | 2/22/2028 | — | — | — | — | | | 2/15/2019 | 7,540 | — | 154.88 | 2/15/2029 | — | — | — | — | | | 2/19/2020 | — | — | — | | 1,056 | 114,618 | — | — | | | 2/19/2021 | — | — | — | | 1,335 | 144,901 | 884 | 95,949 | | | 2/28/2022 | — | — | — | | 3,143 | 341,141 | 3,771 | 409,304 | | | 2/17/2023 | — | — | — | | 5,089 | 552,360 | 5,088 | 552,252 |

  62. 2023 Outstanding Equity Awards at Fiscal Year-End

    | | | Option Awards(1) | | | | Stock Awards(1) | | | | | Name | Grant Date | Securities Underlying Unexercised Options (#) Exercisable | Securities Underlying Unexercised Options (#) Unexercisable | Option Exercise Price ($)(2) | Option Expiration Date | Number of Shares or Units of Stock That Have Not Vested (#) | Market Value of Shares or Units of Stock That Have Not Vested ($)(3) | Equity incentive plan awards: Number of unearned shares, units or other rights that have not vested (#)(1)(4) | Equity incentive plan awards: Market or payout value of unearned shares, units or other rights that have not vested ($)(4) | | Trevor Ness | 2/22/2018 | 5,689 | — | 239.72 | 2/22/2028 | — | — | — | — | | | 2/15/2019 | 6,212 | — | 154.88 | 2/15/2029 | — | — | — | — | | | 2/19/2020 | — | — | — | | 1,038 | 112,665 | — | — | | | 2/19/2021 | — | — | — | | 1,312 | 142,404 | 869 | 94,321 | | | 2/18/2022 | — | — | — | | 3,089 | 335,280 | 3,705 | 402,141 | | | 2/17/2023 | — | — | — | | 5,001 | 542,809 | 5,000 | 542,700 | | Alexander Ovtchinnikov | 2/17/2017 | 7,119 | — | 119.50 | 2/17/2027 | — | — | — | — | | | 2/22/2018 | 5,734 | — | 239.72 | 2/22/2028 | — | — | — | — | | | 2/15/2019 | 7,472 | — | 154.88 | 2/15/2029 | — | — | — | — | | | 2/19/2020 | — | — | — | | 1,046 | 113,533 | — | — | | | 2/19/2021 | — | — | — | | 1,322 | 143,490 | 876 | 95,081 | | | 2/18/2022 | — | — | — | | 3,114 | 337,994 | 3,736 | 405,505 | | | 2/17/2023 | — | — | — | | 5,042 | 547,259 | 5,042 | 547,259 |

  63. 2023 Outstanding Equity Awards at Fiscal Year-End

    (1)The vesting dates assume the continued service of the NEO through the applicable vesting date. Service-based RSUs granted prior to 2022 vest in four annual installments commencing on March 1 of the year following the grant. Service-based RSUs granted in 2022 and 2023 vest in three annual installments commencing on March 1 of the year following the grant. PSUs granted in 2023, 2022 and 2021 vest in one installment on March 1 of 2026, 2025 and 2024, respectively. However, the RSUs granted on May 7, 2021 to Dr. Scherbakov vest in four annual installments commencing on May 7, 2022 and PSUs granted on May 7, 2021 to Dr. Scherbakov vest in one installment on May 7, 2024. (2)Represents the closing price of a share of our common stock on the grant date. (3)Based upon the closing common stock price on December 29, 2023, the last trading day of 2023, which was $108.54 per share. (4)The PSU performance measurement periods end March 1, 2026, 2025 and 2024 for PSUs granted in 2023, 2022, and 2021, respectively. The number of shares that can be earned ranges from 0% to 200% of the target number of PSUs based upon achievement of pre-determined performance metrics and the amounts presented above assume attainment of the maximum performance levels (200%) not limited by dollar value caps. PSUs have dollar payout caps of 600% of the value of the target award on the date of grant. See "2023 Compensation of Named Executive Officers—Long-Term Incentives—Actual Performance of Performance-Based Stock Units" for more information on the vesting of PSUs granted in March 2020 and 2021.

  64. Option Exercises and Stock Vested in 2023

    Option Exercises and Stock Vested in 2023 The following table provides information on NEO stock option exercises and vesting of RSUs and PSUs during 2023. PSUs granted in 2020 were eligible to vest in March 2023. IPG performance fell below threshold for TSR PSUs, resulting in no shares paid out for such awards. For PSUs based on the ratio of operating cash flow to adjusted net income, IPG performance resulted in a distribution of common stock at 73.8% of target.

  65. Option Exercises and Stock Vested in 2023

    | | Option Awards | | Stock Awards | | | Name | Number of Shares Acquired on Exercise (#) | Value Realized on Exercise ($)(1) | Number of Shares Acquired on Vesting (#) | Value Realized on Vesting ($)(2) | | Eugene Scherbakov | 3,000 | 179,670 | 15,257 | 1,893,435 | | Timothy Mammen | — | — | 6,564 | 818,137 | | Angelo Lopresti | — | — | 5,505 | 686,143 | | Trevor Ness | — | — | 5,412 | 674,552 | | Alexander Ovtchinnikov | — | — | 5,454 | 679,787 |

  66. Option Exercises and Stock Vested in 2023

    (1)The value realized is based on the difference between the reported closing common stock price on the date of exercise and the exercise price of the stock option; dollar amount represents pre-tax value received on exercise. (2)The value realized is based on the closing common stock prices on the vesting dates of service-based RSUs and PSUs; dollar amount represents pre-tax value received on vesting.

  67. Potential Payments upon Termination or Change in Control

    Potential Payments upon Termination or Change in Control The following table provides information regarding compensation and benefits that would be payable to our NEOs as of December 31, 2023, upon an Involuntary Termination absent a change in control and within twenty-four months following a change in control and upon terminations in other circumstances. The incentive plan severance was calculated using the actual amount awarded under the 2023 AIP. There can be no assurance that the event triggering payments would produce the same or similar results as those described below if such event occurs on any other date or at any other price, or if any other assumption used to estimate the potential payments and benefits is changed. Any actual payments and benefits may be different due to a number of factors that affect the nature and amount of any potential payments or benefits.

  68. Potential Payments upon Termination or Change in Control

    | Name | Benefit | Termination Without Cause or For Good Reason ($) | Termination Without Cause or For Good Reason Following a Change in Control ($)(1) | Termination upon Death ($) | Termination following Disability ($) | Termination following Non- Renewal ($) | | Eugene Scherbakov | Salary Severance and Benefits Continuation | 1,741,815 | 1,741,815 | — | — | 876,925 | | | Incentive Plan Severance | 166,491 | 2,188,958 | 166,491 | 166,491 | 166,491 | | | Equity Acceleration | 2,141,476 | 8,858,926 | 8,858,926 | 5,081,011 | — | | | Total | 4,049,782 | 12,789,699 | 9,025,417 | 5,247,502 | 1,043,416 | | Timothy Mammen | Salary Severance and Benefits Continuation | 853,294 | 1,137,726 | — | — | 568,863 | | | Incentive Plan Severance | 102,353 | 1,139,953 | 102,353 | 102,353 | 102,353 | | | Equity Acceleration | 769,259 | 3,031,522 | 3,031,522 | 1,717,248 | — | | | Total | 1,724,906 | 5,309,201 | 3,133,875 | 1,819,601 | 671,216 | | Angelo Lopresti | Salary Severance and Benefits Continuation | 728,250 | 971,000 | — | — | 485,500 | | | Incentive Plan Severance | 92,245 | 1,016,912 | 92,245 | 92,245 | 92,245 | | | Equity Acceleration | 637,709 | 2,506,514 | 2,506,514 | 1,418,690 | — | | | Total | 1,458,204 | 4,494,426 | 2,598,759 | 1,510,935 | 577,745 | | Trevor Ness | Salary Severance and Benefits Continuation | 760,894 | 1,014,526 | — | — | 507,263 | | | Incentive Plan Severance | 90,649 | 1,014,116 | 90,649 | 90,649 | 90,649 | | | Equity Acceleration | 626,764 | 2,467,548 | 2,467,548 | 1,394,160 | — | | | Total | 1,478,307 | 4,496,190 | 2,558,197 | 1,484,809 | 597,912 | | Alexander Ovtchinnikov | Salary Severance and Benefits Continuation | 748,344 | 997,791 | — | — | 498,896 | | | Incentive Plan Severance | 91,390 | 1,007,523 | 91,390 | 91,390 | 91,390 | | | Equity Acceleration | 631,775 | 2,483,395 | 2,483,395 | 1,405,593 | — | | | Total | 1,471,509 | 4,488,709 | 2,574,785 | 1,496,983 | 590,286 |

  69. Potential Payments upon Termination or Change in Control

    (1)Equity acceleration is calculated at the full value of service-based RSUs. For PSUs tied to performance period ending on December 31, 2023, the actual number of PSUs earned was used in the calculation; for PSUs tied to performance beyond 2023, the target number of PSUs was used in the calculations.

  70. Potential Payments upon Termination or Change in Control

    | Proposal 3 | Ratify Deloitte & Touche LLP as Our Independent Registered Public Accounting Firm for 2024 |

  71. Potential Payments upon Termination or Change in Control

    Deloitte & Touche LLP currently serves as our independent registered public accounting firm and audited our consolidated financial statements for the year ended December 31, 2023. Our Audit Committee has appointed Deloitte & Touche LLP to serve as our independent registered public accounting firm for 2024, and to conduct an integrated audit of our consolidated financial statements for the year ending December 31, 2024 and of our internal control over financial reporting as of December 31, 2024. Deloitte & Touche LLP has served as the Company’s auditor since 1999. A representative of Deloitte & Touche LLP will attend the Annual Meeting where he or she will have the opportunity to make a statement, if he or she desires, and will be available to respond to appropriate stockholder questions. The Audit Committee is solely responsible for the appointment, retention, termination and oversight of the work of our independent registered public accounting firm, including the approval of all engagement fees, terms, and the annual audit plan. In determining whether to reappoint Deloitte & Touche LLP as the Company’s independent external auditor, the Audit Committee took into consideration several factors, including an assessment of the professional qualifications and past performance of the lead audit partner and the Deloitte & Touche LLP team and the quality and level of transparency of the Audit Committee’s relationship and communications with Deloitte & Touche LLP. The Audit Committee considered, among other things, the knowledge and skills of Deloitte & Touche LLP’s auditing experts that would be providing services to the Company, international scope and knowledge of the Company and its operations. After its assessment, the Audit Committee concluded that the best course of action was to reappoint Deloitte & Touche LLP as the Company’s independent external auditor for 2024. Lead and concurring audit partners are subject to rotation requirements that limit the number of consecutive years an individual partner may provide services. The maximum number of consecutive years of service in that capacity is five years and 2024 is a year of lead audit partner rotation. The process for rotation of the Company's lead audit partner involves an inquiry into the backgrounds and experiences of several potential lead partners, a narrowing of the list to one or more, a meeting between the candidate or candidates for the role with the Chair of the Audit Committee, as well as with management. This is accompanied by several discussions with and a final approval by the entire Audit Committee. The Audit Committee engaged in this process before approving a new lead audit partner for the 2024 audit. Fees Paid to Deloitte & Touche. The fees for services provided by Deloitte & Touche LLP, member firm of Deloitte Touche Tohmatsu, and their respective affiliates, to the Company were:

  72. Potential Payments upon Termination or Change in Control

    | | Fees | | | Fee Category | 2023 | 2022 | | Audit fees | $2,529,772 | $2,367,800 | | Audit-related fees | — | — | | Tax fees | — | 159,320 | | All other fees | 1,895 | 1,895 | | Total Fees | $2,531,667 | $2,529,015 |

  73. Potential Payments upon Termination or Change in Control

    Audit fees. These fees comprise fees for professional services rendered in connection with the audit of the Company’s consolidated financial statements that are customary under auditing standards generally accepted in the United States. Audit fees also include fees for the audits of statutory financial statements, consents and reviews related to SEC filings and quarterly services with respect to the preparation of our unaudited quarterly financial statements. Audit-related fees. These fees comprise fees for services that are reasonably related to the performance of the audit or review of the Company’s financial statements. Tax fees. Fees for tax services consist of fees for tax compliance services and tax planning and advice services. Tax compliance services are services rendered based upon facts already in existence or transactions that have already occurred to document, compute and obtain government approval for amounts to be included in tax filings. Tax planning and advice are services rendered with respect to proposed transactions or that alter a transaction to obtain a particular tax result.

  74. CEO Pay Ratio

    CEO Pay Ratio As required by Section 953(b) of the Dodd-Frank Wall Street Reform and Consumer Protection Act and Item 402(u) of Regulation S-K, we are providing the following information on the relationship of the annual total compensation of our employees and the annual total compensation of Dr. Eugene Scherbakov, our CEO. Determining our Median Employee: As of December 31, 2023, the measurement date, we employed 6,487 employees, 64% of whom were located outside of the U.S. This includes all full-time, part-time, and temporary employees. It does not include independent contractors. As permitted by applicable SEC rules, in identifying our median employee, we used the "de minimis" exemption to exclude from our employee population 311 workers in the following jurisdictions (employees excluded in parenthesis): Mexico (76), Canada (53), India (50), Korea (44), Turkey (18), United Kingdom (17), Brazil (11), France (9), Czech Republic (9), Spain (7), Thailand (6), Taiwan (5), Malaysia (3), Vietnam (2) and Singapore (1). The SEC rules required us to identify our median employee by use of a consistently applied compensation measure (“CACM”). We chose a CACM that closely approximates the annual total cash compensation of our employees. Specifically, we identified the median employee as of December 31, 2023, by looking at total wages and bonuses paid in 2023. An average 2023 U.S. dollar exchange rate was applied to compensation reported in a foreign currency. After applying our CACM methodology and excluding the employees listed above, we identified the median employee. Calculating the Pay Ratio: As required by the SEC rules, we calculated our median employee’s total annual compensation in accordance with the requirements of Item 402(c)(2)(x) of Regulation S-K (which is the calculation method for reporting total compensation in the Summary Compensation Table). The total compensation of our median employee was $42,185. Our CEO’s total compensation as reported in the Summary Compensation Table for 2023 was $5,725,552. As a result, the estimated ratio of the annual total compensation of our CEO to median employee in 2023 was approximately 136 to 1. The pay ratio included in this information is a reasonable estimate calculated in a manner consistent with rules promulgated by the SEC. The SEC rules for identifying the median compensated employee allow companies to adopt a variety of methodologies, to apply certain exclusions and to make reasonable estimates and assumptions that reflect their employee populations and compensation practices. Accordingly, the pay ratio reported by other companies may not be comparable to the pay ratio reported above, as other companies have different employee populations and compensation practices and may use different methodologies, exclusions, estimates and assumptions in calculating their own pay ratios. This information is being provided solely for compliance with SEC disclosure rules. The Compensation Committee does not consider this ratio when evaluating compensation arrangements. As required by Section 953(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act, and Item 402(v) of Regulation S-K, we are providing the following information about the relationship between executive compensation actually paid (as defined by SEC rules) and certain financial performance of the Company. The Compensation Committee did not consider the pay versus performance disclosure when making its incentive compensation decisions. For further information about how we align executive compensation with the Company’s performance, see “Compensation Discussion and Analysis” on page 34 above. The amounts in the table below are calculated in accordance with SEC rules and do not represent amounts actually earned or realized by NEOs, including with respect to RSUs and PSUs.

  75. CEO Pay Ratio

    | Year | Summary Compensation Table Total ($) | | Compensation Actually Paid ($) | | Average Summary Compensation Table Total for Non-PEO NEOs ($) | Average Compensation Actually Paid to Non-PEO NEOs ($) | Value of Initial Fixed $100 Investment Based On: | | Net Income (MM) | Net Sales (MM) | | | PEO (Eugene Scherbakov) | PEO (Valentin Gapontsev) | PEO (Eugene Scherbakov) | PEO (Valentin Gapontsev) | | | Total Stockholder Return ($) | Peer Group Total Stockholder Return ($) | | | | (a) | (b) | (b) | (c) | (c) | (d) | (e) | (f) | (g) | (h) | (i) | | 2023 | 5,725,552 | — | 4,897,587 | — | 1,999,742 | 1,783,708 | 75 | 151 | 219 | 1,287 | | 2022 | 6,635,520 | — | 1,176,438 | — | 2,093,139 | 178,305 | 65 | 125 | 111 | 1,430 | | 2021 | 7,284,851 | 3,254,034 | 1,633,757 | 3,254,034 | 2,641,365 | 414,607 | 118 | 160 | 278 | 1,461 | | 2020 | — | 1,943,900 | — | 1,943,900 | 2,538,192 | 4,578,077 | 154 | 124 | 160 | 1,201 |

  76. CEO Pay Ratio

    Columns (b). Reflects compensation amounts reported in the “Total” column of the “Summary Compensation Table” for Dr. Eugene Scherbakov and Dr. Valentin Gapontsev, for the respective years shown. Dr. Gapontsev was CEO until May 4, 2021, when Dr. Scherbakov succeeded him as CEO. Columns (c). The dollar amounts reported for Dr. Scherbakov and Dr. Gapontsev under “Compensation Actually Paid” represent the amount of “compensation actually paid” to Dr. Scherbakov and Dr. Gapontsev, as computed in accordance with Item 402(v) of Regulation S-K. The dollar amounts do not reflect the actual amount of compensation earned by or paid to Dr. Scherbakov during the applicable year. Dr. Gapontsev’s “compensation actually paid” is the same as the total from the Summary Compensation Table because Dr. Gapontsev did not receive long-term incentive compensation because of his significant level of common stock ownership, which the independent directors believed provided him with sufficient incentives to act in the best long-term interest of our stockholders during the time he was an executive of the Company. In accordance with the requirements of Item 402(v) of Regulation S-K, the adjustments in the table below were made to Dr. Scherbakov’s total compensation for each year to determine the compensation actually paid:

  77. CEO Pay Ratio

    | | Dr. Scherbakov | | | | | 2023 | 2022 | 2021 | | Total Compensation as reported in Summary Compensation Table ($) | 5,725,552 | 6,635,520 | 7,284,851 | | Less: Fair value of equity awards granted during fiscal year ($) | (4,416,887) | (4,999,721) | (4,406,457) | | Plus: Fair value of equity awards granted in current year—value at end of year-end ($) | 3,289,392 | 3,173,456 | 2,508,547 | | Change in fair value from end of prior fiscal year to vesting date for awards made in prior fiscal years that vested during current fiscal year ($) | 476,128 | (556,517) | 35,664 | | Change in fair value from end of prior fiscal year to end of current fiscal year for awards made in prior fiscal years that were unvested at end of current fiscal year ($) | (176,598) | (3,076,300) | (3,788,848) | | Compensation Actually Paid ($) | 4,897,587 | 1,176,438 | 1,633,757 |

  78. CEO Pay Ratio

    Equity Valuations: Stock option fair values are calculated based on the Black-Scholes option pricing model. Adjustments have been made to generate fair values as of each measurement date using the stock price as of the measurement date and updated assumptions (i.e., term, volatility, dividend yield, risk free rates) as of the measurement date. PSU grant date fair values are calculated using the stock price as of date of grant assuming target performance. Adjustments have been made using the stock price and performance accrual modifier as of year-end and as of the date of vesting. RSU grant date fair values are calculated using the stock price as of date of grant. Adjustments have been made using the stock price as of year-end and as of each date of vesting. Column (d). The dollar amounts reported under Average Summary Compensation Total for non-PEO NEOs represent the average of the amounts reported for the Company’s NEOs as a group (excluding any individual serving as our CEO for such year) in the “Total” column of the Summary Compensation Table in each applicable year. The names of the NEOs included for purposes of calculating the average amounts in each applicable year are as follows: (i) for 2023, Timothy Mammen, Angelo Lopresti, Alexander Ovtchinnikov and Trevor Ness; and (ii) for 2022 and 2021, Timothy Mammen, Angelo Lopresti, Alexander Ovtchinnikov and Felix Stukalin. Column (e). The dollar amounts reported under Average Compensation Actually Paid for non-PEO NEOs represent the average amount of “compensation actually paid” to the NEOs as a group (excluding the CEO), as computed in accordance with Item 402(v) of Regulation S-K. The dollar amounts do not reflect the actual average amount of compensation earned by or paid to the NEOs as a group during the applicable year. In accordance with the requirements of Item 402(v) of Regulation S-K, the adjustments in the table below were made to the NEOs’ average total compensation for each year to determine the compensation actually paid:

  79. CEO Pay Ratio

    | | Non-PEO NEOs | | | | | | 2023 Average | 2022 Average | 2021 Average | 2020 Average | | Total Compensation as reported in Summary Compensation Table ($) | 1,999,742 | 2,093,139 | 2,641,365 | 2,538,192 | | Less: Fair value of equity awards granted during fiscal year ($) | (1,396,370) | (1,353,906) | (1,331,057) | (1,616,786) | | Plus: Fair value of equity awards granted in current year—value at end of year-end ($) | 1,039,922 | 859,360 | 861,825 | 2,603,610 | | Change in fair value from end of prior fiscal year to vesting date for awards made in prior fiscal years that vested during current fiscal year ($) | 180,030 | (219,681) | 20,647 | (404,187) | | Change in fair value from end of prior fiscal year to end of current fiscal year for awards made in prior fiscal years that were unvested at end of current fiscal year ($) | (39,616) | (1,200,607) | (1,778,173) | 1,457,248 | | Compensation Actually Paid ($) | 1,783,708 | 178,305 | 414,607 | 4,578,077 |

  80. CEO Pay Ratio

    Equity Valuations for purposes of this table were calculated in the same manner as described in Columns (c) above. Column (f). For the relevant fiscal year, represents the cumulative total stockholder return (TSR) of the Company for the measurement periods ending on December 31 of each of 2023, 2022, 2021 and 2020, respectively. Column (g). For the relevant fiscal year, represents the cumulative TSR of the S&P 1500 Composite 1500 / Electronic Equipment Instruments & Components Index, a published industry index ("Peer Group TSR") for the measurement periods ending on December 31 of each of 2023, 2022, 2021 and 2020, respectively. Column (h). Reflects “net income” as reported in the Company’s Consolidated Income Statements included in the Company’s Annual Reports on Form 10-K for each of the years ended December 31, 2023, 2022, 2021 and 2020. As disclosed in the Annual Report, 2022 figures include significant inventory related charges, impairment of long-lived assets in Russia and restructuring charges in Russia. Column (i). Company-selected Measure is net sales as reported in the Company’s Consolidated Income Statements included in the Company’s Annual Reports on Form 10-K for each of the years ended December 31, 2023, 2022, 2021 and 2020.

  81. Analysis of the Information Presented in the Pay versus Performance Table

    Analysis of the Information Presented in the Pay versus Performance Table While we utilize several performance measures to align executive compensation with performance, all of those measures are not presented in the Pay Versus Performance table. Moreover, the Company generally seeks to incentivize long-term performance, and therefore does not specifically align the Company’s performance measures with compensation that is actually paid (as defined by SEC rules) for a particular year. In accordance with Item 402(v) of Regulation S-K, we are providing the following graphic descriptions of the relationships of “compensation actually paid” to our PEO(s) and other NEOs in 2020, 2021, 2022 and 2023 to (1) TSR of both the Company and the Peer Group TSR, (2) the Company’s net income and (3) the Company’s net sales. As noted above, Dr. Gapontsev (our sole PEO for 2020) did not receive long-term incentive compensation because of his significant level of common stock ownership which the independent directors believed provided him with sufficient incentives to act in the best long-term interest of our stockholders during the time he was an executive of the Company. Stockholders should consider this when evaluating the compensation actually paid to Dr. Gapontsev in 2020 and 2021. All information provided above under the “Pay Versus Performance” heading will not be deemed to be incorporated by reference into any filing of the Company under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, whether made before or after the date hereof and irrespective of any general incorporation language in any such filing, except to the extent the Company specifically incorporates such information by reference.

  82. Analysis of the Information Presented in the Pay versus Performance Table

    | Questions and Answers About the Meeting and Voting |

  83. What Happens if a Director Nominee Fails to Receive a Majority Vote in an Uncontested Election at the Annual Meeting?

    What Happens if a Director Nominee Fails to Receive a Majority Vote in an Uncontested Election at the Annual Meeting? If a nominee who currently is serving as a director does not receive the affirmative vote of at least a majority of the votes cast in an uncontested election, Delaware law provides that the director would continue to serve on the Board as a “holdover director.” However, under our bylaws, each incumbent director is required to submit a letter of resignation as a condition of becoming a nominee of the Board, with the resignation contingent upon not receiving a majority of the votes cast in an uncontested election and acceptance of the resignation by the Board. In such event, the NCGC (or another committee designated by the Board) would make a recommendation to the Board as to whether to accept or reject the tendered resignation, or whether other action should be taken. The Board would act on the tendered resignation, taking into account the committee’s recommendation, and would publicly disclose its decision regarding the resignation within 90 days after the results of the election are certified. If the resignation is not accepted, the director would continue to serve until the next annual meeting of stockholders and until the director’s successor is elected and qualified.