DEF 14A of MKS Inc, Mar 27, 2024

DEF 14A of MKS Inc

Filed Mar 27, 2024 · FY20230001193125-24-078875

Open on EDGAR

  1. TO BE HELD ON TUESDAY, MAY 7, 2024 at 10:00 A.M. EASTERN TIME

    | Pay Versus Performance | 55 | | Grants of Plan-Based Awards in Fiscal Year 2023 Table | 59 | | Outstanding Equity Awards at 2023 Fiscal Year-End Table | 60 | | Option Exercises and Stock Vested in Fiscal Year 2023 Table | 60 | | Potential Payments Upon Termination or Change-in-Control | 61 | | EQUITY COMPENSATION PLAN INFORMATION | 68 | | OTHER MATTERS | 69 | | Expenses and Solicitation | 69 | | Deadline for Submission of Shareholder Proposals for the 2025 Annual Meeting | 69 | | Householding of Annual Meeting Materials | 69 | | No Incorporation by Reference | 70 | | APPENDIX A | A-1 | | Reconciliation of 2023 Loss from Operations to 2023 Non-GAAP Operating Income | A-1 | | Reconciliation of 2023 Net Loss to 2023 Adjusted EBITDA | A-1 |

  2. PROPOSAL ONE – ELECTION OF DIRECTORS

    PROPOSAL ONE – ELECTION OF DIRECTORS Our By-Laws provide for a Board of Directors that is divided into three classes. The term of the Class I Directors expires at the 2024 Annual Meeting, the term of the Class II Directors expires at the 2025 Annual Meeting of Shareholders, and the term of the Class III Directors expires at the 2026 Annual Meeting of Shareholders. Our Board of Directors, upon the recommendation of our Nominating and Corporate Governance Committee, has nominated Rajeev Batra, Gerald G. Colella, and Elizabeth A. Mora to serve as Class I Directors for a term to expire at the 2027 Annual Meeting of Shareholders. Mr. Batra, Mr. Colella, and Ms. Mora currently serve as directors. Each nominee has consented to being named herein and, if elected, to serve as a director until his or her successor is duly elected and qualified. Shares represented by all proxies received by the Board of Directors and not so marked as to withhold authority to vote for an individual director will be voted (unless one or more nominees are unable or unwilling to serve) for the election of the nominees named below. The Board of Directors expects that each of the nominees named below will be available for election, but if any of them is not a candidate at the time the election occurs, it is intended that such proxies will be voted for the election of a substitute nominee to be designated by the Board of Directors. THE BOARD OF DIRECTORS BELIEVES THAT APPROVAL OF THE ELECTION OF RAJEEV BATRA, GERALD G. COLELLA, AND ELIZABETH A. MORA TO SERVE AS CLASS I DIRECTORS IS IN THE BEST INTERESTS OF MKS AND OUR SHAREHOLDERS AND THEREFORE RECOMMENDS A VOTE “FOR” ALL NOMINEES.

  3. DIRECTORS

    DIRECTORS Set forth below are the names and ages of each member of our Board of Directors (including those who are nominees for election as Class I Directors) and the positions and offices they hold with the Company. In addition, set forth below are biographies for each continuing director and director nominee, which include information about each individual’s specific experience, qualifications, attributes, or skills that led the Board of Directors to conclude that he or she should serve as a director of MKS. Information with respect to the number of shares of Common Stock beneficially owned by each individual, directly or indirectly, as of February 28, 2024, appears in this proxy statement under the heading “Security Ownership of Certain Beneficial Owners and Management.”

  4. DIRECTORS

    | Name | Age | Position | Audit Committee | Compensation Committee | Nominating and Corporate Governance Committee | Class to Which Director Currently Belongs | | Rajeev Batra* | 56 | Director | | | | I | | Peter J. Cannone III | 58 | Director | | | | III | | Gerald G. Colella* | 67 | Chair | | | | I | | Joseph B. Donahue | 65 | Director | | | | III | | John T.C. Lee | 61 | Director, President and CEO | | | | II | | Jacqueline F. Moloney | 70 | Lead Director | | | | II | | Elizabeth A. Mora* | 63 | Director | | | | I | | Michelle M. Warner | 57 | Director | | | | II |

  5. DIRECTORS

    | | Chair |

  6. DIRECTORS

    | | Member |

  7. DIRECTORS

    | * Nominee for election at the 2024 Annual Meeting |

  8. DIRECTORS

    | MKS INSTRUMENTS, INC. | 2024 PROXY STATEMENT | 4 |

  9. DIRECTORS

    | | Rajeev Batra President, Siemens Industry Inc., and Member, Siemens U.S. Managing Board | | Age: 56 Director since: 2018 Independent | Standing Committees: Compensation (Chair); Nominating and Corporate Governance Other Current Public Company Directorships: Shapeways Holdings, Inc. |

  10. DIRECTORS

    | Background | | Mr. Batra has served as the President of Siemens Industry Inc. since 2023 and a member of the Siemens U.S. Managing Board since 2021. As President of Siemens Industry Inc., he serves in a pivotal leadership and advisory role to Siemens’ U.S. entities on driving Digital Transformation initiatives across American industry. Mr. Batra previously held a wide range of high-level management, strategy, and sales positions at Siemens, culminating in his role as President of Siemens Digital Industries U.S., an innovation pioneer in industrial automation and digitalization in the discrete and process industries, from 2019 to 2023. Mr. Batra also served as President of the Digital Factory Division from 2014 to 2019; President of the Industry Automation Division from 2009 to 2014; Vice President and General Manager of the Automation & Motion Division from 2007 to 2009; and Vice President and General Manager of the Automotive & Aerospace Vertical Markets from 2002 to 2007, all for Siemens U.S. In addition to the other current public company directorship listed above, Mr. Batra is a director of Amsted Industries, a private, global manufacturer of industrial components, Chair of the Board of Trustees and Executive Committee of the Manufacturers Alliance, a non-profit manufacturing leadership network, and former Chair and Member of the Board of Governors of the National Electrical Manufacturers Association (NEMA), a trade association of electrical equipment manufacturers. Mr. Batra received a B.S. in Electrical Engineering from Lawrence Technological University and an M.B.A. from the University of Michigan. |

  11. DIRECTORS

    | Key Qualifications as Determined by our Board of Directors | | • Significant management and leadership experience, cultivated over 25+ years in senior roles in broad global industrial markets • Extensive technology background, including in automation, industrial software, digitalization, OT/IT convergence, cybersecurity, and I4.0/IoT • Proven ability to develop and grow product, systems, digital services, and turnkey businesses in the Process and Discrete Markets, and founding Siemens’ Automotive & Aerospace Vertical Markets in the United States |

  12. DIRECTORS

    | MKS INSTRUMENTS, INC. | 2024 PROXY STATEMENT | 5 |

  13. DIRECTORS

    | | Peter J. Cannone III Chairman and CEO, Demand Science | | Age: 58 Director since: 2021 Independent | Standing Committees: Audit |

  14. DIRECTORS

    | Background | | Since 2020, Mr. Cannone has served as Chairman and Chief Executive Officer of Demand Science Group, LLC, a leading global revenue intelligence platform delivering a comprehensive suite of business-to-business solutions, capping a long career as a senior executive for large and mid-market public and private technology companies in both growth and turnaround modes. His previous experience includes serving as General Partner of Optum Ventures, a healthcare-focused venture capital firm, from 2019 to 2020; Chief Executive Officer of UpCurve, Inc., a management company, where he oversaw portfolio firms that provided critical digital, cloud, financial and healthcare solutions to small and midsize businesses, from 2018 to 2019; Chief Executive Officer of ThriveHive, a provider of digital marketing services and one of UpCurve’s portfolio firms, from 2015 to 2019; President and Chief Executive Officer of OnForce, a leading vendor of SaaS technology-enabled workforce solutions, from 2007 to 2014; and a member of senior management at PC Connection, Inc. and MicroWarehouse from 1997 to 2006. Mr. Cannone holds a B.A. in Economics from the University of Massachusetts, Amherst, and an M.B.A. from Rensselaer Polytechnic Institute. |

  15. DIRECTORS

    | Key Qualifications as Determined by our Board of Directors | | • Proven leader of public and private technology companies with 25+ years of experience in executive and senior management roles • Direct knowledge of and experience in mergers and acquisitions, capital raising, marketing, and financial planning and analysis • Track record of building high-performance teams and developing executives |

  16. DIRECTORS

    | MKS INSTRUMENTS, INC. | 2024 PROXY STATEMENT | 6 |

  17. DIRECTORS

    | | Gerald G. Colella Chair of the Board and Former CEO, MKS Instruments | | Age: 67 Director since: 2014 Independent | Other Current Public Company Directorships: Columbus McKinnon Corporation (Chair of the Board) |

  18. DIRECTORS

    | Background | | After joining MKS in 1983, Mr. Colella progressed from positions in materials planning and logistics to leading our global business and service operations before assuming senior management roles, including Vice President and Chief Business Officer, President and Chief Operating Officer and, ultimately, Chief Executive Officer. As CEO from 2014 until his retirement in 2020, he steered MKS through a period of unprecedented growth, increasing MKS’ revenue from approximately $780 million to over $2 billion. Since 2020, Mr. Colella has served as Chair of our Board of Directors. In addition to the other current public company directorship listed above, Mr. Colella served as a director of GCP Applied Technologies Inc. from 2017 to 2020. Mr. Colella holds a B.A. in Secondary Education from the University of Massachusetts and an M.B.A. from Southern New Hampshire University. |

  19. DIRECTORS

    | Key Qualifications as Determined by our Board of Directors | | • Deep insights into our business, industries and markets as a result of 35+ year career at MKS, culminating as CEO • Direct knowledge of and experience in operations, marketing, business strategy, and growth, organically and through acquisitions • Extensive background in leadership, management, and governance at the most senior levels of a public company |

  20. DIRECTORS

    | MKS INSTRUMENTS, INC. | 2024 PROXY STATEMENT | 7 |

  21. DIRECTORS

    | | Joseph B. Donahue Former EVP and COO, TE Connectivity | | Age: 65 Director since: 2020 Independent | Standing Committees: Audit |

  22. DIRECTORS

    | Background | | Mr. Donahue served as Executive Vice President and Chief Operating Officer of TE Connectivity Ltd. (formerly Tyco Electronics Ltd.), a publicly held manufacturer of connectors, sensors, and minimally invasive surgical assemblies for the automotive, industrial, medical, aerospace, and communications/consumer markets, from 2011 until 2017. In this role, Mr. Donahue was responsible for all aspects of corporate global operations, including supply chain, manufacturing, environment, health and safety, facilities, technology, and lean process improvement. He concurrently served as President of the Network Solutions segment of TE Connectivity from 2012 until the divestiture of that business in 2015. He also served at TE Connectivity as President, Transportation Solutions segment from 2010 through 2012, President of the Global Automotive Division from 2008 through 2009 and Senior Vice President of the same division beginning in 2007. From 2006 to 2007, he was Group Vice President, Wood Coatings Division, for Valspar Corporation, a manufacturer of commercial and industrial coatings. Over the prior 16 years, Mr. Donahue held a variety of senior management roles at TE Connectivity and AMP Incorporated. Mr. Donahue has served as a director of Kraton Corporation, a private, global sustainable producer of specialty polymers and high-value biobased products derived from pine wood pulping co-products, since 2023. Mr. Donahue holds a B.S. in Biological Sciences and an M.S. in Plastics Engineering from the University of Massachusetts Lowell. He also holds an M.S. in Manufacturing Systems Engineering from Lehigh University. |

  23. DIRECTORS

    | Key Qualifications as Determined by our Board of Directors | | • Extensive experience in executive leadership roles for companies serving multiple markets, including industrials • Valuable insights into managing all aspects of global operations and overseeing mergers and acquisitions • Deep understanding of international organizations, having lived and worked in Japan, China, and Germany |

  24. DIRECTORS

    | MKS INSTRUMENTS, INC. | 2024 PROXY STATEMENT | 8 |

  25. DIRECTORS

    | | John T.C. Lee President and CEO, MKS Instruments | | Age: 61 Director since: 2020 | Other Current Public Company Directorships: Cognex Corporation |

  26. DIRECTORS

    | Background | | Dr. Lee has served in progressive leadership roles since joining MKS in 2007, culminating in his appointment as our President and Chief Executive Officer in 2020. He previously served as our President from 2019 to 2020; our President and Chief Operating Officer from 2018 to 2019; our Senior Vice President and Chief Operating Officer from 2016 to 2018; our Senior Vice President of Business Units from 2014 to 2016; our Senior Vice President, Controls, HPS (our integrated process solutions business) and Pressure, Flow, Measurement and Control (PFMC) from 2012 to 2013; our Senior Vice President, Controls and PFMC from 2011 to 2012, and our Group Vice President, Controls and Information Technology products from 2007 to 2011. Prior to MKS, Dr. Lee served in leadership roles at Applied Materials, a global leader providing processing equipment to the semiconductor and display markets, from 2002 to 2007, including Managing Director of Factory Technology and Projects within the Solar Business Group and General Manager of the Cleans Product Group and the Maydan Technology Center. Prior to Applied Materials, Dr. Lee served as Research Director of the Silicon Fabrication Research Department at Lucent Technologies, Inc., a voice, data, and video communications provider, from 1997 to 2002 and as a Member of the Technical Staff in the Plasma Processing Research Group within Bell Labs from 1991 to 1997. In addition to the other current public company directorship listed above, he has served as Chair of the Massachusetts High Technology Council (MHTC) since 2023 and as a member of the Executive Committee of the Board of Directors of MHTC since 2021. He previously served as Vice Chair of MHTC from 2021 to 2023. Dr. Lee holds a B.S. from Princeton University and both an M.S.CEP and a Ph.D. from the Massachusetts Institute of Technology, all in Chemical Engineering. |

  27. DIRECTORS

    | Key Qualifications as Determined by our Board of Directors | | • Deep understanding of our extensive and complex product portfolio, driven by strong technical education and background • Unique leadership perspective from progressive leadership roles at MKS and Applied Materials, one of our largest customers • Direct knowledge of and experience in engineering, operations, mergers and acquisitions, and business development |

  28. DIRECTORS

    | MKS INSTRUMENTS, INC. | 2024 PROXY STATEMENT | 9 |

  29. DIRECTORS

    | | Jacqueline F. Moloney Professor and Chancellor Emerita, the University of Massachusetts Lowell Lead Director | | Age: 70 Director since: 2016 Independent | Standing Committees: Compensation; Nominating and Corporate Governance (Chair) Other Current Public Company Directorships: Enterprise Bancorp, Inc. |

  30. DIRECTORS

    | Background | | Dr. Moloney is a Professor and Chancellor Emerita at the University of Massachusetts Lowell who has been recognized as a national leader in innovation and entrepreneurship in higher education. During a nearly 40-year career at UMass Lowell, a public university with over 17,000 students, Dr. Moloney served as Chancellor from 2015 to 2022, Executive Vice Chancellor from 2007 to 2015, and Dean of Online and Continuing Education from 1994 to 2007, in addition to serving as a Professor since 1986. Dr. Moloney has over 35 years of experience as a leader in non-profit organizations. In recognition of her leadership and business acumen, she and UMass Lowell were recognized in the top 20 of the Boston Globe’s Top 100 Women-Led Businesses for five consecutive years, she was recognized as one of seven prominent “Women Who Mean Business” by the Boston Business Journal, she was selected by the Massachusetts Technology Leadership Council as a finalist for the CEO of the Year award in 2018 and 2019, and she was named Chief Executive HR Champion by the College and University Professional Association for Human Resources in 2018. In addition to the other current public company directorship listed above, Dr. Moloney served as a member of the Board of Directors of the Massachusetts High Technology Council from 2015 to 2022. Dr. Moloney holds a B.S. in Sociology from UMass Lowell, an M.A. in Social Psychology from Goddard College, and an Ed.D. from UMass Lowell. |

  31. DIRECTORS

    | Key Qualifications as Determined by our Board of Directors |

  32. DIRECTORS

    | • Valuable knowledge of and insights into emerging strategic planning and management and business trends • Deep history of working with business and industry, including establishing incubators at UMass Lowell for early-stage companies • Strong leadership and interpersonal skills and business acumen |

  33. DIRECTORS

    | MKS INSTRUMENTS, INC. | 2024 PROXY STATEMENT | 10 |

  34. DIRECTORS

    | | Elizabeth A. Mora Former Chief Administrative Officer of The Charles Stark Draper Laboratory | | Age: 63 Director since: 2012 Independent | Standing Committees: Audit (Chair); Compensation Other Current Public Company Directorships: Everest Consolidator Acquisition Corporation; Inogen, Inc. (Chair of the Board); Limoneira Company; NUBURU, Inc. |

  35. DIRECTORS

    | Background | | Over her 30+ year career, Ms. Mora established herself as a financial and accounting expert and business operations leader, culminating in her role as Chief Administrative Officer of The Charles Stark Draper Laboratory, a non-profit engineering innovation company, from 2016 to 2020. Ms. Mora was previously Chief Financial Officer of Draper Labs; Chief Financial Officer and Vice President for Finance of Harvard University; Associate Vice President, Research Administration and the Director of the Office of Sponsored Research of Harvard University; and a founding member of the National Regulatory Consulting Practice at Coopers & Lybrand (now PricewaterhouseCoopers LLP), where she began her career. In addition to the other current public company directorships listed above, Ms. Mora has served on the Advisory Board of The Association of LGBTQ+ Corporate Directors since 2022 and previously served as a director of GCP Applied Technologies Inc. from 2016 to 2020. Ms. Mora is a Certified Public Accountant and has a B.A. in Political Science from the University of California, Berkeley and an M.B.A. from the Simmons College Graduate School of Management. |

  36. DIRECTORS

    | Key Qualifications as Determined by our Board of Directors | | • Financial and accounting expert who served as the CFO of two major organizations, Draper Labs and Harvard University • Seasoned director with substantial experience navigating a range of public company corporate governance and regulatory issues • Critical insights into cybersecurity matters through prior oversight of IT at Draper Labs, a leader in cybersecurity threat detection |

  37. DIRECTORS

    | MKS INSTRUMENTS, INC. | 2024 PROXY STATEMENT | 11 |

  38. DIRECTORS

    | | Michelle M. Warner Executive Director of CEO Perspectives, Corporate Leadership Center | | Age: 57 Director since: 2019 Independent | Standing Committees: Nominating and Corporate Governance |

  39. DIRECTORS

    | Background | | Ms. Warner has served as Executive Director of CEO Perspectives, a leadership development program for executives of Fortune 500 and select growth companies run by Corporate Leadership Center, NFP, since 2022. She also founded and has served as principal of MMW Advisors, LLC, where she serves as an independent advisor in the areas of M&A execution, team and process development, and board and governance excellence, since 2020. Previously, Ms. Warner served as a senior executive of multinational public companies for over 20 years, most recently as Senior Vice President, General Counsel, and Corporate Secretary for USG Corporation, a leading manufacturer of building products and solutions, from 2016 until its acquisition by privately held Gebr. Knauf KG in 2019, and as Corporate Vice President, Deputy General Counsel, and Corporate Secretary of Motorola Solutions, Inc. (formerly Motorola, Inc.), a provider of communication infrastructure, devices, accessories, software, and services, from 2013 to 2015. She is a member of the President’s Council of the Museum of Science and Industry, Chicago, where she completed a two-year term as Chair and as an ex officio member of the Board of Trustees. In addition, she serves on the Board of Advisors of Denison University. Ms. Warner received a J.D. from the Northwestern University School of Law and a B.S. in Economics from Denison University. |

  40. DIRECTORS

    | Key Qualifications as Determined by our Board of Directors | | • Former General Counsel with deep knowledge of and critical perspectives on securities and corporate governance matters • Unique insights into leading global organizations from role as Executive Director of leadership development program for executives • Significant experience overseeing and executing on major mergers and acquisitions and other complex transactions |

  41. Compensation Committee

    | • | reviewing and making recommendations to the Board of Directors with respect to director compensation; and |

  42. DIRECTOR COMPENSATION

    DIRECTOR COMPENSATION

  43. Director Compensation Table for 2023

    Director Compensation Table for 2023 The following table summarizes compensation earned by or paid to non-employee directors in 2023. Dr. Lee is excluded from the table because he was an executive officer in 2023 and his compensation is set forth in the Executive Compensation section below, under the heading “Executive Compensation Tables — Summary Compensation Table for 2023.”

  44. Director Compensation Table for 2023

    | Name | Fees Earned or Paid in Cash ($) | Stock Awards ($)(1) | All Other Compensation ($) | Total ($) | | Rajeev Batra | $112,500 | $200,000 | — | $312,500 | | Peter J. Cannone III | $115,500(2)(3) | $200,000 | — | $315,500 | | Gerald G. Colella | $193,000(2) | $200,000 | $24,505(4) | $417,505 | | Joseph B. Donahue | $115,500(2)(3) | $200,000 | — | $315,500 | | Jacqueline F. Moloney | $140,000 | $200,000 | — | $340,000 | | Elizabeth A. Mora | $135,000(3) | $200,000 | — | $335,000 | | Michelle M. Warner | $95,500(2) | $200,000 | — | $295,500 | | Geoffrey Wild(5) | $36,833 | $— | — | $36,833 |

  45. Director Compensation Table for 2023

    | (1) Represents the aggregate grant date fair value for each RSU granted during the year, calculated in accordance with Financial Accounting Standards Board Accounting Standards Codification 718, or ASC 718. The |

  46. Director Compensation Table for 2023

    | MKS INSTRUMENTS, INC. | 2024 PROXY STATEMENT | 30 |

  47. Director Compensation Table for 2023

    | assumptions used in determining the grant date fair values of these awards are set forth in Note 18 to our consolidated financial statements, which were included in our Annual Report on Form 10-K that was filed with the SEC on February 27, 2024. The outstanding stock awards held as of December 31, 2023 by each of the non-employee directors consisted of 2,369 RSUs. |

  48. Director Compensation Table for 2023

    | (2) Includes consideration for services on a special committee of the Board of Directors for mergers and acquisitions, which compensation consisted of a flat fee of $3,000 for up to five meetings and $1,000 per meeting thereafter up to a maximum of $10,000. In connection with their service on this special committee, Mr. Colella, Mr. Cannone, Mr. Donahue, and Ms. Warner each received $3,000. |

  49. Director Compensation Table for 2023

    | (3) Includes consideration for services on a special committee of the Board of Directors for cybersecurity, which compensation consisted of a one-time fee of $15,000. Mr. Colella did not receive any consideration for his service on this special committee. |

  50. Director Compensation Table for 2023

    | (4) In connection with his retirement as Chief Executive Officer in January 2020, Mr. Colella receives retiree medical benefits for life for himself and his spouse. In addition, Mr. Colella is reimbursed for certain out-of-pocket health care costs capped at $4,500 annually. The net present value of these benefits was $497,501 as of December 31, 2023 and we paid $24,505 for these benefits in 2023. Mr. Colella receives no other retirement benefits. |

  51. Director Compensation Table for 2023

    | (5) Mr. Wild served as a director until May 2023. |

  52. Compensation Philosophy and Objectives

    | • | motivate and reward the attainment of short-term objectives that drive long-term value; and |

  53. Compensation Philosophy and Objectives

    | • | foster long-term alignment of executive and shareholder interests. |

  54. Compensation Philosophy and Objectives

    We target each of our Named Executed Officers’ various compensation elements, including base salary, annual cash incentive compensation, and long-term equity incentive compensation, to be within a competitive range around median levels (plus or minus 15% of median) for each such respective position in the market. The competitive range is considered alongside other key factors when setting compensation levels, and final values for each of our Named Executive Officers may range from approximately the 25th percentile to approximately the 75th percentile. In considering the compensation of our Named Executive Officers relative to the market, we also qualitatively assess each Named Executive Officer’s overall performance, tenure, and potential contributions to MKS’ ongoing growth. For 2023, the total target compensation for each of Mr. Bagshaw, Mr. Henry, and Mr. Schreiner fell within the competitive range of the median of our peer group; however, the total target compensation for each of Dr. Lee and Ms. Burke fell below the competitive range of the median of our peer group but at or above the 25th percentile. This was due to the Compensation Committee’s decision to refrain from

  55. Compensation Philosophy and Objectives

    | • | foster long-term alignment of executive and shareholder interests; |

  56. Compensation Philosophy and Objectives

    | • | balance the short-term focus on annual cash incentive compensation with creating long-term shareholder value; |

  57. What We Do

    | ✓ | Provide maximum payout caps under incentive plans |

  58. What We Do

    | ✓ | Conduct robust annual reviews and validation of our peer group |

  59. What We Do

    | ✓ | Provide change-in-control benefits only upon a qualified double-trigger termination of employment |

  60. What We Do

    | ✓ | Utilize an independent compensation consultant |

  61. What We Do Not Do

    When the Compensation Committee met in May 2022 to review the peer companies to be used to determine 2023 executive compensation, the Committee considered two sets of peer groups: (i) a “pre-Atotech” peer group if the Atotech Acquisition had not been completed by the time 2023 executive compensation was determined and (ii) a “post-Atotech” peer group if the Atotech Acquisition had been completed by the time 2023 executive compensation was determined. The Compensation Committee considered two sets of peer groups because the Atotech Acquisition would significantly increase our size and expand the industries we serve. In determining the composition of the “post-Atotech” peer group, the Compensation Committee considered whether peer companies had (i) a revenue range relative to our projected 2022 revenue (which was calculated on a combined company basis to include Atotech) between approximately 0.5 to 2.5 times and (ii) a market capitalization range relative to our market capitalization as of March 31, 2022 between approximately 0.3 and 3.0 times. The Compensation Committee also considered secondary factors, including other relevant peer groups, other performance considerations, and whether a company is a competitor for talent. This analysis resulted in the removal of four companies from the peer group we used to determine 2022 executive compensation and the addition of five companies to our “post-Atotech” peer group. As we completed the Atotech Acquisition in August 2022, publicly available compensation data from the following 18 “post-Atotech” peer companies was used in determining executive compensation for 2023:

  62. What We Do Not Do

    In certain instances where robust peer group benchmark data was not available, our Compensation Committee utilized size and industry-appropriate broad survey data from Radford Data & Analytics, a third-party provider of compensation data and analytics.

  63. Elements of Compensation

    Annual Cash Incentive Compensation For 2023, the Compensation Committee modified our annual cash incentive program to improve the alignment between cash bonus payouts and strong operational performance. In 2022, cash bonus payouts under the Management Incentive Plan were based on two performance metrics, (i) non-GAAP operating income after bonus, which excludes any charges or income not related to our operating performance, and (ii) annualized cost savings, defined as profit enhancements or cost reductions approved by the Chief Executive Officer that result, on an annualized basis, in quantified and measured benefits to our financial performance. Although we continued to prioritize prudent cost control for 2023, the Compensation Committee elected to eliminate annualized cost savings as a separate performance metric because it is indirectly reflected in the calculation of non-GAAP operating income and could have an outsized effect on overall achievement, in particular during down years for the Company. Under the Management Incentive Plan, each Named Executive Officer was eligible to receive a performance bonus based on a specified percentage of base salary earned during the 2023 calendar year. As described above, cash bonus payouts for 2023 under the Management Incentive Plan were based on non-GAAP operating income after bonus. Any payout under the Management Incentive Plan was capped such that the payout would not exceed an amount equal to 200% of the Named Executive Officer’s Target Bonus Amount (defined below). In 2023, payouts under the Management Incentive Plan were determined by multiplying each Named Executive Officer’s “Target Bonus Amount” by the Company’s percentage achievement of non-GAAP operating

  64. Elements of Compensation

    income. Target Bonus Amount consists of each Named Executive Officer’s base salary earned in 2023, multiplied by his or her “Target Bonus Percentage,” as determined by our Compensation Committee. If a Named Executive Officer’s base salary and/or Target Bonus Percentage changed during 2023, the Named Executive Officer’s Target Bonus Amount was pro-rated based on the number of days in 2023 that the Named Executive Officer received such base salary and/or Target Bonus Percentage. When the Compensation Committee met in February 2023, it did not approve any Target Bonus Percentage increases for our Named Executive Officers, consistent with our Company-wide initiative to control costs in response to the decline in spending in our Semiconductor and Electronics & Packaging markets. Listed below is the Target Bonus Percentage for each Named Executive Officer in 2022 and 2023.

  65. Elements of Compensation

    | Named Executive Officer | 2022 Target Bonus Percentage | 2023 Target Bonus Percentage | | John T.C. Lee | 125% | 125% | | Seth H. Bagshaw | 90% | 90% | | Kathleen F. Burke | 70% | 70% | | David P. Henry | 65% | 65% | | James A. Schreiner | 65% | 65% |

  66. Elements of Compensation

    In 2023, our Compensation Committee approved goals and associated incentive payout opportunities related to our 2023 non-GAAP operating income. Due to the cyclical nature and volatility of the markets in which we operate, including the consumer electronics market and semiconductor market, our Compensation Committee views it of paramount importance to set financial performance goals that are rigorous but attainable given the outlook for these markets for the coming year. For 2023, our Compensation Committee set target achievement for non-GAAP operating income at an amount that was greater than actual achievement in 2022 but less than target achievement in 2022, in consideration of the extended semiconductor downturn and the softening in our Electronics & Packaging market. The successful alignment of our financial performance goals with our incentive payout opportunities for 2023 is evidenced by the fact that our Management Incentive Plan paid out at 86% achievement in a year marked by cyclical softness in our Semiconductor market as well as softness in our Electronics & Packaging market. In 2023, Named Executive Officers would receive the following percentage of their Target Bonus Amount under the Management Incentive Plan, with proportional payments for achievement in between the Threshold Bonus Amount and the Maximum Bonus Amount.

  67. Elements of Compensation

    | Non-GAAP Operating Income | % of Target Bonus Amount | | <$438.37 million | 0% | | $438.37 million (Threshold Bonus Amount) | 50% | | $813.78 million (Target Bonus Amount) | 100% | | ≥$1.14 billion (Maximum Bonus Amount) | 200% |

  68. Elements of Compensation

    If non-GAAP operating income before the calculation of bonus was greater than the Threshold Bonus Amount, but the inclusion of the bonus would result in an amount lower than the Threshold Bonus Amount, then only the portion of pre-bonus operating income above the Threshold Bonus Amount would be payable to Named Executive Officers on a pro rata basis. In 2023, for purposes of the Management Incentive Plan, non-GAAP operating income was $707 million. As a result, Named Executive Officers were eligible to receive 86% of their Target Bonus Amounts under this formula. For a reconciliation of 2023 loss from operations to 2023 non-GAAP operating income, see Appendix A to this proxy statement.

  69. Elements of Compensation

    | Named Executive Officer | Cash Payout | Payment as a Percentage of Target | | John T.C. Lee | $1,021,250 | 86% | | Seth H. Bagshaw | $482,802 | 86% | | Kathleen F. Burke | $303,408 | 86% | | David P. Henry | $251,550 | 86% | | James A. Schreiner | $260,337 | 86% |

  70. Elements of Compensation

    | Named Executive Officer | Grant Date Value of Performance- Based RSUs(1) | Number of Performance-Based RSUs(1) | Grant Date Value of Time-Based RSUs | Number of Time-Based RSUs | | John T.C. Lee | $3,600,000 | 35,895.90 | $2,400,000 | 23,930.60 | | Seth H. Bagshaw | $1,058,750 | 10,556.89 | $866,250 | 8,637.45 | | Kathleen F. Burke | $562,500 | 5,608.74 | $562,500 | 5,608.74 | | David P. Henry | $375,000 | 3,739.16 | $375,000 | 3,739.16 | | James A. Schreiner | $400,000 | 3,988.43 | $400,000 | 3,988.43 |

  71. Elements of Compensation

    | (1) Grant date value of performance-based RSUs and corresponding number of performance-based RSUs assuming 100% achievement. Achievement is capped at 200%. |

  72. Elements of Compensation

    operating income excluding any charges or income not related to the operating performance of the Company plus depreciation and stock compensation expense. We believe Adjusted EBITDA provides a clear indication of how effectively we manage the operations of our Company, while continuing to recognize the cyclical nature and volatility of the markets we serve, as well as to drive continued improvement in our Company’s operating model independent of revenue levels. Further, we choose to measure Adjusted EBITDA over a one-year performance period because of the cyclical nature and volatility of our markets, making it challenging to set multi-year performance targets, as evidenced by the current extended semiconductor downturn, with global semiconductor sales down approximately 10% in 2023. To ensure our executive officers are focused on our Company’s long-term performance, the performance-based RSUs vest in equal annual installments over three years from the original date of grant. We use RSUs as our form of equity incentive compensation because we believe RSUs help to ensure that our executive officers’ interests are aligned with our shareholders’ interests in both a rising and a declining stock market. We believe RSUs are preferable to stock options, which have a relatively high accounting cost as compared to their potential value to the executive officer, and restricted stock, which gives the executive officer voting and dividend rights prior to full vesting. Also, because RSUs are worth more than stock options on the date of grant, we are able to grant fewer RSUs as compared to stock options, resulting in less dilution to shareholders’ holdings. In 2023, our Named Executive Officers would have forfeited all of their performance-based RSUs if our Adjusted EBITDA was less than $661.64 million at a revenue level of $3.60 billion or if our Adjusted EBITDA was less than $915.94 million at a revenue level of $4.30 billion (with intermediate Adjusted EBITDA minimum thresholds at different revenue levels in between). However, if we did achieve these Adjusted EBITDA threshold levels at the respective revenue levels identified, then our Named Executive Officers would receive 50% of their target performance-based RSUs. If our Adjusted EBITDA was $827.29 million at a revenue level of $3.70 billion or was $1.08 billion at a revenue level of $4.30 billion (with proportional thresholds in between), then our Named Executive Officers would receive 100% of their target performance-based RSUs. If our Adjusted EBITDA was at or above $910.02 million at a revenue level of $3.70 billion or was at or above $1.19 billion at a revenue level of $4.30 billion (with proportional thresholds in between), then our Named Executive Officers would receive the maximum of 200% of their target performance-based RSUs. If revenue was outside the range of $3.70 billion and $4.30 billion, then the performance target and payout would be calculated using the same payout formula. Proportional achievement levels would be made for Adjusted EBITDA between the minimum and maximum levels. In 2023, because our revenue was $3.62 billion and our Adjusted EBITDA was $863 million, our Named Executive Officers received 193% of their target performance-based RSUs. Our performance-based equity awards paid out above target achievement because we were still able to deliver strong non-GAAP profitability by successfully navigating continued headwinds from the decline in industry semiconductor capital equipment spending and significant year-over-year declines in PCs, data center servers, and smartphones, as well as successfully restoring global operations following the ransomware incident in the first quarter, including recovering nearly all of the impacted revenue over the balance of the calendar year. These performance-based RSUs, along with the time-based RSUs granted to our Named Executive Officers, vest in equal annual installments over three years from the original date of grant. For a reconciliation of 2023 net loss to 2023 Adjusted EBITDA, see Appendix A to this proxy statement. It is our practice to make an initial equity-based grant to all of our Named Executive Officers at the time they commence employment in an amount that is consistent with amounts granted to other executive officers in the industry at similar levels of seniority. We also may make equity-based grants to a Named Executed Officer in connection with a promotion or other change in position. In addition, we typically make an annual grant of equity-based compensation to our Named Executive Officers during the first fiscal quarter of each year. Discretionary equity-based awards may also be made during the year to provide an incentive to achieve a specific goal or to reward a significant achievement or for other reasons that the Compensation Committee determines. Our Compensation Committee did not make any discretionary equity-based awards to our Named Executive Officers in 2023. Incorporation of Relative Total Shareholder Return for Calendar Years Beginning in 2024 In February 2024, our Compensation Committee modified our long-term equity incentive compensation program to further align executive and shareholder interests. As described above, from 2020 to 2023,

  73. Elements of Compensation

    performance-based RSUs were awarded to our Named Executive Officers based on one performance metric, Adjusted EBITDA. Following a review of market practice, the Compensation Committee determined that a portion of future performance-based RSUs awarded to our Named Executive Officers should be based on a second performance metric, relative total shareholder return, or rTSR, defined as our annualized rate of return (including appreciation in stock price and reinvestment of dividends) compared to the S&P 1500 Composite Electronic Equipment, Instruments & Components Index. Our Compensation Committee believes measuring performance-based RSU achievement using rTSR reinforces alignment between executive and shareholder interests. Beginning in 2024, each of our Named Executive Officers will receive two performance-based awards, one of which will be subject to Adjusted EBITDA and account for 70% of his or her target performance-based RSUs and the other of which will be subject to rTSR and account for 30% of his or her target performance-based RSUs. Awards subject to Adjusted EBITDA will continue to be measured over one year and vest in equal annual installments over three years. In contrast to the awards subject to Adjusted EBITDA, awards subject to rTSR will be measured over a three-year period and will vest in full on or about the third anniversary of the date of grant. In addition, the awards subject to rTSR will have the following limitations: (i) in the event our total shareholder return is negative but above the 50% percentile relative to the S&P 1500 Composite Electronic Equipment, Instruments & Components Index, payouts will be capped at 100%; and (ii) the total value of the awards at the vest date may not exceed 8x the value of the awards at the grant date, reducing the accounting cost of the awards. Our Compensation Committee views these two limitations as prudent governance features. Our Compensation Committee believes the addition of the rTSR metric, including the three-year performance measurement period, strengthens long-term alignment between executive and shareholder interests and elevates the performance orientation of our executive compensation program. Perquisites Our Compensation Committee elected to discontinue perquisites effective December 31, 2020, with the exception that Mr. Bagshaw and Mr. Schreiner were permitted to retain their company-leased cars until the expiration of their leases in May 2023 and November 2023, respectively, to avoid lease cancellation costs. Our Compensation Committee believes the discontinuation of perquisites allows us to simplify and more consistently align our compensation and benefits offerings with other employees, while placing greater focus on performance-based compensation.

  74. Severance and Change-in-Control Provisions

    Severance and Change-in-Control Provisions Each of our Named Executive Officers is entitled to certain payments and benefits in the event his or her employment terminates under specified circumstances as described in the applicable agreement and subject to his or her entry into a release of claims. In exchange for these payments and benefits, each of these officers has agreed to be restricted from competing with the Company during and following his or her termination of employment for a twelve-month period. In addition, RSU agreements with our Named Executive Officers with time-based vesting generally provide for acceleration of vesting in the event the executive’s employment is terminated without cause or the executive resigns for good reason within 24 months after a change-in-control event. RSU agreements with our Named Executive Officers with performance-based vesting based on Adjusted EBITDA provide for acceleration of vesting at target-level achievement in the event the executive’s employment is terminated without cause or the executive resigns for good reason within 24 months after a change-in-control event. RSU agreements with our Named Executive Officers with performance-based vesting based on rTSR provide that the performance period for such shares shall end on the day prior to the closing date of a change in control, with the number of shares, if any, that would have vested on such date, as determined in accordance with the terms of such agreements, converting into time-based vesting RSUs subject to acceleration of vesting in the event the executive’s employment is terminated without cause or the executive resigns for good reason within 24 months after a change-in-control event. The severance and change-in-control provisions are designed to be competitive in the marketplace, to provide security for each of our Named Executive Officers in the event that we are acquired and his or her respective position is impacted and to provide an incentive for our Named Executive Officers to stay with us through such a change-in-control event. These provisions are also intended to protect us from competitive harm by compensating our Named Executive Officers for agreeing to substantial non-compete provisions after employment termination. See “Executive Compensation Tables — Potential Payments Upon Termination or Change-in-Control” for more information about these agreements.

  75. Severance and Change-in-Control Provisions

    | MKS INSTRUMENTS, INC. | 2024 PROXY STATEMENT | 48 |

  76. Compensation Consultant

    Compensation Consultant We engage a compensation consultant to serve as an independent advisor to the Compensation Committee regarding compensation for our directors and our executive officers. The Compensation Committee utilizes the compensation consultant in the following ways:

  77. Compensation Consultant

    | • | to provide the Compensation Committee with occasional consultation regarding compensation strategies and programs; |

  78. Compensation Consultant

    | • | to review our peer group to determine the appropriateness of its composition; |

  79. Compensation Consultant

    | • | to conduct formal competitive compensation analysis for the Compensation Committee regarding our directors and each executive officer, on a position-by-position basis, in comparison to similarly situated executive officers in our peer group using benchmarking data; |

  80. Compensation Consultant

    | • | to assess the rigor of proposed performance goals on the basis of a probability analysis, a year-over-year growth analysis and a historical payout versus our peer group analysis; and |

  81. Compensation Consultant

    | • | to assist the Compensation Committee with conducting a risk assessment of all of the Company’s compensation policies and practices. |

  82. Compensation Consultant

    Since May 2019, the Compensation Committee has engaged Pearl Meyer as its compensation consultant. The Compensation Committee has determined that the engagement of Pearl Meyer as a compensation consultant does not raise any conflicts of interest with MKS.

  83. Governance Policies

    Share ownership is measured as of December 31 of each year. The Stock Ownership Guidelines count shares of common stock and restricted stock units toward share ownership, except that restricted stock units subject to performance conditions are not counted. The Stock Ownership Guidelines provide for a phase-in period over five years to achieve compliance. Our directors, CEO and other Named Executive Officers were all in compliance with the Stock Ownership Guidelines as of December 31, 2023. Clawback Policy Our Compensation Committee adopted an updated clawback policy, effective October 2, 2023, in accordance with Rule 10D-1 of the Exchange Act, or Rule 10D-1, and Nasdaq listing standards. The clawback policy applies to our current and former executive officers, as defined in Rule 10D-1, as well as other current executives who report to our Chief Executive Officer and other former executives who reported to our Chief Executive Officer. The clawback policy is administered by our Compensation Committee. In the event we are required to prepare an accounting restatement due to material noncompliance with any financial reporting requirement under U.S. federal securities laws, including any required restatement to correct an error in previously issued financial statements that is material to the previously issued financial statements or that would result in a material misstatement if the error were corrected in the current period or left uncorrected in the current period, it is our policy to recover reasonably promptly the amount of erroneously awarded incentive-based compensation received by our executives. The recovery of such compensation applies regardless of whether an executive engaged in misconduct or otherwise cause or contributed to the requirement for a restatement, although the Compensation Committee is authorized to recover additional incentive-based compensation in situations where an executive engaged in intentional misconduct or fraud. Our current clawback policy is substantially similar to our prior clawback policy, except that it (i) applies to not only executive officers but also other executives who report to our Chief Executive Officer and other former executives who reported to our Chief Executive Officer and (ii) mandates recovery of incentive-based compensation except in specific situations. Our prior clawback policy only required us to take reasonable efforts to recover incentive-based compensation. Prohibition on Hedging and Pledging Our Insider Trading Policy prohibits any of our directors or employees from engaging in purchases of financial instruments or other transactions that hedge or offset, or are designed to hedge or offset, any decrease in the market value of our securities (including pre-paid variable forward contracts, equity swaps, collars, and exchange funds), and prohibits such individuals from purchasing our securities on margin or pledging such securities as collateral for a loan.

  84. Summary Compensation Table for 2023

    Summary Compensation Table for 2023 The following table sets forth the aggregate amounts of compensation earned by our Named Executive Officers in the years ended December 31, 2023, 2022, and 2021.

  85. Summary Compensation Table for 2023

    | Name and Principal Position | Year | Salary ($) | Bonus ($) | Stock Awards ($)(1) | Non-Equity Incentive Plan Compensation ($)(2) | All Other Compensation ($)(3) | Total ($) | | John T.C. Lee, President and CEO (principal executive officer) | 2023 | $950,000 | $- | $6,000,000 | $1,021,250 | $35,288 | $8,006,538 | | | 2022 | $944,727 | $- | $6,000,000 | $1,170,939 | $32,732 | $8,148,398 | | | 2021 | $908,863 | $- | $4,520,000 | $2,178,466 | $31,026 | $7,638,355 | | Seth H. Bagshaw, EVP, CFO, and Treasurer (principal financial officer) | 2023 | $623,775 | $- | $1,925,000 | $482,802 | $40,546 | $3,072,123 | | | 2022 | $615,774 | $- | $1,925,000 | $554,154 | $44,042 | $3,138,970 | | | 2021 | $592,075 | $50,000(4) | $1,825,000 | $1,064,683 | $35,155 | $3,566,913 | | Kathleen F. Burke, EVP, General Counsel, and Secretary | 2023 | $504,000 | $- | $1,125,000 | $303,408 | $35,288 | $1,967,696 | | | 2022 | $499,773 | $- | $1,125,000 | $349,809 | $32,725 | $2,007,307 | | | 2021 | $475,885 | $50,000(4) | $1,050,000 | $665,404 | $30,979 | $2,272,268 | | David P. Henry, EVP, Operations and Corporate Marketing | 2023 | $450,000 | $- | $750,000 | $251,550 | $35,403 | $1,486,953 | | | 2022 | $442,604 | $- | $750,000 | $283,116 | $33,047 | $1,508,767 | | | 2021 | $411,006 | $50,000(4) | $600,000 | $492,001 | $32,952 | $1,585,959 | | James A. Schreiner, EVP and COO, Materials Solutions Division | 2023 | $465,718 | $- | $800,000 | $260,337 | $494,827 | $2,020,882 | | | 2022 | $457,598 | $- | $800,000 | $297,407 | $45,389 | $1,600,394 | | | 2021 | $433,543 | $50,000(4) | $675,000 | $563,001 | $88,221 | $1,809,765 |

  86. Summary Compensation Table for 2023

    | (1) Represents the aggregate grant date fair value for each RSU granted to the executive officer during the covered year, calculated in accordance with ASC 718. The assumptions used in determining the aggregate grant date fair values of awards are set forth in Note 18 to our consolidated financial statements, which were included in our Annual Report on Form 10-K that was filed with the SEC on February 27, 2024. The amounts under the “Stock Awards” column do not reflect the amount of compensation actually received by the Named Executive Officers during the fiscal year. At least fifty percent of the values listed under “Stock Awards” represent performance-based RSUs, which are valued at the grant date based upon the probable outcome of the performance metrics. The following table sets forth (i) the maximum value of the RSUs, assuming the highest level of performance is achieved for the performance-based portion of the RSUs, and (ii) the fair value of the RSUs, based on actual achievement of the performance condition as described above under “CD&A — Elements of Compensation — Long-Term Equity Incentive Compensation”: |

  87. Summary Compensation Table for 2023

    | | 2023 | | 2022 | | 2021 | | | Named Executive Officer | Maximum | Actual | Maximum | Actual | Maximum | Actual | | Dr. Lee | $9,600,000 | $9,348,000 | $9,600,000 | $7,404,000 | $7,006,000 | $7,006,000 | | Mr. Bagshaw | $2,983,750 | $2,909,637 | $2,983,750 | $2,337,913 | $2,828,750 | $2,828,750 | | Ms. Burke | $1,687,500 | $1,648,125 | $1,687,500 | $1,344,375 | $1,575,000 | $1,575,000 | | Mr. Henry | $1,125,000 | $1,098,750 | $1,125,000 | $896,250 | $900,000 | $900,000 | | Mr. Schreiner | $1,200,000 | $1,172,000 | $1,200,000 | $956,000 | $1,012,500 | $1,012,500 |

  88. Summary Compensation Table for 2023

    | (2) Each Named Executive Officer’s annual cash performance bonus for 2023, 2022, and 2021 was calculated based on a specified target percentage of his or her eligible earnings for the relevant plan year. The threshold bonus payout was 50% of this individual target bonus percentage and the maximum payout was 200% of this individual target bonus percentage, with proportional payouts for performance between these levels. Bonus payments in 2023 were based on the achievement of non-GAAP operating income (defined as GAAP operating income after bonus and excluding any charges or income not related to the operating performance |

  89. Summary Compensation Table for 2023

    | MKS INSTRUMENTS, INC. | 2024 PROXY STATEMENT | 52 |

  90. Summary Compensation Table for 2023

    | of the Company) for 2023. Bonus payments in 2022 were based on the achievement of two financial metrics: (i) non-GAAP operating income (defined as GAAP operating income after bonus and excluding any charges or income not related to the operating performance of the Company) for 2022, excluding the results of Atotech, which we acquired in 2022, and (ii) annualized cost savings (defined as profit enhancements or cost reductions approved by the Chief Executive Officer that result, on an annualized basis, in quantified and measured benefits to the Company’s financial performance) for 2022. Bonus payments in 2021 were based on the achievement of non-GAAP operating income for 2021, excluding the results of Photon Control Inc., or Photon Control, which we acquired in July 2021. The individual target bonus percentage and the actual bonus achieved for each of the Named Executive Officers were as follows: |

  91. Summary Compensation Table for 2023

    | | 2023 | | 2022 | | 2021 | | | | Individual Target Bonus % | Annual Bonus Plan Achievement | Individual Target Bonus % | Annual Bonus Plan Achievement | Individual Target Bonus % | Annual Bonus Plan Achievement | | Named Executive Officer | | | | | | | | Dr. Lee | 125% | 86% | 125% | 100% | 120% | 200% | | Mr. Bagshaw | 90% | 86% | 90% | 100% | 90% | 200% | | Ms. Burke | 70% | 86% | 70% | 100% | 70% | 200% | | Mr. Henry | 65% | 86% | 65% | 100% | 60% | 200% | | Mr. Schreiner | 65% | 86% | 65% | 100% | 65% | 200% |

  92. Summary Compensation Table for 2023

    | (3) Our Compensation Committee elected to discontinue perquisites effective December 31, 2020, with the exception that Mr. Bagshaw and Mr. Schreiner were permitted to retain their company-leased cars until the expiration of their leases in May 2023 and November 2023, respectively, to avoid lease cancellation costs, as described under “Executive Compensation — Compensation Discussion and Analysis — Elements of Compensation — Perquisites.” The amounts paid for such perquisites and the amount of all other compensation consisted of the following: |

  93. Summary Compensation Table for 2023

    | Named Executive Officer | Year | Auto | Health & Disability | 401(k) Match | Global Mobility | Relocation | | Dr. Lee | 2023 | $- | $25,388 | $9,900 | $- | $- | | | 2022 | $- | $23,582 | $9,150 | $- | $- | | | 2021 | $- | $22,326 | $8,700 | $- | $- | | Mr. Bagshaw | 2023 | $5,258 | $25,388 | $9,900 | $- | $- | | | 2022 | $11,310 | $23,582 | $9,150 | $- | $- | | | 2021 | $4,129 | $22,326 | $8,700 | $- | $- | | Ms. Burke | 2023 | $- | $25,388 | $9,900 | $- | $- | | | 2022 | $- | $23,575 | $9,150 | $- | $- | | | 2021 | $- | $22,279 | $8,700 | $- | $- | | Mr. Henry | 2023 | $- | $25,503 | $9,900 | $- | $- | | | 2022 | $- | $23,897 | $9,150 | $- | $- | | | 2021 | $- | $24,252 | $8,700 | $- | $- | | Mr. Schreiner | 2023 | $11,323 | $25,629 | $9,900 | $447,976 | $- | | | 2022 | $12,280 | $23,959 | $9,150 | $- | $- | | | 2021 | $11,579 | $17,520 | $8,700 | $- | $50,422 |

  94. Summary Compensation Table for 2023

    Health & Disability benefits for 2023 included partial payment of premiums for medical, dental, vision, short-term and long-term disability, and life insurance. Global Mobility benefits included benefits provided to Mr. Schreiner as a result of his expatriate service in Germany, including housing and utilities, auto, home leave, work permit assistance, local country unemployment insurance, foreign language classes, and tax equalization payments. The tax equalization payments, which amount to $359,167, reflect the estimated total net amount of tax equalization designed to cover taxes on Mr. Schreiner’s compensation in excess of the taxes he would have incurred in the United States, in accordance with our global mobility program.

  95. Summary Compensation Table for 2023

    | (4) Represents a discretionary cash bonus made in recognition of outstanding leadership of and attention to multiple strategic transactions. |

  96. Summary Compensation Table for 2023

    | MKS INSTRUMENTS, INC. | 2024 PROXY STATEMENT | 53 |

  97. CEO Pay Ratio

    CEO Pay Ratio We disclose the ratio of our median employee’s annual total compensation to our principal executive officer’s annual total compensation to provide a measure of equitability of pay within our Company. We believe our compensation philosophy and process yield an equitable result for all of our employees. During 2023, our principal executive officer was our Chief Executive Officer, John T.C. Lee. For 2023, the annual total compensation for Dr. Lee was $8,006,538 and the annual total compensation for our median employee was $70,497, resulting in a pay ratio of approximately 114:1. In accordance with applicable SEC rules, we identified the median employee as of December 18, 2022 (the median employee determination date) by (i) aggregating for each applicable employee (A) annual base salary for salaried employees (or hourly rate multiplied by expected annual work schedule for hourly employees), (B) target bonus and commissions (or local country equivalent), (C) actual overtime and double-time received for 2022, and (D) the accounting value of any equity granted during 2022, and (ii) ranking this compensation measure for our employees from lowest to highest. This calculation was performed for all employees, excluding Dr. Lee, whether employed on a full-time, part-time, or seasonal basis. For purposes of identifying the median employee, we converted amounts paid in foreign currencies to U.S. Dollars based on the applicable average exchange rates for December 2022. For 2023, we continued to use our 2022 median employee for our pay ratio analysis, as there have been no changes to our employee population or employee compensation arrangements that we reasonably believed would significantly affect our pay ratio disclosure. The pay ratio reported above is a reasonable estimate calculated in a manner consistent with SEC rules based on our internal records and the methodology described above. Because the SEC rules for identifying the median compensated employee and calculating the pay ratio based on that employee’s annual total compensation allow companies to adopt a variety of methodologies, apply certain exclusions, and make reasonable estimates and assumptions that reflect their employee populations and compensation practices, 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 utilize different methodologies, exclusions, estimates, and assumptions in calculating their own pay ratios.

  98. CEO Pay Ratio

    | MKS INSTRUMENTS, INC. | 2024 PROXY STATEMENT | 54 |

  99. Pay Versus Performance

    Pay Versus Performance

  100. Tabular Disclosure of Compensation Actually Paid versus Performance

    Tabular Disclosure of Compensation Actually Paid versus Performance The following table discloses information on “compensation actually paid,” or CAP, to our principal executive officers, or PEOs, and, the average CAP, to our other Named Executive Officers, or non-PEO NEOs, during the previous four fiscal years, alongside Company total shareholder return, or TSR, peer group TSR, net (loss) income, and the Company-selected financial performance measure of Adjusted EBITDA.

  101. Tabular Disclosure of Compensation Actually Paid versus Performance

    | | Summary Compensation Table Total for PEO(1) | | CAP to PEO(2) | | Average Summary Compensation Table Total for Non-PEO NEOs(3) | Average CAP to Non-PEO NEOs(4) | Value of Initial Fixed $100 Investment Based On: | | Net (Loss) Income ($ millions) | Adjusted EBITDA ($ millions)(6) | | Year | Lee | Colella | Lee | Colella | | | TSR | Peer Group TSR(5) | | | | 2023 | $8,006,538 | N/A | $13,215,067 | N/A | $2,136,914 | $3,083,750 | $96.33 | $150.70 | $(1,841) | $863 | | 2022 | $8,148,398 | N/A | $3,494,929 | N/A | $2,063,860 | $759,709 | $78.58 | $125.15 | $333 | $854 | | 2021 | $7,638,355 | N/A | $11,383,747 | N/A | $2,320,658 | $3,336,104 | $160.26 | $160.00 | $551 | $868 | | 2020 | $6,127,026 | $423,777 | $8,922,167 | $838,753 | $2,284,429 | $3,494,613 | $137.71 | $123.86 | $350 | $601 |

  102. Tabular Disclosure of Compensation Actually Paid versus Performance

    | (1) These amounts reflect the total compensation of Dr. Lee for the previous four years and the total compensation of Mr. Colella for 2020, each as calculated in accordance with the requirements of Item 402(c) of Regulation S-K, or Item 402(c). Dr. Lee succeeded Mr. Colella as our Chief Executive Officer on January 1, 2020. |

  103. Tabular Disclosure of Compensation Actually Paid versus Performance

    | (2) These amounts reflect CAP for Dr. Lee for the previous four years and for Mr. Colella for 2020, each as calculated in accordance with Item 402(v) of Regulation, S-K, or Item 402(v). The table below summarizes the adjustments required to reconcile total compensation from the summary compensation table to CAP for Dr. Lee in 2023. |

  104. Tabular Disclosure of Compensation Actually Paid versus Performance

    | | 2023 | | Adjustment | Lee | | Total Compensation from Summary Compensation Table | $8,006,538 | | Less Fair Value of Equity Awards Reported in the Summary Compensation Table in the Covered Year | $(6,000,000) | | Plus Fair Value of Covered Year Equity Awards Unvested at Fiscal Year-End | $9,488,697 | | Year-Over-Year Change in Fair Value of Prior Years’ Equity Awards Unvested at Fiscal Year-End | $989,809 | | Change as of the Vesting Date (From the End of the Prior Fiscal Year) in Fair Value of Prior Years’ Equity Awards Vested in the Covered Year | $730,023 | | Compensation Actually Paid | $13,215,067 |

  105. Tabular Disclosure of Compensation Actually Paid versus Performance

    | (3) Reflects the average total compensation of Mr. Bagshaw, Ms. Burke, Mr. Henry, and Mr. Schreiner for 2023 and 2022, the average total compensation of Mr. Bagshaw, Ms. Burke, Dr. Gitin, and Mr. Schreiner for 2021, and the average total compensation of Mr. Bagshaw, Ms. Burke, and Mr. Schreiner for 2020, each as calculated in accordance with the requirements of Item 402(c). |

  106. Tabular Disclosure of Compensation Actually Paid versus Performance

    | MKS INSTRUMENTS, INC. | 2024 PROXY STATEMENT | 55 |

  107. Tabular Disclosure of Compensation Actually Paid versus Performance

    | (4) These amounts reflect the average CAP for our non-PEO NEOs for the previous four years, each as calculated in accordance with the requirements of Item 402(v). The table below summarizes the adjustments required to reconcile average total compensation from the summary compensation table to average CAP for our non-PEO NEOs in 2023. |

  108. Tabular Disclosure of Compensation Actually Paid versus Performance

    | Adjustment | 2023 | | | Non-PEO NEOs | | Average Total Compensation from Summary Compensation Table | $2,136,914 | | Less Average Fair Value of Equity Awards Reported in the Summary Compensation Table in the Covered Year | $(1,150,000) | | Plus Average Fair Value of Covered Year Equity Awards Unvested at Fiscal Year-End | $1,742,044 | | Year-Over-Year Change in Average Fair Value of Prior Years’ Equity Awards Unvested at Fiscal Year-End | $198,872 | | Change as of the Vesting Date (From the End of the Prior Fiscal Year) in Average Fair Value of Prior Years’ Equity Awards Vested in the Covered Year | $155,920 | | Average Compensation Actually Paid | $3,083,750 |

  109. Tabular Disclosure of Compensation Actually Paid versus Performance

    | (5) Peer Group TSR represents TSR for the S&P 1500 Composite Electronic Equipment Instruments & Components Index, which is the industry peer group used for purposes of Item 201(e) of Regulation S-K. |

  110. Tabular Disclosure of Compensation Actually Paid versus Performance

    | (6) We selected this measure as the most important in linking 2023 NEO CAP to Company performance because long-term equity incentive compensation comprised the largest percentage of total NEO compensation and Adjusted EBITDA was the financial measure we used to determine achievement under our long-term performance-based equity compensation awards. Adjusted EBITDA is defined as the Company’s GAAP operating income, excluding any charges or income not related to the operating performance of the Company, plus depreciation and stock compensation expense. For 2022, Adjusted EBITDA excludes the results of Atotech, which we acquired in August 2022. For 2021, Adjusted EBITDA excludes the results of Photon Control, which we acquired in July 2021. For further information regarding Adjusted EBITDA and its function in our executive compensation program, see “Executive Compensation — Compensation Discussion and Analysis — Elements of Compensation — Long-Term Equity Incentive Compensation” above. |

  111. Tabular Disclosure of Compensation Actually Paid versus Performance

    | MKS INSTRUMENTS, INC. | 2024 PROXY STATEMENT | 56 |

  112. Disclosure of the Relationship Between Compensation Actually Paid and Financial Performance Measures

    Disclosure of the Relationship Between Compensation Actually Paid and Financial Performance Measures The following two graphs further illustrate the relationship between the pay and performance figures that are included in the pay versus performance tabular disclosure above. The first graph below illustrates the relationship among PEO CAP, Average Non-PEO CAP, Company total shareholder return (MKS TSR), and S&P 1500 Composite Electronic Equipment Instruments & Components Index total shareholder return (Peer Group TSR). The second graph below illustrates the relationship among PEO CAP, Average Non-PEO CAP, Company Net (Loss) Income, and Company Adjusted EBITDA.

  113. Disclosure of the Relationship Between Compensation Actually Paid and Financial Performance Measures

    | MKS INSTRUMENTS, INC. | 2024 PROXY STATEMENT | 57 |

  114. Tabular Disclosure of Most Important Measures Linking Compensation Actually Paid During 2023 to Company Performance

    Tabular Disclosure of Most Important Measures Linking Compensation Actually Paid During 2023 to Company Performance We disclose below the most important measures we used to link 2023 NEO CAP to Company performance. Named Executive Officers’ performance-based equity compensation was determined based on achievement of Adjusted EBITDA at different revenue levels. Named Executive Officers’ variable cash compensation was determined based on achievement of non-GAAP operating income. For further information regarding these measures and their function in our executive compensation program, see “Executive Compensation — Compensation Discussion and Analysis” above.

  115. Tabular Disclosure of Most Important Measures Linking Compensation Actually Paid During 2023 to Company Performance

    | 2023 Most Important Measures | | Adjusted EBITDA | | Non-GAAP Operating Income | | Revenue |

  116. Tabular Disclosure of Most Important Measures Linking Compensation Actually Paid During 2023 to Company Performance

    | MKS INSTRUMENTS, INC. | 2024 PROXY STATEMENT | 58 |

  117. Grants of Plan-Based Awards in Fiscal Year 2023 Table

    Grants of Plan-Based Awards in Fiscal Year 2023 Table

  118. Grants of Plan-Based Awards in Fiscal Year 2023 Table

    | Name | Grant Date(1) | Approval Date(2) | Estimated Future Payouts Under Non-Equity Incentive Plan Awards(3) | | | Estimated Future Payouts Under Equity Incentive Plan Awards(4) | | | All Other Stock Awards: Number of Shares of Stock or Units (#)(5) | Grant Date Fair Value of Stock Awards ($)(6) | | | | | Threshold ($) | Target ($) | Maximum ($) | Threshold (#) | Target (#) | Maximum (#) | | | | John T.C. Lee | N/A | N/A | $593,750 | $1,187,500 | $2,375,000 | | | | | | | | 2/15/2023 | 2/4/2023 | | | | 17,948 | 35,896 | 71,792 | 23,931 | $6,000,000 | | Seth H. Bagshaw | N/A | N/A | $280,699 | $561,398 | $1,122,795 | | | | | | | | 2/15/2023 | 2/4/2023 | | | | 5,278 | 10,557 | 21,114 | 8,367 | $1,925,000 | | Kathleen F. Burke | N/A | N/A | $176,400 | $352,800 | $705,600 | | | | | | | | 2/15/2023 | 2/4/2023 | | | | 2,804 | 5,609 | 11,217 | 5,609 | $1,125,000 | | David P. Henry | N/A | N/A | $146,250 | $292,500 | $585,000 | | | | | | | | 2/15/2023 | 2/4/2023 | | | | 1,870 | 3,739 | 7,478 | 3,739 | $750,000 | | James A. Schreiner | N/A | N/A | $151,358 | $302,717 | $605,433 | | | | | | | | 2/15/2023 | 2/4/2023 | | | | 1,944 | 3,988 | 7,977 | 3,988 | $800,000 |

  119. Grants of Plan-Based Awards in Fiscal Year 2023 Table

    | (1) This column shows the date of grant for equity awards granted in 2023, all of which were made under the 2022 Stock Incentive Plan. |

  120. Grants of Plan-Based Awards in Fiscal Year 2023 Table

    | (2) This column shows the date on which the Compensation Committee approved the grant of equity awards. The performance metrics underlying such awards were established on the approval date. |

  121. Grants of Plan-Based Awards in Fiscal Year 2023 Table

    | (3) Represents aggregate threshold, target, and maximum payout levels under the annual cash incentive plan. The actual amount of annual cash incentive compensation earned by each Named Executive Officer in 2023 is reported under the Non-Equity Incentive Plan Compensation column in the Summary Compensation Table for 2023. See Footnote 2 to the Summary Compensation Table for 2023 for details on the terms of the annual cash incentive plan. |

  122. Grants of Plan-Based Awards in Fiscal Year 2023 Table

    | (4) These RSUs vest in equal annual installments over three years beginning in February 2024, subject to achievement of performance metrics established in 2023 and determined in February 2024. |

  123. Grants of Plan-Based Awards in Fiscal Year 2023 Table

    | (5) These RSUs vest in equal annual installments over three years beginning in February 2024. |

  124. Grants of Plan-Based Awards in Fiscal Year 2023 Table

    | (6) Reflects the combined grant date fair value of performance-based RSUs at the target achievement level and time-based RSUs. The fair value was $100.29 per share for RSUs awarded on February 15, 2023. |

  125. Grants of Plan-Based Awards in Fiscal Year 2023 Table

    | MKS INSTRUMENTS, INC. | 2024 PROXY STATEMENT | 59 |

  126. Outstanding Equity Awards at 2023 Fiscal Year-End Table

    Outstanding Equity Awards at 2023 Fiscal Year-End Table

  127. Outstanding Equity Awards at 2023 Fiscal Year-End Table

    | | Stock Awards(1) | | | | | Name | Number of Shares or Units of Stock That Have Not Vested (#) | Market Value of Shares or Units of Stock That Have Not Vested(2) ($) | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#) | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested(2) ($) | | John T.C. Lee | 13,013(3) | $1,338,673 | 71,792(5) | $7,385,223 | | | 41,552(4) | $4,274,430 | | | | | 22,961(5) | $2,361,957 | | | | Seth H. Bagshaw | 5,254(3) | $540,491 | 21,114(5) | $2,171,974 | | | 13,121(4) | $1,349,716 | | | | | 8,287(5) | $852,530 | | | | Kathleen F. Burke | 3,049(3) | $313,686 | 11,217(5) | $1,153,941 | | | 7,864(4) | $808,952 | | | | | 5,609(5) | $576,971 | | | | David P. Henry | 1,743(3) | $179,352 | 7,478(5) | $769,294 | | | 4,894(4) | $503,446 | | | | | 362(6) | $37,209 | | | | | 3,739(5) | $384,647 | | | | James A. Schreiner | 1,961(3) | $201,707 | 7,977(5) | $820,580 | | | 5,243(4) | $539,370 | | | | | 362(6) | $37,209 | | | | | 3,988(5) | $410,290 | | |

  128. Outstanding Equity Awards at 2023 Fiscal Year-End Table

    | (1) All stock awards in the above table are RSUs. All RSUs vest in three equal annual installments, with an annual vesting date of February 15th or the next business day if February 15th is not a business day. RSUs listed in the “Equity Incentive Plan Awards” column were subject to the achievement of performance criteria. The amounts listed in such column assume maximum achievement of such performance criteria. None of the Named Executive Officers had any outstanding option awards. |

  129. Outstanding Equity Awards at 2023 Fiscal Year-End Table

    | (2) The values were calculated based on the closing price of our Common Stock on December 29, 2023 of $102.87 per share. |

  130. Outstanding Equity Awards at 2023 Fiscal Year-End Table

    | (3) Grant date is February 16, 2021. |

  131. Outstanding Equity Awards at 2023 Fiscal Year-End Table

    | (4) Grant date is April 29, 2022. |

  132. Outstanding Equity Awards at 2023 Fiscal Year-End Table

    | (5) Grant date is February 15, 2023. |

  133. Outstanding Equity Awards at 2023 Fiscal Year-End Table

    | (6) Grant date is August 17, 2022. |

  134. Option Exercises and Stock Vested in Fiscal Year 2023 Table

    Option Exercises and Stock Vested in Fiscal Year 2023 Table

  135. Option Exercises and Stock Vested in Fiscal Year 2023 Table

    | | Stock Awards* | | | Name | Number of Shares Acquired on Vesting (#)(1) | Value Realized on Vesting ($)(2) | | John T.C. Lee | 50,305(3) | $4,992,393 | | Seth H. Bagshaw | 18,704(3) | $1,864,558 | | Kathleen F. Burke | 10,106 | $1,013,503 | | David P. Henry | 5,539 | $555,484 | | James A. Schreiner | 6,457 | $647,586 |

  136. Option Exercises and Stock Vested in Fiscal Year 2023 Table

    | (1) Reflects the number of shares vested before the surrender of shares in satisfaction of tax withholding obligations. |

  137. Option Exercises and Stock Vested in Fiscal Year 2023 Table

    | (2) Reflects the value realized before satisfaction of tax withholding obligations. |

  138. Option Exercises and Stock Vested in Fiscal Year 2023 Table

    | MKS INSTRUMENTS, INC. | 2024 PROXY STATEMENT | 60 |

  139. Option Exercises and Stock Vested in Fiscal Year 2023 Table

    | (3) Includes partial vesting of certain awards to cover U.S. Federal Insurance Contribution Act (FICA) tax withholding obligations, as Dr. Lee and Mr. Bagshaw are retirement eligible. |

  140. Option Exercises and Stock Vested in Fiscal Year 2023 Table

    | * There were no option exercises in 2023. |

  141. Potential Payments Upon Termination or Change-in-Control

    Potential Payments Upon Termination or Change-in-Control Pursuant to applicable rules of the SEC, this section, including the tables below, summarizes the estimated payments and other benefits that each Named Executive Officer would be eligible to receive if his or her employment had terminated on December 31, 2023, under the circumstances set forth below.

  142. John T.C. Lee

    John T.C. Lee Pursuant to the terms of Dr. Lee’s employment agreement dated as of November 18, 2019, Dr. Lee is entitled to receive a base salary and to participate in the Company’s annual cash incentive program and long-term equity incentive plan. From time to time in its sole discretion, our Compensation Committee may review and adjust Dr. Lee’s base salary, target compensation goal for the annual cash incentive program, and target award for the long-term equity incentive plan. Dr. Lee’s employment agreement provides for a term that is at-will, with termination upon death or disability or at the election of Dr. Lee or the Company. Under the employment agreement, and consistent with applicable law, on any termination of employment, Dr. Lee is entitled to: (i) any unpaid base salary through the employment end date, (ii) accrued, vested benefits under the Company’s benefit plans and programs and pursuant to any equity award agreements relating to awards under the current or any future Company equity incentive plan, (iii) any accrued but unused vacation, and (iv) any unreimbursed expenses incurred through the employment end date in accordance with the Company’s expense reimbursement policies. In the event that Dr. Lee’s employment is terminated by the Company without cause (as defined below) or is terminated by Dr. Lee for good reason (as defined below), he is entitled to: (i) continuation of base salary for 18 months, (ii) a lump sum equal to 1.5 times the annual amount of his target cash incentive compensation for which he is eligible, (iii) any cash incentive compensation earned for the calendar year preceding his termination but not yet paid, and (iv) to the extent that he elects to continue coverage, payment by the Company of premiums for medical, vision, and dental insurance coverage under COBRA for a period of 18 months, less the premium contribution paid by similarly situated employees. In the event that Dr. Lee’s employment is terminated by the Company without cause, or is terminated by Dr. Lee for good reason, within 24 months after a change-in-control (as defined in his employment agreement), he is entitled to: (i) a lump sum payment equal to three times his annual base salary, (ii) a lump sum payment equal to three times the annual amount of his target cash incentive compensation, (iii) any cash incentive compensation earned for the calendar year preceding his termination but not yet paid, (iv) a prorated portion of his then-current year’s target cash incentive compensation, and (v) to the extent that he elects to continue coverage, payment by the Company of its usual share of premiums for medical, vision, and dental insurance coverage under COBRA during the period of time Dr. Lee is entitled to elect such coverage under COBRA, and after the end of the COBRA continuation period, if Dr. Lee continues to pay the premium that would be charged for COBRA coverage, he may continue such insurance coverage until the end of the 36 month period following his employment termination date on the same terms as if COBRA coverage were still in effect and the Company will continue to pay the Company’s usual share of such premiums. In the event such payments are determined to be subject to an excise tax imposed by Section 4999 of the Internal Revenue Code, such payments will be payable in full or, if applicable, reduced so that no portion of the payments is subject to the excise tax, whichever of the foregoing amounts results in receipt by Dr. Lee on an after-tax basis of the greater amount, taking into account all applicable taxes, including the penalty tax. Dr. Lee is not entitled to any gross-up payment for any such excise tax due. In the event Dr. Lee’s employment is terminated due to death or disability, he (or his estate) is entitled to: (i) any cash incentive compensation earned for the calendar year preceding his termination but not yet paid and (ii) a prorated portion of his then-current year’s target cash incentive compensation. Dr. Lee’s employment agreement contains non-competition provisions that provide that he may not, during the term of his employment and for one year after termination of employment, engage in any competitive

  143. John T.C. Lee

    | MKS INSTRUMENTS, INC. | 2024 PROXY STATEMENT | 61 |

  144. John T.C. Lee

    business or activity. In addition, he may not, during the term of employment and for two years after the termination of employment: (i) solicit, hire or otherwise induce any Company employee to terminate his or her employment with the Company, (ii) solicit or hire any of our suppliers, joint ventures, research partners or customers for the purpose of competing with the Company, (iii) encourage any of such persons or entities not to enter into a business relationship with the Company or interfere with the relationship between the Company and such persons or entities, or (iv) sell to any of the Company’s customers any products of the types sold by the Company with respect to which products he had material dealings in the performance of his duties within the period two years prior to his termination. Any equity awarded to Dr. Lee under the current or any future Company equity incentive plan that is unvested as of Dr. Lee’s termination of employment date will be subject to accelerated vesting if and to the extent provided in the equity award agreements governing the award. Dr. Lee has entered into time-based RSU agreements; performance-based RSU agreements subject to Adjusted EBITDA, which we refer to as Adjusted EBITDA RSU agreements; and a performance-based RSU agreement subject to rTSR, which we refer to as the rTSR RSU agreement. In the case of the time-based RSU agreements and the Adjusted EBITDA RSU agreements, if Dr. Lee is terminated without cause or resigns with good reason within 24 months following a change-in-control (as defined in the applicable RSU agreements), the RSU agreements provide for full acceleration of vesting of all RSUs, provided, that, in the case of the Adjusted EBITDA RSU Agreements, if the RSUs are still subject to performance criteria, only the target number of RSUs will vest. In the case of the rTSR RSU agreement, if the RSUs are still subject to performance criteria at the time of the change-in-control, the RSUs will be converted into time-based RSUs, which we refer to as Converted RSUs, based on actual performance, using the per share price paid to holders of our Common Stock in connection with the change-in-control as the “end price” for purposes of determining rTSR. If the acquiring entity refuses to assume the Converted RSUs, the rTSR RSU agreement provides for full acceleration of vesting of all Converted RSUs. If the acquiring entity assumes the Converted RSUs and Dr. Lee is terminated without cause or resigns with good reason within 24 months following the change-in-control, the rTSR RSU Agreement provides for full acceleration of vesting of all RSUs. The RSU agreements for Dr. Lee also provide for full acceleration of vesting of all shares (or, in the case of performance-based RSUs that are still subject to performance criteria, the actual number of RSUs to vest based upon satisfaction of performance criteria) upon retirement, death or disability, or a pro rata portion of such shares and performance-based RSUs upon early retirement. Retirement, in this context, means a voluntary termination of employment by Dr. Lee after he is at least age 65 and has at least 10 years of service with us, and early retirement, in this context, means a voluntary termination of employment by Dr. Lee after he is at least age 60 and has at least 15 years of service with us. For purposes of the foregoing description of benefits under the employment agreement with Dr. Lee, “cause” will exist if Dr. Lee: (i) commits a felony or engages in fraud, misappropriation or embezzlement, (ii) knowingly fails or refuses to perform his duties in a material way and either the failure or refusal cannot reasonably be cured (as determined by the Company in its reasonable judgment) or he fails to effect a cure within 10 days after the Company notifies him in writing of the failure or refusal, (iii) knowingly causes, or knowingly creates a serious risk of causing, material harm to the Company’s business or reputation or (iv) breaches, in a material way, his employment agreement, the confidential information agreement or any other material agreement between him and the Company, and either the breach cannot be cured (as determined by the Company in its reasonable judgment) or he fails to effect a cure within 10 days after the Company notifies him in writing of the breach. For purposes of the foregoing description of benefits under the employment agreement with Dr. Lee, subject to compliance with certain procedural requirements, “good reason” for Dr. Lee to resign will exist if, without his express written consent: (i) the Company materially reduces his position, duties, title, reporting relationship, authorities or responsibilities, (ii) the Company reduces his then-current base salary or target bonus, (iii) the Company changes his principal place of work to a location more than 50 miles from his then-current principal place of work, or (iv) the Company breaches, in a material way, his employment agreement or any other material agreement between him and the Company. Under the RSU agreements for Dr. Lee entered into prior to February 2023, “cause” means conviction for the commission of a felony, willful failure by him to perform his responsibilities to the Company, or willful misconduct

  145. John T.C. Lee

    | MKS INSTRUMENTS, INC. | 2024 PROXY STATEMENT | 62 |

  146. John T.C. Lee

    by him. Subject to compliance with certain procedural requirements, “good reason” under these RSU agreements means voluntary separation from service within 90 days following (i) a material diminution in position, duties, and responsibilities from those described in his employment agreement, (ii) a material reduction in his base salary (other than as part of a general salary reduction program affecting senior executives), (iii) a material reduction in the aggregate value of his pension and welfare benefits from those in effect prior to the change-in-control (other than as proportionate to the reductions applicable to other senior executives pursuant to a cost-saving plan that includes all senior executives), (iv) a material breach of any provision of the employment agreement by the Company, or (v) the Company’s requiring him to be based at a location causing a one-way commute in excess of 60 miles from his primary residence. Under the RSU agreements for Dr. Lee that were entered into beginning in February 2023, cause will exist if Dr. Lee (i) commits a felony or engages in fraud, misappropriation, or embezzlement, (ii) knowingly fails or refuses to perform his duties in a material way and, to the extent that the Company determines such failure or refusal can reasonably be cured, fails or refuses to effect a cure within 10 days after the Company notifies him in writing of the failure or refusal, (iii) knowingly causes, or knowingly creates a serious risk of causing, material harm to the Company’s business or reputation, or (iv) breaches, in a material way, his employment agreement, the confidential information agreement or any other agreement between him and the Company and, to the extent that the Company determines such breach can reasonably be cured, fails or refuses to effect a cure within 10 days after the Company notifies him in writing of the breach. Subject to compliance with certain procedural requirements, “good reason” for Dr. Lee to resign will exist under these RSU agreements if, without his express written consent: (i) the Company materially reduces his position, duties, or responsibilities, (ii) the Company reduces his then-current base salary, or (iii) the Company changes such his principal place of work to a location more than 50 miles from his then-current principal place of work.

  147. Potential Payments Upon Termination or Change-in-Control Table — John T.C. Lee

    Potential Payments Upon Termination or Change-in-Control Table — John T.C. Lee The following table sets forth the estimated benefits that Dr. Lee would have been entitled to receive upon termination of his employment effective December 31, 2023:

  148. Potential Payments Upon Termination or Change-in-Control Table — John T.C. Lee

    | Termination Circumstance | Cash Severance(1) | Value of Accelerated Unvested Equity | Benefits Continuation | Total | | Termination by the Company Without Cause | $3,531,174 | $- | $36,424(2) | $3,567,598 | | Resignation for Good Reason | $3,531,174 | $- | $36,424(2) | $3,567,598 | | Voluntary Termination or Retirement | $324,924 | $11,667,672(3) | $- | $11,992,596 | | Death or Disability | $1,512,424 | $11,667,672(3) | $- | $13,180,096 | | Within 24 Months Following a Change-in-Control: | | | | | | • Termination by the Company Without Cause | $7,924,924 | $11,667,672(4) | $72,848(5) | $19,665,444 | | • Resignation for Good Reason | $7,924,924 | $11,667,672(4) | $72,848(5) | $19,665,444 |

  149. Potential Payments Upon Termination or Change-in-Control Table — John T.C. Lee

    | (1) For termination by the Company without cause or resignation for good reason, reflects continuation of base salary for 18 months, a lump sum equal to 1.5 times the annual amount of his target cash incentive compensation, and accrued but unused vacation that we would be required to pay out upon a termination under applicable law and Dr. Lee’s employment agreement. For each of voluntary termination and retirement, reflects accrued but unused vacation. For death and disability, reflects a prorated portion of his then-current year’s target cash incentive compensation and accrued but unused vacation. For termination by the Company without cause or resignation for good reason, each within 24 months following a change in control, reflects a lump sum payment equal to three times his annual base salary, a lump sum payment equal to three times the annual amount of his target cash incentive compensation, a prorated portion of his then-current year’s target cash incentive compensation, and accrued but unused vacation. |

  150. Potential Payments Upon Termination or Change-in-Control Table — John T.C. Lee

    | (2) Reflects our estimated cost for continuation of medical, dental, and vision coverage for 18 months, assuming the termination or resignation occurred on December 31, 2023. |

  151. Potential Payments Upon Termination or Change-in-Control Table — John T.C. Lee

    | (3) Upon retirement, death, or disability, RSUs fully vest, subject to achievement of any remaining performance criteria. The stated value assumes the retirement, death, or disability occurred on December 31, 2023 and assumes the target number of unvested performance-based RSUs vested. |

  152. Potential Payments Upon Termination or Change-in-Control Table — John T.C. Lee

    | (4) The unvested time-based RSUs fully vest and the target number of unvested performance-based RSUs vest. |

  153. Potential Payments Upon Termination or Change-in-Control Table — John T.C. Lee

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  154. Potential Payments Upon Termination or Change-in-Control Table — John T.C. Lee

    | (5) Reflects our estimated cost for continuation of medical, dental, and vision coverage for 36 months, assuming the termination or resignation occurred on December 31, 2023. |

  155. Potential Payments Upon Termination or Change-in-Control Table — Other Named Executive Officers

    Potential Payments Upon Termination or Change-in-Control Table — Other Named Executive Officers The following table sets forth the estimated benefits that Mr. Bagshaw, Ms. Burke, Mr. Henry, and Mr. Schreiner would have been entitled to receive upon termination of his or her employment effective December 31, 2023:

  156. Potential Payments Upon Termination or Change-in-Control Table — Other Named Executive Officers

    | Termination Circumstance | Cash Severance(1) | Value of Accelerated Unvested Equity | Benefits Continuation | Total | | Termination by the Company Without Cause | | | | | | Seth H. Bagshaw | $1,099,935 | $- | $24,283(2) | $1,124,218 | | Kathleen F. Burke | $687,245 | $- | $24,283(2) | $711,528 | | David P. Henry | $572,104 | $- | $23,622(2) | $595,726 | | James A. Schreiner | $546,413 | $- | $23,622(2) | $570,035 | | Death or Disability | | | | | | Seth H. Bagshaw | $473,615 | $3,828,725(3) | $- | $4,302,340 | | Kathleen F. Burke | $183,245 | $1,857,669(3) | $- | $2,040,914 | | David P. Henry | $122,104 | $1,489,301(3) | $- | $1,611,405 | | James A. Schreiner | $74,138 | $1,598,866(3) | $- | $1,673,004 | | Voluntary Termination or Retirement | | | | | | Seth H. Bagshaw | $473,615 | $3,828,725(4) | $- | $4,302,340 | | Kathleen F. Burke | $183,245 | $-(4) | $- | $183,245 | | David P. Henry | $122,104 | $-(4) | $- | $122,104 | | James A. Schreiner | $74,138 | $-(4) | $- | $74,138 | | Within 24 Months Following a Change-in-Control: | | | | | | • Termination by the Company Without Cause | | | | | | • Resignation for Good Reason | | | | | | Seth H. Bagshaw | $3,417,319 | $3,828,725(5) | $48,565(6) | $7,294,609 | | Kathleen F. Burke | $1,821,245 | $2,853,550(5) | $36,424(6) | $4,711,219 | | David P. Henry | $1,528,354 | $1,489,301(5) | $35,433(6) | $3,053,088 | | James A. Schreiner | $1,549,997 | $1,598,866(5) | $35,433(6) | $3,184,296 |

  157. Potential Payments Upon Termination or Change-in-Control Table — Other Named Executive Officers

    | (1) For termination by the Company without cause, reflects a lump sum payment equal to 12 months base salary and accrued but unused vacation that we would be required to pay out upon a termination under applicable law and the applicable employment agreement. For each of death, disability, voluntary termination, and retirement, reflects accrued but unused vacation. For termination by the Company without cause or resignation for good reason, each within 24 months following a change in control, reflects a lump sum payment equal to one and one-half times his or her annual base salary (or two times in the case of Mr. Bagshaw), a lump sum payment equal to one and one-half times the annual amount of his or her target cash incentive compensation (or two times in the case of Mr. Bagshaw), a prorated portion of the then-current year’s target cash incentive compensation, and accrued but unused vacation. |

  158. Potential Payments Upon Termination or Change-in-Control Table — Other Named Executive Officers

    | (2) Reflects our estimated cost for continuation of medical, dental, and vision coverage for 12 months, assuming the termination or resignation occurred on December 31, 2023. |

  159. Potential Payments Upon Termination or Change-in-Control Table — Other Named Executive Officers

    | (3) Upon death or disability, RSUs fully vest, subject to achievement of any remaining performance criteria. The stated value assumes the death or disability occurred on December 31, 2023 and assumes the target number of unvested performance-based RSUs vested. |

  160. Potential Payments Upon Termination or Change-in-Control Table — Other Named Executive Officers

    | (4) Upon retirement (as defined in the RSU agreements), RSUs that were outstanding as of December 31, 2023 for Mr. Bagshaw, Ms. Burke, Mr. Henry, and Mr. Schreiner fully vest, subject to achievement of any remaining performance criteria. However, Ms. Burke, Mr. Henry, and Mr. Schreiner did not meet the requirements for retirement as of December 31, 2023. |

  161. Potential Payments Upon Termination or Change-in-Control Table — Other Named Executive Officers

    | (5) The unvested time-based RSUs fully vest and the target number of unvested performance-based RSUs vest. |

  162. Potential Payments Upon Termination or Change-in-Control Table — Other Named Executive Officers

    | (6) Reflects our estimated cost for continuation of medical, dental, and vision coverage for 18 months (or 24 months in the case of Mr. Bagshaw), assuming the termination or resignation occurred on December 31, 2023. |

  163. Potential Payments Upon Termination or Change-in-Control Table — Other Named Executive Officers

    | MKS INSTRUMENTS, INC. | 2024 PROXY STATEMENT | 67 |