Document

DEF 14A 1 ipgphotonicsproxy2022.htm DEF 14A Document

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

(Rule 14a-101)

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of the

Securities Exchange Act of 1934 (Amendment No.__ )


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CHECK THE APPROPRIATE BOX:
¨						Preliminary Proxy Statement
¨						Confidential, For Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
þ						Definitive Proxy Statement
¨						Definitive Additional Materials
¨						Soliciting Material Pursuant to Section 240.14a-12

IPG Photonics Corporation

(Name of Registrant as Specified In Its Charter)

(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)


Payment of Filing Fee (Check all boxes that apply):
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¨						Fee computed on table in exhibit required by Item 25(b) per Exchange Act Rules 14a-6(i)(1) and 0-11




2022 Annual Letter
It has been a seminal year for IPG in many different ways. I am pleased to report that we delivered record revenue in 2021 despite the continued uncertainty in the global operating environment, supply chain challenges and the COVID-19 outbreaks around the world. We also successfully navigated a CEO transition in 2021 and I feel extremely privileged that the Board chose me as the next CEO of this great company. We were deeply saddened by the passing of IPG founder and former CEO Dr. Valentin P. Gapontsev. It was a tremendous loss for IPG and the laser photonics world, but we are proud to continue to implement his strategic vision and successful innovations. We are executing on our strategy to achieve a better balance in our business by pursuing profitable growth opportunities in electric vehicle applications, renewable energy, handheld welding, medical markets and ultrafast lasers, diversifying IPG away from the highly competitive high power cutting market in China. We delivered excellent results as our revenue increased 22% year over year in 2021, surpassing the previous record revenue delivered in 2018. We benefited from improved demand for our lasers in Europe, North America and China, driven by increased economic activity, fiber laser adoption and regionalization of supply chains that is driving local investments in new equipment and manufacturing capacity. We saw strong growth in welding, marking, 3D printing, cleaning and medical applications. Sales of high power lasers benefited from an increase in order volumes in cutting applications in Europe and North America. Our high power lasers and optical heads can deliver significant productivity improvements, electrical efficiency, flexibility and ease of use and integration as well as lowest total cost of ownership and global support, unmatched by other lasers and non-laser tools. Our welding and foil cutting solutions are widely accepted as a standard tool in the manufacturing of electric vehicles batteries around the world. Furthermore, I would like to highlight our exceptional growth in welding this year, driven by higher demand for AMB lasers used in EV battery manufacturing and the introduction of LightWELD, our handheld welder. Both products are examples of IPG's focus on innovation and ability to deliver solutions to our customers that expand our total available market. We were also pleased with the growth we are seeing in medium power, pulsed and QCW lasers, which are primarily driven by higher demand in emerging growth applications. Our medical business delivered record revenue in 2021 as our gold standard urology lasers and disposable fibers that represent a significant recurring revenue opportunity continued to gain acceptance.


						Delivered record revenue in 2021 despite the continued uncertainty in the global operating environment

						Focus on innovation and ability to deliver solutions to our customers that expand our total available market

2022 Annual Letter


IPG is well positioned to benefit from global macro trends such as automation and miniaturization, as well as increasing attention on sustainability, renewable energy and energy efficiency. We expect that electric vehicle and solar cell manufacturing will benefit from multi-year investment cycles, supporting IPG sales into these markets. Focus on sustainability and efficiency as well as some recent energy shortages and higher energy prices are driving an increased interest for our ECO lasers that provide wall-plug efficiency of greater than 50% and can help to meaningfully reduce the environmental impact and energy costs for medium and large industrial manufacturers. We remain committed to our focus on innovation and further aligning our R&D, market development, sales and technical support functions. This will allow us to continue to provide new leading-edge solutions for our customers, helping drive efficiency and productivity in their operations and making our fiber laser technology the tool of choice in many different markets. Turning to this year, we are of course following the tragic situation in Ukraine closely and hope for a swift end to this conflict. To be clear, our business and ability to fulfil orders are not heavily reliant on our supply chain from Russia. However, we are taking all necessary precautions to mitigate potential risks posed by sanctions. In early March, we announced that we will be executing on our contingency plans to increase production of key optical and other components in the U.S. and Europe and reduce our reliance on Russian operations. These efforts are well underway. Importantly, our strong cash flow generations and balance sheet allow us to support R&D investments and capital expenditures, focusing on long-term objectives, diversifying our business with new products, finding new markets, driving innovations to maintain and increase margins and to return capital to shareholders through share repurchases. We finished the year with approximately $1.5 billion net cash and ample liquidity, spent $140 million on research and development and $123 million on capital expenditures. We also repurchased $135 million worth of stock. The IPG Board authorized $200 million in additional share repurchases. Including this new program, the Board has authorized more than half a billion dollars in stock repurchases over the last three years. Our strong balance sheet also provides us with flexibility in responding to disruptions and uncertainty in the operating environment and allows us to emerge from these challenges a stronger company.


EUGENE SCHERBAKOV, PH.D. Chief Executive Officer April 1, 2022

2 NOTICE OF 2022 ANNUAL MEETING AND PROXY STATEMENT

Notice of Annual Meeting of Stockholders



DATE AND TIME May 24, 2022 10:00 AM (Eastern Time)	LOCATION IPG Photonics Corporation 50 Old Webster Road Oxford, Massachusetts 01540	WHO CAN VOTE Only stockholders of record at the close of business on April 1, 2022 may vote at the Annual Meeting

Voting Items

Proposals

Board Vote Recommendation

For Further Details

Election of ten directors named in this proxy statement

ü FOR each director nominee

Page 11

Ratification of the appointment of Deloitte & Touche LLP as our independent registered public accounting firm for 2022

ü FOR

Page 61

Stockholders will also transact any other business that may properly come before the meeting.

You may vote on these matters in person or by proxy. Whether or not you plan to attend the Annual Meeting, we ask that you promptly vote your shares.

By order of the Board of Directors
IPG PHOTONICS CORPORATION

ANGELO P. LOPRESTI
Secretary

April 1, 2022

Oxford, Massachusetts

How to Vote



INTERNET Go to www.investorvote.com/ipgp or scan the QR code contained in the attached proxy card	TELEPHONE 1-800-652-VOTE (8683)	MAIL Mark, sign, date and promptly mail the enclosed proxy card in the postage-paid envelope



As permitted by the rules of the United States Securities and Exchange Commission (the “SEC”), we are making this Proxy Statement and Annual Report on Form 10-K available to stockholders electronically via the Internet at investor.ipgphotonics.com. On or about April 14, 2022, we will mail to most of our stockholders a notice (the “Notice”) containing instructions on how to access this Proxy Statement and our Annual Report and to vote via the Internet or by telephone. Other stockholders, in accordance with their prior requests, will receive e-mail notification of how to access our proxy materials and vote via the Internet or by telephone, or will be mailed paper copies of our proxy materials and a proxy card on or about April 14, 2022.

Proxy Statement Summary

This summary highlights information available within our proxy statement. You should consider all of the information available in this proxy statement (the "Proxy Statement") and our Annual Report on Form 10-K for fiscal year 2021 ("Annual Report") filed with the SEC on February 22, 2022, prior to voting your shares. Page references are supplied to help you find further information in this Proxy Statement. In this Proxy Statement, the terms "IPG", the "Company", "we" and "our" refer to IPG Photonics Corporation.


Company Overview

IPG Photonics Corporation is a world leader in fiber laser technology, enabling greater precision, higher productivity and more flexible production for industrial applications and other diverse end markets. The Company has a vertically-integrated business model, producing key components of its technology in-house, enabling more powerful and efficient solutions with rapid ongoing cost reduction. Within industrial applications, automated production and miniaturization trends are driving replacement of mechanical machine tools with IPG laser-based solutions. In other end markets, IPG is introducing new products that increase our addressable market while diversifying end-market exposure.


Performance Highlights

IPG delivered record revenue in 2021 despite the continued uncertainty in the global operating environment as well as a softer demand and increased competition in the cutting market in China, particularly in the second half of the year. Revenue increased 22% year over year benefiting from growth in Europe, North America and China. We benefited from our focus on new products and opportunities that diversify our revenue and provide a better balance in our business. We improved our margins and generated strong cash flow from operations.

Financial Highlights


NET SALES			OPERATING INCOME

•Materials processing sales accounted for 91% of total revenue and increased 22%, driven by increased sales in welding, marking, 3D printing and cleaning applications. Other applications revenue increased 15% year over year, driven by increased demand for lasers used in medical procedures and advanced applications.

•Gross margin increased to 47.7% in 2021 from 44.9% in 2020, driven by decreased manufacturing costs as a percentage of sales and the absence of additional inventory charges.

•Sales outside of China increased to 69% of our total revenue in the fourth quarter of 2021, showing progress in achieving more geographic balance in our business.

•Sales of emerging growth products contributed 38% of total revenue in the fourth quarter compared to 27% in the fourth quarter last year.

•Strong balance sheet with cash, cash equivalents and short-term investments of $1.5 billion at December 31, 2021.

4 NOTICE OF 2022 ANNUAL MEETING AND PROXY STATEMENT

Proxy Statement Summary


Voting Items



Proposal 1	Election of Ten Directors The Board recommends a vote FOR each director nominee named in this Proxy Statement.
		See page 11

Director Nominees

The following provides summary information about each director nominee for our Board of Directors (the "Board").

Committee Membership

Name and Principal Occupation

Age

Director Since

NCGC

John R. Peeler IND, Non-Executive Chair of the Board

Former Chairman and CEO, Veeco Instruments, Inc.

2012

●

Eugene A. Scherbakov, Ph.D.

Chief Executive Officer

2000

Michael C. Child IND

Senior Advisor, T.A. Associates, Inc.

2000

●

Jeanmarie F. Desmond IND

Former EVP and CFO, DuPont de Nemours, Inc.

2021

●

Gregory P. Dougherty IND

Former CEO, Oclaro, Inc.

2019

●

Eric Meurice IND

Former President, CEO and Chairman, ASML Holding NV

2014

●

Natalia Pavlova

Significant stockholder

2021

Thomas J. Seifert IND

Chief Financial Officer, Cloudflare, Inc.

2014

●

Felix Stukalin

Senior Vice President, Chief Operating Officer

2022

Agnes Tang IND

Partner, Ducera Partners LLC

2022


AC Audit Committee	●	Chair
CC Compensation Committee	●	Member
NCGC Nominating and Corporate Governance Committee
IND Independent director under Nasdaq and SEC rules

Proxy Statement Summary

Board Snapshot


DIRECTOR INDEPENDENCE	BALANCED TENURE	AGE	DIVERSITY


7/10 directors are independent*	8 years Average Tenure	60 years Average Age	30% Female

* Audit, Compensation and Nominating and Corporate Governance Committees are composed entirely of independent directors.

Skills and Experience

Lasers and
Technology

Risk
Management

Financial
Literacy

Executive
Leadership

Global
Business

Other Public
Company Boards

Manufacturing
and Operating

Non-Corporate Experience

Business
Development
and M&A

6 NOTICE OF 2022 ANNUAL MEETING AND PROXY STATEMENT

Proxy Statement Summary

Corporate Governance Highlights



ü Separated roles of Chairman and CEO in May 2021 ü Appointed first non-executive Chair of the Board in October 2021 ü Board policy requires external director candidate pool to include diversity of gender and/or race/ethnicity ü Stockholder proxy access right adopted in March 2019 ü Director majority voting policy adopted in October 2018 ü Supermajority of independent directors and 100% independent Board committees	ü Active Board refreshment: 3 female directors added in last eighteen months; 5 new directors in 4 years ü 60% of Board members were born outside of the U.S.A., bringing international perspectives ü 30% of Board members are women ü Single class of voting stock and no supermajority voting provisions ü Annual election of all directors ü Stockholder right to act by written consent	ü 81% of director compensation at risk based upon stock performance ü Annual Board performance evaluations ü Robust director and executive officer stock ownership guidelines ü Anti-hedging policy applicable to all employees and directors ü Adopted ESG oversight framework to clearly allocate responsibilities among Board and standing committees in February 2022

Stockholder Engagement

We value the views of our stockholders and we believe that building positive relationships with our stockholders is critical to our long-term success. Our investor communications and outreach include quarterly conference calls, follow-up conversations with our investors, periodic site visits, participation in investor conferences, investor sentiment and materiality assessments. Our quarterly conference calls and presentations at investor conferences are open to the public and are available live and as archived webcasts on our website. To help management and the Board understand and consider the issues that matter most to our stockholders, we periodically engage with our stockholders on a range of topics including performance, executive compensation, governance and sustainability matters; our Board has been responsive to feedback it has received. Following investor requests for greater diversity in director recruitment, the Board added three female members to the Board over the last 18 months and the Board formally adopted a written policy to require external director candidate pools to include candidates with diversity of gender and/or race/ethnicity.

Governance Features of our Executive Compensation Program



PRACTICES WE EMPLOY						PRACTICES WE AVOID

ü Align our officer pay with performance ü Balance annual and long-term incentives ü Use long-term incentives to link executive pay to company performance ü Cap incentive award payouts ü Maximize stockholder value while mitigating risk ü Independent compensation consultant ü Robust stock ownership requirements ü Clawbacks on executive compensation						û No guaranteed annual bonuses û No SERP or pension û No excise tax gross-ups û No excessive perquisites û Prohibit hedging of Company stock û No severance for “cause” terminations û No single-trigger change in control provisions û No stock option repricing without stockholder approval û Pledging of Company stock is limited

Proxy Statement Summary

2021 Executive Compensation Highlights

As further discussed in Compensation Discussion and Analysis starting on page 37, the guiding principles of our executive compensation philosophy are pay-for-performance, accountability for annual and long-term performance, alignment with stockholders’ interests, and providing competitive pay to attract and retain executives. The 2021 compensation program for our named executive officers ("NEOs") has three primary components: annual base salary, annual cash incentives and long-term equity incentives. The annual cash incentive amounts are presented based on actual amounts earned under the annual incentive plan for services rendered in 2021. Figures below for Dr. Scherbakov reflect his compensation as CEO on an annualized basis for 2021. He assumed the role in May 2021. Figures below exclude the former CEO, Dr. Valentin Gapontsev, who did not receive equity grants due to his significant ownership of Company stock.

Fixed

At-risk

Base Salary

Annual Cash Incentive

Long-Term Equity Incentives

Pay Mix

CEO

OTHER NEOs

CEO

OTHER NEOs

CEO

OTHER NEOs

PSUs (Performance Based)
&
RSUs (Service Based)

Performance

•Executive base salaries increased modestly in 2021 after remaining stable since January 2018

•Record annual revenue led to performance in excess of targets for 2021, despite macroeconomic uncertainty and challenges from ongoing COVID-19 pandemic

•PSUs awarded in 2018 and 2019 based on relative TSR did not result in payouts upon vesting in March 2021 and 2022, respectively

Objectives

•Provide a competitive fixed component to attract and retain talented and experienced executives

•Variable cash compensation opportunity is based upon annual net sales and profitability against threshold, target and maximum performance goals

•Additional compensation opportunities are based upon individual performance

•Align interests of our executives and stockholders by motivating executive officers to increase long-term stockholder value

•PSU awards provide incentives and are earned based on IPG’s total stockholder return relative to a comparable stock index and an operating metric based upon operating cash flow

•Service-based RSUs awards vest over four years providing long-term retention and alignment to stockholder value

8 NOTICE OF 2022 ANNUAL MEETING AND PROXY STATEMENT

Proxy Statement Summary

Compensation Alignment with Stockholder Interests and Performance


•Annual cash incentive payouts are capped and have challenging performance goals linked to key financial performance metrics •Long-term equity incentives are aligned with long-term stockholder value creation •Over 80% of current NEO compensation in 2021 was performance based •Executives exceed stock ownership guidelines, aligning with interests of stockholders •After considering the results of the 2020 vote, the Compensation Committee determined to maintain its pay philosophy and practices.						Say-on-pay approval during last stockholder vote in 2020



Proposal 2	Ratify Deloitte & Touche LLP as our Independent Registered Public Accounting Firm for 2022 The Board recommends a vote FOR this proposal.
		See page 61

The Audit Committee has sole authority to appoint and replace the Company’s independent registered public accounting firm, which reports directly to the Audit Committee, and is directly responsible for its compensation and oversight of its work. The Audit Committee conducted its annual evaluation of Deloitte & Touche LLP and, after assessing the performance and independence of Deloitte & Touche LLP, the Audit Committee concluded that the best course of action was to reappoint Deloitte & Touche LLP as our independent external auditor for 2022.

We are asking you to ratify this appointment. If stockholders fail to ratify the appointment, the Audit Committee will consider it a directive to consider other accounting firms for the subsequent year.

Fees Paid to Deloitte & Touche. The fees for services provided by Deloitte & Touche LLP, member firm of Deloitte Touche Tohmatsu, and their respective affiliates, to the Company were:


	Fees
Fee Category	2021		2020
Audit fees	$	2,230,305	$	2,247,738
Audit-related fees	—		—
Tax fees	235,195		145,000
All other fees	—		—
Total Fees	$	2,465,500	$	2,392,738

In 2021 and 2020, the percentage of total fees paid to our independent registered public accounting firm for audit fees were 90% and 94%, respectively.

Table of Contents


			Page
202 2 ANNUAL LETTER			1
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS			3
PROXY STATEMENT SUMMARY			4

PROPOSAL 1: ELECTION OF TEN DIRECTORS			11

Director Qualifications			11
Director Nominees			13
Board Refreshment and Composition			23
Board Roles and Responsibilities			25
Board Structure			28
Standing Committees and Board Committee Membership			30
Board Practices, Policies and Processes			32
Director Compensation			35
Executive Compensation
Compensation Committee Report			39
Compensation Discussion and Analysis			40
2021 Compensation of Named Executive Officers			43
Executive Compensation Tables			53

PROPOSAL 2 : RATIFY DELOITTE & TOUCHE LLP AS OUR INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR 20 2 2			61

Audit Committee Report			63
Common Stock Ownership			64
Questions and Answers About the Meeting and Voting			66
Additional Information			70



This Proxy Statement contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and we intend that such forward-looking statements be subject to the safe harbors created thereby. For this purpose, any statements contained in this Proxy Statement except for historical information are forward-looking statements. Without limiting the generality of the foregoing, words such as “may,” “will,” “expect,” “believe,” “anticipate,” “intend,” “could,” “estimate,” or “continue” or the negative or other variations thereof or comparable terminology are intended to identify forward-looking statements. The forward-looking statements included herein are based on current expectations of our management based on available information and involve a number of risks and uncertainties, all of which are difficult or impossible to accurately predict and many of which are beyond our control. As such, our actual results may differ significantly from those expressed in any forward-looking statements. Factors that may cause or contribute to such differences include, but are not limited to, those discussed in more detail in the section titled “Risk Factors” and elsewhere in our Annual Report and other filings with the SEC. We undertake no obligation to revise the forward-looking statements contained herein to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.

10 NOTICE OF 2022 ANNUAL MEETING AND PROXY STATEMENT



Proposal 1			Election of Ten Directors The Board of Directors recommends a vote FOR each director nominee named in this Proxy Statement.


Director Qualifications

The Nominating and Corporate Governance Committee (the "NCGC") is responsible for identifying and evaluating nominees for director and for recommending to the Board a slate of nominees for election at the Annual Meeting. The NCGC has recommended, and the Board has approved, the following nominees for terms expiring at the annual meeting to be held in 2023, until a successor is elected and qualified or until his or her earlier death, resignation or removal and, unless otherwise marked, a proxy will be voted for such nominees: Mr. Peeler, Dr. Scherbakov, Mr. Child, Ms. Desmond, Mr. Dougherty, Mr. Meurice, Ms. Pavlova, Mr. Seifert, Mr. Stukalin and Ms. Tang. All of the director nominees set forth in our proxy card have consented to being named in this Proxy Statement and to serving if elected. For more information regarding the nominees for director, see Director Nominees below.

In considering each director nominee and the composition of the Board as a whole, the NCGC evaluates members based on their expertise and diverse perspectives, experiences, qualifications, attributes and skills because the NCGC believes that these attributes enable a director nominee to make significant contributions to the Board, IPG and our stockholders.

The director nominees have a mix of various skills, qualifications and attributes, some of which are listed in the table below, that enable the Board to provide effective oversight as it strives to advance our strategies and deliver returns to stockholders.

Lasers and Technology

We have sought directors with management and operational experience in the industries in which we compete. For example, in 2019 we added a director with expertise in optical and electronics components, and telecommunications products. As a diversified technology, science-based company, directors with technology backgrounds understand the Company’s technology platforms and the importance of investing in new technologies for future growth.

Financial Literacy

Knowledge of finance or financial reporting; experience with debt/capital market transactions and/or mergers and acquisitions strengthen the Board’s oversight of financial reporting and internal controls. Financial metrics are used to measure our performance. All directors must understand finance and financial reporting processes. Two of the Audit Committee members qualify as “audit committee financial experts.”

Global Business

Global business experience is critical to the Company’s international operations and growth with 80% of sales from outside the U.S. in 2021. Knowledge of Asian and European business practices are valuable to understanding our business and strategy.

Manufacturing
and Operating

As a vertically-integrated company, manufacturing experience and customer service on a global scale are important to understanding the operations and capital needs of the Company.

Business Development
and M&A

We have used and will continue to use acquisitions to achieve our strategic goals. Directors with experience in business development and mergers and acquisitions provide valuable perspectives regarding process, due diligence, risk assessment and integration of potential partners.

Risk Management

In light of the Board’s role in overseeing risk management and understanding the most significant risks facing the Company, including cybersecurity risk, we continue to require directors with experience in risk management and oversight.

Director Qualifications

Executive Leadership

Significant leadership experience, including services as a CEO, senior executive, division president or functional leader within a complex organization enhances the Board’s leadership role.

Other Public Company Boards

Directors with current or recent membership on other public company boards provide valuable perspectives in many areas including operations, strategy, governance and compensation.

Non-Corporate Experience

Experience from backgrounds beyond the executive suite, including non-corporate backgrounds such as non-profit organizations, government and academia.

Skills and Experience

Peeler

Scherbakov

Child

Desmond

Dougherty

Meurice

Pavlova

Seifert

Stukalin

Tang

Lasers and Technology

●

Financial Literacy

●

Global Business

●

Manufacturing
and Operating

●

Business Development
and M&A

●

Risk Management

●

Executive Leadership

●

Other Public
Company Boards

●

Non-Corporate Experience

●

Tenure and Independence

Years on Board

Independent

●

Demographics

Age

Gender Identity

Born Outside of U.S.A.

●

White

●

Asian

●

12 NOTICE OF 2022 ANNUAL MEETING AND PROXY STATEMENT


Director Nominees

John R. Peeler

Non-Executive Chair of the Board

Mr. Peeler became our non-executive Chair of the Board on October 29, 2021. Mr. Peeler was appointed to the Board in 2012 and served as the Lead Independent Director from 2017 to 2021. Mr. Peeler has been acting CEO of Jumplights Corp., a producer of LED horticultural lighting, since June 2021. He was previously the Chief Executive Officer of Veeco Instruments Inc. (“Veeco”) from July 2007 until September 2018, and Chairman or Executive Chairman of its board of directors from May 2012 until May 2020. Veeco is a developer and manufacturer of MOCVD, molecular beam epitaxy, ion beam and other advanced semiconductor processes equipment. He was Executive Vice President of JDS and President of the Communications Test & Measurement Group of JDS, which he joined upon the closing of JDS’s merger with Acterna, Inc. in August 2005. Before joining JDS, Mr. Peeler served as President and Chief Executive Officer of Acterna. In March 2021, Mr. Peeler joined the board of WaveArray Antifouling Systems, LLC, a producer of antifouling solutions, and in June 2021, he joined the board of Jumplights Corp. He has a B.S. and M.E. in Electrical Engineering from the University of Virginia.

KEY ATTRIBUTES, EXPERIENCE AND SKILLS

Over the course of his career, Mr. Peeler has managed several high-growth technology companies. In addition, he has developed managerial leadership skills through his former position as Chief Executive Officer of Veeco, a publicly-traded company with substantial international operations. His managerial positions have provided him with in-depth knowledge of the service needs of customers in demanding markets, including semiconductor capital equipment, various manufacturing models, research and development, marketing and sales. In these roles, he has also been responsible for attracting and incentivizing executives on his team. These experiences have provided him important insights in support of his positions as non-executive Chair and a member of the Compensation Committee and the NCGC.

AGE:

DIRECTOR SINCE:

2012

COMMITTEES:

Compensation
Committee,
NCGC

Lasers and Technology

Financial Literacy

Global
Business

Manufacturing
and Operating

Business
Development
and M&A

Risk
Management

Executive
Leadership

Other Public
Company
Boards

Director Nominees

Eugene A. Scherbakov, Ph.D.

Chief Executive Officer and Director

Dr. Scherbakov became the Chief Executive Officer in May 2021. He has been a director since 2000. He previously served as Chief Operating Officer from February 2017, Managing Director of IPG Laser GmbH, our German subsidiary, since August 2000 and Senior Vice President-Europe since February 2013. He served as the Technical Director of IPG Laser from 1995 to August 2000. From 1983 to 1995, Dr. Scherbakov was a senior scientist in fiber optics and head of the optical communications laboratory at the General Physics Institute, Russian Academy of Science in Moscow. Dr. Scherbakov graduated from the Moscow Physics and Technology Institute with an M.S. in Physics. In addition, Dr. Scherbakov attended the Russian Academy of Science in Moscow, where he received a Ph.D. in Quantum Electronics from its Lebedev Physics Institute and a Dr.Sci. degree in Laser Physics from its General Physics Institute.

KEY ATTRIBUTES, EXPERIENCE AND SKILLS

As the Chief Executive Officer, Dr. Scherbakov reports to the Board and has responsibility for managing the general business and affairs of the Company. Previously as Managing Director of IPG Laser GmbH, which produces a large volume of our products and is the source of many developments in products, technology and applications, he developed extensive knowledge of the Company’s business. He applies his knowledge and experience across our many international branches. The leadership and operational expertise of Dr. Scherbakov have contributed to IPG increasing production, lowering manufacturing costs, managing risk and maintaining high margins compared to our industry peers. He also has extensive technological knowledge of fiber lasers, their components and manufacturing processes. His long-term service as an executive officer of the Company provides the Board with a detailed understanding of the Company’s operations, sales and customers.

AGE:

DIRECTOR SINCE:

2000

COMMITTEES:

None

Lasers and Technology

Financial Literacy

Global
Business

Manufacturing
and Operating

Business
Development
and M&A

Risk
Management

Executive
Leadership

14 NOTICE OF 2022 ANNUAL MEETING AND PROXY STATEMENT

Director Nominees

Michael C. Child

Independent Director

Since July 1982, Mr. Child has been employed by TA Associates, Inc., a private equity investment firm, where he currently serves as Senior Advisor and, prior to January 2011, he was Managing Director. Mr. Child served previously on the boards of Finisar Corporation, a developer and manufacturer of optical subsystems and components for networks, Eagle Test Systems, Inc., a manufacturer of semiconductor test equipment, and Ultratech Inc., a developer and manufacturer of advanced packaging lithography systems and laser processing technologies. Mr. Child holds a B.S. in Electrical Engineering from the University of California at Davis and an M.B.A. from the Stanford University Graduate School of Business. From September 2011 until December 2015, Mr. Child was a Lecturer at the Stanford University Graduate School of Business.

KEY ATTRIBUTES, EXPERIENCE AND SKILLS

Mr. Child is an established and experienced investor, including in technology companies, from his three decades of experience at TA Associates, Inc. Over the course of his career, he has overseen numerous investments and sales of portfolio companies, and served on the boards of many public and private companies. Through his experiences, he has gained valuable knowledge in the management, operations and finance of technology growth companies.

AGE:

DIRECTOR SINCE:

2000

COMMITTEES:

NCGC

Financial Literacy

Global
Business

Manufacturing
and Operating

Business
Development
and M&A

Risk
Management

Other Public
Company
Boards

Director Nominees

Jeanmarie F. Desmond

Independent Director

From April 2019 to February 2020, Ms. Desmond was the Executive Vice President and Chief Financial Officer of DuPont de Nemours, Inc., a global multi-industry specialty solutions company (“DuPont”). Ms. Desmond previously served as Vice President and Co-Controller for DuPont from August 2017 to April 2019, and as finance leader for the Specialty Products division following the merger of DuPont with Dow Chemical. Ms. Desmond served in various leadership roles within DuPont in her 30-year career with the company. She also serves on the board and is treasurer of Delaware Prosperity Partnership, a public-private partnership overseeing economic development in Delaware. Since 2020, she has served on the board of Trinseo S.A., a materials solutions provider and a manufacturer of plastics, latex binders and synthetic rubber. In October 2021, she joined the board of Sylvamo Corporation, a global producer of uncoated paper. Ms. Desmond earned a B.S. in Accounting from Mt. St. Mary’s University and is a certified public accountant (inactive).

KEY ATTRIBUTES, EXPERIENCE AND SKILLS

Ms. Desmond brings to the Board substantial finance and accounting experience and extensive experience in technology-driven companies. Her long management experience in a number of key strategic areas including finance leadership and operations financial planning and analysis, tax, internal audit, accounting controls, risk management, mergers and acquisitions, investor relations and public-private partnership brings depth to the skillsets of the Board.

AGE:

DIRECTOR SINCE:

2021

COMMITTEES:

Audit Committee

DIRECTORSHIP AT OTHER PUBLIC COMPANY:

Sylvamo Corporation and Trinseo S.A.

Financial Literacy

Global
Business

Manufacturing
and Operating

Business
Development
and M&A

Risk
Management

Executive
Leadership

Other Public
Company
Boards

Non-Corporate Experience

16 NOTICE OF 2022 ANNUAL MEETING AND PROXY STATEMENT

Director Nominees

Gregory P. Dougherty

Independent Director

Mr. Dougherty served as Chief Executive Officer of Oclaro, Inc., a maker of optical components and modules for the long-haul, metro and data center markets, from June 2013 and has served as a director of Oclaro from April 2009, until its December 2018 acquisition. Prior to Oclaro, Mr. Dougherty served as a director of Avanex Corporation, a leading global provider of intelligent photonic solutions, from April 2005 to April 2009. Mr. Dougherty also served as a director of Picarro, Inc., a manufacturer of ultra-sensitive gas spectroscopy equipment using laser-based technology, from October 2002 to August 2013, and as its Interim Chief Executive Officer from January 2003 to April 2004. From February 2001 until September 2002, Mr. Dougherty was the Chief Operating Officer at JDS Uniphase Corporation (“JDS”), an optical technology company. Prior to JDS he was the Chief Operating Officer of SDL, Inc., a maker of laser diodes, from March 1997 to February 2001 when they were acquired by JDS. Mr. Dougherty serves on the boards of directors of Infinera Corporation, a provider of optical transport networking equipment, software and services to telecommunications service providers and others, since January 2019, Fabrinet, a provider of advanced optical packaging and precision optical, electro-mechanical, and electronic manufacturing services to OEMs of complex products, since February 2019, and MaxLinear, Inc., a provider of radio frequency (RF), analog and mixed-signal integrated circuits, since March 2020. Mr. Dougherty earned a B.S. in optics from the University of Rochester.

KEY ATTRIBUTES, EXPERIENCE AND SKILLS

Mr. Dougherty contributes to the Board significant leadership, operations, sales, marketing and general management experience in optics and components for telecommunications and other applications. For over three decades, Mr. Dougherty has worked in the optical and components industry and can provide the Board with insight into the industry and conditions in which the Company operates. Having been recently a CEO at a publicly-held company and now serving as a member of the board of several optical and electronics companies, he is familiar with a large range of management, corporate and board responsibilities and brings valuable perspectives to the Board as an independent director.

AGE:

DIRECTOR SINCE:

2019

COMMITTEES:

Audit Committee, Compensation Committee (Chair)

DIRECTORSHIP AT OTHER PUBLIC COMPANY:

Infinera Corporation, Fabrinet and MaxLinear, Inc.

Lasers and Technology

Financial Literacy

Global
Business

Manufacturing
and Operating

Business
Development
and M&A

Risk
Management

Executive
Leadership

Other Public
Company
Boards

Director Nominees

Eric Meurice

Independent Director

Mr. Meurice was President and Chief Executive Officer of ASML Holding NV, a provider of semiconductor manufacturing equipment and technology, from October 2004 to June 2013, and Chairman until March 2014. From 2001 to 2004, he was Executive Vice President of the Thomson Television Division of Thomson, SA, an electronics manufacturer. From 1995 to 2001, he served as head of Dell Computer’s Western, Eastern Europe and EMEA emerging market businesses. Before 1995, he gained significant technology experience at ITT Semiconductors and at Intel Corporation. Mr. Meurice serves on the boards of Umicore S.A., a recycling and materials company, since April 2015, Soitec S.A., a semiconductor materials manufacturer, since July 2018, and where he was appointed Chairman since March 2019, and Global Blue Group Holding AG, a leader in currency and value added tax processing, since September 2020. He previously served on the boards of Verigy Ltd., a manufacturer of semiconductor test equipment, ARM Holdings plc, a semiconductor intellectual property supplier, NXP Semiconductors N.V., a semiconductor company, and Meyer Burger Technology AG, a solar equipment vendor. Mr. Meurice earned a Master’s degree in Mechanics and Energy Generation at the Ecole Centrale de Paris, a Master’s degree in Economics from la Sorbonne University, Paris, and an M.B.A. from the Stanford University Graduate School of Business.

KEY ATTRIBUTES, EXPERIENCE AND SKILLS

Mr. Meurice has extensive skills and experience as a manager of several rapidly-growing, complex and global businesses in the capital equipment and electronics fields with several billions of dollars in revenues, most recently as former President and Chief Executive Officer of ASML Holding NV. He has experience managing a publicly-held company as well as experience on serving on several public company boards in the equipment and technology fields such as Soitec S.A., NXP Semiconductors N.V., Umicore S.A., Verigy Ltd. and ARM Holdings plc. Mr. Meurice also has a record of proven leadership as a strategic thinker, operator and marketer at the businesses he managed.

AGE:

DIRECTOR SINCE:

2014

COMMITTEES:

NCGC (Chair), Compensation Committee

DIRECTORSHIP AT OTHER PUBLIC COMPANY:

Umicore S.A., Soitec S.A. and Global Blue Group Holding AG

Lasers and Technology

Financial Literacy

Global
Business

Manufacturing
and Operating

Business
Development
and M&A

Risk
Management

Executive
Leadership

Other Public
Company
Boards

18 NOTICE OF 2022 ANNUAL MEETING AND PROXY STATEMENT

Director Nominees

Natalia Pavlova

Director

Ms. Pavlova has worked in a variety of roles at non-profit art institutions including the RISD Museum, Worcester Historical Museum and The Willard House and Clock Museum. She also served in sales and marketing roles at the Company previously. Ms. Pavlova holds a Qualification for Fine Art Critic and Historian of Art and Culture from the Russian State University for the Humanities, and an M.S. in Arts Administration from Boston University. She is the spouse of co-founder and Senior Vice President, Chief Scientist, Igor Samartsev.

KEY ATTRIBUTES, EXPERIENCE AND SKILLS

As a significant stockholder with family association to founders of the Company as well as having served as an employee of the Company in sales and marketing, Ms. Pavlova’s membership on the Board provides it with further engagement by individuals having a long-term perspective and strong economic ties with the Company. Among her specific attributes that qualify her to serve as a member of the Board, Ms. Pavlova possesses extensive knowledge of our history and culture. Ms. Pavlova strengthens the connection between the Company’s founding members and our Board, thereby assisting in the alignment of the Board with the interests of all IPG stockholders. Her experience working for nonprofit organizations adds different perspectives to the boardroom.

AGE:

DIRECTOR SINCE:

2021

COMMITTEES:

None

Financial Literacy

Non-Corporate Experience

Director Nominees

Thomas J. Seifert

Independent Director

Mr. Seifert is Chief Financial Officer of Cloudflare, Inc., an internet performance and security provider, from June 2017 to the present. Since July 2020, he is a member of the board of First Derivatives plc, a publicly held company in Ireland, that is a global technology provider working with some of the world's largest finance, technology, automotive, manufacturing and energy institutions. Mr. Seifert was a member of the board of CompuGroup Medical SE, a publicly held company in Germany, which provides software to support medical and organization activities in medical offices and facilities, from February 2018 to June 2020. Mr. Seifert was the Executive Vice President and Chief Financial Officer of Symantec Corporation, a provider of security, backup and availability solutions, from March 2014 to December 2016. Mr. Seifert served as Executive Vice President and Chief Financial Officer of Brightstar Corporation, a wireless distribution and services company, from December 2012 to March 2014. He was Senior Vice President and Chief Financial Officer at Advanced Micro Devices Inc., a semiconductor company, from October 2009 to August 2012, and served as Interim Chief Executive Officer from January 2011 to September 2012. From October 2008 to August 2009, Mr. Seifert served as Chief Operating Officer and Chief Financial Officer of Qimonda AG, a German memory chip manufacturer, and as Chief Operating Officer from June 2004 to October 2008. He also held executive positions at Infineon AG, White Oak Semiconductor, including the position as Chief Executive Officer, and Altis Semiconductor. Mr. Seifert has a Bachelor’s degree and a Master’s degree in Business Administration from Friedrich Alexander University and a Master’s degree in Mathematics and Economics from Wayne State University.

KEY ATTRIBUTES, EXPERIENCE AND SKILLS

Mr. Seifert has extensive experience as both an operating executive and chief financial officer of large publicly-held international technology businesses, such as Symantec and Advanced Micro Devices. In these and other senior positions, he developed deep financial and accounting knowledge, as well as managerial leadership skills, in larger organizations. With his background in accounting, finance and management, Mr. Seifert brings broad skills and knowledge to the Board, the Audit Committee and the NCGC including internal controls, mergers and acquisitions, integrations and information technology security.

AGE:

DIRECTOR SINCE:

2014

COMMITTEES:

Audit Committee
(Chair) - Audit
Committee Financial
Expert, NCGC

DIRECTORSHIP AT OTHER PUBLIC COMPANY:

First Derivatives plc

SEC Form DEF 14A filed by IPG Photonics Corporation