Trevor Ness
IPG PHOTONICSAbout Trevor Ness
Trevor D. Ness is Senior Vice President, Sales and Strategic Business Development at IPG Photonics (NEO). His annual incentive plan is tied to corporate net sales and adjusted EBIT with an additional personal performance component, while long-term incentives consist of PSUs measured on organic revenue growth and adjusted operating margin plus service-based RSUs, aligning pay with top-line growth and profitability execution . In 2024, management revised the AIP due to market conditions, and Ness’s final payout was 61.2% of target; PSUs granted in 2022 paid 0% in March 2025 given performance below threshold, and 2021 OCF PSUs vested at 66.3%, evidencing pay-for-performance rigor . The company faced a 24% net sales decline in 2024 amid industrial and automotive downturns, highlighting execution risk on growth metrics despite strong cash generation and capital returns .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| IPG Photonics | Senior Vice President, Sales and Strategic Business Development | — | 2024 objectives included improving medical business management, achieving sales targets, supporting systems business success, and corporate development activities |
External Roles
No external public-company directorships or outside roles for Ness are disclosed in the 2024/2025 proxy statements; executive bios are referenced as included in the Annual Report (not provided in the proxy) .
Fixed Compensation
| Metric | FY 2023 | FY 2024 |
|---|---|---|
| Base Salary ($) | $477,100 | $501,000 (base used for target calc in AIP table); salary reported in SCT was $494,106 reflecting partial-year timing/reporting conventions |
| Target Bonus % | 80% | 80% |
| Corporate/Personal Weighting | 75% / 25% | 75% / 25% (Revised AIP cap applied) |
| Target Bonus ($) | $381,680 | $400,800 |
| Actual AIP Payout ($) | $90,649 (23.8% of target) | $245,200 (61.2% of target; cap enforced under Revised AIP) |
| Other Cash Bonus ($) | — | — |
Performance Compensation
Annual Incentive (AIP)
| Year | Metric | Weighting | Target | Actual | Payout Details |
|---|---|---|---|---|---|
| 2023 | Net Sales (Corporate) | 75% | Not disclosed | Corporate performance below threshold; personal 95% | 23.8% of target → $90,649 |
| 2023 | Personal Objectives | 25% | Not disclosed | 95% | Included above |
| 2024 | Net Sales and Adjusted EBIT (Corporate) | 75% | Not disclosed | Corporate 100%+; AIP capped under Revised program | 61.2% of target → $245,200 |
| 2024 | Personal Objectives | 25% | Not disclosed | 94.75% | Included above |
Notes:
- CEO and NEO annual incentives focus on net sales and adjusted EBIT with additional personal performance; 2024 AIP was revised mid-year to cap payouts given market conditions .
Long-Term Incentives (PSUs/RSUs)
Structure at grant and award sizes:
| Metric | FY 2023 | FY 2024 |
|---|---|---|
| LTI Mix at Target | 25% PSUs (Operating Margin) / 25% PSUs (Organic Revenue Growth) / 50% RSUs | 25% PSUs (Operating Margin) / 25% PSUs (Organic Revenue Growth) / 50% RSUs |
| RSUs Granted (#) | 5,001 | 7,964 (plus 3,186 in enhanced LTI) |
| Operating Margin PSUs at Target (#) | 2,500 | 3,982 (plus 1,593 in enhanced LTI) |
| Organic Revenue Growth PSUs at Target (#) | 2,500 | 3,982 (plus 1,593 in enhanced LTI) |
| Vesting | RSUs: 3 annual installments commencing March 1 following grant; PSUs: cliff vest after 3-year performance (Mar 2026 for 2023 grants) | RSUs: annually in March over 3 years; PSUs: cliff vest March 2027 |
Historical PSU outcomes (applies to NEO cohort including Ness):
- 2021 OCF PSUs: vested at 66.3% of target in March 2024 (threshold 50%, target 100%, max 200%) .
- 2021 Relative TSR PSUs: 0% earned (below threshold) .
- 2022 PSUs (Organic Revenue Growth and Avg Adjusted Operating Margin): 0% earned in March 2025 (below threshold) .
Equity Ownership & Alignment
Outstanding Equity Awards (As of 12/31/2024)
| Grant Date | Type | Detail | Count/Strike | Expiration | Market/Payout Value ($) |
|---|---|---|---|---|---|
| 2/22/2018 | Stock Option (Exercisable) | Strike | 5,689 @ $239.72 | 2/21/2028 | — |
| 2/15/2019 | Stock Option (Exercisable) | Strike | 6,212 @ $154.88 | 2/14/2029 | — |
| 2/19/2021 | RSUs (Unvested) | Service-based | 656 | — | $47,704 |
| 2/18/2022 | RSUs (Unvested) | Service-based | 1,545 | — | $112,352 |
| 2/17/2023 | RSUs (Unvested) | Service-based | 3,334 | — | $242,448 |
| 2/17/2023 | PSUs (Unearned) | At target | 3,000 | — | $218,160 |
| 2/16/2024 | RSUs (Unvested) | Service-based | 11,151 | — | $810,901 |
| 2/16/2024 | PSUs (Unearned) | At target | 2,787 | — | $202,671 |
Additional alignment policies:
- Anti-hedging and anti-pledging: directors and officers prohibited from hedging and from pledging IPG stock; policy strengthened in 2023 to prohibit all pledging .
- Executive stock ownership guidelines: SVPs must hold at least 2× salary; options and unvested PSUs excluded; unvested time-based RSUs count; compliance required within four years; as of 12/31/2024, each NEO exceeded requirements or was within the phase-in period .
Trading/vesting activity indicator:
- 2023: Ness had no option exercises; RSUs/PSUs vested 5,412 shares, value realized $674,552 (pre-tax), indicating typical vesting but not incremental selling pressure from exercises .
Employment Terms
Potential Payments upon Termination (as of 12/31/2024)
| Scenario | Salary Severance & Benefits ($) | Incentive Plan Severance ($) | Equity Acceleration ($) | Total ($) |
|---|---|---|---|---|
| Termination Without Cause or For Good Reason | 789,640 | 245,200 | 551,581 | 1,586,421 |
| Termination Without Cause/Good Reason Following a Change in Control | 1,052,853 | 1,002,766 | 2,724,673 | 4,780,292 |
| Death | — | 245,200 | 2,724,673 | 2,969,873 |
| Disability | — | 245,200 | 1,678,378 | 1,923,578 |
| Non-Renewal | 526,427 | 245,200 | — | 771,627 |
Plan features and governance:
- Company compensation practices explicitly avoid single-trigger change-in-control payments; payouts are structured with safeguards and caps .
- Severance framework update (Oct 3, 2025): IPG adopted a Severance Plan covering Tier One Executives (including Ness), terminated prior SVP employment agreements, and updated “Good Reason” definitions including material reduction in responsibilities; plan coordinates with AIP, addresses health coverage equivalency outside U.S., and clarifies non-compete enforced payment scenarios .
- Clawback policy: adopted July 28, 2023 per SEC/Dodd-Frank rules; applies to incentive-based compensation over three years preceding any required financial restatement .
Investment Implications
- Alignment and performance rigor: AIP tied to net sales and adjusted EBIT, with 2024 payouts capped amid downturn; PSUs require annual organic revenue growth and adjusted operating margin over multi-year periods—recent PSU outcomes (0% for 2022 grants; 66.3% for 2021 OCF PSUs) demonstrate stringent hurdles and limited windfall risk .
- Retention vs. selling pressure: Significant unvested RSUs and PSUs (e.g., 11,151 RSUs and 2,787 PSUs at target from 2024), plus prior-year tranches, create retention incentives; the absence of option exercises in 2023 and anti-pledging/hedging policies reduce near-term selling pressure and misalignment risk .
- Severance and CoC economics: Post-2025 Severance Plan centralizes terms and clarifies “Good Reason,” while company policy avoids single-trigger CoC benefits; Ness’s modeled CoC total ($4.78M) is driven largely by equity acceleration, underscoring the importance of stock performance and vesting schedules for realized outcomes .
- Pay-for-performance credibility: 2024 corporate AIP capped, and multi-year PSUs commonly below target in a weak demand environment; combined with high say-on-pay support (97% in 2023) and formal clawback/ownership policies, governance signals are constructive though execution risk remains tied to restoring organic growth and margins after a 24% net sales decline in 2024 .
Overall, Ness’s compensation is heavily tethered to operational and growth metrics with robust governance constraints, suggesting balanced alignment; key trading signals hinge on upcoming PSU performance periods and RSU vesting cadence against IPG’s ability to re-accelerate organic revenue growth and adjusted operating margin .