DEF 14A 1 ny20002359x1_def14a.htm DEF 14A

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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934
Filed by the Registrant ☒
Filed by a Party other than the Registrant  
Check the appropriate box:
Preliminary Proxy Statement
Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
Definitive Proxy Statement
Definitive Additional Materials
Soliciting Material Pursuant to §240.14a-12
3D SYSTEMS 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 the appropriate box):
No fee required.
Fee paid previously with preliminary materials.
Fee computed on table in exhibit required by Item 25(b) per Exchange Act Rules 14a-6(i)(1) and 0-11.

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333 Three D Systems Circle
Rock Hill, SC 29730
April 11, 2022
Dear Fellow Stockholder:
You are cordially invited to join us at the Annual Meeting of Stockholders of 3D Systems Corporation to be conducted online on Tuesday, May 24, 2022, starting at 2:30 p.m., Eastern Time. In response to continued public health concerns related to the COVID-19 pandemic and to support the health and well-being of our stockholders and other meeting participants, the Annual Meeting will be held in a virtual meeting format only. During the virtual annual meeting, stockholders will be able to listen, vote, and submit questions from their home or any remote location with internet connectivity. Information on how to participate in this year’s virtual annual meeting can be found on page 3 of the accompanying Proxy Statement.
At the meeting, stockholders will vote on the following items:
The election of the 10 directors named in the Proxy Statement;
The approval, on an advisory basis, of the compensation paid to our named executive officers;
The approval of the amendment and restatement of the 2015 Incentive Plan which, among other things, increases the number of shares reserved for issuance thereunder by 6,935,000 shares; and
The ratification of the appointment of BDO USA, LLP as our independent registered public accounting firm for 2022.
In addition, stockholders will consider and act upon any other matters that may be properly brought before the Annual Meeting or at any adjournments or postponements thereof. If you were a stockholder at the close of business on March 28, 2022, you are eligible to vote at the Annual Meeting.
We encourage you to participate in the Annual Meeting so that we can review the past year with you, listen to your suggestions, and answer any questions that you may have. Whether or not you plan to participate in the Annual Meeting, please vote your shares as soon as possible so that your vote will be counted.
On behalf of 3D Systems Corporation and your Board of Directors, we thank you for your continued support.
 
Sincerely,
 
 
 

 
 
 
Dr. Jeffrey A. Graves
 
President and Chief Executive Officer

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NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
OF 3D SYSTEMS CORPORATION
The 2022 Annual Meeting of Stockholders (the “Annual Meeting”) of 3D Systems Corporation, a Delaware corporation (the “Company,” “3D Systems,” “we,” and “us”), will be held:
When:
Tuesday, May 24, 2022, at 2:30 p.m., Eastern Time.
Where:
The Annual Meeting will be held via live webcast at www.virtualshareholdermeeting.com/DDD2022. To participate, you will need the 16-digit control number provided on your proxy card or voting instruction form.
Why:
Stockholders are being asked to vote on the four agenda items described below and to consider any other business properly brought before the Annual Meeting and any adjournment or postponement of the meeting.
The election of the 10 directors named in the accompanying Proxy Statement;
The approval, on an advisory basis, of the compensation paid to our named executive officers;
The approval of the amendment and restatement of the 2015 Incentive Plan which, among other things, increases the number of shares reserved for issuance thereunder by 6,935,000 shares; and
The ratification of the appointment of BDO USA, LLP as our independent registered public accounting firm for 2022.
Stockholders of record at the close of business on March 28, 2022, are entitled to notice of, to attend, and to vote at the Annual Meeting. On or about April 11, 2022, this Proxy Statement, our Annual Report on Form 10-K for the year ended December 31, 2021 (the “2021 Annual Report”), and proxy card are being mailed or made available to stockholders.
We encourage you to vote on the proposals to be considered at the Annual Meeting electronically by using the website that hosts our Proxy Statement and 2021 Annual Report as described on the Notice of Internet Availability of Proxy Materials (the “Notice of Internet Availability”). If you have requested delivery of a printed version of the materials, you will receive a proxy card that you may use to vote your shares. You may also vote by telephone as set forth on the Notice of Internet Availability, your proxy card, or any voting instruction form provided to you.
Regardless of whether you plan to participate in the Annual Meeting, we encourage you to vote your shares electronically on the internet, by telephone, or by proxy card. Please vote today to ensure that your votes are counted.
If you participate in the Annual Meeting, you will be able to vote your shares electronically during the Annual Meeting if you so desire, even if you previously voted. See page 3 of this Proxy Statement for additional details on how to participate in the meeting.
 
By Order of the Board of Directors
Rock Hill, South Carolina
April 11, 2022
 
 

 
Andrew M. Johnson
Secretary
Important Information Regarding the Availability of Proxy Materials for
the Annual Meeting of Stockholders
This Proxy Statement and the 2021 Annual Report are available at www.proxyvote.com

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PROXY STATEMENT
FOR THE ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON MAY 24, 2022
RECORD DATE, VOTING SECURITIES AND QUORUM
The record date for determining the stockholders entitled to notice of and to vote at the Annual Meeting is the close of business on March 28, 2022.
Our common stock, par value $0.001 per share (the “Common Stock”), is our only outstanding class of voting securities. As of the record date for the Annual Meeting, there were 130,356,063 shares of Common Stock issued and outstanding. Each such share of Common Stock is entitled to one vote on each matter to be voted on at the Annual Meeting.
Holders of record of shares of our Common Stock outstanding as of the close of business on the record date are entitled to notice of and to vote at the Annual Meeting.
A majority of the shares of Common Stock outstanding on the record date that are present in person or represented by proxy will constitute a quorum for the transaction of business at the Annual Meeting.
Stockholders who participate in the virtual Annual Meeting will be deemed present in person at the meeting.
HOW TO VOTE
Voting your shares is important to ensure that we get the minimum quorum required to hold and conduct business at the Annual Meeting. Your affirmative participation in the voting process also helps us avoid the need and the added expense of having to contact you to solicit your vote and helps us avoid the need to reschedule the Annual Meeting. We hope that you will exercise your legal rights and fully participate in our future.
We encourage you to review this Proxy Statement and our 2021 Annual Report before you cast your vote. Whether you are a stockholder of record or a street-name holder (each discussed below), you may vote any shares of Common Stock that you are entitled to vote:
electronically on the internet;
by using a toll-free telephone number furnished to you (up until 11:59 p.m., Eastern Time, on Monday, May 23, 2022, the business day prior to the Annual Meeting); or
by mail using a proxy card or voting instruction form furnished to you.
Stockholders of Record
You are considered to be a stockholder of record of each share of Common Stock that is registered in your name on the records of our transfer agent. In this Proxy Statement, we refer to these stockholdings as “record holdings” and to you as a “record holder.” If you are a record holder, we will send you a Notice of Internet Availability. Please follow the instructions in the Notice of Internet Availability to vote.
Street-Name Holders
If you hold your shares in a brokerage account or bank or through another nominee holder, your broker, bank, or other nominee is considered to be the record holder of those shares, and you are considered the “beneficial owner” of shares held in “street-name.” As a beneficial owner, you generally have the right to instruct your broker, bank, or other nominee how to vote your shares. In this Proxy Statement, we refer to these stockholdings as “street-name holdings” and to you as a “street-name holder.”
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You should expect your broker, bank, or other nominee to send you a voting instruction form either by regular mail or by email. Your broker, bank, or other nominee is required to vote your shares pursuant to your instructions. In limited circumstances, your broker, bank, or other nominee may, but is not required to, vote your shares in the absence of specific voting instructions from you for matters that are considered “routine.” We understand that the ratification of the selection of BDO USA, LLP (“BDO”) as our independent registered public accounting firm for 2022 is the only “routine” proposal on which stockholders are being asked to vote at the Annual Meeting. Accordingly, if you do not give voting instructions to your broker, bank, or other nominee, it will be entitled to vote your shares in its discretion on the ratification of the appointment of BDO; however, the nominee will not vote your shares in connection with (i) the election of directors, (ii) the advisory vote on the compensation of our named executive officers, or (iii) the approval of the amendment and restatement of the 2015 Incentive Plan.
Accordingly, street-name holders need to be mindful of the following:
For your vote to be counted with respect to each of the proposals, except the ratification of BDO’s appointment, you will need to communicate your voting instructions to your broker, bank, or other nominee before the date of our Annual Meeting.
You may also give your broker, bank, or other nominee instructions on voting your shares as to the ratification of BDO’s appointment. If you provide no instructions, the nominee may, but is not required to, exercise its discretion in voting on the ratification of the appointment of BDO as our independent registered public accounting firm for 2022.
If your broker, bank, or other nominee exercises that discretion, your shares will be treated as present at the Annual Meeting for all quorum purposes.
To ensure that you as a street-name holder can participate in our upcoming Annual Meeting, please review our proxy materials and follow the instructions for voting your shares on the voting instruction form that you will be receiving from your broker, bank, or other nominee.
For a discussion of the mechanics of each of these means of voting, please see “How to Cast Your Vote if You are a Stockholder of Record,”How to Cast Your Vote if You are a Street-Name Holder,” Voting During the Annual Meeting,” and “Other Voting and Stockholder Matters” below.
VOTING MATTERS
Once a quorum of the shares entitled to vote is present in person or represented by proxy at the Annual Meeting, the votes required to approve the matters to be considered at the Annual Meeting are as follows:
Election of Directors. Each director is elected by the affirmative vote of the majority of the votes cast for such director at the Annual Meeting.
Advisory Vote on the Compensation of Our Named Executive Officers. The affirmative vote of a majority of shares present at the Annual Meeting and entitled to vote thereon is required to approve this matter.
Approval of the Amendment and Restatement of the 2015 Incentive Plan. The affirmative vote of a majority of shares present at the Annual Meeting and entitled to vote thereon is required to approve this matter.
Ratification of Appointment of the Independent Registered Public Accounting Firm. The affirmative vote of a majority of shares present at the Annual Meeting and entitled to vote thereon is required to approve this matter.
If you specify how your shares are to be voted on a matter, the shares represented by your proxy or other voting instructions will be voted in accordance with your instructions. If you are a stockholder of record and you do not give specific voting instructions, but you otherwise sign, date, and grant a valid proxy, your shares will be voted as follows:
FOR the election of the 10 nominees for director named below;
FOR the approval, on an advisory basis, of the compensation paid to our named executive officers;
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FOR the approval of the amendment and restatement of the 2015 Incentive Plan, which would, among other things, increase the number of shares reserved for issuance thereunder by 6,935,000 shares; and
FOR the ratification of the selection of BDO as our independent registered public accounting firm for 2022.
We do not know of any other matters to be presented for consideration at the Annual Meeting. However, if any other matters are properly presented for consideration, the proxy holders will vote your shares on those matters in accordance with the recommendations of the Board of Directors (the “Board of Directors” or “Board”). If the Board of Directors does not make a recommendation on any such matters, the proxy holders will be entitled to vote in their discretion on those matters.
INSTRUCTIONS FOR ATTENDING AND PARTICIPATING IN THE VIRTUAL ANNUAL MEETING
This year our Annual Meeting will once again be a completely virtual meeting. We are not hosting the meeting at a physical location this year as a precaution due to continued concerns regarding the COVID-19 pandemic. The meeting will only be conducted via live webcast.
Stockholders at the close of business on March 28, 2022, will be able to attend the Annual Meeting and to vote and submit questions virtually on the internet during the meeting. The meeting will begin promptly at 2:30 p.m., Eastern Time, on May 24, 2022, at www.virtualshareholdermeeting.com/DDD2022. We encourage you to access the Annual Meeting prior to the start time to allow ample time for check in. To log in, you will need the 16-digit control number provided on your Notice of Internet Availability, proxy card, or voting instruction form.
Once a quorum of the shares entitled to vote is present in person or represented by proxy at the Annual Meeting, the matters discussed above in “Voting Matters” will be considered. Questions pertinent to meeting matters will be answered during the meeting subject to time constraints. Questions regarding personal matters, including those related to employment, product or service issues, or suggestions for product innovations, are not pertinent to meeting matters and, therefore, will not be answered.
If you encounter any technical difficulties accessing the virtual meeting during the check-in or meeting time, please call the technical support number that will be posted on the virtual Annual Meeting log in page.
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CORPORATE GOVERNANCE AT 3D SYSTEMS
Role of the Board of Directors
Our Board oversees the management of the Company’s business and affairs. Stockholders elect the members of the Board to act on their behalf and to oversee their interests. Unless reserved to the stockholders under applicable law or our Amended and Restated Bylaws (“Bylaws”), all corporate authority resides in the Board as the representative of the stockholders. The Board selects and appoints executive officers to manage the day-to-day operations of the Company, while retaining ultimate oversight responsibilities. Together, the Board and management share an ongoing commitment to the highest standards of corporate governance and ethics. The Board reviews all aspects of our governance policies and practices, including our Corporate Governance Guidelines and the Company’s Code Conduct and Code of Ethics, at least annually and makes changes as necessary. The Corporate Governance Guidelines and the Code of Conduct and Code of Ethics, along with all committee charters, are available in the Governance section of the Company’s website as described in “Availability of Information” on page 15.
Corporate Governance Guidelines
Our Board of Directors is committed to sound and effective corporate governance practices, to exercising its oversight responsibilities diligently with respect to our business and affairs consistent with the highest principles of business ethics, and to meeting the corporate governance requirements that apply to us. We believe that good corporate governance helps to ensure that the Company is managed for the long-term benefit of our stockholders. We regularly review and consider our corporate governance policies and practices, taking into account the Securities and Exchange Commission’s (the “SEC”) corporate governance rules and regulations, the corporate governance standards of the New York Stock Exchange (the “NYSE”), and stockholder feedback.
The Board has adopted Corporate Governance Guidelines that provide a framework for the governance of the Company as a whole and describe the principles and practices that the Board follows in carrying out its responsibilities. Our Corporate Governance Guidelines address, among other things:
The structure, composition, functions, and policies of the Board and its committees;
Director qualification standards and nomination process;
Expectations and responsibilities of the directors;
Management succession planning; and
Communications with stockholders and independent directors.
Our Corporate Governance Guidelines further require that the Board, acting through the Corporate Governance and Sustainability Committee (the “Governance Committee”), conduct a self-evaluation at least annually to determine whether it and its committees are functioning effectively. In addition, our Corporate Governance Guidelines require that each committee conduct an annual self-evaluation to assess its compliance with the requirements of its charter and the Corporate Governance Guidelines, as well as ways in which committee processes and effectiveness may be enhanced. The Governance Committee is responsible for overseeing our Corporate Governance Guidelines, periodically assessing their adequacy, and modifying them to meet new circumstances. These Corporate Governance Guidelines are posted on our website.
Nomination and Election of Directors
Our Bylaws provide that a director nominee is elected only if he or she receives a majority of the votes cast with respect to his or her election in an uncontested election (that is, the number of votes cast “for” that nominee exceeds the number of votes cast “against” that nominee). Stockholders can vote to “abstain,” but that vote will not have an effect in determining the election results. For more information, see “Voting Matters” on page 2 and “Other Voting and Stockholder Matters” on page 64. If a nominee who currently serves as a director is not re-elected, Delaware law provides that the director would continue to serve on the Board as a “holdover director.” Under our Corporate Governance Guidelines, each director must submit an advance, contingent, irrevocable resignation that the Board may accept if stockholders do not re-elect that director. In that situation, our Governance Committee would make a recommendation to the Board about whether to accept or reject the
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resignation or whether to take other action instead. Within 90 days from the date of the certified election results, the Board would act on the Governance and Committee’s recommendation and publicly disclose its decision and the rationale behind it.
Director Independence
Eleven of our current 13 directors (and nine of the 10 director nominees) are independent directors. Under the corporate governance standards of the NYSE, at least a majority of our directors and all of the members of the Audit Committee, Compensation Committee, and Governance Committee must be “independent” directors. The corporate governance standards of the NYSE provide that to qualify as an “independent” director, in addition to satisfying certain bright-line criteria, the Board must affirmatively determine that a director has no material relationship with us (either directly or as a partner, stockholder, or officer of an organization that has a relationship with the Company). The Board has affirmatively determined that director nominees Malissia R. Clinton, William E. Curran, Claudia N. Drayton, Thomas W. Erickson, Jim D. Kever, Charles G. McClure, Jr., Kevin S. Moore, Vasant Padmanabhan, and John J. Tracy satisfy the bright-line criteria of the corporate governance standards of the NYSE and that they have no material relationships with us. In making its determination, the Board and the Governance Committee reviewed the following relationships:
Dr. Graves, our Chief Executive Officer (“CEO”), is an executive officer of the Company and, as such, is not an independent director.
Dr. Padmanabhan is an executive officer of Smith+Nephew, a customer of the Company that purchased software and on-demand services in each of 2019, 2020, and 2021. Prior to nominating Dr. Padmanabhan to the Board, the Governance Committee undertook a review of these transactions and Dr. Padmanabhan’s actual or potential interest in them. The transactions had an aggregate value of less than $1 million in each year and were negotiated in arm’s length transactions under terms similar to those offered in other third-party transactions. Based on a review of the facts and circumstances of the transactions the Board determined (based on the recommendation of the Governance Committee) that Dr. Padmanabhan had no direct or indirect material interest in the transactions.
Mr. Erickson is a non-executive member of the board of directors of MW Industries, a customer of the Company that purchased healthcare services from the Company in each of 2019, 2020, and 2021 in arm’s length transactions similar to those offered in other third-party transactions. Mr. Erickson is not responsible for the 3D Systems’ account, and, based on a review of the facts and circumstances of the transactions, the Board determined (based on the recommendation of the Governance Committee) that Mr. Erickson had no direct or indirect material interest in the transactions.
The Board also affirmatively determined that William D. Humes and Jeffrey Wadsworth are independent, satisfy the bright-line criteria of the corporate governance standards of the NYSE, and have no material relationship with us. Messrs. Humes and Wadsworth are not standing for re-election at the Annual Meeting, and their service as directors will end following the Annual Meeting. Charles W. Hull, a founder of the Company and our current Executive Vice President and Chief Technology Officer for Regenerative Medicine, is an executive officer of the Company and, as such, is not an independent director. Due to the newly implemented age limit for directors, Mr. Hull is not standing for re-election at the Annual Meeting and his service as director will end following the Annual Meeting.
Director Qualifications
In nominating each of the director nominees, the Governance Committee and the Board considered, among other things, the Corporate Governance Guidelines, which were adopted in 2004 and most recently amended in February 2022, and the Qualifications for Nomination to the Board, which were adopted in 2004 and most recently reviewed in February 2021. These documents are posted on our website. These qualifications include, among other factors, a candidate’s ethical character, experience, and diversity of background as well as whether the candidate is independent under applicable listing standards and financially literate. The Governance Committee and the Board also took into consideration the following factors relating to each director since the 2021 Annual Meeting:
such director’s contributions to the Board;
any material change in such director’s employment or responsibilities with any other organization;
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such director’s attendance at meetings of the Board and the Board committees on which such director serves and such director’s participation in the activities of the Board and such committees;
the absence of any relationships with the Company or another organization, or any other circumstances that have arisen, that might make it inappropriate for the director to continue serving on the Board; and
such director’s age and length of service on the Board.
The Governance Committee and the Board considered each nominee’s overall business experience, contributions to Board activities during 2021, and independence in their evaluation of each nominee in conjunction with the factors discussed above but did not otherwise give greater weight to any of the factors cited above compared with any of the others. While the Board considers self-identified diversity characteristics and diversity of experience in its nomination decisions, we do not maintain a diversity policy relating to the composition of the Board of Directors. The Board believes that each of the nominees for director is well qualified to continue to serve as a director of the Company and that the nominees provide the mix of experience that is required to enable the Board to perform its functions.
Relevant information regarding the background and experience of each of the nominees for director that the Governance Committee and the Board considered in evaluating each nominee is set forth below their respective names beginning on page 18.
Related Party Transaction Policy and Procedures
In addition to the provisions of our Code of Conduct and Code of Ethics that deal with conflicts of interest and related-party transactions, we have adopted a Related Party Transaction Policy that is designed to confirm our position that related-party transactions should be avoided except when they are in our interests and to require that certain types of transactions that may create conflicts of interest or other relationships with related parties are approved in advance by (a) the Board of Directors and (b) the Governance Committee or a committee composed of directors who are independent and disinterested with respect to the matter under consideration. This policy applies to transactions meeting the following criteria:
the amount involved will or may be expected to exceed $120,000 in any calendar year;
we or any of our subsidiaries would be a participant; and
any person who is or was in the current or immediately preceding calendar year an executive officer, director, director nominee, greater than five percent beneficial owner of our Common Stock or immediate family member of any of the foregoing has or will have a direct or indirect interest.
In adopting this policy, the Board reviewed certain types of transactions and deemed them to be pre-approved even if the amount involved exceeds $120,000. These types of transactions include:
employment arrangements with executive officers where such executive officer’s employment in that capacity and compensation for serving as an executive officer has been approved by the Board, the Compensation Committee, or another committee of independent directors;
director compensation arrangements where such arrangement has been approved by the Governance Committee (or another committee of independent directors) and the Board;
awards to executive officers and directors under compensatory plans and arrangements pursuant to our 2015 Incentive Plan and our 2004 Restricted Stock Plan for Non-Employee Directors (the “2004 Directors Stock Plan”), the exercise by any executive officer or director of any previously awarded stock option that is exercised in accordance with its terms, and any grants or awards made to any director or executive officer under any other equity compensation plan that has been approved by our stockholders;
certain transactions with other companies where a related party has a de minimis relationship (as described in the policy) with the other company and the amount involved in the transaction does not exceed the lesser of $500,000 or 2 percent of the other company’s total annual revenue;
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charitable contributions made by us to a charitable organization where a related party has a de minimis relationship and the amount involved does not exceed the lesser of $10,000 or 2%of the charitable organization’s total annual receipts and charitable contributions under any matching program maintained by us that is available on a broad basis to employees generally; and
other transactions where all security holders receive proportional benefits.
Under the terms of our Related Party Transaction Policy, when considering whether to approve a proposed related party transaction, factors to be considered include, among other things, whether such transaction is on terms no more favorable than terms generally available to an unaffiliated third-party under the same or similar circumstances and the extent of the related party’s interest in the transaction. A copy of our Related Party Transaction Policy is posted on our website. See “Availability of Information” on page 15 of this Proxy Statement.
There were no related-party transactions in 2021.
Global Responsibility and Sustainability
Sustainability Program
3D Systems recognizes that sustainability is important to how we do business. The context in which our business operates is transforming due to the effects of climate change and heightened social, economic, and health challenges around the globe. The Company believes that it is well positioned to respond to these challenges by integrating sustainable business activities into our strategy and operations to deliver long-term value. We continue to enhance our environmental, social, and governance (“ESG”) activities as we develop our long-term sustainability strategy.
Responsible Practices & Governance
We uphold strong corporate governance and demonstrate integrity as we leverage this foundation to influence our sustainability activities. The Company’s sustainability program is led by our Chief People & Culture Officer, and the Board has delegated oversight of these efforts to the Governance Committee. Through collaboration across our business functions, we identify priorities and evolve our sustainability and governance activities to address changing global trends.
In 2021, we focused our efforts on expanding ESG disclosures and maturing aspects of our environmental and social activities within our sustainability program. These enhancements included analyzing key stakeholder perspectives, expanding ESG reporting to include our key facilities, measuring greenhouse gas (“GHG”) emissions and other impactful ESG metrics, and externally disclosing our key talent management strategies.
Stakeholder Engagement: Understanding expectations of key stakeholders is an important part of evolving our sustainability program. We survey our team members to gather their feedback in areas such as culture, career development, inclusivity, integrity, team member success, and environmental stewardship. Additionally, we perform in-depth analysis on our largest investors and customers to further influence our program today and well into the future. From our review, we noted key stakeholder priorities include addressing climate and energy efficiency, health, safety and wellbeing, product stewardship, diversity, equity and inclusion, and training and development.
Environmental Responsibility
We acknowledge our role in decarbonizing the global economy and are committed to being a responsible steward of the environment as we grow and operate our business.
Our Products and Customers: As we develop and innovate our products and services, we consider emerging global trends impacting the world and our customers. Our unique offerings of hardware, software, materials, and services provide application-specific solutions powered by the expertise of our application engineers. These engineers collaborate with customers to transform how they deliver their products and services. We will further focus on developing solutions to enable our customers to address evolving sustainability challenges, considering strategies such as advance materials, production on demand, and improved efficiencies through additive manufacturing capabilities.
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Our Operations: In 2021, we publicly disclosed our Environmental, Health and Safety Policy, Water Policy, and Waste Management Practices. Additionally, we newly introduced ESG reporting on GHG emissions, energy use, waste, and recycling metrics. This data will be used to provide insights to management and the Board as we evaluate environmental strategies, commitments, and define goals around further reducing GHG emissions, conserving energy, and minimizing waste.
Social Responsibility
We are committed to supporting the health, safety, and well-being of our teams and of the communities where we live and work. In 2021, we publicly disclosed our Human Rights and Labor Rights Policy.
Health & Safety: We focus on reducing health and safety risks and driving a strong safety culture through communication, awareness, and visible leadership. To assist in achieving this commitment, we provide substantial safety trainings and necessary equipment at all facilities and have specific safety programs in place for those working in potentially high-hazard environments. We monitor injury and illness health and safety metrics across the Company to continually evaluate our safety programs to meet the needs of our teams. Additionally, throughout this past year, our leadership regularly reviewed and adapted our COVID-19 protocols based on evolving research and guidance.
Our Communities: It is important to us to make a positive contribution to society and support the communities where our team members live and work. We encourage our teams to participate in our 3D Systems Gives Back volunteer program where our sites around the world choose a nonprofit or community service activities to support local communities. Additionally, throughout the COVID-19 pandemic, we helped medical device manufacturers and hospitals bridge the supply chain gap and issued a call to action to our network of customers, partners, and others in the additive manufacturing community to share resources.
Talent Management Strategies: We believe that our team members are vital to our success, and we depend on our highly skilled teams to innovate and deliver to our customers. We prioritize our talent management strategies to attract and hire top talent, develop our teams to build key capabilities and skills, and engage, motivate, and retain our team members to do their best work.
Inclusion & Belonging: We strive to broaden the diversity of our workforce to propel our culture of innovation and our ability to deliver forward-thinking solutions. Our commitment is to foster an environment where inclusion and belonging is central to how we work across our global teams and support our team members with opportunities to grow, contribute, and develop. We engage our team members through activities such as the following:
3D Systems Employee Resources Groups have been established over the years to promote networking, mentor relationships, and create a sense of belonging across our teams.
Women Networking Events are in place to further build network opportunities for women internally across our offices and externally with memberships in outside professional organizations.
Internship Program is a critical component for the addition of new talent for the Company. We continue to invest in a world-class experience for our summer interns.
Racial Equity Challenge, launched in 2021, was an 8-week series created to promote an open and safe environment for team members to share insights and ask questions about racial and social challenges for our business and society.
3D Awareness Portal is in place to celebrate the diversity of our 3D team members, highlighting unique perspectives of colleagues around the world, and providing other educational resources to further build our culture of inclusiveness and belonging.
As we evolve our talent strategies, we will continue to define our commitments and related goals.
See “Availability of Information” on page 15 of this Proxy Statement for instructions on how to access the Company’s Sustainability webpage, which includes our Environmental, Health and Safety Policy, Water Policy, Waste Management Practices, and Human Rights and Labor Rights Policy, and to learn more about our Company culture, values, and sustainability initiatives.
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Code of Conduct and Code of Ethics
Our Code of Conduct applies to all of our employees worldwide, including all of our officers. We separately maintain a Code of Ethics that applies to our CEO, CFO, principal accounting officer, and all other senior financial executives and to directors of the Company when acting in their capacity as directors.
These documents are designed to set high standards of business conduct and ethics for our activities and to help directors, officers, and employees resolve ethical issues. The purpose of our Code of Conduct and our Code of Ethics is to provide assurance to the greatest possible extent that our business is conducted in a consistently legal and ethical manner. Employees may submit concerns or complaints regarding ethical issues on a confidential basis by means of our Ethics Open Line, which includes a toll-free telephone number and website. Communications through the Ethics Open Line are monitored on a daily basis, and all messages are reported to the Chief Ethics and Compliance Officer and the Chair of the Compliance Committee.
We intend to disclose amendments to, or waivers from, any provision of the Code of Ethics that applies to our CEO, CFO, or principal accounting officer and persons performing similar functions and that relates to any element of the Code of Ethics described in Item 406(b) of Regulation S-K by posting such information on our website. There have been no such waivers since the date of the proxy statement for our 2021 Annual Meeting.
Strategy and Risk Oversight
Risk Responsibility and Oversight
Consistent with Delaware law, our business is managed by our officers under the direction and oversight of the Board of Directors. In this regard, our management, including our corporate officers, is responsible for the day-to-day management of the risks facing us, including macroeconomic, financial, strategic, operational, public reporting, legal, regulatory, political, compliance, organizational, security, and reputational risks. They carry out this responsibility through a coordinated effort among themselves in the management of our business.
In exercising its oversight responsibilities, as permitted by law, the Board receives and relies on reports and other information provided by management, reviews and approves matters that it is required or permitted to approve by law or our Certificate of Incorporation or Bylaws, and receives information relating to, and inquiries into, such other matters as it deems appropriate, including our strategic outlook, business plans, prospects and performance, succession planning, risk management, cybersecurity, and other matters for which it has oversight responsibility. The Board carries out its general oversight responsibility both by acting as a whole as well as through its committees. Among other things, the Board as a whole periodically reviews our processes for identifying, ranking, and assessing risks that affect our organization as well as the output of those processes. The Board as a whole also receives periodic reports from our management on various risks, including risks of the types mentioned above facing our businesses, risks presented by transactions that are presented to the Board for approval, and risks arising out of our corporate strategy.
As discussed below, the Board also maintains several standing committees with risk oversight responsibility for various Board functions. Although the Board has ultimate responsibility for overseeing risk, its standing committees perform certain of its risk oversight responsibilities. For example, the Audit Committee engages in ongoing discussions regarding major financial and accounting risk exposures and the process and system employed to monitor and control such exposures. In addition, the Audit Committee engages in periodic discussions with management concerning the process by which risk assessment and management are undertaken, and it exercises oversight with regard to the risk assessment and management processes related to, among other things, internal controls, credit, capital structure, liquidity, cybersecurity, and insurance programs. In carrying out these responsibilities, the Audit Committee, among other things, regularly reviews with the Internal Audit Director the audits or assessments of significant accounting and audit risks conducted by Internal Audit personnel based on their audit plan, and the Audit Committee regularly meets in executive sessions with the Internal Audit Director. The Audit Committee also regularly reviews with management our internal control over financial reporting, including any significant deficiencies or material weaknesses. As part of these reviews, the Audit Committee reviews steps taken by management to monitor, control and mitigate risks. The Audit Committee also regularly reviews with the Chief Legal Officer significant legal, regulatory and compliance matters that could have a material impact on our financial statements or business. Finally, from time-to-time executives who are responsible for managing particular risks, such as cybersecurity, report to the Audit Committee on how those risks are being controlled and mitigated.
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Other Board committees also exercise responsibility to oversee risk within their areas of responsibility and expertise. For example, as noted in the section below entitled “Risk Assessment of Compensation Policies and Practices,” the Compensation Committee oversees risk assessment and management with respect to our compensation policies and practices, and it exercises oversight with respect to our 401(k) plan; the Governance Committee engages in periodic discussion with our Chief Ethics and Compliance Officer regarding major environment, health, and safety risks; and the Compliance Committee engages in ongoing discussion with the Chief Legal Officer and the Chief Ethics and Compliance Officer regarding regulatory and compliance matters, including compliance with applicable export controls, government contracts, FDA, and similar governmental regulatory regimes.
In those cases where committees have risk oversight responsibilities, the Chairs of the committees regularly report to the full Board the significant risks facing the Company, as identified by management, and the measures undertaken by management for controlling and mitigating those risks.
Risk Assessment of Compensation Policies and Practices
Our Compensation Committee has reviewed our incentive compensation programs, discussed the concept of risk as it relates to our compensation program, considered various mitigating factors, and reviewed these items with its independent consultant, Meridian Compensation Partners, LLC (“Meridian”). In addition, our Compensation Committee asked Meridian to conduct an independent risk assessment of our executive compensation program. Based on these reviews and discussions, the Compensation Committee does not believe our compensation program creates risks that are reasonably likely to have a material adverse effect on our business.
For more information regarding our compensation program, see the section of this Proxy Statement titled “Compensation Discussion and Analysis” beginning on page 26.
Board Leadership
Board Diversity and Refreshment
The Board is committed to building a Board with diverse experiences and backgrounds. As part of our ongoing commitment to creating a balanced Board with diverse viewpoints and deep industry expertise, we have added new directors to infuse new ideas and fresh perspectives in the boardroom.
Our directors reflect diverse perspectives, including a complementary mix of skills, experience, and backgrounds that we believe are paramount to our ability to represent your interests as stockholders. In the last four years, three new independent directors have been elected to the Board, each of whom identifies as gender or ethnically diverse.
The Board is focused on achieving the right mix of skills, experience, and perspectives to support our future strategic direction. For example, we have recently prioritized industry knowledge and experience in our director recruitment efforts, as reflected by the recent additions of Ms. Drayton and Dr. Padmanabhan to the Board.
Board Leadership Structure
The Board has separated the position of its Chairman from the position of CEO. Mr. McClure, an independent director, serves as Chairman of the Board of Directors. Mr. McClure was appointed Chairman in October 2018.
We do not have a policy regarding whether the Chairman and CEO roles should be combined or separated. Rather, the Board of Directors prefers to retain flexibility to choose its leadership structure and Chairman in any way that it deems best for the Company at any given time. The Board periodically reviews the appropriateness and effectiveness of its leadership structure. Currently, the Board believes that it is appropriate for Mr. McClure to remain Chairman given his independence as a director, broad experience in domestic and international operations management, deep experience in executive management, director roles within other publicly traded companies, and significant expertise in the automotive industry, a key vertical for the Company. With the foregoing in mind, the Board believes that the current Board leadership structure allows Dr. Graves to focus on managing the daily operations of the Company in his role as CEO while permitting Mr. McClure to oversee the Board’s significant functions. The Board also believes that the current structure aids in the efficient conduct of Board meetings as the directors discuss key business and strategic matters and other critical issues.
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While the Board believes that the separation of the positions of Chairman and CEO has been beneficial to the Company, the Board does not view any particular Board leadership structure as being preferable to any other. Accordingly, if any future change in the Board’s leadership structure occurs (which the Board does not currently expect to happen), the Board will take such actions with respect to its leadership structure as it then considers to be appropriate.
Succession Planning
We maintain a succession plan for the position of CEO and other executive officers. To assist the Board with this requirement, the CEO annually leads the Board of Directors in a discussion of CEO and senior management succession. The annual review includes an evaluation of the requirements for the CEO and each senior management position and an examination of potential permanent and interim candidates for CEO and other senior management positions.
Director Tenure
The Board generally believes that a mix of long- and short-tenured directors promotes an appropriate balance of views and insights and allows the Board as a whole to benefit from the historical and institutional knowledge that longer-tenured directors possess, and the fresh perspectives contributed by newer directors. In support of Board refreshment efforts discussed above, the Board has implemented both 10-year term limits (effective beginning December 2019) and a mandatory retirement age of 75 for directors.
Board Evaluations
We are committed to providing transparency about our Board and committee evaluation process. Our Chairman of the Board and Chair of the Governance Committee lead the Board’s self-evaluation process. Each director completes a comprehensive questionnaire evaluating the performance of the Board as a whole and the committees on which the director serves. The directors’ responses are aggregated and anonymized to encourage the directors to respond candidly and to maintain the confidentiality of their responses. The directors’ responses about the performance of the Board as a whole and the committees are summarized and shared with the Board. The annual evaluation process provides the Board with valuable insight regarding areas where the Board believes it functions effectively and, more importantly, areas where the Board believes it can improve.
Meetings of the Board and its Committees
Meetings and Meeting Attendance
During 2021, the Board of Directors held 12 meetings. In 2021, each member of the Board of Directors attended at least 75 percent of the aggregate number of meetings of the Board of Directors held during the period for which he or she was a director and of the committees of the Board on which he or she served during the periods that he or she served. A discussion of the number of committee meetings held during 2021 appears below.
The Board holds executive sessions with only non-employee directors in attendance at its regular meetings and at other meetings when circumstances warrant those sessions. The CEO and other members of management are excused from these executive sessions. The Chairman of the Board or the Chairman of the Governance Committee presides over such non-management sessions of the Board. Additionally, the independent directors meet in executive session at least annually. The CEO, any other non-independent directors, and other members of management are excused from such meetings, and the Chairman of the Board presides over such meetings.
It is expected that all incumbent directors and director nominees will attend our annual meetings of stockholders (virtually for purposes of the 2022 Annual Meeting). All the directors then in office virtually attended our 2021 Annual Meeting of Stockholders.
Committees of the Board of Directors
The Board of Directors maintains an Audit Committee, a Compliance Committee, a Compensation Committee, a Governance Committee, and a Technology Applications Committee as the standing committees of the Board. The current members of all NYSE-required committees (the Audit Committee, the Compensation Committee, and the Governance Committee) are independent directors.
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Each of the committees operates under a written charter that has been approved by the Board and is posted on our website. Each of these committees periodically reviews its written charter and updates its charter as necessary.
The table below provides membership information for each of the Board’s standing committees as of the date of this Proxy Statement.


Member

Chair
(1)
Not standing for re-election at the Annual Meeting
Audit Committee
In addition to the risk oversight matters discussed under “Corporate Governance at 3D Systems—Strategy and Risk Oversight” above, the principal responsibilities of the Audit Committee are to assist the Board of Directors in fulfilling its oversight responsibilities for:
monitoring our systems of internal accounting and financial controls;
our public reporting processes;
the retention, performance, qualifications, and independence of our independent registered public accounting firm;
the performance of our internal audit function;
the annual independent audit of our consolidated financial statements;
the integrity of our consolidated financial statements;
the oversight of our enterprise compliance risk relating to financial and competitive risk exposures; and
our compliance with legal and regulatory requirements.
The Audit Committee has the ultimate authority and responsibility to select, evaluate, and approve the terms to retain, compensate and, where appropriate, replace our independent registered public accounting firm.
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The Board of Directors has determined, upon the recommendation of the Governance Committee, that each member of the Audit Committee is an “audit committee financial expert” as defined in the regulations of the SEC and, therefore, meets the requirement of the listing standards of the NYSE of having accounting or related financial management expertise. The Board of Directors has determined, upon the recommendation of the Governance Committee, that each member of the Audit Committee also meets the heightened standards of independence applicable to audit committee members as prescribed by the SEC.
The Audit Committee held nine meetings in 2021. It also held private sessions with our independent registered public accounting firm and the Internal Audit Director at several of its meetings. Our Internal Audit Director reports to the Chairman of the Audit Committee.
The “Report of the Audit Committee” is set forth beginning on page 62 of this Proxy Statement.
Compliance Committee
In addition to the risk oversight matters discussed under “Corporate Governance at 3D Systems—Strategy and Risk Oversight” above, the principal responsibilities of the Compliance Committee are to provide general oversight of the Company’s compliance with laws and regulations applicable to its business, including providing Board-level engagement and oversight of export compliance, government contracts, FDA compliance, ethics, and any necessary corrective actions pursuant to any export compliance investigation.
The Compliance Committee held four meetings in 2021.
Compensation Committee
In addition to the risk oversight matters discussed under “Corporate Governance at 3D Systems—Strategy and Risk Oversight” above, the principal responsibilities of the Compensation Committee are to:
determine the compensation of our CEO (the CEO may not be present during voting or deliberations regarding his compensation);
determine the compensation of all of our other executive officers, each a direct report of the CEO;
assist the Board in the development of executive succession plans.
administer our equity compensation plans and authorize the issuance of shares of Common Stock and other equity instruments under those plans; and
perform the duties and responsibilities of the Board of Directors under our 401(k) Plans.
The Board of Directors has determined, upon the recommendation of the Governance Committee, that each member of the Compensation Committee meets the heightened standards of independence applicable to compensation committee members as prescribed by the NYSE and is a “non-employee director” for purposes of Rule 16b-3 of the Securities Exchange Act of 1934, as amended, (the “Exchange Act”). The Compensation Committee held 10 meetings in 2021.
The “Compensation Committee Report” appears on page 40 of this Proxy Statement.
Compensation Committee Interlocks and Insider Participation
None of our current executive officers served during 2021 as a director of any entity with which any of our outside directors is associated or whose executive officers served as one of our directors, and none of the members of the Compensation Committee has been an officer or employee of the Company or any of our subsidiaries.
Retainer of Independent Compensation Consultant
The Compensation Committee has sole authority to retain, compensate, and terminate a compensation consultant to assist it in the evaluation of CEO or senior executive compensation. The Compensation Committee retained Meridian as its independent compensation consultant with respect to the Company’s 2021 executive compensation program. Meridian does not provide any other services to the Company, and the Compensation Committee has determined, based on its assessment of the relevant factors set forth in the applicable SEC rules,
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that Meridian’s work for the Compensation Committee does not raise any conflict of interest. For additional information on the role of the compensation consultant in setting executive compensation see “Executive Compensation—Compensation Discussion and Analysis—Compensation Consultant and Compensation Peer Group” on page 29.
Corporate Governance and Sustainability Committee
In addition to the risk oversight matters discussed under “Corporate Governance at 3D Systems—Strategy and Risk Oversight” above, the principal responsibilities of the Governance Committee are to:
assist the Board in identifying individuals qualified to become Board members;
assist the Board in determining the independence of the Board nominees;
recommend to the Board nominees to be elected at annual meetings of stockholders;
recommend to the Board nominees to fill vacancies or newly created directorships at other times;
recommend to the Board the corporate governance guidelines applicable to the Company;
lead the Board in its reviews of the performance of the Board and its committees;
recommend to the Board nominations of the directors to serve on each committee; and
monitor our environmental, social and governance strategy, policies and practices.
The Governance Committee held four meetings in 2021.
Technology Applications Committee
The principal responsibilities of the Technology Applications Committee are to:
review the Company’s technology strategy and approach, including its impact on the Company’s performance, growth, and competitive position;
review the Company’s technology capabilities and intellectual property and provide guidance on the Company’s technology and innovation strategy;
assess the Company’s technical workforce and its suitability for meeting needs, including engineering leadership and the development and succession planning process for critical technology experts;
review and advise on the Company’s research and development (“R&D”) expenditure plans; and
assist the Board in its oversight of the Company’s technology initiatives and investments, including through acquisitions and other business development activities.
The Technology Applications Committee held four meetings in 2021.
Other Board-Related Matters
Director Emeritus Program
The Board has created a Director Emeritus program to avail itself of the counsel of directors retiring from the Board due to age or term-limit restrictions who have made and can continue to make unique contributions to the deliberations of the Board. Under the program, the Board may, at its discretion, designate a retiring director as Director Emeritus to serve one or more annual terms subject to reappointment as Director Emeritus by the Board after each annual meeting of stockholders. A Director Emeritus may provide advisory services as requested from time to time and may be invited to attend meetings of the Board or its committees but may not vote, be counted for quorum purposes, have any of the duties or obligations imposed on our directors or officers under applicable law, or otherwise be considered a director.
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In conjunction with the implementation of a retirement age for directors, the Board determined to transition Mr. Hull, a founder of the Company and our current Executive Vice President and Chief Technology Officer for Regenerative Medicine, to Director Emeritus status following the Annual Meeting. The Board believes that Mr. Hull continues to provide valuable knowledge and leadership to the Company’s efforts in the field of regenerative medicine and other matters, and the Board recognizes the unique insight and guidance he can provide as a Director Emeritus.
Stockholdings of Directors
Among the factors considered under our “Corporate Governance at 3D Systems—Director Qualifications discussed on page 5 is an expectation that each director will hold during his or her term of office a meaningful number of shares of our Common Stock. Several of our directors beneficially own substantial numbers of shares of our Common Stock. See “Director Compensation—Stock Ownership and Holding Requirements for Non-Employee Directors” and “Security Ownership of Certain Beneficial Owners and Management” below.
Stockholder Communications with the Board of Directors
Stockholders and other interested persons may communicate with the Board by sending an email to BoardofDirectors@3DSystems.com or by sending a letter to the Board of Directors of 3D Systems Corporation, c/o Corporate Secretary, 333 Three D Systems Circle, Rock Hill, South Carolina 29730. We believe that providing a method for interested parties to communicate directly with our independent directors, rather than to the full Board, provides a more confidential, candid, and efficient method of relaying any interested party’s concerns or comments. The Chairman of the Board presides over independent executive sessions of directors. Accordingly, the Chairman may be contacted by any party by sending a letter to the Chairman of the Board of Directors of 3D Systems Corporation, c/o Corporate Secretary, 333 Three D Systems Circle, Rock Hill, South Carolina 29730.
All communications must contain a clear notation indicating that they are a “Stockholder-Board Communication” or a “Stockholder-Director Communication” and must identify the author.
The office of the Corporate Secretary will receive the correspondence and forward appropriate correspondence to the Chairman of the Board or to any individual director or directors to whom the communication is directed. We reserve the right not to forward any communication that is hostile, threatening, or illegal, does not reasonably relate to the Company or its business, or is similarly inappropriate. The office of the Corporate Secretary has authority to discard or disregard any inappropriate communication or to take any other action that it deems to be appropriate with respect to any inappropriate communications.
We also welcome communications from our stockholders that are consistent with applicable law and are initiated through our Investor Relations Department, which may be contacted at investor.relations@3dsystems.com.
Availability of Information
As noted above:
The Board of Directors has adopted a series of corporate governance documents, including Corporate Governance Guidelines, a Code of Conduct for our employees, a Code of Ethics for Senior Financial Executives and Directors, and a Related-Party Transaction Policy; and
Each standing committee of the Board operates under a written charter that has been approved by the Board.
Each of these documents is available online and can be viewed on our website by going to www.3DSystems.com and clicking on “Investor Relations,” then “Governance Documents” (from the drop-down menu under “Governance”) and selecting the appropriate document from the list on the web page.
In addition, we have:
Adopted a number of ESG policies and practices, including the Environmental, Health and Safety Policy, Water Policy, Waste Management Practices, and Human Rights and Labor Rights Policy; and
Disclosed a number of results relating to various ESG initiatives and sustainability.
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These documents and reports are available online and can be viewed on our website by going to www.3DSystems.com and clicking on “Sustainability.”
Information on, or that can be accessed through, our website is not, and shall not be deemed to be, a part of this Proxy Statement or incorporated into any other filings we make with the SEC.
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PROPOSAL ONE

ELECTION OF DIRECTORS
Skills, Qualifications and Diversity
Upon the recommendation of the Governance Committee, the Board has nominated the 10 individuals listed below to serve as directors until the 2023 Annual Meeting and until their successors are elected and qualified. Each of our director nominees currently serves on the Board and was elected to a one-year term at the 2021 Annual Meeting of Stockholders, except for Ms. Drayton, who was elected to the Board in December 2021. Messrs. Hull, Humes, and Wadsworth are not standing for re-election at the Annual Meeting. As a result, the Board will be reduced to 10 members immediately prior to the Annual Meeting. Proxies cannot be voted for a greater number of individuals than the number of nominees.
For each of the 10 nominees standing for election, the following pages set forth certain biographical information, including a description of their principal occupation, business experience, and the primary qualifications, attributes, and skills that the Board and the Governance Committee considered in recommending them for election to the Board. The following matrix highlights the mix of key skills, qualities, attributes, and experiences of each individual and is intended to depict notable areas of focus for each director, and not having a mark does not mean that a particular director does not possess that qualification or skill. Nominees have developed competencies in these skills through education, direct experience, and oversight responsibilities. The demographic information presented below is based on voluntary self-identification by each individual. Additional biographical information on each nominee begins on page 18.

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DIRECTOR NOMINEES
MALISSIA R. CLINTON, 53
Director Since 2019
 
Board Committees: Compliance, Corporate Governance
& Sustainability
Position, Principal Occupation and Professional Experience: Ms. Clinton has served as General Counsel of Meritage Homes Corporation, the sixth-largest public homebuilder in the United States, since April 2022 and previously served as Senior Vice President, General Counsel and Secretary at The Aerospace Corporation, a nonprofit corporation that provides technical guidance and advice on all aspects of space missions, from 2009 through March 2022. She worked at Northrup Grumman from 2002 to 2009, including as Senior Counsel for Special Projects beginning in 2007. Prior to joining Northrup Grumman, Ms. Clinton worked at TRW Space Technology, a division of TRW, Inc., as Counsel in its Telecommunication Programs and Avionic Systems division. She began her career as an Associate at Tuttle & Taylor.
Other Current Public Directorships: Progyny, Inc. (since November 2020).
Prior Public Company Directorships (within the last five years): None.
Other Directorships, Trusteeships and Memberships: Board of Directors of City of Hope Medical Center, the Arizona State University Foundation, and the National Defense Industrial Association.
Director Qualifications: The Governance Committee believes that Ms. Clinton’s strong experience in compliance matters and aerospace, a key vertical for the Company, provide clear support for her nomination for election to the Board.
WILLIAM E. CURRAN, 73
Director Since 2008
 
Board Committees: Audit, Compliance, Compensation
Position, Principal Occupation, and Professional Experience: Currently retired, Mr. Curran was the President and Chief Executive Officer at Philips Electronics North America Corp. from July 1999 to August 2002. Prior to that he served as Chief Financial Officer from February 1996 to July 1999. Previously, he served as Chief Operating Officer of Philips Medical North America, a medical device manufacturer, from February 1993 to February 1996.
Other Current Public Directorships: None.
Prior Public Company Directorships (within the last five years): Profound Medical (from 2012 to 2019).
Other Directorships, Trusteeships, and Memberships: Previously served as non-executive Chairman and director of Resonant Medical, an early-stage privately owned company specializing in three-dimensional ultrasound image-guided adaptive radio therapy products, until its acquisition by Elekta A.B., and as a director of Ventracor, a global medical device company which produced an implantable blood pump.
Director Qualifications: The Governance Committee believes that Mr. Curran’s wide experience in operations, finance, and executive management, both in the United States and abroad, provide clear support for his nomination for election to the Board.
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CLAUDIA N. DRAYTON, 54
Director Since 2021
 
Board Committees: Audit
Position, Principal Occupation, and Professional Experience: Ms. Drayton has served as the Chief Financial Officer of Quantum-Si, a life sciences tools company commercializing a unique protein sequencing platform, since April 2021. Previously, she served as Chief Financial Officer at CHF Solutions (now Nuwellis, Inc.), an early stage medical device company, from January 2015 to April 2021, where she led its transition from a research and development company to a commercial-stage entity and led multiple rounds of public equity offerings to finance its growth. Prior to joining CHF Solutions, Ms. Drayton spent 15 years with Medtronic plc, a global leader in medical devices, where she held multiple roles of increasing seniority, concluding with Chief Financial Officer and Senior Finance Director for Medtronic’s Integrated Health Solutions Business, where she was responsible for profitability management, acquisition integration, mergers, and acquisitions, planning and forecasting, management reporting, and business model innovation. Before joining Medtronic, Ms. Drayton was an audit and business advisory manager at Arthur Andersen LLP.
Other Current Public Directorships: None.
Prior Public Company Directorships (within the last five years): None.
Director Qualifications: The Governance Committee believes that Ms. Drayton’s extensive experience in key areas of healthcare and biotechnology as well as financial leadership in both public accounting and biotech companies provide clear support for her nomination for election to the Board.
THOMAS W. ERICKSON, 71
Director Since 2015
 
Board Committees: Compliance, Corporate Governance
& Sustainability
Position, Principal Occupation and Professional Experience: Mr. Erickson has been President and Chief Executive Officer of ECG Ventures, Inc., an investment firm, since 1988. Mr. Erickson has previously served as Chairman and Interim President and Chief Executive Officer of National Medical Health Card Systems, Inc., a publicly traded pharmacy benefits manager; Chairman of the Board of PathWays, Inc., an operator of post-acute care facilities; Chairman of the Board of TransHealthcare, Inc., a health care services company; Chairman and Interim Chief Executive Officer of LifeCare Holdings, Inc., an operator of long-term acute care hospitals; Interim President and Chief Executive Officer of Luminex Corporation, a publicly traded biotechnology company; Chairman of the Board of Inmar, Inc., a reverse logistics and revenue recovery company; chairman of the Board and Interim President and Chief Executive Officer of Western Dental Services, Inc., a dental practice management company; and Interim President and Chief Executive Officer of Omega Healthcare Investors, Inc., a publicly traded healthcare focused real estate investment trust. Mr. Erickson was also co-founder, President and Chief Executive Officer of CareSelect Group, Inc., a physician practice management company.
Other Current Public Directorships: None.
Prior Public Company Directorships (within the last five years): American Renal Associates Holdings, Inc. and Luminex Corporation.
Other Directorships, Trusteeships and Memberships: MGA Home Care, LLC and MW Industries, Inc.
Director Qualifications: The Governance Committee believes that Mr. Erickson’s extensive executive management and operational experience, particularly in the healthcare industry, provide clear support for his nomination for election to the Board.
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JEFFREY A. GRAVES, 60
Director Since 2020
 
Board Committees: None
Position, Principal Occupation, and Professional Experience: Dr. Graves has served as the Company’s President and Chief Executive Officer since May 2020. From 2012 to May 2020, he was CEO, President and Director of MTS Systems Corporation, a global supplier of test, simulation, and measurement systems. From 2005 until 2012, he served as President and CEO of C&D Technologies, Inc. Dr. Graves also held leadership roles with Kemet Corporation as Chief Operating Officer (2001 to 2003) and CEO (2003 to 2005). Previously he held a number of leadership and technical roles with GE, Rockwell and Howmet Corporation.
Other Current Public Directorships: Hexcel Corporation (since 2007).
Prior Public Company Directorships (within the last five years): Teleflex Incorporated (from 2007 to 2017); FARO Technologies (from 2017 to 2021).
Other Directorships, Trusteeships and Memberships: None.
Director Qualifications: The Governance Committee believes Dr. Graves’s extensive executive management, corporate strategy and international operational experience provides clear support for his nomination for election to the Board. Additionally, Dr. Graves has significant knowledge of the Company and the competitive environment in which it operates.
JIM D. KEVER, 69
Director Since 1996
 
Board Committees: Compensation, Corporate Governance
& Sustainability
Position, Principal Occupation and Professional Experience: Mr. Kever has been a Principal in Voyent Partners, LLC, a venture capital firm, since 2001. He previously served as President and Co-Chief Executive Officer of the Transaction Services Division of WebMD Corporation (formerly Envoy Corporation), an internet healthcare services company, from 1995 to 2001. Prior to 1995 he served as Envoy Corporation’s Executive Vice President, Secretary and General Counsel.
Other Current Public Directorships: Luminex Corporation (since December 1996).
Prior Public Company Directorships (within the last five years): None.
Other Directorships, Trusteeships and Memberships: None.
Director Qualifications: The Governance Committee believes Mr. Kever’s wide experience in operations, finance and executive management provides clear support for his nomination for election to the Board.
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CHARLES G. MCCLURE, JR., 68
Director Since 2017, Chairman Since 2018
 
Board Committees: Compliance
Position, Principal Occupation and Professional Experience: Mr. McClure has served as a Managing Partner of Michigan Capital Advisors, a private investment firm, since 2014 and has more than 35 years of experience in the transportation industry. Prior to founding Michigan Capital Advisors, Mr. McClure served as Chairman of the Board, Chief Executive Officer and President of Meritor, Inc. from 2004 through 2013. From 2002 through 2004, Mr. McClure served as Chief Executive Officer, President and a member of the Board of Federal Mogul Corp. Mr. McClure joined Federal Mogul in 2001 as president, Chief Operating Officer and a member of the Board. Before joining Federal Mogul, Mr. McClure served as President, Chief Executive Officer and a member of the Board of Detroit Diesel. He joined Detroit Diesel in 1997 after 14 years in a variety of management positions with Johnson Controls.
Other Current Public Directorships: DTE Energy Company (since 2012) and Crane Corporation (since 2017).
Prior Public Company Directorships (within the last five years): None.
Other Directorships, Trusteeships and Memberships: Member of the Board of Trustees of Henry Ford Health Systems; Member of the Board of Directors of Invest Detroit; and Member of the Business Leaders for Michigan.
Director Qualifications: The Governance Committee believes Mr. McClure’s broad experience in operations and executive management and significant expertise in the automotive industry, a key vertical for the Company, provide clear support for his nomination for election to the Board.
KEVIN S. MOORE, 67
Director Since 1999
 
Board Committees: Audit, Compensation
Position, Principal Occupation and Professional Experience: Mr. Moore has been with The Clark Estates, Inc., a private investment firm and a major company stockholder, for more than 30 years, where he is currently President and a director.
Other Current Public Directorships: None.
Prior Public Company Directorships (within the last five years): None.
Other Directorships, Trusteeships and Memberships: Aspect Holdings, LLC, The Clark Foundation, The National Baseball Hall of Fame & Museum, Inc., and Vice Chairman of the Board of Trustees of Bassett Healthcare Network.
Director Qualifications: The Governance Committee believes Mr. Moore’s wide experience in operations, finance and executive management and, as the president of a major stockholder, brings perspective on strategy and growth for the benefit of our stockholders, provide clear support for his nomination for election to the Board.
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VASANT PADMANABHAN, 55
Director Since 2020
 
Board Committees: Technology Applications
Position, Principal Occupation and Professional Experience: Dr. Padmanabhan has served as President Global Research & Development and as a member of the Executive Committee for Smith+Nephew, a global medical devices business operating in the markets for advanced surgical devices, since August 2016. Prior to joining Smith+Nephew, Dr. Padmanabhan served as Senior Vice President for Thoratec Corporation from June 2014 until its acquisition by St. Jude Medical, Inc. in October 2015. He served as a consultant to St. Jude Medical from October through December 2015 and took sabbatical until joining Smith+Nephew. Prior to joining Thoratec, Dr. Padmanabhan served in several roles of increasing responsibility for eighteen years with Medtronic plc in their Cardiac Rhythm Management business, including as Vice President of Product Development for the Implantable Defibrillator Business (2012 to 2014) and as Vice President of Connected Care R&D and Operations (2007 to 2012). Dr. Padmanabhan holds a Master of Science and a Doctorate degree in Biomedical Engineering from Rutgers University and a Master of Business Administration degree from the University of Minnesota – Carlson School of Management.
Other Current Public Directorships: None.
Prior Public Company Directorships (within the last five years): None.
Other Directorships, Trusteeships and Memberships: Dr. Padmanabhan is a member of the Trice Medical Board of Directors, a privately held medical technology company seeking to improve orthopedic diagnostics for patients and physicians.
Director Qualifications: The Governance Committee believes Dr. Padmanabhan’s specialized expertise in the healthcare industry, new product development and business development provides clear support for his nomination for election to the Board.
JOHN J. TRACY, 67
Director Since 2017
 
Board Committees: Compliance, Technology Applications
Position, Principal Occupation and Professional Experience: Dr. Tracy has more than 37 years of experience in the aerospace industry, most recently as Chief Technology Officer and Senior Vice President, Engineering, Operations and Technology at The Boeing Company, the world’s largest aerospace company. Dr. Tracy has strong leadership in technology, operations, quality and engineering gained from his experience from several aerospace companies, including Hercules Aerospace Company, McDonnell Douglas Corporation and The Boeing Company. From 2006 until 2016, he served as Chief Technology Officer and Senior Vice President, Engineering, Operations and Technology at The Boeing Company. Prior to that he served as Vice President, Engineering and Mission Assurance for Boeing Integrated Defense Systems and Vice President Structural Technologies, Prototyping and Quality of Phantom Works at The Boeing Company, after serving in roles of increasing responsibility at Hercules, McDonnell Douglas and The Boeing Company since 1979.
Other Current Public Directorships: None.
Prior Public Company Directorships (within the last five years): None.
Other Directorships, Trusteeships and Memberships: Member of the National Academy of Engineering and Member of the Board of Directors of The Aerospace Corporation.
Director Qualifications: The Governance Committee believes Dr. Tracy’s strong leadership experience and specialized expertise in aerospace engineering and manufacturing, structure and materials provide clear support for his nomination for election to the Board.
If any nominee becomes unavailable for any reason or if a vacancy should occur before the election, the holders of proxies may vote the shares represented by such duly executed proxies in favor of such other person as they may determine. Alternatively, in lieu of designating a substitute, the Board may reduce the number of directors.
The Board of Directors unanimously recommends that you vote FOR each of the nominees listed above.
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DIRECTOR COMPENSATION
We use a combination of cash and equity-based compensation to attract and retain qualified candidates to serve on our Board of Directors. In setting director compensation, we consider the significant amount of time that our directors expend in fulfilling their duties, the skill level required by us of members of our Board, and the overall level and mix of compensation compared to industry- and size-relevant peers by referencing data compiled by the Compensation Committee’s independent compensation consultant.
Director Compensation for 2021
The following table sets forth information concerning all compensation of each of our non-employee directors for their services as a director during the year ended December 31, 2021.
 
Fees Earned
or Paid in
Cash
($)
Stock
Awards(1)
($)
All Other
Compensation
($)
Total
($)
Malissia Clinton
75,000
149,995
244,995
William E. Curran
105,000
149,995
254,995
Claudia N. Drayton(2)
5,476
144,020
149,496
Thomas W. Erickson
68,091
149,995
218,086
William D. Humes
80,000
149,995
229,995
Jim D. Kever
71,909
149,995
221,904
Charles G. McClure, Jr
250,000
149,995
399,995
Kevin S. Moore
95,000
149,995
244,995
Vasant Padmanabhan
56,181
149,995
206,176
John J. Tracy
90,000
149,995
239,995
Jeffrey Wadsworth
75,000
149,995
224,995
(1)
Represents the aggregate grant date fair value of the restricted stock awards granted in 2021 to each non-employee director computed in accordance with stock-based accounting rules (Financial Standards Accounting Board (“FASB”) ASC Topic 718). The value of the restricted stock awards was determined by multiplying the number of shares awarded by the closing price of our Common Stock on the date of grant. Except for Ms. Drayton, the amounts in this column reflect the award of 6,007 shares of Common Stock made to each director in office as their annual equity award under the 2015 Incentive Plan on May 19, 2021. Such awards were valued based on the closing market price of our Common Stock on the date of grant ($24.97 per share). For Ms. Drayton, the amounts included in this column reflect an initial grant of 3,516 shares of Common Stock and an interim grant of 3,236 shares of Common Stock made upon the effective date of her election to the Board, December 1, 2021, and valued based on the closing market price of our Common Stock on that date ($21.33 per share).
(2)
Ms. Drayton was elected to the Board effective December 1, 2021. The cash amount disclosed is her prorated fees earned for service during the portion of 2021 in which she served as a director.
Director Fees
Director compensation is set by the Board, based upon the recommendation of the Governance Committee through the periodic review and approval of the Non-Employee Director Compensation Policy. Effective as of the conclusion of the 2021 Annual Meeting, we began to pay the following cash compensation to our non-employee directors:
The Chairman of the Board of Directors receives a fee of $250,000 per annum for such service.
Non-employee directors (other than the Chairman of the Board) receive an annual retainer of $50,000.
The Chairman of the Audit Committee, the Compensation Committee, and the Technology Applications Committee each receive an annual retainer of $30,000.
The Chairman of the Compliance Committee receives an annual retainer of $20,000, and the Chairman of the Governance Committee receives an annual retainer of $10,000.
Each member of the Audit Committee and the Compensation Committee (in each case, other than the Chairman) receives a $15,000 annual retainer.
Each member of the Compliance Committee and the Technology Applications Committee (in each case, other than the Chairman) receives a $10,000 annual retainer.
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Each member of the Governance Committee (other than the Chairman) receives a $5,000 annual retainer.
As discussed below, non-employee directors also receive annual equity awards. We also reimburse directors for their expenses of attendance at meetings of the Board of Directors or its committees.
Directors who are employees of the Company (Dr. Graves and Mr. Hull) received no additional compensation for service as a director in 2021.
Director Equity Awards
Pursuant to the Non-Employee Director Compensation Policy, our directors receive annual grants of immediately vested restricted stock equal to $150,000 in total value under the 2015 Incentive Plan upon their re-election by stockholders to serve as directors. In addition, new directors, upon their election to the Board, receive a restricted stock award equal to such number of shares having a value equal to $75,000 and a prorated annual award for the year in which he or she is elected to the Board. All shares of Common Stock issued to directors as compensation for their services as directors are fully vested when issued.
Stock Ownership and Holding Requirements for Non-Employee Directors
Consistent with the Board-adopted Qualifications for Nomination to the Board (publicly disclosed as Addendum A to the Governance Committee Charter), each non-employee director is expected to hold during his or her term of office a meaningful number of shares of Common Stock. As such, our Corporate Governance Guidelines require our non-employee directors to acquire and maintain an equity stake in the Company with a minimum value equivalent to five times the annual cash retainer paid to non-employee directors (as set forth in the Non-Employee Director Compensation Policy) by 2025 or within 5 years of joining the Board.
Each of our non-employee directors are required to retain all shares of Common Stock that have been awarded to them under the 2015 Incentive Plan until the minimum holding requirement is met; however, they may sell up to 50% of the shares of Common Stock covered by any award to satisfy any tax obligation arising from such grant or grants. In addition, non-employee directors are required to retain all shares of Common Stock that were awarded to them under the 2004 Directors Stock Plan (which was depleted in 2019) as long as they remain a director of 3D Systems; however, they may (a) sell up to 50% of an award to cover the tax obligation arising from such grant or grants and (b) make certain transfers of shares received under the 2004 Directors Stock Plan to members of their immediate family or to a trust or other form of indirect ownership established by the director for his or her benefit or for the benefit of the members of his or her immediate family.
2015 Incentive Plan
Non-employee directors are also eligible to receive grants of Common Stock under the 2015 Incentive Plan, which was originally approved by our stockholders in May 2015 and most recently amended and restated in September 2020. Subject to adjustment from time to time, shares of Common Stock with a grant date fair value of not more than $250,000 in the aggregate may be made subject to awards under the 2015 Incentive Plan in respect of any non-employee director during any year.
The 2015 Incentive Plan authorizes the issuance of up to 18,300,011 shares of Common Stock for awards under the 2015 Incentive Plan, subject to further adjustment in the event of changes in the Common Stock by reason of any stock dividend, stock split, combination of shares, reclassification, recapitalization, merger, consolidation, reorganization, or liquidation. As of the date of this Proxy Statement, 944,587 shares of Common Stock remained available for issuance under this 2015 Incentive Plan. As set forth in “Proposal 3—Approval of the Amendment and Restatement of the 2015 Incentive Plan” below, the Company is seeking stockholder approval to, among other things, add 6,935,000 new shares of Common Stock to the pool of shares available for awards under the 2015 Incentive Plan.
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EMPLOYEE COMPENSATION MATTERS
We view compensation as one part of our employees’ total rewards they receive in exchange for committing their time and talent to the Company. We design our compensation programs to be competitive and equitable to support employees in sharing in the success of 3D Systems, and tailor our compensation programs to attract and retain top talent to drive success in our current business priorities and emerging strategies. Additionally, we recognize that employees thrive when they have the resources to meet their needs and the time and support to succeed in their professional and personal lives. In support of this, we offer a wide variety of market competitive benefits to employees around the world.
We have established a consistent and unified market-based job architecture that serves as the framework for all employee compensation decisions Company-wide. All employees receive base compensation, either as hourly or annual amounts, and have the opportunity to participate in a short-term incentive plan, either as part of the annual bonus program based on Company performance or a sales incentive plan based on sales related goals. Some employees also have the opportunity to participate in the Company’s various long-term equity incentive plans.
Except with respect to his own compensation, our CEO oversees our employee compensation programs and makes recommendations to the Compensation Committee with respect to the compensation of each of his direct reports and other Section 16 officers.
As discussed above under “Corporate Governance at 3D Systems–Strategy and Risk Oversight–Risk Assessment of Compensation Policies and Practices,” we believe that our compensation practices do not create inappropriate or unintended risks and that any risks that do exist are not reasonably likely to result in a material adverse effect on us. We endeavor to manage any of these risks that may arise through our system of internal financial and operational controls and the Board and management oversight processes.
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EXECUTIVE COMPENSATION
Compensation Discussion and Analysis
This Compensation Discussion and Analysis provides detailed information and analysis regarding the compensation of our named executive officers (“NEOs”) as reported in the Summary Compensation Table and other tables located in this “Executive Compensation” section of the Proxy Statement.
Our Named Executive Officers for 2021
Name
Title
Dr. Jeffrey A. Graves
President, Chief Executive Officer and Director
Jagtar Narula
Executive Vice President and Chief Financial Officer
Menno Ellis
Executive Vice President, Healthcare Solutions
Andrew M. Johnson
Executive Vice President, Chief Legal Officer and Secretary
Reji Puthenveetil
Executive Vice President, Industrial Solutions
Business Profile
Our corporate purpose is to deliver leading additive manufacturing solutions for Industrial and Healthcare applications. Over the course of the last 18 months, we executed an aggressive four-phased plan to reorganize, restructure, divest non-core assets, and invest for accelerated growth. This plan was completed in the third quarter of 2021 including reorganizing into two business units, Healthcare Solutions and Industrial Solutions, restructuring to gain efficiencies, and divesting non-core assets. Our two key verticals span a range of industries. Healthcare Solutions includes dental, medical devices, personalized health services, and regenerative medicine. Industrial Solutions includes aerospace, defense, transportation, and general manufacturing.
After completion of our transformation activities, we prioritized our focus on driving innovation, performance, and reliability and empowering our customers to create products and models never before possible. We provide full-service solutions, powered by the experience of our application engineers who collaborate with customers to transform how they deliver their products and services.
2021 Business Performance
The dedicated work of our teams and successful execution against our four-phased strategy is reflected in our 2021 financial results. 2021 revenue of $615.6 million is an increase of 10.5% compared to 2020 revenue. Adjusted for divestitures, revenue* increased 31.8% from 2020 and 16.9% from pre-pandemic 2019. Our Healthcare Solutions and Industrial Solutions segments revenue, adjusted for divestitures*, grew 40.1% and 24.4%, respectively, from 2020 reflecting success of the Company’s vertical and applications focused approach.
Revenue growth, disciplined cost management, and focused operational execution resulted in higher operating income, adjusted EBITDA, and non-GAAP earnings per share for 2021 compared to both 2020 and pre-pandemic 2019.
Gross profit margin for the full year 2021 was 42.8% compared to 40.1% in the prior year. Additionally, we generated $48.1 million of cash from operations in 2021.

*
See Appendix A for reconciliations of GAAP to non-GAAP financial measures.
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Compensation Philosophy
Our compensation philosophy is centered upon pay for performance to drive long-term value for our stockholders. We believe that deep industry experience and technical knowledge is critical to our ability to innovate and provide full-service solutions to our customers and that the expertise of our executives and employees are critical factors to the Company’s success. The competition for talent in our industry is highly competitive and we are exceptionally focused on attracting, rewarding, and retaining executive talent. Our executive compensation program and practices reflect the Board’s commitment to strong corporate governance and achievement of rewards based upon the creation of sustainable Company value.
We pursue this philosophy by designing our executive compensation program incorporating the following principles:
Alignment with long-term stockholders’ interests. We believe our executives’ interests are more directly aligned with our stockholders’ interests when compensation programs emphasize an appropriate balance of short- and long-term financial performance, are impacted by our stock price performance and require meaningful ownership of our stock.
Market competitive at target performance levels. We believe an executive’s total compensation should be competitive at the target performance level in order to attract qualified executives, motivate performance and retain, develop and reward executives with the abilities and skills needed to foster long-term value creation.
Achievement of financial goals and strategic objectives. We believe an effective way to create value over the long-term is to make a significant portion of an executive’s overall compensation dependent on the achievement of our short- and long-term financial goals and strategic objectives and on the value of our stock.
Reward superior performance. We believe that although an executive’s total compensation should be tied to achievement of financial goals and strategic objectives and should be competitive at the target performance level, performance that exceeds target should be appropriately rewarded. We also believe there should be downside risk of below-target payouts if our financial performance is below target and if we do not achieve our financial goals and strategic objectives.
Incorporate evolving marketplace risks and trends. We believe that as our industry evolves and our opportunities for competitive business advantages change over time, we must likewise evolve in order to continue to create value. Our compensation programs must likewise be tailored to our strategic priorities (which may require changing the performance measures in our incentive plans) and our current outlook (which may impact how we calibrate incentive plan payouts to various levels of performance).
The key elements of our compensation programs for our NEOs include:
Compensation Component
Purpose
Base Salary
• Provide a competitive fixed rate of pay relative to similar positions in the market
• Enable the Company to attract and retain critical executive talent
Representing the only fixed element of total compensation
 
 
Short-Term Incentives
• Focus NEOs on achieving progressively challenging short-term performance goals that align with the Company’s annual operating plan and result in long-term value creation
Cash-settled and tied to the achievement of annual Company financial goals
 
 
Long-Term Incentives
• Align the interests of NEOs with those of stockholders and support the Company’s executive retention strategy
Comprised of a selection of equity instruments and vesting criteria tailored to promote long-term alignment of pay with stockholders
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Key Compensation Actions in 2021
Our Compensation Committee, which consists entirely of independent directors, sets the compensation of our NEOs. For 2021, the Compensation Committee took the following actions with respect to the compensation of our NEOs:
Reviewed the base salaries for our NEOs as part of our standard annual review cycle, approving increases of 3% for each NEO.
Reviewed the 2021 Annual Bonus Program percentage of base salary targets for our NEOs, increasing the target percentages from 2020 for all NEOs other than the CEO (100% of base salary for Dr. Graves and 60% of base salary for each of our other NEOs).
Approved Annual Bonus Program metrics for 2021, weighting funding of the bonus program pool 50% towards revenue achievement and 50% towards adjusted EBITDA achievement.
Based on the Company’s 2021 performance against established revenue and adjusted EBITDA metrics, approved a 150% of target payout for each NEO under the 2021 Annual Bonus Program.
Approved Long-Term Incentive (“LTI”) compensation, consisting of a combination of restricted stock awards (50% weighting) and performance share unit awards (50% weighting) to provide strong links to long-term stockholder value creation and promote alignment with investors.
Determining Executive Compensation
The Compensation Committee is responsible for setting the compensation of all executive officers, including the NEOs. It is also responsible for setting the compensation of each other officer of the Company subject to Section 16 of the Exchange Act (“executive officers”) and each direct report of the CEO. For additional information about the responsibilities of the Compensation Committee, see “Corporate Governance at 3D Systems—Meetings of the Board and its Committees—Compensation Committee” above.
The Compensation Committee reviews the CEO’s recommendation for each of the other NEO’s compensation during the first quarter of each year. The purpose of this annual review is:
to determine the amount of any annual incentive compensation to be awarded to each NEO for the preceding calendar year;
to determine any adjustments to be made to the annual salary of each NEO for the current year; and
to approve our incentive compensation program for the current year and establish target incentive compensation amounts for the current calendar year for each of the NEOs.
As part of this review, our CEO gives the Compensation Committee a recommendation for incentive compensation payouts for the prior year, salary adjustments for the current year, and target incentive compensation amounts for the current year for each of the other NEOs. These recommendations are developed using our market-based job architecture for all employees to ensure appropriate levels of pay at each employee classification across the Company. Our CEO uses the market-based job architecture and evaluation of each individual NEO’s contribution to strategic objectives to guide his compensation recommendations to the Compensation Committee. The Compensation Committee reviews those recommendations and modifies them to the extent it considers appropriate. As part of this process, the Compensation Committee approves the payout amount of any annual incentive compensation to be awarded to each individual with respect to the preceding calendar year, approves the amount of any adjustments to be made to the annual salary of each such individual for the current year, approves the terms of our incentive compensation program for the current calendar year, and establishes target incentive bonus and equity awards for the current year for each of our NEOs and each of the other individuals whose compensation it oversees. The Compensation Committee may also approve adjustments to compensation for specific individuals at other times during any year when there are significant changes in the responsibilities of such individuals or under other circumstances that the Compensation Committee considers appropriate.
Our CEO’s compensation is determined under similar principles but follows a different process. This process is designed to comply with applicable law and listing requirements under which, after discussing his self-evaluation with him and receiving the views of other independent directors, the Compensation Committee evaluates his performance, reviews the Compensation Committee’s evaluation with him, and based on that
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evaluation and review, determines his compensation and personal annual incentive objectives. Our CEO is excused from meetings of the Compensation Committee and the independent members of the Board during voting or deliberations regarding his compensation.
Compensation Consultant and Compensation Peer Group
For 2021, the Compensation Committee directly engaged Meridian and considered its guidance in the establishment of the 2021 executive compensation program. Meridian provided no services to the Company other than to the Compensation Committee. Based on its consideration of the various factors set forth in the rules promulgated by the SEC and the NYSE Exchange Rules, the Compensation Committee has determined that the work performed by Meridian has not raised any conflict of interest.
In September 2020, Meridian assisted the Compensation Committee in developing a peer group to serve as a market reference for establishing and evaluating the 2021 compensation programs for our NEOs. Our 2021 peer group was composed of 15 publicly traded, industry-specific companies. Companies selected are generally one-half to two times our revenue and one-third to three times our market capitalization, with some exceptions to foster year-over-year continuity or to include companies that are clear product and service competitors or likely to compete with us for executive talent. These companies were selected after the consideration of the following criteria:
quantitative criteria, including revenue size and growth, margins, market cap, headcount and R&D spend;
qualitative criteria, including service and product offerings and end markets served; and
likely competitors for executive talent.
The 2021 peer group included:
ADTRAN, Inc.
Natus Medical Incorporated
Avid Technology
Novanta Inc.
CONMED Corporation
Proto Labs, Inc.
Extreme Networks, Inc.
Stratasys Ltd.
FARO Technologies, Inc.
Varex Imaging Corporation
Harmonic Inc.
Veeco Instruments Inc.
iRobot Corporation
Viavi Solutions, Inc.
Mercury Systems, Inc.
 
Four companies (Integra LifeSciences Corp., Penumbra, Inc., Plantronics, Inc. and Pure Storage, Inc.) were removed from our 2021 peer group roster in part to improve our alignment with the peer group medians for size and valuation statistics. The new additions to the peer group roster for 2021, Natus Medical, Novanta, Stratasys, Varex Imaging and Veeco Instruments, were added to provide a slightly more robust sample size and increase the representation of companies developing solutions for the healthcare market.
The Compensation Committee determines the appropriate level of both specific elements of and total compensation for our NEOs by considering numerous competitive, performance, and other factors, including the Radford Global Technology Survey data for technology companies.
Relative to the peer or industry group, the Compensation Committee targets each element of executive compensation generally near the 50th percentile. Variation in competitive positioning by executive will occur based on a consideration of factors including experience, the scope and complexity of the executive’s position relative to what is typical in the market, tenure, and other contributions.
Say-on-Pay
We provide stockholders with an advisory vote (“say-on-pay”) on the compensation of our NEOs. We currently hold this say-on-pay vote on an annual basis. At the 2021 Annual Meeting, approximately 93% of the votes cast on this proposal approved the compensation of our NEOs on an advisory basis. The Compensation Committee considered the stockholders’ strong support of our say-on-pay vote at the 2021 Annual Meeting when designing our executive compensation program for 2021. The Compensation Committee will consider the results of future advisory votes on executive compensation as our compensation philosophy continues to evolve and compensation decisions are made each year.
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Elements of Executive Compensation
Our executive compensation program is designed to focus executive behavior on achievement of both our short- and long-term objectives and strategy to encourage the creation of sustainable, long-term value. We provide a mix of compensation elements that support our goals of attracting and retaining top executive talent and incentivizing key performance objectives for both the short and long term. The elements of executive compensation are designed to drive behavior that supports sustained stockholder return and pay-for-performance outcomes over time. To that end, our executive compensation program consists of the following principal elements:
annual base salaries;
when earned, incentive awards under our Annual Bonus Program; and
long-term equity compensation under our 2015 Incentive Plan.
Initial base salary and target annual bonus award levels and initial equity awards for new executives are negotiated with the individual during the search process and include consideration of prior compensation history, outstanding incentive awards that the new executive must abandon in order to join the Company, and benchmarking information and recommendations provided by the independent compensation consultant. Annual bonus compensation levels are standardized by title to promote internal parity.
In reviewing annual base salaries, target annual bonus awards, and annual long-term equity compensation levels, the Compensation Committee reviews each executive’s compensation history with the Company (including prior equity awards or grants), benchmarking information and recommendations provided by the independent compensation consultant, and internal parity. The Compensation Committee is guided by its own judgment and those sources of information (including, when deemed appropriate, compensation surveys) that the Compensation Committee considers relevant and the recommendations of its compensation consultant.
The Compensation Committee believes that the prudent use of judgement in determining compensation will generally be in our best interests and those of our stockholders. Accordingly, the Compensation Committee does not rely exclusively upon fixed formulas and, from time to time in exercising its judgement, the Compensation Committee may approve changes in compensation that it considers to be appropriate to award performance or otherwise to provide incentives toward achieving our objectives.
The Compensation Committee seeks to strike a balance that it considers to be appropriate in its discretion between fixed elements of compensation, such as base salaries, and variable performance-based elements represented by annual bonus awards and long-term equity compensation. As a general matter, the Compensation Committee believes that our NEOs should have at least one-third of their annual cash compensation opportunity at risk under variable performance-based elements of our incentive compensation program, including, in particular, our Annual Bonus Program.
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The charts below illustrate the relative weighting of our NEO compensation components at target in 2021. Dr. Graves’ compensation is displayed for “Components of CEO Compensation” and the weighted average of our other NEOs is displayed for “Components of Other NEO Compensation.”

Target Annual Bonus represents target opportunities for each NEO under the 2021 Annual Bonus Program. See “2021 Annual Bonus Program” below for further details.
Target Performance-Based Equity (50% of each NEO’s Long-Term Incentive Award) represents target value of PSUs as approved by the Compensation Committee, which may be earned based on TSR performance over a 3-year performance period.
Restricted Stock (50% of each NEO’s Long-Term Incentive Award) represents target value of time-based restricted stock, which vests ratably over 3 years.
Base Salaries
Annual base salaries are intended to provide a base level of compensation to executives, including our NEOs, for serving as senior leaders of the Company and are aligned with the level of experience, capabilities, and scope of responsibilities of the executive. We pay annual salaries to provide executives a base level of compensation for services rendered during the year. Base salaries are also designed to help achieve our objectives of attracting and retaining executive talent. Adjustments to base salaries are based on the Company’s market-based job architecture, which takes into consideration the responsibilities of the executives, the Compensation Committee’s evaluation of the market demand for executives with similar capability and experience, and each individual NEO’s progress towards assigned strategic imperatives and concrete personal objectives.
2021 Salaries
The following table shows the 2021 annual base salary amounts for each NEO.
Name
2020 Year-End
Base Salary
($)
2021 Year-End
Base Salary
($)
Aggregate %
Increase
Jeffrey A. Graves
825,000
849,800
3.0
Jagtar Narula
400,000
412,000
3.0
Menno Ellis
400,000
412,000
3.0
Andrew M. Johnson
374,000
385,300
3.0
Reji Puthenveetil
400,000
412,000
3.0
The Compensation Committee maintained 2021 base salaries for all NEOs at the same levels in effect at the end of 2020 through June 2021. The Compensation Committee approved a Company-wide merit increase of 3% for all employees, including our NEOs, effective July 2021 in recognition of the Company’s strong financial performance in the first half of 2021.
Annual Bonus Program
Our Annual Bonus Program is designed to motivate our executives, including our NEOs, to achieve defined financial performance targets which can be measured and evaluated on an annual basis.
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This program is adopted annually and designed with our strategic objectives in mind. The Annual Bonus Program is designed so that the pool available for payout thereunder is based 100% on the achievement of pre-determined corporate financial objectives established during the Company’s annual financial planning process. Under the Annual Bonus Program, if the pre-determined corporate financial objectives are achieved and the pool is funded, the allocation of the pool among participants is based on each participant’s level within the Company’s job architecture. Annual bonus awards are not guaranteed and are not awarded unless the pre-determined corporate financial objectives are achieved at pre-defined levels. Even if the pre-determined corporate financial objectives are achieved, our Compensation Committee retains discretion to reduce the funding of the Company-wide annual bonus plan pool or any individual participant’s award. This pay-for-performance plan aligns executive performance with the Company’s annual financial performance.
As an overriding condition, a failure to perform in accordance with our Code of Conduct or Code of Ethics may serve as a basis for a participant in this program not to receive a bonus payout. We consider this aspect of our Annual Bonus Program to be consistent with sound principles of corporate governance.
As part of its goal-setting process, the Compensation Committee establishes current-year target incentive awards for each NEO with the following principles in mind:
Targets are used to determine the amount of any annual bonus that our NEOs can expect to receive if we achieve our financial objectives for the year in question. In setting these target bonus awards, the Compensation Committee considers each NEO’s level of responsibility and the recommendations of our CEO.
Target bonus awards are set at levels that are designed to link a substantial portion of each NEO’s total annual compensation opportunity to attaining the corporate objectives. Although generally higher, the Compensation Committee aims for at least one-third of each NEO’s annual cash compensation opportunity to be at risk. See “Grants of Plan-Based Awards in 2021” below for a summary of target bonus awards for the NEOs applicable to 2021.
No minimum incentive awards are guaranteed to NEOs. The pool for the annual incentive plan is not funded unless the Company achieves certain pre-determined financial objectives.
Base target amounts represent the bonus awards that could be awarded assuming achievement of 100% of the pre-determined financial objectives.
Maximum amounts represent the maximum amount that may generally be awarded to each NEO under the program for the year in question. Our maximum annual incentive awards were equal to 150% of the target annual bonus awards for each of our NEOs during 2021.
Financial objectives are determined based on our business plan for the year in question. This business plan is developed by management and approved by the Board of Directors. The Compensation Committee maintains the ability to adjust performance objectives for extraordinary items and other items as it deems appropriate based on pre-approved guidelines the Compensation Committee has set regarding the potential impact to performance objectives due to extraordinary transactions.
With respect to financial measures, 100% of each NEO’s bonus related to each financial measure would generally be deemed to have been earned if the target for that financial measure is fully achieved.
2021 Annual Bonus Program
Consistent with the principles discussed above, in December 2020, the Compensation Committee approved an annual bonus program for 2021. The 2021 target bonus awards for each NEO were set at 60% of their 2021 base salaries, except for Dr. Graves whose 2021 target incentive award was set at 100% of his 2021 base salary. The 2021 threshold and maximum annual bonus award for all NEOs were set at 50% and 150%, respectively, of the target annual bonus award.
The Compensation Committee approved the following performance objectives, selected to reflect the Company’s focus on top-line revenue growth and alignment with investor focus and strategic business plan priorities, for the funding of the 2021 Annual Bonus Program:
50% of the funding of the 2021 Annual Bonus Program pool was based on the achievement of our annual revenue budget; and
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50% of the funding of the 2021 Annual Bonus Program pool was based on the achievement of our annual budgeted level of adjusted EBITDA.
Each performance objective is independent of the other and could be earned irrespective of achievement of the other objective. The Compensation Committee set revenue and adjusted EBITDA goals for 2021 consistent with the Company’s consolidated budget approved by the Board, with revenue targeted at $545.4 million and adjusted EBITDA targeted at $40.9 million, noting that performance assessments should be adjusted for impact of any lost or gain to revenue or EBITDA due to divestitures (or any significant corporate actions taken in response to divestitures or acquisitions) in 2021. The Compensation Committee further determined that partial payout could be earned based upon 80% and 60% achievement of revenue and adjusted EBITDA targets, respectively, which would payout at 25%, and that payout above target could be earned based upon 110% and 120% achievement of revenue and adjusted EBITDA targets, respectively, which would payout at 150% of target.
In the third quarter of 2021, we completed our four-phase plan to deliver increased long-term value to our stockholders with the completion of divestitures of parts of the business that do not align with our strategic focus. These divestitures of non-core assets were an important step in our plans to refocus on our core mission and enable deployment of our investment efforts on additive manufacturing solutions. To reflect the impact of these divestitures, the Company revised its 2021 consolidated budget to update expectations for both top-line and bottom-line growth of our core business. The net impact of the budget adjustments resulted in a decrease of budgeted full year revenue for 2021 from $545.4 million to $511.1 million(1) and an increase in budgeted full year adjusted EBITDA for 2021 from $40.9 million to $49.0 million.(2)
The Compensation Committee set the financial objectives for the Annual Bonus Program based on our 2021 business plan. Budget adjustments to the Annual Bonus Plan were approved by the Compensation Committee, which comprised a decrease in budgeted revenue and an increase in budgeted adjusted EBITDA. The Compensation Committee determined that adjustments to the financial objectives for the Annual Bonus Program were in the best interest of both the Company and stockholders, as these adjustments were made to accurately reflect the financial goals of the core business for the year. Specifically, the Compensation Committee approved a decrease of the revenue target for the 2021 Annual Bonus Program from $545.4 million to $511.1 million and an increase of the adjusted EBITDA target for the 2021 Annual Bonus Program from $40.9 million to $49.0 million. The final terms of the 2021 Annual Bonus Program are summarized below:
2021 Bonus Plan
Payout Curve
25%
Payout
50%
Payout
100%
Payout
150%
Payout
Revenue
 
 
 
 
Perf Goals
$408.8
$459.9
$511.1
$562.2
Perf Goals as % of Target
80%
90%
100%
110%
Adjusted EBITDA
 
 
 
 
Perf Goals
$29.4
$39.2
$49.0
$58.8
Perf Goals as % of Target
60%
80%
100%
120%
(1)
Adjustments to revenue included the impact of certain divestitures (-$39.0 million) and R&D reimbursements ($4.7 million).
(2)
Adjustments to adjusted EBITDA included the impact of divestitures (-$9.3 million), payout of 2021 annual bonus amounts in equity versus cash to certain employees ($15.0 million) and increase of cash bonus amounts ($2.0 million).
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The results of the Company’s 2021 financial performance were measured against these pre-established performance goals after the completion of the Company’s 2021 audit. For 2021, revenue was reported at $615.6 million and adjusted EBITDA was reported at $74.1 million. These results exceeded maximum performance goals resulting in approval by the Compensation Committee to fund the 2021 annual bonus pool at 150% of target. Eligible participants under the 2021 Annual Bonus Program, including our NEOs, received their awards in shares of immediately vested Common Stock in lieu of cash as follows:
Name
Payment
Amount(1)
($)
Shares of
Common
Stock Issued
(#)
Jeffrey A. Graves
1,274,700
80,626
Jagtar Narula
370,800
23,453
Menno Ellis
370,800
23,453
Andrew M. Johnson
346,770
21,933
Reji Puthenveetil
370,800
23,453
(1)
Represents payout of 150% of target Annual Bonus Award. The number of immediately vested Common Stock awarded was determined by dividing the payout amount by the closing price of our common stock ($15.81) on March 3, 2022, the date of grant, rounded down to the nearest whole share.
Long-Term Equity Compensation
Our long-term equity compensation program is designed to attract, retain and motivate our executives, including our NEOs, and to align their interests with those of our stockholders and the Company’s long-term strategic objectives. Our equity program is a key component in our strategy to hire and retain top talent in a highly competitive environment.
The Compensation Committee administers our 2015 Incentive Plan. Under that plan, the Compensation Committee is authorized to grant restricted stock awards, restricted stock units (“RSUs”), stock options, stock appreciation rights and other awards that are provided for under the 2015 Incentive Plan to our employees and the employees of our subsidiaries as the Compensation Committee determines to be eligible for awards. Awards granted to a participant are based upon a number of factors, including the recipient’s position, salary and performance, as well as our overall corporate performance.
The 2015 Incentive Plan is intended to provide an effective method of motivating performance from key employees, including our NEOs, and for creating an alignment of interests in participants with the interests of our stockholders. Awards are made under the 2015 Incentive Plan as long-term incentive compensation to NEOs and other key employees when the Compensation Committee believes such awards are appropriate. The Compensation Committee makes awards both to reward performance and to motivate the recipient’s long-term performance.
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Long-Term Incentive Compensation Program
The Compensation Committee divides long-term equity grants for executives equally between restricted stock awards with time-based vesting conditions and performance share units (“PSUs”). Time based awards are used to drive retention of executive talent, while PSUs drive alignment of executive performance with long-term stockholder value. The PSUs typically are granted in the first quarter of the performance year, upon completion of the budgeting process to support the selection of appropriate performance targets. Historically, PSU awards can only be earned by the NEOs upon our achievement of pre-determined levels of financial performance. The long-term equity target compensation amounts approved for each of our NEO’s 2021 LTI awards were as follows:
Name
2021 LTI
Award at
Target(1)
($)
Jeffrey A. Graves
2,750,000
Jagtar Narula
1,000,000
Menno Ellis
1,000,000
Andrew Johnson
850,000
Reji Puthenveetil
1,000,000
(1)
See “2021 Long-Term Incentive Awards” below for further details on these 2021 LTI awards.
Long-Term Equity Features
Restricted stock awards and PSU awards issued pursuant to the 2015 Incentive Plan remain subject to forfeiture until the vesting of such shares pursuant to the terms of the applicable award.
Shares of restricted stock, RSUs, and PSUs issued pursuant to the 2015 Incentive Plan may not be sold, transferred or encumbered by the employee before they vest or are earned, as applicable. The compensation associated with these awards is expensed over the vesting period. The shares covered by restricted stock awards are considered outstanding upon issuance following the acceptance of each award for the purpose of calculating diluted earnings per common share, and holders of shares issued pursuant to restricted stock awards are entitled to vote such shares and to receive any dividends declared in respect of our Common Stock upon vesting of the award shares. Shares covered by RSUs and PSUs are not considered outstanding until vested except, in each case, for the purpose of calculating diluted earnings per common share. The holders of PSUs are not entitled to vote shares or receive any dividends declared with respect to the shares covered by such awards.
2021 Long-Term Incentive Awards
In January 2021, the Compensation Committee made LTI awards of restricted stock and PSUs under the 2015 Incentive Plan to executives, including the NEOs, to reflect the contributions that those individuals have made to our operations and financial condition, to provide motivation toward achieving our future strategic objectives and to further align the interests of those individuals with our stockholders. Restricted stock awards vest ratably over three years beginning on the first anniversary of the date of grant. The performance share units only vest if both performance and service-based criteria are met.
The Compensation Committee approved the use of absolute total stockholder return (“TSR”) as the performance objective for the 2021 PSUs awarded to our NEOs. The transition from Company-specific financial objectives to a market-based measure reflected the desire to focus executives on the execution of the Company’s long-term strategic objective to increase stockholder value. TSR will be assessed as a specified percentage increase in the price of the Company’s Common Stock over the average closing price of the Company’s Common Stock for the 20 consecutive trading days ended January 11, 2021, which was $13.00. Specifically, a 50% increase will earn 50% of the target PSUs, a 75% increase will earn 100% of the target PSUs and a 100% increase will earn 150% of the target PSUs. Each price hurdle must be met for 10 consecutive trading days, and price hurdles may be met at any time during the performance period ending on the third anniversary of the date of grant. At the end of the performance period, if the performance-based criteria are met, all PSUs earned will convert into immediately vested stock.
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In determining 2021 LTI target award amounts, the Compensation Committee considered corporate performance, competitive market data for each individual, the level of the individual’s responsibility, prior compensation and retentive impact of that prior compensation and individual contributions to the Company. The restricted stock awards and target PSUs made to our NEOs in January 2021 were as follows:
Name
Restricted
Stock
(#)
Target
Performance
Share Units
(#)
Aggregate
Fair
Market
Value of
Grants(1)
($)
Jeffrey A. Graves
105,748
105,748
6,378,719
Jagtar Narula
38,454
38,454
2,319,545
Menno Ellis
38,454
38,454
2,319,545
Andrew Johnson
32,686
32,686
1,971,620
Reji Puthenveetil
38,454
38,454
2,319,545
(1)
The amounts represent the aggregate grant date fair value of the restricted stock and of the PSUs computed in accordance with ASC Topic 718. For restricted stock, such amounts are determined by multiplying the number of shares awarded by the closing price of our Common Stock on January 12, 2021 ($24.24), the date of grant. For PSUs, the grant date fair value ($36.08) was determined using a Monte Carlo simulation technique under the option pricing method. Assumptions used in the calculation of these amounts are included in Note 18 – Stock-Based Compensation to our consolidated financial statements, which are included in our Annual Report on Form 10-K for the year ended December 31, 2021.
In January 2024, the Compensation Committee will certify performance under the 2021 PSUs and determine, within a range of 0-150% of target, the number of shares earned.
Employment Agreements and Other Agreements with NEOs
The Company entered into employment agreements with each of our NEOs. Each of these agreements was determined based on negotiations with the applicable NEO and taking into account his background and qualifications and the nature of his position. We believe that these compensation packages are appropriate in light of the intense competition for top executives in our industry and among similarly situated companies, and that the terms of these arrangements are consistent with our executive compensation goals, including the balancing of short-term and long-term compensation to properly motivate our NEOs.
Dr. Jeffrey A. Graves
Dr. Graves’ employment agreement provides for a minimum base annual salary of $825,000 and a target bonus opportunity equal to 100% of his base salary, with the exact amount of any such bonus to be based upon the achievement of performance goals to be determined by the Compensation Committee. The employment agreement entitles Dr. Graves to participate in all other benefits generally available to our other executive employees, including participation in the Company’s health benefit plans and equity award programs. Pursuant to Dr. Graves’ employment agreement he was granted the following outstanding equity awards:
an initial restricted stock award for shares of Common Stock with a value of $2,000,000 that vests 20%, 40%, and 40% on December 31, 2020, December 31, 2021, and December 31, 2022, respectively, subject to his continued employment, and
a long-term equity grant with a value of $2,500,00 equally divided between a time-based restricted stock award that vests in 3 equal installments on each of the first, second, and third anniversaries of the date of grant, and a PSU award, which may be earned during the three-year period ending on May 11, 2023 based on the achievement at threshold (25%), target (50%), and maximum (75%) TSR, which would earn 50%, 100%, and 150% of the PSUs, respectively, subject to his continued employment.
Our employment agreement with Dr. Graves provides for an initial two-year employment term that automatically extends for additional one-year periods unless terminated by Dr. Graves or us upon at least 30 days’ prior written notice of intention not to renew. The agreement may also be terminated by us or Dr. Graves for other reasons and, subject to the conditions set forth in the employment agreement, provides for certain payments and benefits in connection with certain termination events or a change of control as described under “Potential Benefits upon Termination or Change of Control” beginning on page 44 below.
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Jagtar Narula
Mr. Narula’s employment agreement provides for a minimum base annual salary of $400,000 and a target bonus opportunity of not less than 50% of his base salary, with the exact amount of any such bonus to be based upon the achievement of performance goals to be determined by the Compensation Committee. The employment agreement entitles Mr. Narula to participate in all other benefits generally available to our other executive employees, including participation in the Company’s health benefit plans and equity award programs. Pursuant to Mr. Narula’s employment agreement he was granted the following outstanding equity award:
an initial time-based restricted stock award for shares of Common Stock with a value of $1,800,000 that vests in two equal annual installments on the first and second anniversaries of the date of grant, subject his continued employment.
Our employment agreement with Mr. Narula provides for an initial two-year employment term that automatically extends for additional one-year periods unless terminated by Mr. Narula or us upon at least 30 days’ prior written notice of intention not to renew. The agreement may also be terminated by us or Mr. Narula for other reasons and, subject to the conditions set forth in the employment agreement, provides for certain payments and benefits in connection with certain termination events or a change of control as described under “Potential Benefits upon Termination or Change of Control” beginning on page 44 below.
Menno Ellis
Mr. Ellis’ employment agreement provides for a minimum base annual salary of $330,000. Mr. Ellis is also entitled to receive cash performance bonuses, with the exact amount of any such bonus to be based upon the achievement of performance goals to be determined by the Compensation Committee. The employment agreement entitles Mr. Ellis to participate in all other benefits generally available to our other executive employees, including participation in the Company’s health benefit plans and equity award programs. His agreement also provides that his primary work location will be his home office in Dallas, Texas.
Our employment agreement with Mr. Ellis provides for an initial two-year employment term that automatically extends for additional one-year periods unless terminated by Mr. Ellis or us upon at least 30 days’ prior written notice of intention not to renew. The agreement may also be terminated by us or Mr. Ellis for other reasons and, subject to the conditions set forth in the employment agreement, provides for certain payments and benefits in connection with certain termination events as described under “Potential Benefits upon Termination or Change of Control” beginning on page 44 below. Mr. Ellis’ employment agreement automatically extended for an additional one-year period in November 2021.
Andrew M. Johnson
Mr. Johnson’s employment agreement provides for a minimum base annual salary of $333,000. Mr. Johnson is also entitled to receive cash performance bonuses, with the exact amount of any such bonus to be based upon the achievement of performance goals to be determined by the Compensation Committee. The employment agreement entitles Mr. Johnson to participate in all other benefits generally available to our other executive employees, including participation in the Company’s health benefit plans and equity award programs.
Our employment agreement with Mr. Johnson provides for an initial two-year employment term that automatically extends for additional one-year periods unless terminated by Mr. Johnson or us upon at least 30 days’ prior written notice of intention not to renew. The agreement may also be terminated by us or Mr. Johnson for other reasons and, subject to the conditions set forth in the employment agreement, provides for certain payments and benefits in connection with certain termination events as described under “Potential Benefits upon Termination or Change of Control” beginning on page 44 below. Mr. Johnson’s employment agreement automatically extended for an additional one-year period in June 2021.
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Reji Puthenveetil
Mr. Puthenveetil’s employment agreement provides for a minimum base annual salary of $400,000 and a target bonus opportunity of not less than 50% of his base salary, with the exact amount of any such bonus to be based upon the achievement of performance goals to be determined by the Compensation Committee. The employment agreement entitles Mr. Puthenveetil to participate in all other benefits generally available to our other executive employees, including participation in the Company’s health benefit plans and equity award programs. Pursuant to Mr. Puthenveetil’s employment agreement he was granted the following outstanding equity awards:
a long-term equity grant with a value of $1,000,00 equally divided between a time-based restricted stock award, that vests in 3 equal installments on October 1 of 2021, 2022, and 2023, and a PSU award, which may be earned during the period commencing on October 1, 2020 and ending on the third anniversary based on the achievement at threshold (25%), target (50%), and maximum (75%) TSR, which would earn 50%, 100%, and 150% of the PSUs, respectively, and
a 2021 long-term equity award for shares of Common Stock with a value equal to $1,000,000, equally divided between time-based restricted stock and PSUs, issued pursuant to the performance criteria set by the Compensation Committee as part of its 2021 executive compensation program.
Vesting of the equity awards described above will continue in the ordinary course schedule if (a) Mr. Puthenveetil is terminated without cause or he terminates his employment as a result of constructive discharge (as defined in his agreement) on a date prior to March 31, 2024, or (b) if Mr. Puthenveetil voluntarily terminates his employment for any reason after October 1, 2022.
Our employment agreement with Mr. Puthenveetil provides for an initial two-year employment term that automatically extends for additional one-year periods unless terminated by Mr. Puthenveetil or us upon at least 30 days’ prior written notice of intention not to renew. The agreement may also be terminated by us or Mr. Puthenveetil for other reasons and, subject to the conditions set forth in the employment agreement, provides for certain payments and benefits in connection with certain termination events or a change of control as described under “Potential Benefits upon Termination or Change of Control” beginning on page 44 below.
Change of Control Severance Policy
On February 22, 2018, the Compensation Committee adopted the Company’s Change of Control Severance Policy (the “COC Severance Policy”). The COC Severance Policy is intended to provide eligible officers with reasonable financial security in their employment and position with the Company, without distraction from uncertainties regarding their employment created by the possibility of a potential or actual change of control. The COC Severance Policy applies to our CEO and all Executive Vice Presidents and Senior Vice Presidents, which includes all of our NEOs. For a more detailed discussion of the benefits payable to our NEOs under the COC Severance Policy, see “Potential Benefits upon Termination or Change of Control” beginning on page 44 below.
Other Compensation Matters
Benefits and Perquisites
We provide our employees, including the NEOs, with a benefit program that we believe is reasonable, competitive and consistent with the objectives of our compensation program. As a matter of policy, the Compensation Committee does not award personal benefits or perquisites to our NEOs that are unrelated to our business. However, under certain circumstances discussed below, the Compensation Committee has approved certain personal benefits or perquisites that are either provided to a NEO by contract or that it deemed to be in our interests in order to induce executives to commence or maintain employment with us. Those amounts are reported in the Summary Compensation Table.
Our executives, including the NEOs, are eligible to participate in employee benefit programs that we provide to our employees generally, which include a group insurance program providing group health, dental, vision, life and long-term disability insurance. Other benefits include a Section 401(k) plan, health savings accounts, flexible spending accounts for health and dependent care expenses, sick leave, holiday time and vacation time.
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In general, the Compensation Committee strives to mitigate the use of non-performance-based forms of compensation without jeopardizing the Company’s ability to offer a comprehensive compensation program that will attract and retain executives in a competitive market.
Accounting and Tax Considerations
The Compensation Committee generally considers the financial accounting implications of stock awards and other compensation to the Company’s executive officers in evaluating and establishing the Company’s compensation policies and practices. The Compensation Committee believes that in establishing incentive compensation programs for our NEOs, the potential deductibility of the compensation payable should be one of several factors taken into consideration. Therefore, while the Compensation Committee considers tax deductibility in making executive compensation program decisions, the Compensation Committee’s primary consideration is whether the executive compensation programs align the interests of our executives with those of our stockholders.
Stock Performance
While we generally consider matters such as stock performance and TSR in making compensation decisions, we do not consider them as controlling factors in making compensation decisions.
Our priorities and the priorities of our management are centered on achieving our strategic objectives, meeting customer needs, new product development, increasing cash generation, identifying, completing and successfully integrating strategic investments, and promoting operational excellence and innovation. The pursuit of such longer range objectives is not necessarily consistent with producing short-term results to increase our stock price or stockholder return, but we believe that pursuing these longer-range objectives should result in performance that is more likely to maximize total return to our stockholders over time.
Since our executive compensation is based upon factors relating to our growth and profitability, as well as TSR, and the performance of our business as well as the contributions of each of our executives to achieving our objectives, we believe that we have provided appropriate incentives to align management’s interests with our long-term growth and development and the interests of our stockholders. We also believe that there are many ways in which our executives contribute to building a successful company. While our financial statements and stock price reflect the results of some of those efforts, many long-term strategic decisions made in pursuing our growth and development may have little visible impact on our stock price in the short-term.
Executive Stock Ownership Guidelines
Our executive officers and certain other senior management are required to maintain a minimum equity stake in the Company. This policy reflects the Board’s belief that our most senior executives should maintain a significant personal financial stake in 3D Systems to promote long-term stockholder value. In addition, the policy helps align executive and stockholder interests, which reduces the incentive for excessive short-term risk taking. Each of our NEOs and certain other senior officers are required to acquire and maintain ownership of shares of our Common Stock equal to a specified multiple of his or her base salary, which ranges from one to six times base salary, as shown in the table below. Each officer subject to a share ownership requirement must retain 50% of all net shares (post-tax) that vest until achieving his or her minimum share ownership requirement.
Title
Minimum Stock Ownership Requirement
Chief Executive Officer
6x annual base salary
Chief Financial Officer
3x annual base salary
Other Executive Officers (EVPs)
2x annual base salary
Other Senior Officers (SVPs)
1x annual base salary
Policy on Hedging Transactions
Our Policy Statement Governing Insider Trading (the “Insider Trading Policy”) prohibits any directors, officers, employees, or consultants of the Company or any of its subsidiaries or affiliates from engaging in short-term or speculative transactions in our securities. This policy includes within its coverage short sales, which for directors and executive officers of the Company are prohibited by Section 16 of the Exchange Act. It also prohibits transactions in publicly traded options, such as puts, calls, and other derivative securities, or purchase financial investments (including prepaid variable forward contracts, equity sweeps, collars, and exchange funds),
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or the engagement in transactions that hedge or offset, or are designed to hedge or offset, any decrease in the market value of our Common Stock. The Insider Trading Policy requires that our directors and executive officers pre-clear any transactions in our securities with our Chief Legal Officer or Assistant General Counsel.
Clawbacks of Incentive Compensation
As part of our Corporate Governance Guidelines, the Board has adopted a policy on the clawback of incentive compensation. Under the terms of this policy, following a restatement of the Company’s financial results the Board or an appropriate Board committee must conduct a reasonable investigation into whether the restatement was caused by any fraud, illegal act, or misconduct by one or more of our executive officers. If the Board or an appropriate Board committee has determined that any fraud, illegal act, or intentional misconduct by one or more executive officers caused, directly or indirectly, the Company to restate its financial statements, subject to applicable law, the Board will take, exercising its business judgment, such action as it deems necessary to remedy the misconduct and prevent its recurrence. The Board, subject to applicable law, may require reimbursement of any bonus or cash or equity incentive compensation awarded to such officers and/or effect the cancellation of unvested restricted stock or outstanding stock option awards previously granted to such officers in the amount by which such compensation exceeded any lower payment that would have been made based on the restated financial results. The Company will report publicly any decision by the Board to recover any particular award of bonus or incentive compensation or cancel unvested restricted stock or outstanding stock option awards (and associated stock appreciation rights) pursuant to this policy.
In addition, each award granted under the 2015 Incentive Plan is subject to the condition that we may require that such award be returned and that any payment made with respect to such award must be repaid if such action is required under the terms of any recoupment or “clawback” policy of ours as in effect on the date that the payment was made or on the date the award was granted or exercised or vested or earned, as applicable.
Compensation Committee Report
The Compensation Committee has reviewed and discussed with management the section titled “Compensation Discussion and Analysis.” Based on such review and discussion, the Compensation Committee has recommended to the Board of Directors that such section be included in this Proxy Statement.
Compensation Committee:
Kevin S. Moore, Chair
William E. Curran
William D. Humes
Jim D. Kever
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Summary Compensation Table
The following table presents information regarding the compensation of each of the NEOs for services rendered during 2021, 2020 and 2019.
Name and Principal
Position(1)
Year
Salary(2)
($)
Bonus
($)
Stock
Awards(3)
($)
Non-Equity
Incentive Plan
Compensation(4)
($)
All Other
Compensation(5)
($)
Total
($)
Jeffrey Graves
President and Chief Executive Officer
2021
837,400
6,378,719
1,274,697
83,434
8,574,250
2020
488,654
5,332,933
95,773
5,917,360
Jagtar Narula
Executive Vice President and Chief Financial Officer
2021
406,000
2,319,545
370,792
5,594
3,101,931
2020
115,385
1,859,532
1,974,917
Menno Ellis
Executive Vice President - Healthcare Solutions
2021
406,000
2,319,545
370,792
8,400
3,104,737
2020
376,562
742,144
98,000
8,400
1,225,105
Andrew Johnson
Executive Vice President, Chief Legal Officer and Secretary
2021
379,650
2,251,252
346,761
8,400
2,986,063
2020
360,446
733,307
91,630
8,400
1,193,783
2019
346,000
792,543
30,820
75,401
1,244,764
Reji Puthenveetil
Executive Vice President - Industrial Solutions
2021
406,000
2,319,545
370,792
38,687
3,135,024
2020
167,308
1,148,862
16,428
1,332,598
(1)
This column includes the name and principal position of each NEO during the year ended December 31, 2021.
(2)
The amounts in the salary column represent the salary paid to each NEO with respect to each year during which he was a NEO.
(3)
The amounts reported in this column for 2021 represent the aggregate grant date fair value computed in accordance with ASC Topic 718 of restricted stock awards and PSU awards. The value of restricted stock awards was determined by multiplying the number of shares awarded by the closing price of our Common Stock on the date of grant. The value of the PSU awards, which have a market-based performance metric and three-year performance period, was determined using a Monte Carlo simulation technique under the option pricing method. For these PSUs, achievement of the highest level of performance conditions would result in the NEOs receiving 150% of the target amounts These amounts are as follows: Dr. Graves, $5,732,082; Mr. Narula, $2,081,130; Mr. Ellis, $2,081,130; Mr. Johnson, $1,768,966; and Mr. Puthenveetil, $2,081,130. See “2021 Long-Term Incentive Awards” above. Assumptions used in the calculation of these amounts are included in “Note 18 – Stock-Based Compensation” to our consolidated financial statements, which are included in our Annual Report on Form 10-K for the year ended December 31, 2021.
(4)
The amounts represent annual bonuses awarded to each NEO under the 2021 Annual Bonus Program were settled in immediately vested shares of Common Stock as follows: Dr. Graves, 80,626 shares; Mr. Narula, 23,453 shares; Mr. Ellis, 23,453 shares; Mr. Johnson, 21,933 shares; and Mr. Puthenveetil, 23,453 shares.
(5)
The amounts represent matching contributions made by the Company in accordance with the terms of the Company’s 401(k) Plan for all NEOs. Additional amounts included in the “All other Compensation” column for 2021 include: (a) for Mr. Graves, payment of $75,034 in relocation benefit payment, and (b) for Mr. Puthenveetil, $36,103 in commuting benefit payments, which includes $15,240 in rent reimbursement for temporary housing in Rock Hill, SC, $8,428 in mileage expense, and $12,435 as a tax gross-up on these amounts.
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Grants of Plan-Based Awards in 2021
The following table sets forth information with respect to plan-based awards granted in 2021. The threshold, target, and maximum amounts represent the incentive awards for the 2021 Annual Bonus Program and the PSUs that could be awarded assuming achievement of the pre-determined performance metric over the three-year performance period (such achievement to be certified by the Compensation Committee subsequent to the completion of the performance period). Annual bonus award payouts earned by the NEOs with respect to 2021 Annual Bonus Program were equal to 150% of target and settled in shares of immediately vested Common Stock in lieu of cash. See “2021 Annual Bonus Program” above.
 
 
 
Estimated Future Payouts Under Non-
Equity Incentive Plan Awards
Estimated Future Payments Under
Equity Incentive Plan Awards(1)
All Other
Stock
Awards:
Number
of Shares
or Units
(#)
Grant Date
Fair Value
of Stock and
Option
Awards(2)
($)
 
 
Grant
Date
Threshold
($)
Target
($)
Maximum
($)
Threshold
(#)
Target
(#)
Maximum
(#)
Jeffrey Graves
2021 Bonus Program
 
424,900
849,800
1,274,700(3)
 
 
 
 
 
2021 LTI PSUs
1/12/2021
52,874
105,748
158,622
3,815,388
2021 LTI RSAs
1/12/2021
 
 
 
 
 
 
105,748
2,563,332
Jagtar Narula
2021 Bonus Program
 
123,600
247,200
370,800(3)
 
 
 
 
 
2021 LTI PSUs
1/12/2021
19,227
38,454
57,681
1,387,420
2021 LTI RSAs
1/12/2021
38,454
932,125
Menno Ellis
2021 Bonus Program
 
123,600
247,200
370,800(3)
 
 
 
 
 
2021 LTI PSUs
1/12/2021
19,227
38,454
57,681
38,454
1,387,420
2021 LTI RSAs
1/12/2021
932,125
Andrew Johnson
2021 Bonus Program
115,590
231,180
346,700(3)
2021 LTI PSUs
1/12/2021
16,343
32,686
49,029
1,179,311
2021 LTI RSAs
1/12/2021
32,686
792,309
2021 Recognition Award
1/12/2021
11,536
279,633
Reji Puthenveetil
2021 Bonus Program
123,600
247,200
370,800(3)
2021 LTI PSUs
1/12/2021
 
 
 
19,227
38,454
57,681
 
1,387,420
2021 LTI RSAs
1/12/2021
38,454
932,125
(1)
The amounts in these columns represent performance share units that vest in full on or about January 12, 2024, based on achievement of TSR over a 3-year performance period.
(2)
The amounts included in the “Grant Date Fair Value of Stock and Option Awards” column represent the aggregate grant date fair value computed in accordance with ASC Topic 718. Assumptions used in the calculation of these amounts are included in Note 18 – Stock-Based Compensation to our consolidated financial statements, which are included in our Annual Report on Form 10-K for the year ended December 31, 2021.
(3)
The amounts payable under the 2021 Annual Bonus Program were paid in grants of immediately vested Common Stock at the fair market value on the date of grant.
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Outstanding Equity Awards at Year-End 2021
The following table presents information with respect to equity awards made to each of NEOs that were outstanding on December 31, 2021.
 
 
Option Awards
Stock Awards
Name
Grant
Date
Number of
Securities
Underlying
Unexercised
Options
Exercisable
(#)
Equity
Incentive
Plan
Awards:
Number of
Securities
Underlying
Unexercised
Unearned
Options(1)
(#)
Option
Exercise
Price
($)
Option
Expiration
Date
Number
of
Shares
or Units
of Stock
That
Have
Not
Vested
(#)
Market
Value of
Shares or
Units of
Stock That
Have Not
Vested(2)
($)
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)
($)
Jeffrey Graves
5/26/2020
108,843(3)
2,344,478
5/26/2020
113,378(4)
2,442,162
5/26/2020
170,068(10)
3.663.265
1/12/2021
105,748(4)
2,277,812
1/12/2021
105,748(10)
2,277,812
Jagtar Narula
9/14/2020
144,694(5)
3.116.709
1/12/2021
38,454(10)
828,299
1/12/2021
38,454(10)
828,299
Menno Ellis
12/1/2016
100,000
13.28
12/1/2026
12/1/2016
20,000(11)
430,800
 
2/15/2019
6,091(7)
131,200
12/13/2019
4,164(7)
89,693
 
2/18/2020
18,333(4)
394,893
7/17/2020
7,288(4)
156,984
 
1/12/2021
38,454(6)
828,299
1/12/2021
38,454(10)
828,299
Andrew Johnson
7/26/2016
160,000
13.25
7/26/2026
7/26/2016
40,000(11)
861,600
2/15/2019
7,919(7)
170,575
12/13/2019
4,036(7)
86,935
2/18/2020
20,151(4)
434,053
1/12/2021
32,686(6)
704,056
1/12/2021
11,536(8)
248,485
1/12/2021
32,686(10)
704,056
Reji Puthenveetil
10/5/2020
61,808(9)
1,331,344
10/5/2020
92,712(10)
1,997,016
1/12/2021
38,454(6)
828,299
1/12/2021
38,454(10)
828,299
(1)
Option awards in this column vest upon the satisfaction of certain share price performance conditions.
(2)
Value calculated based on the $21.54 closing price of our stock on December 31, 2021.
(3)
The outstanding balance of this award vests in full on December 31, 2022.
(4)
The outstanding balance of this award vests in equal installments on the second and third anniversaries of the grant date.
(5)
The outstanding balance of this award vests in full on the second anniversary of the grant date.
(6)
Award vests in equal installments over a three-year period on the first, second and third anniversaries of the grant date.
(7)
The outstanding balance of this award vests on the third anniversary of the grant date.
(8)
Award vests in full on January 12, 2022.
(9)
Outstanding balance of award vests in equal installments on October 1, 2022, and October 1, 2023.
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(10)
Amount represents the number of PSU awards based on achievement of target performance over a three-year performance period.
(11)
Restricted stock awards that vest upon the satisfaction of certain share price and financial performance conditions.
Option Exercises and Stock Vested in 2021
No options were exercised by our NEOs in 2021. Shares of restricted Common Stock and RSUs held by the NEOs vested as follows during 2021:
 
Number of
Shares Acquired
on Vesting
(#)
Value Realized
on Vesting(1)
($)
Jeffrey Graves
175,922
4,413,700
Jagtar Narula
146,225
4,383,019
Menno Ellis
25,419
1,004,557
Andrew Johnson
25,754
1,091,564
Reji Puthenveetil
32,196
905,385
(1)
Amounts reflect the aggregate market value of our Common Stock based on the closing price of our Common Stock on the applicable vesting date.
Potential Benefits upon Termination or Change of Control
Graves Employment Agreement
Under his employment agreement, Dr. Graves would, upon termination by the Company without “cause” or resignation for “constructive discharge” (in each case as defined in his agreement), become entitled to receive the following:
An amount equal to 150% of his base salary, payable in 18 equal monthly installments;
Any accrued but unpaid base salary as of the termination date;
Any accrued but unused vacation time;
Any accrued but unpaid performance bonus as of the termination date, on the same terms and at the same times as would have applied had the NEO’s employment not terminated;
Acceleration of any unvested shares remaining under his new hire time-based equity award; and
If the NEO elects COBRA coverage for health and/or dental insurance, Company-paid monthly premium payments for such coverage such that the NEO’s contributions to such plans will remain the same as if the NEO were employed by the Company until the earliest of: (1) 18 months from the termination date or (2) the date the NEO is no longer eligible for COBRA coverage.
In the event of termination by the Company without “cause” or resignation for “constructive discharge” within 180 days before or two years after a “change of control” (as defined in his employment agreement), Dr. Graves is entitled to receive a lump sum cash payment equal to: (i) two times the sum of his base salary and target annual bonus, (ii) a pro rata portion of his target annual bonus for the fiscal year in which the termination occurs, (iii) accelerated vesting of the unvested shares under all outstanding time-based equity award and conversion of outstanding PSUs into immediately accelerated RSAs, and (vi) the difference between the monthly COBRA rate and the active employee premium rate for the applicable group health coverage (i.e., medical, dental and vision) for 24 months.
Narula, Ellis, Johnson and Puthenveetil Employment Agreements
Under their employment agreements, Messrs. Narula, Ellis, Johnson and Puthenveetil would, upon termination by the Company without “cause” or resignation for “constructive discharge” (in each case as defined in their respective agreements), become entitled to receive the following:
An amount equal to the NEO’s base salary, payable in 12 equal monthly installments;
Any accrued but unpaid base salary as of the termination date;
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Any accrued but unpaid performance bonus as of the termination date, on the same terms and at the same times as would have applied had the NEO’s employment not terminated; and
If the NEO elects COBRA coverage for health and/or dental insurance, Company-paid monthly premium payments for such coverage such that the NEO’s contributions to such plans will remain the same as if the NEO were employed by the Company until the earliest of: (1) 12 months from the termination date; or (2) the date the NEO is no longer eligible for COBRA coverage.
Vesting of the equity awards granted to Mr. Puthenveetil in 2020 would continue in the ordinary course schedule if he was terminated without cause or he terminated his employment as a result of constructive discharge (as defined in his agreement) on December 31, 2020.
See “Change of Control Severance Policy” below for a description of payments to be received by these NEOs upon a termination in connection with a change of control.
Change of Control Severance Policy
On February 22, 2018, the Compensation Committee adopted the Company’s the COC Severance Policy. The COC Severance Policy is intended to provide eligible officers with reasonable financial security in their employment and position with the Company, without distraction from uncertainties regarding their employment created by the possibility of a potential or actual change of control. The COC Severance Policy applies to our CEO and all Executive Vice Presidents and Senior Vice Presidents (each, a “Participant”), which includes all of our NEOs.
A Participant is entitled to benefits under the COC Severance Policy in the event of a termination of the Participant’s employment by the Company without “Cause” or by the Participant for “Constructive Discharge” either (a) on or before the second anniversary of the date of a “Change of Control” (as such terms are defined in the COC Severance Policy) or (b) in certain circumstances, within six months prior to the date that the Change of Control occurs (a “Qualifying Termination”). The COC Severance policy does not change the terms of any plans or arrangements that may provide for severance benefits in case of a termination of employment not in connection with a Change of Control. The COC Severance Plan also includes provisions intended to avoid duplication of benefits with the severance benefits that otherwise may be payable under any other plan or arrangement upon a Qualifying Termination.
In the event of a Qualifying Termination, a Participant will receive a lump sum cash payment equal to: (i) a multiple (which is 2.0 for our CEO and 1.5 for all other Participants) times the sum of the Participant’s base salary and target annual bonus, (ii) a pro rata portion of the Participant’s target annual bonus for the fiscal year in which the termination occurs, and (iii) the difference between the monthly COBRA rate and the active employee premium rate for the applicable group health coverage (i.e., medical, dental and vision) as elected by the Participant (for the Participant and his or her eligible dependents) at the time of the Qualifying Termination multiplied by a number of months equal to 24 for our CEO and 18 for each other Participant. A Participant’s right to receive this payment and benefits is subject to his or her execution of a general release of claims against the Company.
In addition, the COC Severance Policy provides that all outstanding performance-based equity awards granted after the effective date of the COC Severance Policy shall be converted in their entirety to timed-based equity awards upon the occurrence of a Change of Control based on the assumption that the performance goals are achieved at target. The vesting of performance-based equity awards that are converted to time-based equity awards shall occur upon the same vesting schedule upon which the former performance metrics would have been measured and shall vest in full upon a Qualifying Termination. Additionally, if a Participant incurs a Qualifying Termination, all outstanding time-based awards equity awards, including converted performance-based equity awards that are held by a Participant and were granted after the effective date of the COC Severance Policy shall become fully vested and all forfeiture restrictions shall lapse.
The following table reflects the amount of compensation that would be paid to each of our NEOs in the event of a termination of the executive officer’s employment under various scenarios. The amounts shown assume that such termination was effective as of December 31, 2021, and include estimates of the amounts that would be paid to each executive officer upon such NEO’s termination. The table only includes additional benefits
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that result from the termination and does not include any amounts or benefits earned, vested, accrued or owing under any plan for any other reason. None of our NEOs is entitled to any additional benefits in connection with a Change of Control without a related termination of employment.
Name(1)
Without Cause or
Good Reason (not
in Connection with
a Change in
Control)(2)
Death or
Disability(3)
Termination in
Connection with
a Change in
Control)(4)
Jeffrey A. Graves
$4,918,158
$3,619,175
$12,848,858
Jagtar Narula
$3,903,739
$370,792
$5,240,158
Menno Ellis
$787,031
$370,972
$2,896,218
Andrew M. Johnson
$736,999
$346,761
$2,856,724
Reji Puthenveetil
$783,681
$370,792
$4,907,202
(1)
None of the NEOs will receive any special benefits in the event of voluntary separation without good reason or termination for cause. Under standard plan provisions, the NEOs will continue to be eligible for benefits under the Company’s medical and dental plans until the last day of the month in which termination occurs. Any bonus earned in the year of termination is forfeited.
(2)
Amounts in this column represent the cash and benefits to be paid to the NEO in the event of termination by the Company without cause or resignation with good reason (each as defined in the NEO’s employment agreement). For Dr. Graves the severance benefits represent (i) 18 months of base salary, (ii) payment of the bonus earned under the 2021 Annual Bonus Program, (iii) accelerated vesting of the unvested shares under his new hire RSA award (101,843 shares), and (iv) COBRA reimbursement for 18 months.
For Mr. Narula, severance benefits represent: (i) 12 months of base salary, (ii) payment of the bonus earned under the Annual Bonus Program, (iii) accelerated vesting of the unvested shares under his new hire RSA award (144,694 shares), and (iv) COBRA reimbursement for 12 months.
For Messrs. Ellis and Johnson, severance benefits represent: (i) 12 months of base salary, (ii) payment of the bonus earned under the 2021 Annual Bonus Program, and (iii) COBRA reimbursement for 12 months.
For Mr. Puthenveetil, severance benefits represent: (i) 12 months of base salary, (ii) payment of the bonus earned under the 2021 Annual Bonus Program, (iii) continued vesting of all outstanding equity awards (61,808 RSAs which vest in equal installments on October 1, 2022 and 2023, and 139,068 PSUs at maximum earnout that vest on October 1, 2023), and (iv) COBRA reimbursement for 12 months.
In each case, the value of accelerated equity amounts was computed based on the closing price of our Common Stock on December 31, 2021, of $21.54.
(3)
Amounts in this column represent the bonus for the year of termination that each NEO would have received in the event of termination by death or disability. Benefits for Dr. Graves also includes accelerated vesting of the unvested shares under his new hire RSA award (108,843 shares), as provided for under his employment agreement in the event of termination for death or disability. The value of the accelerated equity amount was computed based on the closing price of our Common Stock on December 31, 2021, of $21.54.
(4)
The amounts in this row are payable in the event of termination by the Company without cause or resignation for “constructive discharge” within six months prior to or two years after a “change of control.” Certain amounts are duplicative of amounts payable in the event of termination by the Company without cause or resignation for “constructive discharge” not in connection with a change of control. For Dr. Graves the severance benefits represent (i) two times the sum of (x) the NEO’s then-current base salary and (y) the NEO’s target cash incentive bonus amount, (ii) payment of the bonus earned under the Annual Bonus Program, (iii) accelerated vesting of the unvested shares under outstanding time-based RSA awards (327,969 shares), (iv) the conversion of outstanding PSUs into immediately-accelerated RSAs (payout assumed at target share amount of 275,618 shares), and (v) COBRA reimbursement for 24 months.
For Mr. Narula, severance benefits represent: (i) two times the sum of (x) the NEO’s then-current base salary and (y) the NEO’s target cash incentive bonus amount, (ii) payment of the bonus earned under the 2021 Annual Bonus Program, (iii) accelerated vesting of the unvested shares under outstanding time-based RSA awards (183,148 shares), (iv) the conversion of outstanding PSUs into immediately-accelerated RSAs (payout assumed at target share amount of 38,454), and (v) COBRA reimbursement for 18 months.
For Messrs. Ellis and Johnson, severance benefits represent: (i) two times the sum of (x) the NEO’s then-current base salary and (y) the NEO’s target cash incentive bonus amount, (ii) payment of the bonus earned under the 2021 Annual Bonus Program, (iii) accelerated vesting of the unvested shares under outstanding time-based RSA awards (74,330 and 76,828 shares, respectively), (iv) the conversion of outstanding PSUs into immediately-accelerated RSAs (payout assumed at target share amount of 38,454 and 32,686 shares, respectively), and (v) COBRA reimbursement for 18 months.
For Mr. Puthenveetil, severance benefits represent: (i) two times the sum of (x) the NEO’s then-current base salary and (y) the NEO’s target cash incentive bonus amount, (ii) payment of the bonus earned under the 2021 Annual Bonus Program, (iii) accelerated vesting of all outstanding time-based RSA awards (100,626 shares), (iv) the conversion of outstanding PSUs into immediately-accelerated RSAs (payout assumed at target share amount of 131,166 shares), and (v) COBRA reimbursement for 18 months.
In each case, the value of accelerated equity amounts was computed based on the closing price of our Common Stock on December 31, 2021, of $21.54.
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CEO Pay Ratio
As required by applicable SEC rules, we must annually disclose the annual total compensation of our median employee (excluding the CEO), the annual total compensation of our CEO, and the ratio of the CEO compensation to the median employee compensation.
For calendar 2021, our last completed fiscal year:
the annual total compensation of our CEO, calculated as described below from information reported in the Summary Compensation Table included elsewhere in this Proxy Statement, was $8,574,251; and
the annual total compensation of our median employee (excluding our CEO) was $65,638.
Based on this information, for 2021, the ratio of the annual total compensation of our CEO to the annual total compensation of our median employee was 130 to 1.
We took the following steps to identify our median employee and determine the annual total compensation of that employee and our CEO:
We determined that, as of December 31, 2021, our active, global employee population consisted of approximately 1,879 individuals (excluding the CEO). This population consisted of our full-time, part-time and temporary employees employed with us as of that date.
To identify the median employee from our employee population, we used annual base salary as of December 31, 2021.
For the annual total compensation of our median employee, we identified and calculated the elements of that employee’s compensation for 2021 in accordance with the requirements of Item 402(c)(2)(x), which are the same requirements we used to determine the annual total compensation of our CEO.
The CEO pay ratio reported above is a reasonable estimate calculated in a manner consistent with SEC rules based on the methodologies and assumptions described above. SEC rules for identifying the median employee and determining the CEO pay ratio permit companies to employ a wide range of methodologies, estimates and assumptions. As a result, the CEO pay ratios reported by other companies, which may have employed other permitted methodologies or assumptions and which may have a significantly different work force structure from ours, are likely not comparable to our CEO pay ratio.
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DELINQUENT SECTION 16(A) REPORTS
Section 16(a) of the Exchange Act requires our executive officers and directors and any person owning 10 percent or more of the outstanding shares of our Common Stock to file reports with the SEC to report their beneficial ownership of and transactions in our securities and to furnish us with copies of those reports. Based upon a review of those reports submitted to us, no executive officer, director, or 10 percent beneficial owner failed to file, on a timely basis, the reports required by Section 16(a) of the Exchange Act for the year ended December 31, 2021, except that Jeffrey Blank, our former Executive Vice President – Engineering and Product Development, filed a late filing to report his holdings upon promotion to such position on January 1, 2021, and Anthony Grabenau, our former principal accounting officer, filed a late filing to report an annual equity award received on February 15, 2021, and a recognition equity award on March 1, 2021.
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SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth (a) as of the date indicated in the applicable Schedule 13D or 13G with respect to each person identified as having filed a Schedule 13D or 13G and (b) as of March 28, 2022, with respect to the other persons listed in the table, the number of outstanding shares of Common Stock beneficially owned:
by each person known to us to be the beneficial owner of more than five percent of our Common Stock;
by each current director and nominee for director and each of our NEOs; and
by all of our directors and executive officers as a group.
Except as otherwise indicated in the footnotes to the table, and subject to any applicable community property laws, each person has the sole voting and investment power with respect to the shares beneficially owned. The address of each person listed is in care of 3D Systems Corporation, 333 Three D Systems Circle, Rock Hill, South Carolina 29730, unless otherwise noted.
 
Shares of Common Stock
Beneficially Owned(1)
Name and Address of Beneficial Owner
Number of
Shares
Percentage
Ownership
BlackRock, Inc.
55 East 52nd Street
New York, New York 10055
19,851,119(2)
15.23%
The Vanguard Group
100 Vanguard Blvd.
Malvern, PA 19355
13,457,857(3)
10.32%
Jeffrey A. Graves
567,017(4)
*
Jagtar Narula
262,054(45)
*
Menno Ellis
163,924(6)
*
Andrew M. Johnson
192,988(7)
*
Reji Puthenveetil
182,472(8)
*
Malissia Clinton
44,367
*
William E. Curran
109,394
*
Claudia N. Drayton
3,376
*
Thomas W. Erickson
124,185
*
Charles W. Hull
525,946(9)
*
William D. Humes
68,573
*
Jim D. Kever
379,657(10)
*
Charles G. McClure, Jr.
56,855
*
Kevin S. Moore
1,565,048(11)
1.20%
Vasant Padmanabhan
21,922
*
John J. Tracy
55,449
*
Jeffrey Wadsworth
56,855
*
All directors and current executive officers as a group (20 persons)
4,503,268(12)
3.45%
*
Less than one percent
(1)
Percentage ownership is based on the number of shares of Common Stock outstanding and entitled to vote as of March 28, 2022, the record date for the Annual Meeting. Common Stock numbers include, with respect to the stockholder in question, Common Stock which the stockholder could acquire within 60 days of the record date.
(2)
BlackRock, Inc. filed a Schedule 13G on February 7, 2022, indicating that it has sole voting power over 19,851,119 of these shares and sole dispositive power over 19,673,689 of these shares.
(3)
The Vanguard Group filed a Schedule 13G on February 9, 2022, indicating that it has shared voting power over 223,890 of these shares, sole dispositive power over 13,123,196 of these shares, and shared dispositive power over 333,881 of these shares.
(4)
Consists of (a) 159,425 shares of Common Stock that Dr. Graves holds directly, and (b) 407,592 shares of restricted stock subject to time-based vesting conditions, including 56,690 shares of restricted stock vesting within 60 days of March 28, 2022. Excludes 275,816 PSUs, which may be earned upon the achievement of certain TSR over the applicable three-year performance period.
(5)
Consists of (a) 50,914 shares of Common Stock that Mr. Narula holds directly, and (b) 211,140 shares of restricted stock subject to time-based vesting conditions. Excludes 38,454 PSUs, which may be earned upon the achievement of certain TSR over a three-year performance period.
49