SEC Form DEF 14A filed by Waters Corporation

April 9, 2025

Dear Shareholders,

Waters is entering a new era of growth. Since beginning our transformation journey in 2020, our dedicated executive team has successfully regained commercial momentum, revitalized our portfolio, and expanded into rapidly growing adjacent markets. We finished 2024 in a position of strength with greater scale in our adjacencies and resilience across our business.

Over the past year, the Board maintained its prioritization of strong corporate governance practices and active director refreshment to ensure we are equipped with the set of skills and expertise needed to effectively oversee Waters’ ambitious strategy. Our highly qualified Board is composed of 10 directors, all of whom contribute skills critical to overseeing Waters’ strategy, including expertise in global markets, science and technology, manufacturing, strategic planning, and mergers and acquisitions. Further to this goal, in August 2024, we welcomed Heather Knight as our newest independent director. She brings extensive expertise in the pharmaceutical and medical device industries, along with innovation-focused strategic insights that enhance discussions on strategies to accelerate Waters’ operational and financial performance.

As we look to 2025, the Board remains confident in the deep bench of talent on our executive team and their ability to carry forward our leadership position in downstream, high-volume life sciences applications. The Board and management team will continue to prioritize effective oversight of our most critical asset: our people. One of Waters’ greatest strengths is the tremendous dedication of our 7,600 global employees, who closely collaborate with our customers to solve their greatest scientific challenges.

The Board is proud to have been named the 2024 “Public Company Board of the Year” by the National Association of Corporate Directors (NACD) New England Chapter.

On behalf of the full Board, thank you for your investment and engagement with Waters. We value the perspectives and feedback of all of our shareholders as we pursue our goal of creating sustainable shareholder growth. We respectfully ask for your support on the matters presented for vote in this proxy statement.

Sincerely,

Dr. Flemming Ornskov, M.D., M.P.H. Chair of the Board of Waters Corporation

April 9, 2025

Dear Shareholders,

Throughout 2024, Waters has remained focused on operational excellence, capitalizing on the success of our new product launches and deepening our relationships with customers globally. Thank you for your continued support. I would also like to extend my sincere appreciation to our team for their commitment, which has been fundamental in achieving this year’s great progress.

In the second half of 2024, we returned to growth across all our end-markets, successfully navigating significant market headwinds we had experienced earlier in the year. Although revenues were flat for 2024, we achieved year-over-year GAAP and adjusted operating income margin expansion, closing the year at 27.9% as reported and 31.0% on an adjusted basis, even after absorbing significant foreign exchange impacts. 2024 also marks the fourth consecutive year in which we have delivered top-tier total shareholder returns, putting us again at the top of the Life Science tools peer group.

At Waters, we continue to be driven by our purpose to accelerate the benefits of pioneering science. We collaborate with our customers to address complex challenges – such as bringing life-saving therapies to market, detecting diseases early, keeping the food and water we consume pure, and ensuring batteries are safe to use. I am incredibly proud of what we are building together.

Over the past four years, we have successfully executed a transformation that has enabled us to regain our commercial momentum, revitalize our innovation, and enter fast-growing adjacencies. In 2024, we made significant strides in each area. As we regained our commercial momentum our strategic initiatives enabled us to:

We revitalized our portfolio through several innovative product launches that play a unique role in solving customers’ unmet needs and focus on reducing human error, simplifying workflows, and improving product sustainability. A few highlights include Alliance iS Bio HPLC System, for smarter, more capable liquid chromatography separation; Xevo^TM MRT Mass Spectrometer, with its market-leading sensitivity and sustainable design; and our newer column launches, which are aimed at separating larger, more complex molecules like biologics and novel modalities

Finally, we continued to allocate resources to enter faster-growing adjacencies. We invested in areas such as bioseparations, bioanalytical characterization, took LC-MS into specialty diagnostics, and introduced our thermal and mechanical analysis portfolio to battery testing.

We are now entering a new phase of growth in 2025, building on our transformation, as we:

We are well positioned to capitalize on the emerging opportunities ahead to drive sustained, long-term growth while continuing to collaborate with our customers to accelerate the benefits of pioneering science.

Thank you for your trust and continued investment in Waters.

Unless otherwise noted, all figures discussed are as of or for the year ended December 31, 2024. Certain measures, such as adjusted operating income margin percentages, are presented on a Non-GAAP basis; the GAAP to Non-GAAP reconciliations for these measures are available on the Investor Relations pages of the Company’s website.

WATERS CORPORATION

NOTICE OF ANNUAL MEETING OF SHAREHOLDERS

We are making the Proxy Statement and the form of Proxy first available on or about April 9, 2025.

Milford, Massachusetts

April 9, 2025

TABLE OF CONTENTS

Certain of the statements in this Proxy Statement may contain “forward-looking” statements regarding future results and events. For this purpose, any statements that are not statements of historical fact may be deemed forward-looking statements. Without limiting the foregoing, the words “feels”, “believes”, “anticipates”, “plans”, “expects”, “intends”, “suggests”, “appears”, “estimates”, “projects” and similar expressions, whether in the negative or affirmative, are intended to identify forward-looking statements. The Company’s actual future results may differ significantly from the results discussed in the forward-looking statements within this Proxy Statement for a variety of reasons, including and without limitation, the factors discussed in the sections entitled “Forward-Looking Statements” and “Risk Factors” of the Company’s Annual Report on Form 10-K for the year ended December 31, 2024 (the “Annual Report”), as updated by the Company’s future filings with the Securities and Exchange Commission (the “SEC”). The forward-looking statements included in this Proxy Statement represent the Company’s estimates or views as of the date of this Proxy Statement and should not be relied upon as representing the Company’s estimates or views as of any date subsequent to the date of this Proxy Statement. Except as required by law, the Company does not assume any obligation to update any forward-looking statements.

Links to websites included in this Proxy Statement are provided solely for the information and convenience of investors. Content on the websites named, hyperlinked, or otherwise referenced herein, including the content of any reports that are noted in this Proxy Statement as being posted on our website, is not, and shall not be deemed to be, incorporated by reference into this Proxy Statement or into any of our other filings with the SEC.

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LEAVING THE WORLD BETTER THAN WE FOUND IT

Since the founding of Waters in 1958, we have remained steadfast in our commitment to leaving the world better than we found it. Waters plays a key role in ensuring the purity and efficacy of medicines, the safety of our food and water, and the durability and sustainability of the materials we use every day. We are proud of the progress we made to care for our people, communities, and the planet. For more information, please see our 2024 Environmental, Social, and Governance Report, which can be found on our website at ir.waters.com/esg.

PROPOSAL 1 — ELECTION OF DIRECTORS

WHO WE ARE

At Waters, we believe that tone for excellence and integrity is set at the top — with us, the Board. In this Proxy Statement, we highlight examples of our strong oversight actions and the exceptional stature, accomplishments, and diversity of expertise and experience amongst our members.

Our Board is comprised of Directors with extensive industry experience and a broad set of skills, attributes, and backgrounds critical to providing us with strategic and operational oversight. The Company believes that the decision-making of the Board of Directors is enriched when multiple viewpoints contribute to the discussion of matters within its purview. Creating a Board with a diversity of perspectives and experiences is important to the Company and the Board is committed to this objective. True to this objective, in August 2024, Heather Knight was appointed to the Board. Ms. Knight is an accomplished leader with decades of experience across the pharmaceutical and medical device industries, with a proven track record for driving growth and innovation.

Director Tenure & Background

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Board Committee Composition

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Director Experience and Skills Matrix

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Required Vote and Recommendation of the Board of Directors

A nominee for director shall be elected to the Board by a majority vote (i.e., the votes cast for such nominee must exceed the votes cast against such nominee) at any meeting of shareholders for the election of directors at which a quorum is present, except that directors will be elected by a plurality of the votes cast in a contested election. A “contested election” is one in which the Secretary of the Company receives a notice that a shareholder intends to nominate one or more persons for election to the Board in purported compliance with the Bylaws and such nomination notice has not been subsequently withdrawn or on prior to the tenth day before the notice of meeting is first mailed. If an incumbent director fails to be re-elected by a majority vote when such a vote is required and offers to resign, and if that resignation is not accepted by the Board, such director shall continue to serve until the next annual meeting and until his or her successor is duly elected, or his or her earlier resignation or removal. If an incumbent director’s resignation is accepted by the Board, or if a nominee for director is not elected and the nominee is not an incumbent director, then the Board, in its sole discretion, may fill any resulting vacancy or may decrease the size of the Board. “Abstentions” and shares with respect to which a broker or representative does not vote on a particular matter because it does not have discretionary voting authority on that matter (so-called “broker non-votes”) are counted as present for the purpose of determining whether a quorum is present. Abstentions and broker non-votes will not be treated as votes cast with respect to any nominee and therefore will not have an effect on the determination of whether a nominee has been elected.

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HOW WE ARE SELECTED AND ELECTED

Ten Directors are to be elected at the Annual Meeting, each to hold office until his or her successor is elected and qualified or until his or her earlier resignation, death or removal. It is intended that the Proxies in the form included with this Proxy Statement will be voted for the nominees set forth above unless shareholders specify to the contrary in their Proxies or specifically abstain from voting on this matter.

Majority Voting

The Company’s bylaws (the “Bylaws”) provide for majority voting for Directors in uncontested elections. A further description of the Company’s majority voting provisions can be found above.

Board Candidates

The Nominating and Corporate Governance Committee, together with the Board, is responsible for assessing the appropriate skills, attributes, experiences, and diversity of background that we seek in Board members in the context of the existing composition of the Board.

The Nominating and Corporate Governance Committee believes that candidates for service as a Director of the Company should meet certain minimum qualifications. The Company’s Corporate Governance Guidelines (the “Guidelines”) and Nominating and Corporate Governance Committee’s charter clarify that when assessing candidates for Director, the Nominating and Corporate Governance Committee considers candidates’ skills, experience, and diversity (such as, and including but not limited to, diversity of skills, experiences, and backgrounds), and seeks individuals who are highly accomplished in their respective fields, with superior educational and professional credentials. The Nominating and Corporate Governance Committee strives to maintain an appropriate balance of tenure, skills, and experience, with our average director tenure being approximately five years. The Board does not maintain term limits, and, in 2024, the Board amended the Guidelines to remove the mandatory retirement age for directors, as the Board believes that continuity of service can provide stability and valuable insight. Candidates should also satisfy the Company’s independence criteria, which are part of its Guidelines and summarized below, and follow the applicable listing standards of the New York Stock Exchange (the “NYSE”).

The Nominating and Corporate Governance Committee also seeks to ensure proper engagement from each of the Directors and effective functioning of the Board. The Company’s Guidelines provide that a Director may serve on other public company boards so long as such Director is able to devote the time necessary to properly discharge his or her duties and responsibilities to the Board, except that no director may serve simultaneously on the audit committees of more than three public companies (including the Company) unless the Board first has determined that such simultaneous service would not impair the ability of such member to serve on the Board’s Audit & Finance Committee. The Company does not impose specific thresholds on the number of other public company boards its Directors may serve on as the Company believes such thresholds are arbitrary and do not permit the Board to review the facts and circumstances involved in a particular Director’s decision to serve on the board of more than one public company. As part of the Nominating and Corporate Governance Committee’s discussions about individuals to recommend for nomination to serve as directors of the Company and to which committees those directors will be assigned, the Nominating and Corporate Governance Committee considers whether an individual’s other commitments are likely to interfere with such individual’s ability to properly discharge his or her duties to the Board and any Committees on which he or she may serve. Such evaluation is based on the facts and circumstances relating to each individual’s commitments, whether known to the Nominating and Governance Committee through discussion with the individual or other directors who have experienced similar obligations, or through such individual’s historic performance as a director, in the case of individuals who are then serving as a director of the Company.

The Company has a process for identifying and selecting candidates for Board membership. Initially, the Chair, the President and Chief Executive Officer (“CEO”), the Nominating and Corporate Governance Committee, or other Board members identify a need either to expand the Board with a new member possessing certain

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specific characteristics or to fill a vacancy on the Board. A search is then undertaken by the Nominating and Corporate Governance Committee, working with recommendations and input from Board members, members of senior management, professional contacts, external advisors, nominations by shareholders, and/or the retention of a professional search firm, if necessary. Any shareholder wishing to propose a nominee should follow the process described in the Bylaws to submit the candidate’s name and appropriate biographical information to the Company, c/o Secretary, at 34 Maple Street, Milford, MA 01757. In addition to satisfying the requirements of the Bylaws, to comply with the SEC’s universal proxy rules, any shareholder intending to solicit proxies in support of a nominee other than the Company’s nominees must also comply with the additional requirements of Rule 14a-19 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”).

An initial slate of candidates is identified that will satisfy the criteria for Board membership and is presented to the Nominating and Corporate Governance Committee for review. Upon review by the Nominating and Corporate Governance Committee, a series of interviews of one or more candidates is conducted by the Chair, the President and CEO, and at least one member of the Nominating and Corporate Governance Committee. During this process, the full Board is informally apprised of the status of the search and its input is solicited.

Upon identification of a final candidate, the entire Nominating and Corporate Governance Committee will meet to consider the credentials of the candidate and thereafter, if approved, will submit the candidate for approval by the full Board.

Proxy Access

The Board has adopted a proxy access bylaw provision that allows eligible shareholders or groups of up to 20 shareholders who have held at least 3% of our common stock continuously for three years to nominate up to two individuals or 20% of the Board, whichever is greater, for election at our annual shareholder meeting, and to have those individuals included in our proxy materials for that meeting.

Board/Director Independence

The Company’s Guidelines include the Company’s categorical standards of independence, which our Board approved, and the Guidelines provide criteria adopted by the Board to assist it in making determinations regarding the independence of its members. Those criteria, summarized below, are consistent with the NYSE listing standards regarding director independence. To be considered independent, the Board must determine that a director does not have a material relationship, directly or indirectly, with the Company. A director will not be considered independent if:

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In addition, a director will not be considered independent if he or she is an executive officer of a tax-exempt entity that receives contributions in any fiscal year from the Company exceeding the greater of $1 million or 2% of its gross revenues (excluding the Company’s matching of employee charitable contributions). A director also will not be considered independent if he or she is a current employee of an internal or external auditor of the Company.

The Board has determined that each Director, other than Dr. Batra, the Company’s President and CEO, has no material relationship with the Company and otherwise qualifies as “independent” under these criteria and the applicable listing standards of the New York Stock Exchange.

HOW WE ARE EVALUATED

The Nominating and Corporate Governance Committee conducts an annual evaluation of the Board and each of its committees. In December 2024, the evaluation, in the form of a questionnaire, was circulated to all members of the Board and each committee. The Company’s General Counsel received all of the questionnaires, compiled the results, and circulated them to the Board and each committee for discussion and analysis during January 2025. It is the intention of the Nominating and Corporate Governance Committee to continue to engage in this process annually.

HOW WE GOVERN AND ARE GOVERNED

At Waters, we believe that sound principles of corporate governance are essential to protecting Waters’ reputation, assets, investor confidence, customer loyalty, and sustainability. Our Guidelines can be found on our website at ir.waters.com/esg/governance-documents and are available in print upon written request to the Company, c/o Secretary, at 34 Maple Street, Milford, MA 01757.

We also believe in sound principles of board governance — how we govern ourselves sets the tone for how our company is governed more generally. Our board governance practices include:

✓ Proxy Access As described above, the Company enables eligible shareholders to nominate director candidates via our proxy access process as governed by our Bylaws.

✓ Majority Approval Required for Director Elections If an incumbent Director up for re-election at a meeting of shareholders fails to receive a majority of affirmative votes in an uncontested election, the Board will adhere to the director resignation process as provided in our Bylaws.

✓ Independent Board and Committees All Directors other than our President and CEO, and all members of the Audit & Finance Committee, the Compensation Committee, the Nominating and Corporate Governance Committee, and the Science and Technology Committee are independent.

✓ Engaged in Strategy Our Board is engaged in advising and overseeing the Company’s strategy and strategic priorities.

✓ Director Qualifications and Evaluations All of our independent Directors meet the candidate qualifications set forth in our Guidelines and as summarized in the above sections of this Proxy Statement: “— How We Are Selected and Elected — Board Candidates” and “— How We Are Selected and Elected — Board/Director Independence”.

✓ Regular Executive Sessions of Independent Directors Our independent Directors meet privately on a regular basis. Our Chair presides at such meetings.

✓ Stock Ownership Requirements We have robust stock ownership requirements for our Directors and executive officers.

✓ Enterprise Risk Management We have an enterprise risk management framework to identify, assess, manage, report, and monitor enterprise risk, including cybersecurity risk, and areas that may affect our ability to achieve our objectives.

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✓ Cybersecurity Our Audit & Finance Committee oversees our cybersecurity risk management and actively works with the Board and management to identify, assess, manage, report, and monitor such cybersecurity risks on at least a quarterly basis, and more frequently if necessary.

✓ Human Capital Management Our Board dedicates a meeting session to a review of talent, as well as matters related to succession planning.

✓ Director Orientation and Ongoing Director Education Our Board, with management support, hosts a director orientation program for new directors. The Board also administers a twice-yearly director education program, the topics for which are selected by the Board’s Nominating and Corporate Governance Committee.

✓ Board and Committee Oversight of ESG Our Board has delegated oversight of the Company’s environmental, sustainability and governance policies and practices to its Nominating and Corporate Governance Committee, which reports out to the Board at least annually on our efforts to leave the world better than we found it.

Shareholder Engagement

Our Board and management are committed to regular shareholder engagement and value constructive feedback to ensure alignment with shareholder interests on matters related to strategy, performance and results, corporate governance, sustainability, and executive compensation, among other topics. Our Investor Relations team regularly engages with shareholders on these topics, and that feedback is shared with management and the Board at least quarterly. Incorporating and addressing valuable feedback and insights from our shareholders is a key component in the deliberations and decision-making processes of the Board and management.

Say-on-Pay

Our shareholders vote annually on a non-binding, advisory basis, on the compensation of our executive officers, which we call our Say-on-Pay shareholder vote. The Company takes the support of our shareholders seriously and actively solicits feedback from our shareholders on our compensation programs. Shares voted in favor of our executive compensation program in fiscal year 2024 represented approximately 80% of votes cast.

Listening to Our Shareholders

Over the last several years, the Compensation Committee has made changes to our executive compensation program driven by changes in business and market practices, as well as shareholder feedback. A majority of our shareholders continue to have favorable views of our executive compensation program overall, including our emphasis on performance-based compensation and the strength of our performance goals. Our shareholders have provided constructive feedback to the Company in certain areas of our executive compensation program. In response to feedback requesting that a majority of our long-term incentive award consist of performance-based equity, we have rebalanced our mix to 55% PSUs, 30% stock options and 15% RSUs, commencing with fiscal year 2025. The Compensation Committee continues to believe that revenue and operating income are key drivers of our Company today and further that rTSR enhances our alignment with shareholders.

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Grants of Plan-Based Awards

The table below sets forth certain information with respect to the grant of plan-based awards made to our NEOs during the fiscal year ended December 31, 2024.

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Narrative Disclosure to the Summary Compensation Table and the Grants of Plan Based Awards Table

Dr. Batra, Messrs. Carpio and Chaubal and Ms. Bennett are each party to an employment agreement or offer letter with us.

Pursuant to Dr. Batra’s employment agreement, which was entered into in connection with his commencement of employment with us in 2020, he is entitled to an initial base salary of $1,000,000, which has subsequently been increased, and is entitled to a target annual incentive bonus equal to 125% of his base salary. In 2021, Mr. Chaubal and Ms. Bennett each entered into an offer letter with us in connection with their respective commencements of employment, which entitled them to an initial annual base salary of $500,000 and $568,000, respectively, which have subsequently been increased, and a target annual incentive bonus equal to 75% of their base salaries. In 2024, Mr. Carpio entered into an offer letter with us in connection with the commencement of his employment, which entitled him to an initial annual base salary of $580,000 and a target annual incentive bonus equal to 75%.

Each of our NEOs is entitled to participate in our employee benefit plans. The severance payments and benefits to which each of our NEOs are entitled are described under the “— Payments Upon Termination or Change of Control” section of this Proxy Statement. Each of our NEOs were eligible to participate in the Company’s AIP for 2024.

Each of our NEOs were granted non-qualified stock options in fiscal year 2024. These options vest 20% annually on the first five anniversaries of the date of grant (subject to continued employment through the applicable vesting date), have a ten-year term, and have an exercise price equal to the closing market price of the Company’s common stock on the date of grant.

Each of Dr. Batra, Mr. Chaubal and Ms. Bennett were granted PSUs in fiscal year 2024. These PSU awards may performance-vest 50% based on the Company’s rTSR over a three-year performance period and 50% based on the Company’s three-year OCCRG. The PSUs, to the extent earned, vest after the end of the three-year performance period, subject to continued employment through the vesting date of the award. The maximum payout for PSUs is 200% of target. If the Company’s TSR is negative, in no event will more than 100% of the target number of shares subject to the rTSR-based portion of the PSU award be earned. In addition, there is a post-vesting holding requirement for shares earned from PSU awards of one year (or two years for the CEO).

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Outstanding Equity Awards

The table below sets forth the outstanding equity awards held by each of our NEOs as of December 31, 2024.

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Option Exercises and Stock Vested

The table below sets forth certain information regarding stock option awards exercised by, and shares of our common stock delivered upon vesting of stock awards to, our NEOs during the fiscal year 2024.

Non-Qualified Deferred Compensation

The table below summarizes the non-qualified deferred compensation plan benefits for our NEOs in fiscal year 2024.

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