Company: IPGP
Filing Date: 2025-02-20
Form Type: 10-K
Source: 0001111928-25-000023
Chunk: 41

Company: IPG PHOTONICS CORP
Filing Date: 2025-02-20
Form: 10-K
Item: Item 16
Chunk 41
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, respectively, and the obligations related to raw materials and equipment are generally expected to be fulfilled within one year.Legal Proceedings — From time to time, the Company may be involved in legal disputes and other proceedings in the ordinary course of its business. These matters may include allegations of infringement of intellectual property, commercial disputes and employment matters. As of December 31, 2024, management believes these matters will not have a material effect, either individually or in the aggregate, on the Company's consolidated financial statements.In December 2024, affiliates of Trumpf SE & Co. KG (“Trumpf”) filed patent lawsuits in two different Unified Patent Courts located in Germany against IPG Laser GmbH & Co. KG alleging infringement of two patents granted by the European Patent Office by the Company's adjustable mode beam (AMB) lasers. The Company's AMB lasers are used in the welding of electric vehicle batteries as well as structural welding.  The matter is still in its early stages and the Company intends to defend it vigorously. No loss was deemed probable at December 31, 2024 and therefore no amounts have been accrued in respect of this contingency. As of December 31, 2024 and through the date of the Company's subsequent review period of February 20, 2025, the Company is aware of no other ongoing legal proceedings that management estimates could have a material effect on the Company's consolidated financial statements.

F-23

Table of ContentsIPG PHOTONICS CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)(In thousands, except share and per share data)

15. STOCK-BASED COMPENSATION

Stock-based compensation, including the employee stock purchase plan, is included in the following financial statement captions:  Year Ended December 31, 202420232022Cost of sales$8,687 $7,929 $11,741 Sales and marketing5,941 5,421 4,889 Research and development10,239 9,396 7,585 General and administrative12,283 16,858 14,120 Total stock-based compensation37,150 39,604 38,335 Tax effect of stock-based compensation(8,191)(8,660)(8,261)Net stock-based compensation$28,959 $30,944 $30,074 Incentive Plans — In 2006, the Company's stockholders approved the 2006 Incentive Compensation Plan (as