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

(Amendment No.     )

Filed by the Registrant  ☑                                     Filed by a Party other than the Registrant  ☐

Check the appropriate box:

DRIL-QUIP, INC.

(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):

Notes:

Reg. § 240.14a-101.

SEC 1913 (3-99)

Notice of 2021 Annual Meeting and Proxy Statement

May 12, 2021 at 10:00 a.m.

ESG

“Environmental, Social and Governance (ESG) is an important focus area at Dril-Quip. We are committed to operating in a manner that promotes human rights, health and safety, and ethical behavior in all the countries in which we conduct business, reducing our own greenhouse gas emissions footprint, and helping the world transition to a low-carbon future. As a Participant of the United Nations (UN) Global Compact, we support the organization’s Ten Principles on human rights, labor, environment, and anti-corruption.”

- Jeffrey J. Bird, President and Chief Executive Officer

		Environment We recognize that climate change is an issue that warrants attention across all aspects of our business. We are committed to environmental stewardship by actively engaging in sustainable practices throughout our operations and doing our part, as a member of the greater energy industry, to deliver products that allow our customers to responsibly provide greater access to affordable, reliable energy for people everywhere. All of our major manufacturing facilities are compliant with OHSAS 18001 (occupational health and safety management systems) and ISO 14001 (for environmental management systems). In alignment with our Goal Zero initiative, we strive to improve our HSE policies to minimize safety risks and hazards.
		Social We are committed to building a diverse, inclusive, engaged, and empowered workforce to enable us to manage our business with a focus on health and safety, the environment, ethical behavior, quality and being a good corporate citizen in all countries in which we operate. Dril-Quip, Inc. (“we,” “Company” or   LETTER TO OUR STOCKHOLDERS  “Dril-Quip”) has a long-standing commitment to support equal opportunity for all. Dril-Quip is committed to providing equal opportunities in all aspects of employment and we maintain policies that prohibit any discrimination or harassment on the basis of race, color, national origin, genetic information, religion, gender, pregnancy, marital status, sexual orientation, age, disability or military service.
		Governance Dril-Quip has a majority independent board and split CEO and chairperson roles, factors which are aligned with long-term shareholder interests. Our Corporate Governance Guidelines include the Company’s policies regarding the Board of Directors, including but not limited to, director qualifications and responsibilities, election of directors, director compensation, and stock ownership guidelines. Our Code of Business Conduct and Ethical Practices articulates our corporate values and explains how they should guide ethical decision-making for all of our employees, officers, directors, and subsidiaries. It is designed to ensure that how we do business is fully aligned with our values and applicable laws and regulations in regions and countries that we operate in. Dril-Quip’s Code of Business Conduct and Ethical Practices applies to all directors, officers, and employees of the Company and is the foundation of our compliance program. Our Anti-Corruption Policy prohibits all forms of bribery, including the payment of money, offers, gifts, promises to give, or authorizations of the giving of anything of value to any foreign official (including employees of foreign national oil companies) for the purpose of securing a business advantage.

March 30, 2021

Dear Stockholder:

You are cordially invited to attend the annual meeting of stockholders to be held at the Company’s worldwide headquarters, 6401 N. Eldridge Parkway, Houston, Texas, on May 12, 202117, 2022 at 10:009 a.m. For those of you who cannot be present at this annual meeting, we urge that you participate by voting your proxy over the Internet, by telephone or mail at your earliest convenience.

This booklet includes the notice of the meeting and the proxy statement, which contains information about the Board of Directors of the Company (the “Board” or “Board of Directors) and its committees and personal information about the nominees for the Board. Other matters on which action is expected to be taken during the meeting are also described.

It is important that your shares are represented at the meeting, whether or not you are able to attend personally. Accordingly, please vote your proxy over the Internet, by telephone or, if printed proxy materials are mailed to you, by signing, dating and mailing promptly the enclosed proxy in the envelope provided.

		On behalf of the Board of Directors, thank you for your continued support. Jeffrey J. Bird Chief Executive Officer

March 29, 2022

Blake T. DeBerry

Chief Executive Officer

Notice of Annual Meeting of StockholdersNOTICE OF ANNUAL MEETING OF STOCKHOLDERS

The Board of Directors has fixed March 18, 202121, 2022 as the record date for determining stockholders entitled to notice of, and to vote at, the meeting or any reconvened meeting after an adjournment thereof, and only holders of common stock of record at the close of business on that date will be entitled to notice of, and to vote at, the meeting or any reconvened meeting after an adjournment.

You are cordially invited to attend the meeting in person. Even if you plan to attend the meeting, however, you are requested to vote your proxy over the Internet, by telephone or, if printed proxy materials are mailed to you, by marking, signing, dating and returning the accompanying proxy in the envelope provided as soon as possible.

We continue to monitor developments regarding COVID-19. We would like to emphasize that the health of our stockholders, employees and other attendees remains a top priority. We strongly urge you to appoint a proxy to vote at the Annual Meeting on your behalf, as this is the preferred means of fully and safely exercising your right to vote. In the event that our meeting venue has restricted access due to the COVID-19 pandemic, we will communicate this information to our stockholders by way of announcement, which will be published on the investor relations page of our website at https://drilquip.gcs-web.com/ and, if required, included in our filings with the SEC. We recommend that stockholders keep apprised of public official guidance regarding travel, self-isolation and other health and safety precautions.

By Order of the Board of Directors

Blake T. DeBerryJeffrey J. Bird

Chief Executive Officer

March 30, 202129, 2022

PROXY VOTING

Your vote is important. Please vote promptly so your shares can be represented, even if you plan to attend the annual meeting. You can vote by Internet at http://www.envisionreports.com/DRQ.com, by telephone at 1-800-652-8683 or by requesting a printed copy of the proxy materials and using the proxy card enclosed with the printed materials.

IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS

FOR THE STOCKHOLDER MEETING TO BE HELD ON MAY 12, 2021.17, 2022.

The Proxy Statement, our annual report and other proxy materials

are available at http://www.edocumentview.com/DRQ.

TABLE OF CONTENTS

TABLE OF CONTENTS

PROXY STATEMENT

INTRODUCTIONIntroduction

This proxy statement is furnished in connection with the solicitation by the Board of Directors of Dril-Quip, Inc., a Delaware corporation, of proxies from the holders of our common stock, par value $0.01 per share, for use at the 20212022 Annual Meeting of Stockholders to be held at the time and place and for the purposes set forth in the accompanying notice. We are furnishing proxy materials to our stockholders primarily via the Internet, instead of mailing printed copies of those materials to each stockholder. We expect to provide notice and electronic delivery of this proxy statement and the accompanying proxy to stockholders on or about March 30, 2021.29, 2022. If you would prefer to receive a paper copy of our proxy materials, please follow the instructions included in the notice.

In addition to the solicitation of proxies by mail, proxies may also be solicited by telephone or personal interview by our regular employees. We will pay all costs of soliciting proxies. We will also reimburse brokers or other persons holding stock in their names or in the names of their nominees for their reasonable expenses in forwarding proxy materials to beneficial owners of such stock.

RECORD DATE AND VOTING SECURITIESRecord Date And Voting Securities

As of the close of business on March 18, 2021,21, 2022, the record date for determining stockholders entitled to notice of and to vote at the annual meeting, we had outstanding and entitled to vote 35,428,77834,792,487 shares of common stock. Each share entitles the holder to one vote on each matter submitted to a vote of stockholders.

The requirement for a quorum at the annual meeting is the presence in person or by proxy of holders of a majority of the outstanding shares of our common stock. Proxies indicating stockholder abstentions and shares represented by “broker non-votes” (i.e., shares held by brokers or nominees for which instructions have not been received from the beneficial owners or persons entitled to vote and for which the broker or nominee does not have discretionary power to vote on a particular matter) will be counted for purposes of determining whether there is a quorum at the annual meeting. Votes cast by proxy or in person at the annual meeting will be counted by the persons appointed as election inspectors for the annual meeting.

Brokers holding shares must vote according to specific instructions they receive from the beneficial owners of those shares. If brokers do not receive specific instructions, brokers may in some cases vote the shares in their discretion. However, the New York Stock Exchange, or NYSE, precludes brokers from exercising voting discretion on certain proposals without specific instructions from the beneficial owner. Importantly, NYSE rules expressly prohibit brokers holding shares in “street name” for their beneficial holder clients from voting on behalf of those clients in uncontested director elections or on matters that relate to executive compensation without receiving specific voting instructions from those clients. Under NYSE rules, brokers will have discretion to vote only on Proposal 2 (approval of the appointment of independent registered public accounting firm). Brokers cannot vote on Proposal 1 (election of directors), or Proposal 3 (advisory vote to approve executive compensation) or Proposal 4 (approval of amendment to the Company’s 2017 Omnibus Incentive Plan) without instructions from the beneficial owners. If you do not instruct your broker how to vote on these matters, your broker will not vote for you.

All duly executed proxies received prior to the annual meeting will be voted in accordance with the choices specified thereon and, in connection with any other business that may properly come before the meeting, in the discretion of the persons named in the proxy. As to any matter for which no choice has been specified in a duly executed proxy, the shares represented thereby will be voted FOR the election as director of the nominees listed herein, FOR approval of the appointment of PricewaterhouseCoopers LLP as our independent registered public accounting firm, FOR approval, on an advisory basis, of the compensation of our named executive officers FOR approval of the amendment to the Company’s 2017 Omnibus Incentive Plan and in the discretion of the persons named in the proxy in connection with any other business that may properly come before the annual meeting.

2021 Proxy Statement    1

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth the number of shares of our common stock beneficially owned directly or indirectly as of March 18, 202121, 2022 or as otherwise indicated below by (i) each person who is known to us to own beneficially more than 5% of our common stock, (ii) each of our directors, director nominees and executive officers and (iii) all directors, director nominees and executive officers as a group.

2021 Proxy Statement    3

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

4    2021 Proxy Statement3

PROPOSAL 1    Election of Directors

Our Board of Directors is divided into three classes, Class I, Class II and Class III, with staggered terms of office ending in 2022, 2023 and 2021,2024, respectively. The term for each class expires on the date of the third annual stockholders’ meeting for the election of directors following the most recent election of directors for such class. Each director holds office until the next annual meeting of stockholders for the election of directors of his or her class or until his or her successor has been duly appointed or elected and qualified.

Our Board of Directors has nominated each of Mr. NewmanWillis, Mr. Jupp and Ms. SchwetzLockhart for election as a director to serve a three-year term expiring on the date of the annual meeting of stockholders to be held in 20242025 (or until a successor is duly appointed or elected and qualified). Mr. NewmanWillis, Mr. Jupp and Ms. SchwetzLockhart currently serve as members of our Board of Directors. In accordance with our bylaws, directors are elected by a majority of the votes cast at the meeting. This means that the number of shares voted “for” a director must exceed the number of votes cast “against” that director. Abstentions and broker non-votes will not affect the outcome of the vote. For additional information on the election of directors, see “Corporate Governance Matters — Majority Voting in Director Elections.”

Our Board of Directors has no reason to believe that Mr. NewmanWillis, Mr. Jupp and Ms. SchwetzLockhart will not be candidates for director at the time of the annual meeting or will be unable to serve as directors. If Mr. NewmanWillis, Mr. Jupp or Ms. SchwetzLockhart becomes unavailable for election, our Board of Directors can name a substitute nominee, and proxies will be voted for the substitute nominee pursuant to discretionary authority, unless withheld.

Board Composition (excluding Mr. Shukis who is not standing for re-election)

2021 Proxy Statement    54

PROPOSAL 1    Election of Directors

Skills Matrix Lite (excluding Mr. Shukis who is not standing for re-election)

The Board of Directors recommends that you vote FOR the election of the nominees listed below. Properly dated and signed proxies will be so voted unless authority to vote in the election of directors is withheld.

Nominees for Class IIII Director for Three-Year Term to Expire in 20242025

The following sets forth information concerning the nominees for election as a director at the annual meeting, including each nominee’s age as of March 18, 2021,21, 2022, position with us, business experience during the past five years and the experiences, qualifications, attributes or skills that caused our Nominating and Governance Committee and the Board to determine that the nominees should serve as directors of the Company.

5

PROPOSAL 1    Election of Directors

6    2021 Proxy Statement

Information Concerning Class III and Class IIIII Directors

The following sets forth information concerning the Class III and Class IIIII directors whose present terms of office will expire at the 20222023 and 20232024 annual meetings of stockholders, respectively, including each director’s age as of March 18, 2021,21, 2022, position with us, if any, business experience during the past five years and the experiences, qualifications, attributes or skills that caused our Nominating and Governance Committee and the Board to determine that the nominees should serve as directors of the Company.

Class III

2021 Proxy Statement    7

PROPOSAL 1    Election of Directors

Class III

8

CORPORATE GOVERNANCE MATTERS

CORPORATE GOVERNANCE MATTERS

Board Leadership Structure

The offices of Chair of the Board and Chief Executive Officer are currently separate and have been separate since October 2011. At that time, the Board of Directors appointed Mr. Lovoi as ChairmanChair of the Board and Blake T. DeBerry as President and Chief Executive Officer.Board.

The Board does not have a policy requiring either that the positions of the Chair of the Board and the Chief Executive Officer should be separate or that they should be occupied by the same individual. The Board believes that this issue is properly addressed as part of the succession planning process and that it is in the best interests of the Company for the Board to make a determination on the matter when it elects a new chief executive officer or at other times consideration is warranted by circumstances. The Board believes that this structure enables it to fulfill its oversight role in determining the manner in which its leadership is configured with a view toward flexibility and maintaining a structure that best serves our Company and its stockholders.

The Board believes that the current separation of these two important roles is in the best interest of the Company and its stockholders at this time. This structure permits the Chair to direct board operations and lead the Board in its oversight of management and the Chief Executive Officer to develop and implement the Company’s board-approved strategic vision and manage its day-to-day business. The separation of duties also allows Mr. Lovoi and Mr. DeBerryBird to focus on their responsibilities as ChairmanChair and Chief Executive Officer, respectively. The Board believes that the independent board chair helps provide an opportunity for Board members to provide more direct input to management in shaping our organization and strategy and strengthens the Board’s independent oversight of management. To that end, at each regularly scheduled Board meeting, our non-management directors hold executive sessions at which our management is not in attendance. Mr. Lovoi, as Chairman,Chair, presides at these sessions.

Board’s Role in the Oversight of Risk Management

The Board believes that the administration of its risk oversight function has not affected its leadership structure. In reviewing our compensation program, the Compensation Committee has made an assessment of whether compensation policies and practices create risks that are reasonably likely to have a material adverse effect on us and has concluded that they do not create such risks as presently constituted.

2021 Proxy Statement    9

Determinations of Director Independence

Under rules adopted by the NYSE, no board member qualifies as independent unless the Board of Directors affirmatively determines that the director has no material relationship with us. In evaluating each director’s independence, the Board considers all relevant facts and circumstances in making a determination of independence. In particular, when assessing the materiality of a director’s relationship with us, the Board considers the issue not merely from the standpoint of the director, but also from the standpoint of persons or organizations with which the director has an affiliation.

As contemplated by the rules of the NYSE then in effect, the Board adopted categorical standards in 2004 to assist the Board of Directors in making independence determinations. Under the NYSE rules then in effect, immaterial relationships that fall within the guidelines were not required to be disclosed separately in proxy statements. As set forth in our Corporate Governance Guidelines, a relationship falls within the categorical standard if it:

In its determination of independence, the Board of Directors reviewed and considered all relationships and transactions between each director, his or her family members or any business, charity or other entity in which the director has an interest, on the one hand, and we, our affiliates, or our senior management has an interest, on the other. The Board considered the relationships and transactions in the context of the NYSE’s objective listing standards, the categorical standards noted above and the additional standards established for members of audit, compensation and governance committees. As part of its review, the Board considered ordinary course transactions between the Company and Chrysaor Holdings Limited (“Chrysaor”). In particular, the Board considered that Mr. Jupp served as a member of the Board of Directors of Chrysaor during 2020until March 31 2021, at which time it merged with Premier Oil plc (“Premier”) and was renamed Harbour Energy plc. (“Harbour”), and that the total amount of payments made by Chrysaor, made paymentsPremier and Harbour in 2021 for products purchased from the Company of approximately $911,882 in 2020.was $10,185,773. These payments represent approximately 0.013%3.2% of the Company’s consolidated gross revenues in 2020,2021, and approximately 0.04%0.3% of Chrysaor’sHarbour’s consolidated gross revenues in 2020.2021. The Board also considered that Chrysaor may order additional products fromMr. Willis was employed as a corporate officer of Microsoft Corporation (“Microsoft”) and that the Company made payments of approximately $621,081 in 2021 for products and services provided by Microsoft. These payments represent approximately 0.2% of the future.Company’s gross revenues in 2021, and approximately 0.0003% of Microsoft’s consolidated revenues in 2021. The Board has concluded that these transactions and relationships do not adversely affect Mr. Jupp’sthe ability or willingness of either Mr. Jupp or Mr. Willis to act in the best interests of the Company and its shareholders or otherwise compromise his independence, nor are similar transactions in the future expected to adversely affect Mr. Jupp’stheir independence. The Board took note of the fact that these transactions were on standard terms and conditions and that neither company was afforded any special benefits. The Board further noted that Mr. Jupp and Mr. Willis had no involvement in negotiating the terms of the purchases or interest in the transactions.

As a result of this review, the Board of Directors affirmatively determined that Messrs.Mr. Shukis, Mr. Jupp, Ms. Lockhart, Mr. Lovoi, Mr. Newman, and Shukis and Ms. Schwetz and Mr. Willis are independent from us and our management. In addition, the Board of Directors affirmatively determined that Messrs.Mr. Shukis, Mr. Jupp, Ms. Lockhart, Mr. Lovoi, Mr. Newman, and Shukis and Ms. Schwetz and Mr. Willis are independent under the additional standards for audit committee membership and compensation committee membership under rules of the SEC. The remaining director, Mr. DeBerry,Bird, is not independent because of his current service as a member of our senior management.

You can access our Independence Guidelines in our Corporate Governance Guidelines on the Investors section of our website at www.dril-quip.com.

10    2021 Proxy Statement

Code of Business Conduct and Ethical Practices

Pursuant to NYSE rules, we have adopted the Dril-Quip, Inc. Code of Business Conduct and Ethical Practices for our directors, officers and employees. The Code of Business Conduct and Ethical Practices, which also meets the requirements of a code of ethics under Item 406 of Regulation S-K, is posted on the Investors section of our website at www.dril-quip.com. Changes in and waivers to the Code of Business Conduct and Ethical Practices for our directors and executive officers will also be posted on our website.

Majority Voting in Director Elections

Our amended and restated bylaws include a majority voting standard in uncontested director elections. This standard applies to the election of directors at this meeting. To be elected in an uncontested election, a nominee must receive more votes cast “for” that nominee’s election than votes cast “against” that nominee’s election. In contested elections, the voting standard will be a plurality of votes cast. Under our bylaws, a contested election is one at which the number of candidates for election as directors exceeds the number of directors to be elected, as determined by our Corporate Secretary as of the tenth day preceding the date we mail or deliver a notice of meeting to stockholders.

Our Corporate Governance Guidelines include director advance resignation procedures. In brief, these procedures provide that:

Our Corporate Governance Guidelines can be found on the Investors section of our website at www.dril-quip.com.

Committees of the Board of Directors

The Board of Directors has appointed three committees: the Audit Committee, the Nominating and Governance Committee and the Compensation Committee.

Effective at the 2022 Annual Meeting, Mr. Shukis, who is not standing for re-election at the 2022 Annual Meeting, will no longer serve on the Audit Committee, the Nominating and Governance Committee or the Compensation Committee.

Audit Committee

The current members of the Audit Committee are Mr. Shukis, who serves as Chairman, Messrs.Chair, Mr. Jupp, Ms. Lockhart, Mr. Lovoi, Mr. Newman, Ms. Schwetz and Newman andMr. Willis. In connection with the 2022 Annual Meeting, Mr. Shukis will be replaced as Chair of the Audit Committee by Ms. Schwetz. The Board of Directors has determined that Mr. ShukisMs. Schwetz is an “audit committee financial expert” as such term is defined in Item 407(d)(5) of Regulation S-K promulgated by the SEC. In addition, the Company believes that certain other members of the Audit Committee could also qualify as “audit committee financial experts” if needed in the future.

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CORPORATE GOVERNANCE MATTERS

The Board of Directors has approved the Audit Committee Charter, which contains a detailed description of the Audit Committee’s duties and responsibilities. Under the charter, the Audit Committee has been appointed by the Board of Directors to assist the Board in overseeing (i) the integrity of our financial statements, (ii) our compliance with legal and

2021 Proxy Statement    11

Evaluating Candidates

The members of the Nominating and Governance Committee are responsible for assessing the skills and characteristics that candidates for election to the Board should possess, as well as the composition of the Board as a whole. This assessment will include the qualifications under applicable independence standards and other standards applicable to the Board and its committees, as well as consideration of skills and experience in the context of the needs of the Board. The charter of the Nominating and Governance Committee requires the committee to evaluate each candidate for election to the Board in the context of the Board as a whole, with the objective of recommending individuals that can best perpetuate the success of our business and represent stockholder interests through the exercise of sound business judgment using their diversity of experience in a number of areas. Each candidate must meet certain minimum qualifications, including:

The Nominating and Governance Committee may also consider the ability of the prospective candidate to work with the then-existing interpersonal dynamics of the Board and her or his ability to contribute to the collaborative culture among Board members.

Based on this initial evaluation, the Nominating and Governance Committee will determine whether to interview the candidate, and, if warranted, will recommend that one or more of its members and senior management, as appropriate, interview the candidate in person or by telephone. After completing this evaluation and interview process, the Nominating and Governance Committee recommends to the Board a slate of director nominees for election at the next annual meeting of stockholders or for appointment to fill vacancies on the Board.

Board Diversity

The charter of the Nominating and Governance Committee was amended in October 2017 to specifically ensure that qualified women and minority candidates are included in director searches. At the request of the Nominating and Governance Committee, the Company recently engaged a national recruiting firm to assist the Company in its efforts to add a board member, with racial diversity being a primary focus.

Information Regarding Meetings

During 2020,2021, the Board of Directors held fivefour meetings. The Audit Committee met four times, the Nominating and Governance Committee met twice and the Compensation Committee met three times.twice. During 2020,2021, all current directors, other than Ms. Lockhart, who was not a member of the Board of Directors, attended at least 75% of the aggregate of the total number of meetings of the Board of Directors and the total number of meetings of the committees of the Board of Directors held during the period of such director’s service.

We expect, but do not require, Board members to attend the annual meeting. Last year, all of our Board members attended the annual meeting.

Stockholder Communications

Stockholders and other interested parties may communicate directly with our independent directors by sending a written communication in an envelope addressed to “Board of Directors (Independent Members)” in care of the Corporate Secretary at the address indicated on the first page of this proxy statement.

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CORPORATE GOVERNANCE MATTERS

Website Availability of Governance Documents

You can access our Corporate Governance Guidelines, Code of Business Conduct and Ethical Practices, Audit Committee Charter, Nominating and Governance Committee Charter and Compensation Committee Charter on the Investors section of our website at www.dril-quip.com. Information contained on our website or any other website is not incorporated into this proxy statement and does not constitute a part of this proxy statement. Additionally, any stockholder who so requests may obtain a printed copy of the governance documents from the Corporate Secretary at the address indicated on the first page of this proxy statement.

Stockholder Engagement

In order to seek continued alignment with our stockholders, our executive officers meet with our stockholders from time to time to obtain their views on our performance. The feedback received from our stockholders is also shared with our Board of Directors. Part of the recent feedback from our stockholders focuses on our ability to generate free cash flowoperate efficiently on decreased revenues following the industry downturn and the ability to increase bookings.bookings as the market for oilfield services and equipment continues to improve. In response, we included a Free Cash Flowan Adjusted EBITDA element and a Bookings element to our annual cash incentives program for 20212022 to increase focus on both improving free cash flowoperational efficiencies and bookings. We also addedSimilar to 2020, our 2021 performance units have a reduced payout schedule to our 2020 performance units such that no more than 150% of 20202021 performance shares will be earned in the event our relative total stockholder return is negative. We will continue to regularly engage with our stockholders and consider their feedback on all aspects of our performance.

14    2021 Proxy Statement

RELATED PERSON TRANSACTIONS

The Board has adopted a written policy implementing procedures for the review, approval or ratification of related person transactions. Under the policy, a “related person” is any director, executive officer or more than 5% stockholder. The policy applies to any transaction in which (1) we are a participant, (2) any related person has a direct or indirect material interest and (3) the amount involved exceeds $120,000, but excludes any transaction that does not require disclosure under Item 404(a) of Regulation S-K. The Nominating and Governance Committee is responsible for reviewing, approving and ratifying any related person transaction. The Nominating and Governance Committee intends to approve only those related person transactions that are in, or are not inconsistent with, the best interests of us and our stockholders.

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DIRECTOR COMPENSATION

Overview

For the year ended December 31, 2020,2021, the non-employee ChairmanChair of the Board received an annual fee of $175,000 and the Company’s other non-employee directors received an annual fee of $75,000. In addition, each of the non-employee chairmenchairs of the Nominating and Governance Committee, Compensation Committee and Audit Committee of the Board received a supplemental annual fee of $10,000, $15,000 and $20,000, respectively. All directors are reimbursed for their out-of-pocket expenses and other expenses incurred in attending meetings of the Board or its committees and for other expenses incurred in their capacity as directors. SuchUpon the recommendation of the Nominating and Governance Committee, the Board increased the number of directors that constitute the Board by one additional member, effective June 21, 2021. The Board appointed Darryl K. Willis as a director to fill the vacancy resulting from the increase in the size of the Board, and Mr. Willis received fees are consistent withfor his services on the modified director service fees provided byBoard commencing as of June 21, 2021, the Company commencing on January 1, 2020.effective date of his appointment to the Board.

Under the Company’s 2017 Omnibus Incentive Plan (the “2017 Incentive Plan”), non-employee directors may be granted awards in the form of stock options, stock appreciation rights, stock awards, cash awards or performance awards. Upon the recommendation of the Compensation Committee, the Board granted 5,8675,947 shares of restricted stock to each of Messrs. Lovoi, Shukis, Jupp, Newman, and NewmanWillis and Ms. Schwetz in October 20202021 under the 2017 Incentive Plan. Such shares of restricted stock vest on the first anniversary of the date of grant subject to such director’s continued service through such date.

We maintain stock ownership guidelines applicable to our directors under which each non-employee director is expected to own Dril-Quip common stock valued at five times the then current annual cash retainer paid to such director. If, however, at any time the Chair of the Board is a non-employee and is receiving a retainer greater than that paid to the non-employee directors who are not Chair, of the Board the Chair of the Board is generally expected to own common stock valued at five times the then current annual cash retainer paid to non-employee directors who are not Chair of the Board.Board Chair. New directors are expected to attain the specified level of ownership within five years of becoming a director. At its most recent meeting, the Nominating and Governance Committee confirmed that all directors are in compliance with our stock ownership guidelines.guidelines or within the time period for acquiring the requisite share holdings.

The following table sets forth a summary of the compensation paid to our non-employee directors in relation to 2020:2021:

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The aggregate grant date fair values are computed in accordance with FASB ASC 718, “Share-Based Payment” (“ASC 718”), infor the following total amounts:restricted stock awards:

Assumptions used in the calculation of this amount are included in footnote 18 to our audited consolidated financial statements for the fiscal year ended December 31, 2020,2021, included in our Annual Report on Form 10-K filed with the SEC on February 25, 2021.23, 2022.

Director Stock Compensation Program

We maintain a stock compensation program for non-employee directors under the 2017 Incentive Plan. Under this program, non-employee directors have the option to receive all or a portion of their board and committee fees (but not expenses) in the form of restricted stock awards in an amount equal to 125% of such fees in lieu of cash. Each director may elect to take fees in the form of restricted stock prior to the beginning of the subject calendar year. Each director taking fees in the form of restricted stock receives his or her award attributable to a calendar quarter on or about the first business day of the next calendar quarter in an amount equal to 125% of the cash equivalent of his or her fees, with the number of shares determined by the closing stock price on the last trading day of the calendar quarter for which the fees are being determined. These awards fully vest on the first day of the second calendar year following issuance. The director stock compensation program is intended to encourage non-employee directors to acquire and hold common stock of the Company to align the interests of directors and the Company’s other stockholders. EachOther than Mr. Willis, who joined the Board during 2021, each of the non-employee directors elected to take all or a portion of their Board fees in the form of restricted stock during 2020,2021, and each of themthe non-employee directors (including Mr. Willis) has elected to take all or a portion of their Board fees in the form of restricted stock during 2021.2022.

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EXECUTIVE COMPENSATION

Compensation Discussion and Analysis

Overview

Purposes of the Executive Compensation Program

Our executive compensation program has been designed to accomplish the following objectives:

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EXECUTIVE COMPENSATION

Administration of Executive Compensation Program

Our executive compensation program is administered by the Committee. The specific duties and responsibilities of the Committee are described in this proxy statement under “Corporate Governance Matters — Committees of the Board of Directors — Compensation—Compensation Committee.” The Committee normally meets each February to determine annual incentive compensation earned during the prior year and to establish performance targets for the current year annual incentive compensation plan. The Committee also normally meets in October to determine any adjustments to base salaries for our executive officers and to award equity-based compensation. The Committee also meets at other times during the year and acts by written consent when necessary or appropriate.

Our Chief Executive Officer provides recommendations on any adjustments to the base salaries of our other executive officers. Our Chief Executive Officer also periodically reviews and recommends specific performance metrics to be used

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Realizable Pay Analysis

The ultimate value realized by our long-term compensation grants is heavily influenced by the performance of our stock, both on an absolute basis and relative to the Philadelphia Oil Service Index and, commencing with awards granted in 2020, the S&P 500 Index. The following chart compares the realizable value (as defined below) of long-term compensation grants made during the three-year period beginning on October 1, 20172018 and ending on September 30, 20202021 to the original grant date fair market value of such grants for each named executive officer.

2021 Compensation Highlights

The Committee made adjustments to the annual cash incentives program for 2021 to better align compensation with the Company’s objectives for 2021. The main changes are as follows:

Role of Consultants

The Committee has the authority to engage a third-party consultant at any time, and has continued to engage Meridian Compensation Partners, LLC (“Meridian”), to provide independent advice on executive compensation and evaluate and recommend appropriate modifications to our compensation program consistent with our program’s objectives. Meridian reports directly to the Committee, which pre-approves the scope of work and the fees charged. The Committee reviewed and

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EXECUTIVE COMPENSATION

In October 2020,2021, at the direction of the Committee, Meridian evaluated the base salary and annual and long-term incentive compensation of our named executive officers. As it had done in prior years for the Committee, Meridian used publicly available data from a peer group of oilfield service companies to assist in that analysis.

The peer group data used in October 20202021 in relation to compensation for the Company’s named executive officers for 20202021 was the same peer group used by Meridian in its October 20192020 report to the Committee, except that Hornbeck Offshore Services, Inc.ChampionX Corp. was removed as a result ofdue to its bankruptcylarger size and Apergy Corporation is now ChampionX Corp. following its mergerreplaced with the ChampionX subsidiary of Ecolab.Nine Energy Service, Inc., and DMC Global, Inc. replaced Frank’s International N.V., which was acquired by Expro Group. With those changes, the peer group consisted of the following 12 publicly traded oilfield services and equipment companies:

This peer group represents a group of companies in the oilfield services industry of comparable size to Dril-Quip based on measures such as enterprise value, revenues, market capitalization and assets. We believe that the use of this group as a reference for evaluating our compensation policies helps align us with our peers and competitors and ensure our compensation program remains competitive when compared to our competition for executive talent. We also believe this group of companies provides a sufficiently large data set that is generally not subject to wide changes in compensation data.

Pursuant to Meridian’s recommendations and its own analysis, the Committee has implemented the compensation program for our named executive officers as further described below.

Compensation Matters

In fulfilling its role, the Compensation Committee is authorized to:

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Elements of Compensation

General

Our executive compensation program generally consists of the following elements:

We primarily seek to reward achievement of our short-term goals with base salary and annual cash incentive compensation, while long-term interests are rewarded through long-term equity awards. We believe that base salaries should be at levels competitive with peer companies that compete with us for business opportunities and executive talent, and annual cash incentive compensation and long-term stock-based incentive awards should be at levels which reflect progress made toward our corporate goals and individual performance. In general, salary level and the target level of annual and long-term incentive compensation for each named executive officer are based on market data for the officer’s position. Compensation levels can vary compared to the market due to a variety of factors such as experience, scope of responsibilities, tenure and individual performance.

Relative Size of Major Compensation Elements

The relative sizes of the components of an executive’s compensation are determined in the sole discretion of the Committee, often with reference to recommendations by Meridian. Pursuant to their employment agreements, however, the Committee may not reduce the salary of our named executive officers without their consent.

Factors taken into account in determining compensation for all executive officers are our performance and the executive’s responsibilities, experience, leadership, potential future contributions and demonstrated individual performance. The Committee seeks to achieve the appropriate balance between immediate cash rewards for the achievement of performance objectives and long-term incentives that align the interests of our executive officers with those of our stockholders. In setting the target executive compensation levels, the Committee considers the aggregate compensation payable to an executive officer and the form of the compensation. The Committee also considered the results of the 20202021 advisory vote on executive compensation and, based upon the strong stockholder support of over 97%98% of votes cast in favor of our program, believes that its approach to executive compensation is appropriate.

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The following charts summarize the relative size of base salary and target incentive compensation opportunities for 20202021 for each of our named executive officers (excluding bonuses under the annual incentive compensation plan, which were cancelled for 2020).officers.

Base Salary

We evaluate base salaries for our named executive officers annually or as warranted by circumstances, including changes in positions. The base salaries for our Chief Executive Officer and our other executive officers are reviewed and approved by the Committee. Our Chief Executive Officer provides recommendations on adjustments to the base salary of our other executive officers. Base salary recognizes the job being performed and the value of that job in the competitive market. Base salary must be sufficient to attract and retain the executive talent necessary for our continued success and provide an element of compensation that is not at risk in order to avoid fluctuations in compensation that could distract our executives from the performance of their responsibilities.

Base salaries for our named executive officers are based on a review of numerous factors, including our financial and operating performance during the relevant period and the executive officer’s experience level and contribution to our success. Salary determinations are subjective and are not based on any formula. As in years past, the Committee and the Chief Executive Officer, as applicable, make an assessment of our actual financial results compared to our overall annual budget based on the financial statements as a whole, taking into account market and economic conditions unknown during the preparation of the relevant annual budgets. In addition, annual adjustments to base salaries also reflect changes or responses to changes in market data.

Mr. Kumar’s annual base salary was increased from $300,000 to $350,000, effective May 14, 2020, in connection with his promotion to the Chief Financial Officer role.

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EXECUTIVE COMPENSATION

In October 2020,2021, the Committee met to review the overall compensation of the named executive officers based on their positions and performance, and in relation to the compensation provided to

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EXECUTIVE COMPENSATION

At the beginning of 2021, our Chief Executive Officer proposed, and the Committee approved, our budget for 2021, including the Free Cash Flow and Bookings targets that would apply under our annual incentive plan. Free Cash Flow and Bookings, as set forth below, were chosen by the Committee as the relevant Company performance metrics for the 2021 annual cash incentive awards in an effort to focus management on improving free cash flow and bookings in a challenging industry environment. Performance below threshold would have resulted in zero payout for the applicable metric.

The final annual cash incentive payouts are determined using the following formula:

Interpolation is used for determining the Free Cash Flow and the Bookings Multiplier.

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EXECUTIVE COMPENSATION

2022 Awards. In February 2022, the Compensation Committee approved cash incentive compensation criteria under our 2017 Incentive Plan for the annual incentive awards to our executive officers for their performance in 20212022 (the “2021“2022 Bonus Criteria”). The 20212022 Bonus Criteria will differ from the 20202021 Bonus Criteria in the following key respects:

Mr. Bird’s target annual bonus remains at 100% of annual base salary and was reduced from 100%not increased in connection with his promotion to 75% of target bonus and the maximum payout was reduced from 200% to 150% of target bonus.Chief Executive Officer.

EXECUTIVE COMPENSATION

Restricted Stock Grants. The Committee is responsible for restricted stock grants under our 2017 Incentive Plan. The Committee approves the grant of restricted stock at meetings of the Committee, and generally does not grant restricted stock by written consent. The Committee establishes an award for our named executive officers and a total number of awards for non-executive employees and delegates to the Chief Executive Officer the distribution of such awards to our non-executive employees. Historically, our grants of equity compensation have been made on October 28, the anniversary of the closing of our initial public offering.

Based on the considerations discussed above under “— Long-Term Stock-Based Incentive Compensation,” the Committee awarded Mr. DeBerry with 58,675 shares of restricted stock, Mr. Bird with 27,242 shares of restricted stock, Mr. Kumar with 15,71642,480 shares of restricted stock and Mr. Webster with 18,86020,709 shares of restricted stock in October 2020. Messrs. Bird and Kumar were each also awarded 14,804 shares of restricted stock and 8,882 shares of restricted stock, respectively, in May 2020 in connection with their respective promotions.2021. These shares of restricted stock vested or are scheduled to vest in equal installments of one-third on October 28 of each of 2020, 20212022, 2023 and 2022,2024, subject to the officer’s continued employment through each applicable vesting date. As noted above, Messrs. DeBerry and Kumar were not granted shares of restricted stock in 2021.

Performance Units. The Committee also elected to grant to our named executive officersMessrs. Bird and Webster shares of performance units in October 20202021 under the 2017 Incentive Plan. The Committee believes that the performance unit awards align executive performance with stockholder interests and focus the officers on long-term performance as the performance units vest over three-year intervals. Under the plan, participants may earn from 0% to 200% of their target number of shares based upon the percentile ranking of the Company’s total shareholder return (“TSR”) compared to the TSR of the component companies of the Philadelphia Oil Service Index component companies and the S&P 500 Index, as set forth in the table below. The TSR is calculated over a 3-year period from October 1, 20202021 to September 30, 2023. Newly added for our 2020 performance units in order to promote further alignment with stockholder interests, in2024. In the event that the Company’s absolute TSR over the 3-year performance period is negative, a reduced percentage payout schedule is applied, as set forth below. Linear interpolation is used to determine payout for performance between achievement levels.

Based on the considerations discussed above under “— Long-Term Stock-Based Incentive Compensation,” the Committee awarded Mr. DeBerry with 58,675 performance units, Mr. Bird with 27,242 performance units, Mr. Kumar with 15,716a target grant of 42,480 performance units and Mr. Webster with 10,105a target grant of 20,709 performance units. As noted above, Messrs. BirdDeBerry and Kumar were each also awarded

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EXECUTIVE COMPENSATION

We seek to provide benefit plans, such as medical, life and disability insurance, in line with market conditions. Executive officers are eligible for the same benefit plans provided to other employees, including insurance plans and supplemental plans chosen and paid for by employees who wish additional coverage. We do not have any special insurance plans for executive officers.

Post-Employment Benefits

We typically make contributions to the Dril-Quip, Inc. 401(k) Plan, which is a voluntary and contributory defined contribution plan for eligible employees. Our contributions, which are based on a percentage of matching employee contributions, totaled approximately $1.5 million in 2020, which includes an aggregate of $34,486 for our named executive officers’ benefit. As part of our cost cutting efforts in response to the significant negative impact of the COVID-19 pandemic on both the Company’s industry and its financial performance, the Company suspended matching contributions to the 401(k) retirement accounts of all employees effective July 1, 2020.2020 and that suspension remained in effect throughout 2021.

EmploymentIndividual Agreements with Executive Officers

We have entered into employment agreements with each of Blake T. DeBerry, Chief Executive Officer, Jeffrey J. Bird, President — Chief Operating Officer, Raj Kumar, Vice President — Chief Financial Officer, and James C. Webster, Vice President — General Counsel and Secretary.Kyle F. McClure. In addition, Mr. DeBerry and the Company entered into a Separation and Release Agreement on September 1, 2021 in connection with Mr. DeBerry’s departure. For more information on these agreements, see “Executive Compensation — Potential Payments Upon Termination or Change-in-Control.”

Stock Ownership Guidelines

To align the interests of our executive officers and stockholders, we maintain the stock ownership guidelines described below for our executive officers and our non-employee directors.officers. Under the guidelines, our executives should own Dril-Quip common stock having a market value based on the following multiples of base salary:

For purposes of the guidelines, the ownership requirement is determined based on the executive’s current base salary. The base salary multiple amount is converted to a fixed number of shares using the average closing price of our common stock for the prior calendar year.

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EXECUTIVE COMPENSATION

Impact of Accounting and Tax Treatments

Accounting Treatment

Under ASC 718, we recognize the cost of employee services received in exchange for awards of equity instruments based on the grant date fair value of those awards. Restricted stock awards are measured based on the fair value of the stock at the date of grant. We have valued the performance unit awards using a Monte Carlo simulation model based on probable achievement level of the underlying performance conditions as of the grant date.

Tax Treatment

Section 162(m) of the U.S. Internal Revenue Code of 1986, as amended (the “Code”), generally disallows a tax deduction to public companies for compensation in excess of $1 million paid to the Chief Executive Officer and certain other executive officers (“covered employees”). However, for 2017 and prior years, any compensation paid to our Chief Executive Officer and covered employees that met the requirements of qualified performance-based compensation under Section 162(m) was not subject to this deduction limitation. Following the enactment of the Tax Cuts and Jobs Act, beginning with the 2018 calendar year, thereIt is no longer any exception for qualified performance-based compensation. However, it may be possible for performance awards that were outstanding as of November 2, 2017 to continue to qualify as qualified performance-based compensation for such purposes so long as the awards are not modified in any material respect after such date (and assuming that the awards otherwise satisfy any transition relief guidance issued by the Internal Revenue Service).

Without the performance-based compensation exception under Section 162(m) or the transition relief described above, it istherefore expected that any compensation deductions (other than grandfathered amounts) for our covered executives, including our named executive officers, will be subject to a $1 million annual deduction limitation. Although the deductibility of compensation is a consideration evaluated by the Committee, the Committee believes that the lost deduction on compensation payable in excess of the $1 million limitation for the named executive officers is not material relative to the benefit of being able to attract and retain talented management. Accordingly, the Committee continues to retain the discretion to pay compensation that is subject to the $1 million deductibility limit.

Stockholder Advisory “Say-on-Pay” Vote

At our 20212022 annual meeting, we are providing our stockholders with the opportunity to cast an advisory vote on the compensation of our named executive officers, commonly known as a “say-on-pay” vote. This vote provides our stockholders the opportunity to express their views regarding the compensation program for our named executive officers as disclosed in this proxy statement. As an advisory vote, the say-on-pay vote at our 20212022 annual meeting will not be binding

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Compensation Committee Report

The Compensation Committee of the Board has reviewed and discussed the Compensation Discussion and Analysis required by Item 402(b) of Regulation S-K with management. Based on such review and discussions, the Compensation Committee recommended to the Board that the Compensation Discussion and Analysis be included in this proxy statement.

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Summary Compensation Table

The following table sets forth information regarding the compensation of Mr. DeBerry, our Former Chief Executive Officer, Mr. Bird, our President and Chief Executive Officer (and former Chief Operating Officer,Officer), Mr. Kumar, our Former Vice President — Chief Financial Officer, and Mr. Webster, our Vice President — General Counsel and Secretary (collectively, the “named executive officers”), for services rendered in all capacities during 2018, 2019, 2020 and 2020:2021: