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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A INFORMATION

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:

          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 under §240.14a-12

Seagate Technology Holdings public limited company

 

 

(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 computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
  (1)         

Title of each class of securities to which transaction applies:

 

  (2)         

Aggregate number of securities to which transaction applies:

 

  (3)         

Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined):

 

  (4)         

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  Fee paid previously with preliminary materials.

  Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.
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Amount Previously Paid:

 

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  (4)  

Date Filed:

 


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LOGO

August 30, 2021

Dear Fellow Shareholder:

You are cordially invited to attend the 2021 Annual General Meeting of Shareholders of Seagate Technology Holdings plc, which will be held on Wednesday, October 20, 2021, at 5:00 p.m. Irish Standard Time at the InterContinental Hotel, Simmonscourt Road, Dublin 4, D04 A9K8, Ireland. Due to public health concerns and continuing uncertainty in connection with COVID-19, this year we also are offering you the opportunity to virtually join the Annual General Meeting via live webcast over the Internet at 5:00 p.m. Irish Standard Time (12:00 p.m. Eastern Daylight Time). You may virtually join the Annual General Meeting and vote and submit your questions during the meeting by visiting www.virtualshareholdermeeting.com/STX2021. In accordance with Irish law, we are required to have a principal meeting place, which is a physical location, where shareholders may attend the Annual General Meeting in person and vote. However, in light of continuing public health concerns and potential travel recommendations and restrictions, we strongly advise shareholders not to attend in person at the principal meeting place and ask that shareholders join the Annual General Meeting virtually instead. Your vote is important. We encourage shareholders to cast their votes in advance of the Annual General Meeting, whether they plan to attend in person or join virtually.

We continue to monitor COVID-19 developments and other circumstances. Should we determine that alternate Annual General Meeting arrangements may be advisable or required, such as changing the date, time and/or location of the Annual General Meeting, we will announce our decision by press release, post additional information at investors.seagate.com, and make a public filing with the U.S. Securities and Exchange Commission. Please monitor the “Events” tab of investors.seagate.com regularly, as circumstances may change upon short notice.

Details of the business to be presented at the meeting may be found in the Notice of 2021 Annual General Meeting of Shareholders and the Proxy Statement accompanying this letter. We urge you to read the Proxy Statement carefully and use one of the methods of voting described in the Proxy Statement to ensure that your shares will be voted at the 2021 Annual General Meeting.

On behalf of the Board of Directors of Seagate Technology Holdings plc, we thank you for your continued support.

Sincerely,

 

LOGO

 

 

 

LOGO

 

Michael R. Cannon

 

William D. Mosley

Board Chair   Chief Executive Officer and Director


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 2021 NOTICE OF MEETING AND PROXY STATEMENT

 

 

LOGO

SEAGATE TECHNOLOGY HOLDINGS PUBLIC LIMITED COMPANY

NOTICE OF 2021 ANNUAL GENERAL MEETING OF SHAREHOLDERS

The 2021 Annual General Meeting of Shareholders (the “2021 AGM”) of Seagate Technology Holdings plc (“Seagate” or the “Company”), a company incorporated under the laws of Ireland with its registered and principal executive offices at 38/39 Fitzwilliam Square, Dublin 2, D02 NX53, Ireland, will be held on Wednesday, October 20, 2021, at 5:00 p.m. Irish Standard Time, at the InterContinental Hotel, Simmonscourt Road, Dublin 4, D04 A9K8, Ireland. Due to public health concerns and continuing uncertainty in connection with COVID-19, this year we are also offering you the opportunity to join the 2021 AGM virtually via live webcast over the Internet. We encourage you to use this feature rather than attending the 2021 AGM in person. Those participating virtually can join, vote and submit questions via the Internet during the 2021 AGM by accessing www.virtualshareholdermeeting.com/STX2021. We encourage shareholders to cast their votes prior to the 2021 AGM by one of the methods described in the accompanying Proxy Statement to ensure that your shares will be voted at the 2021 AGM, even if you plan to attend in person or join virtually.

The Company is monitoring COVID-19 developments and other circumstances, as well as guidance issued by the Irish Health Service Executive (“HSE”), the Irish government, the U.S. Centers for Disease Control and Prevention, and the World Health Organization. We have implemented, and will continue to implement, the measures advised by the HSE to minimize the spread of COVID-19, including in respect of the 2021 AGM. Should we determine that alternative 2021 AGM arrangements may be advisable or required, such as changing the date, time and/or location of the 2021 AGM, we will announce our decision by press release, post additional information at investors.seagate.com, and make a public filing with the U.S. Securities and Exchange Commission (“SEC”); such notifications will be in accordance with Irish and other applicable laws, rules and regulations. Please monitor the “Events” tab of investors.seagate.com regularly, as circumstances may change upon short notice.

The purposes of the 2021 AGM, which are more completely described in the accompanying Proxy Statement, are:

General Proposals:

 

  1.

By separate resolutions, to elect as directors the following incumbent directors who shall retire in accordance with the Company’s Constitution and, being eligible, offer themselves for election (the “Director Nominees”):

 

(a) Mark W. Adams    (b) Shankar Arumugavelu    (c) Pratik (“Prat”) Bhatt
(d) Judy Bruner    (e) Michael R. Cannon    (f) Jay L. Geldmacher
(g) Dylan Haggart    (h) William D. Mosley    (i) Stephanie Tilenius
(j) Edward J. Zander      

Stephen J. Luczo will retire as a director and will not stand for re-election.

 

  2.

Approve, in an advisory, non-binding vote, the compensation of the Company’s named executive officers (“Say-on-Pay”).

  

 

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 2021 NOTICE OF MEETING AND PROXY STATEMENT

 

 

  3.

Ratify, in a non-binding vote, the appointment of Ernst & Young LLP as the independent auditors of the Company for the fiscal year ending July 1, 2022 (“fiscal year 2022”), and authorize, in a binding vote, the Audit and Finance Committee (“Audit and Finance Committee”) of the Company’s Board of Directors (the “Board”) to set the auditors’ remuneration.

 

  4.

To approve the Seagate Technology Holdings plc 2022 Equity Incentive Plan.

Other:

 

  5.

Conduct such other business properly brought before the meeting.

The Board recommends that you vote “FOR” each director nominee included in Proposal 1, and “FOR” each of Proposals 2 through 4. The full text of these proposals is set forth in the accompanying Proxy Statement.

All of the proposals are ordinary resolutions, requiring the approval of a simple majority of the votes cast at the meeting.

Only shareholders as of the close of business on August 25, 2021 (“Record Date”) are entitled to receive notice of and to vote at the 2021 AGM. If you are a shareholder as of the close of business on the Record Date, you may attend, speak and vote at the 2021 AGM or you may appoint a proxy or proxies to attend, speak and vote on your behalf. A proxy need not be a shareholder. If you wish to appoint as proxy any person other than the individuals specified on the proxy card, please contact the Company Secretary at our registered office or deliver to the Company Secretary a proxy card in the form set out in section 184 of the Irish Companies Act 2014 (the “Irish Companies Act”); please also note your nominated proxy must attend the 2021 AGM in Dublin in person in order for your votes to be cast.

Whether or not you plan to attend the meeting or join virtually, we encourage you to please read the accompanying Proxy Statement and submit your proxy as soon as possible, so that your shares may be represented at the 2021 AGM in Dublin. You may vote by proxy by using the Internet, calling by telephone, or completing, signing and returning your proxy card by mail by no later than 6:59 p.m. Eastern Daylight Time (11:59 p.m. Irish Standard Time) on October 19, 2021 (or, if you are a beneficial owner, such earlier time as your bank, broker-dealer, brokerage firm, or nominee may require). Instructions on how to submit your proxy are set forth in the accompanying Proxy Statement.

If you have any questions about the meeting or require assistance, please call Georgeson LLC, our proxy solicitor, at +1 781 575 2137 or at + 1 800 891 3214 (toll-free within the United States).

During the meeting, following a review of the Company’s affairs, management will also present Seagate’s Irish statutory financial statements for the fiscal year ended July 2, 2021 (“fiscal year 2021”) and the reports of the directors and auditors thereon.

By order of the Board,

 

 

LOGO

Katherine E. Schuelke

Senior Vice President, Chief Legal Officer and Company Secretary

August 30, 2021

  

 

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 2021 NOTICE OF MEETING AND PROXY STATEMENT

 

 

IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS

FOR THE ANNUAL GENERAL MEETING OF SHAREHOLDERS

TO BE HELD ON OCTOBER 20, 2021

We will rely on the SEC rule that allows companies to furnish proxy materials over the Internet instead of mailing printed copies of those materials to each shareholder. As a result, we are sending our shareholders a Notice of Internet Availability of Proxy Materials (the “Notice”) instead of a paper copy of our Proxy Statement, including our Irish statutory financial statements for fiscal year 2021 and any other appendices thereto, the proxy card and our Annual Report on Form 10-K for fiscal year 2021 (collectively, the “Proxy Materials”). The Notice also contains instructions on how to request a paper or email copy of the Proxy Materials. If you have previously elected to receive our Proxy Materials electronically, you will continue to receive these materials via email unless you elect otherwise. A full printed set of our Proxy Materials will be mailed to you automatically only if you have previously made a permanent election to receive our Proxy Materials in printed form.

  

 

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 2021 NOTICE OF MEETING AND PROXY STATEMENT

 

 

 

PROXY STATEMENT

 

 

In this Proxy Statement, “Seagate,” the “Company,” “we,” “us” and “our” refer to Seagate Technology Holdings plc, an Irish public limited company. This Proxy Statement and the enclosed proxy card, or the Notice of Internet Availability of Proxy Materials, are first being mailed on or about September 1, 2021 to shareholders as of the close of business on the Record Date.

SUMMARY INFORMATION

This summary highlights information contained elsewhere in this Proxy Statement. For more complete information about the topics summarized below, please review the entire Proxy Statement and Seagate’s Annual Report on Form 10-K for fiscal year 2021.

 

 

LOGO

2021 AGM

 

Date and Time:    Wednesday, October 20, 2021 at 5:00 p.m. Irish Standard Time
Place:   

InterContinental Hotel

Simmonscourt Road

Dublin 4, D04 A9K8, Ireland

Record Date:    August 25, 2021
Voting:    Shareholders as of the close of business on the Record Date may vote on the proxy proposals. Each ordinary share that you own entitles you to one vote on each matter to be voted on at the 2021 AGM. Your vote is very important. We encourage you to vote your shares prior to the 2021 AGM.
Attendance:    All shareholders as of the close of business on the Record Date may attend the 2021 AGM. If present in person, you may attend, speak and vote at the meeting even if you have completed and submitted a form of proxy. You or your nominated proxy must attend the 2021 AGM in person in Dublin in order for your votes to be cast. Shareholders as of the close of business on the Record Date may virtually join, vote and submit questions at the 2021 AGM on the Internet via live webcast at www.virtualshareholdermeeting.com/STX2021. Instructions on how to join, vote and submit questions at the meeting will be posted on that website. Participants joining virtually should ensure that they have a strong Wi-Fi connection at the location where they intend to be while

 

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virtually joining the 2021 AGM. Participants should also give themselves plenty of time to log in prior to the 2021 AGM. Participants intending to join virtually will need to demonstrate proof of share ownership by entering the 16-digit control number included on their notices, proxy cards or voting instruction forms received with their Notice or Proxy Materials.

 

We are monitoring guidance issued by the HSE, the Irish government, the U.S. Centers for Disease Control and Prevention, and the World Health Organization and we have implemented, and will continue to implement, the measures advised by the HSE to minimize the spread of COVID-19, including in respect of the 2021 AGM. In light of continuing public health concerns, and potential travel recommendations and restrictions, we strongly advise shareholders wishing to attend the 2021 AGM to virtually join instead of attending in person in Dublin. The meeting will be as brief as possible and, other than the shareholder business items outlined in the Proxy Materials, will not include presentations. Also, in order to comply with any suggested COVID-19 social distancing guidelines in place at the time of the 2021 AGM, we may limit the number of shareholders who may attend the meeting in person, and will require compliance with any then applicable governmental requirements or recommendations or facility requirements, such as the use of face coverings and maintaining appropriate social distancing.

Proxy Materials:   

The Proxy Materials were first made available to shareholders on or about

September 1, 2021.

 

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Proposals, Voting Recommendations and Vote Required

The Board recommends that you vote “FOR” each of the proposals that will be submitted for shareholder approval at the 2021 AGM.

 

 Proposals:   Vote Required:    Board Recommendation:
 1.    Election of each of the 10 Director Nominees    Majority of Votes Cast    FOR each nominee
   We are asking our shareholders to elect, by separate resolutions, each of the Director Nominees identified in the Proxy Statement.     
 2.    Advisory Vote on Say-on-Pay    Majority of Votes Cast    FOR
   We are asking for your approval, on an advisory, non-binding basis, of the compensation of our named executive officers (“NEOs”). While our Board intends to carefully consider the shareholder vote resulting from the proposal, the final vote is advisory and will not be binding on us.     
 3.    Ratification of the Appointment and Authorization to Set Remuneration of Auditors    Majority of Votes Cast    FOR
   We are asking for your ratification, in a nonbinding vote, of the appointment of Ernst & Young LLP as our independent auditors for fiscal year 2022, and to authorize, in a binding vote, the Audit and Finance Committee of the Board to set the auditors’ remuneration.     
 4    To approve the Seagate Technology Holdings plc 2022 Equity Incentive Plan    Majority of Votes Cast    FOR
   We are asking for your approval of the 2022 Equity Incentive Plan that would replace our existing 2012 Equity Incentive Plan and govern the grant of share-based awards to our employees, directors and consultants.     

During the meeting, following a review of Seagate’s affairs, management will also present Seagate’s Irish statutory financial statements for fiscal year 2021 and the reports of the directors and statutory auditors thereon.

 

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Seagate’s Corporate Governance Highlights

 

•  The Board consists of a substantial majority (82% as of end of fiscal year 2021) of independent directors.

 

  

•  The Board Chair is an independent director.

•  Directors must receive a majority of shareholder votes cast to be elected.

 

  

•  All directors are elected annually by shareholders.

•  All Board committees are composed exclusively of independent directors.

 

  

•  The independent directors meet regularly in executive sessions.

•  Directors and executive officers are subject to share ownership requirements.

 

  

•  Executive officers are subject to a “clawback” policy.

•  The Board and each Board committee perform periodic self-evaluations.

 

  

•  The Board oversees the Company’s enterprise risk management program including ESG-related risks.

•  The Board oversees succession planning for all executive officers, including the Chief Executive Officer, and also undertakes succession planning for members of the Board.

 

  

•  The Company maintains an anti-hedging policy for all directors and employees.

•  The Company maintains a policy prohibiting the pledging of Company securities by directors, executive officers and certain other employees.

  

2022 Annual General Meeting of Shareholders

 

  Deadline for shareholder proposals for inclusion in the Proxy Statement:

   May 4, 2022

  Period for shareholder nomination of directors:

   April 4, 2022 to May 4, 2022

  Deadline for all other proposals:

   July 18, 2022

For further information, see the section entitled “Shareholder Proposals and Nominations” on page 86 of this Proxy Statement.

 

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TABLE OF CONTENTS

 

GENERAL INFORMATION

     1  

PROPOSALS REQUIRING YOUR VOTE

     6  

PROPOSALS 1(a) – 1(j) – ELECTION OF DIRECTORS

     6  

CORPORATE GOVERNANCE

     14  

COMPENSATION OF DIRECTORS

     23  

PROPOSAL 2 – AN ADVISORY, NON-BINDING VOTE ON THE COMPANY’S EXECUTIVE COMPENSATION – SAY-ON- PAY VOTE

     27  

COMPENSATION DISCUSSION AND ANALYSIS

     28  

Fiscal Year 2021 Company Highlights

     28  

Executive Summary

     29  

Fiscal Year 2021 Executive Compensation Highlights

     29  

Our Executive Compensation Strategy

     30  

Our Fiscal Year 2021 Executive Compensation Programs

     31  

Role of Our Compensation Committee

     31  

Role of the Compensation Consultant

     32  

Role of our CEO and Management in the Compensation Process

     32  

Fiscal Year 2020 Shareholder Advisory Vote Results

     33  

Executive Market Comparison Peer Group and Benchmark Philosophy

     33  

How We Determine Individual Compensation Amounts for the NEOs

     34  

Annual Base Salary

     37  

Annual Incentive Plan – Executive Officer Performance Bonus

     37  

Long-Term Equity Incentives

     39  

Share Ownership Requirements

     43  

Benefits and Perquisites

     43  

Non-Qualified Deferred Compensation Plan

     43  

Long Term International (Expatriate) Assignment Policy

     44  

Severance and Change in Control Benefits

     45  

Other Company Policies and Compensation Considerations

     46  

Compensation Committee Report

     47  

Compensation Committee Interlocks and Insider Participation

     47  

COMPENSATION OF NAMED EXECUTIVE OFFICERS

     48  

Summary Compensation Table for Fiscal Year 2021

     48  

All Other Compensation for Fiscal Year 2021

     49  

Grants of Plan-Based Awards Table for Fiscal Year 2021

     50  

Outstanding Equity Awards at 2021 Fiscal Year-End

     52  

Option Exercises and Shares Vested for Fiscal Year 2021

     54  

Non-qualified Deferred Compensation Plans

     55  

Potential Payments Upon Qualifying Termination or Change in Control

     55  

CHIEF EXECUTIVE OFFICER PAY RATIO

     61  

PROPOSAL 3 – A NON-BINDING RATIFICATION OF THE APPOINTMENT OF ERNST & YOUNG LLP FOR THE FISCAL YEAR ENDING JULY 1, 2022 AND BINDING AUTHORIZATION OF AUDIT AND FINANCE COMMITTEE TO SET AUDITORS’ REMUNERATION

     62  

Audit and Finance Committee Report

     63  

Fees to Independent Auditors

     64  

Pre-Approval of Services by Independent Auditors

     64  

PROPOSAL 4 – TO APPROVE THE SEAGATE TECHNOLOGY HOLDINGS PLC 2022 EQUITY INCENTIVE PLAN

     66  

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

     80  

 

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EQUITY COMPENSATION PLAN INFORMATION

     83  

DELINQUENT SECTION 16(A) BENEFICIAL OWNERSHIP REPORTS

     84  

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

     85  

SHAREHOLDER PROPOSALS AND NOMINATIONS

     86  

DISCLOSURE OF INTERESTS

     87  

INCORPORATION BY REFERENCE

     87  

ANNUAL REPORT

     87  

HOUSEHOLDING

     88  

APPENDIX A: DIRECTOR’S REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 2 JULY 2021

     A-1  

APPENDIX B: SEAGATE TECHNOLOGY HOLDINGS PLC 2022 EQUITY INCENTIVE PLAN

     B-1  

Cautionary Statement Regarding Forward-Looking Statements

This Proxy Statement may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements provide current expectations of future events based on certain assumptions and include any statement that does not directly relate to any historical fact. Forward-looking statements generally can be identified by words such as “expects,” “intends,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” “projects,” “should,” “may,” “will,” “will continue,” “can,” “could” or the negative of these words, variations of these words and comparable terminology, in each case, intended to refer to future events or circumstances. However, the absence of these words or similar expressions does not mean that a statement is not forward-looking. Forward-looking statements are subject to various uncertainties and risks that could cause our actual results to differ materially from historical experience and our present expectations or projections. These risks and uncertainties include, but are not limited to, those described under the captions “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the Company’s Annual Report on Form 10-K for fiscal year 2021 and in our Quarterly Reports on Form 10-Q filed with the SEC. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof and are based upon information available to us at this time. The Company undertakes no obligation to update forward-looking statements to reflect events or circumstances after the date they were made, unless required by applicable law.

 

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 2021 NOTICE OF MEETING AND PROXY STATEMENT

 

 

LOGO

GENERAL INFORMATION

The following are questions and answers concerning voting and solicitation and other general information. You should read this entire Proxy Statement carefully.

 

Why did I receive this Proxy Statement?

   We sent you this Proxy Statement or a Notice of Internet Availability of Proxy Materials (the “Notice”) on or around September 1, 2021 because our Board of Directors (the “Board”) is soliciting your proxy to vote at the Company’s 2021 Annual General Meeting of Shareholders (“2021 AGM”). This Proxy Statement summarizes the information you need to know to vote on an informed basis. If you have received a Notice, it contains a control number that will allow you to access the Notice, our Proxy Statement, including our Irish statutory financial statements for fiscal year 2021, the proxy card and our Annual Report on Form 10-K for fiscal year 2021 (collectively, the “Proxy Materials”) online.

Why are there two sets of financial statements covering the same fiscal period?

   U.S. securities laws require us to send you our Annual Report on Form 10-K for fiscal year 2021, which includes our financial statements prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”). These financial statements are included in the mailing of this Proxy Statement. Irish law requires us to provide you with our Irish statutory financial statements for fiscal year 2021, including the reports of our directors and statutory auditors thereon. The Irish statutory financial statements are included as Appendix A to this Proxy Statement, are available online at www.proxyvote.com, and, as required under Irish law, will be available at the 2021 AGM in Dublin.

What do I need to do to attend the 2021 AGM?

   All shareholders of record (“record holders”) and beneficial owners (i.e., those whose shares are held via a bank, broker-dealer, brokerage firm, trust or other similar organization or other nominee record holder (each referred to herein as a “broker”)) as of the close of business on the Record Date may attend the 2021 AGM in person or join virtually via live webcast at www.virtualshareholdermeeting.com/STX2021. We encourage you to vote your shares prior to the 2021 AGM. In light of continuing public health concerns, and potential travel recommendations and restrictions, we strongly advise shareholders wishing to attend the 2021 AGM to join virtually instead of attending in person in Dublin. The meeting will be as brief as possible and, other than the shareholder business items outlined in the Proxy Materials, will not include presentations. Also, in order to comply with any suggested COVID-19 social distancing guidelines in place at the time of the 2021 AGM, we may limit the number of shareholders who may attend the meeting in person, and will require compliance with any then applicable governmental requirements or recommendations or facility requirements, such as the use of face coverings and maintaining appropriate social distancing.

 

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To attend the 2021 AGM in person, if you are a record holder, you must present valid photo identification, such as a driver’s license or passport, matching that of a shareholder appearing on the Company’s register as of close of business on the Record Date and a copy of a share certificate or other evidence of share ownership. If you are a beneficial owner, in addition to the foregoing, you also must present a letter from your broker showing that you were the beneficial owner of the shares as of the close of business on the Record Date together with a legal proxy from your broker entitling you to vote your shares in person at the 2021 AGM.

 

To attend, vote and submit questions at the 2021 AGM virtually, visit www.virtualshareholdermeeting.com/STX2021 and enter the 16-digit control number included on your Notice, proxy card or in the instructions that accompanied your Proxy Materials. You may also submit questions in advance of the 2021 AGM at www.proxyvote.com.

 

The webcast website, www.virtualshareholdermeeting.com/STX2021, is supported on browsers (e.g., Internet Explorer, Firefox, Chrome and Safari) and devices (desktops, laptops, tablets and cell phones) running the most updated version of applicable software and plugins. Participants joining virtually should ensure that they have a strong Wi-Fi connection at wherever they intend to be during the 2021 AGM. Online check-in will be available approximately 5-15 minutes prior to the meeting. Additional information regarding the rules and procedures for participating in the 2021 AGM will be set forth in our meeting rules of conduct, which you can view during the 2021 AGM on www.virtualshareholdermeeting.com/STX2021.

 

Anyone who has technical difficulties accessing or using the website during the 2021 AGM should call the technical support number shown on the www.virtualshareholdermeeting.com/STX2021 website.

Who may vote?

   You may vote if you are a shareholder of our ordinary shares at the close of business on the Record Date. As of the Record Date, there were 225,972,455 ordinary shares outstanding and entitled to vote.

 

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How do I vote?

  

We encourage you to vote your shares in advance by submitting your proxy or following the instructions provided by your broker, even if you plan to attend the 2021 AGM in person in Dublin.

 

Record Holders

If you are the record holder, meaning that you own your shares in your own name and not through a broker, you may vote in one of four ways:

 

LOGO

  

•  Via the Internet. To vote using the Internet go to www.proxyvote.com and use the control number you were provided on your proxy card or Notice. You will need to follow the instructions on the website.

 

LOGO

  

•  By Telephone. To vote via telephone, call +1.800.690.6903 and follow the telephone prompts.

 

LOGO

  

•  By Mail. If you received a paper copy of the Proxy Materials in the mail, a printed proxy card has been enclosed. You may mark, sign, date and mail your proxy card to the address indicated on the proxy card, which will then be forwarded to Seagate’s registered office in Ireland electronically. If you have not received a paper copy of our Proxy Materials and wish to vote by mail, please follow the instructions included in the Notice to obtain a paper proxy card. A full printed set of our Proxy Materials will be mailed to you automatically only if you have previously made a permanent election to receive our Proxy Materials in printed form.

 

LOGO

  

•  In Person. Attend the 2021 AGM in person in Dublin, Ireland, virtually, or by appointing one or more proxies (who do not have to be shareholders) to attend the 2021 AGM in person and cast votes on your behalf in accordance with your instructions. If you wish to appoint as your proxy any person other than the individuals specified in the proxy card, please contact the Company Secretary at our registered office. If you attend virtually, you will not be able to speak at the 2021 AGM but you can vote during the meeting at www.virtualshareholdermeeting.com/STX2021. Once the 2021 AGM has formally opened, the chair of the 2021 AGM will explain that voting will take place by poll and will outline the voting procedure. For information on how to attend the 2021 AGM in person or join virtually, please see “What do I need to do to attend the 2021 AGM?” above.

  

Beneficial owners

Beneficial owners must vote their shares in the manner prescribed by their broker. If you do not receive voting instructions, please contact your broker directly. As noted above, beneficial owners wishing to vote in person at the 2021 AGM will need to obtain a legal proxy from their broker and bring it with them to the 2021 AGM. For information on how to attend the 2021 AGM in person, please see “What do I need to do to attend the 2021 AGM?” above.

   In order to be timely processed, your proxy must be received by 6:59 p.m. Eastern Time (11:59 p.m. local time in Ireland) on October 19, 2021 (or, if you are a beneficial owner, such earlier time as your broker may require).

 

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May I revoke my proxy?

  

If you are a record holder of the Company’s shares you may change or revoke your proxy at any time before it is voted at the 2021 AGM by:

•  notifying the Company Secretary in writing: c/o Seagate Technology Holdings plc at 38/39 Fitzwilliam Square, Dublin 2, D02 NX53, Ireland, Attention: Company Secretary;

•  submitting another properly signed proxy card (in the form mailed to you or in the form set out in section 184 of the Irish Companies Act) with a later date or another Internet or telephone proxy at a later date but prior to the voting deadline described above; or

•  by voting in person at the 2021 AGM in Dublin.

   Merely attending the 2021 AGM in person does not revoke your proxy. To revoke a proxy, you must take one of the actions described above.
  

For beneficial owners, you must contact your broker to revoke your proxy. If you are a beneficial owner, merely attending or attempting to vote in person at the 2021 AGM in Dublin will not revoke your proxy.

 

See “What do I need to do to attend the 2021 AGM?” above for information on how to attend the 2021 AGM.

How will my proxy get voted?

   If your proxy is properly submitted, you are legally designating the person or persons named on the proxy card to vote your shares as you have directed. Unless you name a different person or persons to act as your proxy, Michael R. Cannon and/or Katherine E. Schuelke (the “Company Designees”) or their substitutes will act as your proxies. If you sign and return your proxy without indicating how your shares are to be voted and name anyone other than a Company Designee as your proxy, that person may vote your shares at their discretion. If you name a Company Designee as your proxy without indicating how your shares are to be voted, the Company Designee will vote your shares as the Board recommends on each proposal in this Proxy Statement and at their discretion regarding any other matter properly presented for a vote at the 2021 AGM. The Board currently does not know of any matters to be raised at the 2021 AGM other than the proposals contained in this Proxy Statement.
   If you are a beneficial owner, your broker may vote your shares at their discretion on “routine” matters if your broker does not receive instructions from you.
  

The following proposals are routine matters:

•   Proposal 3 (Ratification of the Appointment and Authorization to Set Remuneration of Auditors)

 

However, your broker may not vote your shares on “non-routine” matters if your broker does not receive instructions from you (“broker non-votes”). Broker non-votes will be counted for the purposes of a quorum, but will not be counted as votes for or against the non-routine matters, but rather will be regarded as votes withheld and will not be counted in the calculation of votes for or against the resolution.

 

The following proposals are non-routine matters:

•   Proposal 1 (Election of each of the 10 Director Nominees)

•   Proposal 2 (Advisory Vote on Say-on-Pay)

•   Proposal 4 (Approve the Seagate Technology Holdings plc 2022 Equity Incentive Plan)

 

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What constitutes a quorum?

   A quorum is the minimum number of shares required to be present at the 2021 AGM to properly hold an annual meeting and conduct business. The presence at the meeting in Dublin (in person or by proxy) of shareholders entitled, as of the Record Date, to exercise a majority of the voting power of the Company is necessary to constitute a quorum to conduct business at the 2021 AGM. Abstentions and broker non-votes are treated as “shares present” for the purposes of determining whether a quorum exists.

What vote is required to approve each of the proposals?

   Each of the proposals is an ordinary resolution, requiring the approval of a simple majority of the votes cast at the meeting.
   Although, as noted above, abstentions and broker non-votes are counted as “shares present” at the 2021 AGM for the purpose of determining whether a quorum exists, they are not counted as votes cast either “for” or “against” the proposal and, accordingly, do not affect the outcome of the vote.

Who pays the expenses of this Proxy Statement?

   We have engaged Georgeson LLC (“Georgeson”) to assist in the distribution of the Proxy Materials and the solicitation of proxies. We expect to pay Georgeson a fee for these services estimated at $10,000 plus out-of-pocket expenses. Proxies will be solicited on behalf of our Board by mail, in person, by telephone and via the Internet. We will bear the cost of soliciting proxies. We will also reimburse brokers for their reasonable out-of-pocket expenses for forwarding Proxy Materials to the beneficial owners for whom they hold shares.

How will proxy holders vote on any other matters that may be presented at the 2021 AGM?

   Although we do not know of any matters to be presented or acted upon at the 2021 AGM other than the items described in this Proxy Statement, if any other matter is proposed and properly and validly presented at the 2021 AGM, the proxy holders will vote on such matters at their discretion.

How does the Board recommend that I vote?

   The Board recommends that you vote your shares “FOR” each of proposals in this Proxy Statement.

Voting procedures and tabulation.

   The Board has appointed a member of the Company’s Legal Department to serve as inspector of elections at the 2021 AGM and to make a written report thereof. Prior to the 2021 AGM, the inspector will sign an oath to perform their duties in an impartial manner and according to the best of their ability. The inspector will ascertain the number of ordinary shares outstanding, determine the number of ordinary shares present and represented at the 2021 AGM and the validity of proxies and ballots, count all votes and ballots, and perform certain other duties. The determination of the inspector as to the validity of proxies will be final and binding.

 

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PROPOSALS REQUIRING YOUR VOTE

PROPOSALS 1(a) – 1(j) — ELECTION OF DIRECTORS

(Ordinary Resolutions)

The Company uses a majority of votes cast standard for the election of directors. A majority of the votes cast means that the number of votes cast “for” a director nominee must exceed the number of votes cast “against” that director nominee. The Board currently has 11 directors, but Stephen J. Luczo will not be standing for re-election when his current term expires at the 2021 AGM. The Board has voted to reduce its size from 11 to 10 members effective as of October 20, 2021 and, accordingly, the number of directors will be set at 10 in accordance with our Constitution. Each of the Director Nominees listed below is being nominated to hold office for a one-year term beginning at the end of the 2021 AGM to be held on October 20, 2021 and expiring at the end of the 2022 Annual General Meeting of Shareholders (the “2022 AGM”).

After many years of distinguished service, Stephen J. Luczo will be retiring from the Board on October 20, 2021, at the expiration of his current term. We appreciate Mr. Luczo’s years of service as an executive and Director and thank him for his valuable guidance during his tenure with the Company. Additionally, we want to acknowledge Director William Coleman, who served this Board of Directors with distinction until his death at the end of last year. We miss his counsel and friendship.

Under our Constitution, if a director is not re-elected in a director election, then that director will not be re-appointed and the position on the Board that would have been elected or filled by the director nominee will become vacant, except in limited circumstances. The Board has the ability to fill the vacancy in accordance with the Constitution, subject to approval by the Company’s shareholders at the next annual general meeting of shareholders.

Notwithstanding the requirement that a director nominee requires a majority of the votes cast, as Irish law requires a minimum of two directors at all times, in the event that an election results in either only one or no directors receiving the required majority vote, either the nominee or each of the two nominees, as appropriate, receiving the greatest number of votes in favor of their election shall, in accordance with the Company’s Constitution, hold office until their successor shall be elected.

All of the Director Nominees are current Board members. The Nominating and Corporate Governance Committee reviewed the performance and qualifications of the directors listed below and recommended to the Board, and the Board approved, that each be recommended to shareholders for re-election at the 2021 AGM to serve for an additional one-year term. All of the Director Nominees have indicated that they will be willing and able to serve as directors.

 

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The following table sets forth the names, ages, and certain other information for each of the Director Nominees as of August 30, 2021. Full biographical information is below.

 

    Name of Director Nominee                   Age      

Director

     Since     

   Independent    Audit and
Finance
Committee
   Compensation
Committee
   Nominating and
Corporate Governance  
Committee

    Mark W. Adams

   57    2017          LOGO   

    Shankar Arumugavelu

   50    2021            

    Prat Bhatt

   54    2020       LOGO        

    Judy Bruner

   62    2018       LOGO   LOGO      

    Michael R. Cannon

   68    2011            

    Jay L. Geldmacher

   65    2012            

    Dylan Haggart

   34    2018            

    William D. Mosley

   55    2017            

    Stephanie Tilenius

   54    2014       LOGO        

    Edward J. Zander

   74    2009             LOGO

 

LOGO

Committee Chair

 

LOGO

Audit Committee Financial Expert

 

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THE BOARD RECOMMENDS THAT YOU VOTE “FOR” EACH OF THE FOLLOWING DIRECTOR NOMINEES:

 

(a)   Mark W. Adams—age 57,
Director since 2017

LOGO

  

Mr. Adams has served as the President and Chief Executive Officer (“CEO”) and a member of the board of directors of Smart Global Holdings, Inc., a specialty memory, storage and hybrid solutions company, since August 31, 2020. He served as the CEO of Lumileds, Inc., a lighting solutions company, from February 2017 until March 2019, and remains in an advisory role to the company. Mr. Adams served as President of Micron Technology, Inc., a semiconductor company, from February 2012 to February 2016. From 2006 to February 2012, Mr. Adams served in positions of increasing responsibility at Micron, including Vice President of Worldwide Sales and Vice President of Digital Media. Prior to joining Micron, Mr. Adams served as Chief Operating Officer (“COO”) of Lexar Media, Inc., a memory chip maker, in 2006. He served as Vice President of Sales and Marketing of Creative Labs, Inc., a digital entertainment products company, from 2002 to 2006. He held numerous roles at Creative Labs prior to 2002 including five years as General Manager of Latin America. Prior to Creative Labs, Mr. Adams spent five years in major account sales at NCR Corporation, an omni-channel technology solutions company, in their enterprise server business. Mr. Adams has served on the board of directors of Cadence Design Systems, Inc., since 2015. He also served on the board of Whistle Sports, Inc. from 2014 to 2021. Within the past five years, he served on the boards of directors of Lumileds, Inc. and of Aptina Inc.

 

Expertise: Mr. Adams brings financial, international, business development, sales and marketing, technological and operational expertise to our Board through his service as a senior level executive with several large multi-national corporations. In addition, his service on other public company boards brings valuable experience to our Board.

(b)   Shankar Arumugavelu—age 50,
Director since 2021

LOGO

  

Mr. Arumugavelu has served as the Senior Vice President and Group Chief Information Officer at Verizon Communications Inc. (“Verizon”), a multinational telecommunications company, leading Verizon’s technology organization, since October 2017. From February 2008 to October 2017, Mr. Arumugavelu served as Senior Vice President and Chief Information Officer for Verizon Wireless and Verizon Consumer Markets business units, and from October 2005 to December 2007 as Senior Vice President of Verizon Telecom. Since joining Verizon in 2002 through October 2005 Mr. Arumugavelu served in varying leadership roles of increasing responsibilities until his promotion to Senior Vice President.

 

Expertise: Mr. Arumugavelu brings substantial technology, strategy, global operations, cybersecurity, information systems and infrastructure expertise to our Board though his experience as a senior level executive in a large multi-national telecommunications corporation.    

 

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(c)    Prat Bhatt—age 54,
Director since 2020

 

LOGO

  

Mr. Bhatt has served as the Senior Vice President, Chief Accounting Officer at Cisco Systems, Inc. (“Cisco”), a global technology company, since April 2013, and also held the title Corporate Controller from April 2013 to May 2021. From July 2009 to April 2013 he served as Vice President, Chief Accounting Officer and Corporate Controller at Cisco, from June 2007 to July 2009 he served as Vice President, Finance and Assistant Corporate Controller, and from November 2000 to June 2007 Mr. Bhatt served in various leadership roles of increasing importance at Cisco. From June 1999 to November 2000 Mr. Bhatt was Director of Financial Operations at Kaiser Permanente and from October 1990 to June 1999 was Senior Manager with Ernst & Young. He is a licensed Certified Public Accountant.

 

Expertise: Mr. Bhatt brings substantial accounting, financial, global operations, strategy, enterprise risk management, and investor relations expertise to our Board through his experience as a senior level executive in a large multi-national technology corporation.

(d)   Judy Bruner—age 62,
Director since 2018

LOGO

  

Ms. Bruner served as the Executive Vice President of Administration and Chief Financial Officer of SanDisk Corporation, a supplier of flash storage products, from June 2004 to May 2016 and served on the SanDisk Corporation board of directors from June 2002 to July 2004. She also served as the Senior Vice President and Chief Financial Officer of Palm, Inc., an electronics company, from September 1999 to June 2004. Prior to Palm, Ms. Bruner held financial management positions at 3Com Corporation, a digital electronics manufacturer, and Hewlett Packard Corporation, an information technology company. Ms. Bruner has been a member of the board of directors of Applied Materials, Inc. since July 2016, Qorvo, Inc. since May 2021, and Rapid7, Inc. since October 2016. Within the past five years, Ms. Bruner has also served on the board of directors of Varian Medical Systems and Brocade Communications Systems, Inc.

 

Expertise: Ms. Bruner brings over 35 years of financial management and operational experience in the global high-tech industry, including in solid state storage devices, and extensive experience with strategy, investor relations, compliance and enterprise risk management. In addition, her service on other public company boards, including as chair of the audit committee, brings valuable experience to our Board.

 

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(e)   Michael R. Cannon—age 68,
Director since 2011

 

LOGO

  

Mr. Cannon has served as our Board Chair since July 2020. He served as President, Global Operations of Dell Inc., a multinational computer technology company, from February 2007 until January 2009, and as consultant to Dell Inc. from January 2009 until January 2011. He was the President and CEO of Solectron Corp., an electronic manufacturing services company, from January 2003 until February 2007. From July 1996 until January 2003, Mr. Cannon served as the CEO of Maxtor Corporation, a disk drive and storage systems manufacturer. He served on Maxtor’s board of directors from July 1996 until Seagate acquired Maxtor in May 2006. Prior to joining Maxtor, Mr. Cannon held senior management positions at IBM, a multinational technology company, and earlier was the Vice President of Asia Operations residing in Singapore, for the disk drive division of Control Data Corporation, a mainframe and supercomputer firm. Mr. Cannon began his career at The Boeing Company, an aerospace company, in engineering and management positions. He has served on the board of directors of Lam Research Corporation since February 2011, and on the board of directors of Dialog Semiconductor plc since February 2013. Mr. Cannon has previously served on the board of directors of Elster Group SE and within the past five years, on the board of directors of Adobe Systems, Inc.

 

Expertise: Mr. Cannon has extensive relevant industry expertise, including expertise in the disk drive business as well as with our major customers, that is valuable to our Board. Mr. Cannon brings international, technological, operations, leadership, and research and development expertise to our Board through his service as a public company CEO, and as a member of other public company boards of directors.

(f)    Jay L. Geldmacher—age 65,
Director since 2012

 

LOGO

  

Mr. Geldmacher has served as president and CEO and a member of the board of directors of Resideo Technologies, Inc. since May 2020. Resideo is a global provider of smart home solutions providing safety, security and comfort, and is a global distributor of security and fire products. Mr. Geldmacher served as Global CEO and President of Electro Rent Corporation, a Platinum Equity company from September 2019 to May 2020. From November 2013 to August 2019, Mr. Geldmacher served as President and CEO of Artesyn Embedded Technologies, a spin off of Emerson Network Power’s Embedded Computing & Power business. Artesyn was owned by Platinum Equity, a private equity firm, which acquired a majority interest in that company through a joint venture with Emerson in November 2013. Between 2007 and 2013, Mr. Geldmacher served as Executive Vice President of Emerson Electric Company and President of Emerson Network Power’s Embedded Computing & Power Group, which designs, manufactures and distributes embedded computing and embedded power products, systems and solutions. From 2006 to 2007, he served as Group Vice President and President of Emerson Network Power’s Embedded Computing & Power Group. From 1998 to 2006, he served as President of Astec Power Solutions, an Emerson subsidiary. Within the past five years, Mr. Geldmacher has served on the board of directors of Verra Mobility and as an Executive Advisory Council Member for Vertiv.

 

Expertise: As a CEO, Mr. Geldmacher brings international, technological, and operational expertise to our Board, along with additional board experience from his service on public company boards.

 

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(g)    Dylan G. Haggart—age 34,
Director since 2018

 

 

LOGO

  

Mr. Haggart has served as a General Partner at ValueAct Capital, a governance-oriented investment firm that invests in a concentrated portfolio of public companies, including Seagate, and has worked collaboratively with management and boards of directors on matters such as strategy, capital structure, mergers and acquisitions, and talent management since July 2013. Mr. Haggart also served as a board observer of Seagate from September 2016 until he was elected to serve as a director in January 2018. Prior to joining ValueAct Capital in 2013, Mr. Haggart served as a private equity investor at TPG Capital, an investment company, focusing on North American buyouts, and as an investment banker at Goldman Sachs, an investment banking firm.

 

Expertise: Mr. Haggart brings experience as an investor involved in strategic planning for other public and private companies. He also brings substantial experience with complex financial markets issues, capital allocation, strategy, technology, matters of corporate governance, executive compensation, and talent management. In addition, as a Partner and stockholder with ValueAct Capital, he has a deep knowledge of Seagate’s business and the markets it serves.

(h)   William D. Mosley—age 55,
Director since 2017

 

 

LOGO

  

Dr. Mosley has served as our CEO since October 2017 and as a member of the Board since July 25, 2017. He was previously our President and COO from June 2016 to September 2017. He also served as our President, Operations and Technology from October 2013 until June 2016 and as our Executive Vice President of Operations from March 2011 until October 2013. Prior to these positions, Dr. Mosley served as our Executive Vice President of Global Sales and Marketing from February 2009 through March 2011; Senior Vice President of Global Disk Storage Operations from 2007 to 2009; and Vice President of Research and Development, Engineering from 2002 to 2007. He joined Seagate in 1996 as a Senior Engineer with a PhD in solid state physics, and from 1996 to 2002, Dr. Mosley served at Seagate in varying roles of increasing responsibility until his promotion to Vice President.

 

Expertise: As our CEO, Dr. Mosley brings broad-based executive-level experience and in-depth understanding of the various aspects of our business. Dr. Mosley also brings valuable global operational, technological, research and development, and sales and marketing expertise to our Board.

 

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(i)  Stephanie Tilenius—age 54,
Director since 2014

 

 

LOGO

  

Ms. Tilenius is a founder and CEO of Vida Health, Inc., a mobile continuous care platform for preventing, managing and overcoming chronic and mental health conditions deployed at Fortune 500 companies, large U.S. payers and healthcare providers, since January 2014. Ms. Tilenius was an Executive in Residence at Kleiner Perkins Caufield & Byers, a venture capital firm, from June 2012 until October 2014, primarily focusing on companies within its Digital Growth Fund. From February 2010 until June 2012, Ms. Tilenius was Vice President of Global Commerce and Payments at Google, Inc., a multinational technology company, where she oversaw digital commerce, product search and payments. Prior to joining Google, Inc., she served in various positions at eBay Inc., an e-commerce company, from March 2001 until October 2009, ultimately as Senior Vice President of eBay.com and Global Products. She currently serves on the board of directors of ContextLogic and Wish, and within the past five years, served on the board of directors of Tradesy, Coach Inc., Redbubble Limited and served as the Chair of the Advisory Board of the Harvard Business School California Research Center.

 

Expertise: Ms. Tilenius is an experienced senior executive in the consumer internet sector. She contributes her leadership, strategic insight, digital and e-commerce expertise, and her experience as a company founder, to our Board, along with experience as a board member for other public and private companies.

(j)  Edward J. Zander—age 74,
Director since 2009

 

 

LOGO

  

Mr. Zander served as Chairperson and CEO of Motorola, Inc., a multinational telecommunications company, from January 2004 until January 2008, when he retired as CEO, and continued as Chairperson until May 2008. Prior to joining Motorola, Mr. Zander was a Managing Director of Silver Lake Partners, a private equity fund focused on investments in technology industries, from July 2003 to December 2003. Mr. Zander was President and COO of Sun Microsystems Inc., an information technology company, from October 1987 until June 2002. Within the past five years, Mr. Zander has served as a member of the board of directors of NetSuite, Inc.

 

Expertise: Mr. Zander brings to our Board financial, technological, sales and marketing, and research and development expertise from his career as a senior executive of technology companies, and financial expertise from his prior private equity experience. His service on other public and private company boards also brings valuable experience to our Board.

There are no familial relationships between any of the Director Nominees or our executive officers, nor are any of our directors, Director Nominees or executive officers party to any legal proceedings adverse to us.

 

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DIRECTOR NOMINEES SNAPSHOT

 

 

LOGO

 

 

LOGO

 

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CORPORATE GOVERNANCE

Corporate Governance Guidelines and Committee Charters

Our Corporate Governance Guidelines, together with our Board committee charters, provide the framework for the corporate governance of the Company. This promotes the interests of our shareholders and strengthens our Board and management accountability. Below is a summary of our Corporate Governance Guidelines and Board Committee Charters. We provide our Corporate Governance Guidelines, as well as the charters of each of our Board committees and our Code of Conduct and Code of Ethics, on our website at investors.seagate.com, under the “Governance” tab. Information contained on or accessible via our website is not incorporated by reference into this Proxy Statement or any other report we file with the SEC.

Role of the Board

The Board, elected annually by our shareholders, oversees the management of the business and affairs of the Company. In this oversight role, the Board serves as the ultimate decision-making body of the Company, except for those matters reserved for the shareholders. The Board has three standing committees: Audit and Finance, Compensation, and Nominating and Corporate Governance.

The Board and its committees have the primary responsibilities of:

 

   

reviewing, monitoring and approving the Company’s strategic direction, annual operating plan, and major corporate actions;

 

   

monitoring and evaluating the performance of the Company;

 

   

hiring and evaluating the performance of our CEO;

 

   

reviewing and approving compensation of the CEO and other executive officers;

 

   

reviewing and approving CEO and executive officer succession planning;

 

   

advising and counseling the Company’s management;

 

   

overseeing the Company’s ethical and legal compliance, including the Code of Conduct and Code of Ethics; and

 

   

overseeing the Company’s enterprise risk management processes and programs.

Environmental, Social and Corporate Governance Matters

Our values—Integrity, Innovation, and Inclusion—underpin our strategy and our approach to environmental, social, and governance (“ESG”) matters. Seagate is committed to developing and maintaining sustainable and responsible practices in its global operations. As such, Seagate is a signatory to the Responsible Business Alliance Code of Conduct and the United Nations Global Compact (UNGC) and supports their principles and standards. Management regularly reports to our Board on the outcomes of programs and processes we have established to adhere to these principles and standards as well as on other ESG matters such as the diversity of our workforce, employee development, and employee health and safety.

 

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The Board is responsible for ensuring that ESG opportunities and oversight of related risks are integrated into our long-term strategy. Rather than concentrating all ESG oversight solely at the Board or into a single Board committee, given the multi-faceted nature of the Company’s approach to ESG and its integration into our overall strategy, the Board believes each of its committees should maintain oversight over the particular ESG matters that fall within its scope. For example, the Compensation Committee has established two ESG modifiers for the performance-based share units (“PSUs”) to be granted to our NEOs in fiscal year 2022. These modifiers will increase or decrease the achievement level based on the Company’s performance against both a social (gender diversity) goal and an environmental (greenhouse gas reduction) goal. These goals are intended to incentivize our NEOs to set the tone at the top on these matters.

More information on our ESG efforts can be found on the Diversity, Equity and Inclusion (“DEI”) and Global Citizenship sections of our website, www.seagate.com, and in our fiscal year 2020 DEI Annual Report and our fiscal year 2020 Global Citizenship Annual Report, the latter of which was prepared in accordance with the Global Reporting Initiative (GRI) Standards: Core Option and is responsive to the Sustainability Accounting Standards Board (SASB) technology and telecommunication sector hardware standards. Information contained on our website is not incorporated by reference into this Proxy Statement or any other report we file with the SEC.

Role of the Board in Risk Oversight

The Board has responsibility for oversight of the processes established by management to report and monitor material risks applicable to the Company, including ESG risks. The Board and its committees focus on the Company’s general risk management strategy and the most significant risks facing the Company, and regularly review the Company’s processes for monitoring and addressing risks. The Board’s review of our long-term strategic, financial and organizational goals and its review of management’s plans designed to achieve those goals is a part of the Board’s oversight of risk management and assists the Board in assessing management’s approach to and tolerance for risk. In addition, the committees of the Board report to the full Board at regularly scheduled Board meetings on any identified material risks within that committee’s area of responsibilities.

 

   

The Audit and Finance Committee has responsibility for oversight of financial risks, including any ESG-related financial risks, in the Company’s business, cash position, financing activity, tax position and tax strategy, and corporate development plans, as well as risks associated with the Company’s financial reporting and disclosure process, and cybersecurity, data privacy, product security and other computerized information system controls;

 

   

The Compensation Committee has responsibility for oversight of the risks related to or created by the Company’s compensation programs, arrangements, policies and procedures as well as risks related to other practices and policies affecting our employees; and

 

   

The Nominating and Governance Committee has responsibility for oversight of the risks related to director and CEO succession, the Board and its committees, and corporate governance.

Our Board believes that open communication between management and our Board is essential for effective risk oversight and management. As such, the Board is informed and engaged when new risks arise. For example, in response to the COVID-19 global pandemic, the Board and the Compensation Committee each received and continues to receive regular reports from members of management to monitor and assess risks to our business and to manage the impact of the pandemic on our employees, customers, suppliers and other business partners, and the communities in which we operate globally. In addition, the Audit and Finance Committee receives regular reports from management, including the Chief Information Officer and Chief Information Security Officer, on enterprise security, data privacy and data security risks, controls, and incident preparedness.

 

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Committees of the Board

Audit and Finance Committee

Key Functions of the Audit and Finance Committee of the Board:

 

   

Oversee the Company’s financial reporting and disclosure processes.

 

   

Review annual audited and quarterly financial statements and Irish statutory financial statements, as well as the Company’s ESG disclosures and disclosures under “Management’s Discussion and Analysis of Financial Conditions and Results of Operations” contained in our SEC Forms 10-K and 10-Q and in our earnings releases, with management and the independent auditors.

 

   

Obtain and review periodic reports, at least annually, from management and from the independent auditors assessing the effectiveness of the Company’s internal controls and procedures for financial reporting.

 

   

Review and monitor the Company’s processes that are designed to ensure compliance with all applicable laws, regulations and corporate policy, including with respect to senior executives’ expenses and perquisites as well as ethics matters reported through the anonymous reporting line or from other sources.

 

   

Appoint the public accounting firm that will serve as our independent auditors and review the performance, independence, and qualifications of the independent auditors.

 

   

Review and make recommendations regarding the Company’s cash position; financial position; capital needs; financing plans; the Company’s ability to access capital markets including the Company’s debt and credit ratings; bank and lender relationships; capital structure; equity and debt issuances; dividends including and, if and as delegated by the Board, making declarations of Company dividends; share splits; financing proposals; debt issuances, repayment, repurchase or redemption of any outstanding notes; capital asset plans and capital expenditures; and corporate development plans.

 

   

Monitor and review, and make recommendations regarding, the Company’s policies and procedures around managing major risks in the Company’s business, cash position, financing activity, tax position and tax strategy, and corporate development plans, and risks pertaining to our financial reporting and disclosure processes, including disclosures with respect to ESG matters, and to other enterprise risks including cybersecurity, data privacy, product security and other computerized information system controls.

 

   

Review, evaluate and authorize management to enter into any capital market transactions (including debt and equity financings), private equity and debt financing, or proposed merger, acquisition, divestiture or investment transactions, in accordance with the committee’s delegated authority from the Board, and to review, evaluate and recommend to the Board with respect to any such transactions that exceed the committee’s delegated authority.

 

   

Review the scope of the financial statements audit and the findings and approve the fees of the independent auditors.

 

   

Review and determine in advance permitted audit and non-audit services to be performed by the independent auditors.

 

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Satisfy itself as to the independence of the independent auditors and ensure receipt of their annual independence statement.

 

   

Appoint and oversee the performance of the head of the Company’s internal audit function and approve the annual internal audit plan.

 

   

Review legal and related matters that could have a significant impact on the Company’s financial statements and compliance with applicable laws.

A copy of the charter of the Audit and Finance Committee is available on our website, investors.seagate.com, under the “Governance—Board Structure and Committees” tab.

Compensation Committee

Key Functions of the Compensation Committee of the Board:

 

   

Establish the Company’s overall compensation philosophy and the executive compensation policies.

 

   

Oversee the design, development and administration of the Company’s incentive, equity compensation and benefits plans, policies and programs.

 

   

Review and decide upon executive compensation and benefit programs and periodically review their effectiveness.

 

   

Discuss and consider the results of the shareholder advisory vote on Say-on-Pay.

 

   

Review and determine, whether as a committee or together with the other independent members of the Board, all compensation decisions pertaining to the CEO.

 

   

Review and approve or recommend to the Board, any employment contracts or other transactions with current or former named executive officers, and all other Section 16 officers, including severance or termination arrangements.

 

   

Review and, with advice from the CEO, make compensation decisions pertaining to the other executive officers.

 

   

Review and determine all corporate financial and operational performance metrics and objectives relevant to executive officers’ compensation.

 

   

Review compliance of the NEOs with the share ownership requirements.

 

   

Review and recommend significant changes in principal employee benefit programs.

 

   

Select, retain and oversee Compensation Committee consultants and advisors.

 

   

Recommend for decision by the independent members of the Board the compensation to be paid to non-employee directors.

 

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Review other programs and practices affecting our employees including with respect to compensation and the health and well-being of employees, employee development, and programs designed to promote and foster diversity, equity, and inclusion at the Company.

A copy of the charter of the Compensation Committee is available on our website, investors.seagate.com, under the “Governance—Board Structure and Committees” tab.

Compensation Risk Assessment

As noted above, the Compensation Committee considers potential risks created by the Company’s executive compensation programs. In addition, the Compensation Committee reviews all of its compensation policies and procedures to determine whether they present a significant risk to the Company. Based on these reviews, the Compensation Committee has concluded that its compensation policies, programs, and procedures do not create risks that are reasonably likely to have a material adverse effect on the Company.

Nominating and Corporate Governance Committee

Key Functions of the Nominating and Corporate Governance Committee of the Board:

 

   

Take a leadership role in shaping the corporate governance of the Company including with respect to Company culture, corporate social responsibility, sustainability, DEI and human rights.

 

   

Identify individuals qualified to become directors and recommend candidates for all directorships and Board committee memberships, and evaluate candidates nominated by shareholders on substantially the same basis as it considers other nominees.

 

   

Review the Company’s Corporate Governance Guidelines and Board committee charters, and make recommendations for changes.

 

   

Oversee the Board, Board committees, and director self-evaluation processes.

 

   

Consider questions of independence, related party transactions, and potential conflicts of interest of directors and executive officers.

 

   

Periodically review succession planning of the Board Chair, CEO and other executive officers.

 

   

Periodically review and propose amendments to the Company’s constitution.

A copy of the charter of the Nominating and Corporate Governance Committee is available on our website, investors.seagate.com, under the “Governance—Board Structure and Committees” tab.

Board Leadership Structure

Our Corporate Governance Guidelines permit the roles of Board Chair and CEO to be filled by the same or different individuals, based on the Company’s needs, best practices, and the best interests of our shareholders. This allows the Board flexibility to determine whether the two roles should be combined or separated based upon the Company’s needs and the Board’s assessment of its leadership from time to time. The Board believes that our corporate governance principles, the quality, stature and substantive business knowledge of the members of the Board, as well as the Board’s culture of open communication with the CEO and senior management, are currently

 

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conducive to separation of the Board Chair and CEO positions to maximize Board effectiveness. Separating the Board Chair and CEO positions also provides an appropriate degree of Board oversight and allows Dr. Mosley, our CEO, to focus on our business strategy and market opportunities, as well as on our organizational structure and execution capabilities.

For fiscal year 2021, Michael R. Cannon served as Board Chair. In the event that we do not have an independent Board Chair, a Lead Independent Director would be appointed as part of the organizational structure for the independent directors in order to address the need for independent leadership and perspective.

Board Composition

The Board consists of a substantial majority (82% as of the end of fiscal year 2021) of independent, non-employee directors. In addition, we require that all members of the Audit and Finance, Compensation and Nominating and Governance committees of the Board be independent directors.

The Board has determined that each member of each of these three committees is “independent” as defined in The Nasdaq Stock Market (“NASDAQ”) listing rules and that each member of the Compensation Committee and Audit and Finance Committee meet applicable NASDAQ and SEC independence standards for such committees (see “Director Independence Determination” below). The Board has also determined that three of the four members of the Audit and Finance Committee are audit committee financial experts, as that term is defined by rules of the SEC, and that each member of the Compensation Committee qualifies as a “Non-Employee Director” within the meaning of Rule 16b-3 of the Securities Exchange Act of 1934 (“Exchange Act”).

Board committee memberships and chairs are rotated periodically, and an independence analysis is conducted annually.

Board Diversity

The Nominating and Corporate Governance Committee regularly reviews the diversity of skills, expertise, background and other characteristics of existing and potential director candidates in deciding on nominations for election to the Board by the Company’s shareholders or for appointment to the Board. The Nominating and Corporate Governance Committee seeks director nominees that would complement and enhance the effectiveness of the existing Board with respect to skills, knowledge, perspectives, experience, background and other characteristics. Furthermore, the Company is committed to its value of inclusion and the Board believes it is important to consider diversity of race, ethnicity, gender, age, education, cultural background, and professional experiences. Accordingly, when evaluating candidates for nomination as new directors, the Nominating and Corporate Governance Committee will consider the foregoing factors and will include both underrepresented races and ethnicities and different genders in the pool of qualified candidates. If the Nominating and Corporate Governance Committee chooses to engage a search firm, it will instruct such search firm to include both underrepresented races and ethnicities and different genders in the initial pool of qualified candidates.

Director Independence Determination

The Board, based on its review and the recommendation of the Nominating and Corporate Governance Committee, has determined that all of our Director Nominees, with the exception of William D. Mosley, who serves as CEO of the Company, are independent under the NASDAQ listing rules and the Company’s Corporate Governance Guidelines, which are consistent with the NASDAQ listing rules. When assessing director independence, the Board considers the various commercial, charitable and employment transactions, affiliations and relationships known to the Board (including those identified through annual director questionnaires) to exist between the Company and the

 

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entities with which our directors or members of their immediate families are, or have been, affiliated. In considering such transactions, the Board determines whether any such transactions are in the ordinary course of business, fair to the Company and on terms no less favorable than terms generally available to an unaffiliated third party under similar circumstances.

Executive Sessions

The Company’s independent directors meet privately in regularly scheduled executive sessions of the Board and Board committees, without management present, to consider such matters as the independent directors deem appropriate. These executive sessions are typically held at each Board and Board committee meeting.

Board, Board Committee and Annual Meeting Attendance

The Board and the Board committees held the following number of meetings during fiscal year 2021:

 

  Board

     6      

  Audit and Finance Committee

     13      

  Compensation Committee

     7      

  Nominating and Corporate Governance Committee

     6      

Each incumbent director attended at least 83% of the total number of meetings of the Board and the Board committees on which they served during fiscal year 2021. The Company’s independent directors held executive sessions without management present during the four regularly scheduled quarterly Board meetings held in fiscal year 2021 as well as during all regularly scheduled committee meetings.

The Company expects all Board members to attend the 2021 AGM in person or to join virtually, although other commitments may prevent some directors from attending or joining the meeting. All directors who served in such capacity on October 22, 2020, other than William Coleman, virtually joined the 2020 Annual General Meeting of Shareholders of the Company (the “2020 AGM”).

Board and Committee Evaluations

As mentioned above, the Nominating and Corporate Governance Committee assists the Board in periodically evaluating its performance and the performance of the Board committees. Each Board committee conducts periodic self-evaluations, and the Board conducts periodic peer-to-peer evaluations to determine whether the Board and the committees are functioning effectively and whether any changes are necessary to improve their performance. The effectiveness of individual directors is considered each year when the Board nominates directors to stand for election.

Board Advisors

The Board and its committees may, under their respective charters, retain external and independent advisors to assist the directors in carrying out their responsibilities. For fiscal year 2021, the Compensation Committee retained FW Cook as its external and independent advisor (see “Compensation Discussion and Analysis—Role of the Compensation Consultant” below for more information).

Director Nomination Process

The Nominating and Corporate Governance Committee

 

   

conducts an annual review of the performance of the Board, Board committees, and individual directors leading up to the nomination of directors for election by the shareholders;

 

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periodically evaluates the makeup of the Board in order to determine whether the diversity of skills, experience, qualifications, perspectives and other characteristics of the existing board members adequately address the Company’s needs in light of its then current strategy;

 

   

identifies the skills, experience, qualifications, perspectives and other characteristics needed to enhance further the composition of the Board;

 

   

makes recommendations to the Board concerning the appropriate size and needs of the Board;

 

   

on its own, with the assistance of other Board members or management, a search firm or others, identifies potential candidates for election or appointment to the Board; and

 

   

seeks to ensure that the Board is composed of members whose skills, experience, qualifications, perspectives and other characteristics, when taken together, allow the Board to satisfy its oversight responsibilities effectively.

Furthermore, the Company is committed to its value of inclusion and the Board believes it is important to consider diversity of race, ethnicity, gender, age, education, cultural background, and professional experiences. Accordingly, the Nominating and Corporate Governance Committee will consider the foregoing factors and will include both underrepresented races and ethnicities and different genders in the pool of qualified candidates for nomination as a new director. If the Nominating and Corporate Governance Committee chooses to engage a search firm, it will instruct such search firm to include both underrepresented races and ethnicities and different genders in the initial pool of qualified candidates.

In nominating candidates, the Nominating and Corporate Governance Committee takes into account, among other things, the diversity factors noted above, professional experience, understanding of business and financial issues, ability to exercise sound judgment and make independent analytical inquiries, leadership, achievements, knowledge, and experience in matters affecting the Company’s business and industry. Each nominee should possess a commitment to representing the long-term interests of the shareholders, the highest character and integrity, sufficient time to devote to Board matters, an understanding of the Company’s business, and no conflict of interest that would interfere with performance as a director.

Shareholders may recommend candidates for consideration for Board membership by sending their recommendation to the Company Secretary at the registered office of the Company (details of which are included in this Proxy Statement) in accordance with our Constitution. The Company Secretary will forward the recommendations to the Nominating and Corporate Governance Committee. Candidates recommended by shareholders are evaluated in a substantially similar manner as director candidates identified by any other means.

Term Limits and Retirement

The Board does not have a mandatory retirement age for directors and, because the Nominating and Corporate Governance Committee annually evaluates director nominees for the following year, the Board has decided not to adopt specific term limits for directors.

Director Orientation and Education

The Company has developed an orientation program for all new directors that they are required to attend, which includes receiving and reviewing materials relative to our business and operations. We also encourage ongoing education for our directors and reimburse for such continuing director education. In addition, the directors are given full access to management and other employees as a means of providing additional information.

 

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Communications with Directors     

Shareholders and other interested parties wishing to communicate with the full Board, the independent directors, or any individual director (including any Board committee Chairperson) may do so in writing by sending a communication to the Board and/or a particular member of the Board, to Seagate Technology Holdings plc, 38/39 Fitzwilliam Square, Dublin 2, D02 NX53, Ireland, Attention: Company Secretary. Depending upon the nature of the communication and to whom it is directed, the Company Secretary will: (i) forward the communication to the appropriate director or directors; (ii) forward the communication to the relevant department within the Company; or (iii) attempt to handle the matter directly (for example, a communication dealing with a share ownership matter), as appropriate.

Code of Ethics

The Company has adopted a Code of Ethics which is applicable to the CEO, Chief Financial Officer and principal accounting officer or controller, or persons performing similar functions. The Code of Ethics is available at investors.seagate.com, under the “Governance—Code of Ethics” tab. Amendments to, or waivers of the Code of Ethics will be disclosed promptly on our website or on a Current Report on Form 8-K filed with the SEC. No such waivers were requested or granted in fiscal year 2021.

Anti-Hedging and Pledging Policy and Other Trading Restrictions

The Company prohibits its Board members and all employees from taking “short” positions in our securities or engaging in hedging or other monetization transactions with respect to our securities. The Company also prohibits its Board members and all employees from (i) purchasing any financial instruments designed to hedge or offset any decrease in the market value of the Company securities and (ii) engaging in any form of short-term speculative trading in Company securities. Directors, executive officers, and certain other employees are also prohibited from holding Company securities in a margin account or pledging Company securities as collateral for a loan.

Further, our directors, executive officers, and certain other employees are prohibited from trading in our securities absent pre-clearance from our designated compliance officer unless such trades are pursuant to a trading plan (a “10b5-1 plan”) meeting the requirements of Rule 10b5-1 promulgated under the Exchange Act. The 10b5-1 plan must be reviewed and acknowledged by our designated compliance officer and we require that the first trade under a newly approved 10b5-1 plan take place after a reasonable “cooling off” period has passed from the time of adoption of the plan; in addition, a director, executive officer, or other covered employee is only permitted to use one 10b5-1 plan at a time.

 

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COMPENSATION OF DIRECTORS

Director Compensation and Share Ownership

It is the Board’s practice to maintain a fair and straightforward non-employee director compensation program that is also designed to be competitive with director compensation programs of the Company’s peers. The Compensation Committee periodically reviews the type and form of compensation paid to our non-employee directors and recommends, for approval by the Board, the amount and form of director compensation. The Compensation Committee believes that a substantial portion of the total director compensation should be in the form of equity in the Company. The purpose of this is to better align the interests of the Company’s directors with the long-term interests of its shareholders. As such, the directors are subject to a share ownership requirement of four times their annual cash retainer.

Cash and Equity Compensation

Our director compensation program is designed to (i) provide our non-employee directors with reasonable and appropriate compensation for the work required for a company of our size and scope and (ii) align non-employee directors’ interests with the long-term interests of our shareholders. The program reflects our desire to attract, retain and utilize the expertise of highly qualified individuals serving on the Company’s Board. Company employees do not receive additional compensation for their service as directors.

Our fiscal year 2021 director compensation program for non-employee directors consisted of the elements set forth in the table below.

 

  Compensation Element   Position    Retainer
($)
 

  Cash Retainer

    

Board of Directors

  Board Chair (non-employee)      175,000   
  Board Member      100,000   

Audit and Finance Committee

  Chairperson      35,000   
  Member      15,000   

Compensation Committee

  Chairperson      30,000   
  Member      10,000   

Nominating and Corporate Governance Committee

  Chairperson      20,000   
  Member      10,000   

  Annual Restricted Share Unit Award (value)

       275,000   

Each non-employee director elected in connection with the annual election of directors at the 2020 AGM (including non-employee directors re-elected at the annual general meeting) received an initial restricted share unit (“RSU”) award equal in number to $275,000 divided by the average closing share price for the quarter prior to the award, rounded to the nearest whole share. If the appointment of a non-employee director occurred other than in connection with the annual election of directors at the 2020 AGM, for example, Messrs. Arumugavelu and Bhatt, this dollar amount was pro-rated for the year of appointment. If, prior to commencement of Board service, the newly elected or appointed director was an officer or member of the board of directors of an entity acquired by Seagate, the Board may award a lesser number of RSUs. The grant date for each such award was the date of the director’s election or appointment. Generally, each RSU award will vest on the earlier of the one-year anniversary of the grant date or the next election of directors at an annual general meeting (provided such annual general meeting is held at

 

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least 50 weeks after the prior meeting). All RSU awards will become fully vested in the event of a “Change of Control” of Seagate (as such term is defined in the Amended and Restated Seagate Technology Holdings plc 2012 Equity Incentive Plan (“EIP”)).

In addition to the cash compensation and equity awards, all members of the Board are reimbursed for their reasonable out-of-pocket travel expenses incurred in attending Board meetings and other Board-related activities.

For the RSU awards to be granted to the directors elected at the 2021 AGM and in the future in connection with the annual election of directors at annual general meetings, the Compensation Committee approved the following: (1) the non-employee Board chair shall receive an RSU award equal in number to $350,000 divided by the average closing share price for the quarter prior to the award, rounded to the nearest whole share, and (2) each other non-employee director shall receive an RSU award equal in number to $275,000 divided by the average closing share price for the quarter prior to the award, rounded to the nearest whole share.

Director Share Ownership Requirement

To align the interests of directors with the Company’s shareholders, the Board has adopted a share ownership requirement of four times the annual board cash retainer (excluding committee retainers, if any) for non-employee directors. The calculation of ordinary shares owned for purposes of the ownership requirement includes: (i) ordinary shares directly or indirectly owned (for example, through a trust), (ii) unvested restricted share awards or RSUs (if any) and, (iii) for any director affiliated with an entity and contractually obligated to assign to such entity any equity awards received as compensation for service as a non-employee director, shares owned by such entity or its affiliates. Until a non-employee director satisfies the mandatory ownership level, they may not sell more than that number of shares that vest pursuant to any outstanding restricted share award or RSU award as is necessary, in each case, to cover the tax liability associated with the vesting or exercise of the equity award. Once a non-employee director has attained the minimum level of Company share ownership, they must maintain this minimum level of Company share ownership until their resignation or retirement from the Board. In setting the share ownership requirement, the Board considered the input of the independent compensation consultant, the Company’s then-current share price and the period of time, generally, that it would take a non-employee director to reach the required ownership level. Directors who are Company employees are subject to the share ownership requirements described in the section entitled “Compensation Discussion and Analysis—Share Ownership Requirements” of this Proxy Statement. As of July 2, 2021, all of our non-employee Director Nominees meet the share ownership requirement with the exception of Shankar Arumugavelu who joined the Board in March 2021.

 

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Fiscal Year 2021 Non-Employee Director Compensation

The compensation paid or awarded to our non-employee directors as of July 2, 2021 for fiscal year 2021 is set forth in the table below.

 

  Name of Director   

Fees Earned

        or Paid in         

Cash

($)

  

Share
        Awards         

($)(1)

  

All Other

    Compensation    

($)

  

    Total    

($)

  Mark W. Adams

   143,215    287,731       430,946  

  Shankar Arumugavelu

     33,490    209,236       242,726  

  Prat Bhatt

     60,343    294,150       354,493  

  Judy Bruner

   145,000    287,731       432,731  

  Michael R. Cannon

   195,961    287,731       483,692  

  Jay L. Geldmacher

   110,000    287,731       397,731  

  Dylan Haggart(2)

   110,000    287,731       397,731  

  Stephen J. Luczo(3)

   100,000    287,731       387,731  

  Stephanie Tilenius

   115,000    287,731       402,731  

  Edward J. Zander

   132,582    287,731       420,313  

 

(1)

Represents the grant date fair value of RSU awards granted in fiscal year 2021 for financial reporting purposes pursuant to the provisions of Financial Accounting Standards Board’s Accounting Standards Codification (“ASC”) Topic 718, Compensation—Stock Compensation (“ASC 718”). Such amounts do not represent amounts actually paid to or realized by the non-employee director. See Note 11, “Share-Based Compensation” of the Notes to Consolidated Financial Statements in our Annual Report on Form 10-K for fiscal year 2021 regarding assumptions underlying valuation of equity awards. Additional information regarding the RSUs awarded to or held by each non-employee director on the last day of fiscal year 2021 is set forth in the table below.

(2)

Mr. Haggart is a Partner at ValueAct Capital and he relinquishes all cash and vested equity compensation received for service on our Board to the limited partners of ValueAct Capital Master Fund, L.P.

(3)

Mr. Luczo is retiring from the Board as of the end of the 2021 AGM and will not stand for re-election.

 

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The aggregate number of outstanding equity awards for each of our non-employee directors as of July 2, 2021 is set forth in the table below.

 

   Name of Director

 

     Aggregate

     Number of

       Outstanding  

     Awards

 

  Mark W. Adams

  5,847 (1) 
   

  Shankar Arumugavelu

  2,896 (2) 
   

  Prat Bhatt

  4,838 (2) 
   

  Judy Bruner

  5,847 (1) 
   

  Michael R. Cannon

  5,847 (1) 
   

  Jay L. Geldmacher

  5,847 (1) 
   

  Dylan Haggart

  5,847 (1)(3) 
   

  Stephen J. Luczo

  5,847 (1)(4) 
   

  Stephanie Tilenius

  5,847 (1) 
   

  Edward J. Zander

  5,847 (1) 

 

(1)

Represents outstanding RSUs awarded to our non-employee directors on October 22, 2020 with the exception of Shankar Arumugavelu and Prat Bhatt.

(2)

Shankar Arumugavelu and Prat Bhatt joined our Board in March 2021 and December 2020, respectively. Amount represents outstanding RSUs awarded to them on March 19, 2021 and December 24, 2020, respectively.

(3)

Mr. Haggart is a Partner at ValueAct Capital and he relinquishes all vested equity compensation received for service on our Board to the limited partners of ValueAct Capital Master Fund, L.P.

(4)

Mr. Luczo is retiring from the Board as of the end of the 2021 AGM and will not stand for re-election.

 

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PROPOSAL 2 – AN ADVISORY, NON-BINDING VOTE ON THE COMPANY’S EXECUTIVE COMPENSATION – SAY-ON-PAY VOTE

(Ordinary Resolution)

We are presenting the following proposal, commonly known as a “Say-on-Pay” proposal, which gives you as a shareholder the opportunity to vote, on an advisory, non-binding basis, on the compensation of our NEOs for fiscal year 2021, as required by Section 14A of the Exchange Act and the related rules of the SEC. The Board has determined to hold a Say-on-Pay advisory vote each year. You may endorse or not endorse, respectively, the compensation paid to our NEOs by voting for or against the following resolution:

“RESOLVED, as an ordinary resolution, that, on an advisory, non-binding basis, the compensation of the Company’s named executive officers, as disclosed in the Compensation Discussion and Analysis, the accompanying compensation tables and the related disclosure contained in the Company’s Proxy Statement, is hereby approved.”

While our Board intends to carefully consider the shareholder vote resulting from the proposal, the final vote is advisory and will not be binding.

In considering your vote, please be advised that our compensation program for our NEOs is guided by our compensation philosophy, as further described under the “Compensation Discussion and Analysis” section below:

 

   

CEO cash compensation tied to performance. At least half of the annual target for the aggregate cash compensation component for our CEO is based on Company and individual performance. The total actual cash compensation of our CEO has fluctuated from year to year. In addition, we have implemented a cap on annual bonus funding for all executive officers.

 

   

Long-term equity incentive compensation tied to performance. In fiscal year 2021, a majority of our long-term equity incentive awards for the CEO and Executive Vice Presidents (“EVPs”) were granted in the form of PSUs, which vest dependent upon the achievement of pre-established financial and operational performance objectives, including return on invested capital, relative total shareholder return and/or adjusted earnings per share (as applicable, and as described in further detail in this Proxy Statement).

 

   

Compensation unrelated to performance is limited. We do not have guaranteed incentive awards, “golden parachutes,” single trigger change of control severance provisions, executive pensions or excise or golden parachute tax gross-ups for our NEOs.

 

   

Share Ownership Requirements. Our share ownership requirements for our NEOs directly link the interests of management and our shareholders.

Vote Required; Recommendation of the Board

A simple majority of all votes cast by holders of ordinary shares on the Record Date represented in person or by proxy at the 2021 AGM in Dublin is required to approve Proposal 2.

THE BOARD RECOMMENDS THAT YOU VOTE “FOR” THIS PROPOSAL 2 TO APPROVE, ON AN ADVISORY, NON-BINDING BASIS, THE COMPENSATION OF OUR NAMED EXECUTIVE OFFICERS AS DISCLOSED IN THE COMPENSATION DISCUSSION AND ANALYSIS, THE ACCOMPANYING COMPENSATION TABLES, AND THE RELATED DISCLOSURE CONTAINED IN THIS PROXY STATEMENT.

 

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COMPENSATION DISCUSSION AND ANALYSIS

Fiscal Year 2021 Company Highlights

In response to the COVID-19 global pandemic and to protect the health and well-being of our employees, customers, suppliers and the communities in which we operate, we implemented significant safety protocols since the start of the pandemic, including employees working from home, restricting the number of employees attending events or meetings in person, limiting the number of people in our buildings and factories at any one time, further restricting access to our facilities, suspending employee travel, refraining from meeting in person with customers and suppliers, health and temperature screenings, contact tracing and enhanced cleaning procedures. We will continue to monitor the impact of the COVID-19 pandemic and will adjust these measures over time as appropriate to protect the health and well-being of our employees, customers, suppliers and communities around the world.

Highlights of fiscal year 2021 financial performance include:

 

   

We grew revenue to $10.7 billion navigating both macro-economic challenges and the COVID-19 global pandemic. Approximately 60% of revenue was derived from the mass capacity storage markets to support our customers’ increasing demand for data, which led to record capacity shipments of 535 exabytes.

 

   

We expanded operating profits by 15% year-over-year to $1.5 billion and generated over $1.6 billion in cash flow from operations.

 

   

We increased diluted earnings per share by 42% year-over-year to $5.36.

 

   

We returned approximately $2.7 billion in capital to our shareholders through dividends and share repurchases demonstrating our long-standing commitment to shareholder returns. We paid $649 million in dividends and repurchased approximately 34 million shares or 13% of total shares outstanding.

The following table presents certain key financial metrics for the past three fiscal years.

 

 

  (in millions except earnings per share, exabytes and gross and operating
margin percentages)

  Fiscal Year 2021       Fiscal Year 2020        Fiscal Year 2019      

 Exabytes shipped

    535       442        347     

 Revenues (GAAP)

  $ 10,681     $ 10,509      $ 10,390     

 Gross margin percentage (GAAP)

    27       27        28     

 Operating margin percentage (GAAP)

    14       12        14     

 Income from operations (GAAP)

  $ 1,492     $ 1,300      $ 1,487     

 Net income (GAAP)

  $ 1,314     $ 1,004      $ 2,012(1)  

 Diluted earnings per share (GAAP)

  $ 5.36     $ 3.79      $ 7.06(1)  

 

(1)

The Company recorded an income tax benefit of $640 million for fiscal year 2019. Please see the section entitled “Financial Statements and Supplementary Data” in our Annual Report on Form 10-K for fiscal year 2019.

Please see the section entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for fiscal year 2021 for a more detailed description of our fiscal year 2021 financial results.

 

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Executive Summary

This Compensation Discussion and Analysis provides an overview of our executive compensation program for fiscal year 2021 and our executive compensation philosophies and objectives, as well as the compensation awarded to our fiscal year 2021 NEOs, who are listed below.

 

 

  Named Executive Officers

  Job Title

 William D. Mosley

  Chief Executive Officer

 Gianluca Romano

  Executive Vice President and Chief Financial Officer

 Jeffrey D. Nygaard

  Executive Vice President, Operations and Technology Development

 Ravinandan (“Ravi”) Naik

  Executive Vice President, Storage Services and Chief Information Officer

 Ban Seng Teh

  Executive Vice President, Global Sales and Sales Operations

Fiscal Year 2021 Executive Compensation Highlights

Key highlights of our executive compensation program for fiscal year 2021 are as follows:

 

   

Emphasize Pay-for-Performance Alignment: Our general philosophy and structure of the Company’s executive compensation programs seek to emphasize strong alignment between executive pay and corporate financial, strategic and other business performance. A majority of our executives’ target total compensation is “at risk,” including cash and equity compensation that is tied to pre-established financial and operational-performance goals aligned with our short- and long-term objectives.

 

   

Deliver on our Pay-for-Performance Philosophy: Annual cash incentive payouts reflected the Company’s financial performance in fiscal year 2021. Based on performance against the Company’s executive officer performance cash bonus metrics (revenue, adjusted operating margin, year-over-year revenue growth, and a customer satisfaction metric), the fiscal year 2021 bonus pool funding was at 121.52% of target. PSUs that were granted in fiscal year 2018 vested at 195.20% of target based on our three-year average annual return on invested capital (“ROIC”) as adjusted by our relative total shareholder return (“rTSR”) over the three-year performance period. With respect to the outstanding Threshold Performance Share Units (“TPSUs”), our threshold adjusted earnings per share (“AEPS”) performance for fiscal year 2021 was above the $1.00 AEPS threshold; therefore, an additional 25% of each of the outstanding TPSU awards will vest on their next scheduled vesting date following the end of fiscal year 2021, subject to continued employment. No discretion was utilized on either the level of funding for the annual cash bonus plan or the vesting of any long-term equity incentive awards.

 

   

Align Executive Compensation with Shareholder Interests: Long-term equity incentives for Dr. Mosley and Messrs. Romano and Nygaard were granted at target levels using a portfolio of 80% performance-based awards to emphasize long-term strategic incentives (based on achievement of AEPS, ROIC, and/or rTSR goals) and 20% time-based share options. Mr. Naik received 27% time-based RSUs, 42% performance-based awards and 31% time-based share options and Mr. Teh received 33% time-based RSUs, 41% performance-based awards and 26% time-based share options.

 

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Fiscal Year 2021 Executive Compensation Practices

Our executive compensation policies and practices reinforce our pay-for-performance philosophy and align with commonly viewed best practices and sound governance principles.

 

WHAT WE DO    What We Don’t Do

   A majority of the equity incentives granted to our CEO and EVPs are performance-based

  

X  No “single trigger” change in control benefits

   Caps on performance-based cash and equity incentive compensation for our executive officers

  

X  No excise tax reimbursements or tax “gross-ups” in connection with a change in control

   Payouts under our cash bonus plan and awards under our equity incentive compensation plan for executive officers are largely based on achievement of financial and operating-performance metrics

  

X  No guaranteed salary increases or guaranteed bonus payments for our executive officers in fiscal year 2021

   A majority of total executive target compensation is “at-risk” and dependent on corporate performance

  

X  No defined benefit pension plan or supplemental executive pension plan

   Clawback provisions on incentive cash and equity compensation

  

X  No re-pricing of options without shareholder approval

   Annual as well as periodic review of, and determination upon, our compensation strategy by the Compensation Committee

  

X  No dividend equivalents on unvested equity awards

   Prohibition on short sales, hedging of share ownership positions and transactions involving derivatives of our ordinary shares for all employees and directors and restrictions on pledging of our ordinary shares as collateral for loans for directors, executive officers and certain other employees

  

   Meaningful share ownership requirements for executive officers and directors

  

   Independent compensation consultant engaged by the Compensation Committee

  

   Annual risk assessment of our compensation programs and practices

  

Our Executive Compensation Strategy

Our executive compensation strategy is intended to drive high performance, strengthen our market position, and increase shareholder value. The goals of our executive compensation programs are to:

 

   

attract and retain talented leaders through competitive pay programs;

 

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motivate executive officers to achieve and exceed financial, strategic and other business objectives as set by the Board or Compensation Committee;

 

   

align executive officer and shareholder interests to optimize long-term shareholder value with acceptable risk; and

 

   

manage total compensation costs in support of our financial performance.

In July 2021, to further align our compensation philosophy with our Company values, the Compensation Committee decided to tie certain NEO compensation to the achievement of specified ESG goals. The PSUs to be granted to our NEOs in fiscal year 2022 will contain two ESG modifiers that will increase or decrease the PSU achievement level based on the Company’s performance against both a social (gender diversity) goal and an environmental (greenhouse gas reduction) goal.

Our Fiscal Year 2021 Executive Compensation Programs

 

 

  Compensation Element

  Designed to Reward   Relationship to Compensation Strategy
 Base Salary   Related job experience, knowledge of the Company and our industry, and continued dedicated employment with sustained performance   Attract and retain talented executive officers through competitive pay programs

 Annual Incentive

 Executive Officer Performance

 Bonus Plan

  Achievement of the Company’s annual financial and operational goals  

Motivate executive officers to achieve and exceed annual financial, strategic and other business objectives

 

Manage total compensation costs and align them with financial performance

 Long-Term Equity Incentives

 Equity Awards

  Increased shareholder value through achievement of long-term strategic goals based on criteria such as earnings per share (EPS), return on invested capital (ROIC) and total shareholder return relative to peers (rTSR)  

Align executive officers and shareholder interests to optimize shareholder value

 

Motivate executive officers to achieve and exceed long-term financial, strategic and other business objectives

Role of Our Compensation Committee

As noted previously, the Compensation Committee is responsible for overseeing the design, development and administration of our compensation and benefits policies and programs. In executing their duties, the Compensation Committee:

 

   

determines all corporate financial and operating-performance metrics and objectives, including any ESG metrics, relevant to each executive officer’s incentive compensation;

 

   

evaluates the CEO’s performance results in light of such metrics and objectives;

 

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evaluates the competitiveness and mix of each executive officer’s cash bonus and long-term equity incentive targets in relation to compensation paid to executives performing similar functions at our peer companies; and

 

   

reviews and, with advice from the CEO in the case of the other executive officers, decides upon or recommends (as applicable) any changes to our CEO’s and other executive officers’ total compensation packages, including base salary, annual cash bonus and long-term equity incentive award opportunities, share ownership requirements and retention programs.

The Compensation Committee recommends to the independent directors of the Board the compensation plans and equity awards specific to our CEO, and the independent directors of the Board determine the overall compensation package of our CEO. Our CEO does not participate in the determination of their own compensation. The Compensation Committee is supported in its work by our Senior Vice President of Human Resources and their staff, and an independent executive compensation consultant, as described below. The Compensation Committee reviews and determines, with advice from the CEO, the compensation of all other executive officers.

Role of the Compensation Consultant

The Compensation Committee retained FW Cook as its independent consultant for advice and counsel during fiscal year 2021 to provide an external review of compensation proposals and to ensure alignment of our compensation decisions to our executive compensation strategy. FW Cook’s consulting during fiscal year 2021 also included consultation in support of the Compensation Committee’s decisions regarding NEO compensation programs, including salary changes, determination of equity awards, annual incentive plan design, and annual review of our severance plan and share ownership requirements. FW Cook also provided to the Compensation Committee recommendations related to the CEO’s compensation and advice regarding non-employee director compensation.

FW Cook is not permitted to provide services to the Company’s management except as directed by the Compensation Committee and did not provide such services in fiscal year 2021. The Compensation Committee retains sole authority to hire any compensation consultant, approve its compensation, determine the nature and scope of its services, evaluate its performance and terminate its engagement.

In connection with its engagement of FW Cook, the Compensation Committee considered various factors in determining FW Cook’s independence including, but not limited to (i) the amount of fees received by FW Cook from Seagate as a percentage of FW Cook’s total revenue, (ii) FW Cook’s policies and procedures designed to prevent conflicts of interest, and (iii) the existence of any business or personal relationship that could impact FW Cook’s independence. After reviewing these and other factors, the Compensation Committee determined that FW Cook was independent and its engagement did not present any conflicts of interest under SEC rules or the NASDAQ listing rules.

Role of our CEO and Management in the Compensation Process

Based on management’s review of market competitive practices, and within the framework of the Company’s approved compensation programs, each year our CEO recommends the amount of base salary increase (if any), the amount of the annual incentive bonus opportunity, and the long-term equity incentive award value for our executive officers, including the NEOs. These recommendations are based upon the CEO’s assessment of each executive officer’s performance and individual retention considerations, as well as the Company’s performance as a whole. The Compensation Committee reviews and evaluates the CEO’s recommendations and decides, in its sole discretion, upon our executive officers’ compensation, including any changes to such compensation. Our CEO does not recommend their own compensation and the Compensation Committee and the independent directors meet without our CEO present when evaluating and setting the CEO’s compensation.

 

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Our Senior Vice President of Human Resources and members of their staff assist the Compensation Committee in its review of our executive compensation plans and programs, including providing market data on competitive pay practices, program design and changes in the corporate governance landscape concerning executive compensation matters.

Fiscal Year 2020 Shareholder Advisory Vote Results

At the 2020 AGM, the Company’s shareholders approved the advisory proposal regarding the compensation of the NEOs for fiscal year 2020 with approximately 94% of the votes cast in favor of our executive compensation programs (excluding abstentions/broker non-votes). The Board appreciates the shareholders’ continued support of the Company’s compensation philosophy and objectives. This support reaffirms to the Board the appropriateness, effectiveness and market competitiveness of the Company’s executive compensation programs, including continued emphasis on programs that reward our executive officers for generating sustainable profitability and delivering long-term value for our shareholders. No significant changes were made to the Company’s overall executive compensation strategy in fiscal year 2021. The Board and the Compensation Committee will continue to consider the results of the Company’s annual shareholder advisory votes when making future compensation decisions for our executive officers, including the NEOs.

Executive Market Comparison Peer Group and Benchmark Philosophy

The Compensation Committee reviews executive officers’ roles and responsibilities and establishes ranges for each incentive element of executive compensation after reviewing similar information for a defined group of companies (the “Executive Peer Group”) that compete for comparable executive talent. The Compensation Committee reviews analyses of disclosures and of published surveys of compensation among the Executive Peer Group companies when considering salary, bonus and long-term equity incentive compensation of executive officers in similar roles.

As part of our annual review cycle, the Compensation Committee reviewed the Executive Peer Group and no changes were made to the selection criteria for fiscal year 2021. Executive Peer Group companies were selected based on the following criteria:

 

   

similar industry classification (as defined by Global Industry Classification Standard (GICS), 4520 Technology Hardware and Equipment or 4530 Semiconductors and Semiconductor Equipment) but excluding wholesale distributors and companies that are not subject to U.S. securities law reporting requirements,

 

   

market value of at least 0.5 times that of Seagate,

 

   

trailing twelve-month (TTM) sales of between $4B and 3 times that of Seagate’s; and

 

   

a comparable business model to Seagate.

We do not benchmark the total annual compensation of our executive officers to a specific market percentile, although the total annual target compensation (including base salary, target annual cash bonus incentive and target long-term equity incentives) for the executive officers, including the NEOs, generally has fallen near the median for similar positions within the Executive Peer Group.

The Compensation Committee considers the pay practices and relative performance of our Executive Peer Group companies in determining target incentive compensation for our executive officers. The target amounts and

 

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compensation mix vary for each executive officer and are dependent upon various factors, none of which is specifically weighted, including the importance of the position to our organization, overall retention value, internal pay equity, and projected future value of the total compensation package. Generally, the amounts actually realized by our executive officers are dependent on the Company’s financial and operational performance.

The Executive Peer Group for fiscal year 2021 included the following companies(1):

 

 FY2021 Executive Peer Group

           

 Advanced Micro Devices, Inc.

  Flex Ltd.   Lam Research Corporation   NetApp, Inc.

 Analog Devices, Inc.

  Hewlett-Packard Enterprise Co.   Microchip Technology Inc.   Western Digital Corporation

 Applied Materials, Inc.

  Juniper Networks, Inc.   Micron Technology, Inc.   Xerox Holding Corporation

 Corning Incorporated

  KLA Corporation   Motorola Solutions, Inc.   Zebra Technologies Corporation

 

  TTM Sales ($M)(1) FYE Sales ($M)(1) Market Value ($M)(1)

 Peer Group Median

$  8,497 $  8,498 $22,710

 Peer Group Average

$11,545 $11,876 $25,928

 Seagate Technology Holdings plc

$  9,997 $10,390 $15,229

 

(1)

Based on information available as of November 12, 2019, which was the most recent available data at the time the fiscal year 2021 peer group was approved in January 2020.

For fiscal year 2021, no companies were added to or removed from the Executive Peer Group.

How We Determine Individual Compensation Amounts for the NEOs

As discussed above under the heading “Role of our CEO and Management in the Compensation Process,” the CEO recommends to the Compensation Committee all compensation elements for our NEOs (other than the CEO) and the Compensation Committee determines the value of each compensation element as described below. The CEO recommendations are based upon the CEO’s assessment of each executive officer’s performance and individual retention considerations, as well as the Company’s performance as a whole. The CEO does not recommend their own compensation and the Compensation Committee and the independent directors meet without the CEO present when evaluating and setting the CEO’s compensation.

Our Senior Vice President of Human Resources and members of their staff assist the Compensation Committee in its review of our executive compensation plans and programs, including providing market data on competitive pay practices, program design and changes in the corporate governance landscape concerning executive compensation matters.

The proportion of each compensation element (i.e., the compensation mix) relative to total compensation varies by individual, although for our executive officers, the emphasis is on compensation that is variable and contingent on our financial and operational performance. Variations in the compensation mix among NEOs reflect differences in scope of responsibility as well as Executive Peer Group market data.

 

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Annual Total Target Compensation Mix

 

 

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Fiscal Year 2021 Actual Total Compensation Mix

 

 

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Annual Base Salary

Base salaries are the fixed annual cash amounts paid to our executive officers, including the NEOs. In reviewing and determining base salaries, the Compensation Committee considers:

 

   

related experience;

 

   

expected future contributions;

 

   

overall ability to influence our financial performance and the strategic impact of the role;

 

   

the ease or difficulty of replacing the incumbent; and

 

   

in the case of executive officers other than the CEO, recommendations of the CEO.

Salaries are reviewed annually and may be modified to reflect significant changes in the scope of an executive officer’s responsibilities and/or market conditions. Our goal is to be competitive with respect to base salary while distinguishing ourselves from the Executive Peer Group by providing a greater emphasis on compensating our executive officers through the use of performance-based incentives that are consistent with our strategy of motivating executive officers to achieve and exceed annual and multi-year business objectives.

Considering the Company’s ongoing efforts to reduce costs and emphasis on free cash flow, the base salaries of Dr. Mosley and Messrs. Romano and Nygaard remained flat for fiscal year 2021. However, due to their promotion to Executive Vice President, Messrs. Naik and Teh received base salary increases.

The following NEO annualized base salary changes occurred during fiscal year 2021:

 

 Named Executive Officer   

FY2020

Base

Salary

$

    

FY2021

Base
Salary
(1)

$

    

Percent    

Change    

%    

 

 William D. Mosley

     1,100,008        1,100,008        0 %     

 Gianluca Romano

     600,018        600,018        0 %     

 Jeffrey D. Nygaard

     480,002        480,002        0 %     

 Ravi Naik(2)

     425,006        470,018        11 %     

 Ban Seng Teh(3)

     357,187        427,477        20 %     

 

(1)

Any base salary increases were due to promotions to Executive Vice President during the fiscal year.

(2)

Mr. Naik was not an NEO in fiscal year 2020.

(3)

Based on the Singapore dollar (SGD) period-end foreign exchange rate for fiscal year 2021 of 0.7434.

Annual Incentive Plan—Executive Officer Performance Bonus

All executive officers participate in our shareholder-approved Executive Officer Performance Bonus Plan (“EOPB”), which is intended to promote achievement of the annual financial and operating-performance metrics set by the Compensation Committee. Following the end of the fiscal year, the Compensation Committee determines and certifies the achievement level(s) of the metrics, which determines the level of funding for the EOPB bonus pool. The funded amount, once approved by the Compensation Committee, is allocated among eligible participants.

 

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The target cash bonus percentage for each executive officer is based on the competitive marketplace and the executive officer’s role, as well as taking internal pay equity into consideration. Actual cash payments under the EOPB may be above or below this level, based on the executive officer’s performance versus pre-established goals. Individual awards paid to each executive officer, except the CEO, are determined by the Compensation Committee. Based on the recommendation of the Compensation Committee, the independent directors of the Board determine the CEO’s target cash bonus percentage and the actual cash award based on the CEO’s performance versus pre-established goals.

On July 22, 2021, the Compensation Committee certified the achievement level of the Company’s relevant annual financial and operating-performance metrics, which are used for calculating the level of EOPB bonus pool funding for fiscal year 2021. The bonus pool funding was set at 121.52% of target. The funding level for fiscal year 2021 was determined based on the Company’s actual performance with respect to attainment of specified levels of the following financial and operating-performance metrics:

 

   

revenue; and

 

   

adjusted operating margin (defined as adjusted operating income, divided by revenue) (“AOM”)

The achievement level is then modified by:

 

   

Year-over-year revenue growth; and

 

   

our Total Customer Experience (“TCE”) metric, which is a measure of our customers’ overall satisfaction with their Seagate experience, from product quality to responsiveness of service.

While we track many financial, operating and strategic performance metrics throughout the year, the combination of AOM and revenue are considered a key measure of our success in achieving profitable growth and were selected for fiscal year 2021 to continue to align payouts under the EOPB with the Company’s profitability year-over-year. Adjusted operating income, used to determine AOM for purposes of the EOPB, is defined as operating income adjusted to exclude the impact of (a) material, unusual or non-recurring gains and losses, accounting charges or other extraordinary events that were not foreseen at the time the performance targets were established, as publicly reported in the Company’s non-U.S. GAAP financial measures each quarter and (b) variable cash compensation expense. Any adjustment factors for AOM at the end of the fiscal year are reviewed and decided upon by the Compensation Committee. The revenue and AOM achievement level is then modified by year-over-year revenue growth and TCE. The year-over-year revenue growth modifier was introduced in fiscal year 2021 to maintain accountability for year-over-year growth expectations. TCE is comprised of two customer satisfaction measurements, which are evaluated quarterly:

 

   

Quarterly Business Review (“QBR”): Customers provide a ranking of Seagate against its competitors through customer scorecards; and

 

   

Net Promoter Score (“NPS”): A Best in Class standard consumer measure that indicates if end users are satisfied with their experience of the Seagate brand.

The target AOM for fiscal year 2021 was established with a threshold performance level of 11.5%, a target performance level of 16.2%, and a maximum performance level of 20.2%. Once the Company meets or exceeds the threshold AOM, the combination of revenue and AOM determines preliminary funding for the bonus pool. The QBR metric (weighted 15%) may increase or decrease bonus pool funding up to 3.75% each quarter and the NPS metric (weighted 10%) may increase or decrease bonus pool funding up to 2.50% each quarter, resulting in up to 25% of

 

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bonus pool funding being at risk. Year-over-year revenue growth may increase or decrease bonus pool funding up to 10%. For fiscal year 2021, the AOM performance level was 17.15%, revenue was $10.681 billion, the total annualized TCE modifier (QBR + NPS) was 6.25%, and the year-over-year revenue growth target level was achieved resulting in no increase or decrease to the pool based on this modifier, which, in the aggregate, as noted above, resulted in total EOPB bonus pool funding of 121.52% of target.

The individual bonuses paid to our NEOs are based upon each NEO’s target cash bonus expressed as a percentage of base salary. For fiscal year 2021, there were no changes to the target cash bonus percentages from the prior year other than Mr. Teh whose target bonus, due to his promotion to Executive Vice President, is no longer split between the EOPB and sales commissions and was increased to 100% (Mr. Naik was not an NEO in fiscal year 2020):

 

   

Dr. Mosley had a target bonus equal to 150% of his base salary in his role as CEO;

 

   

Messrs. Romano, Nygaard, Naik and Teh had a target bonus equal to 100% of their annual base salary in their roles as Executive Vice President;

The Board retains the discretion to reduce or increase the amount of the actual cash bonus payments made to an NEO based on its overall assessment of the NEO’s performance against pre-established goals and objectives, and including factors such as revenue, profitability, product quality, cost containment and expense management, market share, strategic objectives and legal and regulatory compliance. Adjustments to actual cash bonus payouts may be made by the Compensation Committee with respect to all NEOs except our CEO, and by the independent directors of the Board for our CEO.

Given the funded EOPB bonus pool amount, the Company determined to award the following cash bonuses for fiscal year 2021:

 

 Named Executive Officer  

Annual

          Salary           

($)

    

Target

Bonus

        Percentage         

(%)

  

FY2021

EOPB

      Funding(1)      

(%)

  

FY2021

EOPB

      Payment       

($)

 

 William D. Mosley

    1,100,008      150    122      2,005,095    

 Gianluca Romano

    600,018      100    122      729,141    

 Jeffrey D. Nygaard

    480,002      100    122      583,298    

 Ravi Naik

    470,018      100    122      571,165    

 Ban Seng Teh(2)

    427,477      100    122      519,471    

 

(1)

Percentages are rounded to the nearest whole number.

(2)

Based on the Singapore dollar (SGD) period-end foreign exchange rate for fiscal year 2021 of 0.7434.

Long-Term Equity Incentives

In fiscal year 2021, the Compensation Committee granted equity awards to the NEOs under the terms of the EIP. The EIP is intended to:

 

   

focus executive officers and employees on achieving longer-term financial, strategic and other business performance goals;

 

   

provide significant reward potential for outstanding cumulative performance by the Company;

 

   

enhance the Company’s ability to attract and retain highly-talented executive officers and employees; and

 

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provide the Company’s management and employees with an opportunity for greater equity ownership and related incentives to increase shareholder value.

When determining our NEOs’ equity incentive awards, the Compensation Committee considers comparable equity incentive awards to executive officers in the Company’s Executive Peer Group, the NEO’s role, individual performance and potential future contributions. Our equity award guidelines and mix of the type of awards granted are based on an analysis of the unvested equity held by an NEO, the practices of Executive Peer Group companies in awarding equity for similar positions (including equity mix and award values), potential impact on earnings, and the pool of available shares. In determining the award for each NEO, the Compensation Committee also considers the Company’s goals for retaining the NEO for the long term.

NEOs are generally awarded equity on an annual basis, typically in mid-September, as part of our annual award cycle, and these equity incentive awards generally consist of a mix of time-vesting options and performance-based awards (each as governed by the EIP and as described more fully below), reflecting a strong emphasis on pay-for-performance and the alignment of interests between our NEOs and our shareholders.

With the exception of Messrs. Naik and Teh, the equity awards made to each of our NEOs for fiscal year 2021 are comprised of 20% time-based options and 80% performance-based awards (the mix of performance-based awards consisting of 30% TPSUs and 50% PSUs). In their previous roles as Senior Vice Presidents, Messrs. Naik and Teh received a mix of 70% time-based RSUs and 30% PSUs. Messrs. Naik and Teh received additional awards, consisting of a mix of 50% time-based options and 50% TPSUs due to their promotions to Executive Vice President in February 2021. This reflects the Compensation Committee’s review and assessment of market practices at Executive Peer Group companies, as well as its determination that these mixes provide an appropriate blend of equity incentives to sustain and improve the Company’s financial performance and shareholder value.

Options

Options generally vest over four years and have a seven-year term. Options are awarded with an exercise price equal to the fair market value of the Company’s ordinary shares on the grant date. Fair market value is defined as the closing price of the Company’s ordinary shares on the NASDAQ on the grant date. The grant date and vesting schedule for options granted to our eligible NEOs are generally determined during the annual award process but may be different in the case of a new hire or change in employment position.

Share Awards

Restricted Share Units

RSUs generally vest in equal annual installments over four years, contingent on continued service. Each RSU represents the right to receive one of our ordinary shares. If under the terms of the RSU award agreement dividend equivalents accrue, such dividend equivalents are subject to the same vesting conditions as the RSUs, and, therefore, no dividend equivalent payment, if any, will be paid to the employee on any ordinary shares underlying the RSUs until the RSUs vest. Due to our emphasis on pay-for-performance, our CEO and EVPs are not eligible to receive RSUs under the Compensation Committee’s current policies; we believe that long-term equity awards made to our CEO and EVPs should consist only of options, performance-vesting shares, TPSUs, or PSUs. All outstanding RSU awards currently held by Messrs. Nygaard, Naik and Teh were granted prior to their promotions to their current positions.

Threshold Performance Share Units

TPSUs are equity awards with a maximum seven-year vesting period, contingent on continued service and the achievement of the specified AEPS goal. Each TPSU represents the right to receive one of our ordinary shares.

 

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For each tranche of a TPSU award that is eligible to vest on a vesting date, vesting is contingent on the Company achieving a threshold AEPS goal of $1.00 for the fiscal year prior to the year in which the vesting date occurs. If the threshold goal is not achieved, vesting of that tranche is delayed to the next scheduled vesting date for which the AEPS goal is achieved. TPSU awards may become fully vested as early as four years from the grant date and remain eligible to vest for up to seven years following the grant date. If the AEPS threshold level has not been met by the end of the seven-year period, any unvested TPSUs will be forfeited. Unvested awards from prior years may vest cumulatively on the scheduled vesting date in a future year within the seven-year vesting period if the annual AEPS threshold for that year is achieved. For example, if AEPS performance prior to the first vesting date is below the AEPS threshold, then vesting will be delayed. If the AEPS threshold is achieved prior to the second vesting opportunity, then 50% of the award will vest (25% from the first vesting date and 25% from the second vesting date due to the cumulative feature of the award). For purposes of the TPSU awards, AEPS is based on diluted earnings per share, calculated in accordance with U.S. GAAP, excluding the impact of (a) share-based compensation expenses and (b) material, unusual or non-recurring gains and losses, accounting charges or other extraordinary events that were not foreseen at the time the performance target was established, in each case of (a) and (b), as publicly reported in the Company’s non-U.S. GAAP financial measures. If under the terms of the TPSU award agreement dividend equivalents accrue during the vesting period, such dividend equivalents are subject to the same vesting conditions as the TPSUs. Consequently, no dividend equivalent payment, if any, will be paid to the employee on any of the ordinary shares underlying the TPSUs until the TPSUs vest.

Our AEPS performance for fiscal year 2021 was above the $1.00 AEPS threshold; therefore, an additional 25% of each of the outstanding TPSU awards will vest on their next scheduled vesting date following the end of fiscal year 2021, subject to continued employment.

Performance Share Units

PSUs are performance-based RSUs that vest after the end of a three-year performance period, subject to continued employment and the achievement of annual ROIC over the performance period, modified by a factor based on the Company’s rTSR percentile compared with the Executive Peer Group. ROIC was selected as a key metric because of its ability to measure the efficiency of our use of capital and delivery of earnings above investment, considered a critical factor in the Company’s long-term success. In addition, the rTSR metric rewards financial performance and is measured by the change in our share price and the dividends we declared during the performance period relative to the performance of the Executive Peer Group. The Compensation Committee determines the number of PSUs that will vest at the end of the three-year performance period according to a pre-established vesting matrix. Payout of the targeted number of PSUs will occur if target ROIC is attained over the three-year measurement period and rTSR is at least at the median of the Executive Peer Group. The final ROIC metric is calculated as the average annual ROIC over the prior three fiscal years. Annual ROIC is calculated as (i) adjusted operating income multiplied by (1 minus the average tax rate), divided by (ii) (x) adjusted net plant, property and equipment plus total current assets minus cash and cash equivalents, minus (y) current liabilities with the exclusion of the current portion of long-term debt. All values represent U.S. GAAP results except adjusted operating income and adjusted net plant, property and equipment. Adjusted operating income, used to determine Annual ROIC, is operating income adjusted to exclude the impact of (a) share-based compensation expense and (b) material, unusual or non-recurring gains and losses, accounting charges or other extraordinary events that were not foreseen at the time the performance target was established, in each case of (a) and (b), as publicly reported in the Company’s non-U.S. GAAP financial measures each quarter. Adjusted net plant, property and equipment includes net plant, property and equipment and the net value of right of use assets acquired through leasing.

For fiscal year 2021, the rTSR modifier was interpolated and set between 25th to 75th percentiles of the Executive Peer Group’s TSR. For awards granted in fiscal year 2021, assuming the minimum ROIC performance threshold is achieved, the actual number of ordinary shares that may vest ranges from 38% of the target number of

 

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PSUs (assuming ROIC at the threshold level and relative TSR at or below the 25th percentile of the Executive Peer Group) to 200% of the target number of PSUs (assuming an ROIC at the maximum level and relative TSR equal to or above the 75th percentile of the Executive Peer Group). The specific ROIC target values for the PSUs are not publicly disclosed at the time of grant due to the proprietary nature and competitive sensitivity of the information. Each PSU represents the right to receive one of our ordinary shares. If under the terms of the PSU award agreement dividend equivalents accrue during the vesting period, such dividend equivalents are subject to the same vesting conditions as the PSUs. Consequently, no dividend equivalent payments, if any, will be paid to the employee on any of the ordinary shares underlying the PSUs until the PSUs vest.

In fiscal year 2018, we granted PSUs (“FY2018 PSUs”) to Dr. Mosley and Messrs. Nygaard and Teh that were eligible to vest after the end of a three-year performance period ending on July 3, 2020 (i.e., vest during fiscal year 2021), subject to continued employment and the achievement of target ROIC over the performance period, modified by a factor based on our rTSR percentile. Our average share price at the beginning of the FY2018 PSUs’ performance period was $32.26 and our ending average share price was $53.94 (assuming dividends were reinvested). Therefore, our rTSR over the performance period from July 1, 2017 through July 3, 2020 was 67.23% and our shares performed at the 72nd percentile relative to the companies in the Executive Peer Group, which resulted in a modifier of 122%. The Compensation Committee certified the level of achievement of the financial performance metrics for the three-year measurement period, such that the FY2018 PSUs vested at 195.20% of target based on a three-year average annual ROIC of 92%, and rTSR at the 72nd percentile over the three-year period.

FY2018 PSUs

 

 Average ROIC    Threshold      Target      Maximum      Actual    

 3-Year Average Annual Return on Invested Capital (ROIC)

     < 30%        58%        ³ 75%        92%    

 Vesting Level (% of Target)

     0%        100%        160%        160%    
           
 rTSR Modifier    Threshold      Target      Maximum      Actual    

 Relative Total Shareholder Return Percentile

     £ 25th%ile        50th%ile        ³ 75th%ile        72%ile    

 rTSR %ile Modifier1

     75%        100%        125%        122%    

 Overall Results

              195.20%    

 

(1)

with interpolation between points

As a result, the following numbers of ordinary shares were issued to the executive officers during fiscal year 2021:

 

 
     FY2018 PSUs  
 
 Named Executive Officer   

Minimum

PSUs

    

Target

PSUs

    

Maximum

PSUs

    

FY2018 PSUs  

Earned  

 

 William D. Mosley

              0        130,480        260,960        254,697    

 Jeffrey D. Nygaard

              0        8,705        17,410        16,993    

 Ban Seng Teh

              0        2,180        4,360        4,256    

The certification of the relevant financial performance metrics with respect to the PSUs granted in fiscal year 2019 to Dr. Mosley and Messrs. Nygaard and Teh, which have a three-year performance period that ended on July 2, 2021 was not completed in advance of the filing date of this Proxy Statement.

 

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Share Ownership Requirements

We established share ownership requirements to ensure that our NEOs hold a meaningful equity stake in the Company and, by doing so, link their interests with those of our shareholders. Shares directly or indirectly owned (for example, through a trust), along with unvested RSUs (if any), are included in the calculation of ordinary shares owned for purposes of the ownership requirements, but time-based and performance-based options and unvested performance share bonuses, TPSUs and PSUs are not counted until they are exercised or vested, as applicable. NEOs are expected to meet the ownership requirements within five years of the date upon which the NEO first becomes subject to the requirements. NEOs are measured against the applicable guideline on the last day of each fiscal year, and the results are reported to the Compensation Committee.

Our NEOs are required to own shares in an amount equal to an applicable target value based on a multiple of annual base salary. Our NEOs are required to meet the requirements by the following ownership requirement dates.

 

 Named Executive Officer    Role    Ownership Requirement Date   

Ownership

Guideline

Salary Multiple

   Guideline
Met
(1)
   

 William D. Mosley

   CEO    October 1, 2022    6x    Yes  

 Gianluca Romano

   Executive Vice President    January 7, 2024    3x    In Progress  

 Jeffrey D. Nygaard

   Executive Vice President    October 17, 2022    3x    Yes  

 Ravi Naik

   Executive Vice President    February 1, 2026    3x    Yes  

 Ban Seng Teh

   Executive Vice President    February 1, 2026    3x    Yes  

 

(1)

As of July 2, 2021

Benefits and Perquisites

Our NEOs are eligible to participate in a broad range of benefits in the same manner as non-executive employees. Seagate does not offer separate benefits for executive officers, other than severance benefits (see “Severance and Change in Control Benefits” below).

We generally do not provide perquisites to our NEOs other than business use of our corporate aircraft and, in certain limited business-related circumstances, reimbursement for the travel costs of the NEO’s spouse or significant other. If an NEO’s travel on our corporate aircraft includes a personal element, the NEO is required to fully reimburse us for the aggregate incremental cost of any such usage. We do consider the value of perquisites, to the extent provided at the Executive Peer Group companies, in assessing the competitiveness of our total compensation package for our NEOs.

Non-Qualified Deferred Compensation Plan

The 2015 Seagate Deferred Compensation Plan (the “SDCP”), effective January 1, 2015, allows our U.S. based NEOs (and other eligible employees) whose annual base salary is $190,000 or more, or whose target commissions and annual base salary in the aggregate is $190,000 or more, to defer on a pre-tax basis (i) up to 70% of their base salary, (ii) up to 70% of commissions, and/or (iii) up to 100% of their annual performance-based cash bonus. Deferrals and notional earnings related to those deferrals are reflected on the Company’s books as an unfunded obligation of the Company and remain part of our general assets. We do not contribute to the SDCP, and notional earnings on deferrals are based on the performance of actual investment funds selected by each participant from a menu of investment options offered pursuant to the SDCP. Deferral amounts, earnings and year-end balances for our NEOs are set forth in the table titled “Non-qualified Deferred Compensation Plans” under the “Compensation of Named Executive Officers”

 

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section below. The SDCP is a successor plan to the prior Seagate Deferred Compensation Plans, as amended from time to time, under which no additional deferrals may be made after December 31, 2014. A grantor (or rabbi) trust was established to hold any assets contributed to the trust to help satisfy our obligations due under the prior plans in effect through December 31, 2014.

Participants may elect to receive distributions upon retirement or termination of employment or at a specified time while still employed. With respect to deferrals of amounts relating to services provided to Seagate after December 31, 2019, participants may elect to receive distributions following retirement or termination in either a lump sum or annual installments up to a maximum of seven years. Participants may elect to receive in-service distributions in a lump sum or annual installments payable over 2, 3, 4 or 5 years. Upon disability, a participant’s account will be distributed in accordance with their retirement/termination distribution elections. Additionally, upon death, a participant’s accounts will be paid to their beneficiary or beneficiaries in a cash lump-sum payment payable before the later of the end of (i) the calendar year in which the participant dies or (ii) two and one-half months after the participant dies. Unless otherwise determined by the Seagate Benefits Administrative Committee prior to a change in control, the SDCP will be terminated upon the occurrence of a change in control and the aggregate balance credited to and held in a participant’s account shall generally be distributed to the participant in a lump sum not later than the thirtieth day following the change in control.

Long Term International (Expatriate) Assignment Policy

The Company’s global business needs require it on occasion to relocate certain employees with special or unique skills to countries where those skills may not be readily available. To meet this need, the Company utilizes long term international assignments, which are provided under its Long-Term International Assignment Policy (“LTIA Policy”). The Company provides certain benefits and allowances to these long-term international assignees according to the LTIA Policy. Mr. Nygaard receives the standard benefits and allowances under the LTIA Policy as described below for his assignment in Thailand. In fiscal year 2021 the Company provided Mr. Nygaard with housing and related support, goods and services in Thailand, education support for his children, and payment for his tax returns preparation in accordance with the LTIA Policy terms. In addition, the Company makes certain tax equalization payments or reimbursements for expatriates to ensure that the assignment is tax neutral to the employee. The Company withholds a hypothetical tax amount for the expatriate in amounts roughly equivalent to the taxes of a peer employee in the relevant country not on assignment under the LTIA Policy. After the expatriate’s actual income tax returns have been prepared, the Company’s accountants prepare a tax equalization calculation to show what the employee should have paid if they had remained at home and not taken the assignment. The employee receives credit for any taxes they have paid during the year, and the Company pays all costs related to the actual taxes due in both the home and host locations. The Company’s tax equalization cost is limited to any difference between the actual taxes paid and the “stay at home” tax the employee would have paid, after calculations are prepared by the Company’s accountants.

The total estimated payments made in fiscal year 2021 for Mr. Nygaard’s benefits under the LTIA Policy is $262,305 as described in note 13 to the Summary Compensation Table for Fiscal Year 2021 in this Proxy Statement. Final actual cost is not known at the time of this filing due to pending tax calculations, which can only be completed at a later date.

 

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Severance and Change in Control Benefits

We provide severance benefits to assist in aligning executive officer and shareholder interests during the evaluation of an ownership change, to remain competitive in attracting and retaining executive officers and to support organizational changes necessary to achieve our business strategy. The purpose of the Seventh Amended and Restated Seagate Technology Executive Severance and Change in Control Plan (the “Severance Plan”) is to:

 

   

provide for the payment of severance benefits to our executive officers, including our NEOs, in the event their employment with the Company or any applicable subsidiary is terminated without cause or they resign for good reason;

 

   

encourage our executive officers, including the NEOs, to continue employment in the event of a potential “change in control” (as such term is defined under “Compensation of Named Executive Officers—Potential Payments upon Qualifying Termination or Change in Control” below); and

 

   

provide our executive officers, including the NEOs, with generally the same types of severance benefits in connection with a qualifying termination of employment.

All of our executive officers receive a level of severance benefits under the terms of the Severance Plan that reflects their level of responsibility within our organization, the strategic importance of their position and a market-competitive level of severance for comparable positions within the Executive Peer Group.

The Severance Plan provisions were developed, in consultation with FW Cook, based on a comparison by the independent directors of the Board of severance benefits typically available at the Executive Peer Group companies. Consistent with our compensation philosophy, the Severance Plan provides for severance only in the event of a qualifying termination under the Severance Plan (i.e., a termination by us without “cause” or by the executive for “good reason”). The Severance Plan includes the following features:

 

   

no guaranteed bonus amounts;

 

   

no post-termination healthcare benefit subsidy if the qualifying termination occurs outside of a “change in control period” (as defined in “Compensation of Named Executive Officers—Potential Payments upon Termination or Change in Control—Termination Without Cause or for Good Reason During a Change in Control Period,” below);

 

   

enhanced severance benefits in connection with a change in control require a “double trigger” (which is defined as a qualifying termination during a “change in control period”) before an NEO becomes entitled to receive such benefits; and

 

   

severance payments cannot equal or exceed three times the sum of the executive’s base salary and target cash bonus.

In the event that the benefits payable following a change in control exceed the safe harbor limits established in Section 280G of the U.S. Internal Revenue Code of 1986, as amended (the “Code”), we will reduce the benefits so that no excise tax will apply under Section 4999 of the Code (relating to Section 280G of the Code), if such reduction will result in a higher after-tax benefit to the NEO. We do not provide a gross-up for any taxes payable on severance benefits and the NEO is responsible for the payment of all such taxes, including any excise taxes imposed on change in control payments and benefits.

 

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For further details on the Severance Plan, see the section below titled “Compensation of Named Executive Officers—Potential Payments Upon Qualifying Termination or Change in Control.”

Other Company Policies and Compensation Considerations

Impact of Section 162(m) of the Internal Revenue Code

Although an exception exists for certain qualified performance-based arrangements in place as of November 2, 2017, under Section 162(m) of the Code, only the first $1 million in annual compensation paid to our NEOs generally is deductible for federal income tax purposes and such deduction limit will continue to apply to such individuals for all future years in which they receive compensation (including severance) from the Company. This deduction limitation also applies to certain individuals who were NEOs in prior years. While the Compensation Committee considers tax deductibility as one of several relevant factors in determining executive compensation, it retains the flexibility to approve compensation that is not deductible by the Company in order to maintain a compensation program that is consistent with our pay-for-performance compensation philosophy.

Securities Trading; Prohibitions Against Hedging and Pledging

Please see the “Corporate Governance – Anti-Hedging and Pledging Policy and Other Trading Restrictions” section above for information on our Securities Trading Policy.

Pay Recovery Policy (Clawback)

Our Pay Recovery Policy is intended to eliminate any reward for intentional misrepresentation of financial results. It provides standards for recovering compensation from our executive officers and other officers who hold the position of Senior Vice President and above (collectively, “Designated Officers”) where such compensation was based on incorrectly reported financial results due to the fraud or willful misconduct of such Designated Officer. The Designated Officer’s repayment obligation applies to any cash bonus paid, share award issued (whether or not vested) and/or vested during the covered period (as defined below) or options exercised during the period commencing with the date that is four years prior to the beginning of the fiscal year in which a restatement is announced, and ending on the date recovery is sought (the “covered period”).

 

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Compensation Committee Report

The Compensation Committee has reviewed and discussed the Compensation Discussion and Analysis with management and the Board. In reliance on the review and discussions referred to above, the Compensation Committee approved the inclusion of the Compensation Discussion and Analysis in the Company’s Proxy Statement for fiscal year 2021.

 

 

Respectfully submitted,

THE COMPENSATION COMMITTEE

 

Mark W. Adams, Chair

Michael R. Cannon

Jay L. Geldmacher

Dylan Haggart

Edward J. Zander

Compensation Committee Interlocks and Insider Participation

None of the members of the Compensation Committee during fiscal year 2021 was an employee of the Company or any of its subsidiaries at any time during fiscal year 2021, has ever been an officer of the Company or any of its subsidiaries, or had a relationship with the Company during that period requiring disclosure pursuant to Item 404(a) of Regulation S-K promulgated by the SEC. No executive officers of the Company served on the compensation committee of any other entity, or as a director of an entity that employed any of the members of the Compensation Committee during fiscal year 2021.

 

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COMPENSATION OF NAMED EXECUTIVE OFFICERS

Our Summary Compensation Table for fiscal year 2021 below shows the total compensation of each of our NEOs with respect to fiscal years 2021, 2020, and 2019. The amounts reported reflect rounding, which may result in slight variations between amounts shown in the Total column and the sum of its components as reflected in the table.

 

Summary Compensation Table for Fiscal Year 2021

 

 

               
Name and Principal Position   Year     

Salary

($)

   

Bonus

($)

   

Share

Awards

($)(1)

   

Option

Awards

($)(1)

   

Non-Equity

Incentive Plan

Compensation

($)(2)

   

All Other

Compensation

($)(3)(4)

   

    Total    

($)

 

    William D. Mosley

               
               

Chief Executive Officer

  2021        1,100,008             7,054,961       1,474,825       2,005,095          6,300              11,641,189  
 

 

2020   

 

 

 

 

1,100,008

 

 

 

 

 

 

 

 

 

 

 

 

7,313,257

 

 

 

 

 

 

1,900,012

 

 

 

 

 

 

1,378,090   

 

 

 

 

 

 

7,400       

 

 

 

 

 

 

11,698,767

 

 

 

 

2019   

 

 

 

 

1,084,623

 

 

 

 

 

 

 

 

 

 

 

 

6,528,382

 

 

 

 

 

 

1,684,831

 

 

 

 

 

 

1,039,343   

 

 

 

 

 

 

7,400       

 

 

 

 

 

 

10,344,579

 

 

    Gianluca Romano

               
               

Executive Vice President and Chief Financial Officer

 

2021   

 

 

600,018

 

 

 

 

 

 

1,633,956

 

 

 

341,566

 

 

 

729,141   

 

 

 

7,400       

 

 

 

3,312,081

 

 

 

2020   

 

 

 

 

600,018

 

 

 

 

 

 

 

 

 

 

 

 

2,032,312

 

 

 

 

 

 

528,001

 

 

 

 

 

 

501,135   

 

 

 

 

 

 

117,210       

 

 

 

 

 

 

3,778,676

 

 

 

 

2019   

 

 

 

 

276,931

 

 

 

 

 

 

200,000

 

(6) 

 

 

 

 

1,060,382

 

 

 

 

 

 

1,213,679

 

 

 

 

 

 

179,631   

 

 

 

 

 

 

53,374       

 

 

 

 

 

 

2,983,997

 

 

    Jeffrey D. Nygaard

               
               

Executive Vice President, Global
Operations

 

2021   

 

 

480,002

 

 

 

 

 

 

1,633,956

 

 

 

341,566

 

 

 

583,298   

 

 

 

283,261       

 

 

 

3,322,083

 

 

 

2020   

 

 

 

 

480,002

 

 

 

 

 

 

 

 

 

 

 

 

2,032,312

 

 

 

 

 

 

528,001

 

 

 

 

 

 

400,897   

 

 

 

 

 

 

496,256       

 

 

 

 

 

 

3,937,468

 

 

 

 

2019   

 

 

 

 

472,312

 

 

 

 

 

 

 

 

 

 

 

 

3,072,223

 

 

 

 

 

 

792,869

 

 

 

 

 

 

302,353   

 

 

 

 

 

 

450,833       

 

 

 

 

 

 

5,090,590

 

 

    Ravi Naik(5)

               
               

Executive Vice President, Storage Services
and Chief Information Officer

 

2021   

 

 

442,318

 

 

 

 

 

 

1,698,875

 

 

 

777,542

 

 

 

571,165   

 

 

 

7,790       

 

 

 

3,497,690

 

    Ban Seng Teh(5)(7)

               
               

Executive Vice President, Global
Sales and Sales Operations

 

2021   

 

 

500,170

 

 

 

 

 

 

1,312,067

 

 

 

485,877

 

 

 

519,471   

 

 

 

18,040       

 

 

 

2,835,625

 

 

 

2020   

 

 

 

 

496,343

 

 

 

 

 

 

 

 

 

 

 

 

788,081

 

 

 

 

 

 

 

 

 

 

 

 

112,272   

 

 

 

 

 

 

37,117       

 

 

 

 

 

 

1,433,813

 

 

 

(1)

Amounts do not reflect the actual value realized by the NEO. In accordance with SEC rules, the columns represent the aggregate grant date fair value calculated in accordance with ASC 718, excluding the effect of estimated forfeitures. For RSUs and time-based options, the grant date fair value was determined using the closing share price of Seagate ordinary shares on the date of grant, adjusted for the present value of expected dividends. For all PSUs and TPSUs whose vesting is subject to performance conditions as defined by ASC 718, we have assumed the probable outcome of related performance conditions at target levels. The aggregate grant-date fair value for these PSUs and TPSUs, assuming the achievement of the highest level of performance, is $11,566,553 for Dr. Mosley, $2,678,748 for each of Messrs. Romano and Nygaard, $1,359,315 for Mr. Naik and $1,006,300 for Mr. Teh. For additional information on the valuation assumptions, see Note 11, “Share-Based Compensation” in the Notes to the Consolidated Financial Statements in the Company’s Annual Report on Form 10-K for fiscal year 2021.

(2)

Represents amounts payable under the EOPB. For a description of the EOPB, refer to the section above entitled “Annual Incentive Plan—Executive Officer Performance Bonus.”

(3)

Amounts reported in the All Other Compensation column are itemized in the supplemental “All Other Compensation for Fiscal Year 2021” table below.

 

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          2021 Proxy Statement

 


Table of Contents

 

 

 2021 NOTICE OF MEETING AND PROXY STATEMENT

 

 

All Other Compensation for Fiscal Year 2021

 

                     
 Name  

Severance   

($)   

 

Relocation   

($)   

 

Relocation  

Tax  

Assistance  

($)  

 

Personal  

Guest  

Travel  

($)(8)   

 

401(k)  

Match  

($)(9)  

 

Company  

Contribution  

to HSA  

($)(10)  

 

Company  

Contribution  

to CPF  

($)(11)  

 

  Other  

  Comp  

  ($)  

 

International  

Assignment  

Benefits  

($)(13)  

 

Consultant  

Payments  

($)  

 

    Total    

($)  

 
                     

 William D. Mosley

          6,000       300(12)         6,300  
                     

 Gianluca Romano

          6,000   1,400             7,400  
                     

 Jeffrey D. Nygaard

        14,956   6,000         262,305       283,261  
                     

 Ravi Naik

          6,390   1,400             7,790  
                     

 Ban Seng Teh

        7,111       10,929           18,040  
(4)

We provide the use of our corporate aircraft to our NEOs primarily so that they can travel to business functions and different facilities in the course of their duties. Certain trips taken by our NEOs in fiscal year 2021 may have had a personal element. To the extent that a travel leg has a personal element to it, our NEOs fully reimburse the Company for the aggregate incremental cost of such leg to us. Such reimbursement includes the costs of “wheels up time”, a portion of fuel and insurance costs, catering, excise taxes, and crew expenses.

(5)

Mr. Naik was not an NEO in fiscal years 2019 and 2020, and Mr. Teh was not an NEO in fiscal year 2019.

(6)

Represents the one-time sign-on bonus amount paid to Mr. Romano in connection with his appointment as Executive Vice President and Chief Financial Officer.

(7)

Based on the Singapore dollar (“SGD”) period-end foreign exchange rate for fiscal year 2021 of 0.7434.

(8)

For Mr. Nygaard, personal guest travel consists of travel costs incurred for his spouse to attend an R&D-related event. For Mr. Teh, personal guest travel consists of travel costs incurred for his spouse in connection with a sales incentive program offered to eligible sales employees who achieve designated sales goals.

(9)

Reflects 401(k) Plan matching contribution made by the Company for the NEO and available to all U.S. employees who participate in the 401(k) Plan. The maximum matching amount was $6,000 per calendar year. The amount may be higher or lower for a particular fiscal year depending on the timing and amount of the employee’s contribution for preceding and following years.

(10)

Reflects Company-paid Health Savings Account (“HSA”) contributions to eligible participants. In 2021, HSA contributions are $700.00 for employee only coverage and $1,400.00 for family coverage.

(11)

Reflects Company contribution to the Singapore Central Provident Fund (“CPF”). CPF employer contribution was at SGD1,020 per month until December 2020. As of January 2021, Mr. Teh reached a new age bracket where the CPF employer contribution is now SGD780 per month with an additional employer contribution capped at SGD3,900 per year.

(12)

Dr. Mosley was awarded a cash-based service award in the amount of $300 in recognition of reaching a length of service milestone with the Company.

(13)

Mr. Nygaard’s LTIA benefits include payments made in fiscal year 2021 for expatriate tax and tax equalization for year to date 2021, remaining expatriate tax and tax equalization owed for 2020 in the amount of $36,730, a cost of living allowance in the amount of $63,906, educational payments in the amount of $51,662; host location housing in the amount of $60,035, transportation expenses in the amount of $48,641, telephone expense in the amount of $231, and immigration and tax services in the amount of $1,100. As described more fully in the section entitled “Compensation Discussion and Analysis—Long Term International (Expatriate) Assignment Policy,” the tax equalization payments are intended to ensure that the long-term international assignment is tax neutral to Mr. Nygaard as compared to being based in the U.S.

 

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Table of Contents

 

 

 2021 NOTICE OF MEETING AND PROXY STATEMENT

 

 

Grants of Plan-Based Awards Table for Fiscal Year 2021

 

                

Estimated Future

Payouts Under

Non-Equity Incentive

Plan Awards(1)

   

Estimated Future Payouts

Under Equity Incentive Plan

Awards

                         
                       
Name   Type of
Award
   

Grant

Date

   

Threshold

($)

   

Target

($)

   

Maximum

($)

   

Threshold

(#)

   

Target

(#)

   

Maximum

(#)

   

All Other

Share

Awards:

Number

of Shares

or Units

(#)

   

All Other

Option

Awards:

Number of

Securities

Underlying

Options

(#)

   

Exercise

or Base

Price of

Option

Awards

($/

Share)

   

Grant

Date Fair

Value of

Share

and

Option

Awards

($)

 

William D. Mosley

                       
 

 

Cash Bonus

 

 

 

 

 

 

825,006

 

 

 

1,650,012

 

 

 

3,300,024

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Time Option

 

 

 

9/9/2020(2)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

167,100

 

 

 

46.23

 

 

 

1,474,825    

 

 

 

PSU

 

 

 

9/9/2020(3)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

104,435

 

 

 

208,870

 

 

 

 

 

 

 

 

 

 

 

 

4,511,592(5)

 

 

 

TPSU

 

 

 

9/9/2020(4)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

62,660

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2,543,369(5)

 

Gianluca Romano

                       
 

 

Cash Bonus

 

 

 

 

 

 

300,009

 

 

 

600,018

 

 

 

1,200,035

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Time Option

 

 

 

9/9/2020(2)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

38,700

 

 

 

46.23

 

 

 

341,566    

 

 

 

PSU

 

 

 

9/9/2020(3)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

24,185

 

 

 

48,370

 

 

 

 

 

 

 

 

 

 

 

 

1,044,792(5)

 

 

 

TPSU

 

 

 

9/9/2020(4)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

14,515

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

589,164(5)

 

Jeffrey D. Nygaard

                       
 

 

Cash Bonus

 

 

 

 

 

 

240,001

 

 

 

480,002

 

 

 

960,003

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Time Option

 

 

 

9/9/2020(2)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

38,700

 

 

 

46.23

 

 

 

341,566    

 

 

PSU

 

 

 

9/9/2020(3)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

24,185

 

 

 

48,370

 

 

 

 

 

 

 

 

 

 

 

 

1,044,792(5)

 

 

 

TPSU

 

 

 

9/9/2020(4)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

14,515

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

589,164(5)

 

Ravi Naik

                       
 

 

Cash Bonus

 

 

 

 

 

 

235,009

 

 

 

470,018

 

 

 

940,035

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Time Option

 

 

 

3/22/2021(2)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

45,000

 

 

 

75.94

 

 

 

777,542    

 

 

 

PSU

 

 

 

9/9/2020(3)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

6,600

 

 

 

13,200

 

 

 

 

 

 

 

 

 

 

 

 

285,120(5)

 

 

 

TPSU

 

 

 

3/22/2021(4)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

11,250

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

789,075(5)

 

 

 

RSU

 

 

 

9/9/2020(6)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

15,390

 

 

 

 

 

 

 

 

 

624,680    

 

Ban Seng Teh

                       
 

 

Cash Bonus

 

 

 

 

 

 

213,739

 

 

 

427,477

 

 

 

854,955

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Time Option

 

 

 

3/22/2021(2)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

28,120

 

 

 

75.94

 

 

 

485,877    

 

 

 

PSU

 

 

 

9/9/2020(3)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

5,940

 

 

 

11,880

 

 

 

 

 

 

 

 

 

 

 

 

256,608(5)

 

 

 

TPSU

 

 

 

3/22/2021(4)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

7,030

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

493,084(5)

 

   

 

RSU

 

 

 

9/9/2020(6)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

13,855

 

 

 

 

 

 

 

 

 

562,374    

 

 

(1)

Represents the potential range of payments for fiscal year 2021 for the NEOs under the EOPB. This range varied based on the individual’s position and target cash bonus as a percentage of fiscal year 2021 ending base salary (150% percent of base salary for Dr. Mosley, 100% for Messrs. Romano, Nygaard, Naik and Teh). For a description of the EOPB, refer to the section above entitled “Annual Incentive Plan—Executive Officer Performance Bonus.”

(2)

Unless otherwise indicated, options awarded during fiscal year 2021 under the EIP are subject to a four-year vesting schedule. 25% of the shares subject to the option vest one year after the grant date and then 1/48th of the shares subject to options vest monthly thereafter, contingent on continuous service through the applicable vesting dates. For a description of the options, refer to the section entitled “Compensation Discussion and Analysis—Long-Term Equity Incentives—Options.”

(3)

Unless otherwise indicated, PSUs awarded during fiscal year 2021 under the EIP vest after the end of a three-year performance period, subject to both continuous service and the achievement of the applicable financial and operational-performance criteria. For a description of the PSUs, refer to the section entitled “Compensation Discussion and Analysis—Long-Term Equity Incentives—Share Awards—Performance Share Units.”

(4)

Unless otherwise indicated, the vesting of the TPSUs awarded during fiscal year 2021 under the EIP is contingent on continuous service and satisfaction of the performance vesting requirement. The first tranche vests no sooner than the first anniversary of the vesting commencement date, subject to the satisfaction of the specified performance criterion. The remaining tranches continue to vest annually thereafter subject to the achievement of the subsequent annual AEPS goal, with the ability to catch-up vesting each year if the annual AEPS goal is not achieved. If threshold AEPS is not achieved, no awards will vest and the shares will be forfeited at the end of the performance period. For a description of the TPSUs, refer to the section entitled “Compensation Discussion and Analysis—Long-Term Equity Incentives—Share Awards—Threshold Performance Share Units.”

(5)

In accordance with SEC rules, this represents the aggregate grant date fair value calculated in accordance with ASC 718, excluding the effect of estimated forfeitures. For all TPSUs and PSUs, we have assumed the probable outcome of related performance conditions as defined by ASC

 

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Table of Contents

 

 

 2021 NOTICE OF MEETING AND PROXY STATEMENT

 

 

  718 at target levels. The total aggregate grant-date fair value for these PSUs and TPSUs, assuming the achievement of the highest level of performance, is $11,566,553 for Dr. Mosley, $2,678,748 for each of Messrs. Romano and Nygaard, $1,359,315 for Mr. Naik and $1,006,300 for Mr. Teh. For additional information on the valuation assumptions see Note 11, “Share-Based Compensation” in the Notes to the Consolidated Financial Statements in the Company’s Annual Report on Form 10-K for fiscal year 2021.
(6)

Unless otherwise indicated, RSUs awarded during fiscal year 2021 under the EIP are subject to a four-year vesting schedule. These units vest 25% annually, contingent on continuous service. For a description of the RSUs, refer to the section entitled “Compensation Discussion and Analysis—Long-Term Equity Incentives—Share Awards—Restricted Share Units.”

 

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          2021 Proxy Statement

 


Table of Contents

 

 

 2021 NOTICE OF MEETING AND PROXY STATEMENT

 

 

Outstanding Equity Awards at 2021 Fiscal Year-End

 

         

Option Awards

 

   

Share Awards

 

 

        Name

 

 

Grant Date

 

   

Number of   

Securities   

Underlying   

Unexercised   

Options   

Exercisable(1)   

(#)   

 

 

Number of   

Securities   

Underlying   

Unexercised   

Options   

Unexercisable(1)   

(#)   

 

 

Equity   

Incentive   

Plan   

Awards:   

Number of   

Securities   

Underlying   

Unexercised   

Unearned   

Options(1)   

(#)   

 

 

Option   

Exercise   

Price   

($)   

 

 

Option

Expiration

Date

 

   

Number of

Shares

That

Have Not

Vested

(#)

 

 

Market
Value of
Shares
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)

 

 

  William D. Mosley

   
                 

 

 

 

9/9/2014

 

 

31,500

 

 

 

60.83

 

 

9/9/2021

 

 

 

 

 

 

 

 

 

                 

 

 

 

9/9/2016

 

 

198,860

 

 

 

36.09

 

 

9/9/2023

 

 

 

 

 

 

 

 

 

                 

 

 

 

9/11/2017

 

 

237,363

 

15,825

 

 

30.95

 

 

9/11/2024

 

 

 

 

 

 

 

 

 

                 

 

 

 

9/11/2017

 

 

 

 

 

 

 

 

 

 

 

 

16,842

(3) 

 

 

1,465,759

 

                 

 

 

 

9/10/2018

 

 

97,477

 

44,308

 

 

50.29

 

 

9/10/2025

 

 

 

 

 

 

 

 

 

                 

 

 

 

9/10/2018