DEF 14A of Science Applications International Corp
Filed Apr 23, 2025 · FY20250001571123-25-000090
TABLE OF CONTENTS
| Executive Compensation | Executive Compensation | 56 | | | Summary Compensation Table | 57 | | | Grants of Plan-Based Awards | 58 | | | Outstanding Equity Awards at Fiscal Year-End | 59 | | | Options Exercised and Stock Vested | 60 | | | Nonqualified Deferred Compensation | 60 | | | Potential Payments upon Termination or a Change in Control | 61 | | | CEO Pay Ratio | 66 | | | Pay Versus Performance | 66 | | Proposal 3 | Proposal 3 - Ratification of Appointment of Independent Registered Public Accounting Firm | 71 | | | Vote Required | 72 | | | Recommendation of the Board | 72 | | Audit Matters | Audit Matters | 73 | | | Audit Committee Report | 74 | | | Independent Registered Public Accounting Firm | 74 | | | Audit and Non-Audit Fees | 75 | | Other Information | Other Information | 76 | | | Stock Ownership of Certain Beneficial Owners | 77 | | | Stock Ownership of Directors and Officers | 78 | | | Delinquent Section 16(a) Reports | 78 | | | Stockholder Proposals and Director Nominations for the 2025 Annual Meeting | 79 | | | Annual Report on Form 10-K | 79 | | | Appendices | 80 | | | Appendix A: Non-GAAP Financial Measures | 81 |
ELECTION OF DIRECTORS
ELECTION OF DIRECTORS The Board unanimously recommends a vote FOR each nominee. At the annual meeting, eleven directors are to be elected to serve for one-year terms and to hold such position until each director’s successor is elected and qualified unless any of the directors resign or are removed prior to the end of their respective term. All nominees have been nominated by the Board based on the recommendation of the Nominating and Corporate Governance Committee thereof. To the best knowledge of the Board, all of the nominees are able and willing to serve. Each nominee has consented to be named in this Proxy Statement and to serve if elected. Each nominee listed below is currently a director of the company and, other than Mr. Tien, each was elected by the stockholders at our 2024 annual meeting of stockholders. Mr. Tien was elected to serve as a director by the Board effective as of December 2, 2024, and is standing for election by our stockholders as a director of the company for the first time at this year’s annual meeting. Mr. Tien was first identified as a potential director candidate by one of our current non-executive directors. The candidate went through the company's rigorous vetting process, including full background checks, and was selected based on his excellent credentials and financial acumen. Mr. Tien was then evaluated by the Nominating and Corporate Governance Committee in advance of its recommendation of his service as a director. Majority Voting Standard in Uncontested Director Elections We have adopted majority voting procedures for the election of directors in uncontested elections. In an uncontested election, nominees must receive more “for” than “against” votes to be elected without further action. Abstentions and broker non-votes are not counted as votes cast. As provided in our bylaws, a “contested election” is one in which the number of nominees exceeds the number of directors to be elected. The election of directors at the 2025 annual meeting of stockholders is an uncontested election. If an incumbent director receives more “against” than “for” votes, he or she is expected to tender his or her resignation in accordance with our Corporate Governance Guidelines. The Nominating and Corporate Governance Committee will consider the offer of resignation and recommend to the Board the action to be taken. The Board will promptly disclose its decision as to whether to accept or reject the tendered resignation in a press release, Current Report on Form 8-K or other public announcement. Shares of common stock represented by properly executed, timely received and unrevoked proxies will be voted as instructed in the proxy. In the absence of specific instructions, the shares represented by properly executed, timely received and unrevoked proxies will be voted “for” each nominee. If any of the nominees listed below becomes unable to stand for election at the annual meeting, the proxy holders intend to vote for any person designated by the Board to replace the nominee unable to serve. Recommendation of the Board of Directors The Board unanimously recommends a vote FOR each nominee. Nominees for Election to the Board of Directors Set forth below is a brief biography of each nominee for election as a director and a brief discussion of the specific experience, qualifications, attributes or skills that led to the Board’s conclusion that the nominee should serve as a director of our company. The Board evaluates each individual in the context of the Board as a whole, with the objective of recommending to stockholders a group of nominees with complementary skills and a diverse mix of backgrounds, perspectives and expertise beneficial to the broad business diversity of the company. Our board membership criteria and director nomination process are described in the “Corporate Governance” section of this Proxy Statement.
Dr. Garth N. Graham
Dr. Garth N. Graham
Dr. Garth N. Graham
| | Select Qualifications and Skills: Leadership and Executive Management Experience: Since January 2021, Dr. Graham has served as the Director and Global Head of Healthcare for YouTube, LLC, an online video-sharing platform and subsidiary of Alphabet Inc. (Nasdaq: GOOGL). From 2019 until 2021, Dr. Graham served as the Chief Community Health Officer for CVS Health Corporation (NYSE: CVS), a diversified health services company, and from 2013 until 2019, he served in various roles for Aetna Inc., a health insurance company, including as the President of the Aetna Foundation and the Vice President for Community Health. In April 2021, Dr. Graham became a member of the Board of Directors for Modivcare Inc. (Nasdaq: MODV), a technology-enabled healthcare services company. Healthcare and Industry Expertise: Dr. Graham holds a medical degree from Yale School of Medicine, and a Master of Public Health from Yale School of Public Health. A cardiologist and professor of medicine, he was Deputy Assistant Secretary to the U.S. Health and Human Services Department under Presidents Barack Obama and George W. Bush, in addition he led the Office of Minority Health and the federal government’s first National Health Disparities Plan. An elected member of the National Academy of Medicine, he contributes to several boards including the Institute of Medicine Board on Population Health, the National Quality Forum, and the National Heart, Lung, and Blood Institute Advisory Council. The Board believes that Dr. Graham’s extensive healthcare expertise and leadership qualifications in various senior roles within the healthcare arena provides a unique and dynamic skill set to the Board. | | Age: 50 Director since: 2021 Independent Committees: Compensation; Technology | |
Carolyn B. Handlon
Carolyn B. Handlon
Carolyn B. Handlon
| | Select Qualifications and Skills: Leadership and Executive Management Experience: Served in various financial leadership roles for over 35 years, including 17 years as Executive Vice President, Finance and Treasurer, with Marriott International, Inc. Prior to joining Marriott, Ms. Handlon worked for the Overseas Private Investment Corporation and for the Continental Illinois National Bank and Trust. Financial Expertise: Over 40 years of financial experience in the areas of global capital markets, global investment and real estate lending, financial strategy and risk management, global cash operations, mergers and acquisitions, and corporate finance. Director Experience: Ms. Handlon currently serves on the Board of Directors for Invesco Mortgage Capital and Apple Hospitality REIT, Inc. (Nasdaq: APLE). Ms. Handlon's extensive background in the financial and global market industry along with her senior leadership experience provide significant value to our Board. | | Age: 67 Director since: 2022 Independent Committees: Audit; Nominating | |
Yvette M. Kanouff
Yvette M. Kanouff
Yvette M. Kanouff
| | Select Qualifications and Skills: Leadership Experience: Currently serves as a Partner for JC2 Ventures, a Silicon Valley based venture capital firm. Prior to her current role, Ms. Kanouff served from 2014 to 2019 as the Senior Vice President and General Manager for the service provider business line of Cisco Systems, Inc., a global leader in information technology, networking and cybersecurity solutions. Prior to her role with Cisco, from 2012 to 2014, Ms. Kanouff served as Executive Vice President of Engineering and Technology for Cablevision Systems Corporation, a cable television provider and multiple system operator, and from 2010 to 2012, served as President of SeaChange International, a video management solutions provider. Director Experience: Ms. Kanouff has served on the Board of Directors for Entegris, which manufactures and supplies microcontamination control products, specialty chemicals, and advanced materials handling solutions for manufacturing processes in the semiconductor and other high-technology industries, since 2021. She has served on the board of Sprinklr, a firm that develops software for customer experience management, since 2018, and Amdocs, a software and services provider to communications and media companies, since 2020. Ms. Kanouff also serves on boards of private companies as a part of her role at JC2 Ventures. Ms. Kanouff holds a Corporate Board Certificate from Harvard Business School. The Board believes that Ms. Kanouff’s diverse background in the technology industry, with over 25 years of extensive leadership positions and experience, combined with a solid strategy and investment background, provide great insight and value to our Board. | | Age: 59 Director since: 2019 Independent Committees: Audit; Technology (Chair) | |
Timothy J. Mayopoulos
Timothy J. Mayopoulos
Timothy J. Mayopoulos
| | Select Qualifications and Skills: Leadership Experience: Previously served as President and Chief Executive Officer of the Federal National Mortgage Association, known as Fannie Mae, from June 2012 until October 2018. Appointed by the FDIC following the failure of Silicon Valley Bank. N.A, to serve as President and Chief Executive Officer of Silicon Valley Bridge Bank, N.A for a period of weeks in March 2023. Served as President of Blend Labs, Inc., a Silicon Valley enterprise software company, from April 2019 until March 2023. Executive Management and Legal Expertise: In addition to his recent executive leadership roles as President of Blend Labs and President and CEO of Fannie Mae, Mr. Mayopoulos was Chief Administrative Officer of Fannie Mae from 2010 to 2012, and General Counsel and Corporate Secretary of Fannie Mae from 2009 to 2012. Prior to joining Fannie Mae, he was Executive Vice President and General Counsel of Bank of America Corporation. Financial Expertise: Mr. Mayopoulos has held executive leadership roles in financial institutions that have required significant financial expertise and capital markets knowledge. He also serves on the Credit Risk and Finance Committee, previously served on the Audit Committee and Chairs the Operational Risk Committee of the Board of Directors of LendingClub Corporation, a fintech marketplace bank..In addition, Mr. Mayopoulos possesses extensive venture capital experience through his private company board service. Director Expertise: In addition to Mr. Mayopoulos' service as a member of the Board of Directors for LendingClub Corporation, he also serves on the Board of Directors for Blend Labs, Inc., a digital lending platform, and the Board of Directors for Valon Technologies, Inc., a digital mortgage servicing company, and Bilt Technologies, a payments and credit card company. Mr. Mayopoulos has over 30 years of professional experience. His valuable contributions to our Board include his executive management experience, his experience in finance and capital markets, his legal background and his experience operating in highly regulated businesses. | | Age: 66 Director since: 2015 Independent Committees: Audit; Compensation; Nominating | |
Katharina G. McFarland
Katharina G. McFarland
Katharina G. McFarland
| | Select Qualifications and Skills: Leadership Experience: With over 30 years of government service, Katharina McFarland is widely recognized as a leading subject-matter expert on government procurement, science and technology (as Co-Chair of the Army Science Board and prior Chair of the Board of Army Research and Development at the National Academies of Science), IT, cyber, and AI as Commissioner of the National Security Commission on Artificial Intelligence, and Procurement as a Director on the Procurement Round Table. She also serves as a member of the NASA Aerospace Safety Advisory Council. Ms. McFarland was previously the Assistant Secretary of Defense for Acquisition (2012 to 2017) and acting Assistant Secretary of the Army (Acquisition, Logistics & Technology) (2016 to 2017). She was President of the Defense Acquisition University from 2010 to 2012. From 2006 to 2010, Ms. McFarland was the Director of Acquisition, Missile Defense Agency. Director Experience: Ms. McFarland has extensive public and private Board experience and served as a Director for Engility from 2017 to January 2019. She has served on the Board of Directors for Transphorm Inc. from January 2021 to July 2024, and served on the Board of Directors for Virgin Orbit from November 2021 to August 2023. In addition, Ms. McFarland has served on a number of various advisory boards and council positions, including those at Rafael Systems Global Sustainment Group, Skylo, and Gambit. Ms. McFarland brings substantial experience in defense acquisition, program management, logistics and technology. In particular, her experience with the U.S. Department of Defense, Department of the Army, and Intelligence Community procurement provides valuable insight to the Board. | | Age: 65 Director since: 2019 Independent Committees: Nominating (Chair); Technology | |
Milford W. McGuirt
Milford W. McGuirt
Milford W. McGuirt
| | Select Qualifications and Skills: Leadership and Executive Management Experience: Served as Managing Partner of the Atlanta office and Mid-South Area of KPMG from January 2015 until his retirement in September 2019. During a 33-year career at KPMG, Mr. McGuirt held a number of leadership positions, including as a senior partner and the National Audit Sector Leader and National Industry Leader for the firm’s higher education practice. Prior to joining KPMG, Mr. McGuirt served as an audit manager with Coopers & Lybrand. Financial Expertise: Over 41 years of financial experience in the areas of public accounting and auditing with Big 4 international and consulting firms, including 29 years as a Partner at KPMG. Director Experience: Mr. McGuirt served on the board of HD Supply as an independent director and member of the audit and nominating and corporate governance committee from July to December of 2020, and currently serves on the board of Oxford Industries, Inc. since July of 2020, and private company Chick-fil-A, Inc. since October 2021. In addition, Mr. McGuirt also previously served on KPMG’s Nominating Committee of the Board of Directors as well as the KPMG Diversity Advisory Board and KPMG Foundation. Mr. McGuirt’s decades of extensive experience in the financial industry, specifically in the accounting and auditing fields, as well as over 30 years of leadership roles, make him a great asset to the Board and his financial insight will be greatly beneficial to our company. | | Age: 68 Director since: 2021 Independent Committees: Audit (Chair); Nominating | |
Donna S. Morea
Donna S. Morea
Donna S. Morea
| | Select Qualifications and Skills: Leadership and Executive Management Experience: Served as President of CGI Technology and Solutions, Inc. ("CGI"), a wholly-owned U.S. subsidiary of CGI Group, one of the largest independent information technology firms in North America, from May 2004 until her retirement at the end of 2011. Ms. Morea also served as a Director for CGI from February 2012 to May 2013. Ms. Morea currently serves on the Board of Directors of Truist (NYSE:TFC) and is an Operating Executive of The Carlyle Group, where she focuses on technology and business services. Ms. Morea is also a member of the Advisory Board of Blue Delta Capital Partners Industry Knowledge and Experience: Information and Technology Expertise: Over 30 years of experience; nationally recognized executive in IT professional services management; and led CGI’s IT and business process services in the U.S., EMEA and Asia Pacific for large enterprises in financial services, healthcare, telecommunications and government. Director Experience: Ms. Morea served as a member of the Board of Directors of SunTrust Banks, Inc. from 2012 until December 2019 and Truist Financial Corp. since December 2019. She also served on the Board of KLDiscovery Inc. from April 2016 until June 2023. Ms. Morea also serves on the boards of Carlyle portfolio companies. The Board believes that Ms. Morea’s executive management experience and information technology expertise provide valuable leadership experience and market knowledge of a significant segment of our business. | | Age: 70 Director since: 2013 Independent Chair of the Board Committees: Compensation; Nominating | |
James C. Reagan
James C. Reagan
James C. Reagan
| | Select Qualifications and Skills: Leadership and Executive Management Experience: Served as Executive Vice President & Chief Financial Officer for Leidos Holdings, Inc. ("Leidos") from July 2015 until his retirement in June 2021. Prior to joining Leidos, Mr. Reagan served as Chief Financial Officer for several organizations including Vencore, Inc., a defense contractor serving the Intelligence Community and Department of Defense, and at PAE, Inc. Mr. Reagan was also the CFO of Aspect Communications until 2005 and held several senior roles at MCI Telecommunications. Industry Knowledge and Experience: Over 18 years of experience in the government services industry across a vast set of areas including cybersecurity and intelligence, information technology and healthcare, and national security. Mr. Reagan also possesses expertise in software, telecommunications, and real estate. Financial Expertise: Over 40 years of experience as a financial leader across a diverse set of industries with extensive experience in transactional mergers and acquisitions and business process optimization to drive shareholder growth. He has been a licensed CPA in the Commonwealth of Virginia since 1982. The Board believes that Mr. Reagan’s financial expertise and his deep knowledge and experience in the government services market gained through decades of serving major companies in our industry provide important contributions to the Board. | | Age: 66 Director since: 2023 Independent Committees: Audit; Compensation | |
Steven R. Shane
Steven R. Shane
Steven R. Shane
| | Select Qualifications and Skills: Leadership: Served as a Partner of Accenture plc ("Accenture"), a management consulting, technology and outsourcing services firm, until his retirement in 2011 after a 30-year career. Financial Expertise and Industry Experience: Consulting and Technology Systems: While at Accenture, Mr. Shane was the Managing Partner of the North America Public Service business responsible for Accenture’s U.S. federal, state and local and Canadian federal and provincial business. He also held several other senior management positions, including those where he led consulting engagements for many of the largest banking institutions in the United States. Following his retirement from Accenture in 2011, Mr. Shane joined LH&P, LLC ("LH&P"), a boutique consulting company, where he currently serves as a consultant and provides strategic, organizational and business advice to senior executives in some of the largest U.S. financial services companies. Director Experience: Mr. Shane previously served on the Board of Directors for ZPower, LLC, a battery technology company, from 2003 until his voluntary retirement in 2019. Mr. Shane has served, since 2013, as an advisor on the Maximus Federal Services Board, an outsourcing company that provides business process services to government health and human services agencies until his voluntary retirement in the fall of 2022. He also served as a Director for Dispersive Networks, LLC, a virtual network solutions provider, from 2014 until his voluntary retirement in January 2020. The Board believes that Mr. Shane’s expertise in financial matters and the implementation of significant, mission-critical technology systems for the U.S. government as well as state and local governments offer perspectives that our Board considers valuable to us as a leading provider of technical, engineering and enterprise information technology services to government customers. | | Age: 67 Director since: 2013 Independent Committees: Compensation (Chair); Technology | |
Steven R. Shane
John K. Tien, Jr.
Steven R. Shane
| | Select Qualifications and Skills: Leadership Experience: Mr. Tien has extensive leadership experience in the U.S. Federal Government, U.S. military, private sector, and the non-profit sector. His most recent role was as the Senate confirmed Deputy Secretary of the U.S. Department of Homeland Security (DHS) in the Biden Administration from June 2021 to July 2023, the second highest-ranking official in DHS. Prior to then, from 2011 to 2021, Mr. Tien was a senior executive in Citigroup, leading teams in various senior leadership up through managing director. From 2020-20121 he served as Head of Business and Process Re-Engineering Transformation for Citigroup’s entire U.S. Consumer Bank, from 2016-2020 served Chief Operating Officer (COO) and Chief Technology Officer (CTO) for the Macy’s private label and co-brand (American Express) credit card portfolio, as well as various leadership positions throughout the company from 2011-2016. Industry Knowledge and Expertise: Mr. Tien is a graduate of West Point Military Academy and served in the U.S. Army for 24 years as an active-duty officer in a variety of leadership and staff positions in seven different U.S. states, three countries, and three combat tours. He retired at the rank of Colonel. Mr. Tien also served in three other presidential Administrations as an active-duty U.S. Army officer: 1) the Obama Administration National Security Council (NSC) Senior Director for Afghanistan and Pakistan; (2) the Bush Administration NSC Director for Iraq; and (3) the Clinton Administration White House Fellow for the U.S. Trade Representative. During his service both in the Army as well as the U.S. government he gained extensive expertise and knowledge in the federal and military landscape. Director Experience: Mr. Tien has served on the Board for Union Pacific (NYSE: UNP) since 2023. Given Mr. Tien's extensive background and expert knowledge spanning the federal, private, and military sectors, coupled with his experience in senior leadership positions, he offers invaluable insights to our Board. | | Age: 61 Director since: 2024 Independent Committees: Nominating | |
Toni Townes-Whitley
Toni Townes-Whitley
Toni Townes-Whitley
| | Select Qualifications and Skills: Leadership and Executive Management Experience: Serves as our Chief Executive Officer and a Director since 2023. Previously served as President, U.S. Regulated Industries for the Microsoft Corporation, an international technology company, from July 2018 until September 2021, and as Industry Corporate Vice President from 2015 until July 2018. Prior to joining Microsoft, Ms. Townes-Whitley was the President for CGI Federal, part of CGI Group, Inc. (CGI), an international information technology and business consulting services firm, from 2011 until 2015, and Vice President, Core Agencies from 2010 until 2011. Prior to her leadership at CGI, Ms. Townes-Whitley served in various leadership roles with Unisys Corporation, a global technology solutions company, from 2002 until 2009, leading global and commercial-sector system integration and the Federal Civilian group, as well as with Arthur Andersen LLP, a former accounting firm, from 1991 until 2002. Director Experience: Since 2021, Ms. Townes-Whitley has served as a member of the Board of Directors for Nasdaq, Inc. (Nasdaq: NDAQ). From January 2019 until June 2023, she served on the Board of Directors for PNC Financial Services Group, Inc. (NYSE: PNC), and from March until June 2023 and March until May 2023 for Marathon Petroleum Corporation (NYSE: MPC) and Granicus, respectively. Ms. Townes-Whitley serves as a Director/Trustee for Thurgood Marshall College Fund, Partnership for Public Service, and the Princeton Faith & Work Initiative. She is a guest lecturer on technology ethics and entrepreneurism in the public sector at Stanford and Princeton Universities. Industry Knowledge and Experience: Over 30 years of experience in the information systems and commercial services industry, with 20 years in executive and senior management positions. Ms. Townes-Whitley has a distinguished and proven track record of driving strong enterprise financial results and fostering an inclusive culture focused on entrepreneurship and high performance. In her past role at Microsoft, she led the company’s public sector and regulated commercial industries including education, financial services, government, and healthcare, managing $16 billion of annual revenue. While with CGI Federal, she was responsible for a portfolio of more than $1 billion, leading 6,600 employees to deliver greater value to US Government civilian, defense, and intelligence sectors. She earned her bachelor's degree in Public Policy and Economics from Princeton University’s School of Public & International Affairs and has received certifications from Wharton Executive Education, New York University, and the Performance Management Institute. The Board believes that Ms. Townes-Whitley extensive market knowledge, leadership skills and management ability proven throughout her executive roles make her highly qualified to serve on our Board. In addition, our Board believes that the company’s Chief Executive Officer should serve on the Board of Directors to help communicate the Board’s priorities to management as well as bring management’s perspective on matters considered by the Board. | | Age: 61 Director since: 2023 Chief Executive Officer Committee: Technology | |
Toni Townes-Whitley
Director Skills and Qualifications The table below summarizes some of the key skills and expertise of our director nominees. This summary is not intended to be an exhaustive list of each of our director nominee’s skills or contributions to the Board. The absence of a mark does not mean that a particular director does not possess that qualification or skill.
CORPORATE GOVERNANCE
| Name(1) | Fees earned or paid in cash ($)(2) | Stock awards ($) (3) | Total ($) | | Dana S. Deasy(4) | 93,750 | 170,000 | 263,750 | | Garth N. Graham | 125,000 | 170,000 | 295,000 | | Carolyn B. Handlon | 125,000 | 170,000 | 295,000 | | Yvette M. Kanouff | 145,000 | 170,000 | 315,000 | | Timothy J. Mayopoulos | 125,000 | 170,000 | 295,000 | | Katharina G. McFarland | 140,000 | 170,000 | 310,000 | | Milford W. McGuirt | 146,250 | 170,000 | 316,250 | | Donna S. Morea | 325,000 | 170,000 | 495,000 | | James C. Reagan | 125,000 | 170,000 | 295,000 | | Steven R. Shane | 145,000 | 170,000 | 315,000 | | John K. Tien, Jr.(5) | 41,331 | 85,000 | 126,331 |
COMPENSATION DISCUSSION AND ANALYSIS
| Executive Summary | 42 | Other Benefits Provided in Fiscal 2025 | 52 | | Fiscal 2025 Business Highlights | 42 | Other Policies and Considerations | 52 | | Compensation Philosophy and Pay Mix | 43 | Assessment of Risks in our Compensation Programs | 52 | | Program Design Overview | 44 | Equity Award Grant Practices | 53 | | Governance of Our Compensation Programs | 44 | Stock Ownership Guidelines and Stock Holding Requirements | 53 | | Results of 2024 Stockholder Advisory Vote | 45 | Prohibition on Hedging or Pledging Company Stock or Purchasing “On Margin” | 53 | | Principal Elements and Objectives of Our Compensation Program | 46 | “Clawback” or Compensation Recoupment Policies | 54 | | Committee Process for Determining Compensation | 47 | Post-Employment Benefits | 54 | | Components of Fiscal 2025 Compensation Programs | 48 | Executive Severance and Change in Control Policy | 54 |
COMPENSATION DISCUSSION AND ANALYSIS
Executive Summary Fiscal 2025 Business Highlights In fiscal year 2025, we achieved robust financial performance, marked by solid revenue growth, strong profitability, and significant cash generation. We progressed on our strategic pivots while maintaining solid business performance, thanks to the unwavering dedication of our workforce. Progress towards our objectives was fueled by the execution of crucial business initiatives, including refining our business strategy to prioritize growth while advancing the power of technology and innovation to serve and protect our world. Throughout fiscal 2025, we effectively executed our strategy, delivering excellence to our customers and generating value for our shareholders. Our ability to secure solid bookings, maintain a steady book-to-bill ratio, generate solid cash flow, and achieve organic growth highlights our fortitude in a challenging business environment, positioning us well for continued growth in fiscal year 2026. (1)Non-GAAP financial measure; see the Appendix to Proxy Statement for a reconciliation of such measure against the most directly comparable GAAP financial measure. (2)Excludes the impact from sale of receivables ($41 million) under the Master Accounts Receivable Purchase Agreement. We stand committed to profitable growth and long-term value creation. Full year adjusted EBITDA increased to 9.5% of revenues, compared to 9.0% in the prior fiscal year. The increase was primarily due to improved profitability across our contract portfolio, lower incentive-based compensation expense, and lower stock-based compensation related to the restructuring and executive transition. Full year operating cash flow was $535 million after excluding sale of receivables. Cash flow generation is key to our shareholder value proposition and allowed us to deliver $75 million in annual dividend payments and to repurchase $527 million in shares of our common stock during fiscal 2025. Total Shareholder Return ("TSR") as of January 31, 2025 TSR for fiscal 2025 was (15%), below a broader market index and a comparable technology index fund. Over a prior three-year period, the Company's TSR outperformed the same broader market index and ranked below the comparable technology index. Compensation Philosophy and Pay Mix The Company maintains a strong “pay-for-performance” compensation philosophy focused on attracting and retaining high quality executive talent and rewarding our executive officers primarily through variable compensation. Fixed compensation (i.e., base salary) is set at appropriate levels to avoid competitive disadvantage and comprises the smallest portion of overall compensation. We believe that this philosophy serves to both encourage and recognize performance excellence and helps drive stockholder value while facilitating a sustainable fixed-cost structure. The charts below depict approximate percentages for each element of target total direct compensation and demonstrate how compensation is significantly weighted towards variable at-risk compensation (short-term cash incentives, performance stock units ("PSUs"), and restricted stock units ("RSUs")). The details of all NEO compensation are provided in the "Executive Compensation" section of this Proxy Statement.
COMPENSATION DISCUSSION AND ANALYSIS
Total direct compensation for NEOs is benchmarked against median levels of compensation of comparable positions in publicly traded companies of our size and in our industry. Consistent with our pay-for-performance philosophy, actual earned compensation varies above or below the median level based on the degree to which specific performance goals are achieved, changes in our stock value over time and the individual performance of each NEO. As indicated above, base salary represents a significantly smaller portion of overall compensation than variable compensation while a more meaningful portion is allocated to annual cash incentive awards that focus executives on annual objectives supporting our long-term strategy. The largest portion of overall compensation for our executive officers is allocated to long-term incentives, supporting long-term value creation and aligning the interests of our executive officers with those of our stockholders. Program Design Overview For fiscal 2025, we maintained the short-term and long-term performance metrics used over the past several fiscal years. The short-term plan combines revenue, adjusted EBITDA, and adjusted operating cash flow performance with an individual leadership multiplier score. The PSUs, which are performance-based RSUs that vest and are settled at the end of a three-year performance period. The PSUs granted to our executive officers in fiscal 2025 are directly related to the achievement of cumulative adjusted EBITDA, cumulative adjusted operating cash flow, and relative total shareholder return ("rTSR") over a three-year period commencing in fiscal 2025. The combination of PSUs and time-based RSUs (vesting over 3 years) provide an appropriate balance of medium-term and long-term incentives. See the Appendix to this Proxy Statement for a reconciliation as to how each non-GAAP performance measure is calculated as compared to the most closely comparable GAAP measure. By aligning significant portions of NEOs’ compensation with profitable growth and operating cash flow, a substantial portion of total compensation for our NEOs is directly linked to key metrics that we believe drive long-term sustained stockholder returns. Based on Company performance in fiscal 2025, the calculated payout of the short-term cash portion of annual incentives was 132.3% of target, as discussed in greater detail beginning on page 49. The Committee applied an individual leadership multiplier score with a range of 0.5 to 1.2 to the calculated annual incentive awards of the Chief Executive Officer and each other NEOs, based upon an assessment of each executive's relative performance during the year. PSUs granted for the fiscal 2023 through 2025 performance period were earned at 134.2% of target, as discussed in greater detail on page 51. Governance of Our Compensation Programs Our compensation programs incorporate best practices regarding corporate governance, risk mitigation and alignment of executive officers’ interests with stockholders’ interests. The following are key features of our compensation practices:
COMPENSATION DISCUSSION AND ANALYSIS
| AT SAIC, WE ... | AT SAIC, WE DO NOT ... | | Believe in pay for performance—simply put, we reward our NEOs when the company performs. Conduct an annual review by the Committee to establish a group of comparable companies to be used in compensation decisions. Review and consider feedback provided by our stockholders related to executive compensation matters. Mitigate against imprudent risk-taking through balancing features in the design of our compensation programs. Subject cash and equity-based incentive compensation to “clawback” policies if there is a restatement of our financial results for any reason or if the employee was involved in misconduct. Require significant stock ownership of our executive officers. Use an independent compensation consultant who reports directly to the Committee. Provide “double-trigger” provisions for certain change in control benefits. | Permit cash buyout or re-pricing of underwater stock options. Guarantee any bonus payouts to executive officers. Provide employment agreements for executive officers. Provide golden parachute excise tax gross-ups on change in control benefits. Permit hedging or pledging of Company stock or purchasing Company stock on margin by our executive officers. Offer defined benefit pension benefits to our executive officers or other employees. Provide excessive perquisites for executive officers. |
COMPENSATION DISCUSSION AND ANALYSIS
| | base salary; | | | payout range for the annual cash incentive awards that may be earned for the upcoming year and the performance goals and criteria upon which the amount of the awards will be determined; | | | mix and amount of equity incentive awards to be granted to our executive officers; and | | | payout range for PSUs that may be earned for the performance period beginning in that fiscal year and the length of the performance period, goals and criteria upon which the amount of the awards for the relevant performance period will be determined. |
COMPENSATION DISCUSSION AND ANALYSIS
In determining the amounts of compensation to be awarded to our NEOs, the Committee considers the Company’s overall performance and competitive market data for our compensation peer group. Company performance is the primary factor in determining variable compensation. The amount of any cash or performance-based equity incentive awards to be paid upon completion of the applicable performance period is determined based upon our achievement of short- and long-term financial goals set at the beginning of the fiscal year or performance period, as the case may be. However, the final cash incentive award payout also reflects an individual leadership multiplier score. The Committee retains the ability to use negative discretion to reduce payouts when appropriate. Individual performance is a factor in setting base salaries. In determining base salaries for our NEOs, the Committee reviews a performance assessment for each of our executive officers, as well as compensation recommendations for the NEOs other than the Chief Executive Officer made by the Chief Executive Officer. The Committee also considers market data, analysis and recommendations regarding executive officer compensation provided by FW Cook, its independent compensation consultant. The NEOs do not propose their own compensation. The Committee assesses our Chief Executive Officer's performance. In determining compensation for our Chief Executive Officer, the Committee meets in executive session and evaluates her performance based on her achievement of performance objectives that are established at the beginning of the fiscal year. Formal input is received from the independent directors and the executive leadership team. The Committee also considers the Chief Executive Officer’s leadership contributions towards the Company’s performance, including financial results, development and achievement of strategic objectives, progress in building capability among the executive leadership team, development of a succession plan for executive leadership and corporate governance leadership, as well as market data and analysis and recommendations provided by the Committee’s independent compensation consultant. The Committee determines the Chief Executive Officer’s compensation and then reviews her evaluation and compensation with the Board’s independent directors. The Chief Executive Officer does not propose her own compensation and is not present for discussions of her performance and compensation. The Independent Chair of the Board and the Chair of the Committee then present the Committee’s evaluation and compensation determination to the Chief Executive Officer. The Committee reviews our compensation peer group annually. The Committee uses peer group information as a reference point for assessing compensation levels and practices. The Committee, with the assistance of FW Cook, annually reviews and approves the list of companies to ensure its appropriateness. In evaluating and selecting companies for inclusion in the peer group, the Committee targets comparably sized publicly traded information technology, consulting, defense, and engineering companies, as well as companies with whom we compete for executive talent with similar roles and responsibilities, which we refer to as our “compensation peer group.” For fiscal 2025, the compensation peer group used to determine target compensation was approved by the Human Resources and Compensation Committee in the fall 2023 committee meeting and consisted of the following 13 companies. One prior peer, ManTech International Corp. was acquired and removed from the peer group and ICF International was added to the peer group due to its industry fit and to provide balance to the group.
COMPENSATION DISCUSSION AND ANALYSIS
The compensation peer group generally reflects companies with annual revenues between one-third to three times our estimated revenues for the fiscal year in which the peer group is reviewed. Compensation data from two nationally-recognized, broad- based third-party surveys provides the Committee with additional perspective regarding the competitive landscape for executive talent. The Committee considers survey data along with the compensation peer group data when evaluating appropriate levels of direct compensation. To be competitive in the market for our executive-level talent, we benchmark overall compensation for our NEOs against the market median. Actual cash incentive awards paid and PSUs earned vary, consistent with our pay-for- performance philosophy, based on pre-established performance metrics and may therefore generate realized compensation that is higher or lower than the market median. Components of Fiscal 2025 Compensation Programs
Base Salary
Base Salary In reviewing and approving the fiscal 2025 base salaries for our NEOs, the Committee considered its independent compensation consultant’s analysis of pay levels among the compensation peer group and survey data, which indicated that base salaries for our NEOs were generally competitive relative to the peer group and to survey data for all executive officers. Individual base salaries also reflect the Committee’s judgment with respect to each NEO’s roles and responsibilities, leadership skills, performance and work experience. The Committee reviews NEOs’ base salaries annually or at the time of a promotion or a substantial change in responsibilities based on the above-described criteria. In fiscal 2025, base salaries for the NEOs were increased to better align their compensation with the market for comparable positions and are summarized below.
Annual Cash Incentive Awards
Annual Cash Incentive Awards Our short-term incentive (“STI”) plan is the primary compensation element used to reward NEO accomplishments against established business goals approved by our Committee within a given year. Our annual cash incentive awards are based upon performance against predetermined goals for the fiscal year to encourage and reward contributions to our annual financial, operating and strategic objectives. Performance goals for cash incentive awards. At the beginning of each fiscal year, the Committee sets and approves threshold, target and maximum performance goals for the upcoming year based on objective financial goals. Further, the Committee reviews and approves the corresponding target cash incentive awards based upon the achievement of those goals. No amount is payable for below-threshold performance. When threshold performance is met, payouts are determined on a straight-line basis between threshold and target performance and between target and maximum performance up to a maximum payout of 200%. The diagram below illustrates how we determined fiscal 2025 cash incentive awards to our NEOs under our STI plan followed by a more detailed description of the performance for fiscal 2025. (1)EBITDA is a non-GAAP financial measure and should be read in conjunction with net income, a GAAP financial measure; see the Management’s Discussion and Analysis of Financial Conditions and Results of Operations section in Part II, Item 7 of our Annual Report on Form 10-K for the year ended January 31, 2025, for further information. Performance measures for fiscal 2025. The financial performance measures for fiscal 2025 were closely aligned with the Company’s strategy for sustained profitable growth and long-term value creation. For fiscal 2025, we maintained the core financial measures that we used in fiscal 2024: revenue, adjusted EBITDA, and adjusted operating cash flow, which directly align to our overall strategy and shareholder value creation with equal weightings of 33.3%. These metrics focus on profitable growth and strong cash generation. The financial performance measures, their relative weightings, the threshold, target and maximum achievement levels and actual performance for our short-term incentive program for fiscal 2025, as approved by the Committee, is reflected in the table below. For fiscal 2025, the results reflect our organic revenue growth of 3.1% and improvement in adjusted EBITDA margins of 50 basis points.
Fiscal 2025 Short-Term Incentive Awards
Fiscal 2025 Short-Term Incentive Awards
Fiscal 2025 Short-Term Incentive Awards
| Financial Measures(1) | Weight | Threshold | Target | Maximum | Actual(1) | % of Target Achieved | Payout % | | Revenue | 33.3% | $7.292B | $7.542B | $7.763B | $7.479B | 99.2% | 87.4% | | Adjusted EBITDA | 33.3% | $682M | $700M | $722M | $705M | 100.7% | 122.7% | | Adjusted Operating Cash Flow | 33.3% | $510M | $525M | $540M | $538M | 102.5% | 186.7% | | STI Award Payout Percentage | | | | | | | 132.3% |
Fiscal 2025 Short-Term Incentive Awards
(1)See the Appendix to this Proxy Statement for a reconciliation as to how each adjusted non-GAAP performance measure is calculated as compared to the most closely comparable GAAP measure. Determination of leadership score. The score reflects performance during the fiscal year and is focused on both what and how results were achieved based on a mix of quantitative and qualitative performance and leadership expectations with a focus on enabling our strategic culture shifts and upholding our core values. The score range for the NEOs was expanded in fiscal 2025 to 0.5 to 1.2 (meaning that a multiplier of -50% up to +20% may apply) to allow for greater differentiation in executive payouts to account for outsized negative or positive performance and drive greater ability to reflect leader accountability. The final score is based upon an assessment of each executive's relative performance and is determined by the Committee for the Chief Executive Officer and with input from the Chief Executive Officer for the other NEOs. Determination of annual incentive award amounts. For fiscal 2025, the Committee set the target amount of the cash incentive award at 150% of base salary for the Chief Executive Officer and between 80% and 100% of base salary for the other NEOs based on applicable market data. In determining the payout level amount, the Committee applied the STI award payout percentage (132.3% in fiscal 2025 as calculated in the table above) to the target cash incentive amount and further applied leadership factors ranging from 0.8 to 1.2 based upon an assessment of each executive's relative performance during the year up to the maximum payout of 200% of target. For our NEOs, the target cash incentive award amounts as a percentage of base salary and award amounts earned in fiscal 2025 were as follows:
Fiscal 2025 Short-Term Incentive Awards
| Name | Base Salary | STI Target as % of Base Salary | Financial Score | Cash Incentive Amount Paid | | Toni Townes-Whitley | $1,200,000 | 150% | 132.3% | $2,619,540 | | Prabu Natarajan | $720,000 | 100% | 132.3% | $1,143,072 | | Srinivas Attili(1) | $550,000 | 80% | 132.3% | $480,249 | | Hilary L. Hageman | $575,000 | 100% | 132.3% | $836,798 | | David C. Ray | $425,000 | 80% | 132.3% | $359,856 |
Fiscal 2025 Short-Term Incentive Awards
(1)Mr. Attili's short term incentive was prorated based on number of months worked in fiscal 2025.
Long-Term Incentive Awards
Long-Term Incentive Awards We provide equity incentive awards to our NEOs to motivate them to stay with us and build long-term shareholder value through their future performance. We benchmark our NEOs’ long-term incentive award opportunities at the median of the competitive market. The following forms of long-term incentive compensation were provided to our NEOs in fiscal year 2025:
Long-Term Incentive Awards
| | Performance Stock Units (60%) Incentivize our NEOs to achieve specific measurable financial goals over a three-year performance cycle. Earned shares vest and are issued at the end of the performance cycle and range from 0% for below threshold performance to 200% for maximum performance. PSUs are granted annually in overlapping performance cycles and serve as a tool to align pay and Company performance and to retain our NEOs. Dividend equivalents are accumulated in cash and are paid at the end of the three-year performance cycle to the extent that the underlying PSUs are earned. | | | Restricted Stock Unit (40%) Align pay and Company performance as reflected in our stock price, encourage retention of our NEOs’ services and promote continued investment by our executives in Company stock. RSUs awarded in fiscal 2025 vest over a three-year period in 33% installments at each anniversary of the grant date. Dividend equivalents on unvested RSUs accumulate in cash and are paid when and if the underlying RSUs vest. |
Fiscal 2025-2027 Performance Stock Units
Fiscal 2025-2027 Performance Stock Units For fiscal 2025, 60% of the long-term incentives awarded to our NEOs were provided in the form of PSUs (valued at target payout). The performance measures and corresponding weightings for the fiscal 2025 PSUs are as follows:
Fiscal 2025-2027 Performance Stock Units
| Performance Measures | Weight | Description | | Cumulative Adjusted EBITDA | 33.3% | Three-year cumulative goal set at the beginning of the performance period | | Cumulative Adjusted Operating Cash Flow | 33.3% | Three-year cumulative goal set at the beginning of the performance period | | Relative Total Shareholder Return (rTSR) | 33.3% | Three-year TSR performance compared to our compensation peer group. TSR is calculated based on a 30 trading day average at the beginning and end of the performance period, with dividends assumed to be reinvested as of ex-dividend date. |
Fiscal 2025-2027 Performance Stock Units
At the beginning of each three-year performance period, the Committee establishes the performance measures to be used for that performance period, their weightings and the levels of performance on those measures for the entire three-year performance period that will generate threshold, target, and maximum payouts. The number of PSUs delivered at the end of the three-year performance cycle may range from 0% for below threshold performance to 50% for threshold performance and up to 200% for maximum performance. When the performance threshold is met, payouts are determined on a straight line interpolation basis for performance levels between threshold and target and between target and maximum. The final PSU payout is delivered at the end of the three-year performance cycle. The financial targets are closely aligned with the Company’s long-term financial strategy, and not publicly disclosed at the time of the award issuance due to the proprietary and competitive nature of this information. For rTSR, we measure our ranking as compared to our compensation peer group. Threshold is set at the 25th percentile, target at the 50th percentile and maximum at the 75th percentile. For TSR, the range for payout is 0% for threshold performance to 200% for maximum performance with payouts determined on a straight line interpolation. Final achievement and payouts for each of the above goals will be determined and disclosed by the Committee at the conclusion of fiscal 2027. In addition to the annual Long-Term Incentive Awards, Mr. Attili received a one-time sign-on RSU grant on June 7, 2024, with a grant date value of $1,000,000, that vests 33% on the first, second, and third year anniversaries of the date grant. Mr. Ray received a one-time special RSU grant on September 13, 2024, with a grant date value of $1,000,000, that will vest in full on January 29, 2027. These awards are aimed at recruiting and retaining critical executives in the Company. Certification of fiscal 2023-2025 PSUs. The Compensation Committee reviewed and approved performance against pre- established targets for the fiscal 2023-2025 plan. Payout amounts for fiscal 2023-2025 performance stock units were as follows:
Fiscal 2023-2025 Performance Stock Units Payout
Fiscal 2023-2025 Performance Stock Units Payout
Fiscal 2023-2025 Performance Stock Units Payout
| Performance Measures | Performance Period | Weight | Threshold 50% | Target 100% | Maximum 200% | Actual(1) | % of Target Achieved | Payout % | | Cumulative Adjusted EBITDA | FY23-25 | 33% | $1.755B | $2.065B | $2.375B | $2.060B | 99.8% | 99.2% | | Cumulative Adjusted Operating Cash Flow | FY23-25 | 33% | $1.390B | $1.737B | $2.084B | $1.865B | 107.4% | 136.9% | | Performance Measures | Performance Period | Weight | Threshold 0% | Target 100% | Maximum 200% | Actual(1) | % of Target Achieved | Payout % | | Relative Shareholder Return | FY23-25 | 33% | 25.0% | 50.0% | 75.0% | 66.7% | 133.3% | 166.7% | | Share Payout Percentage | | | | | | | | 134.2% |
Fiscal 2023-2025 Performance Stock Units Payout
(1)See the Appendix to this Proxy Statement for a reconciliation as to how each adjusted non-GAAP performance measure is calculated as compared to the most closely comparable GAAP measure. Other Benefits Provided in Fiscal 2025 In addition to the elements of direct compensation described above, we also provide our NEOs with the following benefits: Health and welfare benefits. Our NEOs are entitled to participate in the health and welfare plans that we generally offer to all of our eligible employees, which provide medical, dental, health, group term life insurance and disability benefits. We believe that these health and welfare benefits are reasonable in scope and amount and are of the kind typically offered by other companies against which we compete for executive talent. Additionally, our NEOs are eligible to participate in a physical health program. The program provides the NEOs with a comprehensive medical assessment and personalized preventive strategies to maintain and improve personal health. Retirement benefits. Our NEOs are entitled to participate in the same defined contribution retirement plan that is generally available to all of our eligible employees. Currently, we provide matching contributions to eligible participants’ retirement plan accounts based on a percentage of their eligible compensation under applicable rules. The amount of contributions we made to the retirement plan accounts of each of our participating NEOs in fiscal 2025 was $13,800 per person with the exception of Mr. Attili and Mr. Ray. Matching contribution amounts for Mr. Attili was $13,637 and Mr. Ray does not contribute to the SAIC Retirement Plan. The Committee believes that these contributions to this retirement program permit our NEOs to save for their retirement in a tax-effective manner, are reasonable in scope and amount and are of the kind typically offered by other companies against which we compete for executive talent. Deferred compensation plan. To provide other tax-deferred means to save for retirement, we maintain the Deferred Compensation Plan that allows our NEOs and other eligible participants to elect to defer a portion of any cash incentive awards granted to them under our incentive plans and a portion of their eligible salary. Though the Company may make discretionary contributions to participating NEOs, we made no contributions to NEOs’ Deferred Compensation Plan accounts for fiscal 2025. Vested deferred balances under the Deferred Compensation Plan will generally be paid upon retirement or termination. We also have an additional frozen deferred compensation plan. These plans are described in more detail under “Executive Compensation, Nonqualified Deferred Compensation” below in this Proxy Statement. Perquisites and personal benefits. We do not provide excessive perquisites or personal benefits to our NEOs. Given the nature of our business, we believe security is necessary and generally provided to other executives within our industry. As the safety and security of our NEOs is of utmost importance, certain security measures are provided, including physical security, residential security, network security and dark web monitoring in response to escalating cybersecurity threats. Other Policies and Considerations Assessment of Risks in our Compensation Programs In the design and oversight of our compensation programs for NEOs and all employees, each year the Committee, with assistance from FW Cook, the Committee’s independent compensation consultant and management, assesses risks related to our pay practices and incentive programs. The risk assessment is focused on identifying risks associated with our compensation programs and the mix of each type of compensation element we provide to our NEOs and all employees, as well as the measures that the Company may employ to mitigate those risks. The Committee believes that the following features of our compensation programs effectively mitigate excessive risk-taking that could harm our value or reward poor judgment by our NEOs or other employees:
Fiscal 2023-2025 Performance Stock Units Payout
| | short-term incentive measures are balanced among different financial measures, with goals that are intended to be achievable upon realistic levels of performance; | | | significant weighting towards long-term incentive compensation promotes long-term decision making and discourages short-term risk-taking; | | | goals are based on Company performance measures, which mitigates excessive risk-taking within any particular business operation; | | | maximum payouts are capped at levels that do not reward excessive risk-taking; | | | our compensation recoupment policies allow us to recover compensation based on financial results that are subsequently restated or if fraud or intentional misconduct is involved; and | | | our stock ownership guidelines encourage a long-term perspective. |
Fiscal 2023-2025 Performance Stock Units Payout
For fiscal 2025, the Human Resources and Compensation Committee discussed and analyzed risks associated with the Company’s compensation policies and practices for executive officers and all employees generally. The Committee did not identify any risks arising from the Company’s compensation programs or practices that are reasonably likely to have a material adverse effect on the Company. Equity Award Grant Practices The Committee is responsible for the administration of our equity incentive plans. Generally, in advance of each fiscal year, the Committee will select predetermined dates on which equity awards will be granted to our employees, including our NEOs, during the following fiscal year. These grant dates are selected to occur after the dates we anticipate releasing our annual or quarterly financial results. We generally grant equity incentive awards to our directors, executive officers and all other eligible employees on an annual basis shortly after we announce our financial results for the recently completed fiscal year. In addition to these annual grants, the Committee predetermines four quarterly dates on which any additional equity incentive awards may be made to eligible NEOs or other employees in connection with an offer of employment, for retention purposes or to recognize performance. The company does not schedule its equity grants in anticipation of the release of material non-public information (“MNPI”) nor does the company time the release of MNPI based on equity grant dates. The Committee approves all equity awards made to our NEOs. Stock Ownership Guidelines and Stock Holding Requirements We encourage our employees to own our stock so that they are motivated to maximize our long-term performance and drive sustained stock value creation. We have adopted stock ownership guidelines for our executive officers that require them to accumulate and maintain stock holdings calculated as a multiple of their base salary, depending on their role. The sum of all shares owned outright, shares held in a trust for the benefit of the employee or his/her immediate family members, vested stock held in the KESDP and MSCP compensation plans, stock held in a retirement plan and one-half (50%) of unvested time-based RSUs count toward the required ownership. No other equity holdings count toward meeting the ownership requirement including any unvested PSUs or unvested, unexercised stock options.
Fiscal 2023-2025 Performance Stock Units Payout
| POSITION | TARGET OWNERSHIP (Multiple of Base Salary) | | Chief Executive Officer | 5x | | Other Named Executive Officers | 3x |
Fiscal 2023-2025 Performance Stock Units Payout
In addition to stock ownership guidelines, we also maintain a stock holding requirements policy, which mandates that executive officers must hold 100% of the net shares acquired under our equity incentive programs until the applicable multiple of base salary is achieved. Messrs Natarajan and Ray have satisfied their ownership goals. Ms. Hageman is expected to satisfy her ownership goals in fiscal 2026. As Ms.Townes-Whitley was hired during fiscal year 2024 and Mr. Attili was hired in fiscal year 2025, both are making progress toward their ownership goals. Prohibition on Hedging or Pledging Company Stock or Purchasing “On Margin” We have established policies that prohibit all executive officers, directors and employees from engaging in any short selling and hedging transactions in our securities that may carry a greater risk of liability for insider trading violations and also create an appearance of impropriety. For example, with respect to our securities, our executive officers, directors and employees are not permitted to engage in any short sales or any trading in puts, calls or other derivatives on an exchange or other organized market. In addition, we prohibit our executive officers, directors and employees from pledging company stock as collateral for a loan or purchasing company stock “on margin.” Further, our executive officers, directors and senior managers are required to obtain pre-clearance from our General Counsel for all transactions in our securities. “Clawback” or Compensation Recoupment Policies We maintain a mandatory compensation recovery policy for our current and former Section 16 officers and other officers as designated by the Human Resources and Compensation Committee to require recovery of certain incentive-based compensation pursuant to Rule 10D-1 of the Exchange Act and the applicable stock exchange rules. This mandatory compensation recovery policy was filed as an exhibit to our annual report on Form 10-K for the fiscal year ended February 2, 2024. In addition (and not in lieu of the mandatory compensation recovery policy), we continue to maintain a discretionary compensation recovery policy pursuant to which we may require executive officers and other employees who receive incentive compensation to return cash and equity incentives if there is a required accounting restatement to correct an error in previously issued financial statements (upon which the incentive compensation was based). If we determine that recovery is appropriate, we will seek repayment of the difference between the incentive compensation paid and the incentive compensation that would have been paid, if any, based on the restated financial results. This policy also gives us discretion to recover cash and equity incentive compensation from any employee involved in fraud or intentional misconduct whether or not such conduct results in a restatement of our financial results. In cases of fraud or misconduct, we may seek recovery of short-term cash incentives and/or any equity compensation paid (and/or any subsequent gains realized from the sale of any underlying SAIC shares). We may seek to recover the applicable amount of compensation from incentive compensation paid or awarded, as a reduction from future payments of incentive compensation, or by cancellation of outstanding equity awards. Post-Employment Benefits We do not maintain a defined benefit or other supplemental retirement plan that would entitle our executive officers to receive company-funded payments if they leave the Company. Upon certain terminations of employment, including death, disability, retirement or a change in control, our employees, including our NEOs, may be eligible for continued vesting of equity awards on the normal schedule or accelerated vesting in full or on a pro rata basis, depending on the nature of the event and the type of award. The purpose of these provisions is to protect previously earned or granted awards by making them available following the specified event. Because these termination provisions are contained in our standard award agreements for all recipients and relate to previously granted or earned awards, we do not consider these potential termination benefits as a separate item in compensation decisions for our NEOs. Our long- term incentive plans do not provide for additional benefits or tax gross-ups. For more information about potential post-employment benefits, see “Executive Compensation—Potential Payments upon Termination or a Change in Control” in this Proxy Statement. Executive Severance and Change in Control Policy None of the NEOs have employment agreements with the Company. We maintain an Executive Severance, Change in Control and Retirement Policy which specifies the compensation and benefits payable in connection with certain termination events for our executive officers in change in control, non-change in control, and retirement events as further described in this Proxy Statement under “Executive Compensation—Potential Payments upon Termination or a Change in Control.” We believe that this policy provides an important benefit to us by helping alleviate any concern the executive officers might have during a potential change in control of our Company and permitting them to focus their attention on our business. In addition, we believe that this policy is an important recruiting and retention tool, as many of the companies with which we compete for talent have similar arrangements in place for their senior management. There are no excise tax gross-up provisions authorized by the policy. This policy renews for successive one-year terms each year, unless the Company provides notice to the eligible executive officers of either amendments to the policy or termination of the policy or has provided notice to an individual eligible executive officer that he or she is no longer eligible for the policy no later than November 1 of the term year. This annual term permits the Committee to review regularly the amount of benefits that would be provided to our executive officers in connection with certain termination events and to consider whether to continue providing those benefits. Human Resources and Compensation Committee Report The Human Resources and Compensation Committee has reviewed and discussed with our management the Compensation Discussion and Analysis included in this Proxy Statement. Based upon this review and discussion, the Committee recommended to the Board of Directors that the Compensation Discussion and Analysis be included in this Proxy Statement. Steven R. Shane (Chair) Garth N. Graham Timothy J. Mayopoulos Donna S. Morea James C. Reagan
EXECUTIVE COMPENSATION
| Name and principal position | Fiscal Year(1) | Salary ($) | Bonus ($)(2) | Stock awards ($)(3) | Non-equity incentive plan compensation ($)(4) | All other compensation ($)(5) | Total ($) | | Toni Townes-Whitley Chief Executive Officer | 2025 | 1,200,000 | | 6,384,074 | 2,619,540 | 38,129 | 10,241,743 | | | 2024 | 578,077 | — | 7,175,963 | 3,232,320 | 3,958 | 10,990,318 | | Prabu Natarajan Chief Financial Officer | 2025 | 716,923 | — | 1,695,945 | 1,143,072 | 15,131 | 3,571,071 | | | 2024 | 696,154 | — | 1,784,097 | 1,400,000 | 27,538 | 3,907,789 | | | 2023 | 663,462 | — | 4,500,148 | 677,700 | 12,450 | 5,853,760 | | Srinivas Attili Executive Vice President, Civilian Business Group | 2025 | 391,346 | 1,000,000 | 1,704,111 | 480,249 | 20,517 | 3,596,223 | | Hilary L. Hageman Executive Vice President, General Counsel and Corporate Secretary | 2025 | 571,154 | — | 1,296,884 | 836,798 | 15,131 | 2,719,967 | | David C. Ray Executive Vice President, Space and Intelligence Business Group | 2025 | 424,878 | — | 1,498,931 | 359,856 | 1,331 | 2,284,996 |
EXECUTIVE COMPENSATION
| Fiscal Year(1) | Summary Compensation Table Total for First PEO (Keene) ($) | Compensation Actually Paid to First PEO (Keene)(2)(3)(4) ($) | Summary Compensation Table Total for Second PEO (Townes- Whitley) ($) | Compensation Actually Paid to Second PEO (Townes- Whitley)(2)(3)(4) ($) | Average Summary Compensation Table Total for Non-PEO NEOs ($) | Average Compensation Actually Paid to Non-PEO NEOs(2)(3)(4) ($) | Total Shareholder Return(5) | Peer Group Total Shareholder Return(5) | Net Income ($ in millions)(6) | Revenue ($ in millions)(7) | | 2025 | — | — | 10,241,743 | 8,432,362 | 3,043,064 | 2,628,442 | 132.94 | 195.26 | 362 | 7,479 | | 2024 | 12,895,917 | 18,951,966 | 10,990,318 | 13,473,423 | 4,541,334 | 6,387,422 | 156.53 | 153.18 | 477 | 7,444 | | 2023 | 8,664,380 | 13,290,774 | — | — | 4,681,658 | 5,523,501 | 124.66 | 119.29 | 303 | 7,704 | | 2022 | 8,343,156 | 6,384,092 | — | — | 2,563,133 | 2,239,947 | 95.92 | 121.59 | 279 | 7,394 | | 2021 | 6,936,702 | 9,060,542 | — | — | 1,945,432 | 2,322,465 | 111.36 | 106.52 | 211 | 7,056 |
Compensation Actually Paid and Company/Peer Group Total Shareholder Return
Compensation Actually Paid and Company/Peer Group Total Shareholder Return
Compensation Actually Paid and Net Income
Compensation Actually Paid and Net Income
Compensation Actually Paid and Revenue
Compensation Actually Paid and Revenue