DEF 14A of Xerox Holdings Corp
Filed Apr 9, 2025 · FY20240001770450-25-000017
PROPOSAL 1 — ELECTION OF DIRECTORS
PROPOSAL 1 — ELECTION OF DIRECTORS Shareholders annually elect directors to serve for one year and until their successors have been elected and have been qualified. Based on the director nomination process described below, the nine persons whose biographies appear below have been nominated by the Board to serve as directors. All of the director nominees currently serve on the Board. Mr. Scott Letier is being nominated by the Board pursuant to the Nomination and Standstill Agreement, dated January 26, 2021, between the Company and Darwin Deason. See 2021 Nomination and Standstill Agreement for further information. Each nominee brings to us valuable experience from a variety of fields. The biographical information presented regarding each nominee’s specific experience, qualifications, attributes, and skills led our Board to the conclusion that he or she should serve as a director. We believe that each of the nominees has demonstrated business acumen, an ability to exercise independent and sound judgment, an understanding of the Company’s business environment, and a commitment to serve the Company and our Board. We also value their significant experience on other public company boards of directors and board committees. The Board has determined that each of the nominees (other than Steven J. Bandrowczak, Chief Executive Officer of the Company, and John Bruno, President and Chief Operating Officer of the Company) are independent under The Nasdaq Stock Market LLC (Nasdaq) corporate governance rules and the Company’s independence standards. It is expected that all nominees proposed by our Board will be able to serve on the Board if elected. Although not anticipated, if for any reason a nominee is unable to serve, the proxies may use their discretion to vote for a substitute nominated by the Board.
Board Qualifications
Board Qualifications The Board is continuously seeking highly qualified candidates to add to the range of skills and experiences represented on our Board. The nine individuals nominated for election at our 2025 Annual Meeting offer a variety of perspectives, personal and professional experiences, and backgrounds. Although each director nominee brings numerous valuable skills and other attributes to the Board, the three key areas of specialization of each director nominee on which the Board relies most heavily are set forth in the table below.
Board Skills Matrix
Board Skills Matrix
(As of March 15, 2025)
(As of March 15, 2025)
(As of March 15, 2025)
| | Bandrowczak | Bruno | Erwin | Hung | Letier | Maynard-Elliott | McLaughlin | Roese | Schwetz | | Key Skills & Experience | | | | | | | | | | | Technology | P | P | P | | P | P | P | P | | | M&A and Strategy | | | | P | | P | P | | P | | Finance | | | | | P | P | | | P | | Business Operations | P | P | P | P | P | | P | P | P | | Reinvention | P | P | P | P | | | | P | |
(As of March 15, 2025)
In addition, we have provided below the principal occupation and other information about the relevant experience, qualifications, attributes, or skills that the Board has concluded qualify each of the nominees to serve as a director of the Company. Each director nominee has consented to being named in this Proxy Statement, and has agreed to serve if elected. The tenure of the current directors who are standing for election at this Annual Meeting averages approximately 2.2 years.
(As of March 15, 2025)
| | Steven J. Bandrowczak Age: 64 Director since: 2022 Occupation: Chief Executive Officer of Xerox Education: B.S. in Computer Science, Long Island University; M.S. in Technology Management, Columbia University |
(As of March 15, 2025)
Other Public Company Directorships (past 5 years): None. Other Background: Mr. Bandrowczak was named Chief Executive Officer of Xerox Holdings Corporation effective August 2022. He joined Xerox in 2018, as President and Chief Operations Officer. Prior to joining Xerox, Mr. Bandrowczak served as Chief Operating Officer and Chief Information Officer at Alight Solutions, where he was responsible for the application portfolio and technical infrastructure of the organization. Throughout his career, Mr. Bandrowczak also held senior leadership positions at various multi-billion-dollar global companies, including Avaya, Nortel, Lenovo, DHL and Avnet. Mr. Bandrowczak was a director of Fuji Xerox in 2019. He teaches “Leading Disruptive Change in Digital Economy” at Northeastern University and is an Executive-in-Residence for Northeastern University's Center for Technology Management and Digital Leadership.
(As of March 15, 2025)
| | John G. Bruno Age: 60 Director since: 2024 Occupation: President and Chief Operating Officer of Xerox |
(As of March 15, 2025)
Other Public Company Directorships (past 5 years): Global Payments (NYSE: GPN); Valor Latitude Acquisition Corp. (NASDAQ: VLAT). Other Background: Mr. Bruno joined Xerox in 2022 as President and Chief Operating Officer, where he is responsible for the Print, Digital Services, and IT Solutions business units. Prior to joining Xerox, Mr. Bruno was CEO of Storm Ventures LLC. Mr. Bruno served as Chief Operating Officer of Aon, a global professional services firm, and Chief Executive Officer of Data & Analytics Services from 2014-2021. Prior to AON, Mr. Bruno was President, Industry & Field Operations and Executive Vice President of Corporate Development for NCR Corporation from 2008-2014. He has also held senior leadership positions with Goldman Sachs, Merrill Lynch, Cisco Systems, and United Parcel Services. Mr. Bruno currently serves on the board of directors of Global Payments Inc., where he is chair of the compensation committee as well as a member of the technology committee. Mr. Bruno also served on the board of directors of Valor Latitude Acquisition Corp., from 2022 to May 2023, where he served as a member of the compensation, audit, and nominating governance committees.
(As of March 15, 2025)
| | Tami A. Erwin Age: 60 Director since: 2024 Occupation: Former EVP and CEO of Verizon Business Group Education: Business Administration, Pacific Union College, Executive Program at the Stanford University Graduate School of Business Board Committees: Corporate Governance (Chair), Audit |
(As of March 15, 2025)
Other Public Company Directorships (past 5 years): John Deere (NYSE: DE), and F5 (NASDAQ: FFIV). Other Background: Ms. Erwin is a veteran CEO, Fortune 500 director, and expert on digital transformation and growth. She served as EVP and CEO of Verizon Business Group from 2019 to 2022. Prior to becoming EVP and CEO, she served as EVP of Operations at Verizon from 2016 to 2019, and held numerous other senior level positions in the company. As EVP and CEO of Verizon Business, Ms. Erwin led more than 26,000 employees in 60 countries. Over three and a half years, she scaled an organization that delivered significant gains in profitability and revenue ($31+ billion in 2022), and advanced Verizon’s leadership in 5G technology. Ms. Erwin built a culture known for high performance, inclusivity, and belonging. Ms. Erwin serves on the boards of John Deere, F5, York Space Systems, and Skylo. She is also a member of the advisory council of Dublin-based Aptiv (NYSE:APTV), an operating partner with UK-based infrastructure investment group Digital Gravity, an advisor to the CEO of Cohesity, a Senior Fellow of Mission Possible Partnership, and a Champion of Journey to Lead, a nonprofit that works to advance diversity at the top of the private sector.
(As of March 15, 2025)
| | Priscilla Hung Age: 58 Director since: 2024 Occupation: Senior Advisor, Former President & Chief Operating Officer, Guidewire Software Education: B.A., Computer Science, Mills College; MEng, Operation Research & Industrial Engineering, Cornell University Board Committees: Finance, Corporate Governance |
(As of March 15, 2025)
Other Public Company Directorships (past 5 years): Veeva Systems (NYSE: VEEV), Waystar (NASDAQ: WAY), Vonage Holdings (NYSE: VG) Other Background: Ms. Hung became Senior Advisor to Guidewire Software, a provider of cloud-based software for the insurance industry in 2024 after serving in various management roles since 2005, most recently serving as President and Chief Operating Officer from 2020 to 2023. Prior to that, Ms. Hung held senior roles at various companies including Ariba Technologies and Sun Microsystems. She is currently a member of the board of directors of Veeva Systems, a leading provider of industry cloud solutions for the global life sciences industry, where she is also a member of the audit committee. Ms. Hung also serves as a member of the board of directors of EthosTechnologies, a privately held online life insurance platform, and Waystar, a cloud-based software platform that simplify healthcare payments, where she also serves as a member of the audit and compensation committees. Ms. Hung was also a director of Vonage Holdings from 2019 until its acquisition in 2022, where she served as nominating governance chair and a member of the audit, compensation and technology committees.
(As of March 15, 2025)
| | Scott Letier Age: 64 Director since: 2018 Occupation: Chief Investment Officer and Managing Director of Deason Capital Services, LLC Education: B.B.A. with a concentration in accounting, Southern Methodist University - Cox School of Business Board Committees: Finance (Chair), Corporate Governance |
(As of March 15, 2025)
Other Public Company Directorships (past 5 years): Conduent Incorporated (NASDAQ: CNDT). Other Background: Mr. Letier has served as Chief Investment Officer and Managing Director of Deason Capital Services, LLC (“DCS”) since July 2014. Prior to joining DCS, Mr. Letier was the Managing Director of JFO Group, LLC, the family office for the Jensen family, from September 2006 to July 2014. Mr. Letier has over 20 years of experience in leadership roles, previously serving as a private equity investment professional and chief financial officer. He began his career in the audit group at Ernst & Whinney (now Ernst & Young). Mr. Letier has served on numerous boards in the past, and currently serves as chairman of the board of directors of Conduent Incorporated, a provider of business process outsourcing services, where he also serves as a member of the audit, compensation and governance committees. Mr Letier serves on the boards of several private companies, including Colvin Resources Group, a Dallas-based search and staffing firm, Strive Asset Management, File & ServeXpress, LLC, an electronic filing, process service, and secure document exchange platform serving the legal system, and Gardenuity, Inc., a tech enabled retailer. Mr. Letier also serves on the fund advisory board of Anchor Capital GP, a Dallas-based private equity firm and venture capital fund, and Griffis Residential, a Denver based multi-family real estate management and investment firm.
(As of March 15, 2025)
| | Nichelle Maynard-Elliott Age: 56 Director since: 2021 Occupation: Former Executive Director, Mergers & Acquisitions, for Praxair, Inc. (a wholly-owned subsidiary of Linde plc) Education: B.A. in Economics, Brown University; J.D., Columbia University School of Law Board Committees: Compensation and Human Capital (Chair), Audit |
(As of March 15, 2025)
Other Public Company Directorships (past 5 years): Element Solutions Inc. (NYSE: ESI); Lucid Group, Inc. (NASDAQ: LCID). Other Background: Ms. Maynard-Elliott was Executive Director, Mergers & Acquisitions, for Praxair, Inc., a worldwide industrial gases company, from July 2011 to May 2019, where, among other things, she advised Praxair on its $90 billion merger with the Linde Group in 2018. In this role, she was responsible for evaluating and negotiating global acquisitions, divestitures, joint ventures, and other business combinations. Ms. Maynard- Elliott joined Praxair in 2003. Prior to Praxair, Ms. Maynard-Elliott served as an associate at the law firms of Kelley Drye & Warren LLP, Pryor Cashman LLP, and Weil, Gotshal & Manges LLP. Ms. Maynard-Elliott served as an independent director of Element Solutions Inc., a global specialty chemicals firm between August 2018 and June 2024. Ms. Maynard-Elliott has served as an independent director of Lucid Group, Inc., a manufacturer of electric vehicles, since 2021, and currently serves as a member of its compensation, audit and nominating and corporate governance committees. She also serves as a trustee of The Advisor’s Inner Circle Fund III (and affiliated trusts), where she is chair of its governance committee.
(As of March 15, 2025)
| | Edward G. McLaughlin Age: 59 Director since: 2024 Occupation: President and Chief Technology Officer of Mastercard Education: B.A., University of Pennsylvania, Wharton School of Business Board Committees: Compensation and Human Capital, Corporate Governance |
(As of March 15, 2025)
Other Public Company Directorships (past 5 years): None. Other Background: Mr. McLaughlin has served as the President and Chief Technology Officer of Mastercard and a member of the company’s executive committee since 2017. He oversees the company’s technology functions, including the global payments network, enterprise platforms, technology infrastructure and operations, information security, and global technology hubs. Prior to this role, he served as Chief Information Officer, directing the development of Mastercard products and services. Prior to joining Mastercard in 2005, Mr. McLaughlin was group Vice President of products and strategy at Metavante (now FIS) which he joined in 2002 through the acquisition of Paytrust, an online payments company of which he was co-founder and CEO. Prior to co-founding Paytrust, Mr. McLaughlin was the Executive Vice President of products and marketing at LogicWorks, Inc., a data modeling software company. He is a graduate of the University of Pennsylvania, Wharton School of Business, and a founding member of the Harvard Kennedy School’s Council on the Responsible Use of Artificial Intelligence. Mr. McLaughlin was awarded the Forbes CIO Innovation Award for 2019, and named to the CIO Magazine Hall of Fame in 2024.
(As of March 15, 2025)
| | John J. Roese Age: 54 Director since: 2024 Occupation: Chief Technology Officer and Chief AI Officer at Dell Technologies Education: B.S., University of New Hampshire Board Committees: Audit, Finance |
(As of March 15, 2025)
Other Public Company Directorships (past 5 years): None Other Background: Mr. Roese has served as President and Global Chief Technology Officer of Dell Technologies since 2019. In this role, Mr. Roese is responsible for establishing the company’s future-looking technology strategy and fostering a culture of innovation to ensure Dell Technologies is at the forefront of the industry. Mr Roese is also Dell’s Chief AI Officer responsible for driving Dell’s AI strategy and internal use of AI. Mr. Roese was Chief Technology Officer at Dell Technologies and EMC Corporation from 2012 to 2019. Prior to joining Dell EMC in 2012, Mr. Roese was the CTO, GM, and a leader of several technology companies including EMC, Nortel, Broadcom, Futurewei, Enterasys, and Cabletron Systems. Mr. Roese is an established conference speaker, published author, and holds more than 20 pending and granted patents in areas such as policy-based networking, location-based services, and security. Mr. Roese has been active on numerous boards, including ATIS, OLPC, Blade Networks, Pingtel, Nexoya, Bering Media, Cloud Foundry Foundation, NYU Wireless Industry Advisory Board, and the Federal Communications Commission (FCC) Communications Security, Reliability, and Interoperability Council. He currently serves on the Open Secure Software Foundation board of directors, and on the Purdue Research Foundation / Purdue University Lab to Life Technology Leaders Advisory Board.
(As of March 15, 2025)
| | Amy Schwetz Age: 50 Director since: 2024 Occupation: SVP & Chief Financial Officer of Flowserve Education: B.S., Accounting, Indiana University Board Committees: Audit (Chair), Compensation and Human Capital |
(As of March 15, 2025)
Other Public Company Directorships (past 5 years): Dril-Quip (NYSE: DRQ). Other Background: Ms. Schwetz has served as SVP & Chief Financial Officer of Flowserve, a manufacturer of industrial equipment and aftermarket service provider, since 2020. In this role, she oversees accounting, tax, treasury, investor relations, financial planning and analysis, internal audit, and M&A activity. From 2005-2020, Ms. Schwetz held various management roles at Peabody Energy Corporation, where she most recently served as EVP & Chief Financial Officer. Ms. Schwetz began her career at Ernst & Young, where she held multiple audit roles during her tenure. She served as a member of the board of directors of Dril-Quip, Inc. between September 2019 and May 2024, where she also served as chair of the audit committee. Ms. Schwetz serves on the Jesuit Dallas Foundation Board of Trustees (not-for-profit) and has served as a member of the Dean’s Council for the Indiana University School of Business.
2024 Compensation of Directors
2024 Compensation of Directors Compensation for our directors is determined by the Corporate Governance Committee and approved by the full Board. Directors who are our employees receive no additional compensation for serving as a director. Accordingly, Messrs. Bandrowczak and Bruno did not receive any additional compensation for their service on the Board during 2024. For each year of board service (which is measured from the date of one annual meeting until the next annual meeting), each non-employee director is eligible to receive an annual cash retainer of $85,000 and an annual equity award with a grant date fair value of $225,000. In addition, the independent (non-executive) Chairman of the Board receives an additional $100,000 in cash and $50,000 in equity. The following amounts are payable in respect of committee service by non-employee directors for the board service year: •$35,000 to the chair of the Audit Committee •$15,000 to each member of the Audit Committee (other than the chair) •$30,000 to the chair of the Compensation and Human Capital Committee •$12,500 to each member of the Compensation and Human Capital Committee (other than the chair) •$25,000 to the chair of the Corporate Governance Committee •$20,000 to the chair of the Finance Committee •$10,000 to members of the Corporate Governance Committee and Finance Committees (other than the chairs of such committees). There is an annual total compensation cap of $750,000 for each non-employee director. Because we have an independent Chairman of the Board, we do not have a Lead Independent Director. In February 2024, the Board approved a new director compensation program under which directors receive their cash retainer and all committee fees in the form of cash paid on a quarterly basis in arrears. Directors currently receive their annual equity retainer in the form of restricted stock units (“RSUs”), unless they elect to receive deferred stock units (“DSUs”), with such election to be made prior to the year in which the DSUs are earned. DSUs and RSUs are issued under the Xerox Holdings Corporation 2024 Equity and Performance Incentive Plan (the “2024 Plan”), which was approved by Xerox Holdings Corporation shareholders at the 2024 Annual Meeting of Shareholders. RSUs generally vest one year following the date of grant and are paid out in shares of Common Stock within 30 days of the vesting date. DSUs generally vest one year following the date of grant but are not paid out until 30 days following a director’s termination of Board service. If there is a change in control of the Company, the terms of the 2024 Plan provide that all DSUs and RSUs held by directors shall become vested and paid in cash as soon as practicable following such change in control. Beginning with the 2025-2026 Board service year, directors will have the option to elect to receive up to 100% of their cash compensation in the form of additional RSUs or DSUs, as applicable. Directors also receive cash reimbursement for out-of-pocket expenses incurred in connection with their service on the Board. Vested DSUs include the right to receive dividend equivalents, which are credited in the form of additional DSUs, at the same time and in approximately the same amounts that the holder of an equivalent number of shares of Common Stock would be entitled to receive in dividends. Vested RSUs (which are issued in the form of Common Stock following vesting) receive regular cash dividends at the same time and in the same amount as other shareholders. Dividend equivalents are not credited with respect to DSUs or RSUs that have not vested; however, when DSUs or RSUs initially vest, they are credited with dividend equivalents equal to the dividends that would have been paid during the vesting period. DSU dividend equivalents are paid in the form of additional DSUs, and RSU dividend equivalents are paid in the form of cash. All non-employee directors are required to establish a meaningful equity ownership interest in the Company, which is currently equal in value to three times the annual Board cash retainer. This requirement must be achieved within three years of the initial date of election as director and may be achieved by a director holding RSUs, DSUs, or a combination of both. Each of our directors has either complied with this requirement, or has not completed three years of service on the Board and is working toward being compliant with this requirement by the time they complete three years of service. Each director is prohibited from engaging in short-swing trading and trading in puts and calls with respect to Xerox stock and is prohibited from using any strategies or products to hedge against potential changes in the value of Xerox stock (collectively, hedging). “Short sales” are also prohibited. Under the Company’s insider trading policy, directors are permitted to sell Xerox securities only if they have entered into trading plans pursuant to SEC Rule 10b5-1, and are permitted to buy Xerox securities only with prior approval from the Chief Legal Officer. In addition, under the Company’s insider trading policy, directors are prohibited from pledging Xerox stock, including depositing Xerox securities in margin accounts at brokerage firms, or using Xerox stock as collateral.
Director Compensation
Director Compensation Individually, the compensation for each non-employee director during 2024 was as follows:
Director Compensation
| Name of Director | Fees Earned or Paid in Cash $(2) | Stock Awards $(3)(4) | Option Awards $ | Non-Equity Incentive Plan Compensation $ | Change in Pension Value and Non-Qualified Deferred $ | All Other Compensation $ | Total $ | | Tami A. Erwin (1) | 31,250 | 225,000 | — | — | — | — | 256,250 | | Priscilla Hung (1) | 26,250 | 225,000 | — | — | — | — | 251,250 | | Scott Letier | 53,750 | 225,000 | — | — | — | — | 278,750 | | Nichelle Maynard-Elliott | 32,500 | 225,000 | — | — | — | — | 257,500 | | Edward G. McLaughlin (1) | 26,875 | 225,000 | — | — | — | — | 251,875 | | John Roese (1) | 27,500 | 225,000 | — | — | — | — | 252,500 | | Amy Schwetz (1) | 33,125 | 225,000 | — | — | — | — | 258,125 |
Director Compensation
________ (1) Mses. Erwin, Hung and Schwetz and Messrs. McLaughlin and Roese each joined the Board effective as of May 22,2024 at the conclusion of our 2024 annual meeting. (2) Represents the amount of cash paid in 2024. (3) The value of compensation awarded in the form of DSUs or RSUs is reflected in this column. The amount presented in this column reflects the aggregate grant date fair value of the DSUs and RSUs awarded during 2024, computed in accordance with FASB ASC Topic 718, Compensation — Stock Compensation, and excludes dividend equivalents accrued during the period. A discussion of the assumptions used in calculating the fair value of such awards may be found in Note 23 (Stock-Based Compensation) to our 2024 audited financial statements of our Annual Report on Form 10-K filed with the SEC on February 24, 2025. We award DSUs and/or RSUs annually on the date of our annual meeting of shareholders. The DSUs and/or RSUs awarded are intended to cover the period from one annual meeting to the next annual meeting, rather than the fiscal year in which they were awarded, and the DSUs and RSUs fully vest when the director completes the year of service from one annual meeting to the next annual meeting. (4) In accordance with applicable SEC rules, dividend equivalents accrued in 2024 on DSUs and RSUs are not included in the Director Compensation table because those amounts were factored into the grant date fair values of the DSUs and RSUs. For information on compensation for Mr. Bandrowczak, a director and the CEO of Xerox, and Mr. Bruno, a director and President and Chief Operating Officer of Xerox, see the Summary Compensation Table.
LETTER FROM THE COMMITTEE CHAIR
LETTER FROM THE COMMITTEE CHAIR Dear Fellow Shareholder, In 2023, the Board and management of Xerox Holdings Corp. (Xerox) announced Reinvention, a three-year plan to optimize our business, while also positioning Xerox to expand into adjacent growth markets. As noted briefly below, in 2024 – the second year of our multi-year Reinvention plan – a series of organizational changes designed to drive future growth at Xerox were implemented successfully. The Board and management of Xerox believe that the successful execution of our Reinvention is critical to our success as a public company, and we need our workforce to remain focused and motivated throughout this process. As a reflection of the role human capital will play in the success of the Company's Reinvention and the Compensation Committee's expanded role in managing the same, the Compensation Committee changed its name in 2024 to the Compensation & Human Capital Committee. Xerox’s Compensation & Human Capital Committee is committed to working with our shareholders to ensure the Company’s compensation plans support our business objectives, align with shareholders’ interests, and continue to motivate and retain talented executives. I am pleased to report that in 2024 we: •Restructured our business to better meet our clients’ needs, moving from a geographically-led organization to a business unit led organization. •Simplified our geographic presence by exiting or switching to a partner-led distribution model in certain international markets. •Established Global Business Services (GBS), to function as the central nervous system of Xerox, enabling enterprise-wide efficiencies and productivity gains by continuously seeking ways to optimize how we work. •Successfully achieved gross cost savings target of more than $200 million envisioned by Reinvention. •Acquired ITsavvy LLC in an earnings accretive transaction that supports the Company’s strategy to expand its IT Services business. •Entered into an agreement to acquire Lexmark International, Inc., in an earnings accretive transaction, which improves our core print business and increases our total addressable market (TAM) with exposure to the growing APAC market. Alongside these achievements we also welcomed six new directors to our Board. Each of these highly qualified individuals has applied their operational expertise to fostering a culture of innovation and continuous improvement. To support our Reinvention in 2024, we kept Adjusted(1) EBITDA as the sole financial metric in our management incentive plan (MIP) but increased its weighting from 60% to 90%. The employee long-term incentive plan (LTIP) was also redesigned with 50% comprised of three-year cliff vested Performance Share Units ( PSUs) tied to adjusted(1) operating income improvement of $300 million through 2026, and the remaining balance comprised of Restricted Stock Units (RSUs) that vest ratably over three years. Additionally, the relative TSR metric in our LTIP became a modifier, which can affect the LTIP payout by +/- 25%, based on our performance versus the S&P 600 Info Tech Index. As a committee, we focus on maintaining a compensation program that aligns with our shareholders’ interests. We continuously work to match our compensation programs with drivers of profitability, sustainable growth, and value creation for our shareholders. Our “say-on-pay” proposal can be found on page 27 of this Proxy Statement. The Board recommends that you vote “FOR” this proposal in support of Reinvention. We also invite you to consider additional information about our compensation philosophy and decisions in the Compensation Discussion and Analysis section, which appears in the following pages of this Proxy Statement. I am confident that our executive compensation program supports our strategy, secures our talent, and drives long-term shareholder value creation. We value the opinions of our shareholders. As has been our practice, when the Compensation & Human Capital Committee approaches future compensation decisions, it will reflect on the outcome of the “say-on-pay” proposal vote at this year’s Annual Meeting of Shareholders. Thank you for your consideration. Sincerely, Nichelle Maynard-Elliott Chair, Compensation & Human Capital Committee (1) Refer to the “Non-GAAP Financial Measures” section for a reconciliation of this non-GAAP financial measure or an explanation of the performance measure.
Executive Compensation Best Practices
| What We Do | What We Don’t Do | | ✓ Emphasize pay for performance to align executive compensation with our business strategy and promote creation of long-term shareholder value. ✓ Use multiple sources of data including peer group and survey information as reference points to assess total target compensation. ✓ Require double-trigger vesting of equity awards upon a change in control. ✓ Recover from executive officers the amount of any erroneously awarded incentive-based compensation in the event of an accounting restatement. ✓ Impose clawback provisions enabling recovery of compensation, in the event of detrimental activity. ✓ Maintain stock ownership holding requirements for executive officers. ✓ Require non-compete and non-solicitation agreements during employment and post-employment, as permissible under local law. ✓ Provide minimal executive perquisites. ✓ Design compensation programs with controls to mitigate risk. ✓ Engage an independent compensation consultant that advises the Committee on executive compensation and non-employee director compensation matters. ✓ Conduct continuous shareholder outreach to discuss matters related to executive compensation and corporate governance. | ✗ NO payment of dividends or dividend equivalents before RSUs are vested or PSUs are earned. Additionally, no payment of dividends or dividend equivalents on stock options. ✗ NO accrual of additional benefits under our non-qualified pension plans, which were frozen in 2012, and no Company contributions under our non-qualified deferred compensation plan, which was closed to new contributions after 2018. ✗ NO payment of tax gross-ups on perquisites other than in connection with relocation and tax equalization for international assignment allowances. ✗ NO excise tax gross-ups in change-in-control arrangements. ✗ NO hedging or pledging of Xerox stock by executive officers. ✗ NO employment agreements (unless customary under applicable law or in connection with new hire arrangements). |
Compensation Structure
| Type of Pay | Purpose | Key Characteristics | | Base Salary | | | | Fixed | •Fixed cash compensation based on the individual’s experience, skills, and competencies, relative to competitive market value of the role. | •Reflects competitive market conditions and individual performance. •Commensurate with scope of responsibility, internal value of the position, and impact to the Company, reflecting internal pay equity. | | Annual Cash Incentive (MIP) | | | | Performance-Based | •Variable cash compensation motivates achievement of annual strategic goals, as measured by objective, pre-established financial and strategic metrics. | •Target opportunities are based on market data and reflect impact to the Company. •Metrics are intended to drive consistent growth by measuring successful execution of our current strategy. •Continued inclusion of CSR metric underscores the importance of our environment, safety, and people in a measurable and objective way. •Actual awards are based on achievement of measurable performance targets. | | Long-Term Incentives (LTIP) | | | | Restricted Stock Units (RSUs) | •Aligns with market practice. •Promotes retention in a highly competitive marketplace. | •Comprises 50% of LTI grant. •Graded service-based vesting schedule (33.33%, 33.33% and 33.34%, on the first, second, and third anniversaries of the grant date). | | Performance Share Units (PSUs) | •Aligns compensation with key indicators of success of our strategy. •Encourages focus on long-term shareholder value creation through profitable growth and increase in stock price over time. •Promotes retention through long-term performance achievement and vesting requirements. | •Comprises 50% of LTI grant. •Cliff vesting three-years from grant date. •Payouts based on achieving performance metrics reflecting creation of shareholder value. |
Competitive Market Information
Competitive Market Information Each year, the Committee receives and reviews a report comparing all elements of compensation for our NEOs with the compensation of the NEOs from companies in our peer group. The Committee reviews the peer group total target compensation for each NEO. The competitive peer group market data is prepared, analyzed, and presented to the Committee by FW Cook, the Committee’s independent compensation consultant. FW Cook also provides a broader set of survey data that is size-adjusted to reflect companies of similar revenue scope. When setting compensation, the Committee also reviews the Company’s performance in relation to the peer group as well as individual performance and contributions by each NEO.
2024 Peer Group
2024 Peer Group The Committee regularly reviews the composition of the compensation peer group, and makes modifications as appropriate. Significant changes were made to the peer group since 2022 to better align with our Reinvention and future initiatives. The 2024 peer group was approved in October 2023, following an assessment and guidance from FW Cook. The Committee relied on the following factors when evaluating the appropriateness of the peer group: •Comparable in size (considering revenue, market capitalization, enterprise value, and other size metrics); •Comparable in terms of business complexity and industry focus; •Companies with which Xerox is likely to compete for executive talent; and/or •Companies that share a similar business model and/or similar business content in one or more areas to our traditional business, as well as our changing business model through our business reinvention. The following peer group was approved by the Committee and was used in determining 2024 pay decisions.
2024 Peer Group
| 2024 Peer Group | | | | CDW Corporation | Motorola Solutions, Inc. | Trimble Inc. | | CGI Inc. | NCR Corporation(1) | Western Digital Corporation | | Ciena Corporation | NetApp, Inc. | Zebra Technologies Corporation | | CommScope Holding Company, Inc. | OpenText Corporation | | | DXC Technology Company | Sanmina Corporation | | | Juniper Networks, Inc. | Seagate Technology Holdings plc | | | Keysight Technologies, Inc. | Teledyne Technologies Incorporated | |
2024 Peer Group
(1) For NCR Corporation, our 2025 Peer Group now reflects their split into NCR Voyix Corporation and NCR Atleos Corporation.
Total Target Compensation
| | Annual Base Salary ($)(1) | Target MIP (% of Salary)(1) | Target MIP ($)(1) | LTIP (RSUs and Target PSUs) ($) | Total Target Compensation (Base + Target MIP + LTIP) ($) | | Steven J. Bandrowczak | 1,100,000 | 170% | 1,870,000 | 11,400,000 | 14,370,000 | | John Bruno | 850,000 | 150% | 1,275,000 | 7,200,000 | 9,325,000 | | Xavier Heiss(2) | 673,198 | 100% | 673,198 | 3,600,000 | 4,946,396 | | Louis J. Pastor | 625,000 | 100% | 625,000 | 2,760,000 | 4,010,000 | | Jacques-Edouard Gueden(2) | 528,941 | 100% | 528,941 | 2,640,000 | 3,697,882 |
Target Pay Mix
Target Pay Mix The charts below show the 2024 pay mix for our NEOs, and the portion of their total compensation that is at risk. The target pay in the charts represents base salary, target MIP incentive awards, and grants of LTIP incentive awards at target (which include a PSU and RSU component). •93% of pay for our CEO is at risk and creates alignment with shareholders •88% of pay for our other NEOs is at risk and creates alignment with shareholders
Setting MIP Targets and Determining Payout
Setting MIP Targets and Determining Payout The following chart shows our annual process for setting MIP targets and determining payout of the prior year’s awards. This process typically takes place in the first quarter of each year.
Setting MIP Targets and Determining Payout
| Role | Responsibility | | Board of Directors | •Reviews Company results for prior year •Considers annual operating plan for the current year | | CEO | •With the Chief Financial Officer (CFO), assesses prior-year performance •Recommends actions related to payment of awards based on prior-year performance •Recommends to the Committee performance measures for the current year •Recommends establishment of MIP incentive target awards for the current year for the other NEOs | | Compensation & Human Capital Committee | •With the input of the CEO and CFO, assesses prior-year performance against goals •Prior to Committee approval, CFO certifies prior-year performance results •With the input of the CEO, determines awards earned for the prior year •Sets performance measures and weightings for the current year, including the threshold, target and maximum goals for each measure, payout ranges, potential adjustment categories, and overall design |
Setting LTIP Targets and Determining Grants
Setting LTIP Targets and Determining Grants The following chart shows our annual process for setting LTIP targets and determining grants. This process typically takes place in the first quarter of each year.
Setting LTIP Targets and Determining Grants
| LTIP Planning Process | | | Actions the Compensation & Human Capital Committee takes annually with respect to LTIP awards | •For completed performance periods, determines the number of PSUs, if any, earned by each NEO based on the results for the performance period •For the new PSU cycle, establishes overall design, performance measures and weightings; threshold, target, and maximum achievement levels for each measure with associated payout ranges | | Specific actions taken for 2024 LTIP Grants | •Approved new LTIP grant values and grant dates for NEOs •Approved program design, performance measures and weightings; set threshold, target, and maximum achievement levels for each measure with associated payout ranges |
Process for Determining MIP and LTIP Results and Payouts
Process for Determining MIP and LTIP Results and Payouts After the completion of each fiscal year, the CFO certifies the financial results used by the Committee to make compensation decisions. The CFO attends Committee meetings to discuss financial targets and results for the annual MIP and the LTIP as described in the CD&A. Executive officer compensation decisions are made by the Committee after discussing recommendations with the CEO and the EVP, Chief Transformation & Administrative Officer. The Committee meets in executive session to review and recommend to the Board CEO compensation actions.
MIP
MIP •Each performance measure is assessed and calculated independently. The weighted results of each measure, if achieved at least at the threshold level, are added together to determine the overall payout factor. •Subject to the Committee’s review and approval, any material unusual or infrequent charges or gains/(losses) may be excluded from the MIP calculations in order to obtain normalized operational results of the business. •Even if pre-established performance measures are achieved, the Committee retains the discretion to adjust the calculated incentive payout, as it deems appropriate, based on overall Xerox performance. The Committee may use its discretion to adjust a payout based on individual performance, provided that an individual executive’s award never exceeds the MIP cap of 2.5 times the executive’s target award opportunity.
LTIP
LTIP •Performance results for each PSU performance metric, subject to that metric’s weighting, are combined to determine the number of PSUs earned, as a percentage of the target number of PSUs awarded. •Payouts are made proportionately for achievement between threshold and target, and between target and maximum. No PSUs are earned if performance is below the threshold level for all of the performance metrics established by the Committee. Payout of PSUs is conditioned on actual achievement of the pre-established performance measures and satisfaction of all vesting requirements. •The target numbers of PSUs and RSUs granted to our NEOs were determined by dividing the approved LTIP grant-date values (dollar amount) by the closing stock price on the grant date (or last trading day prior to the grant date if the market was closed on the grant date). •Any earned PSUs are paid as shares, as soon as practicable following the later of such approval or the PSU vesting date.
Performance Metrics, Results and Payout: 2024 MIP
Performance Metrics, Results and Payout: 2024 MIP The 2024 MIP principal financial metric of Adjusted(1) EBITDA remained consistent with 2023, reflecting a continued focus on business growth goals throughout the second year of our transformation journey. An increased weighting of 90% was intended to further enhance alignment with our Reinvention strategy. A comparison between our 2024 and 2023 MIP metrics are as follows:
Performance Metrics, Results and Payout: 2024 MIP
| 2024 Metrics | Weight | 2023 Metrics (*) | Weight | | Adjusted(1) EBITDA | 90% | Adjusted(1)(2) EBITDA | 60% | | ESG | 10% | ESG | 20% | | - Environmental: GHG Reduction | | - Environmental: GHG Reduction | | | - Employee Engagement Training | | - Safety: Workplace Safety | | | | | - Social: Improve Rep of women/diversity | | | | | Business/Functional | 20% | | | | *CEO metrics: 80% Adjusted(1) EBITDA / 20% ESG | |
Performance Metrics, Results and Payout: 2024 MIP
For 2024, we achieved between threshold and target performance for Adjusted(1) EBITDA, or 71.9%. When weighted, Adjusted(1) EBITDA contributed 64.7% to the MIP payout factor. For ESG, performance was achieved at maximum, or 250%. When weighted, ESG contributed 25.0% to the MIP payout factor. The Committee evaluated performance relative to the following ESG metrics: Environmental GHG Reduction (5%) and Employee Engagement Training (5%). The combined weighted payout factor for both 2024 MIP metrics was 89.7%. 2024 included successful advancements against Reinvention priorities; however, due to the underperformance of Adjusted(1) EBITDA, the principal financial metric, as well Xerox's total shareholder return as compared to the peer group, management recommended and the Committee approved the application of negative discretion to reduce the 2024 MIP payout factor to 70.0% of target. All NEOs maintained the same weighting of performance metrics, and received the same payout factor. Refer to the Corporate Social Responsibility section above for additional information regarding our 2024 ESG metric. ________ (1) Refer to the “Non-GAAP Financial Measures” section for a reconciliation of this non-GAAP financial measure. (2) Mr. Pastor's MIP payout for 2023 was based solely on 100% Adjusted(1) EBITDA on actual results. For 2024, the final MIP payout was between threshold and target levels with a total payout of 70.0% of target for NEOs. A summary of the 2024 MIP results are as follows:
2024 MIP Results (in millions, except % data)
2024 MIP Results (in millions, except % data)
2024 MIP Results (in millions, except % data)
| Performance Measure | Weight | Threshold (50% payout) | Target (100% payout) | Maximum (250% payout) | Actual 2024 Performance Results | Payout Range (Payout Factor) | Weighted Payout Factor | | Adjusted(1) EBITDA | 90% | $350 | $700 | $800 | $503 | Between Threshold & Target (71.9%) | 64.7% | | ESG | 10% | — | — | — | 250.0% | Max (250.0%) | 25.0% | | Total | 100% | | | | | | 89.7% |
2024 MIP Results (in millions, except % data)
Total payout factor for the 2024 MIP performance measures (and weightings) for each NEO were as follows:
2024 MIP Results (in millions, except % data)
| Executive | Adjusted(1) EBITDA (90%) | ESG (10%) | Formulaic Payout Factor | Total Payout Factor(2) | | Steven J. Bandrowczak | 64.7% | 25.0% | 89.7% | 70.0% | | John Bruno | 64.7% | 25.0% | 89.7% | 70.0% | | Xavier Heiss | 64.7% | 25.0% | 89.7% | 70.0% | | Louis J. Pastor | 64.7% | 25.0% | 89.7% | 70.0% | | Jacques-Edouard Gueden | 64.7% | 25.0% | 89.7% | 70.0% |
2024 MIP Results (in millions, except % data)
(1) Refer to the “Non-GAAP Financial Measures” section for an explanation of this non-GAAP financial measure. (2) Management recommended and the Committee and Board of Directors approved reduced payouts for all executives as a result of Company performance.
2024 MIP Payout
2024 MIP Payout
2024 MIP Payout
| Executive | Target MIP Incentive ($) | Formulaic Payout Factor | Actual 2024 MIP Payout ($) | | Steven J. Bandrowczak | 1,870,000 | 70.0% | 1,269,333 | | John Bruno | 1,275,000 | 70.0% | 857,500 | | Xavier Heiss(1) | 638,264 | 70.0% | 446,785 | | Louis J. Pastor | 625,000 | 70.0% | 437,500 | | Jacques-Edouard Gueden(1) | 499,340 | 70.0% | 349,538 |
2024 MIP Payout
________ (1) Mr. Heiss’ and Mr. Gueden's base salaries are denominated and paid in EUR. The amounts shown above in USD reflect the average exchange rate of 1.04855 EUR per USD for December 31, 2024. Mr. Heiss' and Mr. Gueden's 2024 MIP payouts are calculated using four months of their 2023 base salaries and eight months of their 2024 base salaries.
Performance Metrics, Results and Payout: 2024 LTIP
Performance Metrics, Results and Payout: 2024 LTIP Our LTIP awards are granted annually, and the 2024 LTIP awards were made under the Xerox Holdings Corporation Performance Incentive Plan as Amended as of May 25, 2023. Our 2024 LTIP design included awards granted in the form of performance share units (PSUs) (50%), and time-vesting restricted stock units (RSUs) (50%). The grant date for these awards was March 11, 2024, to closely align with the underlying performance period for the PSUs. In alignment with our Reinvention initiatives for 2024, the Committee approved the 2024 PSU metric, Adjusted(1) operating income improvement. Performance for this metric is contingent upon meeting predetermined, annual as well as cumulative Adjusted(1) operating income improvement goals established for three annual performance periods (2024, 2025, 2026), each weighted 20%, respectively, and a three-year cumulative goal (2024-2026) weighted 40%. In addition, the 2024 PSU also includes a Relative Total Shareholder Return (rTSR) metric. This metric is based on Xerox's stock price appreciation, inclusive of dividends paid, measured over three equally weighted performance periods (2024, 2024-2025, and 2024-2026). rTSR will be determined by comparing Xerox and the companies within the S&P 600 Information Technology Index, for each of the three performance periods. Performance for this portion of the 2024 PSU will be determined based on the average rTSR of the three measurement periods, and based on these results, the rTSR modifier can increase or decrease the number of shares that ultimately vest by 25%. Final payout will be determined based on the cumulative results of the four individually weighted measurement periods of Xerox’s Adjusted(1) operating income improvement metric, and depending on the rTSR performance, a potential increase or decrease of 25%. In no event can the total PSU payout exceed 200% of the original shares granted. Earned PSUs cliff-vest three years from the grant date, subject to the Committee’s certification of performance results. RSUs vest 33.33% on the first anniversary of the grant date, 33.33% on the second anniversary of the grant date, and 33.34% on the third anniversary of the grant date. Following the vesting of RSUs and the later of any earned and vested PSUs, dividend equivalents are paid in cash on vested shares in an amount equal to the dividends the executive would have received had the executive owned the same number of shares of Xerox Common Stock throughout the vesting period. The 2024 performance measures and weightings for our LTIP were:
2024 LTIP
2024 LTIP
2024 LTIP
| Vehicle | Mix | Performance Measure | Weighting | Performance Period | Vesting | Rationale | | Performance Share Units (PSUs) | 50% | Adjusted (1) Operating Income Improvement | 100% | Three annual performance periods (2024, 2025, 2026) each weighted 20%, respectively, and a cumulative performance period (2024-2026) weighted 40% | Cliff vesting on the third anniversary of the grant date (subject to performance results) | Focuses on stock price appreciation and achieving goals to maximize shareholder returns (inclusive of accumulated dividends), which is appropriate during the organization’s Reinvention | | | | rTSR S&P 600 Information Technology Index | +/- 25% | | | | | Restricted Stock Units (RSUs) | 50% | Service-based | NA | Three one-year vesting periods from date of grant | Vesting schedule of 33.33%, 33.33%, and 33.34%, on the first, second, and third anniversaries of the grant date, respectively | Aligns with market practice and promotes retention in a highly competitive marketplace |
2024 LTIP
________ (1) Refer to the “Non-GAAP Financial Measures” section for a reconciliation of the non-GAAP financial measure or an explanation of the performance measure.
2024 LTIP Target Values
2024 LTIP Target Values
2024 LTIP Target Values
| Executive | 2024 LTIP ($) | PSUs (50%) ($) | RSUs (50%) ($) | | Steven J. Bandrowczak | 11,400,000 | 5,700,000 | 5,700,000 | | John Bruno | 7,200,000 | 3,600,000 | 3,600,000 | | Xavier Heiss | 3,600,000 | 1,800,000 | 1,800,000 | | Louis J. Pastor | 2,760,000 | 1,380,000 | 1,380,000 | | Jacques-Edouard Gueden | 2,640,000 | 1,320,000 | 1,320,000 |
2024 New Hire LTIP Awards
2024 New Hire LTIP Awards In January, Mr. Pastor received a $2.7 million new hire RSU grant. See reference in the Grants of Plan-Based Awards section and January 5, 2024 8-K filing.
Performance Results and Payout: 2022 LTIP
Performance Results and Payout: 2022 LTIP The 2022 LTIP metric, Cumulative Adjusted(1) Earnings per Share (EPS), is based on the cumulative results of three discrete performance periods: fiscal year 2022, 2023, and 2024. In 2024, the Committee approved a modification to the 2022 LTIP definition, removing a discrete threshold disallowing the impact of share repurchases greater than two percent of adjusted(1) EPS. This modification was approved by the Committee to address the impact of the share purchase agreement with Carl C. Icahn and certain of his affiliates, which occurred in September 2023 and which management did not contemplate when setting annual goals for this metric. Despite the modification, threshold performance level was not met for the Adjusted(1) Earnings per Share metric. The Committee did not approve any further modification to address challenges to the business to ensure that executive pay remained aligned with the shareholder experience. Similarly, threshold performance level was not met for the Absolute Share Price(1) metric, resulting in no payout under the 2022 LTIP. For additional information on the 2022 LTIP performance measures and definitions, refer to Exhibit 10(f)(22) of the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2021, filed with the SEC on February 23, 2022. A summary of results for the 2022 LTIP performance is as follows:
2022 PSU Results
2022 PSU Results
2022 PSU Results
| Performance Measure | Weight | Threshold (50% payout) | Target (100% payout) | Maximum (200% payout) | Actual 2022 PSU Award Performance Results | Weighted Payout Factor | | Cumulative Adjusted(1) Earnings per Share | 50% | $4.50 | $5.62 | $6.74 | $2.07 | 0% | | Absolute Share Price(1) | 50% | $20 | $25 | $30 | $11.80 | 0% | | Actual 2022 LTIP PSU Award Performance Factor | | | | | | 0% |
Looking Ahead to 2025
Looking Ahead to 2025 As previously discussed, the Reinvention journey is underway and key components critical to the success of the plan include the MIP and LTIP. Consistent with shareholder feedback, the Committee has taken the following actions for 2025: 1.MIP Design: Leveraging the success of the MIP design in 2023 and into 2024 to drive behaviors and align pay with performance, we are continuing with Adjusted(1) EBITDA as our sole financial metric, weighted at 90%. We believe that Adjusted(1) EBITDA remains appropriate as it strongly correlates with TSR, and incentivizes the Company's operational profitability. Corporate Social Responsibility (CSR), formerly named Environmental Social Governance (ESG) in 2024, remains a key priority and component of Xerox's strategy and culture, and will be incorporated into MIP metrics, weighted at 10%. The two 2025 CSR goals are related to Enterprise Sustainability and Employee Learning and Development, each weighted 5%. We believe the inclusion of CSR priorities in the MIP design is critical to align with shareholder and stakeholder interests. 2.LTIP Design: The 2025 LTIP design maintains Adjusted(1) Operating Income as the primary financial metric. It continues to align long-term incentives with our initiative to drive adjusted(1) operating income over the performance period. This PSU metric represents 50% of the LTIP design, while the other 50% of the LTIP is in the form of an RSU. Additionally, we are maintaining the relative TSR metric modifier in our LTIP which can affect the LTIP payout by +/- 15%, based on our performance versus the S&P 600 Information Technology Index. Similar to the 2024 LTIP awards, PSUs are subject to three-year cliff, performance-based vesting, and RSUs are subject to a three-year service-based vesting. (1) Refer to the “Non-GAAP Financial Measures” section for a reconciliation of the non-GAAP financial measure and an explanation of the performance measure.
Role of Independent Compensation Consultant
Role of Independent Compensation Consultant The Committee has retained the services of an independent compensation consulting firm, FW Cook, to assist with its responsibilities. The compensation consultant generally attends Committee meetings and provides advice to the Committee. The compensation consultant also meets regularly with Committee members without management being present. FW Cook reports only to the Committee and has not performed any other work for the Company since being retained as an independent consultant to the Committee or as directed by the Committee Chair. As provided in its charter, the Committee has the authority to determine the scope of FW Cook’s services and may terminate the engagement at any time. The Committee reviewed FW Cook’s independence under SEC and Nasdaq rules, and determined there was no conflict of interest. During fiscal year 2024, FW Cook provided the following services: •Regularly updated the Committee on trends in executive compensation and proactively advised on emerging trends and best practices on performance and compensation design; •Reviewed officer compensation levels and the Company’s overall performance compared to a peer group made up of organizations with which the Company is likely to compete for executive expertise and/or which share with the Company a similar business model in one or more areas; •Reviewed incentive compensation designs for MIP and LTIP programs; •Advised the Committee on peer group companies for pay and performance comparisons; •Reviewed the Compensation Discussion and Analysis and related compensation tables for this Proxy Statement; •Reviewed Committee meeting materials with management and the Committee Chair before distribution; •Attended Committee meetings and, as requested, meetings in executive session; •Offered independent analysis and input on CEO compensation; and •Advised on other compensation and governance matters as required.
CHANGE IN CONTROL BENEFITS
CHANGE IN CONTROL BENEFITS All our current NEOs have change-in-control severance agreements. The Committee has determined that these agreements are in the best interests of both the Company and our shareholders because they foster the continuous employment and dedication of key management without potential distraction or personal concern if Xerox were the potential subject of an acquisition or other change-in-control event. The Committee periodically reviews our change-in-control severance agreements against benchmark data to ensure that our arrangements are consistent with market practice. Under the change-in-control severance agreements, if employment terminates involuntarily (other than for cause, death, or disability) or voluntarily for Good Reason within two years following a change in control, the NEO would be entitled to: •Two times the sum of their annual base salary and target annual incentive award; •Continuation of specified welfare benefits at active employee rates for a period of 18 to 24 months, as applicable; and •Accelerated vesting of outstanding equity awards if change in control is triggered under the Xerox Holdings Corporation 2024 Equity and Performance Incentive Plan. These agreements require that the executive agree to remain an employee of the Company for nine months following a “potential change in control” (as defined therein) or until the date upon which the NEO is first entitled to receive the benefits described above, if earlier. Severance payments to NEOs following a change in control are generally not conditioned on non-competition or non-solicitation obligations. Good Reason is defined in the change-in-control severance agreements. Xerox does not provide any of the NEOs with excise tax reimbursement on severance payments. Additional information and the amount of the estimated payments and benefits payable to the NEOs (assuming a change in control of Xerox and a qualifying termination of employment) are presented under the Potential Payments Upon Termination or Change in Control table.
EMPLOYMENT AND SEPARATION
EMPLOYMENT AND SEPARATION NEOs serve at the will of the Board. This enables the Board to remove an NEO, consistent with applicable laws, whenever it is in the best interests of the Company, with discretion of the Committee to decide on an appropriate severance package (except for benefits that have vested or in the case of a change in control). When an NEO is removed from his or her position, the Committee exercises its business judgment in determining whether any special severance arrangement is appropriate considering all relevant circumstances, including years of service with the Company, past accomplishments, the reasons for separation, and requirements under applicable local law. In March 2024, the Committee approved an amendment and restatement of the Officer Severance Program (OSP), which was originally established effective July 2018, and subsequently amended effective January 2020, February 2021, and December 2022 (the Prior OSP, and, as amended and restated, the A&R OSP or the Officer Severance Program). Under the Officer Severance Program, an officer who is eligible to participate in the program due to a qualifying termination as defined therein will be entitled to receive: •One year (two years for Mr. Bandrowczak) of severance paid over 12 months (24 months for Mr. Bandrowczak) and continuation of specified health and welfare benefits at active employee rates; •Prorated annual incentive award for the year of termination; and •At the Committee’s discretion, continued vesting of outstanding equity awards during the one-year (two-year for Mr. Bandrowczak) severance period. The A&R OSP amended the Prior OSP to (i) extend the termination date of the program from December 31, 2024 to December 31, 2026, (ii) add a “termination for good reason” as a payment trigger for eligible officers serving as the Chief Executive Officer or the President and Chief Operating Officer of the Company, and (iii) provide for continued vesting of any outstanding equity awards under the Company’s 2024 Equity and Performance Incentive Plan for eligible officers serving as the Chief Executive Officer or the President and Chief Operating Officer of the Company, in the event of such officer’s “termination for good reason” or any involuntary termination other than for “cause.” The Officer Severance Program includes a covenant not to engage in activity that is detrimental to the Company, and payments and benefits under the program are conditioned upon the NEO’s execution of a release of claims against the Company, and a non-competition/non-solicitation agreement. The NEOs are generally eligible for the Officer Severance Program, except that the Officer Severance Program: (1) excludes from eligibility an officer with a written agreement providing for severance benefits upon separation; and (2) contains a non-duplication provision, pursuant to which payments and benefits under the Officer Severance Program are reduced by amounts required to be paid to the officer as severance under another arrangement or by operation of law. Thus, the treatment of Messrs. Heiss and Gueden under the Officer Severance Program would be as follows: •Any amounts payable to Messrs. Heiss or Gueden would be reduced by the severance benefits received under the Convention Collective d’Enterprise Xerox S.A.S. (10 December 2015) (XF-CBA), a collective bargaining agreement between the Company’s French subsidiary and certain French trade unions (XF-CBA). (See the Potential Payments Upon Termination or Change in Control section for further information.) Except as described above, if the Committee does not approve a severance arrangement under the Officer Severance Program for an NEO whose employment is terminated, that officer would be covered under the Company’s standard U.S. severance policy, as applicable at the time of the separation.
Compensation Recoupment (Clawback) Policy
Compensation Recoupment (Clawback) Policy The Company adopted the Compensation Recoupment Policy of Xerox Holdings Corporation (the Clawback Policy) on July 27, 2023, effective December 1, 2023. The Recoupment Policy is intended to comply with the requirements of Section 10D of the Securities Exchange Act of 1934 and Rule 10D-1 thereunder and Nasdaq Listing Rule 5608. Under the terms of the Recoupment Policy, in the event of a restatement of our financial statements due to material non-compliance with any financial reporting requirement under applicable securities laws, the Committee shall take reasonably prompt action to cause the Company to recover the amount of any incentive compensation granted, awarded or paid to a covered person within the preceding 36-month period to the extent the value of such compensation was in excess of the amount of incentive compensation that would have been granted, awarded or paid had the financial statements been in compliance with the financial reporting requirements. Each executive officer, including our Named Executive Officers and former executive officers, are considered covered persons for purposes of the Recoupment Policy. In addition, the following plans provide for compensation recovery. •The Officer Severance Program (see Employment and Separation) and, typically, any individual separation arrangement with an NEO, includes a provision that rescinds severance payments if the recipient engages in activity that is detrimental to the Company. Clawback arrangements may also be included in letter agreements with executives or under the Company's standard U.S. severance policy, as applicable at the time of the separation. •Under the 2004 Performance Incentive Plan and its successors, the Xerox Holdings Corporation Performance Incentive Plan, as Amended Through October 21, 2021, and the Xerox Holdings Corporation 2024 Equity and Performance Incentive Plan (collectively the EPIP) if the Committee determines that an NEO has engaged in activity that is detrimental to the Company, it may cancel any awards granted to that individual. In addition, if such a determination is made before any change in control of Xerox, the Committee may rescind any payment or delivery of an equity or annual cash incentive award that occurred from six months before the detrimental activity. For this purpose, detrimental activity may include: ◦A violation of a non-compete agreement with the Company; ◦Disclosing confidential information (except for reporting and other communications protected by “whistle blower” provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd Frank)); ◦Soliciting an employee to terminate employment with the Company; ◦Soliciting a customer to reduce its level of business with the Company; or ◦Engaging in any other conduct or act that is determined to be injurious, detrimental, prejudicial, or which may cause reputational harm, to any interest of the Company. If a payment or award is rescinded, the NEO will be expected to pay the Company the amount of any gain realized, or payment received in a manner the Committee, or its delegate, requires. •Our LTIP PSU equity award agreements, as governed by the EPIP, incorporate by reference the Recoupment Policy adopted by the Company effective December 1, 2023. Pursuant to the Recoupment Policy, in the event of an accounting restatement, the Company can recover, for the three prior years, any excess incentive-based compensation (over what would have been paid under the accounting restatement) from executive officers or former executive officers. •Annual incentive awards to NEOs under the MIP are also subject to the above clawback provisions. •Under the Xerox Corporation Supplemental Savings Plan, if a participant, including an NEO, is found to have engaged in detrimental activity, the plan administrator may reduce or rescind the matching contribution account balance and not pay such amounts to that individual.
Equity Award Timing Policies and Practices
Equity Award Timing Policies and Practices We do not grant equity awards in anticipation of the release of material nonpublic information, and we do not time the release of material nonpublic information based on equity award grant dates or for the purpose of affecting the value of executive compensation. In addition, we do not take material nonpublic information into account when determining the timing and terms of such awards. Although we do not have a formal policy with respect to the timing of our equity award grants, the Committee has historically granted such awards on a predetermined annual schedule. In fiscal 2024, we did not grant new awards of stock options, stock appreciation rights, or similar option-like instruments to our NEOs.
SUMMARY COMPENSATION TABLE
SUMMARY COMPENSATION TABLE The Summary Compensation Table below provides compensation information for the CEO, the CFO, and the next three most highly compensated executive officers who served during the fiscal year ended December 31, 2024. The table includes the dollar value of base salary earned, bonus, stock and option awards, non-equity incentive plan compensation earned, change in pension value (if any) above-market non-qualified deferred compensation earnings (if any) and all other compensation (including severance and consulting payments) whether paid or deferred. For a summary of the Committee’s decisions on the compensation awarded to our NEOs for fiscal 2024, please refer to the CD&A beginning on page 25.
Summary Compensation Table
Summary Compensation Table Compensation elements reported in this Summary Compensation table and its accompanying notes, are in U.S. dollars and rounded to the nearest dollar. For Messrs. Heiss and Gueden, compensation other than stock awards are denominated and paid in euros; the amount shown in U.S. dollars for other than the Change in Pension Value and NQDC, for which the exchange rate is described in the narrative following the Pension Benefits for the 2024 Fiscal Year table, reflects the December average exchange rates, EUR per USD, as follows: •1.0485 EUR per USD for 2024 •1.0903 EUR per USD for 2023 •1.0573 EUR per USD for 2022
Summary Compensation Table
| Name & Principal Position | Year | Salary ($) (A) | Bonus ($) (B) | Stock Awards ($) (C) | Option Awards ($) (D) | Non-Equity Incentive Plan Compensation ($) (E) | Change in Pension Value and NQDC Earnings ($) (F) | All Other Compensation ($) (G) | Total ($) | | Steven J. Bandrowczak Chief Executive Officer | 2024 | 1,066,667 | — | 11,879,791 | — | 1,269,333 | — | 104,851 | 14,320,642 | | | 2023 | 1,000,000 | — | 8,556,086 | — | 3,278,700 | — | 9,900 | 12,844,686 | | | 2022 | 763,315 | — | 7,100,017 | — | 679,929 | — | 18,006 | 8,561,267 | | John Bruno President and Chief Operating Officer | 2024 | 816,667 | | 7,503,038 | | 857,500 | | 10,350 | 9,187,555 | | | 2023 | 750,000 | — | 4,499,898 | — | 2,064,188 | — | 31,223 | 7,345,309 | | | 2022 | 99,432 | — | 3,000,003 | — | — | — | 938 | 3,100,373 | | Xavier Heiss Executive Vice President, Chief Financial Officer | 2024 | 640,953 | | 3,751,537 | | 446,785 | 1,073,675 | 290,225 | 6,203,175 | | | 2023 | 576,258 | — | 3,178,745 | — | 1,266,464 | 197,405 | 208,923 | 5,427,795 | | | 2022 | 500,997 | — | 2,500,033 | — | 372,144 | 174,439 | 156,133 | 3,703,746 | | Louis J. Pastor, Executive Vice President, Chief Transformation and Administrative Officer | 2024 | 622,735 | | 5,576,209 | | 437,500 | | 4,679 | 6,641,123 | | | 2023 | 187,500 | — | 2,548,511 | — | 1,452,000 | — | 422,981 | 4,610,992 | | | 2022 | 537,500 | — | 1,900,044 | — | 355,825 | — | 95 | 2,793,464 | | Jacques-Edouard Gueden Executive Vice President, Chief Channel and Partner Officer(1) | 2024 | 501,619 | — | 2,751,129 | — | 349,538 | 638,891 | 149,470 | 4,390,647 |
Summary Compensation Table
________ (1) Mr. Gueden was not an NEO prior to 2024. (A)Salaries are in USD. (B)Annual MIP awards appear as “Non-Equity Incentive Plan Compensation” in column E. (C)The amounts shown in this column represent the aggregate grant date fair values of equity awards in the form of PSUs and RSUs granted to our NEOs for each respective year, computed in accordance with FASB ASC Topic 718, Compensation — Stock Compensation. A discussion of the assumptions used in calculating the fair value of such awards may be found in Note 23 (Stock-Based Compensation) to our 2024 audited financial statements of our Annual Report on Form 10-K filed with the SEC on February 24, 2025. The grant date fair value reported in this column with respect to PSU awards, granted on March 11, 2024, is based on the number of shares granted at target and the fair value as determined by a Monte Carlo valuation ($18.29). The grant-date fair value of these PSU awards at maximum performance would be as follows: Mr. Bandrowczak — $12,359,578; Mr. Bruno — $7,806,063; Mr. Heiss — $3,903,050; Mr. Pastor — $2,992,354, and Mr. Gueden — $2,862,239. The value reported in this column with respect to RSU awards is based on the number of shares granted at target and the grant date closing market price of $16.87. (D)Stock options were not granted in 2022, 2023, or 2024. (E)The Non-Equity Incentive Plan payments under the 2024 MIP, based on 2024 performance, were approved by the Committee in February 2025. Actual payout as a percentage of target was 70% of target. For more information, see the Performance Metrics, Results and Payout: 2024 MIP section in the CD&A. (F)Messrs. Heiss and Gueden participate in the Retirement Indemnities Plan, a French pension plan that we are required to maintain under a collective agreement with our employees in France. The change in pension value shown in this column is calculated by determining the change in the present value of the benefits from December 31, 2023 to December 31, 2024 (but if the change in the present value of the benefit is negative, then it is not shown). The present value is computed using the FASB ASC Topic 715 assumptions in effect for the corresponding fiscal year end, and assuming the benefit is paid at the earliest retirement date at which unreduced benefits are payable upon eligible retirement age. See the Pension Benefits for the 2024 Fiscal Year section for more detail. •For Messrs. Heiss and Gueden in 2024 — these assumptions include a discount rate of 3.10% for the Retirement Indemnities Plan, and a social charge rate of 47.5%. The Retirement Indemnities Plan does not pay any benefits to a participant who terminates employment before eligible retirement age. (G)The table below entitled “All Other Compensation Table” provides additional data on the amounts included under the “All Other Compensation” column.
GRANTS OF PLAN-BASED AWARDS IN 2024
GRANTS OF PLAN-BASED AWARDS IN 2024 The following table provides additional detail regarding RSUs and PSUs granted to each of the NEOs under the 2024 LTIP and potential amounts payable under the 2024 MIP. Threshold, target, and maximum award opportunities are provided for PSUs and the MIP, as applicable. 2024 LTIP awards were made under the PIP.
GRANTS OF PLAN-BASED AWARDS IN 2024
| | | | | Estimated Future Payout Under Non-Equity Incentive Awards (B) | | | Estimated Future Payout Under Equity Incentive Awards (C) | | | All Other Stock Awards: Number of Shares or Stock Units (#) (D) | Grant Date Fair Value of Stock Awards ($) (E) | | Name | Award | Grant Date (A) | Date of Action (A) | Thresh. ($) | Target ($) | Max ($) | Thresh. (#) | Target (#) | Max (#) | | | | Steven J. Bandrowczak | 2024 MIP | | | 935,000 | 1,870,000 | 4,675,000 | | | | | | | | 2024 LTIP (PSU) | 3/11/2024 | 3/11/2024 | | | | 168,939 | 337,878 | 675,756 | | 6,179,789 | | | 2024 LTIP (RSU) | 3/11/2024 | 3/11/2024 | | | | | | | 337,878 | 5,700,002 | | John Bruno | 2024 MIP | | | 637,500 | 1,275,000 | 3,187,500 | | | | | | | | 2024 LTIP (PSU) | 3/11/2024 | 3/11/2024 | | | | 106,699 | 213,397 | 426,794 | | 3,903,031 | | | 2024 LTIP (RSU) | 3/11/2024 | 3/11/2024 | | | | | | | 213,397 | 3,600,007 | | Xavier Heiss | 2024 MIP | | | 336,599 | 673,198 | 1,682,996 | | | | | | | | 2024 LTIP (PSU) | 3/11/2024 | 3/11/2024 | | | | 53,350 | 106,699 | 213,398 | | 1,951,525 | | | 2024 LTIP (RSU) | 3/11/2024 | 3/11/2024 | | | | | | | 106,699 | 1,800,012 | | Louis J. Pastor | 2024 MIP | | | 312,500 | 625,000 | 1,562,500 | | | | | | | | 2024 LTIP (PSU) | 3/11/2024 | 3/11/2024 | | | | 40,902 | 81,803 | 163,606 | | 1,496,177 | | | 2024 LTIP (RSU) | 3/11/2024 | 3/11/2024 | | | | | | | 81,803 | 1,380,017 | | | 2024 Re-hire (RSU) | 1/4/2024 | 1/4/2024 | | | | | | | 162,946 | 2,700,015 | | Jacques-Edouard Gueden | 2024 MIP | | | 264,471 | 528,941 | 1,322,354 | | | | | | | | 2024 LTIP (PSU) | 3/11/2024 | 3/11/2024 | | | | 39,123 | 78,246 | 156,492 | | 1,431,119 | | | 2024 LTIP (RSU) | 3/11/2024 | 3/11/2024 | | | | | | | 78,246 | 1,320,010 |
GRANTS OF PLAN-BASED AWARDS IN 2024
________ (A)The “Grant Date” is the effective date of the equity awards. The “Date of Action” is the date on which the values of the awards were approved by the Committee and, for Mr. Bandrowczak, the Board of Directors. (B)These columns reflect the threshold, target, and maximum payout opportunities under the 2024 MIP set by the Committee. The MIP measures and weightings for 2024 were Adjusted(1) EBITDA (90%) and ESG (10%). For purposes of this table, the amount shown as the “threshold” payout was determined assuming achievement of the minimum performance level. If threshold performance was not achieved on the performance measures, there would be no MIP payout. For 2024, the MIP payout was 70.0% of target. See Performance Metrics, Results and Payout: 2024 MIP in the CD&A. (C)The threshold, target, and maximum payout opportunities for the 2024 LTIP PSU awards, as well as the design and methodology for determining the 2024 LTIP PSU awards, were approved by the Committee. The target number of PSUs granted to each of our NEOs was determined by dividing the approved LTIP target award value by the closing market price of Xerox Common Stock on the grant date (or last trading day prior to the grant date if the market was closed on the grant date) and rounding up to the nearest whole share. The performance measure for the portion of the 2024 LTIP award granted as PSUs is Adjusted(1) Operating Income Improvement. In addition to the performance measure, Relative TSR (S&P 600 Information Technology Index) was included in the design as a +/- 25% modifier to Adjusted(1) Operating Income Improvement results. PSUs under the 2024 LTIP can be earned by achieving three-year performance goals at least at the threshold level. The performance period for the Adjusted(1) Operating Income Improvement measure, and the Relative TSR modifier, is January 1, 2024 through December 31, 2026. The service period and vesting date for the PSUs is three years from the grant date; earned PSUs will be determined and paid after the 2026 performance results have been certified by the CFO and approved by the Committee. The threshold column reflects the lowest number of PSUs that could be earned if performance is achieved at the threshold level for the Adjusted(1) Operating Income Improvement performance measure. If threshold performance is not achieved on the performance measures, no PSUs are earned. See Committee Actions Relating to LTIP Awards in the CD&A for additional information. The target column reflects the number of PSUs that could be earned if target performance is achieved on the performance measure. The maximum column reflects the greatest number of PSUs that could be earned if maximum or higher performance is achieved on the performance measure. The number of PSUs earned is interpolated if the Company’s performance is between threshold and target or between target and maximum, as determined by the Committee. (D)This column includes the LTIP RSU awards granted to our NEOs in 2024. 2024 LTIP RSUs will vest 33.33% on the first anniversary of the grant date, 33.33% on the second anniversary of the grant date, and 33.34% on the third anniversary of the grant date. The number of RSUs granted was determined by dividing the approved award value by the closing market price on the grant date (or the last trading day before the grant date if the stock market was closed on the grant date) and rounding up to the nearest whole share. (E)The grant date fair value reported in this column with respect to PSU awards reported in column (C) is based on the number of shares granted at target and the fair value as determined by a Monte Carlo valuation ($18.29). The value reported in this column with respect to RSU awards reported in column (D) is based on the number of shares granted at target and the grant date closing market price of $16.87 as described in footnote (D). (1) Refer to the “Non-GAAP Financial Measures” section for a reconciliation of the non-GAAP financial measure or an explanation of the performance measure.
OUTSTANDING EQUITY AWARDS AT 2024 FISCAL YEAR-END
OUTSTANDING EQUITY AWARDS AT 2024 FISCAL YEAR-END The following table displays unvested equity awards held by each of the NEOs on December 31, 2024:
OUTSTANDING EQUITY AWARDS AT 2024 FISCAL YEAR-END
| | Option Awards | | | | Stock Awards | | | | | Name | Number of Securities Underlying Unexercised Options Exercisable (#) (A) | Number of Securities Underlying Unexercised Options Unexercisable (#) (B) | Option Exercise Price ($) | Option Expiration Date | Number of Shares or Units of Stock That Have Not Vested (#) (C) | Market Value of Shares or Units of Stock That Have Not Vested ($) (C) | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#) (D) | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($) (D) | | Steven J. Bandrowczak | 41,990 | — | 24.00 | 7/1/2028 | 579,587 | 4,885,918 | 626,848 | 5,284,329 | | John Bruno | — | — | — | — | 285,226 | 2,404,455 | 330,529 | 2,786,359 | | Xavier Heiss | 12,349 | — | 27.98 | 4/5/2028 | 183,591 | 1,547,672 | 231,541 | 1,951,891 | | Louis J. Pastor | — | — | — | — | 244,749 | 2,063,234 | 81,803 | 689,599 | | Jacques-Edouard Gueden | 6,861 | — | 27.98 | 4/5/2028 | 121,251 | 1,022,146 | 146,700 | 1,236,681 |
OUTSTANDING EQUITY AWARDS AT 2024 FISCAL YEAR-END
________ (A)The awards presented in this column reflect exercisable LTIP stock options granted in 2018. (B)There are no stock options that are unexercisable. (C)The awards presented in these columns include unvested RSUs (as of December 31, 2024). The value of these awards is based on the $8.43 closing market price of Xerox Common Stock on December 31, 2024, the last trading day of 2024. These columns include the following awards: 2024 RSUs: Unvested RSUs granted on January 4, 2024, as part of a new hire award, as follows: Mr. Pastor — 162,946. Unvested RSUs granted on March 11, 2024, as part of the 2024 LTIP, as follows: Mr. Bandrowczak — 337,878; Mr. Bruno — 213,397; Mr. Gueden — 78,246; Mr. Heiss — 106,699; and Mr. Pastor — 81,803. The vesting schedule of these RSUs is 33.33% on the first anniversary, 33.33% on the second anniversary, and 33.34% on the third anniversary of the grant date. 2023 RSUs: Unvested RSUs granted on January 18, 2023, as part of the 2023 LTIP, as follows: Mr. Bandrowczak — 119,714; Mr. Bruno — 71,829; Mr. Gueden — 22,347; and Mr. Heiss — 41,501. The vesting schedule of these RSUs is 33% on the first anniversary, 33% on the second anniversary, and 34% on the third anniversary of the grant date. Unvested RSUs granted on January 19, 2023, as part of the retention awards approved by the Committee as follows: Mr. Bandrowczak — 38,317; Mr. Gueden — 12,597; and Mr. Heiss — 20,996. The vesting schedule of these RSUs is 40% on the first anniversary and 60% on the second anniversary of the grant date. Remaining unvested RSUs granted on January 12, 2022, as part of the 2022 LTIP, as follows: Mr. Bandrowczak — 23,607; Mr. Gueden — 8,061; and Mr. Heiss — 14,395. The vesting schedule of these RSUs is 33% on the first anniversary, 33% on the second anniversary, and 34% on the third anniversary of the grant date. Remaining unvested RSUs granted on August 2, 2022, as part of Mr. Bandrowczak's August 2, 2022 promotion -- 60,071. The vesting schedule of these RSUs is 33% on the first anniversary, 33% on the second anniversary, and 34% on the third anniversary of the grant date. (D)The awards presented in these columns consist of unearned PSUs (as of December 31, 2024), and are shown at target. The number of PSUs earned, if any, is determined by the Committee’s approval of certified performance results for the relevant performance period. The value of these awards is based on the $8.43 closing market price of Xerox Common Stock on December 31, 2024, the last trading day of 2024. PSU awards granted as part of the 2024 LTIP on March 11, 2024, to Mr. Bandrowczak — 337,878; Mr. Bruno — 213,397; Mr. Gueden — 78,246; Mr. Heiss — 106,699; and Mr. Pastor — 81,803, These awards vest three years from the grant date, with the number of shares to be earned, if any, based on achievement of the applicable performance metrics. The performance period is January 1, 2024 through December 31, 2026. 2023 PSUs: PSU awards granted as part of the 2023 LTIP on January 18, 2023, to Mr. Bandrowczak — 195,220; Mr. Bruno — 117,132; Mr. Gueden — 36,441; and Mr. Heiss — 67,677. These awards vest three years from the grant date, with the number of shares to be earned, if any, based on achievement of the applicable performance metrics. The performance period is January 1, 2023 through December 31, 2025. 2022 PSUs: PSU awards granted as part of the 2022 LTIP on January 12, 2022, to Mr. Bandrowczak — 93,750; Mr. Gueden — 32,013; and Mr. Heiss — 57,165. These awards vest three years from the grant date, with the number of shares to be earned, if any, based on achievement of the applicable performance metrics. The performance period is January 1, 2022 through December 31, 2024. These PSU awards resulted in zero payout because neither of the two performance metrics were achieved at the threshold level. See Performance Results and Payout: 2022 LTIP in the CD&A. Additional detail on these awards can be found in the Performance-Based Executive Long-Term Incentive Program sections of the CD&A.
OPTION EXERCISES AND STOCK VESTED IN 2024
OPTION EXERCISES AND STOCK VESTED IN 2024 The following table shows amounts realized by the NEOs upon the vesting of stock awards during 2024. Messrs. Bandrowczak, Gueden, and Heiss, held exercisable stock options during 2024, but none were exercised.
OPTION EXERCISES AND STOCK VESTED IN 2024
| | Stock Awards | | | Name | Number of Shares Acquired on Vesting (#) (A) | Value Realized on Vesting ($) (B) | | Steven J. Bandrowczak | 186,903 | 2,644,509 | | John Bruno | 132,717 | 1,377,062 | | Xavier Heiss | 60,013 | 959,848 | | Louis J. Pastor | — | — | | Jacques-Edouard Gueden | 34,399 | 564,476 |
OPTION EXERCISES AND STOCK VESTED IN 2024
________ (A)This column includes shares attributable to RSUs and PSUs that vested under the 2021, 2022, and 2023 LTIP. All shares are potentially subject to a holding period. NEOs must retain at least 50% of the shares acquired through the vesting of their annual LTIP PSU and RSU awards, net of taxes, until they achieve their required level of ownership under our stock ownership guidelines. Once achieved, NEOs must continue to hold that amount of stock as long as they remain with the Company. They also remain subject to a holding requirement following separation from employment (including retirement). Refer to Stock Ownership Requirements section above, within this CD&A. (B)The aggregate dollar amount realized upon vesting includes the value of shares withheld to pay taxes.
PENSION BENEFITS FOR THE 2024 FISCAL YEAR
PENSION BENEFITS FOR THE 2024 FISCAL YEAR The following table reflects information regarding our NEOs’ estimated benefits under the defined benefit pension plans in which they participate, if any, as of December 31, 2024. None of our NEOs, other than Mr. Heiss and Mr. Gueden, participate in any defined benefit pension plans.
PENSION BENEFITS FOR THE 2024 FISCAL YEAR
| Name | Plan Name | Number of Years of Credited Service (#) | Present Value of Accumulated Benefit ($) | Payments During Last Fiscal Year ($) | | Steven J. Bandrowczak | — | — | — | — | | John Bruno | — | — | — | — | | Xavier Heiss (A) | Retirement Indemnities Plan | 36 | 1,905,461 | — | | Louis J. Pastor | — | — | — | — | | Jacques-Edouard Gueden (A) | Retirement Indemnities Plan | 35 | 1,210,566 | — |
PENSION BENEFITS FOR THE 2024 FISCAL YEAR
(A)Pension benefits were accrued by Mr. Heiss and Mr. Gueden under the Retirement Indemnities Plan during 2024. The present value of the accumulated benefit is the present value of their accumulated benefits payable at the plan’s earliest unreduced eligible retirement age. The critical assumptions are the: (i) discount rate of 3.10%; (ii) social charge rate of 47.5%; and (iii) exchange rate of 1.0407 EUR per USD, the December 31, 2024 average exchange rate. The plan pays benefits only as a lump sum, calculated as monthly pay times a multiple, ranging from 0 to 8 based on years of service, plus the social charges on this payment. Monthly pay is one-twelfth of annual base salary plus annual incentive. At 36 years of service, the multiple of monthly salary is 7.75 and at 35 years of service the multiple is 7.50.
NON-QUALIFIED DEFERRED COMPENSATION FOR THE 2024 FISCAL YEAR
NON-QUALIFIED DEFERRED COMPENSATION FOR THE 2024 FISCAL YEAR The Non-Qualified Deferred Compensation table discloses executive and employer contributions, as applicable, withdrawals and earnings, if any, and fiscal year-end balances under the Defined Contribution Pension Plan for Directors of Xerox SAS, France (French DC Plan). Mr. Heiss and Mr. Gueden participated in the French DC Plan during 2024 as shown below. None of our NEOs, other than Mr. Heiss and Mr. Gueden, had any amounts deferred pursuant to a non-qualified deferred compensation plan or arrangement as of December 31, 2024.
NON-QUALIFIED DEFERRED COMPENSATION FOR THE 2024 FISCAL YEAR
| Name | Plan Name | Executive Contributions in Last FY ($) | Registrant Contributions in Last FY ($) | Aggregate Earnings in Last FY ($)(A) | Aggregate Withdrawals/ Distributions ($) | Aggregate Balance at Last FYE ($) | | Steven J. Bandrowczak | SSP | — | — | — | — | — | | John Bruno | SSP | — | — | — | — | — | | Xavier Heiss | DC France(B) | 2,509 | 7,528 | — | — | 279,297 | | Louis J. Pastor | SSP | — | — | — | — | — | | Jacques-Edouard Gueden | DC France(B) | 2,509 | 7,528 | — | — | 278,633 |
NON-QUALIFIED DEFERRED COMPENSATION FOR THE 2024 FISCAL YEAR
________ (A)No portion of the amounts shown in this column is reported as above-market interest in the Summary Compensation Table. (B)The French DC Plan is denominated and paid in EUR. The amounts shown as contributions in USD reflect the 2024 average exchange rate of 1.0823, EUR per USD. The aggregate balance reflects the spot rate of 1.0407 EUR per USD as of December 31, 2024.
POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL
POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL Xerox has entered into certain agreements and maintains certain plans that require the Company to provide compensation to NEOs in the event of a termination of employment or a change in control. The table below reflects the amount of compensation payable to each NEO assuming that each of the hypothetical termination or change-in-control events listed in the table occurred on December 31, 2024. The equity award values presented in this table reflect unvested grants held by the applicable NEO as of December 31, 2024, and are based on the closing market price of Xerox Common Stock of $8.43 as of December 31, 2024, the last trading day in 2024.
POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL
| Name | Lump Payments ($) | Non- Equity Incentive Awards ($) | Equity Incentive Awards ($) | Healthcare/ Life Insurance / Other Benefits ($) | Total Termination Benefit ($) | | Steven J. Bandrowczak | | | | | | | Voluntary Termination/Retirement (A) | — | — | — | — | — | | Involuntary Termination not for Cause or for Good Reason (B) | 2,200,000 | 1,269,333 | 10,170,244 | 26,765 | 13,666,342 | | Involuntary or Good Reason Termination after Change in Control (C) | 5,940,000 | — | 10,170,244 | 26,765 | 16,137,009 | | Death (D) | — | 1,269,333 | 10,170,244 | — | 11,439,577 | | John Bruno | | | | | | | Voluntary Termination/Retirement (A) | — | — | — | — | — | | Involuntary Termination not for Cause or for Good Reason (B) | 850,000 | 857,500 | 5,190,629 | 18,906 | 6,917,035 | | Involuntary or Good Reason Termination after Change in Control (C) | 4,250,000 | — | 5,190,629 | 37,812 | 9,478,441 | | Death (D) | — | 857,500 | 5,190,629 | — | 6,048,129 | | Xavier Heiss | | | | | | | Voluntary Termination/Retirement (A) | — | — | 2,036,275 | — | 2,036,275 | | Involuntary Termination not for Cause (B) | 946,648 | 446,785 | 2,899,909 | 153,888 | 4,447,230 | | Involuntary or Good Reason Termination after Change in Control (C) | 2,692,792 | — | 3,499,561 | 167,890 | 6,360,243 | | Death (D) | — | 446,785 | 3,499,561 | 2,333,609 | 6,279,955 | | Louis J. Pastor | | | | | | | Voluntary Termination/Retirement (A) | — | — | — | — | — | | Involuntary Termination not for Cause (B) | 625,000 | 437,500 | 2,120,924 | 10,297 | 3,193,721 | | Involuntary or Good Reason Termination after Change in Control (C) | 2,500,000 | — | 2,752,833 | 15,445 | 5,268,279 | | Death (D) | — | 437,500 | 2,752,833 | — | 3,190,333 | | Jacques-Edouard Gueden | | | | | | | Voluntary Termination/Retirement (A) | — | — | 1,243,686 | — | 1,243,686 | | Involuntary Termination not for Cause (B) | 528,941 | 349,538 | 1,819,084 | 153,888 | 2,851,452 | | Involuntary or Good Reason Termination after Change in Control (C) | 2,115,764 | — | 2,258,827 | 167,890 | 4,542,481 | | Death (D) | — | 349,538 | 2,258,827 | 2,333,609 | 4,941,974 |
POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL
Upon the termination events listed above, in addition to the benefits reflected in the above table, each NEO would also be entitled to the balance of his deferred compensation account, if any, under our non-qualified deferred compensation plans. Deferred compensation balances are reported in the “Aggregate Balance at Last FYE” column of the Non-Qualified Deferred Compensation table above. In accordance with SEC rules, the table above reflects estimated severance payments and benefits to which our NEOs would be entitled upon hypothetical termination events occurring on December 31, 2024. These amounts reflect estimates only, and actual payments and benefits to which an NEO may be entitled upon termination of employment with the Company depend upon a number of factors not reflected in the table. (A)As of December 31, 2024, Messrs. Bruno and Pastor were not retirement eligible, and would not receive any payments in the event of voluntary termination. Messrs. Bandrowczak, Gueden and Heiss are retirement eligible under the terms of our equity award agreements and, in the event of their retirement on December 31, 2024, would receive prorated vesting of outstanding equity awards (based on the number of full months of service as an employee during the vesting period commencing on the grant date), including PSUs based on actual performance results but reflected at target performance for purposes of the table. (B)Under the Company’s Officer Severance Program (as described in the Employment and Separation section of the CD&A), Messrs. Bruno, Gueden, Heiss, and Pastor would each receive payment equal to one year (for Mr. Bandrowczak, two years) of their current annual base salary. Although the amounts reported in the table above assume such benefit is paid as a lump sum, it is generally paid periodically, consistent with the normal payroll cycle. In addition, each of these NEOs would receive: •Under the terms of the Officer Severance Program, the NEO’s annual incentive (Non-Equity Incentive Award) for 2024, based on actual achievement against performance goals (as described in the 2024 Compensation Actions section of the CD&A), prorated through last day of active service; •Messrs. Bandrowczak's and Bruno's equity award agreements provide continued vesting of any outstanding equity awards in the event of involuntary termination without Cause or Good Reason. For all other NEOs, equity award agreements provide prorated vesting of outstanding equity awards, with such proration based on the number of full months of service as an employee during the vesting period (including, at the Committee’s discretion, the one-year severance period). PSU awards would be earned based on actual performance but the table above reflects target performance. The table above assumes proration through the end of the severance period; and •Continuation of specified welfare benefits at active employee rates during the one-year severance period (two-years for Mr. Bandrowczak, if allowed under specific plans). These payments and benefits would be conditioned upon the NEO’s execution of a release of claims against the Company and a non-competition/non-solicitation agreement. Neither Mr. Heiss nor Mr. Gueden would receive a benefit under the Officer Severance Program due to the program’s provision for non-duplication of benefits. Mr. Heiss and Mr. Gueden would instead receive benefits under the Convention Collective d’Enterprise Xerox S.A.S. (10 December 2015) (XF-CBA), a collective bargaining agreement between the Company’s French subsidiary and certain French trade unions. Under the XF-CBA, Mr. Heiss and Mr. Gueden would be entitled to a 3-month notice period during which their base salary and benefits would continue and at the end of which they would receive a dismissal indemnity equal to 12 months of their monthly average gross salary (the calculation of which would include their actual 2024, short-term incentive payment, and certain other amounts paid to him during 2024). In addition, Mr. Heiss and Mr. Gueden would receive: •Annual incentive (Non-Equity Incentive Award) for 2024, based on actual achievement against performance goals (as described in the 2024 Compensation Actions section of the CD&A); •Under the terms of our equity award agreements, prorated vesting of outstanding equity awards, with such proration based on the number of full months of service as an employee during the vesting period (including the 3-month notice period and, at the Committee’s discretion, any applicable salary continuance/dismissal indemnity period). PSU awards would be earned based on actual performance, but the table above reflects target performance. The table above assumes proration through the end of the 15-month notice / dismissal indemnity period; and •Continuation of specified welfare benefits for up to a one-year period following the end of the 3-month notice period. (C)Change-in-Control (CIC) severance agreements for Messrs. Bandrowczak, Bruno, Gueden, Heiss, and Pastor provide the following severance benefits in the event of an involuntary termination (other than for cause, disability, or death) or a voluntary termination for Good Reason within two years following a CIC (in either case, a “qualifying termination”): •Lump-sum cash payment equal to two times the sum of annual base salary and annual incentive award target; •Continuation of specified welfare benefits at active employee rates for 18 to 24 months, as applicable; •Payment of reasonable legal fees and expenses incurred if the NEO, in good faith, is involved in a dispute while seeking to enforce the benefits and rights provided by the CIC severance agreement; and •In addition, pursuant to the terms of the 2004 Performance Incentive Plan and its successor plan, the Xerox Holdings Corporation Performance Incentive Plan, as Amended Through October 21, 2021, in the event of a change in control as defined therein, these NEOs would be entitled to full vesting of outstanding equity awards. The CIC severance agreements for Messrs. Bandrowczak, Bruno, Gueden, Heiss, and Pastor each contain an offset provision, pursuant to which payments and benefits are reduced by any payments or benefits required to be paid to the NEO as severance, or during a notice period, under any other agreement or program or by operation of law. Thus, in the event of a qualifying termination that is also an involuntary termination under the Officer Severance Program or, as applicable, the XF-CBA, Messrs. Bandrowczak, Bruno, Gueden, Heiss, and Pastor would receive the payments described in (B) above for an Involuntary Termination Not for Cause, and would receive payments or benefits under their CIC severance agreements only to the extent the CIC severance agreements provided for greater amounts. For all of the NEOs, if excise tax under Code Sections 280G and 4999 would be payable, the Company will reduce the NEO’s CIC payment to a level that will not trigger such excise tax, if it is determined that doing so will result in a greater net after-tax amount for the NEO. (D)In the event of an NEO’s death, the NEO’s estate (or, with respect to certain types of payments and elections made, the NEO’s spouse) would receive: the NEO’s 2024 short-term incentive, based on actual achievement against performance goals; accelerated vesting of outstanding equity awards; and, for Mr. Heiss and Mr. Gueden, payment of their vested pension benefits, if any, in accordance with the plan’s terms and the proceeds of a life insurance policy per the XF-CBA.
CEO PAY RATIO
CEO PAY RATIO In accordance with Section 953(b) of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2012 and SEC rules adopted thereunder, the Company is disclosing the ratio of the annual total compensation of the Chief Executive Officer, Mr. Bandrowczak, to the annual total compensation of the Company’s median employee (excluding the Chief Executive Officer). We have identified a new median employee since our 2023 pay ratio calculation because there have been changes to our employee population over the last year which would result in a change to our pay ratio disclosure for fiscal 2024. We identified our median compensated employee using our employee population as of November 30, 2024 using annual total cash compensation as our Consistently Applied Compensation Measure (CACM) for all of our employees. Total cash compensation for these purposes included base salary, annual incentive compensation, any cash commission payments, change in pension value, overtime, and mandated wages paid through December 31, 2024. Once the median employee was identified applying our CACM methodology, we calculated the median employee total 2024 annual compensation of $53,149 using the same components of compensation as used in the Summary Compensation Table for our NEOs. This total compensation amount was then compared to the total compensation of the CEO disclosed in the Summary Compensation Table in the amount of $13,842,342. Based on this information for 2024, the ratio of the CEO’s annual total compensation to the median employee’s annual total compensation was 260 to 1. The SEC rules for identifying the median employee and calculating the pay ratio based on that employee’s annual total compensation allow companies to adopt a variety of methodologies, to apply certain exclusions, and to make reasonable estimates and assumptions that reflect their compensation practices. As such, the pay ratio reported by other companies may not be comparable to the pay ratio reported here, as other companies may have different employment and compensation practices and may utilize different methodologies, exclusions, estimates, and assumptions in calculating their own pay ratios.
PAY VERSUS PERFORMANCE
PAY VERSUS PERFORMANCE Pursuant to Section 953(a) of the Dodd-Frank Act and Item 402(v) of SEC Regulation S-K, we are providing the following information about the relationship between executive “compensation actually paid” (or CAP) to the Company’s principal executive officer (PEO) and non-PEO named executive officers (the Non-PEO NEOs), and certain aspects of the financial performance of the Company. The Committee does not utilize CAP as the basis for making compensation decisions. For further information concerning our compensation philosophy and how we align executive compensation with our performance, please see our Compensation Discussion & Analysis.
Pay Versus Performance Table
Pay Versus Performance Table
Pay Versus Performance Table
| | | | | | | | Value of Initial Fixed $100 Investment Based on: | | | | | Year1 | Summary Compensation Table Total for Mr. Visentin PEO2 | Compensation Actually Paid to Mr. Visentin PEO3 | Summary Compensation Table Total for Mr. Bandrowczak PEO2 | Compensation Actually Paid to Mr. Bandrowczak PEO3 | Average Summary Compensation Table Total for Non-PEO NEOs2 | Average Compensation Actually Paid to Other NEOs3 | Total Shareholder Return 4 | Peer Group Total Shareholder Return 5 | GAAP Net (Loss) Income (millions) | Adj. 6 EBITDA (millions) | | 2024 | $— | $— | $14,320,642 | $(376,188) | $6,605,625 | $1,328,006 | $31.22 | $151.00 | $(1,321) | $503 | | 2023 | $— | $— | $12,844,686 | $14,069,073 | $5,251,711 | $4,795,117 | $62.22 | $152.23 | $1 | $596 | | 2022 | $11,192,336 | $5,216,828 | $8,561,267 | $4,746,408 | $2,981,034 | $1,785,941 | $46.50 | $125.86 | $(322) | $505 | | 2021 | $12,418,877 | $5,930,335 | $— | $— | $3,143,217 | $1,922,379 | $67.70 | $162.12 | $(455) | $647 | | 2020 | $18,144,360 | $(1,775,843) | $— | $— | $3,499,776 | $(2,064,931) | $66.39 | $127.81 | $192 | $777 |
Pay Versus Performance Table
________ (1) Steven J. Bandrowczak succeeded John Visentin as PEO in 2022 (on June 6, 2022 as interim CEO and on August 2, 2022 as CEO). John Visentin served as the PEO for the entirety of 2021 and 2020. Our Non-PEO NEOs for the applicable years were as follows: •2024: John Bruno, Jacques-Edouard Gueden, Xavier Heiss, and Louis J. Pastor •2023: John Bruno, Xavier Heiss, Joanne Collins Smee, Suzan Morno-Wade, and Louis J. Pastor •2022: John Bruno, Xavier Heiss, Louis J. Pastor, and Joanne Collins Smee •2021: Steven J. Bandrowczak, Xavier Heiss, Michael Feldman, and Louis J. Pastor •2020: Steven J. Bandrowczak, William Osbourn, Jr., Xavier Heiss, Michael Feldman, Hervé Tessler, and Louis J. Pastor (2) Amounts reported in these columns represent (i) the total compensation reported in the Summary Compensation Table (SCT) for the applicable year in the case of our PEO, Mr. Bandrowczak, and (ii) the average of the total compensation reported in the SCT for the applicable year for our Non-PEO NEOs reported for the applicable year. (3) Amounts reported in these columns represent CAP; adjustments were made to the amounts reported in the SCT for the applicable year. A reconciliation of the adjustments for our PEO, Mr. Bandrowczak, and for the average of the Non-PEO NEOs is set forth in the Reconciliation of SCT to CAP Table below, which describes the adjustments, each of which is prescribed by the SEC rules, to calculate the CAP Amounts from SCT amounts. (4) Total Shareholder Return (TSR) is cumulative for the measurement periods beginning on December 31, 2019 and ending on December 31, 2024, 2023, 2022, 2021 and 2020, respectively, calculated in accordance with Item 201(e) of Regulation S-K. (5) The amounts in this column assume the investment of $100 on December 31, 2019 in the S&P 600 Information Technology Index, which is used by the Company for purposes of compliance with Item 201(e) of Regulation S-K. The peer group index used was updated from the S&P 600 IT Services Industry Index used in the prior year Proxy, filed April 11, 2024. In comparison, the value of $100 invested in the S&P 600 IT Services Industry Index would be the following: 2024: $93.33; 2023: $100.09; 2022: $118.35; 2021: $169.20; 2020: $112.48. (6) Adjusted(1) EBITDA is the company-selected MIP measure. Refer to the “Non-GAAP Financial Measures” section for a reconciliation of the non-GAAP financial measure or an explanation of the performance measure.
Directors and Officers Liability Insurance and Indemnity
Directors and Officers Liability Insurance and Indemnity The policies are issued by Zurich American Insurance Company, Endurance Assurance Corp., Continental Casualty Company, National Union Fire Insurance Company, Old Republic Insurance Company, Westfield Specialty Insurance Company, Wesco Insurance Company, Berkshire Hathaway Specialty Insurance, National Casualty Company Westchester Fire Ins Co., and RSUI Indemnity Insurance Co. The policies expire on January 1, 2026 and the total annual premium is approximately $1.5 million.