Adjusted EPS is calculated as set forth in Annex A. This financial measure adjusts for specified items that can be highly variable or difficult to contribute up to 75%predict, as well as certain effects of their base salaryacquisitions and 100%dispositions that may not necessarily be indicative of their annual bonus to a supplemental retirement account. In addition, the Company has the ability to make annual contributions to the DCP. Each DCP contribution the Company makes on behalfoperational performance. A reconciliation of our NEOs is subject to a three-year vesting schedule, such that one-third of each contribution vests annually and each contribution is fully vested three years after the contribution is made. In addition, Company contributions become fully vested upon: (i) death, disability or a change of control; (ii) retirement after the attainment of certain age and/or service milestones; or (iii) as otherwise provided by the Committee in its sole discretion. The DCP Company contributions grantednon-GAAP adjusted EPS to our NEOsGAAP EPS is provided in November 2020 (fiscal 2021) and November 2019 (fiscal 2020) are set forth below: | Stephen P. MacMillan | | | 500,000 | | | 285,000 | | | Karleen M. Oberton | | | 325,000 | | | 260,000 | | | John M. Griffin | | | 300,000 | | | 175,000 | | | Kevin R. Thornal | | | 250,000 | | | 135,000 | | | Peter J. Valenti, III | | | — | | | 335,000 | |
The overall funding of the Company’s contributionsAnnex A to the DCP is based on the applicable STIP funding factor, with the amount of the Company DCP contribution to each individual based upon role/job level target values with differentiation for individual performance. Each of our NEOs, other than Mr. Valenti, received increased DCP contributions for fiscal 2021 based on the Company’s outstanding performance during fiscal 2020 and the COVID-19 pandemic, and each NEO’s efforts in furtherance of the Company’s success. Mr. Valenti did not receive a DCP contribution in November 2020 for fiscal 2021 due to his planned retirement.
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TABLE OF CONTENTS HOLOGIC, INC. 2023 Proxy Statement
How We Establish Adjusted Revenue and Adjusted EPS Goals
Deferred Equity Plan
The Hologic, Inc. Deferred Equity Plan, as amended (the DEP) is designed to allow executivesIn setting the adjusted revenue and non-employee directors to accumulate Hologic stock in a tax-efficient manner and assist them in meeting their long-term equity accumulationadjusted EPS goals and stock ownership guidelines. Participants may elect to defer the settlement of RSUs and PSUs granted under the Amended and Restated 2008 Equity Incentive Plan until separation from service or separation from service plus a fixed number of years. Participants may defer settlement by vesting tranche. Although the equity will vest on schedule, if deferral of settlement is elected, no shares will be issued until the settlement date. The settlement date will be the earlier of death, disability, change in control or separation from service/separation from service plus number of years elected.
Retirement Benefits
The Committee maintains retirement benefits to help the Company attract and retain the most highly talented senior executives. Over the years,for our 2022 STIP, the Committee has modified these programs to ensure competitive alignment with an evolving market. We believe the overall value of our retirement program is consistent with our industry peers.
401(k) Savings and Investment Plan
The Company sponsors a 401(k) Savings and Investment Plan, which is a qualified retirement plan offered to all eligible employees, including our NEOs. The Plan allows participants to elect to defer a portion of their compensation on a pre-tax basis, up to the limits imposed by the Internal Revenue Code of 1986, as amended. In 2020, which includes the first three months ofconsidered the Company’s fiscal 2021, the Company matched 100% of the first 3% and 50% of the next 2% of each participant’s deferrals, up to an amount equal to 4% of the first $285,000 earned by a participant.
Equity Retirement Provision
After considering market trends in retirement program practiceshistorical performance as well as the needsmarket climate and internal budgeting and forecasting. For the 2022 STIP, adjusted revenue at target represents approximately 29.4% decrease over the prior year adjusted revenue, while adjusted revenue at maximum represents approximately 8.6% growth over prior year adjusted revenue. Adjusted EPS at target represents approximately a 58.6% decrease compared to the prior year adjusted EPS, while adjusted EPS at maximum represents approximately a 5.3% decrease compared to the prior year adjusted EPS. While fiscal year 2022 targets for adjusted revenue and adjusted EPS were lower in absolute terms compared to fiscal year 2021 results, this was due to an unprecedented year-over-year comparison, with fiscal year 2021 impacted by exceptional SARS-CoV-2-driven test revenue. The Compensation Committee determined that the adjusted revenue and adjusted EPS targets for fiscal year 2022 were appropriate in light of the Company, during fiscal 2016, the Committee approved the addition of a retirement provision to its equity compensation program. The provision, which applies solely to U.S. employees, provides for the continued vesting of RSUs and stock options and pro-rata vesting of PSUs when a person retires, if the individual is either 65 years of age or older, or at least 55 years of age with 10 years of continuous service with the Company. While RSUs and stock options continue to vest on their original vesting schedule following retirement, PSUs vest on their original vesting date on a pro-rata basis (based on number of days employed during the applicable performance period) based on actual performance during the performance period (assuming threshold performance is achieved). If threshold performance is not achieved during the applicable performance period, no PSUs will vest. This equity retirement provision is applicable to equity grants made from November 5, 2015 forward; however, beginning with the PSUs granted in fiscal 2021, upon an executive’s retirement, PSUs vest on their original vesting date without application of any pro-ration.
Other Benefits and Perquisites
Our NEOs also generally participate in other benefit plans on the same terms as all of our other employees. These plans include our employee stock purchase plan, medical and dental insurance, life insurance, short- and long-term disability insurance programs,these factors as well as customary vacation, leavemacroeconomic factors, Company financial projections and the consensus view of absenceinvestment analysts covering the Company. As shown in the chart above, the maximum adjusted revenue represents over 50% performance above the target, while the maximum adjusted EPS represents over 128% performance above target, showing the exceptional results needed to achieve maximum funding (which was not achieved). Threshold adjusted revenue and adjusted EPS are generally set in line with prior year adjusted results, but we also factor in unpredictability regarding the future demand for SARS-CoV-2 tests and the continuing strong demand for SARS-CoV-2 tests to create challenging targets, with maximum funding only occurring through exceptional results.
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2022 STIP Awards For fiscal 2022, the Company’s adjusted revenue performance was 146% of target and adjusted EPS was 157% of target. With adjusted revenue weighted 60% and adjusted EPS weighted 40%, these performance results yield a payout at 150% of target. Individual bonus awards for NEOs were then calculated based on this overall funding level as well as the targeted payout levels and individual performance objectives for each NEO, as discussed in more detail below. Individual performance objectives reflected the top priorities for our NEOs and were aligned with the top risks identified in our annual enterprise risk management process, including driving global growth, strengthening the pipeline for 2023 and beyond and succession planning and talent development. Messrs. Thornal’s and Verstreken’s individual performance objectives also included revenue growth performance for their respective divisions. MR. MACMILLAN | | | Fiscal 2022 STIP Awards
Based on the Company’s financial performance as well as an assessment of Mr. MacMillan’s individual performance for fiscal 2022, Mr. MacMillan was awarded a total bonus amount of $2,544,687, which represents 150% of his overall target amount. | | | |
Performance Objectives and Outcomes Mr. MacMillan’s individual performance objectives were designed to reward the achievement of the following goals: Driving global growth and recovery by accelerating base business recovery, scaling up the supply chain and optimizing the global operating model. | | | • Continued exceptional leadership through uncertain times, with base businesses emerging poised for growth. | | • Drove very strong financial results in fiscal 2022, which exceeded goals. | | • Leveraged strength of business to focus on our role to globally help more women. | Strengthening the product pipeline for 2023 and beyond by accelerating acquisitions, executing successful integrations and identifying a pipeline of product launches. | | | • Bolstered placement of Panther molecular diagnostic instruments worldwide, seeing strong core-STI assays and newer assay use and strengthened and expanded the International business. | | • Continued focus on executing integration plans to drive growth and broaden the Company’s product portfolio and offerings. | Focusing on succession planning and talent development by continuing to develop potential successors for key leadership positions. | | | • Continued emphasis on leadership development of potential successors and key management roles, and building an inclusive ethos which values diversity. |
TABLE OF CONTENTS HOLOGIC, INC. 2023 Proxy Statement
MS. OBERTON | | | Fiscal 2022 STIP Awards
Based on the Company’s financial performance as well as an assessment of Ms. Oberton’s individual performance for fiscal 2022, Ms. Oberton was awarded a total bonus amount of $675,000, which represents 150% of her overall target amount. | | | |
Performance Objectives and Outcomes Ms. Oberton’s individual performance objectives were designed to reward the achievement of the following goals: Driving global growth and accelerating recovery by providing strategic partnership to support scale up of supply chain, global services and network optimization, as well as optimizing corporate solutions. | | | • Drove capital allocation strategy with continued acquisitions and share repurchases while maintaining a net leverage ratio under 1x. | | • Partnered with supply chain and business to define a plan for multi-year network optimization. | | • Delivered on fiscal 2022 global service initiatives measurement objectives. | Strengthening the product pipeline for 2023 and beyond by providing strategic partnership, insights and solutions for pipeline development and driving rigor in understanding of key assumptions with deal models and delivering financial support in realization. | | | • Supported robust research and development investments to drive organic revenue growth. | | • Delivered financial support to help realize cost synergies assumed in deal models and drive for upside.
| Focusing on succession planning and talent development by increasing organizational talent and capabilities in Finance and Information Services and identifying and developing potential successors for key financial leadership positions. | | | • Continued to develop internal candidates for key roles. | | • Increased talent pipeline as measured by increase in number of potential successors for critical positions.
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TABLE OF CONTENTS HOLOGIC, INC. 2023 Proxy Statement
MR. GRIFFIN | | | Fiscal 2022 STIP Awards
Based on the Company’s financial performance as well as an assessment of Mr. Griffin’s individual performance for fiscal 2022, Mr. Griffin was awarded a total bonus amount of $630,000, which represents 150% of his overall target amount. | | | |
Performance Objectives and Outcomes Mr. Griffin’s individual performance objectives were designed to reward the achievement of the following goals: Driving global growth by aligning and allocating legal resources to support growth across all regions and franchises. | | | • The legal, business development and integration teams focused on the most important priorities to accelerate revenue growth. | | • Partnered with supply chain and divisional leaders to manage operations through uncertain/evolving times. | Strengthening the product pipeline for 2023 and beyond by executing multiple acquisitions in partnership with divisions and regions and providing legal support for business development transactions and pipeline development. | | | • Executed on identified transactions and continued to expand business development pipeline. | | • Continued executing integration plans in Integration Management Office partnering with divisions/regions. | | • Aligned intellectual property and other similar policies.legal resources with critical pipeline programs. | Focusing on succession planning and talent development by developing potential successors, updating and assessing succession plans for direct reports and retaining key talent. | | | • Provided key experiences and refined development plans for potential successors. | | • Refined development plans for all attorneys and professionals. | | • Hired and integrated for open roles, including a key commercial role. |
We also provide limited perquisitesTABLE OF CONTENTS HOLOGIC, INC. 2023 Proxy Statement
MR. THORNAL | | | Fiscal 2022 STIP Awards
Based on the Company’s financial performance as well as an assessment of Mr. Thornal’s individual performance for fiscal 2022, Mr. Thornal was awarded a total bonus amount of $646,875, which represents 150% of his overall target amount. | | | |
Performance Objectives and Outcomes Mr. Thornal’s individual performance objectives were designed to reward the achievement of the following goals: Driving global growth by solidifying Hologic’s role in SARS-CoV-2 testing, accelerating the growth of the base Diagnostics Division and personal benefits baseddelivering on considerations uniqueacquisition deal models and integration. | | | • Exceeded growth targets with strong placement of our Panther instruments. | | • Strong progress on the integration of acquisitions, including Biotheranostics and its lab expansion to each NEO position. Duringdrive further growth. | | • Partnered to grow international Diagnostics’ revenue. | Strengthening the pipeline for 2023 and beyond by completing launch of in-process research and development and rebuilding acquisition target list in strategic priority areas. | | | • Launched COVID/Flu Multiplex, and in process for additional assay launches. | | • Facilitated organic product pipeline development.
| Focusing on succession planning and talent development by providing key experiences and coaching for potential successors and identifying and growing near- and long-term succession candidates in key positions. | | | • Progressed on the development of potential successors and other key leadership roles. | | • Filled open positions with speed.
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TABLE OF CONTENTS HOLOGIC, INC. 2023 Proxy Statement
MR. VERSTREKEN | | | Fiscal 2022 STIP Awards
Based on the Company’s financial performance as well as an assessment of Mr. Verstreken’s individual performance for fiscal 2020, we provided2022, Mr. Verstreken was awarded a total bonus amount of $602,473, which represents 150% of his overall target amount. | | | |
Performance Objectives and Outcomes Mr. Verstreken’s individual performance objectives were designed to reward the achievement of the following goals: Driving global growth by maximizing Hologic’s role in SARS-CoV-2 testing, accelerating the growth of the International base Diagnostics Division and delivering on acquisition deal models and integration. | | | • Exceeded growth targets with focus on base business. | | • Focused on integration of acquisition deal model value drivers. | | • Drove growth with strong placement of our Panther instruments internationally. | Strengthening the pipeline for 2023 and beyond by executing on new product launches and developing new partnership with divisional strategy. | | | • Delivered on new planned direct sales model relationships in key international markets. | | • Executed on new product launches and associated sales goals. | | • Partnered with Divisional strategy teams to facilitate organic and inorganic opportunities. | Focusing on succession planning and talent development by identifying and growing near- and longer-term succession candidates for key leadership roles and providing coaching and experiences for key employees. | | | • Progressed on the development of potential successors and other key leadership roles. | | • Filled open positions with speed.
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TABLE OF CONTENTS HOLOGIC, INC. 2023 Proxy Statement
LONG-TERM EQUITY INCENTIVES We believe long-term equity incentive compensation encourages NEOs to seek sustainable growth and value creation. We also use our long-term awards to attract and retain critical employee talent by providing a competitive market-based opportunity. To achieve these objectives, we award long-term incentives on an annual basis in the form of equity. For fiscal 2022, we structured our annual equity incentive awards as follows: Performance Stock Units - ROIC PSUs One-third of the PSUs granted use ROIC as a metric and vest only if the Company achieves a pre-determined ROIC three-year average minimum threshold at the end of a three-year performance period (the ROIC PSUs). If the minimum ROIC threshold is not achieved, none of the ROIC PSUs granted for that performance period will vest and all will be forfeited. If the target ROIC goal is achieved, 100% of the ROIC PSUs granted will vest. The maximum payout for ROIC PSUs is limited to 200% of the target number of ROIC PSUs granted and is earned only if we achieve the maximum ROIC goal. At the vesting date, earned ROIC PSU awards are settled in shares of our common stock, unless settlement has been deferred pursuant to the Company’s Deferred Equity Plan. For details about our use of ROIC as a performance measure, please see “Why ROIC, Relative TSR and Adjusted FCF?” below. ROIC PSUs also are subject to the terms and conditions set forth in the form of ROIC Performance Stock Unit Award Agreement. The following table outlines the threshold, minimum, target, 150% and maximum ROIC goals for the ROIC PSUs granted as fiscal 2022 long-term incentive awards (see “2022 Long-Term Annual Incentive Award Grants” below): (1)
| Calculated at the end of the three-year performance period. |
(2)
| Expressed as a percentage of target PSUs granted. |
Vesting of ROIC PSUs Granted in Fiscal 2019 The ROIC PSU awards granted in November 2018 (fiscal 2019) vested in November 2021 (fiscal 2022). These ROIC PSUs were subject to a three-year cliff vesting period with vesting contingent on the Company achieving an average ROIC of 12% for the three-year performance period. If ROIC for the performance period was below 12%, none of the PSUs would vest. Target ROIC was 13% and maximum ROIC was 15%. Actual ROIC performance was 21.35% for the three-year performance period. Accordingly, these PSUs vested at 200% of target. TABLE OF CONTENTS HOLOGIC, INC. 2023 Proxy Statement
Vesting of ROIC PSUs Granted in Fiscal 2020 The ROIC PSU awards granted in November 2019 (fiscal 2020) vested in November 2022 (fiscal 2023). These ROIC PSUs were subject to a three-year cliff vesting period with vesting contingent on the Company achieving an average ROIC of 11% for the three-year performance period. If ROIC for the performance period was below 11%, none of the PSUs would vest. Target ROIC was 13% and maximum ROIC was 15%. Actual ROIC performance was 24.45% for the three-year performance period. Accordingly, these PSUs vested at 200% of target. Earning of ROIC PSUs Granted in Fiscal 2021 The ROIC PSU awards granted in November 2020 (fiscal 2021) became earned in November 2021 (fiscal 2022). These ROIC PSUs are subject to three-year service-based cliff vesting, with performance-based vesting contingent on the Company achieving an ROIC of 10% for the one-year performance period. If ROIC for the performance period was below 10%, none of the PSUs would vest. Target ROIC was 13% and maximum ROIC was 26%. Actual ROIC performance was 32.58% for the fiscal 2021 performance period. Accordingly, these PSUs became earned at 200% of target, subject to an additional two years of service-based vesting requirements. Performance Stock Units – TSR PSUs An additional one-third of the PSUs vest based on the Company’s total stockholder return as compared to the total stockholder return of companies in the TSR PSU Peer Group, measured over a three-year performance period (the TSR PSUs). The TSR PSU awards vest at target and at 200% of target upon achievement of relative total stockholder return at the 50th and 95th percentile, respectively. If the Company’s relative total stockholder return is below the 25th percentile, then no TSR PSUs will vest. At the vesting date, earned PSU awards are settled in shares of common stock, unless settlement has been deferred pursuant to the Company’s Deferred Equity Plan. For details about our use of relative TSR as a performance measure, please see “Why ROIC, Relative TSR and Adjusted FCF?” below. TSR PSUs also are subject to the terms and conditions set forth in the form of TSR Performance Stock Unit Award Agreement. Vesting of TSR PSUs Granted in Fiscal 2019 The PSU awards granted in November 2018 (fiscal 2019) vested in November 2021 (fiscal 2022). These TSR PSUs were subject to a three-year cliff vesting period with vesting contingent on the Company achieving a relative total stockholder return at the 25th percentile or above. If relative total stockholder return for the performance period was below the 25th percentile, none of the PSUs would vest. Hologic’s total stockholder return for the three-year performance period was 97.06%, which put Hologic in the 62nd percentile of the TSR PSU peer group. Accordingly, these PSUs vested at 123% of target. Vesting of TSR PSUs Granted in Fiscal 2020 The PSU awards granted in November 2019 (fiscal 2020) vested in November 2022 (fiscal 2023). These TSR PSUs were subject to a three-year cliff vesting period with vesting contingent on the Company achieving a relative total stockholder return at the 25th percentile or above. If relative total stockholder return for the performance period was below the 25th percentile, none of the PSUs would vest. Hologic’s total stockholder return for the three-year performance period was 38.27%, which put Hologic in the 68th percentile of the TSR PSU peer group. Accordingly, these PSUs vested at 136% of target. Performance Stock Units – FCF PSUs The final one-third of the PSUs vest based on the Company’s adjusted FCF measured over a three-year performance period (the FCF PSUs). The FCF PSUs become earned based on the Company’s cumulative adjusted FCF performance, with FCF of $3,900M resulting in earnings of 150% of target. If the Company’s adjusted FCF performance is less than $2,000M, then no FCF PSUs will become earned. At the vesting date, the earned FCF PSU awards are settled in shares of common stock, unless settlement has been deferred pursuant to the Company’s Deferred Equity Plan. For details about our use of adjusted FCF as a performance measure, please see “Why ROIC, Relative TSR and Adjusted FCF?” below. FCF PSUs also are subject to the terms and conditions set forth in the form of FCF Performance Stock Unit Award Agreement. TABLE OF CONTENTS HOLOGIC, INC. 2023 Proxy Statement
The following table outlines the threshold, minimum, target, 150% and maximum FCF goals for the FCF PSUs granted as fiscal 2022 long-term incentive awards (see “2022 Long-Term Annual Incentive Award Grants” below): (1)
| Calculated at the end of the three-year performance period. |
(2)
| Expressed as a percentage of target PSUs granted. |
Vesting of FCF PSUs Granted in Fiscal 2020 The PSU awards granted in November 2019 (fiscal 2020) that became earned in November 2020 (fiscal 2021) vested in November 2022 (fiscal 2023). These FCF PSUs were subject to three-year service-based cliff vesting, with performance-based vesting contingent on the Company achieving adjusted FCF of $525 million. If adjusted FCF for the performance period was below $525 million, none of the PSUs would vest. Target adjusted FCF was $700 million. Actual adjusted FCF performance was $829.7 million for the fiscal 2020 performance period. Accordingly, these PSUs became earned and subsequently vested at 174% of target. Earning of FCF PSUs Granted in Fiscal 2021 The PSU awards granted in November 2020 (fiscal 2021) became earned in November 2021 (fiscal 2022). These FCF PSUs are subject to three-year service-based cliff vesting, with performance-based vesting contingent on the Company achieving adjusted FCF of $800 million. If adjusted FCF for the performance period was below $800 million, none of the PSUs would vest. Target adjusted FCF was $1,100 million and maximum adjusted FCF was $1,800 million. Actual adjusted FCF performance was $2,251 million for the fiscal 2021 performance period. Accordingly, these PSUs became earned at 200% of target, subject to an additional two years of service-based vesting requirements. TABLE OF CONTENTS HOLOGIC, INC. 2023 Proxy Statement
Summary of Performance of Fiscal 2019 and Fiscal 2020 PSUs As reflected above, the overall performance of the Fiscal 2019 PSUs was 161.5% and Fiscal 2020 PSUs was 170%. The increase reflects the Company’s overall performance during the respective periods consistent with the Board’s philosophy to pay for performance. Why ROIC, Relative TSR and Adjusted FCF? | ROIC. The Committee introduced ROIC as a performance metric in fiscal 2014 to hold management accountable for generating greater returns on capital allocated. Investors have been supportive of the use of ROIC. Given the significant improvement in ROIC since its introduction as a performance metric, the Committee believes it is having the intended effect. | In addition to being well-received and supported by our stockholders, the use of ROIC: | ✔ | | | Creates an effective balance in our program of growth (our STIP focuses on adjusted revenue and adjusted EPS) and returns (our long-term incentives focus on ROIC) | ✔ | | | Holds management accountable for the efficient use of capital | ✔ | | | Links executive compensation to value creation | The key building blocks of our ROIC metric are: (1) adjusted net operating profit after tax (NOPAT), (2) average net debt, and (3) average stockholders’ equity. ROIC is calculated as NOPAT/(average net debt + average stockholders’ equity).(1) ROIC is a non-GAAP measure. See Annex A for a reconciliation of non-GAAP measures. | RELATIVE TSR. The Committee introduced relative TSR as a performance metric in fiscal 2017. In addition to being well-received and supported by our stockholders, use of relative TSR: | ✔ | | | Provides an external relative performance measure, which complements the internal absolute ROIC measure | ✔ | | | Links executive compensation directly to stockholder value creation | To calculate the Company’s relative TSR performance, the cumulative three-year TSR for Hologic and each of the NEOs with an automobile allowance.companies in the TSR Peer Group is calculated and then Hologic’s discrete percentile rank is calculated. The TSR PSUs vest at target and at 200% of target upon achievement of relative TSR at the 50th and 95th percentile, respectively. If the Company’s relative TSR is below the 25th percentile, no TSR PSUs will vest and all will be forfeited. | ADJUSTED FCF. The Committee introduced adjusted FCF as a performance metric in fiscal 2020 to measure the Company’s financial discipline. In addition Mr. MacMillan has access to private air transportation for business purposesbeing well-received and limited personal use. The personalsupported by our stockholders, the use of adjusted FCF: | ✔ | | | Promotes profitable growth with strong capital discipline | ✔ | | | Measures ability to generate cash to fund capital initiatives such as making acquisitions, repurchasing shares, expanding operations or paying down debt | Adjusted FCF is subjectcalculated by subtracting capital expenditures from our adjusted operating cash flow. A reconciliation of our net cash provided by operating activities to our non-GAAP adjusted FCF is provided in Annex A to this proxy statement. |
(1)
| NOPAT is calculated in a maximum aggregate incremental costmanner similar to the calculation of adjusted net income, as used for the calculation of adjusted EPS under our STIP as described in Annex A, except the impact to operating results from acquisitions and dispositions are not excluded, and non-operating income and expenses are excluded, such as interest expense, etc. The NOPAT amounts are intended to match the amounts included in our publicly released Non-GAAP results. Average stockholders’ equity is the average of the beginning of the period and the end of the period stockholders’ equity; provided, however, that average stockholders’ equity is adjusted to exclude any charges for impairment of goodwill and intangible assets that occur after September 28, 2013. Average net debt is the average of the beginning of the period and the end of the period net debt which is the total book value of all debt outstanding less cash and cash equivalents. |
TABLE OF CONTENTS HOLOGIC, INC. 2023 Proxy Statement
How We Establish ROIC, Relative TSR and Adjusted FCF Goals
ROIC. In setting ROIC goals for the ROIC PSUs, the Committee considered past performance as well as future opportunities for efficiencies. Considering the Company’s past and anticipated financial performance as well as its current strategy to accelerate business development activities, for the fiscal 2022 ROIC PSU grants, the Committee determined to keep the 2022 ROIC minimum threshold at 10%, keep the target at 13% and decrease the maximum to 16%. | RELATIVE TSR. In implementing and setting the relative TSR goals for the TSR PSUs, the Committee considered market practice as well as the Company’s focus on driving stockholder value. The TSR PSUs granted as fiscal 2022 long-term incentive awards vest at target upon achievement of relative TSR at the 50th percentile of a custom TSR Peer Group. If the Company’s relative TSR is below the 25th percentile, then no TSR PSUs will vest, and all will be forfeited. The Company considered utilizing the 75th percentile of $150,000 perTSR as the threshold for the maximum 200% payout, as many companies do, but determined to use the more challenging 95th percentile as the threshold for maximum payout. The Company also utilizes a payout cap at 100% for negative TSR performance that otherwise warrants above-target funding. | ADJUSTED FCF. In setting adjusted FCF goals for the initial grant of FCF PSUs, the Committee considered the Company’s budgeted and actual adjusted FCF performance over the past three years. Considering the Company’s past and anticipated performance, for fiscal year.2022 FCF PSU grants, the Committee established a three-year cumulative adjusted FCF target of $2,800 million, with a threshold of $2,000 million and maximum of $5,000 million. |
Stock Options Stock options vest in four equal annual installments, becoming fully vested on the fourth anniversary of the grant date. Stock options have a 10-year term and are subject to the terms and conditions set forth in the form of Stock Option Award Agreement. The Committee believes stock options are inherently performance-based because the exercise price is equal to the market value of the underlying stock on the date the option is granted, and therefore the stock option has value to the holder only if the market value of the common stock of the Company appreciates over time. Thus, stock options are intended to provide equity compensation to our employees, including our NEOs, while simultaneously creating value for our stockholders. Restricted Stock Units RSUs vest in three equal annual installments, becoming fully vested on the third anniversary of the grant date. Only vested RSUs can be exchanged for shares of Hologic common stock. RSUs also are subject to the terms and conditions set forth in the form of Restricted Stock Unit Award Agreement. The Committee grants RSUs to reflect competitive practices and to promote retention by providing a level of value to recipients based on the price of our common stock at any point in time. In addition to their strong retention value, we believe that RSUs support an ownership mentality, encouraging our employees, including our NEOs, to act in a manner consistent with the long-term interests of the Company and our stockholders. 2022 Long-Term Annual Incentive Award Grants The annual long-term incentive awards granted to our NEOs in November of 2021 (fiscal 2022) as compared to awards for fiscal 2021 are as follows: Stephen P. MacMillan | | | 10,000,000 | | | 9,896,996 | | | 1.0% | Karleen M. Oberton | | | 2,000,000 | | | 1,900,000 | | | 5.3% | John M. Griffin | | | 1,750,000 | | | 1,700,000 | | | 2.9% | Kevin R. Thornal | | | 1,750,000 | | | 1,400,000 | | | 25.0% | Jan Verstreken | | | 1,500,000 | | | 1,000,000 | | | 50.0% |
(1)
| The award values in this table differ slightly from the grant date fair values of all perquisites and other personal benefits provided to our NEOs are includedthe awards reported in the “All Other Compensation” column of the Summary Compensation Table on page 66.Our Decision-Making Processand the Grants of Plan-Based Awards Table. The Compensationaward values in this table are the values awarded by the Committee overseeswhile the compensation and benefits programs for our NEOs. The Committee is comprised solelygrant date fair value of independent, non-employee members of the Board of Directors. The Committee works very closely with its independent compensation consultant and management to ensure that our Company’s executive compensation program is appropriately aligned with our business strategy and is achieving the desired objectives. Details of the Committee’s authority and responsibilities are specifiedeach award reported in the Committee’s charter, which may be accessed through investors.hologic.com. 60
| | | Summary Compensation Table and the Grants of Plan-Based Awards Table is the award value for accounting purposes. |
TABLE OF CONTENTS HOLOGIC, INC. 2023 Proxy Statement
The Committee increased Mr. MacMillan’s grant for fiscal 2022 in light of his continued strong leadership through the COVID-19 pandemic and driving the strengthening of the Company’s base businesses. The increase in value of Ms. Oberton’s fiscal 2022 long-term incentive award grant as compared to her fiscal 2021 award was due to her strong performance and leadership, including driving a capital allocation strategy that supports acquisitions and share repurchases while maintaining a net leverage ratio under 1.0x. For Mr. Griffin, the increase was based on his strong leadership, execution on business development strategies and focus on priorities to accelerate revenue growth across the Company. Mr. Thornal’s grant increased in recognition of his leadership during the COVID-19 pandemic, which led to exceeding growth targets and accelerating Panther placements. The increase for Mr. Verstreken’s grant recognized his partnership across the Divisions to drive growth, acquisition integration and Panther placements. 2023 Long-Term Annual Incentive Award Grants For the annual long-term incentive awards granted to our NEOs in November of 2022 (fiscal 2023), the grants increased by approximately 10% for Mr. MacMillan, 12.5% for Ms. Oberton, 2.9% for Mr. Griffin, 14% for Mr. Thornal and 33% for Mr. Verstreken. These grants align with performance as well as acknowledge the competitive position of the individual’s total direct compensation for the year. DEFERRED COMPENSATION Deferred Compensation Program Contributions The Company’s Non-Qualified Deferred Compensation Plan (the DCP) provides our NEOs with non-qualified retirement benefits in excess of what may be provided under our 401(k) Savings and Investment Plan and tax code limitations. The Committee considers the DCP Company contribution in the context of total compensation and views the contribution both as a tool to help close a competitive market gap when evaluating the total value of annual compensation and as a retention mechanism. Mr. Verstreken is not eligible to participate in the DCP because he is located outside of the United States. The DCP allows US-based NEOs to contribute up to 75% of their base salary and 100% of their annual bonus to a supplemental retirement account. In addition, the Company has the ability to make annual contributions to the DCP. Each DCP contribution the Company makes on behalf of our NEOs is subject to a three-year vesting schedule, such that one-third of each contribution vests annually and each contribution is fully vested three years after the contribution is made. In addition, Company contributions become fully vested upon: (i) death, disability or a change of control; (ii) retirement after the attainment of certain age and/or service milestones; or (iii) as otherwise provided by the Committee in its sole discretion. The DCP Company contributions granted to our NEOs in November 2022 (fiscal 2023) and November 2021 (fiscal 2022) are set forth below: Stephen P. MacMillan | | | 375,000 | | | 432,500 | Karleen M. Oberton | | | 210,000 | | | 267,000 | John M. Griffin | | | 210,000 | | | 267,000 | Kevin R. Thornal | | | 172,500 | | | 225,000 | Jan Verstreken | | | — | | | — |
The overall funding of the Company’s contributions to the DCP is based on the applicable STIP funding factor, with the amount of the Company DCP contribution to each individual based upon role/job level target values with differentiation for individual performance. Each of our NEOs who participate in the DCP received slightly decreased DCP contributions for fiscal 2023 based on the lower STIP funding factor for fiscal 2022 compared to fiscal 2021. Deferred Equity Plan The Hologic, Inc. Deferred Equity Plan, as amended (the DEP) is designed to allow US-based executives and non-employee directors to accumulate Hologic stock in a tax-efficient manner and assist them in meeting their long-term equity accumulation goals and stock ownership guidelines. Participants may elect to defer the settlement of RSUs and PSUs granted under the Amended and Restated 2008 Equity Incentive Plan until separation from service or separation from TABLE OF CONTENTS HOLOGIC, INC. 2023 Proxy Statement
The Role of the Committee
The Committee seeks to ensure that the links between our executive compensation program and our business goals are responsible, appropriate and strongly aligned with stockholder interests. The Committee annually determines the compensation levels of our NEOs by considering several factors, including:
Each NEO’s role and responsibilities
How the NEO is performing those responsibilities
Our historical and anticipated future financial performance
Compensation practices of the companies in our peer group(s)
Survey data from a broader group of comparable public companies (where appropriate)
The Role of Management
During fiscal 2020, Mr. MacMillan reviewed the performance and compensation of the NEOs, other than himself, and made recommendations as to their compensation to the Committee. No executive officer participates in the deliberations of the Committee regarding his or her own compensation.
The Role of the Independent Compensation Consultant
The Committee retained Pearl Meyer & Partners, LLC (Pearl Meyer) to serve as its executive compensation consultant for fiscal 2020. Pearl Meyer did not perform any services for us other than as directed by the Committee.
During fiscal 2020, Pearl Meyer advised the Committee on a variety of subjects such as compensation plan design and trends, pay for performance analytics, benchmarking norms, and other such matters. Pearl Meyer also conducted a risk assessment of our executive compensation practices for fiscal 2020, as described in the “Risk” section on page 14. Pearl Meyer reports directly to the Committee, participates in meetings as requested and communicates with the Committee Chair between meetings as necessary.Prior to engaging Pearl Meyer, the Committee reviewed the firm’s qualifications as well as its independence and any potential conflicts of interest. The Committee has the sole authority to modify or approve Pearl Meyer’s compensation, determine the nature and scope of its services, evaluate its performance, and terminate the engagement and hire a replacement or additional consultant at any time.
Peer Group
The Committee compares our executive compensation program to a group of companies that are comparable in terms of size and industry (the Primary Peer Group). The overall purpose of this peer group is to provide a market frame of reference for evaluating our compensation arrangements (current or proposed), understanding compensation trends among comparable companies, and reviewing other compensation and governance-related topics that may arise during the course of the year.
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HOLOGIC, INC. 2021 Proxy Statement
service plus a fixed number of years. Participants may defer settlement by vesting tranche. Although the equity will vest on schedule, if deferral of settlement is elected, no shares will be issued until the settlement date. The settlement date will be the earlier of death, disability, change in control or separation from service/separation from service plus number of years elected. RETIREMENT BENEFITS The Committee maintains retirement benefits to help the Company attract and retain the most highly talented senior executives. Over the years, the Committee has modified these programs to ensure competitive alignment with an evolving market. We believe the overall value of our retirement program is consistent with our industry peers. 401(K) SAVINGS AND INVESTMENT PLAN The Company sponsors a 401(k) Savings and Investment Plan, which is a qualified retirement plan offered to all eligible employees, including our U.S. NEOs. The Plan allows participants to elect to defer a portion of their compensation on a pre-tax basis, up to the limits imposed by the Internal Revenue Code of 1986, as amended (the “Code”). In 2022, which includes the first three months of the Company’s fiscal 2023, the Company matched 100% of the first 3% and 50% of the next 2% of each participant’s deferrals, up to an amount equal to 4% of the first $305,000 earned by a participant. UK Group Pension Plan The Company operates a UK Group Personal Pension Plan for eligible employees, including our non-U.S. NEOs. The Plan is a defined contribution scheme with Company and employee contributions, subject to annual limits and pension regulations as amended from time to time. In 2022, which includes the first three months of the Company’s fiscal 2023, the Company contribution was 6% of base salary and the employee minimum contribution was 3%, deducted from pre-tax salary. In 2022, Mr. Verstreken did not participate in the plan. EQUITY RETIREMENT PROVISION Equity compensation awards held by U.S. employees provide for retirement vesting benefits if the retiree is either (i) 65 years of age or older or (ii) 55 years of age or older with 10 years of continuous service with the Company, so long as such awards have been outstanding for at least 90 days prior to such retirement. Outstanding RSUs and stock options continue to vest on their original vesting schedule following retirement. Outstanding PSUs vest on their original vesting date following the end of the performance period based on actual performance during the performance period (assuming at least threshold performance is achieved). If threshold performance is not achieved during the applicable performance period, no PSUs will vest. OTHER BENEFITS AND PERQUISITES Our NEOs also generally participate in other benefit plans on the same terms as all of our other employees. These plans include our employee stock purchase plan, medical and dental insurance, life insurance, short- and long-term disability insurance programs, as well as customary vacation, leave of absence and other similar policies. We also provide limited perquisites and personal benefits based on considerations unique to each NEO position. During fiscal 2022, we provided (i) each of the NEOs with an automobile allowance, (ii) housing allowance to Mr. Verstreken, as well as to other employees and (iii) where occasionally appropriate spousal or companion travel on business trips (with required approval). In addition, Mr. MacMillan has access to private air transportation for business purposes and limited personal use. The personal use is subject to a maximum aggregate incremental cost to the Company of $150,000 per fiscal year. From time to time, the Company also allows its employees, including NEOs, the personal use of tickets for sporting and cultural events previously acquired by the Company for business entertainment purposes or acquired in connection with corporate sponsorships. There is no incremental cost to the Company for the use of such tickets, and therefore, such items are not reflected in the compensation of our NEOs in the “Summary Compensation Table” below. The values of all perquisites and other personal benefits provided to our NEOs are included in the “All Other Compensation” column of the Summary Compensation Table on page 72. | | | For setting target compensation levels for NEOs in fiscal 2020, the Company examined the practices of the following 15 companies, which it adopted as our Primary Peer Group in March 2019 (as well as other relevant data):
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Our Decision-Making Process The Compensation Committee oversees the compensation and benefits programs for our NEOs. The Committee is comprised solely of independent, non-employee members of the Board of Directors. The Committee works very closely with its independent compensation consultant and management to ensure that our Company’s executive compensation program is appropriately aligned with our business strategy and is achieving the desired objectives. We also take into account feedback received from our stockholders. Details of the Committee’s authority and responsibilities are specified in the Committee’s charter, which may be accessed through investors.hologic.com. THE ROLE OF THE COMMITTEE The Committee seeks to ensure that the links between our executive compensation program and our business goals are responsible, appropriate and strongly aligned with stockholder interests. The Committee annually determines the compensation levels of our NEOs by considering several factors, including: Each NEO’s role and responsibilities How the NEO is performing those responsibilities Our historical and anticipated future financial performance Compensation practices of the companies in our peer groups(s) Survey data from a broader group of comparable public companies (where appropriate) THE ROLE OF MANAGEMENT During fiscal 2022, Mr. MacMillan reviewed the performance and compensation of the NEOs, other than himself, and made recommendations as to their compensation to the Committee. No executive officer participates in the deliberations of the Committee regarding his or her own compensation. THE ROLE OF THE INDEPENDENT COMPENSATION CONSULTANT The Committee retained Pearl Meyer & Partners, LLC (Pearl Meyer) to serve as its executive compensation consultant for fiscal 2022. Pearl Meyer did not perform any services for us other than as directed by the Committee. During fiscal 2022, Pearl Meyer advised the Committee on a variety of subjects such as compensation plan design and trends, pay for performance analytics, benchmarking norms, and other such related matters. Pearl Meyer also conducted a risk assessment of our executive compensation practices for fiscal 2022, as described in the “Risk” section on page 14. Pearl Meyer reports directly to the Committee, participates in meetings as requested and communicates with the Committee Chair between meetings as necessary. Prior to engaging Pearl Meyer, the Committee reviewed the firm’s qualifications as well as its independence and any potential conflicts of interest and determined there were none. The Committee has the sole authority to modify or approve Pearl Meyer’s compensation, determine the nature and scope of its services, evaluate its performance, and terminate the engagement and hire a replacement or additional consultant at any time. The Committee compares our executive compensation program to a group of companies that are comparable in terms of size and industry (the Primary Peer Group). The overall purpose of this peer group is to provide a market frame of reference for evaluating our compensation arrangements (current or proposed), understanding compensation trends among comparable companies, and reviewing other compensation and governance-related topics that may arise during the course of the year. TABLE OF CONTENTS HOLOGIC, INC. 2023 Proxy Statement
Following the 2021 review of our Primary Peer Group in March 2021, the Committee removed Varian Medial Systems, Inc. from our Primary Peer Group as a result of its pending acquisition by Siemens Healthineers and shifted Baxter International Inc. from our Supplemental Practices Peer Group (described below) to our Primary Peer Group given the Company’s growth. Our Primary Peer Group used for setting target compensation levels for the NEOs for fiscal 2022 is as follows: 2022 Primary Peer Group Composition | Agilent Technologies, Inc. | | | Illumina, Inc.
| | | Teleflex Incorporated
| | | IDEXX Laboratories, Inc. | | | Steris Plc | Baxter International Inc. | | | Illumina, Inc. | | | Teleflex Incorporated | Boston Scientific Corporation | | | Intuitive Surgical, Inc. | | | The Cooper Companies, Inc. | DENTSPLY Sirona, Inc. | | | PerkinElmer, Inc. | | | Waters Corporation | Edwards Lifesciences Corp. | | | ResMed, Inc. | | | Zimmer Biomet Holdings, Inc. | | Boston Scientific Corporation
| | | Intuitive Surgical, Inc.
| | | The Cooper Companies, Inc.
| |
50th Percentile | | | $3,200 | | | $38,000 | Hologic | | | $3,800 | | | $22,500 | Hologic Rank | | | 60th | | | 40th |
(1)
| Data as available January 2021. | | DENTSPLY Sirona, Inc.
|
Each year, Pearl Meyer conducts and presents to the Committee an executive compensation competitive assessment to assist the Committee in assessing whether executive target pay levels by element and in the aggregate are competitive in the marketplace. For fiscal 2022, the target annual TDC opportunities, comprised of base salary, target annual STIP, annual long-term incentive awards and deferred compensation contributions, were determined to be above market median for Messrs. MacMillan and Griffin and below market median for Ms. Oberton and Messrs. Thornal and Verstreken. | | | PerkinElmer, Inc.
| | | Varian Medical Systems, Inc.
| | | Edwards Lifesciences Corp.
| | | ResMed, Inc.
| | | Waters Corporation
| | | IDEXX Laboratories, Inc.
| | | Steris Plc
| | | Zimmer Biomet Holdings, Inc.
| |
Peer Group Data(1)
| 50th Percentile | | | $3,128 | | | $17,039 | | | Hologic | | | $3,325 | | | $15,553 | | | Hologic Rank | | | 55th | | | 45th | |
(1)
| Data as available January 2019. |
Each year, Pearl Meyer conducts and presents to the Committee an executive compensation competitive assessment to assist the Committee in assessing whether executive target pay levels by element and in the aggregate are competitive in the marketplace. For fiscal 2020, the target annual TDC opportunities, comprised of base salary, target annual STIP, annual long-term incentive awards and deferred compensation contributions, were determined to be competitive with market median for Mr. Griffin, above market median for Mr. MacMillan and below market median for Ms. Oberton and Messrs. Thornal and Valenti.
Changes to the Primary Peer Group Pearl Meyer and the Committee review our Primary Peer Group annually for appropriateness based on a variety of factors including: similarities in revenue levels and size of market capitalization and enterprise value, similarities to the industries in which we operate, the overlapping labor market for top management talent, our status as a publicly traded, U.S.-based, non-subsidiary company, and various other characteristics. The Company uses enterprise value in addition to market capitalization for comparative purposes because of its capital structure. TABLE OF CONTENTS
HOLOGIC, INC. 2021 Proxy Statement
Following the 20202022 review of our Primary Peer Group in March 2020,2022, the Committee did not make any changes. Ourchanges to the Primary Peer Group used for setting target compensation levels for the NEOs for fiscal 2021 is as follows:2023. | 2021 PeersSupplemental Practices Peer Group | | | Agilent Technologies, Inc.
Boston Scientific Corporation
DENTSPLY Sirona, Inc.
Edwards Lifesciences Corp.
IDEXX Laboratories, Inc.
Illumina, Inc.
Intuitive Surgical, Inc.
| | | PerkinElmer, Inc.
ResMed, Inc.
Steris Plc
Teleflex Incorporated
The Cooper Companies, Inc.
Varian Medical Systems, Inc.
Waters Corporation
Zimmer Biomet Holdings, Inc.
| |
Pearl Meyer also developed a Supplemental Practices Peer Group of larger companies to serve as a reference point in understanding design characteristics of compensation programs at larger companies. The group was not used to set compensation levels for the NEOs. The group consists of both direct product competitors and recent sources of executive talent. Below is the Supplemental Practices Peer Group which the Company referenced while assessing overall compensation design for fiscal 20202022 compensation. Supplemental Practices Peer Group Composition
| Abbott Laboratories | | | Johnson & Johnson | | | Stryker Corporation | | | Baxter International Inc.Becton, Dickinson and Company
| | | Medtronic plc | | | Thermo Fisher Scientific Inc. | |
| Becton, Dickinson and Company
| | | | | | 69 | |
TABLE OF CONTENTS HOLOGIC, INC. 2023 Proxy Statement
TSR Peer Group The Company uses a custom TSR Peer Group comprised of select companies from the Company investor relations performance benchmarking group and the executive compensation Peer Groups discussed above. The TSR Peer Group is approved by the Compensation Committee each year at the time the TSR PSU awards are granted. Companies which are acquired or otherwise delisted during the performance period are excluded from the final calculation. The TSR Peer Group reflects organizations from both our Primary Peer Group as well as our internal investor relations comparator group. Collectively, we believe this larger set of companies provides strong comparisons from a people, product and investor perspective. Moreover, this larger set of companies in the TSR Peer Group helps mitigate the impact of market consolidation by way of corporate actions such as acquisitions and divestitures. For the fiscal 20202022 TSR PSU awards, the following companies were set as the TSR Peer Group: 20202022 TSR Peer Group Composition
| Abbott Laboratories | | | IDEXX Laboratories, Inc. | | | Quest Diagnostics Inc.Qiagen NV
| | | Agilent Technologies, Inc. | | | Illumina, Inc. | | | ResMedQuest Diagnostics Inc.
| | | Baxter International Inc. | | | Integra LifeSciences Holdings Corp | | | Stryker CorporationResMed Inc.
| | | Becton, Dickinson and Company | | | Intuitive Surgical, Inc. | | | The Cooper Companies, Inc.Stryker Corporation
| | | Boston Scientific Corporation | | | Laboratory Corp. of America Holdings | | | Thermo Fisher ScientificThe Cooper Companies, Inc.
| | | Bruker Corporation | | | Mettler-Toledo International Inc. | | | Varian Medical Systems,Thermo Fisher Scientific Inc.
| | | DENTSPLY SIRONA Inc. | | | NuVasive, Inc. | | | Waters Corporation | | | DexCom, Inc. | | | PerkinElmer, Inc. | | | Zimmer Biomet Holdings, Inc. | | | Edwards Lifesciences Corp. | | | Qiagen NV
| | | | | | | | | | | | | |
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HOLOGIC, INC. 2021 Proxy Statement
Additional Compensation Practices, Policies & Guidelines Our Position on Employment, Change of Control and Severance AgreementsOUR POSITION ON EMPLOYMENT, CHANGE OF CONTROL AND SEVERANCE AGREEMENTS
Our ability to build the exceptional leadership team in place today was due in large part to our having a full complement of compensation tools available to us and the flexibility to use them. This includes the ability to leverage employment, change of control and severance agreements. The Committee believes that together, our employment, change of control and severance agreements, which are guided by our compensation philosophy and governance practices and policies (e.g., double-trigger change of control provisions, no tax gross-ups), are well aligned with those of our peers. More importantly, they foster stability within senior management by helping our executives maintain continued focus and dedication to their responsibilities to maximize stockholder value, including in the event of a transaction that could result in a change in control of our Company. The Committee believes that providing change of control and severance benefits eliminates, or at least reduces, any reluctance of senior management to pursue potential change of control transactions that may be in the best interests of stockholders. We also understand the concern of our stockholders regarding severance arrangements, and in 2015, the Committee adopted a Policy on Executive Severance Agreements. This policy limits severance benefits under any new severance or employment agreements entered into with executive officers to 2.99 times the sum of the executive officer’s base salary and non-equity incentive plan payment or other annual non-equity bonus or award; any benefits in excess of this amount must be ratified by stockholders. For purposes of this policy “severance benefits” do not include the value of accelerated vesting of any outstanding equity awards or payments under the Company’s retirement and deferred compensation plans. Details about the specific arrangements made with our NEOs are set forth on pages 7480 and 7581. Executive Stock Ownership GuidelinesEXECUTIVE STOCK OWNERSHIP GUIDELINES
Our Board believes that our directors and officers should hold a meaningful financial stake in the Company in order to further align their interests with those of our stockholders. Our CEO is expected to achieve equity ownership in the Company with a value of five times his then current base salary and each of our other NEOs and executive officers is expected to achieve equity ownership in the Company with a value of two times his or her then current base salary, within five years of becoming subject to the guidelines. Only shares of stock issued and outstanding (or vested and deferred under our deferred equity plan) are credited towards the ownership goals. No unvested RSUs or PSUs or outstanding stock TABLE OF CONTENTS HOLOGIC, INC. 2023 Proxy Statement
options (regardless of whether or not vested) are credited towards the ownership goals. All of our NEOs who have been subject to the guidelines for five years have achieved ownership in excess of the guideline. Information about ownership guidelines for our non-employee directors can be found in the “Director Compensation” section on page 3234 of this proxy statement. | Incentivized to Drive Stockholder Value | | | Mr. MacMillan is invested in Hologic. Literally. Under our stock ownership guidelines, he is expected to achieve equity ownership in the Company with a value of five times his base salary. As of the end of fiscal 2020,calendar year 2022, he owned equity in the Company with a value of over 81 times his fiscal 2020 base salary. The value of these shares held by Mr. MacMillan (including shares vested but deferred, but not including any unvested equity) is, in the Company with a value of over $89 million, based on the closing price per share of Hologic stock on September 25, 2020,146 times his fiscal 2022 base salary, making him one of our 3025 largest stockholders. Mr. MacMillan purchased over 17%approximately 11% of these shares in the open market. As evidenced by his substantial ownership of Hologic shares, Mr. MacMillan’s interests are well-aligned with those of our stockholders. | |
Compensation Recoupment Policy Under our compensation recoupment, or clawback, policy, if our Board determines that an officer engaged in fraud or willful misconduct that resulted in a restatement of the Company’s financial results, then the Board may review all performance-based compensation – both cashincentive cash/bonus awards and equityall forms of equity-based compensation – awarded to or earned by that officer on the basis of performance during the fiscal periods materially affected by the restatement. If, in the view of our Board, the performance-based compensation would have been lower if it had been based on the restated financial results, the Board may, to the extent permitted by applicable law, seek recoupment from that officer of any portion of such performance-based compensation as it deems appropriate after a review of all relevant facts and circumstances. Any recoupment under this policy may be in addition to, and shall not otherwise limit, any other remedies that may be available to the Company under applicable law, including disciplinary actions up to and including termination of employment. The Company is reviewing its compensation recoupment policy in light of the final Exchange Act Rule 10D-1 and expects to adopt a new policy or amend its policy upon or prior to the effectiveness of the final listing standards from Nasdaq implementing such rule. TABLE OF CONTENTS
HOLOGIC, INC. 2021 Proxy Statement
Hedging and Pledging Policy Our Insider Trading Policy prohibits employees and directors of the Company from engaging in hedging or similar arrangements with respect to the Company’s securities, including, without limitation, short sales and buying or selling puts, calls or other derivative securities (except for stock options granted by the Company). Pursuant to the Insider Trading Policy, employees and directors are also prohibited from holding Company securities in a margin account or otherwise pledging Company securities as collateral for a loan. Tax and Accounting Considerations The Committee considers tax and accounting implications in determining all elements of our compensation plans, programs and arrangements, although they are not the only factors considered. In some cases, other important considerations may outweigh tax or accounting considerations and the Committee maintains the flexibility to compensate its officers in accordance with the Company’s compensation philosophy. Section 162(m) of the Internal Revenue Code, of 1986, as amended, generally limits the deductibility of compensation to $1 million per year for certain named executive officers of the Company, except that historically Section 162(m) provided for an exemption for compensation that qualified as “performance-based compensation.” In the past, several elements of our named executive officers’ compensation were intended to be deductible under Section 162(m) as performance-based compensation. The Tax Cuts and Jobs Act of 2017 repealed the exemption from the Section 162(m) deduction limit for performance-based compensation, effective for taxable years beginning after December 31, 2017. As a result, we expect that compensation paid to our named executive officers in excess of $1 million generally will not be deductible. TABLE OF CONTENTS HOLOGIC, INC. 20212023 Proxy Statement
Executive Compensation Tables Summary Compensation Table The following table presents information regarding compensation of each of the NEOs for services rendered during the fiscal years indicated. A description of our compensation policies and practices as well as a description of the components of compensation payable to our NEOs is included above under “Compensation Discussion and Analysis.” | Stephen P. MacMillan Chairman, President and Chief Executive Officer | | | 2020 | | | 1,092,604 | | | — | | | 7,261,555 | | | 2,106,425 | | | 3,278,181 | | | — | | | 386,909(7) | | | 14,125,674 | | | 2019 | | | 1,060,900 | | | — | | | 7,082,065 | | | 2,027,373 | | | 1,814,139 | | | — | | | 390,276 | | | 12,374,753 | | | 2018 | | | 1,030,000 | | | — | | | 27,183,611 | | | 12,072,994 | | | 1,390,500 | | | — | | | 363,037 | | | 42,040,142 | | | Karleen M. Oberton Chief Financial Officer | | | 2020 | | | 499,954 | | | — | | | 1,263,365 | | | 424,989 | | | 675,000 | | | — | | | 274,099(8) | | | 3,137,407 | | | 2019 | | | 475,000 | | | — | | | 1,049,897 | | | 349,993 | | | 425,000 | | | — | | | 158,075 | | | 2,457,965 | | | 2018 | | | 376,032 | | | — | | | 262,379 | | | 87,492 | | | 337,500 | | | — | | | 76,240 | | | 1,139,643 | | | John M. Griffin
General Counsel | | | 2020 | | | 514,936 | | | — | | | 1,188,976 | | | 399,993 | | | 675,000 | | | — | | | 186,400(9) | | | 2,965,305 | | | 2019 | | | 495,000 | | | — | | | 1,124,991 | | | 374,995 | | | 440,000 | | | — | | | 188,038 | | | 2,623,024 | | | 2018 | | | 470,000 | | | — | | | 1,049,910 | | | 349,995 | | | 375,000 | | | — | | | 188,009 | | | 2,432,914 | | | Kevin R. Thornal Division President, Diagnostics | | | 2020 | | | 450,075 | | | 500,000(3) | | | 743,132 | | | 249,989 | | | 675,000 | | | | | | 255,290(10) | | | 2,873,486 | | | 2019 | | | 408,654 | | | 850,000(3) | | | 637,412 | | | 212,492 | | | 385,000 | | | — | | | 246,740 | | | 2,740,298 | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | Peter J. Valenti, III Former Division President, Breast & Skeletal Health | | | 2020 | | | 539,935 | | | — | | | 1,263,365 | | | 424,989 | | | 810,000 | | | — | | | 378,045(11) | | | 3,416,334 | | | 2019 | | | 510,000 | | | — | | | 1,049,897 | | | 349,993 | | | 470,000 | | | — | | | 210,437 | | | 2,590,327 | | | 2018 | | | 490,000 | | | — | | | 749,891 | | | 249,987 | | | 385,000 | | | — | | | 162,660 | | | 2,037,538 | |
Stephen P. MacMillan Chairman, President and Chief Executive Officer | | | 2022 | | | 1,130,236 | | | — | | | 7,600,629 | | | 2,499,983 | | | 2,544,687 | | | — | | | 560,097(6) | | | 14,335,632 | | 2021 | | | 1,092,727 | | | — | | | 7,759,570 | | | 2,474,782 | | | 2,835,627 | | | — | | | 585,694 | | | 14,748,400 | | 2020 | | | 1,092,604 | | | — | | | 7,261,555 | | | 2,106,425 | | | 3,278,181 | | | — | | | 386,909 | | | 14,125,674 | Karleen M. Oberton
Chief Financial Officer | | | 2022 | | | 599,038 | | | — | | | 1,520,068 | | | 499,988 | | | 675,000 | | | — | | | 303,525(7) | | | 3,597,619 | | 2021 | | | 549,039 | | | — | | | 1,489,638 | | | 475,102 | | | 715,000 | | | — | | | 339,346 | | | 3,568,125 | | 2020 | | | 499,954 | | | — | | | 1,263,365 | | | 424,989 | | | 675,000 | | | — | | | 274,099 | | | 3,137,407 | John M. Griffin
General Counsel | | | 2022 | | | 559,423 | | | — | | | 1,329,979 | | | 437,487 | | | 630,000 | | | — | | | 285,200(8) | | | 3,242,089 | | 2021 | | | 529,712 | | | — | | | 1,332,728 | | | 425,087 | | | 715,000 | | | — | | | 311,600 | | | 3,314,127 | | 2020 | | | 514,936 | | | — | | | 1,188,976 | | | 399,993 | | | 675,000 | | | — | | | 186,400 | | | 2,965,305 | Kevin R. Thornal
Group President,
Global Diagnostics
Solutions | | | 2022 | | | 548,077 | | | — | | | 1,329,979 | | | 437,487 | | | 646,875 | | | — | | | 362,455(9) | | | 3,324,873 | | 2021 | | | 474,519 | | | — | | | 1,097,433 | | | 350,065 | | | 675,000 | | | — | | | 515,373 | | | 3,112,390 | | 2020 | | | 450,075 | | | 500,000(2) | | | 743,132 | | | 249,989 | | | 675,000 | | | — | | | 255,290 | | | 2,873,486 | Jan Verstreken
Group President,
International(10) | | | 2022 | | | 581,806 | | | — | | | 1,139,960 | | | 374,986 | | | 602,473 | | | — | | | 54,194(11) | | | 2,753,419 |
(1)
| Reflects position on September 26, 2020,24, 2022, the last day of fiscal 2020. Mr. Valenti retired from the Company effective December 31, 2020. From the end of fiscal 2020 through his retirement, he transitioned from the role of Division President, Breast and Skeletal Health to Senior Advisor to the Chief Executive Officer. 2022. |
(2)
| For fiscal 2020, the amounts included in the “Salary” column also includes the amount of lump sum payments received by each NEO in November 2020 equal to the amount of the base salary reductions that occurred during fiscal 2020 as a result of the COVID-19 pandemic. |
(3)
| For fiscal 2020, represents a bonus paid to Mr. Thornal in recognition of his outstanding leadership and performance during the COVID-19 pandemic as the leader of our Diagnostics Division. For fiscal 2019, represents bonus paid in connection with Mr. Thornal assuming the role of Division President, Diagnostics, recognizing his work on the divestiture of the Company’s former Cynosure medical aesthetics division. |
(4)(3)
| The amounts included in the “Stock Awards” column represent the aggregate grant date fair value of RSUs and PSUs subject to ROIC goals (ROIC PSUs) and, PSUs subject to relative total shareholder return (TSR) goals (TSR PSUs) granted during the respective fiscal years and PSUs subject to adjusted free cash flow goals (FCF PSUs) granted during the respective fiscal 2020.years. These values have been determined as of the grant date of grant under GAAP based on the assumptions described in footnote 10 to our consolidated financial statements included in our Annual Report on Form 10-K for the year ended September 26, 2020.24, 2022. The RSUs (other than the matching RSUs discussed below) vest annually in equal installments over a required service period, and the PSUs cliff-vest at the end of a three-year period provided the pre-determined performance metrics are achieved (ROIC, relative TSR or adjusted FCF, as applicable). For the PSUs, the grant date fair value is based on our estimate of the probable outcome of the performance conditions applicable to each PSU award. Assuming the achievement of the highest level of performance conditions with respect to these PSUs (200% of target for the ROIC PSUs, TSR PSUs and the FCF PSUs), the maximum possible value of the ROIC, TSR and FCF PSUs, respectively, granted to our NEOs in fiscal 20202022 are: Mr. MacMillan: $2.8$3.3 million, $2.8$3.3 million and $2.8$3.3 million; Ms. Oberton: $567,000, $567,000$667,000, $667,000 and $567,000;$667,000; Mr. Griffin: $533,000, $533,000$583,000, $583,000 and $533,000;$583,000; Mr. Thornal: $333,000, $333,000$583,000, $583,000 and $333,000;$583,000 and Mr. Valenti: $567,000, $567,000Verstrekon: $499,902, $499,902 and $567,000. Mr. MacMillan’s stock awards in fiscal 2018 include his special retention equity grant with an aggregate grant date fair value of $20.0 million, split evenly between ROIC PSUs and TSR PSUs. For Mr. MacMillan, the stock awards in fiscal 2020, 2019 and 2018 also include matching RSUs granted on November 11, 2019, November 12, 2018 and December 1, 2017 with a fair value on the date of grant of $1.0 million, $1.0 million and $965,000, respectively, which is equal to the number of shares owned (up to a maximum of $1.0 million), including equity which is vested but deferred, by Mr. MacMillan as of September 28, 2019, September 29, 2018 and September 30, 2017 respectively. These matching RSUs were granted by the Company in accordance with Mr. MacMillan’s Employment Agreement and vest in one installment on the third anniversary of the grant date, assuming Mr. MacMillan is employed by the Company on that date. For more information, see “Mr. MacMillan’s Employment Agreement” on page 47. $499,902. |
TABLE OF CONTENTS
HOLOGIC, INC. 2021 Proxy Statement
(5)(4)
| The amount included in the “Options Awards” column represents the grant date fair value of all stock options granted during the respective fiscal year. These stock options vest annually in equal installments over a required service period of four years and have a 10-year term. The values have been determined as of the grant date of grant under GAAP based on the assumptions described in footnote 10 to our consolidated financial statements included in our Annual Report on Form 10-K for the year ended September 26, 2020. Mr. MacMillan’s option awards in fiscal 2018 include a special retention stock option award with an aggregate grant date fair value of $10.0 million.24, 2022. |
(6)(5)
| Represents cash payments under the STIP. Bonuses paid under the 2020, 20192022, 2021 and 20182020 STIP were based on a combination of Company and individual performance factors for the applicable fiscal year. For more information, see “Fiscal 20202022 Total Direct Compensation Elements in Detail—Short-TermDetail-Short-Term Incentive Plan” on page 4854. |
(7)(6)
| The amount represents (i) the Company’s contributions to the DCP in the amount of $285,000;$432,500; (ii) the Company’s matching contributions under our 401(k) Savings and Investment Plan of $11,400;$12,200; (iii) value of Mr. MacMillan’s personal use of a leased automobile provided by the Company of $14,360.54;$17,375; (iv) reimbursement and payment of expenses related to the Company’s annual salesforce reward trip of $43,872.73;$54,826; (v) tax reimbursements of $6,786.86$12,543 related to the Company’s annual salesforce reward trip; and (vi) $25,489.21$16,643 attributable to the personal use of private aircraft, net of all standard industry fare level (SIFL) reimbursements paid by Mr. MacMillan.MacMillan; and (vii) travel expenses of $14,010 in connection with the attendance of Mr. MacMillan’s spouse on a business trip. |
TABLE OF CONTENTS HOLOGIC, INC. 2023 Proxy Statement
(8)(7)
| The amount represents (i) the Company’s contributions to the DCP in the amount of $260,000; and$267,000; (ii) the Company’s matching contributions under our 401(k) Savings and Investment Plan of $14,099.11.$4,154; (iii) an automobile allowance of $7,800; (iv) reimbursement of expenses related to the Company’s annual salesforce reward trip of $17,493; and (v) tax reimbursements of $7,078 related to the Company’s annual salesforce reward trip. |
(9)(8)
| The amount represents (i) the Company’s contributions to the DCP in the amount of $175,000; and$267,000; (ii) the Company’s matching contributions under our 401(k) Savings and Investment Plan of $11,400.$12,200; and (iii) an automobile allowance of $6,000. |
(10)(9)
| The amount represents (i) the Company’s contributions to the DCP in the amount of $135,000;$225,000; (ii) the Company’s matching contributions under our 401(k) Savings and Investment Plan of $11,400;$12,206; (iii) an automobile allowance of $7,800; (iv) reimbursement of expenses related to the Company’s annual salesforce reward trip of $14,759.87;$18,693; (v) tax reimbursements of $7,499.14$9,493 related to the Company’s annual salesforce reward trip; and (vi) moving allowanceexpatriate host country tax gross-up payment related to the holdover tax liability from expatriate assignment prior to becoming an executive officer, consistent with practice for all employees on expatriate assignment, made during fiscal 2022 of $78,831.47.$89,263. |
(10)
| The Company converted Mr. Verstreken’s compensation in UK Pound to U.S. Dollar using the average exchange rate for the fiscal year. Mr. Verstreken first became an NEO for fiscal year 2022 and was not an NEO for fiscal year 2020 or 2021. |
(11)
| The amount represents (i) the Company’s contributions to the DCPhousing allowance in the amount of $335,000;$33,879; and (ii) the Company’s matching contributions under our 401(k) Savings and Investment Plan of $11,400; (iii)an automobile allowance of $6,000; (iv) reimbursement of expenses related to the Company’s annual salesforce reward trip of $17,501.59; and (v) tax reimbursements of $8,143.20 related to the Company’s annual salesforce reward trip.$20,315. |
TABLE OF CONTENTS HOLOGIC, INC. 20212023 Proxy Statement
Grants of Plan-Based Awards | Stephen P. MacMillan | | | | | | | | | 819,545 | | | 1,639,091 | | | 3,278,181 | | | | | | | | | | | | | | | | | | | | | | | | | | | 11/11/2019 | | | 11/4/2019 | | | | | | | | | | | | | | | | | | | | | 46,183 | | | | | | | | | 2,106,407 | | | | | | 11/11/2019 | | | 11/4/2019 | | | | | | | | | | | | | | | | | | | | | | | | 152,529 | | | 45.61 | | | 2,106,425 | | | | | | 11/11/2019 | | | 11/4/2019 | | | | | | | | | | | | | | | | | | | | | 21,925(5) | | | | | | | | | 999,999 | | | | | | 11/11/2019 | | | 11/4/2019 | | | | | | | | | | | | 15,394 | | | 30,788 | | | 61,576 | | | | | | | | | | | | 1,404,241 | | | | | | 11/11/2019 | | | 11/4/2019 | | | | | | | | | | | | 15,394 | | | 30,788 | | | 61,576 | | | | | | | | | | | | 1,346,667 | | | | | | 11/11/2019 | | | 11/4/2019 | | | | | | | | | | | | 15,394 | | | 30,788 | | | 61,576 | | | | | | | | | | | | 1,404,241 | | | Karleen M. Oberton | | | | | | | | | 187,500 | | | 375,000 | | | 750,000 | | | | | | | | | | | | | | | | | | | | | | | | | | | 11/11/2019 | | | 11/4/2019 | | | | | | | | | | | | | | | | | | | | | 9,318 | | | | | | | | | 424,994 | | | | | | 11/11/2019 | | | 11/4/2019 | | | | | | | | | | | | | | | | | | | | | | | | 30,774 | | | 45.61 | | | 424,989 | | | | | | 11/11/2019 | | | 11/4/2019 | | | | | | | | | | | | 3,106 | | | 6,212 | | | 12,424 | | | | | | | | | | | | 283,329 | | | | | | 11/11/2019 | | | 11/4/2019 | | | | | | | | | | | | 3,106 | | | 6,212 | | | 12,424 | | | | | | | | | | | | 271,713 | | | | | | 11/11/2019 | | | 11/4/2019 | | | | | | | | | | | | 3,106 | | | 6,212 | | | 12,424 | | | | | | | | | | | | 283,329 | | | John M. Griffin | | | | | | | | | 193,125 | | | 386,250 | | | 772,500 | | | | | | | | | | | | | | | | | | | | | | | | | | | 11/11/2019 | | | 11/4/2019 | | | | | | | | | | | | | | | | | | | | | 8,770 | | | | | | | | | 400,000 | | | | | | 11/11/2019 | | | 11/4/2019 | | | | | | | | | | | | | | | | | | | | | | | | 28,964 | | | 45.61 | | | 399,993 | | | | | | 11/11/2019 | | | 11/4/2019 | | | | | | | | | | | | 2,923 | | | 5,846 | | | 11,692 | | | | | | | | | | | | 266,636 | | | | | | 11/11/2019 | | | 11/4/2019 | | | | | | | | | | | | 2,923 | | | 5,846 | | | 11,692 | | | | | | | | | | | | 255,704 | | | | | | 11/11/2019 | | | 11/4/2019 | | | | | | | | | | | | 2,923 | | | 5,846 | | | 11,692 | | | | | | | | | | | | 266,636 | | | Kevin R. Thornal | | | | | | | | | 168,750 | | | 337,500 | | | 675,000 | | | | | | | | | | | | | | | | | | | | | | | | | | | 11/11/2019 | | | 11/4/2019 | | | | | | | | | | | | | | | | | | | | | 5,481 | | | | | | | | | 249,988 | | | | | | 11/11/2019 | | | 11/4/2019 | | | | | | | | | | | | | | | | | | | | | | | | 18,102 | | | 45.61 | | | 249,989 | | | | | | 11/11/2019 | | | 11/4/2019 | | | | | | | | | | | | 1,827 | | | 3,654 | | | 7,308 | | | | | | | | | | | | 166,659 | | | | | | 11/11/2019 | | | 11/4/2019 | | | | | | | | | | | | 1,827 | | | 3,654 | | | 7,308 | | | | | | | | | | | | 159,826 | | | | | | 11/11/2019 | | | 11/4/2019 | | | | | | | | | | | | 1,827 | | | 3,654 | | | 7,308 | | | | | | | | | | | | 166,659 | | | Peter J. Valenti, III | | | | | | | | | 202,500 | | | 405,000 | | | 810,000 | | | | | | | | | | | | | | | | | | | | | | | | | | | 11/11/2019 | | | 11/4/2019 | | | | | | | | | | | | | | | | | | | | | 9,318 | | | | | | | | | 424,994 | | | | | | 11/11/2019 | | | 11/4/2019 | | | | | | | | | | | | | | | | | | | | | | | | 30,774 | | | 45.61 | | | 424,989 | | | | | | 11/11/2019 | | | 11/4/2019 | | | | | | | | | | | | 3,106 | | | 6,212 | | | 12,424 | | | | | | | | | | | | 283,329 | | | | | | 11/11/2019 | | | 11/4/2019 | | | | | | | | | | | | 3,106 | | | 6,212 | | | 12,424 | | | | | | | | | | | | 271,713 | | | | | | 11/11/2019 | | | 11/4/2019 | | | | | | | | | | | | 3,106 | | | 6,212 | | | 12,424 | | | | | | | | | | | | 283,329 | |
Stephen P. MacMillan | | | | | | | | | 848,229 | | | 1,696,458 | | | 3,392,916 | | | | | | | | | | | | | | | | | | | | | | | | | 11/08/2021 | | | 11/1/2021 | | | | | | | | | | | | | | | | | | | | | 35,146 | | | | | | | | | 2,499,935 | | | | 11/08/2021 | | | 11/1/2021 | | | | | | | | | | | | | | | | | | | | | | | | 118,877 | | | 71.13 | | | 2,499,983 | | | | 11/08/2021 | | | 11/1/2021 | | | | | | | | | | | | 11,716 | | | 23,431 | | | 46,862 | | | | | | | | | | | | 1,666,647 | | | | 11/08/2021 | | | 11/1/2021 | | | | | | | | | | | | 11,716 | | | 23,431 | | | 46,862 | | | | | | | | | | | | 1,767,400 | | | | 11/08/2021 | | | 11/1/2021 | | | | | | | | | | | | 11,716 | | | 23,431 | | | 46,862 | | | | | | | | | | | | 1,666,647 | Karleen M. Oberton | | | | | | | | | 225,000 | | | 450,000 | | | 900,000 | | | | | | | | | | | | | | | | | | | | | | | | | 11/08/2021 | | | 11/1/2021 | | | | | | | | | | | | | | | | | | | | | 7,029 | | | | | | | | | 499,973 | | | | 11/08/2021 | | | 11/1/2021 | | | | | | | | | | | | | | | | | | | | | | | | 23,775 | | | 71.13 | | | 499,988 | | | | 11/08/2021 | | | 11/1/2021 | | | | | | | | | | | | 2,343 | | | 4,686 | | | 9,372 | | | | | | | | | | | | 333,315 | | | | 11/08/2021 | | | 11/1/2021 | | | | | | | | | | | | 2,343 | | | 4,686 | | | 9,372 | | | | | | | | | | | | 353,465 | | | | 11/08/2021 | | | 11/1/2021 | | | | | | | �� | | | | | 2,343 | | | 4,686 | | | 9,372 | | | | | | | | | | | | 333,315 | John M. Griffin | | | | | | | | | 210,000 | | | 420,000 | | | 840,000 | | | | | | | | | | | | | | | | | | | | | | | | | 11/08/2021 | | | 11/1/2021 | | | | | | | | | | | | | | | | | | | | | 6,150 | | | | | | | | | 437,450 | | | | 11/08/2021 | | | 11/1/2021 | | | | | | | | | | | | | | | | | | | | | | | | 20,803 | | | 71.13 | | | 437,487 | | | | 11/08/2021 | | | 11/1/2021 | | | | | | | | | | | | 2,050 | | | 4,100 | | | 8,200 | | | | | | | | | | | | 291,633 | | | | 11/08/2021 | | | 11/1/2021 | | | | | | | | | | | | 2,050 | | | 4,100 | | | 8,200 | | | | | | | | | | | | 309,263 | | | | 11/08/2021 | | | 11/1/2021 | | | | | | | | | | | | 2,050 | | | 4,100 | | | 8,200 | | | | | | | | | | | | 291,633 | Kevin R. Thornal | | | | | | | | | 215,625 | | | 431,250 | | | 862,500 | | | | | | | | | | | | | | | | | | | | | | | | | 11/08/2021 | | | 11/1/2021 | | | | | | | | | | | | | | | | | | | | | 6,150 | | | | | | | | | 437,450 | | | | 11/08/2021 | | | 11/1/2021 | | | | | | | | | | | | | | | | | | | | | | | | 20,803 | | | 71.13 | | | 437,487 | | | | 11/08/2021 | | | 11/1/2021 | | | | | | | | | | | | 2,050 | | | 4,100 | | | 8,200 | | | | | | | | | | | | 291,633 | | | | 11/08/2021 | | | 11/1/2021 | | | | | | | | | | | | 2,050 | | | 4,100 | | | 8,200 | | | | | | | | | | | | 309,263 | | | | 11/08/2021 | | | 11/1/2021 | | | | | | | | | | | | 2,050 | | | 4,100 | | | 8,200 | | | | | | | | | | | | 291,633 | Jan Verstreken(5) | | | | | | | | | 200,824 | | | 401,649 | | | 803,298 | | | | | | | | | | | | | | | | | | | | | | | | | 11/08/2021 | | | 11/1/2021 | | | | | | | | | | | | | | | | | | | | | 5,272 | | | | | | | | | 374,997 | | | | 11/08/2021 | | | 11/1/2021 | | | | | | | | | | | | | | | | | | | | | | | | 17,831 | | | 71.13 | | | 374,986 | | | | 11/08/2021 | | | 11/1/2021 | | | | | | | | | | | | 1,757 | | | 3,514 | | | 7,028 | | | | | | | | | | | | 249,951 | | | | 11/08/2021 | | | 11/1/2021 | | | | | | | | | | | | 1,757 | | | 3,514 | | | 7,028 | | | | | | | | | | | | 265,061 | | | | 11/08/2021 | | | 11/1/2021 | | | | | | | | | | | | 1,757 | | | 3,514 | | | 7,028 | | | | | | | | | | | | 249,951 |
(1)
| Represents threshold, target and maximum annual cash incentive awards under the 20202022 STIP. The threshold amount for each NEO is 50% of target, as the minimum amount payable (subject to individual performance) if threshold performance is achieved. If the threshold is not achieved, the payment to the NEOs would be zero. The maximum amount for each NEO is 200% of target and reflects the maximum amount payable (subject to individual performance) if maximum performance is achieved. Payout is based upon achievement of the performance measures listed in the “2020“2022 Performance Objectives and Results” in the CD&A on page 4955. The actual amounts earned by each NEO are set forth in the Summary Compensation Table. |
(2)
| Represents threshold, target and maximum award amounts for the FY20-FY22FY21-FY23 performance cycle pursuant to ROIC PSUs, TSR PSUs and FCF PSUs issued as part of our fiscal 20202022 annual equity awards. The PSUs are subject to ROIC goals, relative TSR achievement goals and adjusted FCF achievement goals, as applicable. |
• | ROIC PSUs. ROIC PSUs vestbecome earned only if the Company achieves a pre-determined average ROIC threshold at the end of a three-year performance period and vest at the end of a three-year service period. If we fail to achieve the three-year average ROIC minimum threshold, all ROIC PSUs for that three-year performance period will be forfeited. If the target three-year average ROIC goal is achieved, 100% of the ROIC PSUs will vest.become earned. The maximum payout for ROIC PSUs is limited to 200% of the shares granted and is earned only if we achieve the maximum three-year average ROIC goal. See “Performance Stock Units – ROIC PSUs” on page 5561 for applicable ROIC goals. |
• | TSR PSUs. TSR PSUs vest only if the Company achieves a minimum relative TSR percentile at the end of a three-year performance period. If we fail to achieve the minimum relative TSR percentile, all of the TSR PSUs for that three-year performance period will be forfeited. The maximum payout for TSR PSUs is limited to 200% of the shares granted and is earned only if we achieve the maximum relative TSR percentile. For TSR PSUs, threshold, target and maximum award amounts are payable upon achievement of relative TSR in the 25th, 50th25th, 50th and 95th95th percentile, respectively. |
• | FCF PSUs. FCF PSUs vestbecome earned only if the Company achieves a one-yearthree-year adjusted free cash flow measure and the awards vest at the end of the three-year service period. If we fail to achieve the minimum adjusted FCF measure, all of the FCF PSUs for that one-yearthree-year performance period will be forfeited. The maximum payout for FCF PSUs is limited to 200% of the shares granted and is earned only if we achieve the maximum adjusted FCF measure. |
TABLE OF CONTENTS
HOLOGIC, INC. 2021 Proxy Statement
(3)
| Represents RSUs issued as part of our fiscal 20202022 annual equity awards. |
(4)
| This column shows the full grant date fair value of RSUs, ROIC PSUs, TSR PSUs, FCF PSUs and stock options as determined under GAAP. The values are determined based on the assumptions described in Note 10 to our consolidated financial statements included in our Annual Report on Form 10-K for the year ended September 26, 2020.24, 2022. |
(5)
| Represents matching RSUs granted pursuantThe Company converted Mr. Verstreken’s compensation in UK Pound to U.S. Dollar using the terms of Mr. MacMillan’s Employment Agreement. For more information, see “Mr. MacMillan’s Employment Agreement” beginning on page 47. average exchange rate for the fiscal year. |
Outstanding Equity Awards at Fiscal Year-End | Stephen P. MacMillan | | | 11/7/2014 | | | 190,844(3) | | | — | | | 26.21 | | | 11/07/2024 | | | | | | | | | | | | | | | | | | 11/5/2015 | | | 138,358 | | | — | | | 39.96 | | | 11/05/2025 | | | | | | | | | | | | | | | | | | 12/1/2016 | | | 120,423 | | | 40,142(4) | | | 37.64 | | | 12/01/2026 | | | | | | | | | | | | | | | | | | 12/1/2017 | | | 463,988 | | | 463,990(4) | | | 40.85 | | | 12/01/2027 | | | | | | | | | | | | | | | | | | 11/12/2018 | | | 37,767 | | | 113,304(4) | | | 40.97 | | | 11/12/2028 | | | | | | | | | | | | | | | | | | 11/11/2019 | | | — | | | 152,529(4) | | | 45.61 | | | 11/11/2029 | | | | | | | | | | | | | | | | | | 12/1/2017 | | | | | | | | | | | | | | | 16,916(5) | | | 1,088,545 | | | | | | | | | | | | 11/12/2018 | | | | | | | | | | | | | | | 32,990(5) | | | 2,122,907 | | | | | | | | | | | | 11/12/2018 | | | | | | | | | | | | | | | 24,408(6) | | | 1,570,655 | | | | | | | | | | | | 12/1/2017 | | | | | | | | | | | | | | | 23,616(6) | | | 1,519,690 | | | | | | | | | | | | 11/11/2019 | | | | | | | | | | | | | | | 46,183(5) | | | 2,971,876 | | | | | | | | | | | | 11/11/2019 | | | | | | | | | | | | | | | 21,925(6) | | | 1,410,874 | | | | | | | | | | | | 12/1/2017 | | | | | | | | | | | | | | | 502,424(7) | | | 32,330,984 | | | | | | | | | | | | 12/1/2017 | | | | | | | | | | | | | | | 344,313(7) | | | 22,156,542 | | | | | | | | | | | | 11/11/2019 | | | | | | | | | | | | | | | 53,571(7)(10) | | | 3,447,294 | | | | | | | | | | | | 11/12/2018 | | | | | | | | | | | | | | | | | | | | | 98,968(8) | | | 6,368,591 | | | | | | 11/12/2018 | | | | | | | | | | | | | | | | | | | | | 73,548(9) | | | 4,732,814 | | | | | | 11/11/2019 | | | | | | | | | | | | | | | | | | | | | 61,576(8) | | | 3,962,416 | | | | | | 11/11/2019 | | | | | | | | | | | | | | | | | | | | | 61,576(9) | | | 3,962,416 | | | Karleen M. Oberton | | | 11/5/2015 | | | 7,156(4) | | | — | | | 39.96 | | | 11/05/2025 | | | | | | | | | | | | | | | | | | 12/1/2016 | | | 5,541 | | | 1,848(4) | | | 37.64 | | | 12/01/2026 | | | | | | | | | | | | | | | | | | 12/1/2017 | | | 3,362 | | | 3,363(4) | | | 40.85 | | | 12/01/2027 | | | | | | | | | | | | | | | | | | 11/12/2018 | | | 6,520 | | | 19,560(4) | | | 40.97 | | | 11/12/2028 | | | | | | | | | | | | | | | | | | 11/11/2019 | | | — | | | 30,774(4) | | | 45.61 | | | 11/11/2029 | | | | | | | | | | | | | | | | | | 12/1/2017 | | | | | | | | | | | | | | | 714(5) | | | 45,946 | | | | | | | | | | | | 11/12/2018 | | | | | | | | | | | | | | | 5,695(5) | | | 366,473 | | | | | | | | | | | | 11/12/2018 | | | | | | | | | | | | | | | 9,318(5) | | | 599,613 | | | | | | | | | | | | 12/1/2017 | | | | | | | | | | | | | | | 3,639(7) | | | 234,170 | | | | | | | | | | | | 12/1/2017 | | | | | | | | | | | | | | | 2,494(7) | | | 160,489 | | | | | | | | | | | | 11/11/2019 | | | | | | | | | | | | | | | 10,808(7)(10) | | | 695,495 | | | | | | | | | | | | 11/12/2018 | | | | | | | | | | | | | | | | | | | | | 17,084(8) | | | 1,099,355 | | | | | | 11/12/2018 | | | | | | | | | | | | | | | | | | | | | 12,696(9) | | | 816,988 | | | | | | 11/11/2019 | | | | | | | | | | | | | | | | | | | | | 12,424(8) | | | 799,484 | | | | | | 11/11/2019 | | | | | | | | | | | | | | | | | | | | | 12,424(9) | | | 799,484 | |
TABLE OF CONTENTS
HOLOGIC, INC. 2021 Proxy Statement
| John M. Griffin | | | 11/5/2015 | | | 22,900(4) | | | — | | | 39.96 | | | 11/05/2025 | | | | | | | | | | | | | | | | | | 12/1/2016 | | | 20,012 | | | 6,671(4) | | | 37.64 | | | 12/01/2026 | | | | | | | | | | | | | | | | | | 12/1/2018 | | | 13,450 | | | 13,452(4) | | | 40.85 | | | 12/01/2027 | | | | | | | | | | | | | | | | | | 11/12/2018 | | | 6,985 | | | 20,958(4) | | | 40.97 | | | 11/12/2028 | | | | | | | | | | | | | | | | | | 11/11/2019 | | | — | | | 28,964(4) | | | 45.61 | | | 11/11/2029 | | | | | | | | | | | | | | | | | | 12/1/2017 | | | | | | | | | | | | | | | 2,856(5) | | | 183,784 | | | | | | | | | | | | 11/12/2018 | | | | | | | | | | | | | | | 6,102(5) | | | 392,664 | | | | | | | | | | | | 11/11/2019 | | | | | | | | | | | | | | | 8,770(5) | | | 564,350 | | | | | | | | | | | | 12/1/2017 | | | | | | | | | | | | | | | 14,563(7) | | | 937,129 | | | | | | | | | | | | 12/1/2017 | | | | | | | | | | | | | | | 9,981(7) | | | 642,277 | | | | | | | | | | | | 11/11/2019 | | | | | | | | | | | | | | | 10,172(7)(10) | | | 654,568 | | | | | | | | | | | | 11/12/2018 | | | | | | | | | | | | | | | | | | | | | 18,306(8) | | | 1,177,991 | | | | | | 11/12/2018 | | | | | | | | | | | | | | | | | | | | | 13,604(9) | | | 875,417 | | | | | | 11/11/2019 | | | | | | | | | | | | | | | | | | | | | 11,692(8) | | | 752,380 | | | | | | 11/11/2019 | | | | | | | | | | | | | | | | | | | | | 11,692(9) | | | 752,380 | | | Kevin R. Thornal | | | 11/5/2015 | | | 7,633(4) | | | — | | | 39.96 | | | 11/05/2025 | | | | | | | | | | | | | | | | | | 12/1/2016 | | | 6,927 | | | 2,309(4) | | | 37.64 | | | 12/01/2026 | | | | | | | | | | | | | | | | | | 12/1/2017 | | | 6,244 | | | 6,246(4) | | | 40.85 | | | 12/01/2027 | | | | | | | | | | | | | | | | | | 11/12/2018 | | | 3,958 | | | 11,876(4) | | | 40.97 | | | 11/12/2028 | | | | | | | | | | | | | | | | | | 11/11/2019 | | | — | | | 18,102(4) | | | 45.61 | | | 11/11/2029 | | | | | | | | | | | | | | | | | | 12/1/2017 | | | | | | | | | | | | | | | 1,326(5) | | | 85,328 | | | | | | | | | | | | 11/12/2018 | | | | | | | | | | | | | | | 3,458(5) | | | 222,522 | | | | | | | | | | | | 11/11/2019 | | | | | | | | | | | | | | | 5,481(5) | | | 352,702 | | | | | | | | | | | | 12/1/2017 | | | | | | | | | | | | | | | 6,760(7) | | | 435,006 | | | | | | | | | | | | 12/1/2017 | | | | | | | | | | | | | | | 4,633(7) | | | 298,134 | | | | | | | | | | | | 11/11/2019 | | | | | | | | | | | | | | | 6,357(7)(10) | | | 409,073 | | | | | | | | | | | | 11/12/2018 | | | | | | | | | | | | | | | | | | | | | 10,372(8) | | | 667,438 | | | | | | 11/12/2018 | | | | | | | | | | | | | | | | | | | | | 7,708(9) | | | 496,010 | | | | | | 11/11/2019 | | | | | | | | | | | | | | | | | | | | | 7,308(8) | | | 470,270 | | | | | | 11/11/2019 | | | | | | | | | | | | | | | | | | | | | 7,308(9) | | | 470,270 | |
TABLE OF CONTENTS HOLOGIC, INC. 20212023 Proxy Statement
| Peter J. Valenti, III | | | 11/5/2015 | | | 19,083(4) | | | — | | | 39.96 | | | 11/05/2025 | | | | | | | | | | | | | | | | | | 12/1/2016 | | | 20,012 | | | 6,671(4) | | | 37.64 | | | 12/01/2026 | | | | | | | | | | | | | | | | | | 12/1/2017 | | | 9,607 | | | 9,608(4) | | | 40.85 | | | 12/01/2027 | | | | | | | | | | | | | | | | | | 11/12/2018 | | | 6,520 | | | 19,560(4) | | | 40.97 | | | 11/12/2028 | | | | | | | | | | | | | | | | | | 11/11/2019 | | | — | | | 30,774(4) | | | 45.61 | | | 11/11/2029 | | | | | | | | | | | | | | | | | | 12/1/2017 | | | | | | | | | | | | | | | 2,040(5) | | | 131,274 | | | | | | | | | | | | 11/12/2018 | | | | | | | | | | | | | | | 5,695(5) | | | 366,473 | | | | | | | | | | | | 11/11/2019 | | | | | | | | | | | | | | | 9,318(5) | | | 599,613 | | | | | | | | | | | | 12/1/2017 | | | | | | | | | | | | | | | 10,402(7) | | | 669,369 | | | | | | | | | | | | 12/1/2017 | | | | | | | | | | | | | | | 7,128(7) | | | 458,687 | | | | | | | | | | | | 11/11/2019 | | | | | | | �� | | | | | | | | 10,808(7)(10) | | | 695,495 | | | | | | | | | | | | 11/12/2018 | | | | | | | | | | | | | | | | | | | | | 17,084(8) | | | 1,099,355 | | | | | | 11/12/2018 | | | | | | | | | | | | | | | | | | | | | 12,696(9) | | | 816,988 | | | | | | 11/11/2019 | | | | | | | | | | | | | | | | | | | | | 12,424(8) | | | 799,484 | | | | | | 11/11/2019 | | | | | | | | | | | | | | | | | | | | | 12,424(9) | | | 799,484 | |
Outstanding Equity Awards at Fiscal Year-End Stephen P. MacMillan | | | 11/7/2014 | | | 190,844(3) | | | — | | | 26.21 | | | 11/07/2024 | | | | | | | | | | | | | | | | 11/5/2015 | | | 138,358(4) | | | — | | | 39.96 | | | 11/05/2025 | | | | | | | | | | | | | | | | 12/1/2016 | | | 160,565(4) | | | — | | | 37.64 | | | 12/01/2026 | | | | | | | | | | | | | | | | 12/1/2017 | | | 927,978(4) | | | — | | | 40.85 | | | 12/01/2027 | | | | | | | | | | | | | | | | 11/12/2018 | | | 113,303 | | | 37,768(4) | | | 40.97 | | | 11/12/2028 | | | | | | | | | | | | | | | | 11/11/2019 | | | 76,264 | | | 76,265(4) | | | 45.61 | | | 11/11/2029 | | | | | | | | | | | | | | | | 11/9/2020 | | | 30,950 | | | 92,851(4) | | | 68.35 | | | 11/09/2030 | | | | | | | | | | | | | | | | 11/8/2021 | | | — | | | 118,877(4) | | | 71.13 | | | 11/08/2031 | | | | | | | | | | | | | | | | 11/11/2019 | | | | | | | | | | | | | | | 15,395(5) | | | 969,577 | | | | | | | | | | 11/11/2019 | | | | | | | | | | | | | | | 21,925(6) | | | 1,380,837 | | | | | | | | | | 11/9/2020 | | | | | | | | | | | | | | | 24,133(5) | | | 1,519,896 | | | | | | | | | | 11/8/2021 | | | | | | | | | | | | | | | 35,146(5) | | | 2,213,495 | | | | | | | | | | 11/11/2019 | | | | | | | | | | | | | | | 61,576(7)(8) | | | 3,878,056 | | | | | | | | | | 11/11/2019 | | | | | | | | | | | | | | | 41,872(7)(10) | | | 2,637,078 | | | | | | | | | | 11/11/2019 | | | | | | | | | | | | | | | 53,571(11)(12) | | | 3,373,902 | | | | | | | | | | 11/9/2020 | | | | | | | | | | | | | | | 48,266(7)(9) | | | 3,039,793 | | | | | | | | | | 11/9/2020 | | | | | | | | | | | | | | | 48,266(7)(12) | | | 3,039,793 | | | | | | | | | | 11/9/2020 | | | | | | | | | | | | | | | | | | | | | 48,266(10) | | | 3,039,793 | | | | 11/8/2021 | | | | | | | | | | | | | | | | | | | | | 46,862(8) | | | 2,951,369 | | | | 11/8/2021 | | | | | | | | | | | | | | | | | | | | | 46,862(13) | | | 2,951,369 | | | | 11/8/2021 | | | | | | | | | | | | | | | | | | | | | 46,862 (10) | | | 2,951,369 | Karleen M. Oberton | | | 11/5/2015 | | | 7,156(4) | | | — | | | 39.96 | | | 11/05/2025 | | | | | | | | | | | | | | | | 12/1/2016 | | | 7,389(4) | | | — | | | 37.64 | | | 12/01/2026 | | | | | | | | | | | | | | | | 12/1/2017 | | | 6,725(4) | | | — | | | 40.85 | | | 12/01/2027 | | | | | | | | | | | | | | | | 11/12/2018 | | | 19,560 | | | 6,520(4) | | | 40.97 | | | 11/12/2028 | | | | | | | | | | | | | | | | 11/11/2019 | | | 15,386 | | | 15,388(4) | | | 45.61 | | | 11/11/2029 | | | | | | | | | | | | | | | | 11/9/2020 | | | 5,941 | | | 17,826(4) | | | 68.35 | | | 11/09/2030 | | | | | | | | | | | | | | | | 11/08/2021 | | | — | | | 23,775(4) | | | 71.13 | | | 11/08/2031 | | | | | | | | | | | | | | | | 11/11/2019 | | | | | | | | | | | | | | | 3,106(5) | | | 195,616 | | | | | | | | | | 11/9/2020 | | | | | | | | | | | | | | | 4,633(5) | | | 291,786 | | | | | | | | | | 11/8/2021 | | | | | | | | | | | | | | | 7,029(5) | | | 442,686 | | | | | | | | | | 11/11/2019 | | | | | | | | | | | | | | | 12,424(7)(8) | | | 782,464 | | | | | | | | | | 11/11/2019 | | | | | | | | | | | | | | | 8,448(7)(10) | | | 532,075 | | | | | | | | | | 11/11/2019 | | | | | | | | | | | | | | | 10,808(11)(12) | | | 680,688 | | | | | | | | | | 11/9/2020 | | | | | | | | | | | | | | | 9,266(7)(9) | | | 583,573 | | | | | | | | | | 11/9/2020 | | | | | | | | | | | | | | | 9,266(7)(12) | | | 583,573 | | | | | | | | | | 11/9/2020 | | | | | | | | | | | | | | | | | | | | | 9,266(10) | | | 583,573 | | | | 11/8/2021 | | | | | | | | | | | | | | | | | | | | | 9,372(8) | | | 590,249 | | | | 11/8/2021 | | | | | | | | | | | | | | | | | | | | | 9,372(13) | | | 590,249 | | | | 11/8/2021 | | | | | | | | | | | | | | | | | | | | | 9,372(10) | | | 590,249 |
TABLE OF CONTENTS HOLOGIC, INC. 2023 Proxy Statement
John M. Griffin | | | 12/1/2017 | | | 26,902(4) | | | — | | | 40.85 | | | 12/01/2027 | | | | | | | | | | | | | | | | 11/12/2018 | | | 20,957 | | | 6,986(4) | | | 40.97 | | | 11/12/2028 | | | | | | | | | | | | | | | | 11/11/2019 | | | 14,482 | | | 14,482(4) | | | 45.61 | | | 11/11/2029 | | | | | | | | | | | | | | | | 11/9/2020 | | | 5,316 | | | 15,949(4) | | | 68.35 | | | 11/09/2030 | | | | | | | | | | | | | | | | 11/8/2021 | | | — | | | 20,803(4) | | | 71.13 | | | 11/08/2031 | | | | | | | | | | | | | | | | 11/11/2019 | | | | | | | | | | | | | | | 2,924(5) | | | 184,153 | | | | | | | | | | 11/9/2020 | | | | | | | | | | | | | | | 4,145(5) | | | 261,052 | | | | | | | | | | 11/8/2021 | | | | | | | | | | | | | | | 6,150(5) | | | 387,327 | | | | | | | | | | 11/11/2019 | | | | | | | | | | | | | | | 11,692(7)(8) | | | 736,362 | | | | | | | | | | 11/11/2019 | | | | | | | | | | | | | | | 7,951(7)(10) | | | 500,726 | | | | | | | | | | 11/11/2019 | | | | | | | | | | | | | | | 10,172(11)(12) | | | 640,633 | | | | | | | | | | 11/9/2020 | | | | | | | | | | | | | | | 8,290(7)(9) | | | 522,104 | | | | | | | | | | 11/9/2020 | | | | | | | | | | | | | | | 8,290(7)(12) | | | 522,104 | | | | | | | | | | 11/9/2020 | | | | | | | | | | | | | | | | | | | | | 8,290(10) | | | 522,104 | | | | 11/8/2021 | | | | | | | | | | | | | | | | | | | | | 8,200(8) | | | 516,436 | | | | 11/8/2021 | | | | | | | | | | | | | | | | | | | | | 8,200(13) | | | 516,436 | | | | 11/8/2021 | | | | | | | | | | | | | | | | | | | | | 8,200(10) | | | 516,436 | Kevin R. Thornal | | | 12/1/2017 | | | 12,490(4) | | | — | | | 40.85 | | | 12/01/2027 | | | | | | | | | | | | | | | | 11/12/2018 | | | 11,875 | | | 3,959(4) | | | 40.97 | | | 11/12/2028 | | | | | | | | | | | | | | | | 11/11/2019 | | | 9,050 | | | 9,052(4) | | | 45.61 | | | 11/11/2029 | | | | | | | | | | | | | | | | 11/9/2020 | | | 4,378 | | | 13,134(4) | | | 68.35 | | | 11/09/2030 | | | | | | | | | | | | | | | | 11/8/2021 | | | — | | | 20,803(4) | | | 71.13 | | | 11/08/2031 | | | | | | | | | | | | | | | | 11/11/2019 | | | | | | | | | | | | | | | 1,827(5) | | | 115,064 | | | | | | | | | | 11/9/2020 | | | | | | | | | | | | | | | 3,414(5) | | | 215,014 | | | | | | | | | | 11/8/2021 | | | | | | | | | | | | | | | 6,150(5) | | | 387,327 | | | | | | | | | | 11/11/2019 | | | | | | | | | | | | | | | 7,308(7)(8) | | | 460,258 | | | | | | | | | | 11/11/2019 | | | | | | | | | | | | | | | 4,969(7)(10) | | | 312,975 | | | | | | | | | | 11/11/2019 | | | | | | | | | | | | | | | 6,357(11)(12) | | | 400,364 | | | | | | | | | | 11/9/2020 | | | | | | | | | | | | | | | 6,826(7)(9) | | | 429,901 | | | | | | | | | | 11/9/2020 | | | | | | | | | | | | | | | 6,826(7)(12) | | | 429,901 | | | | | | | | | | 11/9/2020 | | | | | | | | | | | | | | | | | | | | | 6,826(10) | | | 429,901 | | | | 11/8/2021 | | | | | | | | | | | | | | | | | | | | | 8,200(8) | | | 516,436 | | | | 11/8/2021 | | | | | | | | | | | | | | | | | | | | | 8,200(13) | | | 516,436 | | | | 11/8/2021 | | | | | | | | | | | | | | | | | | | | | 8,200(10) | | | 516,436 |
TABLE OF CONTENTS HOLOGIC, INC. 2023 Proxy Statement
Jan Verstreken | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 2/1/2017 | | | 7,564(4) | | | — | | | 40.85 | | | 2/01/2027 | | | | | | | | | | | | | | | | 12/1/2017 | | | 12,490(4) | | | — | | | 40.85 | | | 12/01/2027 | | | | | | | | | | | | | | | | 11/12/2018 | | | 10,478 | | | 3,493(4) | | | 40.97 | | | 11/12/2028 | | | | | | | | | | | | | | | | 11/11/2019 | | | 7,693 | | | 7,694(4) | | | 45.61 | | | 11/11/2029 | | | | | | | | | | | | | | | | 7/1/2020 | | | 14,500 | | | 14,502(4) | | | 56.97 | | | 7/01/2030 | | | | | | | | | | | | | | | | 11/9/2020 | | | 3,127 | | | 9,382(4) | | | 68.35 | | | 11/09/2030 | | | | | | | | | | | | | | | | 11/8/2021 | | | — | | | 17,831(4) | | | 71.13 | | | 11/08/2031 | | | | | | | | | | | | | | | | 11/11/2019 | | | | | | | | | | | | | | | 1,553(5) | | | 97,808 | | | | | | | | | | 7/1/2020 | | | | | | | | | | | | | | | 2,926(5) | | | 184,279 | | | | | | | | | | 11/9/2020 | | | | | | | | | | | | | | | 2,438(5) | | | 153,545 | | | | | | | | | | 11/8/2021 | | | | | | | | | | | | | | | 5,272(5) | | | 332,031 | | | | | | | | | | 11/11/2019 | | | | | | | | | | | | | | | 6,212(7)(8) | | | 391,232 | | | | | | | | | | 11/11/2019 | | | | | | | | | | | | | | | 4,224(7)(10) | | | 266,038 | | | | | | | | | | 11/11/2019 | | | | | | | | | | | | | | | 5,404(11)(12) | | | 340,344 | | | | | | | | | | 11/9/2020 | | | | | | | | | | | | | | | 4,876(7)(9) | | | 307,090 | | | | | | | | | | 11/9/2020 | | | | | | | | | | | | | | | 4,876(7)(12) | | | 307,090 | | | | | | | | | | 11/9/2020 | | | | | | | | | | | | | | | | | | | | | 4,876(10) | | | 307,090 | | | | 11/8/2021 | | | | | | | | | | | | | | | | | | | | | 7,028(8) | | | 442,623 | | | | 11/8/2021 | | | | | | | | | | | | | | | | | | | | | 7,028(13) | | | 442,623 | | | | 11/8/2021 | | | | | | | | | | | | | | | | | | | | | 7,028(10) | | | 442,623 |
(1)
| Based upon the closingclose price of $64.35,$62.98, which was the closing market price on Nasdaq of our common stock on September 26, 2020,23, 2022, the last trading day of our common stock in fiscal 2020.2022. The market value of PSUs or RSUs that have not vested was determined by multiplying the closing market price by the number of PSUs or RSUs, respectively. |
(2)
| The number and value of the ROIC PSUs is based on achieving maximum performance, which is 200% of target. As of the end of fiscal 2022, all outstanding ROIC PSUs were trending at or above target performance. The number and value of the TSR PSUs is based on achieving maximum performance, which is 200% of target. As of the end of fiscal 2022, all outstanding TSR PSUs were trending at or above target performance. The number and value of the FCF PSUs is based on achieving maximum performance, which is 200% of target, as all such outstanding PSUs were trending, astarget. As of the end of fiscal 2020,2022, all outstanding FCF PSUs were trending at or above target performance. |
(3)
| These non-qualified stock options vestvested in five equal annual installments beginning on the first anniversary of the date of grant, subject to continued service on each applicable vesting date. |
(4)
| These non-qualified stock options vest in four equal annual installments beginning on the first anniversary of the date of grant, subject to continued service on each applicable vesting date. |
(5)
| These RSUs vest in three equal installments beginning of the first anniversary of the date of grant, subject to continued service on each applicable vesting date. |
(6)
| These matching RSUs, which were granted pursuant to Mr. MacMillan’s Employment Agreement, vest in one installment three years from the date of grant, subject to continued service on the vesting date. |
(7)
| The performance period for these ROIC PSUs, TSR PSUs and FCF PSUs ended at the end of the 2022 fiscal year or at the end of the 2021 fiscal year, with ROIC PSUs granted in fiscal 2020 and fiscal 2021 at 170%200% of target, TSR PSUs granted in fiscal 2020 at 141%136% of target and FCF PSUs granted in fiscal 2021 at 174%200% of target. The ROIC PSUs and TSR PSUs remained subject to continued service through December 1,granted in fiscal 2020 at which time they vested. The FCF PSUs remainremained subject to continued service through November 11, 2022, at which time they will vest.vested. The FCF PSUs granted in fiscal 2021 remain subject to continued service through November 9, 2023. The ROIC PSUs and FCF PSUs granted in fiscal 2022 remain subject to continued service through November 8, 2024. |
(8)
| These ROIC PSUs vest in one installment on the third anniversary of the grant date if the Company achieves a minimum three-year average ROIC threshold at the end of the three-year performance period, subject to continued service on the vesting date. |
(9)
| These ROIC PSUs vest in one installment on the third anniversary of the grant date if the Company achieves the minimum ROIC threshold at the end of the one-year performance period, subject to continued service on the vesting date. |
TABLE OF CONTENTS HOLOGIC, INC. 2023 Proxy Statement
(10)
| These TSR PSUs vest in one installment on the third anniversary of the grant date if the Company achieves the minimum total shareholder return target relative to a defined peer group at the end of the three-year performance period, subject to continued service on the vesting date. |
(10)(11)
| The performance period for these FCF PSUs granted in fiscal 2020 ended at the end of the 2020 fiscal year at 174% of target, subject to continued service through November 11, 2022, at which time they vested. |
(12)
| These FCF PSUs vest in one installment on the third anniversary of the grant date if the Company achieves the minimum adjusted free cash flow target at the end of the one-year performance period, subject to continued service on the vesting date. |
(13)
| | | | | | 71These FCF PSUs vest in one installment on the third anniversary of the grant date if the Company achieves the minimum adjusted free cash flow target at the end of the three-year performance period, subject to continued service on the vesting date.
|
TABLE OF CONTENTS
HOLOGIC, INC. 2021 Proxy Statement
Option Exercises and Stock Vested | Stephen P. MacMillan | | | 647,988 | | | 18,062,182 | | | 94,123(3) | | | 4,756,358 | | | Karleen M. Oberton | | | 36,809 | | | 1,237,075 | | | 5,912(4) | | | 289,027 | | | John M. Griffin | | | 24,530 | | | 490,464 | | | 14,397(5) | | | 724,342 | | | Kevin R. Thornal | | | 13,888 | | | 352,801 | | | 4,050 | | | 198,912 | | | Peter J. Valenti, III | | | 20,986 | | | 561,091 | | | 13,377 | | | 671,789 | |
Stephen P. MacMillan | | | — | | | — | | | 212,563 | | | 15,590,056 | Karleen M. Oberton | | | — | | | — | | | 33,162(3) | | | 2,430,567 | John M. Griffin | | | — | | | — | | | 34,718 | | | 2,545,719 | Kevin R. Thornal | | | — | | | — | | | 20,374 | | | 1,492,715 | Jan Verstreken | | | — | | | — | | | 20,558 | | | 1,497,667 |
(1)
| Value realized is calculated by subtracting the aggregate exercise price of the options from the aggregate market value of the shares of common stock acquired based on the closing price of our common stock on the date of exercise. |
(2)
| Value realized is calculated based on the number of shares vested multiplied by the closing price of our common stock on the date of vesting. This calculation does not account for shares withheld for tax purposes, but rather represents the gross value realized. |
(3)
| Includes 51,091 vested shares as to which settlement has been deferred to termination date or termination plus either 2, 5, 8, 10 or 15 years pursuant to the terms of the Company’s Amended and Restated Deferred Equity Plan. |
(4)
| Includes 4,401 vested shares as to which settlement has been deferred to termination date or termination plus either 2, 5, 8, 10 or 15 years pursuant to the terms of the Company’s Amended and Restated Deferred Equity Plan. |
(5)
| Consists of 5,73427,740 vested shares as to which settlement has been deferred to termination date or termination plus either 2, 5, 8, 10 or 15 years pursuant to the terms of the Company’s Amended and Restated Deferred Equity Plan. |
Non-Qualified Deferred Compensation | Stephen P. MacMillan | | | | | | — | | | 285,000 | | | 277,776 | | | — | | | 7,246,623(2) | | | | | | value of deferred equity | | | 2,633,233(3) | | | | | | | | | — | | | 69,476,961(4) | | | Karleen M. Oberton | | | | | | 87,442 | | | 260,000 | | | 148,989 | | | — | | | 2,297,529(2) | | | | | | value of deferred equity | | | 211,490(3) | | | | | | | | | — | | | 283,214(4) | | | John M. Griffin | | | | | | 66,000 | | | 175,000 | | | 257,576 | | | — | | | 2,359,953(2) | | | | | | value of deferred equity | | | 295,530(3) | | | | | | | | | — | | | 2,823,099(4) | | | Kevin R. Thornal | | | | | | — | | | 135,000 | | | 7,249 | | | | | | 421,504(2) | | | | | | value of deferred equity | | | | | | | | | | | | | | | — | | | Peter J. Valenti, III | | | | | | — | | | 335,000 | | | 33,294 | | | — | | | 1,172,110(2) | | | | | | value of deferred equity | | | — | | | | | | | | | — | | | 1,328,441(4) | |
Stephen P. MacMillan | | | | | | 41,324 | | | 432,500 | | | (2,003,881) | | | — | | | 8,310,161(2) | | | | value of deferred equity | | | — | | | | | | | | | — | | | 67,997,809(4) | Karleen M. Oberton | | | | | | 131,404 | | | 267,000 | | | (777,755) | | | — | | | 3,093,182(2) | | | | value of deferred equity | | | 2,040,003(3) | | | | | | | | | — | | | 2,589,813(4) | John M. Griffin | | | | | | — | | | 267,000 | | | (890,541) | | | — | | | 2,914,969(2) | | | | value of deferred equity | | | — | | | | | | | | | — | | | 2,942,866(4) | Kevin R. Thornal | | | | | | — | | | 225,000 | | | (235,743) | | | | | | 885,870(2) | | | | value of deferred equity | | | — | | | | | | | | | | | | — | Jan Verstreken(5) | | | | | | — | | | — | | | — | | | | | | — | | | | value of deferred equity | | | — | | | | | | | | | — | | | — |
(1)
| These contributions, which were made pursuant to our Non-Qualified Deferred Compensation Plan, were determined and funded in November 20192021 (fiscal 2020)2022). These amounts are included in the “All Other Compensation” column of the Summary Compensation Table. |
(2)
| The following amounts of the reported aggregate balance were previously reported as compensation to the NEOs and were included in the Summary Compensation Table for prior fiscal years: Mr. MacMillan: $1,500,000;$5,813,365; Ms. Oberton: $195,000;$1,251,316; Mr. Griffin: $730,000;$2,123,789; and Mr. Thornal: $80,000; and Mr. Valenti: $606,250.$465,000. |
(3)
| Reflects value, as of the vesting date, of equity which vested during fiscal 20202022 but settlement has been deferred pursuant to the Company’s Amended and Restated Deferred Equity Plan. |
(4)
| Reflects value, as of September 26, 2020,24, 2022, of cumulative equity which has vested but settlement has been deferred pursuant to the Company’s Amended and Restated Deferred Equity Plan. |
(5)
| This employee is a non-US employee and is not eligible to participate in the Company’s Non-Qualified Deferred Equity Plan. |
TABLE OF CONTENTS HOLOGIC, INC. 20212023 Proxy Statement
Potential Payments upon Termination or Change of Control The following table shows potential payments upon termination or a change of control for our NEOs. The terms and conditions of our employment, change of control and severance agreements with all of our NEOs are discussed below. Although our equity grant program provides for certain benefits upon an NEO’s retirement, none of our NEOs were eligible for such benefits assuming a resignation on September 26, 2020.24, 2022. | Stephen P. MacMillan
| | | | | | | | | | | | | | | Cash Severance | | | 13,069,015 | | | — | | | 8,741,816 | | | 7,649,089 | | | Share Awards(5) | | | 74,394,410 | | | — | | | — | | | 66,008,061 | | | Accelerated DCP(6) | | | 273,334 | | | — | | | — | | | 273,334 | | | Health/Welfare Benefits(7) | | | 35,132 | | | — | | | — | | | 35,132 | | | Total | | | 87,771,891 | | | — | | | 8,741,816 | | | 73,965,616 | | | Karleen M. Oberton
| | | | | | | | | | | | | | | Cash Severance | | | 3,513,250 | | | — | | | 979,167 | | | 1,850,000 | | | Share Awards(5) | | | 4,583,447 | | | — | | | — | | | 3,358,995 | | | Accelerated DCP(6) | | | 220,000 | | | — | | | — | | | 220,000 | | | Health/Welfare Benefits(7) | | | 1,042 | | | — | | | 1,042 | | | 3,125 | | | Total | | | 8,317,739 | | | — | | | 980,209 | | | 5,432,120 | | | John M. Griffin
| | | | | | | | | | | | | | | Cash Severance | | | 3,558,100 | | | — | | | 1,011,667 | | | 1,865,000 | | | Share Awards(5) | | | 5,829,979 | | | — | | | — | | | 4,584,356 | | | Accelerated DCP(6) | | | 166,667 | | | — | | | — | | | 166,667 | | | Health/Welfare Benefits(7) | | | 17,542 | | | — | | | 17,542 | | | 52,625 | | | Total
| | | 9,572,288 | | | — | | | 1,029,209 | | | 6,668,648 | | | Kevin R. Thornal
| | | | | | | | | | | | | | | Cash Severance | | | 3,363,750 | | | — | | | 880,667 | | | 1,800,000 | | | Share Awards(5) | | | 3,240,402 | | | — | | | — | | | 2,494,135 | | | Accelerated DCP(6) | | | 116,667 | | | — | | | — | | | 116,667 | | | Health/Welfare Benefits(7) | | | 18,885 | | | — | | | 18,885 | | | 56,655 | | | Total | | | 6,739,704 | | | — | | | 899,552 | | | 4,467,457 | | | Peter J. Valenti, III (8)
| | | | | | | | | | | | | | | Cash Severance | | | 1,350,000 | | | — | | | 675,000 | | | — | | | Share Awards(5) | | | 5,411,858 | | | — | | | — | | | 4,159,285 | | | Accelerated DCP(6) | | | 270,000 | | | — | | | — | | | 270,000 | | | Health/Welfare Benefits(7) | | | 17,542 | | | — | | | — | | | — | | | Total | | | 7,049,400 | | | — | | | 675,000 | | | 4,429,285 | |
Stephen P. MacMillan
| | | | | | | | | | | | | Cash Severance | | | 12,011,240 | | | — | | | 7,351,318 | | | 6,903,302 | Share Awards(5) | | | 28,687,916 | | | — | | | — | | | 22,263,598 | Accelerated DCP(6) | | | 399,551 | | | — | | | — | | | 399,551 | Health/Welfare Benefits(7) | | | 38,789 | | | — | | | — | | | 38,789 | Total | | | 41,137,496 | | | — | | | 7,351,318 | | | 29,605,240 | Karleen M. Oberton
| | | | | | | | | | | | | Cash Severance | | | 3,852,117 | | | — | | | 1,288,333 | | | 1,976,667 | Share Awards(5) | | | 5,390,923 | | | — | | | — | | | 4,128,216 | Accelerated DCP(6) | | | 286,333 | | | — | | | — | | | 286,333 | Health/Welfare Benefits(7) | | | 1,078 | | | — | | | 1,078 | | | 3,235 | Total | | | 9,530,451 | | | — | | | 1,289,411 | | | 6,394,451 | John M. Griffin
| | | | | | | | | | | | | Cash Severance | | | 3,687,667 | | | — | | | 1,233,333 | | | 1,906,667 | Share Awards(5) | | | 4,940,292 | | | — | | | — | | | 3,818,898 | Accelerated DCP(6) | | | 278,000 | | | — | | | — | | | 278,000 | Health/Welfare Benefits(7) | | | 19,370 | | | — | | | 19,370 | | | 58,109 | Total | | | 8,925,329 | | | — | | | 1,252,703 | | | 6,061,674 | Kevin R. Thornal
| | | | | | | | | | | | | Cash Severance | | | 3,709,469 | | | — | | | 1,240,625 | | | 1,906,250 | Share Awards(5) | | | 3,744,707 | | | — | | | — | | | 2,740,841 | Accelerated DCP(6) | | | 233,333 | | | — | | | — | | | 233,333 | Health/Welfare Benefits(7) | | | 20,653 | | | — | | | 20,653 | | | 61,958 | Total | | | 7,708,162 | | | — | | | 1,261,278 | | | 4,942,382 | Jan Verstreken(9)
| | | | | | | | | | | | | Cash Severance | | | 3,031,344 | | | — | | | 2,027,656 | | | — | Share Awards(5) | | | 3,298,917 | | | — | | | — | | | — | Allowances(8) | | | — | | | — | | | 108,389 | | | — | Health/Welfare Benefits(7) | | | — | | | — | | | 43,815 | | | — | Total | | | 6,330,261 | | | — | | | 2,179,860 | | | — |
(1)
| Benefits and payments calculated assuming the executive’s employment was terminated by us without cause or by the executive for good reason on September 26, 202024, 2022 following a change of control and payable as a lump sum. For purposes of these amounts, the prior fiscal year is fiscal 2022. |
(2)
| Benefits and payments calculated assuming the executive’s employment was terminated voluntarily or by us for cause on September 26, 202024, 2022 and payable as a lump sum. |
(3)
| Benefits and payments calculated assuming the executive’s employment was terminated by us without cause or by the executive for good reason on September 26, 202024, 2022 and payable as a lump sum. For purposes of calculating these amounts, the prior fiscal year as used in the employment agreement and change in control agreements is fiscal 2022. |
TABLE OF CONTENTS HOLOGIC, INC. 2023 Proxy Statement
(4)
| Benefits and payments calculated assuming the executive’s employment was terminated as a result of executive’s death or disability on September 26, 202024, 2022 and payable in a lump sum. For purposes of the cash severance and health and welfare benefits, the payments and benefits also assume that a change of control occurred on September 26, 2020,24, 2022, and such amounts would not be payable upon a termination as a result of death or disability prior to, or more than three years following, a change of control. |
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HOLOGIC, INC. 2021 Proxy Statement
(5)
| Assumes a change of control price of $64.35,$62.98, which was the closing market price on Nasdaq of our common stock on September 25, 2020,23, 2022, the last trading day for our common stock in fiscal 2020. 2022. For PSU awards with a performance period ending as of fiscal 2022 (or earlier) that remained unvested as of September 24, 2022, such PSUs are included based on actual performance, and all other PSU awards that remained unvested as of September 24, 2022 are included based on target performance. |
(6)
| Under the terms of our DCP, employer contributions to the DCP are fully vested in the event of (i) the executive’s death, disability or a change of control or (i) the executive’s retirement after the attainment of certain age and/or service milestones. |
(7)
| Includes medical and dental benefits assuming the rates and coverage elections in effect as of the end of fiscal 20202022 remain in effect throughout the applicable period. |
(8)
| Includes housing and automotive allowances during fiscal 2022. |
(9)
| The Company converted Mr. Valenti retired on December 31, 2020 and received certain benefits and payments pursuantVerstreken’s compensation in UK Pound to U.S. Dollar using the terms of his Retirement and Separation Agreement, as described below under “Retirement Agreement with Mr. Valenti.”average exchange rate for the fiscal year. |
Change of Control and Severance Agreements The Company has entered into change of control agreements and/or severance agreements with certain of its senior executive officers, including our NEOs. Mr. MacMillan As described in the CD&A, theThe Company has entered into an employment agreement with Mr. MacMillan.MacMillan in 2015, which was amended in 2016 and October 2020. Under the employment agreement, the Committee or the independent members of the Board have discretion to determine Mr. MacMillan’s base salary, target STIP opportunity, Company contribution under the DCP and annual equity grant values. The Employment Agreement also provides for the payment of severance in certain circumstances. Specifically, if, during the term of the Employment Agreement, Mr. MacMillan’s employment is terminated by the Company without cause or if Mr. MacMillan terminates his employment for good reason (as such terms are defined in the Employment Agreement), then he will be entitled to: (i) a payment equal to his accrued compensation through the termination date, which includes pro-rated base salary, reimbursement for business expenses, vacation pay, his annual bonus for the fiscal year prior to the year in which the termination occurs if not paid prior to his termination date, and any vested and/or earned amounts or benefits under the Company’s employee benefit plans, programs, policies or practices; (ii) continued payment of a cash severance amount in equal payments over a two-year severance period in a total amount equal to two times the sum of his annual base salary plus his annual cash bonus for the prior fiscal year; and (iii) payment of a cash severance in the amount of Mr. MacMillan’s annual cash bonus for the fiscal year in which such termination occurs, pro-rated for the then current fiscal year and payable no later than the thirtieth of November following the end of the applicable fiscal year in which the award was earned. If, following a Notice of Non-Renewal by either Mr. MacMillan or the Company and at or after the expiration of the term, Mr. MacMillan’s employment is terminated by the Company without cause or if Mr. MacMillan terminates his employment for good reason, then he will be entitled to the compensation described above, except that the severance period and amount shall be for one year rather than two. In each case, receipt of any severance payments or benefits is conditioned upon Mr. MacMillan’s release of all claims against the Company and its officers and directors.
The Company also entered into a Change of Control Agreement with Mr. MacMillan upon his joining the Company in December 2013. In the event that Mr. MacMillan receives benefits as the result of a change of control, such benefits will be in lieu of any of the severance benefits provided for in his Employment Agreement. Change of ControlControl. . Mr. MacMillan’s Change of Control Agreement provides that in the event of a change of control during the term of the agreement, if, in anticipation of or within the three-year period following the change of control (the Employment Period), his employment is terminated for reasons other than death, disability or cause, or he resigns for good reason, he is entitled to certain benefits (a double-trigger arrangement). In such circumstances, he shall have the right to receive (i) a lump sum cash payment equal to his accrued and unpaid compensation through the date of his termination; (ii) a pro-rata highest annual bonus (as defined below) based on the number of days elapsed during the fiscal year through the date of termination; (iii) a lump sum cash payment equal to the product of 2.99 times the sum of his annual base salary for the fiscal year preceding the date of termination and highest annual bonus; and (iv) immediate and full vesting of all stock options, RSUs, PSUs and other equity awards, with any options (or other similar awards) remaining exercisable for the shorter of the remaining term of the award or a period of one year following the executive’s termination. The term “highest annual bonus” is defined as the greater of (i) the average of annual bonuses paid to the executive over the three fiscal years preceding the fiscal year in which the change of control occurs; (ii) the annual bonus paid to the executive in the fiscal year preceding the fiscal year in which the change of control occurs; or (iii) the target bonus award TABLE OF CONTENTS HOLOGIC, INC. 2023 Proxy Statement
opportunity associated with the Company achieving its 100% target payout level as determined in accordance with the Company’s bonus plan for the fiscal year preceding the fiscal year in which the change of control occurs. Mr. MacMillan will continue to receive health and dental benefits for the remaining term of the Employment Period. Mr. MacMillan’s Change of Control Agreement does not provide for any change of control benefits, including the acceleration of equity awards, if he remains employed by the Company, is terminated by the Company for cause or voluntarily terminates his employment (other than a resignation for good reason). If Mr. MacMillan dies or his employment is terminated by reason of disability during the Employment Period, then he, or his heirs or estate, is entitled to receive (i) a lump sum cash payment equal to all accrued and unpaid compensation through the TABLE OF CONTENTS
HOLOGIC, INC. 2021 Proxy Statement
date of termination (or death) plus a pro-rata highest annual bonus based on the number of days elapsed during the fiscal year through the date of termination (or death); (ii) continuation of certain welfare benefits for the remaining term of the Employment Period; and (iii) a lump sum cash payment equal to the sum of his annual base salary and the highest annual bonus. In the event any payments and benefits provided under the Change of Control Agreement is subject to excise taxes under Section 280G of the Internal Revenue Code, of 1986, as amended (the Code), then the payment shall be reduced so that no payment to be made or benefit to be provided to the executive shall be subject to the excise tax. Ms. Oberton and Messrs. Griffin and Thornal The Company has entered into a Severance and Change of Control Agreement with each of Ms. Oberton and Messrs. Griffin and Thornal. Severance.Each agreement provides that if the executive is terminated by the Company without cause or resigns for good reason, then the executive is entitled to receive certain benefits, including (i) a lump sum cash payment equal to the executive’s accrued and unpaid compensation through the termination date, which includes base salary, reimbursement for reasonable and necessary business expenses and vacation pay; (ii) a pro-rated bonus for the year in which the executive was terminated; (iii) for one-year from the date of termination, continuation of the executive’s previous year’s salary and payment of an amount equal to the executive’s average annual bonus divided by the number of payroll periods during such one-year severance period; and (iv) a one-year continuation of the executive’s medical and dental benefits. The severance pay and benefits provided under the Severance and Change of Control Agreements are in lieu of any other severance or termination pay to which the executive may be entitled under any other severance or termination plans, programs or arrangements. In the event that the executive receives benefits as the result of a change of control, then the executive will receive such change of control benefits in lieu of any of the severance benefits. Change of Control.Terms relating to benefits payable in connection with termination shortly before or within three years of a change of control are identical to those described above for Mr. MacMillan except that Ms. Oberton and Messrs. Griffin and Thornal shall continue to receive health and dental benefits for a period of one year following the executive’s termination. Terms relating to benefits payable in connection with executive’s death or disability shortly before or within three years of a change of control are identical to those described above for Mr. MacMillian.MacMillan. In the event any payments and benefits provided under the Severance and Change of Control Agreements are subject to excise taxes under Section 280G of the Code, then the payment shall be reduced so that no payment to be made or benefit to be provided to the executive shall be subject to the excise tax. Prior to his retirement, theThe Company hadhas entered into a Severance Agreement as well as a Change of Control Agreementan employment agreement with Mr. Valenti.Verstreken, which was amended and restated in December 2020.
SeveranceSeverance. . The Severance AgreementMr. Verstreken’s agreement provides that if the executivehe is terminated by the Company without cause or resigns for good reason,other than in connection with a change in control, then he is entitled to receive certain benefits,24 months of total compensation, including (i) a lump sum cash payment equal to his accrued compensation through the termination date, which includes base salary, reimbursement for reasonable and necessary business expenses and vacation pay; (ii) a pro-ratedpay, bonus, for the year in which he was terminated (based on the average of the bonuses paid for the prior three fiscal years); and (iii) a 15-month continuation of his annual base salary. In the event any paymentsallowances and benefits provided under the Severance Agreement are subject to excise taxes under Section 280G of the Code, then the payment shall be reduced so that no payment to be made or benefit to be provided to the executive shall be subject to the excise tax.(or cash equivalent).
The severance pay and benefits provided under the Severance Agreement are in lieu of any other severance or termination pay to which the executive may be entitled under any of our other severance or termination plans, programs or arrangements. In the event that the executive receives benefits as the result of a change of control, then the executive will receive such change of control benefits in lieu of any of the severance benefits.
Change of Control. The Change of Control Agreement provides that inIn the event ofsuch termination occurs on or within three years following a change ofin control, and during the two-year period following the consummation of such change of control, if the executive’s employment is terminated for reasons other than death, disability or cause, or if he resigns for good reason (a double-trigger arrangement), then he shall be entitled to receive (i) a lump sum cash payment equal to his accrued compensation through the termination date, which includes base salary, reimbursement for reasonable and necessary business expenses and vacation pay; (ii) a prorated average annual bonusMr. Verstreken’s agreement provides for the year in which he was terminated; (iii)following benefits: (i) accrued obligations (including a lump sum payment equal to the sum of hispro-rated bonus), (ii) 2.99x annual base salary, (iii) 2.99x bonus, and average annual bonus; (iv) immediate and full vesting of all stock options, RSUs, PSUs and other equity awards; and (v) continued health and dental benefits for a period of one year following termination.equity. TABLE OF CONTENTS
HOLOGIC, INC. 2021 Proxy Statement
The Company’s equity compensation program, including each NEO’s awards, provides for additional benefits upon certain terminations of employment, in addition to those equity award benefits provided under the Change of Control and Severance Agreements described above. TABLE OF CONTENTS HOLOGIC, INC. 2023 Proxy Statement
Retirement. UponFor all of our NEOs, other than Mr. Verstreken, upon an NEO’s retirement, the equity award agreements provide for the continued vesting of RSUs and stock options and pro-rata vesting of PSUs, if the individual is either 65 years of age or older, or at least 55 years of age with 10ten years of continuous service with the Company. While RSUs and stock options continue to vest on their original vesting schedule following retirement, PSUs granted prior to fiscal 2021 vest on their original vesting date on a pro-rata basis (based on number of days employed during the applicable performance period) based on actual performance during the performance period (assuming threshold performance is achieved). If threshold performance is not achieved during the applicable performance period, no PSUs will vest. Beginning with the PSUs granted in fiscal 2021, upon an executive’s retirement, PSUs vest on their original vesting date without application of any pro-ration. If threshold performance is not achieved during the applicable performance period, no PSUs will vest. Death or Disability.Upon an NEO’s termination as a result of his or her death or permanent disability, the equity award agreements provide for full acceleration of all stock options and RSUs and acceleration of a pro-rata amount of the target PSUs. The amount of the estimated payments and benefits payable to NEOs, assuming a change of control of the Company or termination of employment as of the last day of fiscal 2020,2022, is shown in the table on page 7379 under the heading “Potential Payments upon Termination or Change of Control.” Retirement Agreement with Mr. ValentiIn connection with his retirement, the Company and Mr. Valenti entered into a Retirement and Separation Agreement on August 25, 2020. Under the terms of the Retirement and Separation Agreement, until December 31, 2020 (the Retirement Date), Mr. Valenti (i) continued to receive his base salary; and (ii) was entitled to continue to participate in any and all retirement, medical, dental, life insurance and other employee benefit plans in which he participated as of the date of the Retirement and Separation Agreement.
Following the Retirement Date and upon Mr. Valenti’s execution and non-revocation of a general release of all claims in favor of the Company, Mr. Valenti received the following benefits, which correspond to the severance benefits he otherwise would have been entitled to receive under his existing Severance Agreement described above:
Continued payment of his base salary for 15 months following the Retirement Date ($675,000);
Payment equal to the average of his annual bonus paid for the prior three fiscal years, pro-rated for the time worked in fiscal 2021 through the Retirement Date, payable in a lump sum ($144,452); and
Cash payment in lieu of health benefit continuation for 12 months following the Retirement Date, payable in a lump sum ($27,107.64).
Pursuant to the Retirement and Separation Agreement, Mr. Valenti’s outstanding equity awards will remain outstanding and continue to vest and be exercisable subject to and in accordance with their respective terms as if Mr. Valenti were “retirement eligible” under the existing terms of the applicable award agreements, except that the performance share units, to the extent earned, will not be subject to pro-ration. In addition, Mr. Valenti’s outstanding unvested balance under our DCP vested in full on the Retirement Date. The Retirement and Separation Agreement provides that Mr. Valenti’s existing non-competition agreement will remain in full force and effect in accordance with its existing terms.
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HOLOGIC, INC. 2021 Proxy Statement
Our philosophy is to pay our employees competitively compared to similar positions in the applicable labor market. We follow that approach worldwide, whether for an executive position or an hourly job at a local facility. We take into account location, job level, time with us and time in current role, experience and skill set, and adjust compensation annually to match the applicable market. By doing so, we believe we maintain a high-quality, stable workforce. Under rules adopted pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act and Item 402(u) of Regulation S-K, we are required to calculate and disclose the total compensation paid to our median employee, as well as the ratio of the total compensation paid to the median employee as compared to the total compensation paid to our CEO. The pay ratio is a reasonable estimate calculated in a manner consistent with SEC rules based on our payroll and employment records and the methodology described below. For 2020,2022, our last completed fiscal year: the annual total compensation of the employee identified at median of our Company (other than our CEO), was $84,375;$89,257; the annual total compensation of our CEO was $14,125,674.• | the annual total compensation of our CEO was $14,335,632, as detailed in the Summary Compensation Table on page 72. |
Based on this information, for 2020,fiscal 2022, the ratio of the annual total compensation of our CEO to the median of the annual total compensation of all employees (other than our CEO) was estimated to be approximately 167161 to 1. The pay ratio is a reasonable estimate calculated in a manner consistent with SEC rules based on our payroll and employment records and the methodology described below. 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. Accordingly, the pay ratio reported by other companies may not be comparable to the pay ratio reported by us, as other companies may have different employment and compensation practices and may utilize different methodologies, exclusions, estimates and assumptions in calculating their pay ratios.
For fiscal 20202022, and as permitted under Item 402(u) of Regulation S-K, we utilized the same “median employee” established based on the annual base salary as of August 1, 2018September 25, 2021 and fiscal 20182021 bonuses/commissions for all employees employed on August 1, 2018,September 25, 2021, which included all employees on our payroll and did not exclude any countries. During fiscal 2020,2022, we do not believe that any changes to our employee population or employee compensation would result in a significant change to our pay ratio. We calculated the compensation of the median employee for fiscal 20202022 in accordance with the requirements of Item 402(c)(2) of Regulation S-K. TABLE OF CONTENTS HOLOGIC, INC. 20212023 Proxy Statement
Proposal No. 3 – Non-Binding Advisory Vote on the Frequency of Future Advisory Votes to Approve Executive Compensation In addition to providing stockholders with the opportunity to cast an advisory vote to approve executive compensation, Section 14A of the Exchange Act also enables our stockholders to indicate how frequently we should seek an advisory vote on the compensation of our named executive officers, as disclosed pursuant to the SEC’s compensation disclosure rules, and as described in Proposal No. 2 included on page 39 of this proxy statement. By voting on this Proposal No. 3, stockholders may indicate whether they would prefer an advisory vote on named executive officer compensation once every one, two, or three years. After consideration of this proposal, our Board has determined that an advisory vote on executive compensation that occurs every year is the most appropriate alternative for the Company, and therefore, our Board recommends that you vote for a one-year interval for the advisory vote on executive compensation. Our stockholders voted on a similar proposal at our 2017 Annual Meeting of Stockholders with the majority voting to hold the advisory vote on executive compensation every year. In formulating its recommendation, our Board considered that an annual advisory vote on executive compensation will allow our stockholders to provide us with their input on our compensation of named executive officers as disclosed in the proxy statement every year. We understand that our stockholders may have different views as to the best approach for the Company, and we look forward to hearing from our stockholders on this proposal. You may cast your vote on your preferred voting frequency by choosing the option of one year, two years, three years or you may abstain from voting when you vote in response to this proposal. Because your vote is advisory, it will not be binding upon the Company, the Compensation Committee or our Board. However, the Company values the opinions expressed by stockholders in their vote on this proposal, and the Compensation Committee will review the voting results and take into account stockholders’ views in determining the frequency of future advisory votes to approve executive compensation. Vote Required The option of one year, two years or three years that receives the highest number of votes cast by stockholders will be the frequency for the advisory vote on executive compensation that has been selected by stockholders. Abstentions and broker “non-votes” will not have any effect on the proposal regarding the frequency of an advisory vote on executive compensation. Recommendation of the Board | | | Our Board of Directors unanimously recommends that you vote for conducting advisory votes to approve executive compensation every “ONE YEAR”. Management proxy holders will vote all duly submitted proxies FOR conducting annual advisory votes unless instructed otherwise. |
TABLE OF CONTENTS HOLOGIC, INC. 2023 Proxy Statement
Proposal No. 3 -4 – Approve the Hologic, Inc. Amended and Restated 2008 Equity Incentive PlanSummary of the Proposal Effective March 11, 2008 we adopted the Hologic, Inc. 2008 Equity Incentive Plan (the “2008 Equity Incentive Plan”). Effective March 11, 2013, stockholders approved an amendment and restatement of the 2008 Equity Incentive Plan and effective March 14, 2018, stockholders approved a further amendment and restatement of the 2008 Equity Incentive Plan (the “Current A&R Plan”). On December 8, 2022, our Board, subject to stockholder approval at the Annual Meeting, approved a further amendment and restatement of the Current A&R Plan (the “Proposed A&R Plan”). The Proposed A&R Plan, which is attached as Annex B to this proxy statement (marked to show proposed amendments), would, among other things: increase the number of shares of common stock available for grant under the plan by 6,500,000 shares; and extend the term through March 9, 2033 The above is not a comprehensive list of the changes, some of which are described in more detail below. For further and complete information on the terms of the Proposed A&R Plan, please see the full text of the Proposed A&R Plan in Annex B. Our Compensation Committee and our Board believe that our future success depends, in large part, upon our ability to maintain a competitive position in attracting, retaining and motivating key personnel. We also believe that our ability to do so depends on being able to offer key personnel competitive compensation. Equity is a key component of our compensation program. Hologic grants equity awards to key employees, consultants and non-employee directors to achieve our strategic objectives by: providing motivation to achieve the Company’s financial goals; promoting retention through the use of multi-year vesting schedules; encouraging loyalty; fostering alignment with the interests of Hologic stockholders; and providing incentives that are competitive with those of companies with which Hologic competes for talent. As of September 24, 2022, a total of 3,345,813 shares remained available for future awards under the Current A&R Plan. Material Amendments The material differences between the Current A&R Plan and the Proposed A&R Plan are described below, and such descriptions are qualified in their entirety by the text of the Proposed A&R Plan, which is attached as Annex B to this proxy statement. The list below does not cover all of the updates or revisions to the Current A&R Plan, including certain clarifications and ministerial changes. For further and complete information on the terms of the Proposed A&R Plan, we encourage you to refer to the text of the Proposed A&R Plan. Capitalized words used but not defined in this section have the meaning ascribed to them in the Proposed A&R Plan. Increase in Share Reserve. Upon adoption, the maximum aggregate number of shares of our common stock authorized for issuance under the Proposed A&R Plan would be 42,500,000, reflecting an increase of 6,500,000 shares authorized for issuance as compared to the Current A&R Plan. Assuming that aggregate equity awards are granted at levels consistent with recent historical practices, then we generally expect that the share reserve under the Proposed A&R Plan should be sufficient to cover our Company’s projected stock grants for a period of approximately four to five years, including our Company’s annual equity grants that are expected to be made in November 2023. Term. The term of the Proposed A&R Plan would expire on March 9, 2033, unless extended by stockholder approval in the future. TABLE OF CONTENTS HOLOGIC, INC. 2023 Proxy Statement
Key Data When approving the Proposed A&R Plan, our Compensation Committee considered the burn rate with respect to the equity awards granted by the Company, as well as our overhang. Our burn rate is equal to the total number of equity awards our Company granted in a fiscal year divided by the weighted average number of shares of common stock outstanding during the year. Overhang is equal to the total number of equity awards outstanding plus the total number of shares available for grant under our equity plans, divided by the sum of the total common stock outstanding, the number of equity awards outstanding and the total number of shares available for grant under our Company’s equity plans. Our share burn rate for the past three fiscal years was approximately 0.68%, which is comparable to the median three-year average share burn rate of 0.52% for our peer group (described in more detail on pages 68 and 69). Our overhang as of September 24, 2022 was 4.11%, which was significantly less than the median overhang of our peer group of 8.9%. If the Proposed A&R Plan is approved, our overhang would increase to 6.6%, which is still significantly less than that of the median of the peer group. The following table sets forth information regarding outstanding equity awards and shares available for future equity awards under the Current A&R Plan as of September 24, 2022 (without giving effect to approval of the Proposed A&R Plan): Total shares underlying outstanding stock options | | | 4,334,709 | Weighted average exercise price of outstanding stock options | | | $48.46 | Weighted average remaining contractual life of outstanding stock options | | | 6.14 | Total shares underlying outstanding unvested or deferred time-based restricted stock unit awards | | | 1,488,514 | Total shares underlying outstanding unearned or deferred performance-based restricted stock unit awards | | | 1,432,455 | Total shares currently available for grant under Current A&R Plan | | | 3,345,813 | Total shares of common stock outstanding as of September 24, 2022 | | | 247,132,687 |
On the Record Date, the market price of our common stock, the class of stock underlying all awards subject to the Current A&R Plan, was $81.08 per share as reported on the Nasdaq Global Select Market. Promotion of Good Corporate Governance Practices The Proposed A&R Plan, similar to the Current A&R Plan generally provides for the following (subject to exceptions as specified in and qualified in its entirety by the Proposed A&R Plan document in Annex B): incentive stock options may not have a term in excess of ten years, may not be repriced without stockholder approval, and may not be granted at a discount to the fair market value of our common stock on the grant date; annual limit on equity and cash compensation that may be awarded to non-employee directors; one-year minimum vesting period for all equity-based awards; in no event will dividends or dividend equivalents be paid during the service or performance period with respect to unvested time-based or unearned performance-based awards; awards are subject to any recovery, recoupment, or similar “clawback” policy maintained by our Company; no liberal share recycling for full-value awards; and annual limit on the number of shares underlying awards and the maximum cash amount under incentive awards granted to an individual. Summary of the Proposed A&R Plan The following summary of the material terms of the Proposed A&R Plan is qualified in its entirety by reference to the complete text of the Proposed A&R Plan, which is set forth in Annex B to this proxy statement. Stockholders are encouraged to read the text of the Proposed A&R Plan in its entirety. Purpose. The purpose of the Proposed A&R Plan is to attract and retain employees and directors, to provide an incentive for them to assist us in achieving our long-range performance goals, and to enable them to participate in our long-term growth. Effective Date. The Proposed A&R Plan will become effective on the date of our Annual Meeting of Stockholders, if it is approved by our stockholders. TABLE OF CONTENTS HOLOGIC, INC. 2023 Proxy Statement
Term. The term of the Proposed A&R Plan expires on the tenth anniversary of its effective date; provided, however, that incentive stock options may not be awarded under the Proposed A&R Plan after December 8, 2032. Securities to be Offered and Eligible Participants. The Proposed A&R Plan provides for the issuance of a maximum of 42,500,000 shares pursuant to the grant of options (“Options”); restricted stock awards; and other awards, including, without limitation, restricted stock units (“RSUs”), deferred shares, performance shares, stock units, stock appreciation rights and stock or phantom stock awards (collectively, “Stock Based Awards”) to our and our subsidiaries’ and parents’ employees, consultants, directors, executive officers and any other persons who our Board has determined to have made (or is expected to make) contributions to our Company. All of our employees, executive officers and non-employee directors are eligible to participate in the Proposed A&R Plan; as of September 24, 2022, we had 6,944 full-time employees and seven non-employee directors. The shares of our common stock available for issuance under the Proposed A&R Plan are subject to adjustment for any stock dividend, recapitalization, stock split, stock combination or certain other corporate reorganizations. Adjustments do not have to be uniform as between different awards or different types of awards. If, (i) an award granted under the Proposed A&R Plan is canceled, expires, forfeited, settled in cash, settled by delivery of fewer shares of common stock than the number of shares of common stock underlying the award or otherwise terminated without delivery of the shares of common stock to the holder of such award, or (ii) other than in the case of an Option Award or a stock appreciation right award, shares are withheld from such an award or separately surrendered by a participant in payment of taxes relating to such an award, such shares or shares underlying such award shall be deemed to constitute shares not delivered and will be available under the Proposed A&R Plan for subsequent awards. Shares of common stock subject to an Award under the Proposed A&R Plan may not again be made available for issuance under the plan if such shares are: (A) shares that were subject to a stock-settled stock appreciation right and were not issued upon the net settlement or net exercise of such stock appreciation right, (B) shares delivered to or withheld by the Company to pay the exercise price of an Option Award, (C) shares delivered to or withheld by the Company to pay the withholding taxes related an Option Award or a stock appreciation right, or (D) shares repurchased on the open market with the proceeds of an Option Award. Shares issued pursuant to awards under the Proposed A&R Plan may be authorized and unissued shares or shares that we reacquired including in the open market. The aggregate number of shares issued under the Proposed A&R Plan at any time may only equal the number of shares actually issued upon exercise or settlement of an award under the Proposed A&R Plan. Subject to adjustments for changes in our capitalization, the aggregate number of shares that may be earned pursuant to awards granted under the Proposed A&R Plan during any calendar year to any one participant will not exceed 3,000,000; and the aggregate number of shares that may be issued pursuant to the exercise of incentive stock options will not exceed 42,500,000. The maximum cash amount payable pursuant to all incentive awards granted in any calendar year to any participant under the plan that are intended to be performance based compensation shall not exceed $10,000,000. Under the Proposed A&R Plan, the aggregate dollar value of equity-based (based on the grant date fair value of equity-based awards) and cash compensation granted under the Proposed A&R Plan or otherwise to any one non-employee director during any fiscal year will not exceed $800,000, with 150% of such limit to be permitted for a non-employee director in the fiscal year he or she first joins our Board or is first designated as Chairman of our Board or Lead Director. Administration. The Proposed A&R Plan is administered by our Board. Our Board may, to the extent permitted by applicable law, delegate any or all of its powers under and/or day-to-day administration of the Proposed A&R Plan to a committee or subcommittee of our Board (or other employee or agent, as applicable). The Proposed A&R Plan is currently administered by the Compensation Committee of our Board. Options. Subject to the provisions of the Proposed A&R Plan, our Board may award options and has the authority to select the optionees and determine the terms of the options granted, including: (i) the number of shares subject to each option, (ii) when the option becomes exercisable, (iii) the exercise price of the option, (iv) the duration of the option and (v) the time, manner and form of payment upon exercise of an option. As provided under the Proposed A&R Plan, the number of shares of our common stock underlying a stock option and the exercise price thereof will continue to adjust when we effect a stock split, stock dividend, merger or similar event. The exercise price per share for each option, including both incentive stock options (“ISOs”) and nonqualified stock options (“NQSOs”), to be granted under the Proposed A&R Plan may not be less than the fair market value per share of our common stock on the date of such grant (with an exception for options that are a substitute award for options held by optionees of an acquired entity). In the case of an ISO to be granted to an employee owning stock possessing more than 10% of the total combined voting power of all classes of our stock, the price per share for such ISO shall not be less than 110% of the fair market value per share of our common stock on the date of grant. In no event may our Board amend an outstanding option agreement to reduce the exercise price or otherwise re-price or institute an option exchange program, or if the exercise price of an option is above the fair market value per share of our common stock, take action to cancel and re-grant or exchange an outstanding option for cash or another award, unless such action is approved by our stockholders. TABLE OF CONTENTS HOLOGIC, INC. 2023 Proxy Statement
Each option granted will expire on the date specified by our Board, but not more than (i) 10 years from the date of grant in the case of ISOs and (ii) five years from the date of grant in the case of ISOs granted to an employee owning stock possessing more than 10% of the total combined voting power of all classes of our stock. Restricted Stock Awards. Subject to the provisions of the Proposed A&R Plan, our Board may grant shares of restricted stock to participants with such restricted periods and other conditions as our Board may determine and for no cash consideration or such other consideration as may be required by applicable law or by our Board. Our Board determines the exercise price per share for purchases under the Proposed A&R Plan. Unless determined otherwise by our Board, participants in whose name restricted stock awards are granted will be entitled to receive all dividends and other distributions paid with respect to those shares. Notwithstanding the foregoing, dividends credited/payable in connection with restricted stock awards that are not yet vested will be subject to the same restrictions and risk of forfeiture as the underlying restricted stock awards and will not be paid until the underlying restricted stock awards vest. Other Stock Based Awards. Subject to the provisions of the Proposed A&R Plan, our Board may award stock awards, which may be designated as award shares based upon certain conditions, securities convertible into our common stock, stock appreciation rights (subject to the same terms as options, as applicable), phantom stock awards, performance stock, deferred stock, RSUs, shares of our common stock not subject to any restrictions, other stock units, or other awards. Our Board determines the exercise price per share for awards under the Proposed A&R Plan. Prior to settlement or forfeiture, an RSU or other stock unit agreement may, at our Board’s discretion, provide a right to dividend equivalents; provided such dividend equivalents will be subject to the same restrictions and risk of forfeiture as, and will not be paid until the vesting of, their underlying awards. No other form of award under the Proposed A&R Plan will give rise to dividend rights, voting rights, or other rights as a shareholder with respect to any shares of common stock covered by a participant’s award prior to the issuance of such shares. Performance and Incentive Awards. Subject to the provisions of the Proposed A&R Plan, our Board may grant awards, including cash bonuses, under the Proposed A&R Plan that are subject to such performance conditions as may be specified by the Board. The Board may use such business criteria and other measures of performance as it may deem appropriate in establishing any performance conditions and may exercise its discretion to reduce the amounts payable under any incentive award subject to performance conditions. The Committee may establish performance goals that are measured either individually, alternatively or in any combination, applied to either the Company as a whole or to a specified subsidiary or business unit, and measured over a performance period, on an absolute basis or relative to a pre-established target to a previous year’s result or to a designated comparison group, either based on United States Generally Accepted Accounting Principles (“GAAP”) or non-GAAP financial results, in each case as specified by the Committee in the Award. The business criteria that the Committee may use in establishing performance goals for such an Award include, among others: economic value added; earnings before interest, taxes, depreciation and amortization; earnings before interest and taxes; cash flow; earnings per share; operating income; operating income before income taxes; net income; net income before income taxes; operating margin; ratio of debt to stockholder’s equity; reduction of debt, return on equity; return on assets; return on invested capital; revenue; total shareholder return; market penetration; total market capitalization and enterprise value; business retention; new product generation; cost controls and targets (including costs of capital); customer satisfaction; employee satisfaction; agency ratings; management of employment practices and employee benefits; supervision of litigation and information technology; implementation of business process controls; recruiting and retaining personnel; geographical expansion; clinical and product developments; or regulatory milestones. For the avoidance of doubt, the performance goals associated with the business criteria can be measured on an absolute basis or relative to a group of companies, entities, or other forms of external benchmarks. A “performance period” shall be a calendar year, fiscal year of the Company or other longer or shorter period designated by the Compensation Committee. Minimum Vesting Requirement. Equity-based awards granted under the Proposed A&R Plan may not become exercisable, vest, or be settled, in whole or in part, prior to the one-year anniversary of the date of the grant, except that: (i) our Board may provide that awards become exercisable, vest or settle prior to such date in the event of a participant’s death or disability or in the event of a change of control (as defined in the Proposed A&R Plan); and (ii) annual equity grants to non-employee directors that occur in connection with our Company’s Annual Meeting of Stockholders may vest on the date of our Company’s next Annual Meeting. Notwithstanding the foregoing, up to 5% of the aggregate number of shares authorized for issuance under the Proposed A&R Plan may be issued pursuant to awards subject to any, or no, vesting conditions, as our Board determines appropriate. Clawback. If any policy adopted by the Nasdaq Stock Market requires the repayment of incentive-based compensation received by a participant, the participants in the Proposed A&R Plan agree to such repayment to the extent required by such policy and applicable law. Further, subject to the provisions of the Proposed A&R Plan, awards will be subject to any recovery, recoupment, clawback, and/or other forfeiture policy maintained by our Company. General Provisions. The Proposed A&R Plan is intended to be an unfunded plan. Each award will be evidenced by a written document (which may be electronic) delivered to the participant specifying the terms and conditions thereof and containing TABLE OF CONTENTS HOLOGIC, INC. 2023 Proxy Statement
such other terms and conditions not inconsistent with the provisions of the Proposed A&R Plan as our Board considers necessary or advisable. Each type of grant may be made alone, in addition to, or in relation to any other type of grant. The terms of each type of award need not be identical and our Board need not treat participants uniformly. Our Board may amend, modify or terminate any outstanding grant, including substituting therefor another award, changing the date of exercise or realization and converting an ISO to an NQSO, provided that the participant’s consent to such action shall be required unless our Board determines that the action (i) would not materially and adversely affect the participant or that any such adverse effect has been adequately compensated or (ii) is required or advisable in order for our Company, the Proposed A&R Plan, or the award to satisfy any law or regulation and meet the requirements or avoid adverse financial accounting consequences under any accounting standard; provided, however, in no event may our Board or our Company amend or modify any outstanding award to lower the award, exercise or conversion price applicable to such award or, when the exercise price of an outstanding award is above the fair market value per share of our common stock, take any action to otherwise cancel and re-grant or exchange an outstanding option or stock appreciation right for cash or another award, unless such action is approved by our stockholders (except in the case of a change of control). Our Board may amend, suspend or terminate the Proposed A&R Plan or any portion thereof at any time; provided that no amendment shall be made without stockholder approval if such approval is necessary to comply with any applicable law, rules or regulations. Our Board may also create a sub plan under the Proposed A&R Plan to comply with the laws and regulations of any foreign country in which we may seek to grant options and awards to persons eligible to participate in the Proposed A&R Plan. Our Board will determine the effect on an award of the death, disability, retirement or other termination of employment of a participant and the extent to which and period during which the participant’s legal representative, guardian or designated beneficiary may receive payment of an award or exercise rights thereunder. Our Board, in its discretion, may waive or amend the operation of provisions regarding exercise of awards after termination of employment and, except as otherwise provided in the Proposed A&R Plan, adjust any of the terms under any award. Grants under the Proposed A&R Plan are not transferable other than as designated by the participant by will or by the laws of descent and distribution; provided, however, that upon meeting certain conditions and if our Board allows, an award recipient may transfer an award to any “family member” (as defined in Section A.1(a)(5) of the General Instructions to Form S-8 under the Securities Act of 1933, as amended) or certain trusts or partnerships. In such cases, except as otherwise specified, all vesting, exercisability and forfeiture provisions conditioned on the original award recipient’s continued employment or service will continue to be determined with reference to the original award recipient’s employment or service, and the responsibility to pay any taxes in connection with an award will remain with the original award recipient regardless of any transfer other than by will or intestate succession. Our Board, in its discretion, may take certain actions in the event of a change of control of our Company, including (i) providing for the acceleration of any time period relating to the exercise or realization of the grant, (ii) providing for the repurchase of the grant for an amount equal to the difference of (x) the consideration received per share for the securities underlying the grant in the change of control minus (y) the per share exercise price of such securities, (iii) adjusting the terms of the award in order to reflect the change of control, (iv) causing the award to be assumed, or new rights substituted therefor, by another entity, (v) providing for the termination of the award, or (vi) making such other provision as our Board may consider equitable and in our best interest, provided that, in the case of an action taken with respect to an outstanding award, the participant’s consent to such action shall be required unless our Board determines that the action, taking into account any related action, would not materially and adversely affect the participant (or that such adverse effect has been adequately compensated) or such action is required or advisable in order for the Company, the Proposed A&R Plan or the award to satisfy any law or regulation or to avoid an adverse financial accounting standard. United States Federal Income Tax Consequences The following discussion of the United States federal income tax consequences of the issuance of awards granted under the Proposed A&R Plan is based upon the provisions of the Code, current regulations adopted and proposed thereunder, and existing administrative rulings and pronouncements of the Internal Revenue Service (the “IRS”). It is not intended to be a complete discussion of all of the United States federal income tax consequences of the Proposed A&R Plan or of all of the requirements that must be met in order to qualify for the described tax treatment. The Proposed A&R Plan provides Hologic with broad discretion to grant many different types of awards. The discussion below illustrates the United States federal income tax consequences of only some of the types of awards Hologic is permitted to make under the Proposed A&R Plan. Depending on the type of award granted under the Proposed A&R Plan, the United States federal income tax consequences to Hologic and recipients of awards could materially differ from the discussion below. In addition, because the tax consequences may vary, and certain exceptions to the general rules discussed herein may be applicable, depending upon the personal circumstances and the type of award granted, each recipient should consider his or her personal situation and consult with his or her tax advisor with respect to the specific tax consequences applicable to each recipient. No information is provided in the discussion below about municipal, state, or foreign tax laws. TABLE OF CONTENTS HOLOGIC, INC. 2023 Proxy Statement
Incentive Stock Options A participant will not recognize taxable income upon either the grant or the exercise of an ISO, although taxable income may arise at the time of exercise for alternative minimum tax purposes. A participant holder will recognize taxable income upon the disposition of the shares received upon exercise of an ISO. Unless there is a “disqualifying disposition,” a participant will recognize long-term capital gain equal to the difference between the proceeds received on disposition and the participant’s basis in the shares (which generally equals the exercise price). A “disqualifying disposition” means any disposition of shares acquired on the exercise of an ISO within two years of the date the option was granted or within one year of the date the shares were issued to the option holder. If a participant disposes of ISO shares in a disqualifying disposition, the participant will recognize both ordinary income and capital gain in the year of disposition. Hologic will generally not be entitled to any deduction with respect to the grant or exercise of an ISO. However, if the participant makes a disqualifying disposition, Hologic will generally be entitled to a deduction in the year such disqualifying disposition is made, in an amount equal to the taxable ordinary income recognized by the holder. Nonqualified Stock Options A participant will not recognize any taxable income upon the grant of an NQSO. Generally, a participant recognizes ordinary income at the time an NQSO is exercised in an amount equal to the excess of the fair market value of the shares of common stock on the date of exercise over the exercise price. Hologic will generally be entitled to a deduction in an amount equal to the ordinary taxable income recognized by the participant. Restricted Stock The recipient of restricted stock will generally not recognize income at the time of the grant. When the award vests, recipients will recognize ordinary income in an amount equal to the fair market value of the stock at such time. However, no later than 30 days after a recipient receives an award of restricted stock, the recipient may elect under Section 83(b) of the Code to recognize taxable ordinary income in an amount equal to the fair market value of the shares at the time of grant. If a Section 83(b) election is timely made, the participant will not recognize any additional income upon investing. However, if the restricted stock is forfeited (e.g., upon the participant’s termination prior to vesting), the participant may not claim a deduction with respect to the income recognized as a result of the election. A recipient will recognize taxable income at the time any dividends paid with respect to unvested shares of restricted stock are received. For restricted stock, Hologic will generally be entitled to a compensation deduction in an amount equal to, and at the same time as, the ordinary income recognized by the participant. RSUs and Performance and Incentive Awards Generally, a participant will not recognize any taxable income upon the grant of an RSU or performance or incentive award. Upon settlement or payment of the award, the participant will recognize taxable ordinary income equal to the fair market value of the shares, cash or other property received at such time. Hologic will generally be entitled to a compensation deduction in an amount equal to, and at the same time as, the ordinary income recognized by the participant. TABLE OF CONTENTS HOLOGIC, INC. 2023 Proxy Statement
New Plan Benefits Our directors and executive officers have a financial interest in this proposal because, if adopted, the Proposed A&R Plan would increase the number of shares available for issuance to directors, executives and other employees under the Current A&R Plan, and the directors and executive officers are eligible participants thereunder. The benefits that will be awarded or paid in the future under the Proposed A&R Plan are not currently determinable. Such awards are within the discretion of the Compensation Committee, and the Compensation Committee has not determined future awards or who might receive them. Number of Options Historically Granted The table below shows, as to each Named Executive Officer and the various indicated groups, the aggregate number of shares of our Company’s common stock subject to option grants since the 2008 Equity Incentive Plan’s inception through September 24, 2022. Named Executive Officers: | | | | Stephen P. MacMillan | | | 2,828,007 | Karleen M. Oberton | | | 332,418 | John M. Griffin | | | 199,990 | Kevin R. Thornal | | | 115,498 | Jan Verstreken | | | 108,754 | All executive officers as a group (8 persons*) | | | 3,694,828 | All non-executive directors as a group (8 persons) | | | 733,848 | All employees, excluding executive officers | | | 31,444,228 |
*
| Includes three executive officers not specificially named in the table. |
Vote Required Approval of this proposal requires the affirmative vote of a majority of shares present, in person or represented by proxy, and voting on this proposal at the Annual Meeting. Abstentions and broker “non-votes” will not have any effect on the proposal to approve the Proposed A&R Plan. Recommendation of the Board | | | Our Board of Directors unanimously recommends that you vote “FOR” the approval of the Hologic, Inc. Amended and Restated 2008 Equity Incentive Plan. |
TABLE OF CONTENTS HOLOGIC, INC. 2023 Proxy Statement
Equity Compensation Plan Information We maintain a number of equity compensation plans for employees, officers, directors and others whose efforts contribute to our success. The table below sets forth certain information as of the end of our fiscal year ended September 24, 2022 regarding the shares of our common stock available for grant or granted under stock option plans and equity incentives that (i) were approved by our stockholders, and (ii) were not approved by our stockholders. Equity compensation plans approved by security holders(1) | | | 7,255,678 | | | $48.46 | | | 3,345,813 | Equity compensation plans not approved by security holders | | | — | | | $— | | | — | TOTAL | | | 7,255,678 | | | $48.46 | | | 3,345,813 |
(1)
| Includes 2,920,969 shares that are issuable upon restricted stock units (RSUs), performance stock units (PSUs) and market stock units (MSUs) vesting or settlement following deferral. The remaining balance consists of outstanding stock option grants. |
(2)
| The weighted average exercise price does not take into account the shares issuable with respect to outstanding RSUs, PSUs and MSUs, which have no exercise price. |
TABLE OF CONTENTS HOLOGIC, INC. 2023 Proxy Statement
Proposal No. 5 – Approve the Hologic, Inc. Amended and Restated 2012 Employee Stock Purchase Plan Effective March 2, 2016, stockholders approved an amendment and restatement of the Hologic 2012 Employee Stock Purchase Plan (the “ESPP”). On December 8, 2022, our Board, subject to stockholder approval at the Annual Meeting, approved a further amendment and restatement of the ESPP (“Proposed A&R ESPP”). The ESPP provides eligible employees with the opportunity to become Hologic stockholders and participate in the Company’s success, which aligns the interests of participating employees with those of stockholders. Employee participation in the ESPP far exceeds market norms - over 60% of the Company’s employees who are eligible to participate are enrolled in the ESPP. The Proposed A&R ESPP will enable the Company to continue to grant purchase rights to its employees at levels determined appropriate by the Compensation Committee. Based on Hologic’s stock price and historical rates of employee participation in the ESPP, we believe that there may not be sufficient shares available for purchase under the current ESPP through December 31, 2023. Additional shares are needed for use in the ESPP so that the ESPP can continue to be used as a benefit to attract and retain employees. We estimate that the addition of 3,000,000 shares will allow continued employee participation for approximately five years. If this amendment to the ESPP is not approved by stockholders, the Board will suspend future employee participation in the ESPP once the currently available shares are purchased. As of January 1, 2023, 874,334 shares remained available for future purchases under the ESPP. The following is a summary of the material terms and conditions of the Proposed A&R ESPP. This summary does not purport to be complete and is qualified in its entirety by reference to the terms of the ESPP (as proposed to be amended and restated), a copy of which is attached to this proxy statement as Annex C (marked to show proposed amendments) and incorporated herein by reference. Summary of the ESPP Purpose. The ESPP is intended to provide our employees with additional incentives by permitting them to acquire our common stock at a reduced price through payroll withholding. Effective Date. The ESPP was originally approved by the Board on November 1, 2011 and by stockholders on March 6, 2012. The ESPP was amended by the Board on December 16, 2015 and by stockholders on March 2, 2016. The Proposed A&R ESPP was approved by the Board on December 8, 2022, subject to the approval of our stockholders at this Annual Meeting. Term. The ESPP provides that it shall terminate when all of the shares of common stock reserved for the purposes of the ESPP have been purchased. The ESPP can also be terminated by our Board at any time effective on the termination of the then current offering period. Upon such termination or any other termination of the ESPP, all payroll deductions not used to purchase common stock will be refunded to the applicable employees without interest. Eligible Participants. The ESPP provides that employees (including officers and employee directors) who are employed before the first day of the applicable offering, are eligible to participate. However, the following employees are not eligible to participate in the ESPP: (i) any employee who would own 5% or more of our common stock, immediately after an option under the ESPP is granted and (ii) any employee whose customary employment is not for more than 20 hours per week. Based on the current employee population, there are over 4,000 eligible participants. Securities Offered and Terms of Participation. The maximum number of shares of common stock which may be purchased by all employees under the ESPP is currently 5,500,000, subject to adjustments for stock splits, stock dividends and similar transactions. The proposed amendment would increase the number of shares authorized for purchase by 3,000,000. Such shares may be authorized but unissued shares of common stock or shares of common stock reacquired by us, including shares of common stock purchased in the open market. Eligible employees who elect to participate in the ESPP must give instruction to the Company, or a designated broker as permitted, to withhold a specified dollar amount from their salary during the following six-month period (periods run from January 1 to June 30 and from July 1 to December 31 and each is referred to as an “Offering Period”). In addition, the Compensation Committee may, in its sole and absolute discretion, provide for additional Offering Periods provided that TABLE OF CONTENTS HOLOGIC, INC. 2023 Proxy Statement
such Offering Period shall not exceed 27 months or any other limitation imposed by Section 423 of the Code. The exercise price for each Offering Period shall be the lesser of (i) 85% of the price per share of the common stock on the first business day of the Offering Period, as reported by Nasdaq, and (ii) 85% of the price per share of the common stock on the last business day of the Offering Period, as reported by Nasdaq (such lesser price, the “Option Exercise Price”). We grant to each participant on the first day of the Offering Period, an option to purchase on the last day of the Offering Period, at the Option Exercise Price, that number of shares of common stock that his or her accumulated payroll deductions on the last day of the Offering Period will pay for at such price. The option is automatically deemed to be exercised if the employee is still a participant on the last day of the Offering Period. Participation ends automatically upon termination of employment. A participating employee may authorize a payroll deduction of any whole percentage up to but not more than 10% of his or her base pay (including commissions, if applicable) in effect on each offering commencement date. Deductions from any employee’s compensation may be decreased only once during an Offering Period. Deductions from any employee’s compensation may not be increased during an Offering Period. Under the ESPP, the number of shares purchased at the end of any Offering Period may not be more than 500 shares. Further, no employee shall be granted an option which permits the employee’s right to purchase common stock under the ESPP to accrue at a rate that exceeds, during any calendar year, $25,000 of the fair market value of such stock (to be calculated based on the fair market value of the stock on the first business day of the Offering Period) for each calendar year in which such option is outstanding at any time. An employee may withdraw from the ESPP, and withdraw all of the payroll deductions credited to his or her account under the ESPP at least five business days prior to the end of any Offering Period, or such other time as we or a designated broker may require. Upon such a withdrawal, the Company will refund, without interest, the entire remaining balance of the employee’s payroll deductions. Administration. The ESPP is administered by the Compensation Committee, and may be amended by our Board from time to time in any respect; provided, however, that no amendment shall be effective without stockholder approval if the amendment would materially increase the number of shares of common stock which may be issued under the ESPP, materially increase the benefits accruing to participants in the ESPP or materially modify the requirements as to eligibility for participation in the ESPP. United States Federal Tax Consequences The ESPP is intended to qualify as an “employee stock purchase plan” under Section 423 of the Code, but is not intended to be a “qualified plan” under Code Section 401(a). As noted above, each participating employee is granted an option on the first day of the Offering Period, which is automatically exercised if the employee is still a participant on the last day of the Offering Period. Unless a participant will not recognize income on the grant or exercise of an option under the ESPP. In addition, we will not have a deductible compensation expense as a result of such grant or exercise, unless there is a disqualifying disposition. A disqualifying disposition occurs if the participant disposes of the shares within the two-year period following the first day of the Offering Period for which the purchase occurred or within the one-year period following the date the purchase occurred. If the participant does not have a disqualifying disposition, or in the event of his or her death, the participant will recognize ordinary income upon disposition (including by sale, gift or death) in an amount equal to the lesser of: (i) the excess of the fair market value of the shares at the time of disposition or death over the Option Exercise Price, or (ii) the excess of the fair market value of the shares on the first day of the Offering Period over the Option Exercise Price. In the case of a disposition by sale or gift, the sum of this amount plus the Option Exercise Price paid will be the participant’s tax basis in the common stock. In the case of death, the basis of the common stock in the hands of the decedent’s estate is subject to special valuation rules. A participant will recognize long-term capital gain (or loss) to the extent the sale proceeds exceed (or are exceeded by) the tax basis. If the sale price is less than the price paid, the participant will not recognize any ordinary income, and any loss that the participant incurs on the sale will be a capital loss. If shares purchased under the ESPP are sold in a disqualifying disposition, then the participant will recognize ordinary income in the year of disposition in an amount equal to the excess of the fair market value of the shares on the purchase date over the Option Exercise Price, or, if less, the excess of the sale proceeds realized on disposition of the common stock over the Option Exercise Price. Any remaining gain will be treated as capital gain, which may be long or short-term, depending on the time that the shares are held. If an employee does recognize ordinary income as a result of a disqualifying disposition, Hologic will gnerally be entitled to a compensation deduction in an amount equal to the ordinary income recognized by the participant. If the sale price is less than the Option Exercise Price, the participant will not recognize any ordinary income, and any loss that the participant incurs on the sale will be a capital loss. The foregoing summary of the effect of federal income taxation upon the participant and us with respect to the purchase of shares under the ESPP does not purport to be complete, and reference should be made to the applicable provisions of the Code. In addition, this summary does not discuss the provisions of the income tax laws of any municipality, state, or foreign country in which the participant may reside. The applicable tax rules are complex and may change, and income tax TABLE OF CONTENTS HOLOGIC, INC. 2023 Proxy Statement
consequences may vary depending on a participating employee’s particular circumstance. Therefore, each participating employee should consult with his or her tax advisor concerning his or her participation in the ESPP. If you are an employee that is not subject to U.S. federal income tax, then the foregoing will not apply to you and you will have to refer to the applicable tax laws that apply. New Plan Benefits The benefits to be received by our executive officers and employees under the ESPP are not determinable because, under the terms of the ESPP, the amounts of future stock purchases are based upon elections made by eligible employees subject to the terms and limits of the ESPP. Directors who are not employees do not qualify as eligible employees and thus cannot participate in the ESPP. Future purchase prices are not determinable because they will be based upon the closing market price per share of the common stock, as reported by Nasdaq, on either the first business day of the applicable Offering Period or the last business day of the applicable Offering Period, depending on which closing market price is lower. Our executive officers have a financial interest in this proposal because, if adopted, the ESPP would increase the number of shares issuable to executives and other employees under the ESPP, and the executive officers are eligible participants thereunder. Vote Required Approval of this proposal requires the affirmative vote of a majority of shares present, in person or represented by proxy, and voting on this proposal at the Annual Meeting. Abstentions and broker “non-votes” will not have any effect on the proposal to amend our ESPP. Recommendation of the Board | | | Our Board of Directors unanimously recommends that you vote “FOR” the approval of the Hologic, Inc. Amended and Restated 2012 Employee Stock Purchase Plan. Management proxy holders will vote all duly submitted proxies FOR approval unless duly instructed otherwise. |
TABLE OF CONTENTS HOLOGIC, INC. 2023 Proxy Statement
Proposal No. 6 – Ratification of Independent Registered
Public Accounting Firm The Audit and Finance Committee has appointed Ernst & Young LLP (Ernst & Young), an independent registered public accounting firm, to audit our consolidated financial statements for the fiscal year ending September 25, 2021,2023, and the Board is asking stockholders to ratify that selection. Although ratification is not required by current law, rules, and regulations, as well as the charter of the Audit and Finance Committee, require the Audit and Finance Committee to engage, retain, and supervise the Company’s independent registered public accounting firm,by our Bylaws or otherwise the Board considers the selection of the independent registered public accounting firm to be an important matter of stockholder concern and is submitting the selection of Ernst & Young for ratification by stockholders as a matter of good corporate practice. Ernst & Young has continuously served as our independent registered public accounting firm since June 24, 2002. A representative of Ernst & Young will be available during the meeting to make a statement if such representative desires to do so and to respond to appropriate questions. Vote Required The affirmative vote of a majority of shares present, in person or represented by proxy, and votingproperly cast on this proposal at the Annual Meeting is required to ratify the appointment of Ernst & Young.approve this proposal. Abstentions and broker “non-votes” will not have any effect on the proposal to ratify the appointment of Ernst & Young.proposal. If the stockholders do not ratifyapprove the selection of Ernst & Young,proposal, the Audit and Finance Committee will review the Company’s relationship with Ernst & Young and take such action as it deems appropriate, which may include continuing to retain Ernst & Young as the Company’s independent registered public accounting firm. Recommendation of the Board | | | | Our Board of Directors unanimously recommends that you vote “FOR”the ratification of the appointment of Ernst & Young.Young for fiscal 2023. Management proxy holders will vote all duly submitted proxies FOR ratification unless instructed otherwise. | |
TABLE OF CONTENTS HOLOGIC, INC. 20212023 Proxy Statement
Independent Registered Public Accounting Firm Fees The following is a summary of the fees billed to us by Ernst & Young for professional services rendered for the fiscal years ended September 26, 202024, 2022 and September 28, 2019:25, 2021: | Audit Fees | | | 5,687,000 | | | 6,448,000 | | | Audit-Related Fees | | | 901,000 | | | 2,354,000 | | | Tax Fees | | | 1,499,000 | | | 2,693,000 | | | All Other Fees | | | 8,000 | | | 7,200 | | | TOTAL FEES | | | 8,095,000 | | | 11,502,200 | |
Audit Fees | | | 6,994,300 | | | 5,829,000 | Audit-Related Fees | | | 123,200 | | | 1,521,700 | Tax Fees | | | 1,593,700 | | | 1,478,500 | All Other Fees | | | 8,000 | | | 8,000 | TOTAL FEES | | | 8,719,200 | | | 8,837,200 |
Audit Fees.Fees. Consists of aggregate fees billed for professional services rendered in connection with the audit of our consolidated financial statements, the audit of the effectiveness of our internal control over financial reporting, reviews of the interim consolidated financial statements included in our quarterly reports, international statutory audits and regulatory filings, consents and other services related to SEC filings, and accounting consultations that relate to the audited financial statements and are necessary to comply with GAAP. Audit-Related Fees.Fees. Consists of aggregate fees billed for assurance and related services that are reasonably related to the performance of the audit or review of our consolidated financial statements and are not reported under “Audit Fees.” The fiscal 20202022 and 2021 audit-related fees primarily included amounts for due diligence services andsolely related to a lesser extent fees for auditing carve-out financial statements. The fiscal 2019 audit-related fees primarily included amounts for auditing carve-out financial statements for the former Medical Aesthetics segment, and to a much lesser extent, due diligence services. Tax Fees.Fees. Consists of aggregate fees billed for professional services rendered for tax compliance, tax advice and tax planning. In fiscal 20202022 and 2019,2021, these services included assistance regarding federal, state and international tax compliance, assistance with transfer pricing analyses and general consultations. All Other Fees.Fees. Represents the license of technical accounting research software. During fiscal 20202022 and fiscal 2019,2021, there were no other fees for any services not included in the above categories. The Audit and Finance Committee considers whether the provision of these services is compatible with maintaining the independence of the independent registered public accounting firm and has determined such services for fiscal 20202022 and 20192021 were compatible. Audit and Finance Committee Policy on Pre-Approval of Services The Audit and Finance Committee’s policy is to pre-approve all audit and permissible non-audit services provided by our independent registered public accounting firm. These services may include audit services, audit-related services, tax services and other services. The Audit and Finance Committee has delegated authority to the Chair of the Audit and Finance Committee to pre-approve services up to a designated amount. A summary of any new services pre-approved by the Chair is reported to the full Audit and Finance Committee in connection with its next scheduled meeting. The Audit and Finance Committee meets with representatives of Ernst & Young periodically, but no less than quarterly throughout the year. The Audit and Finance Committee reviews audit, non-audit and tax services rendered by and the performance of Ernst & Young, as well as fees charged by Ernst & Young for such services. In engaging Ernst & Young for the services described above, the Audit and Finance Committee considered whether the provision of such services is compatible with maintaining Ernst & Young’s independence. TABLE OF CONTENTS HOLOGIC, INC. 20212023 Proxy Statement
Audit and Finance Committee Report Pursuant to authority delegated by the Board of Directors of Hologic, Inc., the Audit and Finance Committee is responsible for assisting the Board in its oversight of the integrity of the Company’s consolidated financial statements, the qualifications and independence of the Company’s independent registered public accounting firm, and the Company’s internal financial and accounting controls. Management is responsible for the Company’s financial reporting process, including the responsibility to maintain and evaluate the effectiveness of internal control over financial reporting, and for the preparation of consolidated financial statements in accordance with generally accepted accounting principles in the United States (GAAP). The Company’s independent registered public accounting firm is responsible for auditing those financial statements and expressing an opinion as to their conformity with GAAP. The Audit and Finance Committee’s responsibility is to oversee and review these processes. The Audit and Finance Committee is not, however, engaged in the practice of accounting or auditing and does not provide any expert or other special assurance as to such financial statements concerning compliance with laws, regulations or GAAP or as to the independence of the independent registered public accounting firm. The Audit and Finance Committee relies, without independent verification, on the information provided to it and on the representations made by management and the independent registered public accounting firm. The Audit and Finance Committee’s responsibilities are described in a written charter. A copy of the Audit and Finance Committee’s current charter is publicly available on our website at investors.hologic.com. The Audit and Finance Committee has threefour members, all of whom are independent directors as defined by Nasdaq listing standards and Rule 10A-3 of the Securities Exchange Act of 1934, as amended. The Audit and Finance Committee met nine (9) times during fiscal 2020.2022. The meetings were designed, among other things, to facilitate and encourage communication among the Audit and Finance Committee, management, the internal audit function and the Company’s independent registered public accounting firm, Ernst & Young LLP (Ernst & Young). The Audit and Finance Committee discussed with Ernst & Young the overall scope and plans for its audits and the Committee regularly met with Ernst & Young without the presence of management. Ernst & Young has unrestricted access to the Audit and Finance Committee. The Audit and Finance Committee reviewed and discussed with management and Ernst & Young the Company’s audited financial statements for the fiscal year ended September 26, 2020,24, 2022, the results of management’s assessment of the effectiveness of the Company’s internal control over financial reporting and the independent auditor’s audit of internal control over financial reporting. The Audit and Finance Committee also discussed with Ernst & Young the matters required to be discussed by the applicable requirements of the Public Company Accounting Oversight Board (PCAOB) and the Securities and Exchange Commission. The Audit and Finance Committee also received and reviewed the written disclosure and the letter from Ernst & Young required by applicable requirements of the PCAOB regarding Ernst & Young’s communications with the Audit and Finance Committee concerning independence, including relevant considerations of non-audit services and fees, and the Audit and Finance Committee discussed with Ernst & Young its independence from the Company. Based on the review and discussions described above, and subject to the limitations on the Audit and Finance Committee’s role and responsibilities referred to above and in its charter, the Audit and Finance Committee recommended to the Board of Directors that the audited consolidated financial statements be included in the Company’s Annual Report on Form 10-K for the fiscal year ended September 26, 2020.24, 2022. The Audit and Finance Committee has also approved the selection of Ernst & Young as our independent registered public accounting firm for the fiscal year ending September 25, 2021.30, 2023. Respectfully Submitted by the
Audit and Finance Committee Charles J. Dockendorff, Chair
Christiana Stamoulis
Stacey D. Stewart
Amy M. Wendell TABLE OF CONTENTS HOLOGIC, INC. 20212023 Proxy Statement
Securities Ownership by Directors and Executive Officers The following table sets forth certain information regarding beneficial ownership of our common stock as of January 12, 202111, 2023 by each of our directors or nominees for director, each of our NEOs and all of our directors, nominees for director and executive officers as a group. | Non-Employee Directors
| | | | | | | | | Sally W. Crawford(3) | | | 174,610 | | | * | | | Charles J. Dockendorff(3) | | | 46,704(4) | | | * | | | Scott T. Garrett(3) | | | 102,551 | | | * | | | Ludwig N. Hantson(3) | | | 18,652 | | | * | | | Namal Nawana(3) | | | 36,222 | | | * | | | Christiana Stamoulis(3) | | | 84,045 | | | * | | | Amy M. Wendell(3) | | | 44,362 | | | * | | | Named Executive Officers
| | | | | | | | | Stephen P. MacMillan(3) | | | 2,269,529 | | | * | | | Karleen M. Oberton(3) | | | 68,009 | | | * | | | John M. Griffin(3) | | | 129,829 | | | * | | | Kevin R. Thornal(3) | | | 44,521 | | | * | | | Peter J. Valenti, III(3) | | | 98,726 | | | * | | | All directors, nominees for director and executive officers as a group (14)(5) | | | 3,201,278 | | | 1.2 | |
Non-Employee Directors
| | | | | | | Sally W. Crawford(3) | | | 188,001 | | | * | Charles J. Dockendorff(3) | | | 62,312(4) | | | * | Scott T. Garrett(3) | | | 115,942 | | | * | Ludwig N. Hantson(3) | | | 30,565 | | | * | Namal Nawana(3) | | | 49,613 | | | * | Stacey D. Stewart(3) | | | 1,035 | | | * | Christiana Stamoulis(3) | | | 97,436 | | | * | Amy M. Wendell(3) | | | 57,753 | | | * | Named Executive Officers
| | | | | | | Stephen P. MacMillan(3) | | | 2,913,027 | | | 1.17% | Karleen M. Oberton(3) | | | 135,885 | | | * | John M. Griffin(3) | | | 172,501 | | | * | Kevin R. Thornal(3) | | | 93,203 | | | * | Jan Verstreken | | | 135,140 | | | * | All directors, nominees for director and executive officers as a group (16)(5) | | | 4,130,387 | | | 1.66% |
*
| Less than one percent of the outstanding shares of our common stock. |
(1)
| The persons named in the table have, to our knowledge, sole voting and investment power with respect to all shares shown as beneficially owned by them. |
(2)
| Applicable percentage ownership as of January 12, 202111, 2023 is based upon 257,661,792246,551,026 shares of our common stock outstanding. Beneficial ownership is determined in accordance with the rules and regulations of the SEC and includes voting and investment power with respect to shares. Shares of our common stock subject to options currently exercisable or exercisable within 60 days after January 12, 202111, 2023 and RSUs that vest within 60 days after January 12, 202111, 2023 are deemed outstanding for computing the percentage ownership of the person holding such options and RSUs but are not deemed outstanding for computing the percentage ownership of any other person. |
TABLE OF CONTENTS HOLOGIC, INC. 20212023 Proxy Statement
(3)
| Includes the following options currently exercisable or exercisable within 60 days after January 12, 202111, 2023 (column a); and RSUs/PSUs vesting within 60 days after January 12, 202111, 2023 (column b). Does not include the following PSUs/RSUs which have vested or will vest within 60 days after January 12, 2021,11, 2023, but as to which settlement has been deferred (column c): |
| Sally W. Crawford | | | 47,763 | | | 2,217 | | | — | | | Charles J. Dockendorff | | | 26,792 | | | 2,217 | | | 2,217 | | | Scott T. Garrett | | | 44,653 | | | 2,217 | | | 4,633 | | | Ludwig N. Hantson | | | 15,857 | | | 2,217 | | | 2,217 | | | Namal Nawana | | | 22,509 | | | 2,217 | | | — | | | Christiana Stamoulis | | | 44,653 | | | 2,217 | | | — | | | Amy M. Wendell | | | 29,712 | | | 2,217 | | | — | | | Stephen P. MacMillan | | | 1,299,417 | | | — | | | 1,079,673 | | | Karleen M. Oberton | | | 40,321 | | | — | | | 13,381 | | | John M. Griffin | | | 68,071 | | | — | | | 46,727 | | | Kevin R. Thornal | | | 21,808 | | | — | | | — | | | Peter J. Valenti, III | | | 35,144 | | | 20,644 | | | — | |
Sally W. Crawford | | | 58,111 | | | 1,565 | | | — | Charles J. Dockendorff | | | 37,140 | | | 1,565 | | | — | Scott T. Garrett | | | 55,001 | | | 1,565 | | | 4,633 | Ludwig N. Hantson | | | 26,205 | | | 1,565 | | | 3,695 | Namal Nawana | | | 32,857 | | | 1,565 | | | — | Christiana Stamoulis | | | 55,001 | | | 1,565 | | | — | Stacey D. Stewart | | | 768 | | | 267 | | | — | Amy M. Wendell | | | 40,060 | | | 1,565 | | | — | Stephen P. MacMillan | | | 1,774,831 | | | — | | | 1,079,673 | Karleen M. Oberton | | | 73,711 | | | — | | | 41,121 | John M. Griffin | | | 65,498 | | | — | | | 46,727 | Kevin R. Thornal | | | 43,366 | | | — | | | — | Jan Verstreken | | | 70,776 | | | — | | | — |
(4)
| Includes 19,9121,336 shares of common stock held in a Grantor Retained Annuity Trust. Trust and 18,576 shares held in revocable trusts. |
(5)
| Includes, for three executive officers not specifically named in the table, an aggregate of 104,14563,609 common shares issuable upon the exercise of options presently exercisable or exercisable within 60 days after January 12, 2021.11, 2023. |
TABLE OF CONTENTS HOLOGIC, INC. 20212023 Proxy Statement
Security Ownership by Certain Beneficial Owners The following table sets forth certain information regarding beneficial ownership of our common stock as January 12, 202111, 2023 by each person who is known by us to own beneficially more than 5% of the outstanding shares of our common stock, based on public filings with the SEC. | Greater than 5% Beneficial Owners
| | | | | | | | | T. Rowe Price Associates, Inc.(3)
100 E. Pratt St. Baltimore, MD 21202 | | | 44,152,761 | | | 17.1 | | | The Vanguard Group(4)
100 Vanguard Blvd. Malvern, PA 19355 | | | 30,140,408 | | | 11.7 | | | FMR LLC(5)
245 Summer Street, Boston, MA 02210 | | | 25,750,344 | | | 10.0 | | | BlackRock, Inc.(6)
55 East 52nd Street New York, NY 10055 | | | 21,995,732 | | | 8.5 | |
Greater than 5% Beneficial Owners
| | | | | | | The Vanguard Group(3)
100 Vanguard Blvd. Malvern, PA 19355 | | | 27,500,693 | | | 11.2% | BlackRock, Inc.(4)
55 East 52nd Street New York, NY 10055 | | | 21,888,278 | | | 8.9% |
(1)
| The persons named in the table have, to our knowledge, sole voting and investment power with respect to all shares shown as beneficially owned by them, except as noted in the footnotes below. |
(2)
| Applicable percentage ownership as of January 12, 202111, 2023 is based upon 257,661,792246,551,026 shares of our common stock outstanding. Beneficial ownership is determined in accordance with the rules and regulations of the SEC and includes voting and investment power with respect to shares. |
(3)
| Amount and nature of ownership listed is based solely upon information contained in a Schedule 13G/A filed with the SEC by T. Rowe Price Associates, Inc.The Vanguard Group on February 14, 2020.9, 2022. The Schedule 13G/A indicates that, as of December 31, 2019, T. Rowe Price Associates, Inc.2021, The Vanguard Group had soleshared voting power over 16,419,942401,070 shares, and sole dispositive power over 44,093,70526,480,671 shares and shared dispositive power over 1,020,022 shares. |
(4)
| Amount and nature of ownership listed is based solely upon information contained in a Schedule 13G/A filed with the SEC by The Vanguard GroupBlackRock, Inc. on February 12, 2020.1, 2022. The Schedule 13G/A indicates that, as of December 31, 2019, The Vanguard Group had, sole voting power over 425,664 shares, shared voting power over 81,863 shares, sole dispositive power over 29,670,401 shares and shared dispositive power over 470,007 shares. |
(5)
| Amount and nature of ownership listed is based solely upon information contained in a Schedule 13G/A filed with the SEC by FMR LLC on December 10, 2020. The Schedule G/A indicates that, as of December 9, 2020, FMR LLC had sole voting power over 2,106,568 shares and sole dispositive power over 25,750,344 shares. |
(6)
| Amount and nature of ownership listed is based solely upon information contained in a Schedule 13G/A filed with the SEC by BlackRock, Inc. on February 5, 2020. The Schedule 13G/A indicates that, as of December 31, 2019,2021, BlackRock, Inc. had sole voting power over 19,074,90919,183,059 shares and sole dispositive power over 21,995,73221,888,278 shares.
|
TABLE OF CONTENTS HOLOGIC, INC. 20212023 Proxy Statement
about the Meeting and Voting WHY AM I RECEIVING THESE MATERIALS? The Company is making this proxy statement and other Annual Meeting materials available to you on the internet or, upon your request, sending printed versions of these materials to you by mail, because the Board of Directors of the Company is soliciting your proxy to vote at our Annual Meeting of Stockholders to be held on March 11, 20219, 2023 at 8:00 a.m., Eastern Time, at our offices, 250 Campus Drive, Marlborough, Massachusetts 01752, and at any adjournment(s) or postponement(s) thereof. The mailing address of the principal executive office of the Company is 250 Campus Drive, Marlborough, MA 01752. You are invited to attend the Annual Meeting and are requested to vote on the proposals described in this proxy statement. We are monitoringcontinue to monitor COVID-19 developments and other circumstances, as well as guidance issued by relevant health organizations. Shouldorganizations, and we may determine that alternative arrangements may beare advisable or required, such as changing the date, time, location or format of the meeting, wemeeting. We will announce our decisionany such changes, as well as how to participate in the meeting by press release and post additional information on our website. These changes and related determinations will be made and communicated in accordance with, and subject to, Delaware law and U.S. securities law requirements and guidance. WHAT IS THE PURPOSE OF THE ANNUAL MEETING? At the Annual Meeting, stockholders will vote upon matters that are summarized in the formal meeting notice. The proxy statement contains important information for you to consider when deciding how to vote on the matters before the meeting. Please read it carefully. WHO CAN VOTE? Our Board of Directors has fixed the close of business on January 12, 202111, 2023 as the record date (the Record Date). Accordingly, only holders of record of our common stock, $0.01 par value per share, as of the close of business on the Record Date will be entitled to notice of, and to vote at, the Annual Meeting or any adjournment(s) or postponement(s) thereof. As of the Record Date, an aggregate of 257,661,792246,551,026 shares of our common stock were issued and outstanding, held by 922825 holders of record. The holders of our common stock are entitled to one vote per share on any proposal presented at the Annual Meeting. WHAT ITEMS AM I VOTING ON? Stockholders will vote on the following items at the Annual Meeting: 1.
| The proposed election of the eight (8)nine (9) nominees identified in this proxy statement to serve as directors for the ensuing year (Proposal No. 1); |
2.
| A non-binding advisory resolution to approve our executive compensation (Proposal No. 2); |
3.
| A non-binding advisory vote on the frequency of future advisory votes to approve our executive compensation (Proposal No. 3); |
4.
| To approve the Hologic, Inc. Amended and Restated 2008 Equity Incentive Plan (Proposal No. 4); |
5.
| To approve the Hologic, Inc. Amended and Restated 2012 Employee Stock Purchase Plan (“ESPP”) (Proposal No. 5); |
6.
| Proposed ratification of the appointment of Ernst & Young LLP as our independent registered public accounting firm for fiscal 20212023 (Proposal No. 3)6); and |
4.7.
| The transaction of such other business as may properly come before the meeting or any adjournment thereof. |
TABLE OF CONTENTS HOLOGIC, INC. 2023 Proxy Statement
WHAT ARE THE VOTING RECOMMENDATIONS OF THE BOARD OF DIRECTORS? Our Board of Directors recommends that you vote your shares: | each of the nominees for director (Proposal No. 1); | | | the approval of the non-binding advisory resolution approving the Company’s executive compensation (Proposal No. 2); | | | the approval of the non-binding advisory vote on the frequency of future advisory votes to approve our executive compensation (Proposal No. 3) | | | the approval of the Hologic, Inc. Amended and Restated 2008 Equity Incentive Plan (Proposal No. 4) | | | the approval of the Hologic, Inc. Amended and Restated 2012 Employee Stock Purchase Plan (Proposal No. 5) | | | the ratification of the appointment of Ernst & Young as our independent registered public accounting firm for fiscal 20212023 (Proposal No. 3). | |
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HOLOGIC, INC. 2021 Proxy Statement
HOW DO I VOTE MY SHARES? You may vote in person or by proxy. Your execution of a proxy will not in any way affect your right to attend the Annual Meeting and vote in person. If you are a stockholder of record (that is, if you hold shares that are directly registered in your own name), there are four ways to vote: | You may vote by proxy via the internet by following the instructions provided in the Notice of Meeting and Important Notice Regarding the Availability of Proxy Materials (the Notice). | | | If you requested printed copies of proxy materials by mail, you may vote by proxy via telephone by calling the toll-free number found on the proxy card. | | | If you requested printed copies of proxy materials by mail, you may vote by proxy via mail by filling out the proxy card (you must be sure to complete, sign and date the proxy card) and returning it in the envelope provided. | | | You may vote in person at the Annual Meeting. We will provide you with a ballot when you arrive. Stockholders who plan to attend the meeting must present valid photo identification. Stockholders of record will be verified against an official list available at the registration area. We reserve the right to deny admittance to anyone who cannot show valid identification or sufficient proof of share ownership as of the record date. | |
If your shares are held in the name of a bank, broker or other holder of record, which is known as being held in “street name,” you will receive separate voting instructions with your proxy materials. If you hold your shares in street name, your ability to vote by internet or by telephone depends on the voting process of the bank, broker or other holder of record that holds your shares. Although most banks, brokers and other holders of record also offer internet and telephone voting, availability and specific procedures will depend on their voting arrangements. Please follow their directions carefully. If you want to vote shares that you hold in street name at the Annual Meeting, you must request a legal proxy from the bank, broker, or other holder of record that holds your shares and present that proxy, along with valid photo identification and sufficient proof of share ownership as of the record date, at the meeting. We reserve the right to deny admittance to anyone who cannot show valid identification or sufficient proof of share ownership as of the record date. CAN I CHANGE MY VOTE AFTER I HAVE VOTED? You may revoke your proxy and change your vote at any time before the final vote at the Annual Meeting by: (1) filing with our Corporate Secretary a written notice of revocation, (2) executing a later dated proxy relating to the same shares and delivering it to our Corporate Secretary, or (3) attending the Annual Meeting and voting in person (although attendance at the Annual Meeting will not in and of itself constitute a revocation of a proxy). If your shares are held in street name, you should contact your bank, broker or other nominee to revoke your proxy or, if you have obtained a legal proxy from your bank, broker or other nominee giving you the right to vote your shares at the Annual Meeting, you may change your vote by attending the Annual Meeting and voting in person. Any written notice of revocation or subsequent proxy should be sent to the attention of our Corporate Secretary, Hologic, Inc., 250 Campus Drive, Marlborough, MA 01752, at or before the final vote at the Annual Meeting. TABLE OF CONTENTS HOLOGIC, INC. 2023 Proxy Statement
HOW MANY SHARES MUST BE PRESENT TO HOLD THE ANNUAL MEETING? AThe holders of a majority in voting power of theall stock issued, outstanding shares of our common stockand entitled to vote at the Annual Meeting must be present in person or by proxy to hold the Annual Meeting and conduct business. This is called a quorum. Votes withheld, abstentionsAbstentions and broker “non-votes” are counted as present or represented for purposes of determining the presence or absence of a quorum. A “non-vote” occurs when a broker holding shares for a beneficial owner votes on one proposal, but does not vote on another proposal because, in respect of such other proposal, the broker does not have discretionary voting power and has not received instructions from the beneficial owner. Shares voted in the manner described above will be counted as present at the Annual Meeting. If a quorum is not present, the Annual Meeting will be adjourned until a quorum is obtained.
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HOLOGIC, INC. 2021 Proxy Statement
WHAT VOTE IS REQUIRED TO APPROVE EACH PROPOSAL AND HOW ARE VOTES COUNTED? A nominee will be elected to the Board of Directors if the votes cast “for” the nominee’s election exceed the votes cast “against” the nominee’s election. Abstentions and broker non-votes will not have any effect on this proposal. In accordance with our Bylaws, if any nominee for director in an uncontested election fails to receive a majority of the votes cast “for” the nominee’s election, the nominee must promptly tender his or her resignation to our Board of Directors. This is an uncontested election of directors because the number of nominees for director does not exceed the number of directors to be elected. Within 90 days after the certification of the election results, the remaining members of our Board of Directors shall, through a process managed by the Nominating and Corporate Governance Committee, and excluding the director nominee in question, determine whether to accept such resignation and publicly disclose the results of such determination. Approval of Proposals No. 2 andthrough No. 36 requires the affirmative vote of a majority of shares present, in person or represented by proxy, and votingthe votes properly cast on each such matter at the Annual Meeting. Abstentions and broker “non-votes” are included in the number of shares present or represented for purposes of quorum but are disregarded for purposes of determining whether any of the proposals have been approved. Banks, brokers, or other holders of record may vote shares held for a customer in street name on matters that are considered to be “routine” even if they have not received instructions from their customer. A broker “non-vote” occurs when a bank, broker, or other holder of record has not received voting instructions from a customer and cannot vote the customer’s shares because the matter is not considered routine. One of the proposals before the Annual Meeting this year is deemed a “routine” matter, namely the ratification of the appointment of Ernst & Young as our independent registered public accounting firm for fiscal 20212023 (Proposal No. 3)6). This means that if your shares are held in street name your bank, broker, or other nominee can vote your shares on that proposal if you do not provide timely instructions for voting your shares. The election of directors (Proposal No. 1) and, the non-binding advisory vote to approve executive compensation (Proposal No. 2), the non-binding advisory vote to approve the frequency of future advisory votes (Proposal No. 3), the amendment and restatement of our 2008 equity incentive plan (Proposal No. 4) and the amendment and restatement to our 2012 employee stock purchase plan (Proposal No. 5) are not considered “routine” matters. As a result, if you do not instruct your bank, broker or nominee how to vote with respect to those matters, your bank, broker or nominee may not vote on those proposals and a broker “non-vote” will occur. ARE THERE OTHER MATTERS TO BE VOTED ON AT THE ANNUAL MEETING? We doare not knowaware of any other matters to be presented at the Annual Meeting. If any other matters are properly presented at the Annual Meeting, your proxy authorizes us to vote, or otherwise act in accordance with the best judgment and discretion of the persons named as proxies below. HOW ARE PROXIES VOTED? The persons named as the proxies, Stephen P. MacMillan, Karleen M. Oberton and John M. Griffin, were selected by our Board of Directors. Mr. MacMillan is a director and officer of Hologic, and Ms. Oberton and Mr. Griffin are officers of Hologic. All properly executed proxies returned in time to be counted at the Annual Meeting will be voted. When giving your proxy, you may withhold authority to voteabstain from voting for any individual nominee for director. | Your proxy will be voted in accordance with your instructions. If you submit your proxy card without specifying your voting instructions, your shares will be voted in accordance with the recommendations of our Board of Directors listed above for all matters presented in this proxy statement. |
TABLE OF CONTENTS HOLOGIC, INC. 2023 Proxy Statement
WHERE CAN I FIND THE VOTING RESULTS OF THE ANNUAL MEETING? The preliminary voting results will be announced at the Annual Meeting. The final voting results will be tallied by the inspector of election and published in a Current Report on Form 8-K, which we are required to file with the SEC within four business days following the Annual Meeting. TABLE OF CONTENTS
HOLOGIC, INC. 2021 Proxy Statement
WHY DID I RECEIVE A ONE-PAGE NOTICE IN THE MAIL REGARDING THE INTERNET AVAILABILITY OF PROXY MATERIALS INSTEAD OF A FULL SET OF PROXY MATERIALS? Under rules adopted by the SEC, we are furnishing proxy materials to our stockholders primarily via the internet, instead of mailing printed copies of those materials to each stockholder. On or about January 21, 2021,19, 2023, we will mail to our stockholders of record as of January 12, 202111, 2023 (other than those who previously requested electronic or paper delivery on an ongoing basis) a Notice of Meeting and Important Notice Regarding the Availability of Proxy Materials (the Notice) containing instructions on how to access our proxy materials, including our proxy statement and our Annual Report on Form 10-K. All stockholders will have the ability to access our proxy materials on the website referred to in the Notice or request a printed set of the proxy materials. Instructions on how to access our proxy materials on the internet or to request printed versions are provided in the Notice. The Notice also instructs you on how to access your proxy card to vote through the internet or by telephone. In addition, stockholders may request to receive proxy materials in printed form by mail or electronically by email on an ongoing basis. If you have previously elected to receive our proxy materials electronically, you will continue to receive these materials via email until you elect otherwise. HOW CAN I RECEIVE PROXY MATERIALS ELECTRONICALLY? The Notice will provide you with instructions regarding the method of delivery for future proxy materials. Choosing to access our proxy materials via the Internet or to receive future proxy materials by email will reduce the impact of our Annual Meetings on the environment as well as decrease the cost of printing and mailing documents to you. If you choose to receive future proxy materials by email, you will receive an email next year with instructions containing a link to those materials and a link to the proxy voting site. Your election to receive proxy materials by email will remain in effect until you terminate it. If you hold your stock through a bank, broker or other holder of record and you would like to receive future proxy materials electronically, please refer to the information provided by that entity for instructions on how to elect this option. HOW DO I RECEIVE A PAPER COPY OF THE MATERIALS? If you prefer to receive paper copies of the proxy materials, you can still do so. You may request a paper copy by following the instructions provided in the Notice. The Notice also provides you with instructions on how to request paper copies of the proxy materials on an ongoing basis. There is no charge to receive the materials by mail. You may request printed copies of the materials until one year after the date of the Annual Meeting. If you have previously elected to receive printed proxy materials, you will continue to receive these materials in paper format until you elect otherwise. WHAT IS “HOUSEHOLDING”? If you are a registered stockholder residing at an address with other registered stockholders, andyou will receive only one copy of the proxy statement or annual report unless you indicate otherwise. If you wish to receive a separate copy of the proxy statement or annual report, or if you do not wish to participate in householding and prefer to receive separate copies of these documents in the future, please contact our mailing agent, Broadridge, either by calling toll-free at 1-866-540-7095, or by writing to Broadridge, Householding Department, 51 Mercedes Way, Edgewood, New York 11717. If you own shares through a bank, broker or other nominee, you should contact the nominee directly concerning Householding. WHO IS PAYING FOR THE COST OF THIS PROXY SOLICITATION? All costs of solicitation of proxies will be borne by us. In addition to solicitations by mail, certain of our directors, officers, employees and other agents, without additional remuneration, may solicit proxies in person or by telephone or email. We may elect to engage outside professionals to assist us in the distribution and solicitation of proxies at a fee to be borne by us. Brokers, custodians and fiduciaries will be requested to forward proxy soliciting material to the owners of shares held in their names, and we will reimburse them for their reasonable out-of-pocket costs. Solicitation may also be made of some stockholders in person or by mail, telephone or email following the original solicitation. Additionally, we have retained Okapi Partners LLC to assist us in the solicitation and distribution of proxies for the Annual Meeting. The estimated cost of such services is $10,000,$11,000, plus out-of-pocket expenses. Stockholders with questions or that need assistance in voting their shares may contact Okapi toll-free at (877) 259-6290. TABLE OF CONTENTS HOLOGIC, INC. 2023 Proxy Statement
Trademark Notice Hologic, The Science of Sure, Women’s Health Symbol or Logo, Genius, Genius 3D, 3D MAMMOGRAPHY, ThinPrep, NovaSure, MyoSure, Affirm, Aptima, Panther, Panther Fusion, SmartCurve, Intelligent 2D, Hologic Clarity HD, Acessa Health, Faxitron, Fluent Focal Therapeutics, SuperSonic Imagine, Brevera,Fluid Management System, The Science of Sure, and associated logos are trademarks and/or registered trademarks of Hologic, Inc. and/or its subsidiaries in the United States and/or other countries. All other trademarks are the property of their respective owners. TABLE OF CONTENTS
HOLOGIC, INC. 2021 Proxy Statement
for the 20222024 Annual Meeting Any stockholder who intends to present a Rule 14a-8 proposal at Hologic’s Annual Meeting of Stockholders to be held in 2022,2024, and who wishes to have a proposal included in Hologic’s proxy statement for that meeting, must deliver the proposal to the Corporate Secretary. All proposals must be received by the Corporate Secretary no later than September 23, 202121, 2023 and must satisfy the rules and regulations of the SEC as well as the applicable provisions of our Bylaws to be eligible for inclusion in the proxy statement for that meeting. A stockholder or group of up to 20 stockholders who have continuously owned at least 3% of Hologic’s common stock for at least three years have the ability to submit director nominees (up to the greater of two or 20% of the Board) for inclusion in the related proxy statement if the stockholder(s) and the nominee(s) satisfy the requirements specified between August 24, 202122, 2023 and September 23, 202121, 2023 and must include the information required for any Notice of Proxy Access Nomination (as defined in the Bylaws). To be eligible for consideration at the 20222024 Annual Meeting of Stockholders, any proposal that is a proper subject for consideration which has not been submitted by the deadline for inclusion in the proxy statement (as set forth above) and any nomination for director that is made outside of the proxy access procedures (as described above) must comply with the procedures specified in Hologic’s Bylaws. These procedures require, among other things, that any such proposal or nomination be received by the Corporate Secretary between close of business on November 11, 202110, 2023 and December 11, 2021.10, 2023. This advance notice period is intended to allow all stockholders an opportunity to consider all business and nominees expected to be considered at the meeting. In addition to satisfying the foregoing requirements under Hologic’s Bylaws, to comply with the universal proxy rules, stockholders who intend to solicit proxies in support of director nominees other than Hologic’s nominees must provide notice that sets forth the information required by Rule 14a-19 under the Exchange Act no later than January 10, 2024. All submissions to, or requests of, the Corporate Secretary should be made to Hologic’s principal executive offices at 250 Campus Drive, Marlborough, Massachusetts 01752. Incorporation by Reference To the extent that this proxy statement has been or will be specifically incorporated by reference into any filing made by us under the Securities Act of 1933, as amended, or the Exchange Act, the sections of the proxy statement entitled “Compensation Committee Report” and “Audit and Finance Committee Report” shall not be deemed to be so incorporated, unless specifically provided in any such filing. TABLE OF CONTENTS HOLOGIC, INC. 2023 Proxy Statement
Financial Matters and Form 10-K WE WILL PROVIDE EACH BENEFICIAL OWNER OF OUR SECURITIES WITH A COPY OF OUR ANNUAL REPORT ON FORM 10-K, INCLUDING THE FINANCIAL STATEMENTS AND SCHEDULES THERETO, REQUIRED TO BE FILED WITH THE SEC FOR OUR MOST RECENT FISCAL YEAR, WITHOUT CHARGE, UPON RECEIPT OF A WRITTEN REQUEST FROM SUCH PERSON. SUCH REQUEST SHOULD BE SENT TO INVESTOR RELATIONS, HOLOGIC, INC., 250 CAMPUS DRIVE, MARLBOROUGH, MA 01752. ALTERNATIVELY, A BENEFICIAL OWNER MAY ACCESS THE COMPANY’S ANNUAL REPORT ON FORM 10-K ON THE COMPANY’S WEBSITE AT investors.hologic.com. | IMPORTANT NOTICE REGARDING AVAILABILITY OF PROXY MATERIALS FOR THE STOCKHOLDER MEETING TO BE HELD ON MARCH 11, 2021:9, 2023: The Proxy Statement and the Hologic Annual Report on Form 10-K for the fiscal year ended September 26, 2020 and the Proxy Card24, 2022 are available at www.proxyvote.com.www.proxyvote.com. | |
TABLE OF CONTENTS HOLOGIC, INC. 20212023 Proxy Statement
Non-GAAP Reconciliation Use of Non-GAAP Financial Measures: The Company has used non-GAAP financial measures in this proxy statement, including adjusted revenue, adjusted EPS and adjusted FCF. Adjusted revenue for fiscal 20202022 and 20192021 means our consolidated revenue determined in accordance with GAAP, calculated on a constant currency basis using the foreign currency exchange rate applied in setting the Company’s fiscal 2020annual budget setestablished in the fourth quarter of fiscal 20192021 and 2018,2020, respectively. For fiscal 2020,2022, adjusted revenue excludes incremental revenue associated with the Company’s acquisition of Alpha Imaging, LLC (Alpha) and Acessa Health, Inc. (Acessa)Bolder Surgical (Bolder). For fiscal 2019,2021, adjusted revenue excludes incremental revenue associated with the Company’s acquisition of Focal Therapeutics, Inc. (Focal)Mobidiag, Biotheranostics and Grand X-Ray Imaging (Grand X-Ray).Diagenode. Adjusted EPS means our consolidated net income (loss) per share (on a fully-diluted basis) determined in accordance with GAAP, adjusted to exclude: (i) the amortization of intangible assets and impairment of goodwill, intangible assets and equipment; (ii) additional depreciation expense from acquired fixed assets and accelerated depreciation relatedadjustments to consolidation and closure of facilities;record contingent consideration at fair value; (iii) additional expenses resulting from the purchase accounting adjustment to record inventory at fair value and adjustments to contingent consideration;value; (iv) restructuring and divestiture charges and facility closure and consolidation charges, including accelerated depreciation, and costs incurred to integrate acquisitions (including retention, transaction bonuses, legal and professional consulting services) and separate divested businesses from existing operations; (v) expenses related to itsthe divested Cynosure medical aesthetics businesbusiness incurred subsequent to the disposition date primarily related to indemnification provisions for legal and tax matters; (vi) transaction related expenses for divestitures and acquisitions; (vii) third-party expenses incurred related to implementing the European MDR/IVDR requirements and obtaining the appropriate approvals for its existing productsproducts; (viii) debt extinguishment losses and related transaction costs; (ix) the unrealized (gains) losses on the mark-to-market of forward foreign currency contracts and foreign currency option contracts for which the Company has not elected hedge accounting; (x) litigation settlement charges (benefits) and non-income tax related charges (benefits); (xi) other-than-temporary impairment losses on investments and realized gains and losses resulting from the sale of investments; (xii) the one-time discrete impact of tax reform and other one-time impacts related to internal restructuringrestructurings and non-operational items; (xiii) other one-time, non-recurring, unusual or infrequent charges, expenses or gains that may not be indicative of the Company’sCompany's core business results; and (xiv) income taxes related to such adjustments. This calculation further excludes the results of Alpha and AcessaBolder post-acquisition in order to level set the results for purposes of the 20202022 STIP calculation. This calculation further excludes the results of FocalMobidiag, Biotheranostics and Grand X-RayDiagenode post-acquisition in order to level set the results for purposes of the 20192021 STIP calculation. Adjusted FCF for fiscal 20202022 and 2021 means our net cash provided by operating activities determined in accordance with GAAP less purchases of property and equipment, adjusted to exclude:exclude net payments for the following items: (i) restructuring, divestiture and facility closure and consolidation expenses and costs incurred to integrate acquisitions and separate divested businesses from existing operations; (ii) acquisition transaction expenses; (iii) contingent consideration recorded in the operating section of the cash flow statement; (iv) litigation settlements; (v) expenses(iv) certain income and non-income tax related to the divested Cynosure medical aesthetics business incurred subsequent to the disposition date;charges and (vi)refunds; and (v) the results of Alpha and AcessaBolder post-acquisition in order to level set the results for purposes of the 20202022 FCF calculation. This calculation further adds back nine monthsand the results of budgeted operating income for the divested medical aesthetics businessMobidiag, Biotheranostics, and Diagenode post-acquisition in order to level set the results for purposes of the 20202021 FCF calculation. The non-GAAP financial measures used in this proxy statement adjust for specified items that can be highly variable or difficult to predict. The Company generally uses these non-GAAP financial measures to facilitate management’s financial and operational decision-making, including evaluation of Hologic’s historical operating results, comparison to competitors’ operating results and determination of management incentive compensation. These non-GAAP financial measures reflect an additional way of viewing aspects of the company’sCompany’s operations that, when viewed with GAAP results and the reconciliations to corresponding GAAP financial measures, may provide a more complete understanding of factors and trends affecting Hologic’s business. Because non-GAAP financial measures exclude the effect of items that increase or decrease the company’sCompany’s reported results of operations, management strongly encourages investors to review the Company’s consolidated financial statements and publicly filed reports in their entirety. These non-GAAP financial measures should be considered supplemental to, and not a substitute for, financial information prepared in accordance with GAAP. The Company’s definition of these non-GAAP measures may differ from similarly titled measures used by others. A reconciliation of the non-GAAP revenue and non-GAAP EPS to the most directly comparable GAAP financial measures is included in the following pages. TABLE OF CONTENTS HOLOGIC, INC. 20212023 Proxy Statement
Reconciliation of GAAP EPS to Non-GAAP Adjusted EPS
(as calculated pursuant to the terms of the Short-Term Incentive Plan) | GAAP net (loss) income | | | 1,110.5 | | | (203.6) | | | Adjustments: | | | | | | | | | Amortization of acquired intangible assets(1) | | | 292.9 | | | 370.5 | | | Fair value write-up of acquired inventory(2) | | | 6.7 | | | 7.1 | | | Acquisition related adjustments(3) | | | 2.2 | | | 6.2 | | | Restructuring, integration/consolidation costs and MDR expenses(4) | | | 26.6 | | | 16.7 | | | Incremental depreciation expense(5) | | | — | | | 1.1 | | | Debt extinguishment loss(6) | | | — | | | 0.8 | | | Loss on sale of investments(7) | | | — | | | (0.9) | | | Unrealized (gains) losses on forward foreign currency contracts(8) | | | (3.8) | | | 2.1 | | | Debt transaction costs(9) | | | — | | | 0.8 | | | Loss from SSI(10) | | | — | | | 1.5 | | | Purchased research and development asset charges(11) | | | — | | | 4.5 | | | Impairment of intangible assets and equipment(12) | | | 30.2 | | | 685.4 | | | Litigation settlements(13) | | | 0.7 | | | 4.5 | | | Additional Cynosure related expenses(14) | | | 5.5 | | | — | | | Other non-operating charges(15) | | | (1.0) | | | — | | | Non-income tax settlement adjustment(16) | | | (2.9) | | | — | | | Discrete impact of tax reform(17) | | | — | | | 5.0 | | | Discrete tax benefit from the sale of Cynosure(18) | | | (313.4) | | | — | | | Tax benefit of internal reorganization(19) | | | — | | | (19.2) | | | Income tax effect of reconciling items(20) | | | (104.4) | | | (223.2) | | | Non-GAAP net income | | | 1,049.8 | | | 659.3 | | | Net loss attributable to non-controlling interest | | | (3.4) | | | — | | | Non-GAAP net income attributable to Hologic per Press Release | | | 1,053.2 | | | 659.3 | | | Further Adjustments for STIP: | | | | | | | | | Less: Incremental operating loss from fiscal 2019 acquisitions(21) | | | — | | | 3.0 | | | Less: Incremental operating income from fiscal 2020 acquisitions(22) | | | (5.0) | | | | | | Less: SuperSonic Imagine operating loss | | | — | | | 1.8 | | | Tax effect of adjustments(20) | | | 1.3 | | | (0.9) | | | Non-GAAP net income – STIP | | | 1,049.5 | | | 663.2 | | | Non-GAAP EPS - STIP(23) | | | 3.97 | | | 2.44 | |
GAAP net income | | | 1,302.0 | | | 1,869.7 | Adjustments: | | | | | | | Amortization of acquired intangible assets(1) | | | 340.9 | | | 318.9 | Fair value write-up of acquired inventory(2) | | | — | | | 7.9 | Acquisition related adjustments(3) | | | 1.3 | | | 21.0 | Restructuring, and integration/consolidation costs(4) | | | 7.8 | | | 23.2 | Debt extinguishment loss and transaction costs(5) | | | 2.5 | | | 27.4 | Contingent consideration adjustments(6) | | | (39.5) | | | (6.7) | Unrealized (gains) losses on forward foreign currency contracts(7) | | | (19.6) | | | 4.3 | MDR expenses(8) | | | 7.0 | | | 9.8 | Purchased research and development asset charge(9) | | | — | | | 7.0 | Impairment of acquired intangible assets(10) | | | 45.1 | | | — | Non-operating charges(11) | | | 5.6 | | | 1.8 | Non-income tax (benefits) charges(12) | | | (5.2) | | | 4.5 | Income tax reversals(14) | | | (31.8) | | | — | Income tax effect of reconciling items(13) | | | (88.2) | | | (106.4) | Non-GAAP net income | | | 1,527.9 | | | 2,182.4 | Net loss attributable to non-controlling interest | | | — | | | (1.8) | Non-GAAP net income attributable to Hologic per Press Release | | | 1,527.9 | | | 2,184.2 | Further Adjustments for STIP: | | | | | | | Less: Incremental net operating income from fiscal 2021 acquisitions(15) | | | — | | | 11.7 | Plus: Incremental net operating loss from fiscal 2022 acquisitions(16) | | | 9.8 | | | — | Tax effect of adjustments(13) | | | (2.0) | | | (2.5) | Non-GAAP net income – STIP | | | 1,535.7 | | | 2,193.4 | Non-GAAP EPS - STIP(17) | | | 6.05 | | | 8.45 |
EXPLANATORY NOTES TO RECONCILIATIONS: (1)
| To reflect non-cash expenses attributable to the amortization of acquired intangible assets. |
(2)
| To reflect the fair value step up of inventory sold during the period related to acquisitions in fiscal 2020 and fiscal 2019.2021. |
(3)
| To reflect expenses with third parties related to acquisitions and divestitures prior to when such transactions are completed. These expenses primarily comprise broker fees, legal fees, and consulting and due diligence fees. Fiscal 2019 included an adjustment to the estimated contingent consideration liabilityfees, and a transfer tax related to the Faxitron acquisition, which was payable upon Faxitron meeting defined revenue growth metrics.Mobidiag acquisition. |
(4)
| To reflect restructuring and divestiture charges, and certain costs associated with the Company’s integration and facility consolidation plans, which primarily include retention and transfer costs, as well as costs incurred to integrate acquisitions and dispose businesses, including consulting, legal, tax and accounting fees. In addition, this category includes additional expenses incurred related to the Cynosure disposition, primarily settlements of litigation and indemnification provisions for legal and tax matters that existed as of the date of disposition. |
(5)
| To reflect a debt extinguishment loss from refinancing the Credit Agreement in the first quarter of fiscal 2022 and the refinancing of the 2025 Senior Notes during fiscal 2021 and related debt issuance costs recorded directly to interest expense. |
(6)
| To reflect adjustments to the estimated contingent consideration liability related to the Acessa Health acquisition, which is payable upon meeting defined revenue growth metrics over a three-year period. |
TABLE OF CONTENTS HOLOGIC, INC. 2023 Proxy Statement
(7)
| To reflect non-cash unrealized gains and losses on the mark-to market on outstanding forward foreign currency and option contracts, which do not qualify for hedge accounting. |
(8)
| To reflect the exclusion of third-party expenses incurred to obtain compliance with the European Medical Device Regulation requirement for the Company's existing products for which it already has FDA approval and/or CE mark. |
(5)
| To reflect non-cash fair value adjustments for additional depreciation expense related to the fair value write-up of fixed assets acquired in the Gen-Probe acquisition and accelerated depreciation expense related to facility closure and business consolidation. |
(6)
| To reflect debt extinguishment losses primarily from refinancing the Company’s Credit Agreement and Senior Notes. |
(7)
| To reflect realized gains and losses on the sale of available-for-sale marketable securities and a cost method investment. |
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HOLOGIC, INC. 2021 Proxy Statement
(8)
| To reflect non-cash unrealized gains and losses on the mark-to market on outstanding forward foreign currency and option contracts, which do not qualify for hedge accounting.
|
(9)
| To reflect the amount of debt issuance costs recorded directly to interest expense as a result of the fiscal 2019 refinancing of the Company’s Credit Agreement. |
(10)
| To reflect expenses in SuperSonic Imagine’s (SSI) net loss that Hologic would exclude from its non-GAAP net income to be consistent. Hologic acquired 46% of SSI on August 1, 2019 and accounted for this investment as an equity-method investment. As such, Hologic was required to record in its statement of operations its proportionate share of SSI’s net loss for the two months ended September 28, 2019.
|
(11)
| To reflect the purchase of intangible assets in fiscal 2019 to be used in a research and development projectsproject that havehas no future alternative use. |
(12)
| For 2020, to reflect recording the Cynosure business to fair value based upon meeting the assets-held-for-sale criteria in the first quarter of fiscal 2020 due to executing an agreement to sell the business. For 2019, to reflect an intangible asset and equipment impairment charge aggregating $685.4 million related to the Medical Aesthetics reportable segment, which is comprised solely of the Cynosure business. The Company identified impairment indicators in both the second and fourth quarters of fiscal 2019 and determined the undiscounted cash flows of the asset group were not sufficient to recover the carrying value of the asset group. As such, the Company determined the fair value of the asset group and recorded an impairment charge for the difference between its fair value and carrying value. |
(13)(10)
| To reflect an impairment related to an in-process research and development project acquired in the Company’s settlements of litigation.Mobidiag acquisition and impairment charges for developed technology assets acquired in the Faxitron and Focal acquisitions. |
(14)
| To reflect additional expenses incurred related to the Cynosure disposition and indemnification provisions for legal and tax matters that existed as of the date of disposition.
|
(15)(11)
| To reflect miscellaneous non-operating charges. |
(16)(12)
| To reflect athe net impact of non-income tax settlement adjustment in the fourth quartercharges, settlements and benefits, including from a statute of fiscal 2020 as the Company settled a non-income tax issue under audit.limitations expiration, related to prior years' matters. |
(17)
| To reflect the discrete impact of tax reform to the provision for income taxes in fiscal 2019. The benefit reduction of $5.0 million recorded in the year ended September 28, 2019 was primarily related to credit utilization limitations and executive compensation deduction disallowances resulting from the completion of computations in the three months ended December 29, 2018.
|
(18)
| To reflect a discrete tax benefit from the sale of Cynosure, for which the Company recorded a long-term receivable. |
(19)
| To reflect a discrete tax benefit recorded in the year ended September 28, 2019 from the adjustment of the Company’s current and deferred tax accounts related to an internal restructuring. |
(20)(13)
| To reflect an estimated annual effective tax rate of 22.75%21.0% and 21.75%21.5% for fiscal 20202022 and 2019,2021, respectively. |
(21)(14)
| To reflect the net impact of income tax reserve releases from statute of limitation expirations and favorable audit settlements. |
(15)
| For fiscal 20192021 to determine Non-GAAP net income under the fiscal 20192021 STIP, adjusted Non-GAAP net income excludes pre-tax income (loss) generated by the FocalMobidiag, Biotheranostics and Grand X-RayDiagenode acquisitions during fiscal 2019.2021. |
(22)(16)
| For fiscal 20202022 to determine Non-GAAP net income under the fiscal 20202022 STIP, adjusted Non-GAAP net income excludes pre-tax income (loss) generated by the Alpha Imaging and Acessa Health acquisitionsBolder acquisition during fiscal 2020.2022. |
(23)(17)
| Non-GAAP earnings per share was calculated based on 264,613253,845 and 271,263259,706 weighted average diluted shares outstanding for the years ended September 26, 202024, 2022 and September 28, 2019,25, 2021, respectively. |
Reconciliation of GAAP Revenue to Adjusted Revenue
(excluding the impact of acquisitions and dispositions)
| Consolidated GAAP Revenue | | | 3,776.4 | | | 3,367.3 | | | | | | | | | Less: Incremental revenue from fiscal 2019 acquisitions | | | — | | | (11.9) | | | | | | | | | Less: Incremental revenue from fiscal 2020 acquisitions | | | (7.8) | | | — | | | | | | | | | Less: Adjustment to reduce blood screening revenue to budget | | | | | | (30.0) | | | | | | | | | FX Impact at budget rates | | | (29.0) | | | 25.7 | | | | | | | | | Adjusted Revenue | | | 3,739.6 | | | 3,351.1 | | | 388.5 | | | 11.6 | |
TABLE OF CONTENTS HOLOGIC, INC. 20212023 Proxy Statement
Reconciliation of GAAP Revenue to OrganicAdjusted Revenue
| Consolidated GAAP Revenue | | | 3,776.4 | | | 3,367.3 | | | | | | | | | Less: Medical Aesthetics revenue | | | (65.3) | | | (315.6) | | | | | | | | | Less: Blood Screening revenue | | | (43.6) | | | (58.5) | | | | | | | | | Less: Incremental revenue from SSI and Acessa | | | (22.3) | | | — | | | | | | | | | FX Impact at constant currency rates | | | (1.6) | | | — | | | | | | | | | Adjusted Revenue | | | 3,643.6 | | | 2,993.2 | | | 650.4 | | | 21.7 | |
(excluding the impact of acquisitions and dispositions) Consolidated GAAP Revenue | | | 4,862.8 | | | 5,632.3 | | | | | | | Less: Incremental revenue from fiscal 2021 acquisitions | | | — | | | (62.2) | | | | | | | Less: Incremental revenue from fiscal 2022 acquisitions | | | (9.9) | | | — | | | | | | | FX Impact at budget rates | | | 61.7 | | | (47.1) | | | | | | | Adjusted Revenue | | | 4,914.6 | | | 5,523.0 | | | (608.4) | | | (110.2) |
Reconciliation of GAAP International Revenue to Organic International Revenue | Consolidated GAAP Revenue | | | 913.2 | | | 831.3 | | | | | | | | | Less: Medical Aesthetics revenue | | | (34.4) | | | (160.2) | | | | | | | | | Less: Incremental revenue from SSI | | | (18.2) | | | — | | | | | | | | | FX Impact at constant currency | | | (1.7) | | | — | | | | | | | | | Adjusted Revenue | | | 858.9 | | | 671.1 | | | 187.8 | | | 28.0 | |
Consolidated GAAP International Revenue | | | 1,394.9 | | | 1,730.0 | | | | | | | Less: Incremental revenue from Mobidiag, Diagenode and Bolder in Fiscal 2022 and Acessa, Biotheranostics, Diagenode and Mobidiag in 2021. | | | (34.5) | | | (24.6) | | | | | | | FX Impact at constant currency | | | 78.4 | | | (100.5) | | | | | | | Organic International Revenue | | | 1,438.8 | | | 1,604.9 | | | (166.1) | | | (10.3) |
Reconciliation of GAAP International Revenue to Adjusted Constant Currency International Revenue | Consolidated GAAP International Revenue | | | 913.2 | | | 831.3 | | | 81.9 | | | 9.9 | | | FX Impact at constant currency rates | | | (1.3) | | | 34.6 | | | | | | | | | Adjusted Constant Currency International Revenue | | | 911.9 | | | 865.9 | | | 46.0 | | | 5.3 | |
Consolidated GAAP International Revenue | | | 1,394.9 | | | 1,730.0 | | | (335.1) | | | (19.4) | FX Impact at constant currency rates | | | 78.4 | | | (100.5) | | | | | | | Adjusted Constant Currency International Revenue | | | 1,473.3 | | | 1,629.5 | | | (156.2) | | | (9.6) |
Reconciliation of GAAP Net Cash Provided by Operating Activities to Adjusted Free Cash Flow GAAP Net Cash Provided by Operating Activities | | | 2,125.7 | | | 2,330.4 | Less: Purchase of property and equipment (excluding receipts from the Department of Defense) | | | (70.6) | | | (118.0) | Plus: Restructuring, divestiture, and integration/consolidation costs | | | 8.6 | | | 15.3 | Plus: Acquisition transaction expenses | | | 1.3 | | | 21.0 | Plus: Incremental net operating loss from fiscal 2022 and 2021 acquisitions | | | 9.8 | | | 9.5 | Tax effect of adjustments | | | (4.6) | | | (13.7) | Plus: Net tax payments (refunds) | | | (368.9) | | | 7.0 | Adjusted Free Cash Flow | | | 1,701.3 | | | 2,251.5 |
| (Unaudited)
(In millions, except percentages)A-4
| | | 2020
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TABLE OF CONTENTS HOLOGIC, INC. 2023 Proxy Statement
Hologic, Inc.
Amended and Restated 2008 Equity Incentive Plan
(amended as of March 914, 202318) 1. Purpose and Eligibility. The purpose of this Amended and Restated 2008 Equity Incentive Plan (the “Plan”) of HOLOGIC, INC., a Delaware corporation (the “Company”), is to provide stock options, stock issuances and other equity interests in the Company (each, an “Award”) to (a) employees, officers, directors, consultants and advisors of the Company and its Parents and Subsidiaries, and (b) any other person who is determined by the Board to have made (or is expected to make) contributions to the Company. Any person to whom an Award has been granted under the Plan is called a “Participant.” Additional definitions are contained in Section 11. 2. Administration. a. Administration by Board of Directors. The Plan will be administered by the Board of Directors of the Company (the “Board”). The Board, in its sole discretion, shall have the authority to grant and amend Awards, to adopt, amend and repeal rules relating to the Plan and to interpret and correct the provisions of the Plan and any Award. The Board shall have authority, subject to the express limitations of the Plan, (i) to construe and determine the Plan and any documentation (including electronic) relating to the Plan or Awards thereunder, (ii) to prescribe, amend and rescind rules and regulations relating to the Plan and any Awards, and to make exceptions to any such rules if the Board, in good faith, determines that it is necessary to do so in light of extraordinary circumstances and for the benefit of the Company and so as to avoid unanticipated consequences or address unanticipated events (including any temporary closure of an applicable stock exchange, disruption of communications or natural catastrophe), (iii) to determine the terms and provisions of Awards, which need not be identical, (iv) to create sub-plans hereunder necessary to comply with laws and regulations of any foreign country in which the Company may seek to grant an Award to a person eligible under Section 1, and (v) to make all other determinations in the judgment of the Board of Directors necessary or desirable for the administration and interpretation of the Plan. Notwithstanding anything in the Plan to the contrary, equity-based Awards granted under the Plan may not become exercisable, vest or be settled, in whole or in part, prior to the one-year anniversary of the date of grant, except that: (A) the Board may provide that Awards become exercisable, vest or settle prior to such date in the event of the Participant’s death or disability or in the event of a Change of Control (as defined below); and (B) annual equity grants to non-employee directors that occur in connection with the Company’s annual meeting of shareholders may vest on the date of the Company’s next annual meeting. Notwithstanding the foregoing, up to 5% of the aggregate number of shares authorized for issuance under this Plan (as described in Section 3(a)) may be issued pursuant to Awards subject to any, or no, vesting conditions, as the Board determines appropriate. The Board may, in its sole and absolute discretion, without amendment to the Plan but subject to the limitations otherwise set forth in the Plan, waive or amend the operation of Plan provisions respecting exercise after termination of Service to the Company and, except as otherwise provided herein, adjust any of the terms of any Award. The Board may correct any defect or supply any omission or reconcile any inconsistency in the Plan or in any Award in the manner and to the extent it shall deem expedient to carry the Plan or any Award into effect, and it shall be the sole and final judge of such expediency. All decisions by the Board shall be final and binding on all interested persons. Neither the Company nor any member of the Board shall be liable for any action or determination relating to the Plan. b. Appointment of Committee. To the extent permitted by applicable law, the Board may delegate any or all of its powers under the Plan to one or more committees or subcommittees of the Board (a “Committee”). If so delegated, all references in the Plan to the “Board” shall mean such Committee or the Board. The Compensation Committee of the Board of Directors is initially delegated all of the powers of the Board of Directors under the Plan, and shall continue to have such powers unless and until otherwise determined by the Board of Directors. c. Delegation. To the extent permitted by applicable law, the Board may delegate to one or more executive officers of the Company the power to grant Awards and exercise such other powers under the Plan as the Board may determine, provided that the Board shall fix the maximum number of Awards to be granted and the maximum number of shares issuable to any one Participant pursuant to Awards granted by such executive officers. No such executive officer shall ($)
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