EXHIBIT 10.21

SEAGATE TECHNOLOGY 2004

STOCK COMPENSATION PLAN

OPTION AGREEMENT

(with acknowledgement of Compensation Recovery Policy)

THIS AGREEMENT (including any exhibits hereto, the “Agreement”) is made
effective as of the Date of Grant (as set forth in the attached Notice of Stock
Option Grant (including any exhibits thereto, the “Notice”), the terms of which
Notice are hereby made a part of this Agreement) between Seagate Technology, a
limited company incorporated in the Cayman Islands (the “Company”), and the
Participant named in the Notice.

R E C I T A L S:

WHEREAS, the Company has adopted the Seagate Technology 2004 Stock Compensation
Plan (including any exhibits thereto, the “Plan”), which Plan is incorporated
herein by reference and made a part of this Agreement. Capitalized terms not
otherwise defined herein shall have the same meanings as in the Plan; and

WHEREAS, the Committee has determined that it would be in the best interests of
the Company and its shareholders to grant the Option provided for herein to the
Participant pursuant to the Plan and the terms set forth herein and in the
Notice.

NOW THEREFORE, in consideration of the mutual covenants hereinafter set forth,
the parties agree as follows:

1. Grant of the Option. The Company hereby grants to the Participant the right
and option (the “Option”) to purchase, on the terms and conditions hereinafter
set forth, all or any part of an aggregate of that number of Shares set forth in
the Notice, subject to adjustment from time to time pursuant to the provisions
of Section 13 of the Plan. The purchase price per share of the Shares subject to
the Option (the “Option Price”) shall be the “Exercise Price (Per Share)” set
forth in the Notice, subject to adjustment from time to time pursuant to the
provisions of Section 13 of the Plan. The Option is intended to be a
non-qualified stock option, and is not intended to be treated as an option that
complies with Section 422 of the Internal Revenue Code of 1986, as amended.

2. Vesting. At any time, the portion of the Option which has become vested and
exercisable as described in this Section 2 is hereinafter referred to as the
“Vested Portion.”

(a) Vesting Schedule.

(i) Subject to Sections 2(a)(ii), 2(a)(iii), and 2(b) below, the Option shall
vest and become exercisable with respect to 25% of the Shares initially

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subject to the Option on the first anniversary of the Vesting Commencement Date
(as set forth in the Notice) and shall vest and become exercisable with respect
to an additional 1/48th of the Shares initially subject to the Option at the end
of each full month thereafter (measured by using the same day of each subsequent
month as the Vesting Commencement Date (as set forth in the Notice), or if there
is no same day in a given subsequent month, the last day of such subsequent
month).

(ii) Notwithstanding the foregoing, in the event of a Change of Control in which
the Option is not to be assumed or replaced with a substitute option which
substantially preserves both the intrinsic value (i.e., the excess of the Fair
Market Value of the Shares subject to the Option over the aggregate Option
Price) and the rights and benefits of the Option as in effect immediately prior
to such Change of Control or is not otherwise to be continued in effect by the
Company or any successor entity in the Change of Control, then the Option shall,
for at least 10 days prior to the consummation of the Change of Control, vest
and become exercisable for all the Shares at the time subject to the Option and
the Option shall terminate upon the consummation of the Change of Control.

(iii) In addition to the foregoing, in the event of the Participant’s
termination of Continuous Service with the Company on account of the
Participant’s death, the Participant shall be deemed to have completed an
additional year of service for purposes of determining the portion of the Option
which is the Vested Portion.

(b) Termination of Employment

If the Participant’s Continuous Service with the Company is terminated for any
reason, the Option shall, to the extent not then vested, be canceled by the
Company without consideration. The Vested Portion of the Option shall remain
exercisable for the period set forth in Section 3(a).

3. Exercise of Option.

(a) Period of Exercise

Subject to the provisions of the Plan and this Agreement, the Participant may
exercise all or any part of the Vested Portion of the Option at any time prior
to the earliest to occur of:

(i) the “Expiration Date” set forth in the Notice;

(ii) one year following the date of the Participant’s termination of Continuous
Service as a result of death or Disability (as defined in the Plan);

(iii) three (3) months following the date of the Participant’s termination of
Continuous Service by the Company without Cause (other than as a result of death
or Disability) or by the Participant for any reason; and

 

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(iv) the date of the Participant’s termination of Continuous Service by the
Company for Cause.

For purposes of this Agreement:

“Cause” shall mean (i) the Participant’s continued failure substantially to
perform the material duties of his office (other than as a result of total or
partial incapacity due to physical or mental illness), (ii) the embezzlement or
theft by the Participant of the Company’s property, (iii) the commission of any
act or acts on the Participant’s part resulting in the conviction of such
Participant of a felony under the laws of the United States or any state,
(iv) the Participant’s willful malfeasance or willful misconduct in connection
with the Participant’s duties to the Company or any other act or omission which
is materially injurious to the financial condition or business reputation of the
Company or any of its subsidiaries or affiliates, or (v) a material breach by
the Participant of the material terms of his employment agreement or any
non-compete, non-solicitation or confidentiality provisions to which the
Participant is subject. However, no termination shall be deemed for Cause under
clause (i), (iv) or (v) unless the Participant is first given written notice by
the Company of the specific acts or omissions which the Company deems constitute
grounds for a termination for Cause and is provided with at least 30 days after
such notice to cure the specified deficiency.

(b) Method of Exercise.

(i) Subject to Section 3(a), the Vested Portion of the Option may be exercised
by delivering to the Company at its principal office or its designee written
notice of intent to so exercise; provided that, the Option may be exercised with
respect to whole Shares only. Such notice shall specify the number of Shares for
which the Option is being exercised and shall be accompanied by payment in full
of the Option Price. The purchase price for the Shares as to which the Option is
exercised shall be paid to the Company, at the election of the Participant,
(i) in cash or by check or (ii) if there should be a public market for the
Shares at such time, (A) in Shares having a Fair Market Value equal to the
aggregate Option Price for the Shares being purchased and satisfying such other
requirements as may be imposed by the Committee; provided, that if such Shares
were acquired, directly or indirectly, from the Company, such Shares have been
held by the Participant for no less than six months (or such other period as
established from time to time by the Committee or generally accepted accounting
principles in order to avoid variable grant date accounting for financial
accounting purposes), (B) partly in cash and partly in such Shares or
(C) subject to such rules as may be established by the Committee, through the
delivery of irrevocable instruments to a broker to sell all or a portion of such
Shares and deliver promptly to the Company an amount equal to the aggregate
Option Price for the Shares being purchased. The Participant shall also be
required to pay all withholding taxes relating to the exercise.

(ii) Notwithstanding any other provision of the Plan or this Agreement to the
contrary, unless there is an available exemption from such registration,
qualification or other legal requirements, the Option may not be exercised prior
to

 

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the completion of any registration or qualification of the Option or the Shares
that is required to comply with applicable state and federal securities or any
ruling or regulation of any governmental body or national securities exchange or
compliance with any other applicable federal, state or foreign law that the
Committee shall in its sole discretion determine in good faith to be necessary
or advisable.

(iii) Upon the Company’s determination that the Option has been validly
exercised as to any of the Shares, the Company shall issue certificates in the
Participant’s name for such Shares. However, the Company shall not be liable to
the Participant for damages relating to any delays in issuing the certificates
to him, any loss of the certificates, or any mistakes or errors in the issuance
of the certificates or in the certificates themselves.

(iv) Should the Participant die while holding the Option, the Vested Portion of
the Option shall remain exercisable by the Participant’s executor or
administrator, or the person or persons to whom the Participant’s rights under
this Agreement shall pass by will, by the laws of descent and distribution, or
by beneficiary designation, as the case may be, for the period set forth in
Section 3(a). Any heir or legatee of the Participant shall take rights herein
granted subject to the terms and conditions hereof.

4. Seagate Technology Compensation Recovery for Fraud or Misconduct Policy. The
Participant hereby acknowledges and agrees that the Participant and the award
evidenced by this Agreement are subject to the Seagate Technology Compensation
Recovery for Fraud and Misconduct Policy as in effect from time to time, a
current copy of which is attached hereto as Exhibit A. To the extent the
Participant is subject to the policy, the terms and conditions of the policy are
hereby incorporated by reference into this Agreement.

5. No Right to Continued Employment. Neither the Plan nor this Agreement shall
be construed as giving the Participant the right to be retained in the employ
of, or in any consulting relationship to, the Company or any Affiliate. Further,
the Company or an Affiliate may at any time dismiss the Participant or
discontinue any consulting relationship, free from any liability or any claim
under the Plan or this Agreement, except as otherwise expressly provided herein.

6. Transferability. The Option is exercisable only by the Participant during the
Participant’s lifetime and may not be assigned, alienated, pledged, attached,
sold or otherwise transferred or encumbered by the Participant otherwise than by
will or by the laws of descent and distribution, and any such purported
assignment, alienation, pledge, attachment, sale, transfer or encumbrance shall
be void and unenforceable against the Company or any Affiliate; provided that
the designation of a beneficiary shall not constitute an assignment, alienation,
pledge, attachment, sale, transfer or encumbrance.

7. Withholding. A Participant shall be required to pay to the Company or any
Affiliate and the Company shall have the right and is hereby authorized to
withhold, any applicable withholding taxes in respect of an Option, its exercise
or any payment or transfer under an Option or under the Plan and to take such
other action as may be necessary in the opinion of the Company to satisfy all
obligations for the payment of such withholding taxes.

 

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8. Securities Laws. Upon the acquisition of any Shares pursuant to the exercise
of the Option, the Participant will make or enter into such written
representations, warranties and agreements as the Committee may reasonably
request in order to comply with applicable securities laws or with this
Agreement.

9. Notices. Any notice necessary under this Agreement shall be addressed to the
Company in care of its Secretary at the principal executive office of the
Company and to the Participant at the address appearing in the personnel records
of the Company for the Participant or to either party at such other address as
either party hereto may hereafter designate in writing to the other. Any such
notice shall be deemed effective upon receipt thereof by the addressee.

10. Choice of Law. THE INTERPRETATION, PERFORMANCE AND ENFORCEMENT OF THIS
AGREEMENT SHALL BE GOVERNED BY THE LAWS OF THE STATE OF CALIFORNIA WITHOUT
REGARD TO PRINCIPLES OF CONFLICTS OF LAW.

11. Option Subject to Plan. By entering into this Agreement the Participant
agrees and acknowledges that the Participant has received a copy of the Plan.
The Option is subject to the Plan. The terms and provisions of the Plan, as it
may be amended from time to time in accordance with its respective terms, are
hereby incorporated herein by reference. The Participant acknowledges that the
Notice, this Agreement and the Plan set forth the entire understanding between
the Participant and the Company regarding the Participant’s rights to acquire
the Shares subject to this Option and supersede all prior oral and written
agreements with respect thereto, including, but not limited to, any other
agreement or underwriting between the Participant and the Company or an
Affiliate relating to the Participant’s employment, consulting relationship, or
directorship, and any termination thereof, his compensation, or his rights,
claims or interests in or to shares of the capital stock of the Company. In the
event of a conflict between any term or provision contained herein and a term or
provision of the Plan, the applicable terms and provisions of the Plan will
govern and prevail.

12. Amendments. The Committee at any time, and from time to time, may amend the
terms of the Option; provided, however, that the rights under any Option shall
not be materially impaired by any such amendment unless (i) the Company requests
the consent of the Participant and (ii) the Participant consents in writing.

 

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EXHIBIT A

SEAGATE TECHNOLOGY COMPENSATION RECOVERY FOR FRAUD OR MISCONDUCT

POLICY

Effective January 29, 2009

The Seagate Technology Compensation Recovery for Fraud or Misconduct Policy is
intended to support accurate disclosure by recovering compensation paid to an
executive covered by this policy where such compensation was based on
incorrectly reported financial results due to the fraud or willful misconduct of
the executive who received such compensation.

Employees Covered:

“Executive” is defined as U.S. employees of Seagate Technology or one of its
subsidiaries (the “Company”) at the Senior Vice President level or above and any
other officers subject to Section 16 of the Securities Exchange Act of 1934, as
amended.

Compensation Covered:

The repayment and other obligations of an Executive described in this policy
apply to any bonus paid, stock grant issued (whether or not vested) and/or
vested during the covered period, or stock option exercised during the covered
period, defined as the period commencing with the later of the effective date of
this policy or the date that is four years prior to beginning of the fiscal year
in which a restatement is announced and ending on the date recovery is sought
pursuant to this policy; provided, however, that in no event shall this policy
apply to any stock or option award granted before the effective date of this
policy.

Fraud or Misconduct:

For the purposes of this policy, “Fraud” or “Misconduct” shall mean any of the
following events that are significant contributing factors to a restatement of
the Company’s financial results, as determined pursuant to “Determination of
Fraud or Misconduct”, below: (A) embezzlement or theft by the Executive, (B) the
commission of any act or acts on the Executive’s part resulting in the
conviction (or plea of guilty or nolo contendere) of such Executive of a felony
under the laws of the United States or any state (or equivalent law of any
jurisdiction outside of the United States), (C) Executive’s willful malfeasance
or willful misconduct in connection with Executive’s financial reporting
obligations for the Company, or (D) Executive’s other misrepresentation, act, or
omission which is materially injurious to the Company’s financial reporting
obligations.

Recovery Event:

A recovery event occurs when:

 

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The Company issues a restatement of financial results, and

 

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The independent members of the Board of Directors determine in good faith that
the Fraud or Misconduct of an Executive covered by this policy was a significant
contributing factor to such restatement, and

 

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  •  

During the covered period, (i) some or all of a bonus previously paid or
performance-based stock grant that vested prior to such restatement, in either
case, having a value of at least $100,000, would not have been paid or become
vested, as applicable, based upon the restated financial results, (ii) the
Executive exercised one or more stock options, sold the Company’s common shares
acquired upon such exercises and in the aggregate realized proceeds of at least
$100,000 or (iii) the Executive sold the Company’s common shares attributable to
one or more non-performance-based stock grants and in the aggregate realized
proceeds of at least $100,000.

Determination of Fraud or Misconduct:

The determination of whether an Executive’s Fraud or Misconduct was a
significant contributing factor to the Company’s restatement of financial
results shall only be made by the affirmative vote of a majority of all of the
independent members of the Board at an in-person meeting of the independent
members of the Board called and held for such purpose (after reasonable notice
is provided to the Executive and the Executive, with or without legal counsel,
is given an opportunity to be heard at such meeting). Any determination by the
Board pursuant to this policy shall be subject to the Executive’s right to
review by an arbitrator pursuant to procedures set forth in the Seagate
Executive Severance and Change of Control Plan, a copy of which is attached
hereto.

Repayment Obligation:

Upon receiving from the Company the revised calculations and determination of
the independent members of the Board of Directors setting forth the amount of a
previously paid bonus or bonuses that would not have been paid and/or a
performance-based stock grant or grants that would not have vested, in all cases
based upon the restated financial results, and/or the proceeds of sales of
shares acquired upon the exercise of stock options or following the vesting of
any non-performance-based stock grants, the affected Executive will be required
to deliver, within 30 days of such written notification of the amount due, to
the Company an amount in equal to: (i) the bonus payments that would not have
been made during the covered period had the restated financial results been used
to determine such bonus awards; (ii) with respect to a performance-based stock
grant that was issued and/or vested during the covered period, an amount in cash
or equivalent value in the Company’s common shares (or a combination of the two)
equal to the net proceeds realized by the Executive upon the issuance and, if
applicable, subsequent sale of any stock that would not have been issued or
vested based upon the restated financial results; (iii) with respect to any
stock option that was exercised during the covered period, an amount in cash
equal to the net proceeds realized by the Executive upon the sale during the
covered period of some or all of the stock acquired upon the exercise of such
stock option; and (iv) with respect to the sale of shares following the vesting
of any non-performance-based stock grant, an amount in cash determined by the
independent members of the Board of Directors to be attributable to the
Executive’s Fraud or Misconduct. The Executive shall also immediately comply
with any instructions delivered by the Company with respect to any of the
Company’s common shares that have not yet been sold or otherwise disposed of and
would not have been issued or vested based upon the restated financial results.
For this purpose, “net proceeds” shall be net of any brokerage commissions and
amounts paid to the Company to satisfy the aggregate exercise price and/or tax
withholding obligations paid in respect of the award. With respect to amounts to
be paid in cash, the form of payment may be a certified cashier check, money
transfer, or other method as approved by the Board of Directors.

Other Terms:

The Company shall be able to enforce the repayment obligation described in this
policy by all legal means available, including, without limitation, by
withholding such amount from other sums owed to the affected Executive.

 

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