Thompson's water seal is essentially a liquid wax ... The liquids in the product will both absorb & evaporate, leaving you a wax layer. Out of the sun & with no direct "wear or abrasion" it will last many years. This wax layer will do the same as any varnish or other top coat - water coming through from one surface will not leave through the coated surface - which is why we don't bother with Thompson's or any other product on the bottom of our decks ... the water is coming down from above, so we protect the top surface.
Most of the products (Cabot, Thompson's, TWP ... ) will say to re-treat. Some say every year, other's say 2, some say "up to 5 years." - keep in mind that those times are based on treating a deck, which gets walked on, snowed on, direct sunlight every single day, heat, freeze, furniture scooted around .... if you're treating the underside of a seat, where there is no contact with the wood by anything once it's in place, I'd say you're good for 10 years or more. The reason these products tell you to re-treat is because they treat the surface and our shoes and chair legs can rub it off, or they have a chemical that assists in preservation that has a half-life of only so long before the chemical breaks down in "the elements."