{"id":38453,"date":"2015-09-17T11:25:58","date_gmt":"2015-09-17T16:25:58","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-legal\/contracts\/uncategorized\/2005-pay-for-results-plan.html"},"modified":"2015-09-17T11:25:58","modified_gmt":"2015-09-17T16:25:58","slug":"2005-pay-for-results-plan","status":"publish","type":"corporate_contracts","link":"https:\/\/corporate.findlaw.com\/contracts\/compensation\/2005-pay-for-results-plan.html","title":{"rendered":"2005 Pay-for-Results Plan"},"content":{"rendered":"
HEWLETT-PACKARD COMPANY 2005 PAY-FOR-RESULTS\nPLAN<\/b><\/p>\n\n
 <\/p>\n\n
1.<\/b>             Purpose.  The purpose of this Plan is to provide\ncertain employees of HP and its subsidiaries with incentive compensation based\nupon the level of achievement of financial, business and other performance\ncriteria.  This Plan is intended to\npermit the payment of bonuses that may qualify as performance-based\ncompensation under Code Section 162(m).<\/p>\n\n\n\n
2.             Definitions.<\/p>\n\n\n\n
(a)           \u0093Affiliate\u0094 means (i) any\nentity that, directly or indirectly, is controlled by HP and (ii) any\nentity in which HP has a significant equity interest.<\/p>\n\n\n\n
(b)           \u0093Board\u0094 means the\nBoard of Directors of HP.<\/p>\n\n\n\n
(c)           \u0093Bonus\u0094 means a cash\npayment made pursuant to this Plan with respect to a particular Performance\nPeriod, determined pursuant to Section 8 below.<\/p>\n\n\n\n
(d)           \u0093Bonus\nFormula\u0094 means as to any Performance Period, the formula\nestablished by the Committee pursuant to Section 6 in order to determine\nthe Bonus amounts, if any, to be paid to Participants based upon the level of\nachievement of targeted goals for the selected Performance Measures. The\nformula may differ from Participant to Participant or business group to\nbusiness group.  The Bonus Formula shall\nbe of such a nature that an objective third party having knowledge of all the\nrelevant facts could determine whether targeted goals for the Performance\nMeasures have been achieved.<\/p>\n\n\n\n
(e)           \u0093Code\u0094 means the\nInternal Revenue Code of 1986, as amended.<\/p>\n\n\n\n
(f)            \u0093Committee\u0094\nmeans the HR and Compensation Committee of the Board who shall qualify\nas \u0093outside directors\u0094 within the meaning of Code Section 162(m).<\/p>\n\n\n\n
(g)           \u0093Fiscal\nYear\u0094 means the twelve-month period from November 1 through October 31.<\/p>\n\n\n\n
(h)           \u0093HP\u0094 means\nHewlett-Packard Company, a Delaware corporation.<\/p>\n\n\n\n
(i)            \u0093Participant\u0094 means a Section 16\nOfficer.<\/p>\n\n\n\n
(j)            \u0093Performance-Based\nCompensation\u0094 means compensation that qualifies as \u0093performance-based\ncompensation\u0094 within the meaning of Code Section 162(m).<\/p>\n\n\n\n
(k)           \u0093Performance\nMeasure\u0094 means any one or more of the following performance\ncriteria, either individually, alternatively or in any combination, applied to\neither HP as a whole or to a business unit, Affiliate, region, or business\nsegment, either individually, alternatively or in any combination, and measured\neither on an absolute basis or relative to a pre-established target, to a previous\nperiod\u0092s results or to a designated comparison group, in each case as specified\nby the Committee:  cash flow (including\noperating cash flow or free cash flow), revenue (on an absolute basis or\nadjusted for currency effects), gross margin, operating expenses or operating\nexpenses as a percentage of revenue, earnings (which may include earnings\nbefore interest and taxes, earnings before taxes, and net earnings, and may be\ndetermined in accordance with U.S. Generally Accepted Accounting Principles (\u0093GAAP\u0094) or adjusted to\nexclude any or all non-GAAP items), earnings per share (on a GAAP or non-GAAP\nbasis), growth in any of the foregoing measures, stock price, return on equity\nor average stockholders\u0092 equity, total stockholder return, growth in\nstockholder value relative to the moving average of the S&P 500 Index or\nanother index, return on capital, return on assets or net assets, return on\ninvestment, economic value added, operating profit, controllable operating\nprofit, or net operating profit, operating margin, cash conversion cycle, market\nshare, contract awards or backlog, overhead or other expense reduction, credit\nrating, strategic plan development and implementation, succession plan\ndevelopment and implementation, improvement in workforce diversity, customer\nindicators, new product invention or innovation, attainment of research and\ndevelopment milestones, improvements in productivity, attainment of objective\noperating goals and employee metrics.<\/p>\n\n\n\n
(l)            \u0093Performance\nPeriod\u0094 means any Fiscal Year or such other period as determined by the\nCommittee.<\/p>\n\n\n\n
(m)          \u0093Plan\u0094 means this\nHewlett-Packard Company 2005 Pay-for-Results Plan.<\/p>\n\n\n\n
(n)           \u0093Plan\nCommittee\u0094 means the committee to which the Committee\ndelegates certain authority to act on various HP compensation and benefit\nmatters.<\/p>\n\n\n\n
(o)           \u0093Predetermination\nDate\u0094 means, for a Performance Period, (i) the earlier of 90 days after\ncommencement of the Performance Period or the expiration of 25% of the\nPerformance Period, provided that the achievement of targeted goals under the selected\nPerformance Measures for the Performance Period is substantially uncertain at\nsuch time; or (ii) such other date on which a performance goal is\nconsidered to be pre-established pursuant to Code Section 162(m).<\/p>\n\n\n\n
(p)           \u0093Section 16\nOfficer\u0094 means an employee of HP or its Affiliates who is considered an\nofficer of HP within the meaning of Section 16 of the Securities Exchange\nAct of 1934, as amended, and the rules and regulations promulgated\nthereunder.<\/p>\n\n\n\n
3.             Eligibility.  The individuals eligible to participate in\nthis Plan for a given Performance Period shall be Section 16 Officers.<\/p>\n\n\n\n
4.             Plan\nAdministration.<\/p>\n\n\n\n
(a)           The Committee\nshall be responsible for the requirements for qualifying compensation as\nPerformance-Based Compensation.  Subject\nto the limitations on Committee discretion imposed under Code Section 162(m),\nthe Committee shall have such powers as may be necessary to discharge its\nduties hereunder.  The Plan Committee\nshall be responsible for the general administration and interpretation of this\nPlan and for carrying out its provisions, including the authority to construe\nand interpret the terms of this Plan, determine the manner and time of payment\nof any Bonuses, prescribe forms and procedures for purposes of Plan participation\nand distribution of Bonuses and adopt rules, regulations and to take such\nactions as it deems necessary or desirable for the proper administration of\nthis Plan. The Plan Committee may delegate its administrative tasks to HP employees\nor others as appropriate for proper administration of this Plan.<\/p>\n\n\n\n
(b)           Any rule or\ndecision by the Committee, Plan Committee or its delegate(s) that is not\ninconsistent with the provisions of this Plan shall be conclusive and binding\non all persons, and shall be given the maximum deference permitted by law.<\/p>\n\n\n\n
5.             Term.  This Plan shall be effective as of November 1,\n2005.  Notwithstanding the foregoing,\nthis Plan shall terminate unless it is approved at the next HP annual stockholders\nmeeting following the date that the Board adopts this Plan. Once approved by HP\u0092s\nstockholders, this Plan shall continue until the earlier of (i) a\ntermination under Section 9 of this Plan, (ii) the date any stockholder\napproval requirement under Code Section 162(m) ceases to be met or (iii) the\ndate that is five years after the stockholder meeting in fiscal 2006.<\/p>\n\n\n\n
6.             Bonuses.  Prior to the Predetermination Date for a\nPerformance Period, the Committee shall designate or approve in writing, the\nfollowing:<\/p>\n\n\n\n
(a)           Performance\nPeriod;<\/p>\n\n\n\n
(b)           Positions or names\nof employees who will be Participants for the Performance Period;<\/p>\n\n\n\n
(c)           Targeted goals\nfor selected Performance Measures during the Performance Period; and<\/p>\n\n\n\n
(d)           Applicable\nBonus Formula for each Participant, which may be for an individual Participant\nor a group of Participants.<\/p>\n\n\n\n
7.             Determination\nof Amount of Bonus.<\/p>\n\n\n\n
(a)           Calculation.  After the end of each Performance Period, the\nCommittee shall certify in writing (to the extent required under Code Section 162(m))\nthe extent to which the targeted goals for the Performance Measures applicable\nto each Participant for the Performance Period were achieved or exceeded. The\nBonus for each Participant shall be determined by applying the Bonus Formula to\nthe level of actual performance that has been certified by the Committee.\nNotwithstanding any contrary provision of this Plan, the Committee, in its sole\ndiscretion, may eliminate or reduce the Bonus payable to any Participant below\nthat which otherwise would be payable under the Bonus Formula.  The aggregate Bonus(es) payable to any\nParticipant during any Fiscal Year shall not exceed U.S.$10 million.<\/p>\n\n\n\n
The Committee may\nappropriately adjust any evaluation of performance under a Performance Measure\nto exclude any of the following events that occurs during a Performance Period:\n(A) the effects of currency fluctuations, (B) any or all items that\nare excluded from the calculation of non-GAAP earnings as reflected in any HP\npress release and Form 8-K filing relating to an earnings announcement, (C) asset\nwrite-downs, (D) litigation or claim judgments or settlements, (E) the\neffect of changes in tax law, accounting principles or other such laws or\nprovisions affecting reported results, (F) accruals for reorganization and\nrestructuring programs, and (G) any other extraordinary or non-operational\nitems.<\/p>\n\n\n\n
(b)           Right\nto Receive Payment.  Each Bonus\nunder this Plan shall be paid solely from general assets of HP and its\nAffiliates. This Plan is unfunded and unsecured; nothing in this Plan shall be\nconstrued to create a trust or to establish or evidence any Participant\u0092s claim\nof any right to payment of a Bonus other than as an unsecured general creditor\nwith respect to any payment to which he or she may be entitled.<\/p>\n\n\n\n
8.             Payment\nof Bonuses.<\/p>\n\n\n\n
(a)           Timing\nof Distributions. HP and its Affiliates shall distribute amounts\npayable to Participants as soon as is administratively practicable following\nthe determination and written certification of the Committee for a Performance\nPeriod, but in no event later than two and one-half months after the end of the\ncalendar year in which the Performance Period ends, except to the extent a\nParticipant has made a timely election to defer the payment of all or any\nportion of such Bonus under the Hewlett-Packard Company 2005 Executive Deferred\nCompensation Plan or any other HP approved deferred compensation plan or\narrangement.<\/p>\n\n\n\n
(b)           Payment.  The payment of a Bonus, if\nany (as determined by the Committee at the end of the Performance Period), with\nrespect to a specific Performance Period requires that the employee be an\nactive employee on HP\u0092s or its Affiliate\u0092s payroll on the last day of each\napplicable Performance Period, subject to the following:<\/p>\n\n\n\n
(i)            Leave\nof Absence or Non-Pay Status.  A Participant may receive a Bonus while on an\napproved leave of absence or non-pay status. \n\nSuch Bonus shall be prorated in a manner that HP determines in it sole\ndiscretion.<\/p>\n\n\n\n
(ii)           Disability,\nWorkforce Restructuring, Voluntary Severance Incentive Program, Divestiture or\nRetirement.  A\nParticipant who terminates due to disability, participation in a workforce\nrestructuring or voluntary severance incentive program, divestiture or\nretirement under HP\u0092s retirement policies may receive a prorated Bonus; the\nmethod in which a Bonus is prorated shall be determined by HP in its sole\ndiscretion.<\/p>\n\n\n\n
(iii)          Death.  The estate of a Participant who dies prior to\nthe end of a Performance Period or after the end of a Performance Period but\nprior to payment may receive a Bonus or prorated Bonus; the method in which a\nBonus is prorated shall be determined by HP in its sole discretion.<\/p>\n\n\n\n
(c)           Change\nin Status.  A\nParticipant who has a change in status that results in being ineligible to\nparticipate in this Plan or eligible in more than one variable pay plan,\nincluding this Plan, in a Performance Period may receive a prorated Bonus, if\nany (as determined by the Committee at the end of the Performance Period),\nunder this Plan; the method in which a Bonus is prorated shall be determined by\nHP in its sole discretion.<\/p>\n\n\n\n
(d)           Code Section 409A.  To the extent that any Bonus under the Plan\nis subject to Code Section 409A, the terms and administration of such\nBonus shall comply with the provisions of such Section, applicable IRS guidance\nand good faith reasonable interpretations thereof, and, to the extent necessary\nto achieve compliance, shall be modified, replaced, or terminated at the\ndiscretion of the Committee or Plan Committee.<\/p>\n\n\n\n
9.             Amendment\nand Termination.<\/p>\n\n\n\n
(a)           The Committee\nmay amend, modify, suspend or terminate this Plan, in whole or in part, at any\ntime, including the adoption of amendments deemed necessary or desirable to\ncorrect any defect or to supply omitted data or to reconcile any inconsistency\nin this Plan or in any Bonus granted hereunder; provided, however, that no\namendment, alteration, suspension or discontinuation shall be made which would (i) increase\nthe amount of compensation payable\npursuant to such Bonus, or (ii) cause compensation that is, or may become,\npayable hereunder to fail to qualify as Performance-Based Compensation. Notwithstanding\nthe foregoing, the Plan Committee may any amend, modify, suspend or terminate\nthis Plan if any such action is required by law.  To the extent required under applicable law,\nincluding Code Section 162(m), Plan amendments shall be subject to stockholder\napproval. At no time before the actual distribution of funds to Participants\nunder this Plan shall any Participant accrue any vested interest or right\nwhatsoever under this Plan except as otherwise stated in this Plan.<\/p>\n\n\n\n
(b)           In the case of Participants\nemployed outside the United States, HP or its Affiliate may vary the provisions\nof this Plan as deemed appropriate to conform with, as required by, or made\ndesirable by, local laws, practices and procedures.<\/p>\n\n\n\n
10.          Withholding.  Distributions pursuant to this Plan shall be\nsubject to all applicable taxes and contributions required by law to be\nwithheld in accordance with procedures established by HP.<\/p>\n\n\n\n
11.          No\nAdditional Participant Rights.  The selection of an individual for\nparticipation in this Plan shall not give such Participant any right to be\nretained in the employ of HP or any of its Affiliates, and the right of HP and\nany such Affiliate to dismiss such Participant or to terminate any arrangement\npursuant to which any such Participant provides services to HP, with or without\ncause, is specifically reserved.  No\nperson shall have claim to a Bonus under this Plan, except as otherwise\nprovided for herein, or to continued participation under this Plan.  There is no obligation for uniformity of treatment\nof Participants under this Plan.  The\nbenefits provided for Participants under this Plan shall be in addition to and\nshall in no way preclude other forms of compensation to or in respect of such\nParticipants.  It is expressly agreed and\nunderstood that the employment of a Participant is terminable at the will of\neither party and, if such Participant is a party to an employment contract with\nHP or one of its Affiliates, in accordance with the terms and conditions of the\nParticipant\u0092s employment agreement.<\/p>\n\n\n\n
12.          Successors.  All obligations of HP or its Affiliates under\nthis Plan, with respect to awards granted hereunder, shall be binding on any\nsuccessor to HP, whether the existence of such successor is the result of a\ndirect or indirect purchase, merger, consolidation, or otherwise, of all or\nsubstantially all of the business or assets of HP.<\/p>\n\n\n\n
13.          Nonassignment.  The rights of a Participant under this Plan\nshall not be assignable or transferable by the Participant except by will or\nthe laws of descent and distribution.<\/p>\n\n\n\n
14.          Severability.  If any portion of this Plan is deemed to be\nin conflict with local law, that portion of the Plan, and that portion only,\nwill be deemed void under local law.  All\nother provisions of the Plan will remain in effect.  Furthermore, if any  provision \nof this Plan would  cause  Bonuses not to  constitute Performance-Based  Compensation, that  provision \n\nshall be severed from, and shall be deemed not to be a part of, the\nPlan, but the other provisions hereof shall remain in full force and effect.<\/p>\n\n\n\n
15.          Governing\nLaw.  This Plan shall be governed by\nthe laws of the State of Delaware.<\/p>\n\n\n\n<\/pre>\n","protected":false},"template":"","meta":{"_acf_changed":false,"_stopmodifiedupdate":true,"_modified_date":"","_cloudinary_featured_overwrite":false},"corporate_contracts_companies":[7770],"corporate_contracts_industries":[9508],"corporate_contracts_types":[9539,9546],"class_list":["post-38453","corporate_contracts","type-corporate_contracts","status-publish","hentry","corporate_contracts_companies-hewlett-packard-co","corporate_contracts_industries-technology__hardware","corporate_contracts_types-compensation","corporate_contracts_types-compensation__incentive"],"acf":[],"_links":{"self":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts\/38453","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts"}],"about":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/types\/corporate_contracts"}],"wp:attachment":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/media?parent=38453"}],"wp:term":[{"taxonomy":"corporate_contracts_companies","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_companies?post=38453"},{"taxonomy":"corporate_contracts_industries","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_industries?post=38453"},{"taxonomy":"corporate_contracts_types","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_types?post=38453"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}