Exhibit 10(a)

 

HEWLETT–PACKARD COMPANY 2000 STOCK PLAN

 

 

1.  PURPOSES OF THE PLAN.

 

The purpose of this Plan is to encourage ownership in the Company by key
personnel whose long–term employment is considered essential to the Company’s
continued progress and, thereby, encourage recipients to act in the shareowner’s
interest and share in the Company’s success.

 

2.  DEFINITIONS.

 

As used herein, the following definitions shall apply:

 

(a)                                  “Administrator” means the Board or any of
its Committees as shall be administering the Plan, in accordance with Section 4
of the Plan.

 

(b)                                 “Affiliate” means any entity that is
directly or indirectly controlled by the Company or any entity in which the
Company has a significant ownership interest as determined by the Administrator.

 

(c)                                  “Applicable Laws” means the requirements
relating to the administration of stock option plans under U.S. federal and
state laws, any stock exchange or quotation system on which the Common Stock is
listed or quoted and the applicable laws of any foreign jurisdiction where
Awards are, or will be, granted under the Plan.

 

(d)                                 “Award” means a Cash Award, Stock Award, or
Option granted in accordance with the terms of the Plan.

 

(e)                                  “Awardee” means the holder of an
outstanding Award.

 

(f)                                    “Award Agreement” means a written or
electronic agreement between the Company and an Awardee evidencing the terms and
conditions of an individual Award. The Award Agreement is subject to the terms
and conditions of the Plan.

 

(g)                                 “Board” means the Board of Directors of the
Company.

 

(h)                                 “Cash Awards” means cash awards granted
pursuant to Section 12 of the Plan.

 

(i)                                     “Code” means the United States Internal
Revenue Code of 1986, as amended.

 

 

1

--------------------------------------------------------------------------------

 

(j)                                     “Committee” means a committee of
Directors appointed by the Board in accordance with Section 4 of the Plan.

 

(k)                                  “Common Stock” means the common stock of
the Company.

 

(l)                                     “Company” means Hewlett–Packard Company,
a Delaware corporation.

 

(m)                               “Consultant” means any person, including an
advisor, engaged by the Company or a Subsidiary to render services to such
entity or any person who is an advisor, director or consultant of an Affiliate.

 

(n)                                 “Director” means a member of the Board.

 

(o)                                 “Employee” means a regular employee of the
Company, any Subsidiary or any Affiliate, including Officers and Directors, who
is treated as an employee in the personnel records of the Company or its
Subsidiary for the relevant period, but shall exclude individuals who are
classified by the Company or its Subsidiary as (A) leased from or otherwise
employed by a third party; (B) independent contractors; or (C) intermittent or
temporary, even if any such classification is changed retroactively as a result
of an audit, litigation or otherwise. An Awardee shall not cease to be an
Employee in the case of (i) any leave of absence approved by the Company or its
Subsidiary or (ii) transfers between locations of the Company or between the
Company, any Subsidiary, or any successor. Should an Awardee transfer from the
Company to Agilent Technologies, Inc. prior to the Distribution Date (as defined
in Section 1.20 of the Employees Matter Agreement between Agilent
Technologies, Inc. and the Company), the Awardee will cease to be an Employee at
the time of such transfer. Neither service as a Director nor payment of a
director’s fee by the Company shall be sufficient to constitute “employment” by
the Company.

 

(p)                                 “Exchange Act” means the Securities Exchange
Act of 1934, as amended.

 

(q)                                 “Fair Market Value” means, as of any date,
the average of the highest and lowest quoted sales prices for such Common Stock
as of such date (or if no sales were reported on such date, the average on the
last preceding day a sale was made) as quoted on the stock exchange or a
national market system, with the highest trading volume, as reported in such
source as the Administrator shall determine.

 

(r)                                    “Grant Date” means the date selected by
the Administrator, from time to time, upon which Awards are granted to
Participants pursuant to this Plan.

 

(s)                                  “Incentive Stock Option” means an Option
intended to qualify as an incentive stock option within the meaning of
Section 422 of the Code and the regulations promulgated thereunder.

 

2

--------------------------------------------------------------------------------

 

(t)                                    “Nonstatutory Stock Option” means an
Option not intended to qualify as an Incentive Stock Option.

 

(u)                                 “Officer” means a person who is an officer
of the Company within the meaning of Section 16 of the Exchange Act and the
rules and regulations promulgated thereunder.

 

(v)                                 “Option” means a stock option granted
pursuant to the Plan. Options granted under the Plan may be Incentive Stock
Options or Nonstatutory Stock Options.

 

(w)                               “Participant” means an Employee, Director or
Consultant.

 

(x)                                   “Plan” means this 2000 Stock Plan.

 

(y)                                 “Restricted Stock” means shares of Common
Stock acquired pursuant to a grant of a Stock Award under Section 11 of the
Plan.

 

(z)                                   “Share” means a share of the Common Stock,
as adjusted in accordance with Section 14 of the Plan.

 

(aa)                            “Stock Awards” means right to purchase or
receive Common Stock pursuant to Section 11 of the Plan.

 

(bb)                          “Subsidiary” means a “subsidiary corporation,”
whether now or hereafter existing, as defined in Section 424(f) of the Code.

 

3.  STOCK SUBJECT TO THE PLAN.

 

Subject to the provisions of Section 14 and Section  6(d) of the Plan, the
maximum aggregate number of Shares that may be issued under the Plan is
250,000,000 Shares. The Shares may be authorized, but unissued, or reacquired
Common Stock. Preferred stock may be issued in lieu of Common Stock for Awards.

 

If an Award expires or becomes unexercisable without having been exercised in
full, the unpurchased Shares which were subject thereto, if any, shall become
available for future grant or sale under the Plan (unless the Plan has
terminated). Shares of Restricted Stock that are either forfeited or repurchased
by the Company at their original purchase price shall become available for
future grant or sale under the Plan. Shares that are tendered, whether by
physical delivery or by attestation, to the Company by the Awardee as full or
partial payment of the exercise price of any Award or in payment of any
applicable withholding for federal, state, city, local or foreign taxes incurred
in connection with the exercise of any Award shall become available for future
grant or sale under the Plan; provided, however, that the total number of Shares
so tendered from which Incentive Stock Options may be granted shall not exceed
250,000,000.

 

3

--------------------------------------------------------------------------------

 

4.  ADMINISTRATION OF THE PLAN.

 

(a)           Procedure.

 

(i)                                     Multiple Administrative Bodies. The Plan
may be administered by different Committees with respect to different groups of
Participants.

 

(ii)                                  Section 162. To the extent that the
Administrator determines it to be desirable to qualify Awards granted hereunder
as “performance–based compensation” within the meaning of Section 162(m) of the
Code, the Plan shall be administered by a Committee of two or more “outside
directors” within the meaning of Section 162(m) of the Code.

 

(iii)                               Rule 16–3. To the extent desirable to
qualify transactions hereunder as exempt under Rule 16b–3 promulgated under the
Exchange Act (“Rule 16b–3”), the transactions contemplated hereunder shall be
structured to satisfy the requirements for exemption under Rule 16b–3.

 

(iv)                              Other Administration. The Board may delegate
to the Executive Committee of the Board (the “Executive Committee”) the power to
approve Awards to Participants who are not (A) subject to Section 16 of the
Exchange Act or (B) at the time of such approval, “covered employees” under
Section 162(m) of the Code.

 

(v)                                 Delegation of Authority for the Day-to-Day
Administration of the Plan.  Except to the extent prohibited by applicable law
or applicable rules of a stock exchange, the Board or any of its committees as
shall be administering the Plan may delegate to one or more individuals the
day-to-day administration of the Plan and any of the functions assigned to it in
this Plan. The delegation may be revoked at any time.

 

(b)                                 Powers of the Administrator. Subject to the
provisions of the Plan, and in the case of a Committee, subject to the specific
duties delegated by the Board to such Committee, the Administrator shall have
the authority, in its discretion:

 

(i)                                     to select the Participants to whom
Awards may be granted hereunder;

 

(ii)                                  to determine the number of shares of
Common Stock to be covered by each Award granted hereunder;

 

 

4

--------------------------------------------------------------------------------

 

(iii)                               to approve forms of agreement for use under
the Plan;

 

(iv)                              to determine the terms and conditions, not
inconsistent with the terms of the Plan, of any Award granted hereunder. Such
terms and conditions include, but are not limited to, the exercise price, the
time or times when an Award may be exercised (which may or may not be based on
performance criteria), any vesting acceleration or waiver of forfeiture
restrictions, and any restriction or limitation regarding any Award or the
Shares relating thereto, based in each case on such factors as the
Administrator, in its sole discretion, shall determine;

 

(v)                                 to construe and interpret the terms of the
Plan and Awards granted pursuant to the Plan;

 

(vi)                              to adopt rules and procedures relating to the
operation and administration of the Plan to accommodate the specific
requirements of local laws and procedures. Without limiting the generality of
the foregoing, the Administrator is specifically authorized (A) to adopt the
rules and procedures regarding the conversion of local currency, withholding
procedures and handling of stock certificates which vary with local
requirements, (B) to adopt sub–plans and Plan addenda as the Administrator deems
desirable, to accommodate foreign tax laws, regulations and practice;

 

(vii)                           to prescribe, amend and rescind rules and
regulations relating to the Plan, including rules and regulations relating to
sub–plans and Plan addenda;

 

(viii)                        to modify or amend each Award, including the
discretionary authority to extend the post–termination exercisability period of
Options longer than is otherwise provided for in the Plan, provided, however,
that any such amendment is subject to Section 15(c) of the Plan and may not
impair any outstanding Award unless agreed to in writing by the Awardee;

 

(ix)                                to allow Awardees to satisfy withholding tax
obligations by electing to have the Company withhold from the Shares to be
issued upon exercise of an Award that number of Shares having a Fair Market
Value equal to the amount required to be withheld. The Fair Market Value of the
Shares to be withheld shall be determined on the date that the amount of tax to
be withheld is to be determined. All elections by an Awardee to have Shares
withheld for this purpose shall be made in such form and under such conditions
as the Administrator may deem necessary or advisable;

 

5

--------------------------------------------------------------------------------

 

(x)                                   to authorize conversion or substitution
under the Plan of any or all outstanding stock options or outstanding stock
appreciation rights held by service providers of an entity acquired by the
Company (the “Conversion Options”). Any conversion or substitution shall be
effective as of the close of the merger or acquisition. The Conversion Options
may be Nonstatutory Stock Options or Incentive Stock Options, as determined by
the Administrator; provided, however, that with respect to the conversion of
stock appreciation rights in the acquired entity, the Conversion Options shall
be Nonstatutory Stock Options. Unless otherwise determined by the Administrator
at the time of conversion or substitution, all Conversion Options shall have the
same terms and conditions as Options generally granted by the Company under the
Plan;

 

(xi)                                to authorize any person to execute on behalf
of the Company any instrument required to effect the grant of an Award
previously granted by the Administrator;

 

(xii)                             to make all other determinations deemed
necessary or advisable for administering the Plan and any Award granted
hereunder.

 

(c)                                  Effect of Administrator’s Decision. The
Administrator’s decisions, determinations and interpretations shall be final and
binding on all Awardees.

 

5.  ELIGIBILITY.

 

Awards may be granted to Participants, provided, however, that Incentive Stock
Options may be granted only to Employees of the Company or any Subsidiary.

 

6.  LIMITATIONS.

 

(a)                                  Each Option shall be designated in the
Award Agreement as either an Incentive Stock Option or a Nonstatutory Stock
Option. However, notwithstanding such designation, to the extent that the
aggregate Fair Market Value of the Shares with respect to which Incentive Stock
Options are exercisable for the first time by the Awardee during any calendar
year (under all plans of the Company and any Subsidiary) exceeds $100,000, such
Options shall be treated as Nonstatutory Stock Options. For purposes of this
Section 6(a), Incentive Stock Options shall be taken into account in the order
in which they were granted. The Fair Market Value of the Shares shall be
determined as of the time the Option with respect to such Shares is granted.

 

 

6

--------------------------------------------------------------------------------

 

 

(b)                                 For purposes of Incentive Stock Options, no
leave of absence may exceed ninety (90) days, unless reemployment upon
expiration of such leave is guaranteed by statute or contract. If reemployment
upon expiration of a leave of absence approved by the Company is not so
guaranteed, on the 91st day of such leave an Awardee’s employment with the
Company shall be deemed terminated for Incentive Stock Option purposes and any
Incentive Stock Option held by the Awardee shall cease to be treated as an
Incentive Stock Option and shall be treated for tax purposes as a Nonstatutory
Stock Option three (3) months thereafter.

 

(c)                                  No Participant shall have any claim or
right to be granted an Award and the grant of any Award shall not be construed
as giving a Participant the right to continue in the employ of the Company, its
Subsidiaries or Affiliates. Further, the Company, its Subsidiaries and
Affiliates expressly reserve the right, at any time, to dismiss a Participant at
any time without liability or any claim under the Plan, except as provided
herein or in any Award Agreement entered into hereunder.

 

(d)                                 The following limitations shall apply to
grants of Awards:

 

(i)                                     No Participant shall be granted, in any
fiscal year of the Company, Options to purchase more than 10,000,000 Shares.

 

(ii)                                  In connection with his or her initial
service, a Participant may be granted Options to purchase up to an additional
10,000,000 Shares which shall not count against the limit set forth in
subsection (i) above.

 

(iii)                               If an Option is cancelled in the same fiscal
year of the Company in which it was granted (other than in connection with a
transaction described in Section 14), the cancelled Option will be counted
against the limits set forth in subsections (i) and (ii) above.

 

(iv)                              The maximum aggregate number of Shares
underlying Stock Awards that may be granted under this Plan is twenty million
(20,000,000) Shares.

 

(v)                                 The maximum aggregate number of Shares
underlying Non–Statutory Stock Options with an exercise price of less than Fair
Market Value on the Grant Date that may be granted under Section 9(a)(ii) of
this Plan is thirty million (30,000,000) Shares.

 

(vi)                              The foregoing limitations shall be adjusted
proportionately in connection with any change in the Company’s capitalization as
described in Section 14.

 

7

--------------------------------------------------------------------------------

 

7.  TERM OF PLAN.

 

Subject to Section 20 of the Plan, the Plan shall become effective upon its
adoption by the Board. It shall continue in effect for a term of ten (10) years
from the later of the date the Plan or any amendment to add shares to the Plan
is adopted by the Board unless terminated earlier under Section 15 of the Plan.

 

8.  TERM OF AWARD.

 

The term of each Award shall be determined by the Administrator and stated in
the Award Agreement. In the case of an Option, the term shall be ten (10) years
from the Grant Date or such shorter term as may be provided in the Award
Agreement; provided that the term may be 10 1/2 years in certain jurisdictions
outside the United States as determined by the Administrator.

 

9.  OPTION EXERCISE PRICE AND CONSIDERATION.

 

(a)                                  Exercise Price. The per share exercise
price for the Shares to be issued pursuant to exercise of an Option shall be
determined by the Administrator, subject to the following:

 

(i)                                     In the case of an Incentive Stock Option
the per Share exercise price shall be no less than 100% of the Fair Market Value
per Share on the Grant Date.

 

(ii)                                  In the case of a Nonstatutory Stock
Option, the per Share exercise price shall be no less than seventy–five percent
(75%) of the Fair Market Value per Share on the Grant Date. In the case of a
Nonstatutory Stock Option intended to qualify as “performance–based
compensation” within the meaning of Section 162(m) of the Code, the per Share
exercise price shall be no less than 100% of the Fair Market Value per Share on
the Grant Date.

 

(iii)                               Notwithstanding the foregoing, at the
Administrator’s discretion, Conversion Options (as defined in Section 4(b)(x))
may be granted with a per Share exercise price of less than 100% of the Fair
Market Value per Share on the Grant Date and shall not be subject to the
provisions of Section 6(d)(v) above.

 

(iv)                              Other than in connection with a change in the
Company’s capitalization (as described in Section 14(a)), Options may not be
repriced, replaced, regranted through cancellation or modified without
shareowner approval if the effect of such repricing, replacement, regrant or
modification would be to reduce the exercise price of such Incentive Stock
Options or Nonstatutory Stock Options.

 

8

--------------------------------------------------------------------------------

 

(b)                                 Vesting Period and Exercise Dates.  At the
time an Option is granted, the Administrator shall fix the period within which
the Option may be exercised and shall determine any conditions that must be
satisfied before the Option may be exercised.

 

(c)                                  Form of Consideration.  The Administrator
shall determine the acceptable form of consideration for exercising an Option,
including the method of payment. In the case of an Incentive Stock Option, the
Administrator shall determine the acceptable form of consideration at the Grant
Date. Acceptable forms of consideration may include:

 

(i)                                     cash;

 

(ii)                                  check or wire transfer (denominated in
U.S. Dollars);

 

(iii)                               other Shares which (A) in the case of Shares
acquired upon exercise of an Option, have been owned by the Awardee for more
than six months on the date of surrender, and (B) have a Fair Market Value on
the date of surrender equal to the aggregate exercise price of the Shares as to
which said Option shall be exercised;

 

(iv)                              consideration received by the Company under a
cashless exercise program implemented by the Company in connection with the
Plan;

 

(v)                                 any combination of the foregoing methods of
payment; or

 

(vi)                              such other consideration and method of payment
for the issuance of Shares to the extent permitted by Applicable Laws.

 

10.  EXERCISE OF OPTION.

 

(a)                                  Procedure for Exercise; Rights as a
Shareowner. Any Option granted hereunder shall be exercisable according to the
terms of the Plan and at such times and under such conditions as determined by
the Administrator and set forth in the respective Award Agreement. No Option may
be exercised during any leave of absence other than an approved personal or
medical leave with an employment guarantee upon return. An Option shall continue
to vest during any authorized leave of absence and such Option may be exercised
to the extent vested upon the Awardee’s return to active employment status. An
Option may not be exercised for a fraction of a Share.

 

An Option shall be deemed exercised when the Company receives (i) written or
electronic notice of exercise (in accordance with the Award Agreement) from the
person entitled to exercise the Option; (ii) full

 

 

9

--------------------------------------------------------------------------------

 

payment for the Shares with respect to which the related Option is exercised;
and (iii) with respect to Nonstatutory Stock Options, payment of all applicable
withholding taxes due upon such exercise.

 

Shares issued upon exercise of an Option shall be issued in the name of the
Awardee or, if requested by the Awardee, in the name of the Awardee and his or
her spouse. Until the Shares are issued (as evidenced by the appropriate entry
on the books of the Company or of a duly authorized transfer agent of the
Company), no right to vote or receive dividends or any other rights as a
shareowner shall exist with respect to the Shares subject to an Option,
notwithstanding the exercise of the Option. The Company shall issue (or cause to
be issued) such Shares promptly after the Option is exercised. No adjustment
will be made for a dividend or other right for which the record date is prior to
the date the Shares are issued, except as provided in Section 14 of the Plan.

 

Exercising an Option in any manner shall decrease the number of Shares
thereafter available, both for purposes of the Plan and for sale under the
Option, by the number of Shares as to which the Option is exercised.

 

(b)                                 Termination of Employment. Unless otherwise
provided for by the Administrator in the Award Agreement, if an Awardee ceases
to be an Employee, other than as a result of circumstances described in
Sections 10(c), (d), (e) and (f) below, the Awardee’s Option, whether vested or
unvested, shall terminate immediately upon the Awardee’s termination. On the
date of the Awardee’s termination of employment, the Shares covered by the
unvested portion of his or her Option shall revert to the Plan. If, prior to
termination of employment, the Awardee does not exercise his or her vested
Option, the Option shall terminate, and the Shares covered by such Option shall
revert to the Plan.

 

(c)                                  Disability or Retirement of Awardee. Unless
otherwise provided for by the Administrator in the Award Agreement, if an
Awardee ceases to be an Employee as a result of the Awardee’s total and
permanent disability or retirement due to age, in accordance with the Company’s
or its Subsidiaries’ retirement policy, all unvested Options shall immediately
vest and the Awardee may exercise his or her Option within three (3) years of
the date of such disability or retirement for a Nonstatutory Stock Option;
within three (3) months of the date of such disability or retirement for an
Incentive Stock Option; or if earlier, the expiration of the term of such
Option. If the Awardee does not exercise his or her Option within the time
specified herein, the Option shall terminate, and the Shares covered by such
Option shall revert to the Plan.

 

(d)                                 Death of Awardee. Unless otherwise provided
for by the Administrator in the Award Agreement, if an Awardee dies while an
Employee, all unvested

 

10

--------------------------------------------------------------------------------

 

Options shall immediately vest and all Options may be exercised for one (1) year
following the Awardee’s death. The Option may be exercised by the beneficiary
designated by the Awardee (as provided in Section 16), the executor or
administrator of the Awardee’s estate or, if none, by the person(s) entitled to
exercise the Option under the Awardee’s will or the laws of descent or
distribution. If the Option is not so exercised within the time specified
herein, the Option shall terminate, and the Shares covered by such Option shall
revert to the Plan.

 

(e)                                  Voluntary Severance Incentive Program. If
an Awardee ceases to be an Employee as a result of participation in the
Company’s or its Subsidiaries’ voluntary severance incentive program approved by
the Board or Executive Committee, all unvested Options shall immediately vest
and all outstanding Options shall be exercisable for three (3) months following
the Awardee’s termination (or such other period of time as provided for by the
Administrator) or, if earlier, the expiration of the term of such Option. If,
after termination, of Awardee’s employment the Awardee does not exercise his or
her Option within the time specified herein, the Option shall terminate, and the
Shares covered by such Option shall revert to the Plan.

 

(f)                                    Divestiture. If an Employee ceases to be
a Participant because of a divestiture of the Company, the Administrator may, in
its sole discretion, make such Employee’s outstanding Options fully vested and
exercisable and provide that such Options remain exercisable for a period of
time to be determined by the Administrator. The determination of whether a
divestiture will occur shall be made by the Administrator in its sole
discretion. If, after the close of the divestiture, the Awardee does not
exercise his or her Option within the time specified therein, the Option shall
terminate and the shares covered by such Option shall revert to the Plan.

 

(g)                                 Buyout Provisions. At any time, the
Administrator may, but shall not be required to, authorize the Company to offer
to buy out for a payment in cash or Shares an Award previously granted based on
such terms and conditions as the Administrator shall establish and communicate
to the Awardee in connection with such offer.

 

11.  STOCK AWARDS.

 

(a)                                  General. Stock Awards may be issued either
alone, in addition to, or in tandem with other Awards granted under the Plan.
After the Administrator determines that it will offer a Stock Award under the
Plan, it shall advise the Awardee in writing or electronically, by means of an
Award Agreement, of the terms, conditions and restrictions related to the offer,
including the number of Shares that the Awardee shall be entitled to receive or
purchase, the price to be paid, if any, and, if applicable, the time within
which the Awardee must accept such offer. The offer shall be accepted by
execution

 

 

11

--------------------------------------------------------------------------------

 

of an Award Agreement in the form determined by the Administrator. The
Administrator will require that all shares subject to a right of repurchase or
forfeiture be held in escrow until such repurchase right or risk of forfeiture
lapses.

 

(b)                                 Forfeiture. Unless the Administrator
determines otherwise, the Award Agreement shall provide for the forfeiture of
the unvested Restricted Stock upon the Awardee ceasing to be an Employee except
as provided below in Sections 11(c), (d) and (e). To the extent that the Awardee
purchased the Restricted Stock, the Company shall have a right to repurchase the
unvested Restricted Stock at the original price paid by the Awardee upon Awardee
ceasing to be a Participant for any reason, except as provided below in
Sections 11(c), (d) and (e).

 

(c)                                  Disability or Retirement of Awardee. Unless
otherwise provided for by the Administrator in the Award Agreement, if an
Awardee ceases to be an Employee as a result of the Awardee’s total and
permanent disability or retirement due to age, in accordance with the Company’s
or its Subsidiaries’ retirement policy, the Award shall continue to vest,
provided the following conditions are met:

 

(i)                                     The Awardee shall not render services
for any organization or engage directly or indirectly in any business which, in
the opinion of the Administrator, competes with, or is in conflict with the
interest of, the Company. The Awardee shall be free, however, to purchase as an
investment or otherwise stock or other securities of such organizations as long
as they are listed upon a recognized securities exchange or traded
over–the–counter, or as long as such investment does not represent a substantial
investment to the Awardee or a significant (greater than 10%) interest in the
particular organization. For the purposes of this subsection, a company (other
than a Subsidiary) which is engaged in the business of producing, leasing or
selling products or providing services of the type now or at any time hereafter
made or provided by the Company shall be deemed to compete with the Company;

 

(ii)                                  The Awardee shall not, without prior
written authorization from the Company, use in other than the Company’s
business, any confidential information or material relating to the business of
the Company, either during or after employment with the Company;

 

(iii)                               The Awardee shall disclose promptly and
assign to the Company all right, title and interest in any invention or idea,
patentable or not, made or conceived by the Awardee during employment by the
Company, relating in any manner to the actual or anticipated business, research
or development work of the Company and shall

 

 

12

--------------------------------------------------------------------------------

 

do anything reasonably necessary to enable the Company to secure a patent where
appropriate in the United States and in foreign countries; and

 

(iv)                              An Awardee retiring due to age shall render,
as a Consultant and not as an Employee, such advisory or consultative services
to the Company as shall be reasonably requested by the Board or the Executive
Committee in writing from time to time, consistent with the state of the retired
Awardee’s health and any employment or other activities in which such Awardee
may be engaged. For purposes of this Plan, the Awardee shall not be required to
devote a major portion of time to such services and shall be entitled to
reimbursement for any reasonable out–of–pocket expenses incurred in connection
with the performance of such services.

 

(d)                                 Death of Awardee. Unless otherwise provided
for by the Administrator in the Award Agreement, if an Awardee dies while an
Employee, the Stock Award shall immediately vest and all forfeiture provisions
and repurchase rights shall lapse as to a prorated number of shares determined
by dividing the number of whole months since the Grant Date by the number of
whole months between the Grant Date and the date that the Stock Award would have
fully vested (as provided for in the Award Agreement). The vested portion of the
Stock Award shall be delivered to the beneficiary designated by the Awardee (as
provided in Section 16), the executor or administrator of the Awardee’s estate
or, if none, by the person(s) entitled to receive the vested Stock Award under
the Awardee’s will or the laws of descent or distribution.

 

(e)                                  Voluntary Severance Incentive Program. If
an Awardee ceases to be an Employee as a result of participation in the
Company’s or its Subsidiaries’ voluntary severance incentive program approved by
the Board or Executive Committee, the Stock Award shall immediately vest and all
forfeiture provisions and repurchase rights shall lapse as to a prorated number
of shares determined by dividing the number of whole years since the Grant Date
by the number of whole years between the Grant Date and the date that the Stock
Award would have fully vested (as provided for in the Award Agreement).

 

(f)                                    Rights as a Shareowner. Unless otherwise
provided for by the Administrator, once the Stock Award is accepted, the Awardee
shall have the rights equivalent to those of a shareowner, and shall be a
shareowner when his or her acceptance of the Stock Award is entered upon the
records of the duly authorized transfer agent of the Company.

 

 

13

--------------------------------------------------------------------------------

 

12.  CASH AWARDS.

 

Cash Awards may be granted either alone, in addition to, or in tandem with other
Awards granted under the Plan. After the Administrator determines that it will
offer a Cash Award, it shall advise the Awardee in writing or electronically, by
means of an Award Agreement, of the terms, conditions and restrictions related
to the Cash Award.

 

13.  NON–TRANSFERABILITY OF AWARDS.

 

Unless determined otherwise by the Administrator, an Award may not be sold,
pledged, assigned, hypothecated, transferred, or disposed of in any manner other
than by beneficiary designation, will or by the laws of descent or distribution
and may be exercised, during the lifetime of the Awardee, only by the Awardee.
If the Administrator makes an Award transferable, such Award shall contain such
additional terms and conditions as the Administrator deems appropriate.

 

14.  ADJUSTMENTS UPON CHANGES IN CAPITALIZATION, DISSOLUTION, MERGER OR ASSET
SALE.

 

(a)                                  Changes in Capitalization. Subject to any
required action by the shareowners of the Company, the number and kind of shares
of Common Stock covered by each outstanding Award, and the number and kind of
shares of Common Stock which have been authorized for issuance under the Plan
but as to which no Awards have yet been granted or which have been returned to
the Plan upon cancellation or expiration of an Award, as well as the price per
share of Common Stock covered by each such outstanding Award, shall be
proportionately adjusted for any increase or decrease in the number or kind of
issued shares of Common Stock resulting from a stock split, reverse stock split,
stock dividend, combination or reclassification of the Common Stock, or any
other increase or decrease in the number of issued shares of Common Stock
effected without receipt of consideration by the Company; provided, however,
that conversion of any convertible securities of the Company shall not be deemed
to have been “effected without receipt of consideration.” Such adjustment shall
be made by the Board, whose determination in that respect shall be final,
binding and conclusive. Except as expressly provided herein, no issuance by the
Company of shares of stock of any class, or securities convertible into shares
of stock of any class, shall affect, and no adjustment by reason thereof shall
be made with respect to, the number or price of shares of Common Stock subject
to an Award.

 

(b)                                 Dissolution or Liquidation. In the event of
the proposed dissolution or liquidation of the Company, the Administrator shall
notify each Awardee as soon as practicable prior to the effective date of such
proposed transaction. The Administrator in its discretion may provide for an
Option to be fully vested and exercisable until ten (10) days prior to such
transaction. In addition, the Administrator may provide that any restrictions on
any Award shall lapse prior to the transaction, provided the proposed
dissolution or

 

14

--------------------------------------------------------------------------------

 

liquidation takes place at the time and in the manner contemplated. To the
extent it has not been previously exercised, an Award will terminate immediately
prior to the consummation of such proposed transaction.

 

(c)                                  Merger or Asset Sale. In the event there is
a change of control of the Company, as determined by the Board, the Board may,
in its discretion, (A) provide for the assumption or substitution of, or
adjustment to, each outstanding Award; (B) accelerate the vesting of Options and
terminate any restrictions on Cash Awards or Stock Awards; and (C) provide for
the cancellation of Awards for a cash payment to the Awardee.

 

15.  AMENDMENT AND TERMINATION OF THE PLAN.

 

(a)                                  Amendment and Termination. The Board may at
any time amend, alter, suspend or terminate the Plan.

 

(b)                                 Shareowner Approval. The Company shall
obtain shareowner approval of any Plan amendment to the extent necessary and
desirable to comply with Applicable Laws.

 

(c)                                  Effect of Amendment or Termination. No
amendment, alteration, suspension or termination of the Plan shall impair the
rights of any Award, unless mutually agreed otherwise between the Awardee and
the Administrator, which agreement must be in writing and signed by the Awardee
and the Company. Termination of the Plan shall not affect the Administrator’s
ability to exercise the powers granted to it hereunder with respect to Awards
granted under the Plan prior to the date of such termination.

 

16.  DESIGNATION OF BENEFICIARY.

 

(a)                                  An Awardee may file a written designation
of a beneficiary who is to receive the Awardee’s rights pursuant to Awardee’s
Award or the Awardee may include his or her Awards in an omnibus beneficiary
designation for all benefits under the Plan. To the extent that Awardee has
completed a designation of beneficiary while employed with Hewlett–Packard
Company, such beneficiary designation shall remain in effect with respect to any
Award hereunder until changed by the Awardee.

 

(b)                                 Such designation of beneficiary may be
changed by the Awardee at any time by written notice. In the event of the death
of an Awardee and in the absence of a beneficiary validly designated under the
Plan who is living at the time of such Awardee’s death, the Company shall allow
the executor or administrator of the estate of the Awardee to exercise the
Award, or if no such executor or administrator has been appointed (to the
knowledge of the Company), the Company, in its discretion, may allow the spouse
or one or more dependents or relatives of the Awardee to exercise the Award.

 

15

--------------------------------------------------------------------------------

 

17.  LEGAL COMPLIANCE.

 

Shares shall not be issued pursuant to the exercise of an Option or Stock Award
unless the exercise of such Option or Stock Award and the issuance and delivery
of such Shares shall comply with Applicable Laws and shall be further subject to
the approval of counsel for the Company with respect to such compliance.

 

18.  INABILITY TO OBTAIN AUTHORITY.

 

To the extent the Company is unable to or the Administrator deems it infeasible
to obtain authority from any regulatory body having jurisdiction, which
authority is deemed by the Company’s counsel to be necessary to the lawful
issuance and sale of any Shares hereunder, the Company shall be relieved of any
liability with respect to the failure to issue or sell such Shares as to which
such requisite authority shall not have been obtained.

 

19.  RESERVATION OF SHARES.

 

The Company, during the term of this Plan, will at all times reserve and keep
available such number of Shares as shall be sufficient to satisfy the
requirements of the Plan.

 

20.  SHAREOWNER APPROVAL.

 

The Plan shall be subject to approval by the shareowners of the Company within
twelve (12) months of the date the Plan is adopted. Such shareowner approval
shall be obtained in the manner and to the degree required under Applicable
Laws.

 

21.  NOTICE.

 

Any written notice to the Company required by any provisions of this Plan shall
be addressed to the Secretary of the Company and shall be effective when
received.

 

22.  GOVERNING LAW.

 

This Plan and all determinations made and actions taken pursuant hereto shall be
governed by the substantive laws, but not the choice of law rules, of the state
of Delaware.

 

23.  UNFUNDED PLAN.

 

Insofar as it provides for Awards, the Plan shall be unfunded. Although
bookkeeping accounts may be established with respect to Participants who are
granted Awards of Shares under this Plan, any such accounts will be used merely
as a bookkeeping convenience. Except for the holding of Restricted Stock in
escrow pursuant to Section 11, the Company shall not be required to segregate
any assets which may at any time be represented by Awards, nor shall this Plan
be construed as providing for such segregation, nor shall the Company nor the
Administrator be deemed to be a trustee of stock or cash to

 

 

16

--------------------------------------------------------------------------------

 

be awarded under the Plan. Any liability of the Company to any Awardee with
respect to an Award shall be based solely upon any contractual obligations which
may be created by the Plan; no such obligation of the Company shall be deemed to
be secured by any pledge or other encumbrance on any property of the Company.
Neither the Company nor the Administrator shall be required to give any security
or bond for the performance of any obligation which may be created by this Plan.

 

***

 

10/27/00     Two for one stock split in the form of a stock dividend

9/12/02       Section 10(g) amended and plan restated by HR & Compensation
Committee

11/21/02     Section 4.(a)(v) added and plan restated by HR & Compensation
Committee

 

 

17

--------------------------------------------------------------------------------