Exhibit 10(r)(r)


HEWLETT-PACKARD COMPANY FOREIGN EMPLOYEES STOCK
APPRECIATION RIGHTS PLAN


(Amended & Restated November 21, 2002)


The following
constitute the provisions of the Hewlett-Packard Company (“HP” or “Company”)
Foreign Employees Stock Appreciation Rights Plan (the “Plan”):


1.               DEFINITIONS: In this plan,


(a)          “Employee Stock Option Plan” means any of the Company’s incentive stock option plans pursuant to
which participating employees are offered and purchase shares of HP Common
Stock, which have been registered under the Securities Act of 1933.


(b)         “Foreign Subsidiary” means any corporation which is organized and exists under the laws of a
country other than the United States of America and 1) whose accounts are
consolidated with the accounts of the Company for reporting purposes; or 2)
which is an affiliate of HP and designated by the Committee as a “foreign
subsidiary” for purposes of this Plan.


(c)          “Foreign national employee” means an employee of a foreign subsidiary who is a national of a
country other than the United States of America.


(d)         “Unfavorable foreign law” means any law or governmental regulation of a country other than the
United States of America which has the effect of prohibiting, restricting or
inhibiting the acquisition or ownership of HP stock by a foreign national
employee, or requires the payment of currency premiums with respect to the
purchase of HP stock with funds supplied by a foreign national employee and his
employer.


(e)          “Eligible foreign subsidiary” means a foreign subsidiary any of whose foreign national employees is
subject to unfavorable foreign laws.


(f)            “Employee” means a foreign national employee of an eligible foreign subsidiary.


(g)         “Employer” means an eligible foreign subsidiary as to its employees.


(h)         “Stock appreciation right” means a right granted pursuant to Section 5 of the Plan.


(i)             “Committee” means the Human Resources and Compensation Committee of the Company.


(j)             “Common shares” means Common Shares, US $0.01 par value, of the Company.


(k)          “Fair market value” of Common Shares on any relevant date shall, for purposes of the Plan,
be the mean of the highest and lowest quoted selling prices for the Common
Shares as reported for New York Stock Exchange on the date on which
determination of such fair market value is to be made, or if no Common Shares
are traded on that date, then the reported closing price on the next preceding
day on which trading was reported.


(l)             “Discounted value” means the value fixed by the Committee with respect to any stock
appreciation right, which value shall be used in place of fair market value and
which may represent a discount of up to 25% off of fair market value on the
date the stock appreciation right is granted.


(m)       “Spread”
means the excess of the fair market value (or discounted value, if applicable)
of a Common Share on the date when a stock appreciation right granted pursuant
to the Plan is exercised over the fair market value of a Common Share on the
date when the stock appreciation right was granted under the Plan.


2.               PURPOSE.

The purpose of the Plan is to provide a means whereby foreign national
employees who are subject to unfavorable foreign laws may realize the benefits
intended to have been provided by granting of stock options under the Company’s
Employee Stock Option Plans. The Plan is designed to foster continued cordial
employee relations.


3.               PARTICIPATION
IN THE PLAN.

Foreign national employees, excluding officers and directors of the Company,
who are employed by an eligible foreign subsidiary, shall be eligible to participate
in the Plan.


4.               ADMINISTRATION.

The Committee shall supervise and administer the Plan. All questions of
interpretation of the Plan or of any stock appreciation right issued under it
shall be determined by the Committee and such determination shall be final and
binding upon all persons.


The
Committee shall have the authority, in its discretion to:  1) select the Employees to whom stock
appreciation rights may be granted, 2) approve forms of agreement for use under
the Plan, 3) determine the terms and conditions, not inconsistent with the
terms of the Plan, 4) adopt rules and procedures relating to the operation
and administration of the Plan to accommodate the specific requirements of
local laws and procedures, 5) prescribe, amend and rescind rules and
regulations relating to the Plan, 6) authorize any person to execute on behalf
of the Company any instrument required to effect the grant of a stock
appreciation right previously granted by the Committee, and 7) make all other
determinations deemed necessary or advisable for administering the Plan and any
stock appreciation right granted hereunder.


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.


5.               DEFINITION
AND VALUATION OF STOCK APPRECIATION RIGHTS.

Stock appreciation rights shall entitle the employee to receive from the
Company upon exercise of the stock appreciation rights or portion thereof, an
amount equal to 100% of the spread (as defined in Section 1 above) at the time
of the exercise of the stock appreciation rights, multiplied by the number of
stock appreciation 


 

















 


rights
exercised.  Such amount may be paid by
the Company in U.S. dollars or foreign currency equivalent.


6.               TERMS,
CONDITIONS AND FORMS OF STOCK APPRECIATION RIGHTS.

Each stock appreciation right granted under this Plan shall be authorized by
the action of a) the Committee; or b) the Executive Committee of the HP Board
of Directors, and shall be evidenced by a written agreement in such form as the
Committee shall from time to time approve, which agreement shall comply with
and be subject to the following terms and conditions:


(a)          Stock Appreciation Rights are
Non-Transferable. Each stock
appreciation right granted under the Plan by its terms shall not be
transferable by the holder otherwise than by will or by laws of descent and
distribution, and shall be exercised during the lifetime of the Employees only
by him. No stock appreciation right or interest therein may be transferred,
assigned, pledged or hypothecated by the holder during its lifetime, whether by
operation of law or otherwise, or be made subject to execution, attachment or
similar process.


(b)         Terms of Stock Appreciation Right. Unless a different vesting schedule is specified by the Committee at
the time a stock appreciation right is granted, no stock appreciation right may
be exercised before the first anniversary of the date upon which it was
granted, nor may it be exercised as to more than one-fourth the number of
rights covered herein before the second anniversary of the date of grant, nor
may it be exercised as to more than one-half the number of rights covered
herein before the third anniversary of the date of grant, nor may it be
exercised as to more than three-fourths the number of rights covered herein
before the fourth anniversary of the date of grant. Stock appreciation rights
will expire ten (10) years from the grant date unless sooner terminated or
cancelled in accordance with the provisions of the Plan. In the event of the
Employee’s death, all unexpired stock appreciation rights shall become
immediately exercisable in full by the Employee’s beneficiary designated in
accordance with Section 6 (d).


(c)          Exercise of Stock Appreciation Rights. The holder of  a stock
appreciation right may exercise the same by (1) filing with the Secretary of
the Company a written election specifying the stock appreciation rights or
portion thereof to be exercised and (2) surrendering such stock appreciation
rights for cancellation or partial cancellation, as the case may be. The stock
appreciation right shall be deemed to have been exercised on the date on which
the holder completed all acts required of him by this paragraph to exercise the
stock appreciation right.


(d)         Termination of Stock Appreciation Rights. All rights of an employee in a stock appreciation right, to the extent
that it has not been exercised, shall terminate upon the death of the Employee
(except as herein after provided), or the termination of his employment for any
reason other than retirement because of age or total and permanent disability,
and in case of such retirement three (3) years from the date thereof or upon
expiration of the stock appreciation right, whichever shall first occur;
provided, however, that the employee by written notice to the Company, may
designate one or more persons (and from time to time change such designation),
including his legal representative, who, by reason of his death, shall acquire
the right to exercise all or a portion of his stock appreciation rights. In the
event that the Employee does not designate a beneficiary, the stock
appreciation rights may be exercised in accordance with his will or, in the
absence of a will, in accordance with applicable law governing intestate
succession. The person or persons so designated or so empowered must exercise
any portion of the stock appreciation rights, within one (1) year after the
death of employee, and such exercise shall be subject to the provisions of this
Plan.


(e)          Conversion of Existing Option; Grant Date. The Committee may authorize the conversion of existing stock options
held by an Employee into stock appreciation rights. Any such grant of stock
appreciation rights shall be subject to the surrender for cancellation of said
stock options. Stock appreciation rights granted in substitution for existing
stock options shall be deemed to have the same grant date, term, and vesting as
the cancelled stock option.


(f)            Conversion of Existing Stock Appreciation
Rights; Grant Date. The Committee may
authorize the conversion of existing stock appreciation rights held by an
Employee into stock options. Any such substitution of stock options for stock
appreciation rights shall be subject to the surrender for cancellation of such
stock appreciation rights. Stock options substituted for existing stock
appreciation rights shall be deemed to have the same grant date, term, and
vesting as the cancelled stock appreciation rights.  Such stock options will be governed by the respective Employee
Stock Option Plan.


(g)         Buyout Provisions. At any time, the Committee may, but shall not be required to, authorize
the Company to offer to buy out for a payment in cash or Common Shares a stock
appreciation right previously granted based on such terms and conditions as the
Committee shall establish and communicate to the holder of such stock
appreciation rights in connection with such offer.


7.               LIMITATION
OF RIGHTS.

Nothing in the Plan shall be construed to give any eligible employee any right
to be granted a stock appreciation right. Neither the Plan nor the granting of
a stock appreciation right nor any other action taken pursuant to the Plan
shall constitute or be evidence of any agreement or understanding, express or
implied, that the Company or any foreign subsidiary will employ the holder of a
stock appreciation right for any period of time or in any position or at any
particular rate of compensation. The holder of stock appreciation right shall
have no rights as a stockholder with respect to his stock appreciation right.


8.               CHANGES
IN PRESENT COMMON SHARES.

In the event of any merger, consolidation, reorganization, recapitalization,
stock dividend, stock splits or other change in the corporate structure or
capitalization affecting the Company’s present Common Shares, appropriate
adjustment shall be made by the Board of Directors of the Company in the number
of stock appreciation rights granted hereunder and their valuation.


 

















 


In the event there is a change of control of the Company,
as determined by the Board of Directors of the Company, the Board of Directors
of the Company may, in its discretion, 1) provide for the assumption or
substitution of, or adjustment to, each outstanding stock appreciation right;
2) accelerate the vesting of such stock appreciation right; and
3) provide for the cancellation of stock appreciation rights for a cash
payment.


9.               AMENDMENT,
SUSPENSION OR TERMINATION OF STOCK APPRECIATION RIGHTS.

The Committee may at any time amend, suspend or terminate the Plan and any
stock appreciation rights theretofore granted under the Plan. In addition,
stock appreciation rights shall terminate and may no longer be exercised upon
any termination date specified by the Committee at the time of grant of such
stock appreciation rights.


10.         EFFECTIVE DATE OF THE PLAN.

The Plan shall take effect on the date of adoption by the Committee. Stock
appreciation rights may be granted under the Plan at any time after the
adoption of the Plan and prior to the termination of the Plan.


11.         GENDER.

Wheresoever used in this Plan, the masculine gender shall be deemed to include
the feminine.