Exhibit 10(f)(f)


 


HEWLETT-PACKARD COMPANY


BALANCED SCORE CARD PLAN


(Effective May 1, 2002)


 


1.             Purpose.  The purpose of the Hewlett-Packard Company
Balanced Score Card Plan is to provide certain employees of Hewlett-Packard
Company and its subsidiaries with incentive compensation based upon the level
of achievement of financial, business and other performance criteria.


2.             Definitions.  As used in the Plan, the
following terms shall have the meanings set forth below:


(a)           “Affiliate” shall mean (i)
any entity that, directly or indirectly, is controlled by the Company and (ii)
any entity in which the Company has a significant equity interest, in either
case as determined by the Committee.


(b)           “AFM” shall mean the Company’s Accounting
and Financial Manual, as posted from time to time on the Company’s internal web
site.


(c)           “Board” shall mean the Board of Directors
of the Company.


(d)           “Bonus” shall mean a cash payment, which
may be an addition to Base Pay made pursuant to the Plan with respect to a
particular Performance Period.  The
amount of a Bonus may be less than, equal to, or greater than the Target Bonus;
provided, however, that a Bonus shall not be greater than an amount equal to
three hundred percent (300%) of the Target Bonus.


(e)           “Code” shall mean the
Internal Revenue Code of 1986 and regulations promulgated thereunder, all as
amended from time to time, and any successors thereto.


(f)            “Committee” shall mean the
Committee, designated pursuant to Section 4 of the Plan.


(g)           “Company”
shall mean Hewlett-Packard Company, a Delaware corporation.


(h)           “Covered
Officer” shall mean at any date
(i) any individual who with respect to the previous taxable year of the
Company, was a “covered employee” of the Company within the meaning of Code
section 162(m); provided, however that the term “Covered Officer” shall not
include any such individual who is designated by the Committee, in its sole
discretion, at the time of any Bonus or at any subsequent time, as reasonably
expected not to be such a “covered employee” with respect to the then current
taxable year of the Company, and (ii) any individual who is designated by the
Committee, in its sole discretion, at the time of any Bonus or at any
subsequent time, as reasonably expected to be such a “covered employee” with respect
to the then current taxable year of the Company or with respect to the taxable
year of the Company in which any applicable Bonus will be paid.


(i)            “Eligible Earnings” shall mean the annual
base rate of cash compensation, excluding discretionary or contractual bonuses,
actual commissions/bonus payments paid to commissioned employees pursuant to an
incentive plan, Bonuses, Target 


 

















 


Bonuses, payments under the Hewlett-Packard Company Disability Plan and
the Hewlett-Packard Company Supplemental Disability Plan, or any other
additional compensation. Eligible earnings may be modified in accordance with
local law or requirements.


(j)            “Fiscal
Year” shall mean the twelve-month period from November 1 through October 31.


(k)           “Net
Order Dollars” shall be as defined in the Company’s Corporate
Marketing Policy, as posted on the Company’s internal web site at the start of
the Performance Period.


(l)            “Net
Profit Dollars” shall be as defined in the AFM at the start of the
Performance Period.


(m)          “Net
Profit Growth” shall be, with respect to any Performance Period,
as defined by the Committee, in its sole discretion.


(n)           “Net
Revenue Dollars” shall be as defined in the AFM at the start of the
Performance Period.


(o)           “Participant” shall mean
each salaried employee of the Company or its Affiliates in active service whose
position is designated by the Committee as eligible for participation in the
Plan; provided, however, that Participants must be selected prior to the
Predetermination Date.


(p)           “Performance
Measure” shall mean any measurable criteria using a Balanced
Score Card approach tied to the Company’s success that the Committee may
determine, including, but not limited to, Net Order Dollars, Net Profit
Dollars, Net Profit Growth, Net Revenue Dollars, Revenue Growth, Total
Shareholder Return Relative to Peer Index, individual performance, earnings per
share, return on assets, return on equity, other Company and business unit
financial objectives, customer satisfaction indicators, operational efficiency
measures and employee metrics.


(q)           “Performance
Period” shall mean a six-month period of time based upon the halves of the
Company’s Fiscal Year, or such other time period as shall be determined by the
Committee.


(r)            “Plan” shall mean the
Hewlett-Packard Company Balanced Score Card Plan, as amended from time to time.


(s)           “Predetermination
Date” shall mean (i) the earlier of: a date 45 days after commencement of
the Performance Period, or a date not later than the expiration of 25% of the
Performance Period; provided that the satisfaction of selected Performance
Measures is substantially uncertain at such time, or (ii) such other date on
which a performance goal is considered to be pre-established pursuant to Code
section 162(m).


 


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(t)            “Revenue
Growth” shall be, with respect to any Performance Period, as defined by the
Committee, in its sole discretion.


(u)           “Target Bonus” shall mean a
Bonus amount that may be paid if 100% of all the applicable Performance Measures
are achieved at Target in the Performance Period.  The Target Bonus shall be equal to a fixed percentage of the
Participant’s Base Pay for such Performance Period.  Such percentage shall be determined by the Committee prior to the
Predetermination Date.


(v)           “Total Shareholder Return Relative to
Peer Index” shall be, with respect to any Performance Period,
as defined by the Committee, in its sole discretion.


3.             Eligibility.  Persons employed by the
Company or any of its Affiliates during a Performance Period and in active
service are eligible to be Participants under the Plan for such Performance
Period (whether or not so employed or living at the date a Bonus is made) and
may be considered by the Committee for a Bonus.  An individual is not rendered ineligible to be a Participant by
reason of being a member of the Board. 
Notwithstanding anything herein to the contrary, the Committee shall
have sole discretion to designate or approve the Participants for any given
Performance Period.


4.             Administration.


(a)           Unless otherwise designated by the
Board, the HR & Compensation Committee of the Board shall be the
Committee under the Plan.  A director
may serve as a member or an alternate member of the Committee only during
periods in which the director is an “outside director” as described in Code
section 162(m).  The Committee shall
have full power and authority to construe, interpret and administer the
Plan.  It may issue rules and
regulations for administration of the Plan and shall meet at such times and places
as it may determine.  A majority of the
members of the Committee shall constitute a quorum and all decisions of the
Committee shall be final, conclusive and binding upon all parties, including
the Company, its stockholders, employees and Participants.  In the case of Participants who are not
Covered Officers, the Committee may empower certain person(s) or a committee to
administer the Plan, to the extent specified by the Committee at the time of
delegation, and subject to modification at any time thereafter, whose decisions
shall similarly be final, conclusive and binding upon all parties.


(b)           The expenses of the
administration of the Plan shall be borne by the Company.


5.             Term.  Subject to Section 10(g),
the Plan shall be effective as of  May
1, 2002 and shall be applicable for future Fiscal Years of the Company unless
amended or terminated by the Board or the Committee pursuant to Section 10(e).


6.             Bonuses.
Prior to the Predetermination Date, the Committee or, if applicable,
the Committee's delegate, shall designate or approve (a) the positions or
employees who will be Participants for a Performance Period, (b) the
minimum and maximum Bonuses and the Target Bonuses for the position or
employee, (c) the applicable Performance Measures and combination of Performance
Measures and percentages allocated to the applicable Performance Measures; and
(d) the Performance Period.  All
Performance Measures pertaining to a Covered Officer shall be of such a nature
that an objective 


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third
party having knowledge of all the relevant facts could determine whether
performance results with respect to such Performance Measures have been
achieved.


7.             Determination of Amount of Bonus.


(a)           Calculation.   As soon as administratively practicable
after the end of the relevant Performance Period, the Committee, or, in the
case of a Bonus to a Participant who is not a Covered Officer, the person(s) or
committee empowered by the Committee or the Board, shall determine the amount
of the Bonus for each Participant by:


(i)            Determining the actual performance results for each
Performance Measure;


(ii)           Determining the amount to which each Participant is
entitled based on the percentage allocated by the Committee to each Performance
Measure against the Target Bonus for each Participant; and


(iii)          Certifying by resolution duly adopted by the Committee (or
by the person(s) or committee empowered by the Committee in the case of
Participants who are not Covered Officers) the amount of the Bonus for each
Participant so determined.


(b)           Adjustments to
Bonuses.


(i)            In General. 
In its sole discretion, the Committee or the Committee's delegate may,
but is not required to, make an adjustment to a Participant's Bonus to take
into account events or situations which: (A) have a financial impact relevant
to the applicable Performance Period, (B) were not already taken into
account in the Participant's Performance Measures for such period, and
(C) which had a financial impact in the applicable Performance Period in
excess of U.S. $50 million due to any of the following:
(I) acquisitions and investments, (II) divestitures, (III) a
major change in U.S. accounting principles, or (IV) a major reorganization
within the Company. In its sole discretion, and without delegation, the
Committee alone may approve any other adjustments to a Participant’s Bonus
during a Performance Period.


(ii)           Reductions. In addition to a general Bonus
adjustment addressed in Section 7(b)(i), the Committee may, in the
exercise of its sole discretion and based on any factors the Committee deems
appropriate, reduce or eliminate to zero the amount of a Bonus to a Participant
otherwise calculated in accordance with the provisions of Section 7(a)
prior to payment thereof.  The Committee
shall make a determination of whether and to what extent to reduce Bonuses
under the Plan for each Performance Period at such time or times following the
close of the Performance Period as the Committee shall deem appropriate.  The reduction in the amount of a Bonus to a
Participant for a Performance Period shall have no effect on the amount of the
Bonus to any other Participant for such period.


(c)           No Adjustments
for Covered Officers. 
Notwithstanding the provisions of Section 7(b) above and for
purposes of tax deductibility under Section 162(m) of the Code, any adjustments
made in accordance with or for the purposes of Section 7(b) shall be
disregarded for purposes of calculating the Bonus to any Covered Officer to the
extent that such adjustments would have the effect of increasing such Bonus.


(d)           Maximum.  Notwithstanding
any other provision of this Plan, the maximum Bonus that may be paid to a
Covered Officer under the Plan with respect to a particular Performance Period
is $15 million.  To the extent the
period of time defining a Performance Period is changed by the Committee, then
the maximum Bonus that may be paid to a Covered Officer under the Plan is an
amount that bears the same pro rata relationship to the new period of time as
the above amount does to the current six-month Performance Period as set by the
Committee.


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8.             Payment of Bonuses.


(a)           Payment of a Bonus
to a Participant shall be made as soon as practicable after determination of
the amount of the Bonus under Section 7 above, and after the Committee has
certified in writing the amount to be paid, except to the extent a Participant
has made a timely election to defer the payment of all or any portion of such
Bonus under the Hewlett-Packard Company Executive Deferred Compensation Plan or
any other similar plan as the Committee determines in its discretion.


(b)           A participant will
forfeit any Bonus for a Performance Period during which he or she is
involuntarily terminated for cause or voluntarily terminates his or her
employment with the Company for any reason except as otherwise provided in Section
8(c) below.


(c)           The payment of a
Bonus with respect to a specific Performance Period requires that the employee
be on the Company’s payroll as of the end of such Performance Period, subject
to the following:


(i)            Non-Pay Status. 
A Participant who continues to be on approved non-pay status through the
end of the Performance Period will receive a bonus payment if return to work is
within the maximum period approved by the Company for the non-pay status.  If the non-pay status results in a leave of
absence or termination, guidelines governing those situations will apply.


(ii)           Leave of Absence. 
A Participant will receive a bonus payment while on an approved leave of
absence even if the leave began prior to the end of the Performance
Period.  The Bonus will be based on the
Participant’s actual Base Pay for the Performance Period.  While on an approved medical leave of
absence, accrual of Base Pay will continue for as long as the employee is
integrating disability benefits with flexible time off (FTO) hours, or sick or
vacation hours.  Only the FTO or sick or
vacation hours will be included in Base Pay.


(iii)          Work-Related Illness/Injury.  A Participant who cannot work due to a
work-related injury/illness and who may be drawing Workers’ Compensation
benefits will be placed on medical leave from the last day worked.  While on leave, a Participant will receive a
bonus payment even if the leave began prior to the end of the Performance
Period.


(iv)          Work Force Reduction.  If the reason for a Participant’s termination of employment prior
to the end of a Performance Period is Work Force Reduction, any bonus will be
prorated based upon the Participant’s Eligible Earnings for the Performance
Period, unless otherwise determined due to local law.


(v)           Retirement. 
If the reason for a Participant’s termination of employment prior to the
end of a Performance Period is his or her retirement at the age and
service-year level set by the Company or the local law requirements where the
Participant is employed, any Bonus will be pro-rated based upon the employee’s
time spent actively at work prior to his or her retirement date.


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(vi)          Death.  If a
Participant dies prior to the end of a Performance Period or after the end of a
Performance Period but prior to payment, any Bonus will be paid to the
Participant’s estate and will be based on the Participant’s actual Base Pay for
the Performance Period.


(d)           Payments of Bonuses
to Participants who are on the payroll of Affiliates of the Company shall be
paid directly by such entities.


9.             Changes in Status.


(a)           If prior to the end
of a Performance Period a person is hired for a position previously designated
by the Committee for participation under the Plan, that person will commence
participation in the Plan on a pro-rated basis from the date of hire.  If an employee is promoted into such a
position from a position that was eligible for participation in the Company
Performance Bonus Plan, or the Pay-for-Results Short-Term Bonus Plan, he or she
will be considered to have been a Participant in this Plan from the beginning
of the Performance Period or, if later, from the date of hire. Notwithstanding
the foregoing, this Section 9(a) shall not apply to a Covered Officer.


(b)           If a Participant
transfers from one eligible position to another prior to the end of a
Performance Period, any Bonus will be based on performance as it relates to the
latest position.


(c)           If prior to the end
of a Performance Period, a Participant transfers into a position that is not
eligible for participation under the Plan, the employee will not receive a
Bonus under the Plan.


10.          Miscellaneous.


(a)           No Assignment.  No portion of any Bonus under the Plan may
be assigned or transferred otherwise than by will or the laws of descent and
distribution prior to the payment thereof.


(b)           Tax Requirements.  All payments made pursuant to the Plan or
deferred pursuant to Section 8(a) shall be subject to all applicable taxes or
contributions required by federal, state or local law to be withheld, in
accordance with the procedures to be established by the Committee.


(c)           No Additional
Participant Rights.  The selection
of an individual for participation in the Plan shall not give such Participant
any right to be retained in the employ of the Company or any of its Affiliates,
and the right of the Company and any such Affiliate to dismiss such Participant
or to terminate any arrangement pursuant to which any such Participant provides
services to the Company, with or without cause, is specifically reserved.  No person shall have claim to a Bonus under
the Plan, except as otherwise provided for herein, or to continued
participation under the Plan.  There is
no obligation for uniformity of treatment of Participants under the Plan.  The benefits provided for Participants under
the Plan shall be in addition to and shall in no way preclude other forms of
compensation to or in respect of such Participants.  It is expressly agreed and understood that the employment is
terminable at the will of either party and, if such Participant is a party to
an employment contract with the Company or 


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one
of its Affiliates, in accordance with the terms and conditions of the
Participant’s employment contract.


(d)           Liability.  The Board and the Committee shall be
entitled to rely on the advice of counsel and other experts, including the
independent auditors for the Company. 
No member of the Board or of the Committee, any officers of the Company
or its Affiliates or any of their designees shall be liable for any act or failure
to act under the Plan, except in circumstances involving bad faith on the part
of such member, officer or designee.


(e)           Amendment;
Suspension; Termination.  The Board
or Committee may, at any time and from time to time, amend, suspend or
terminate the Plan or any part of the Plan as it may deem proper and in the
best interests of the Company.  In the
case of Participants employed outside the United States, the Board, the
Committee or their designees may vary the provisions of the Plan as deemed
appropriate to conform with local laws, practices and procedures.  In addition, the Executive Committee of the
Board or any of the General Counsel, Secretary or Assistant Secretary of the
Company is authorized to make certain minor or administrative changes required
by or made desirable by government regulation. 
Any modification of the Plan may affect present and future Participants
and the amount of any Bonus hereunder.


(f)            Other
Compensation Arrangements.  Nothing
contained in the Plan shall prevent the Company or any Affiliate of the Company
from adopting or continuing in effect other compensation arrangements, which
arrangements may be either generally applicable or applicable only in specific
cases.


(g)           Governing Law.  The validity, construction and effect of the
Plan and any rules and regulations relating to the Plan shall be determined in
accordance with the laws of the State of Delaware and applicable federal law.


(h)           No Trust.  Neither the Plan nor any Bonus shall create
or be construed to create a trust or separate fund of any kind or a fiduciary
relationship between the Company or any Participant.  To the extent that the Participant acquires a right to receive
payments from the Company in respect of any Bonus, such right shall be no
greater than the right of any unsecured general creditor of the Company.


(i)            Section 162(m).
All payments under this Plan are designed to satisfy the special requirements
for performance-based compensation set forth in Code section 162(m)(4)(C) of
the Code, and the Plan shall be so construed. 
Furthermore, if a provision of the Plan causes a payment to fail to
satisfy these special requirements, it shall be deemed amended to satisfy the
requirements to the extent permitted by law and subject to Committee approval.


(j)            Designation of
Beneficiaries.  A Participant may,
if the Committee permits, designate a beneficiary or beneficiaries to receive
all or part of the Bonuses which may be paid to the Participant, or may be
payable, after such Participant’s death. 
A designation of beneficiary shall be made in accordance with procedures
specified by the Company and may be replaced by a new designation or may be
revoked by the Participant at any time. 
In case of the Participant’s death, a Bonus with respect to which a
designation of beneficiary has been made (to the extent it is valid and
enforceable under applicable law) shall be paid to the designated beneficiary
or beneficiaries.  Any Bonus granted or
payable to a Participant who is deceased and not subject to such a designation
shall be distributed to the Participant’s estate.  If there shall be any question as to the legal right of any
beneficiary to receive a Bonus under the Plan, the 


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amount
in question may be paid to the estate of the Participant, in which event the
Company or its Affiliates shall have no further liability to anyone with
respect to such amount.


(k)           Stockholder
Approval.  Plan amendments shall
require stockholder approval only if and to the extent required by applicable
law or the applicable rules of any stock exchange.


(l)            Severability.  If any portion of this Plan is deemed to be
in conflict with local law, that portion of the Plan, and that portion only,
will be deemed void under local law. 
All other provisions of the Plan will remain in effect.


(m)          Savings Clause.  If any portion of this Plan as it relates to
a Covered Officer is construed as failing to satisfy the provisions of Code
section 162(m), then the Plan will be deemed amended to satisfy the
requirements to the extent permitted by law and subject to Committee approval.


11.          Execution


IN WITNESS WHEREOF, the Company has caused this Plan
to be adopted this                    day of June 2002, effective
May 1, 2002.


 


 


	
   

  	
  HEWLETT-PACKARD
  COMPANY

  
	
   

  	
   

  
	
   

  	
  /s/ PHILIP CONDIT

  
	
   

  	
  Philip M. Condit

  
	
   

  	
  Chair, HR and Compensation Committee

  



 


 


 


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