Exhibit 10.1


 


HEWLETT-PACKARD COMPANY


 


LÉO APOTHEKER EMPLOYMENT AGREEMENT


 


This Agreement is entered
into on September 29, 2010 by and between Hewlett-Packard Company (the “Company”)
and Léo Apotheker (“Executive”).


 


1.                                    Duties and Scope of Employment.


 


(a)                               Positions and
Duties.  As of November 1, 2010,
Executive will serve as President and Chief Executive Officer of the Company,
reporting to the Company’s Board of Directors (the “Board”), provided that
Executive has obtained a United States visa permitting him to accept an
executive position with the Company for the intended Employment Term, as
defined below (the “Effective Date”). 
Executive will render such business and professional services in the
performance of his duties, consistent with Executive’s position within the
Company.  Executive will be the highest
ranking executive officer of the Company, with the full powers,
responsibilities and authorities customary for the chief executive officer of
corporations of the size, type and nature of Company, together with such other
powers, authorities and responsibilities as may reasonably be assigned to him
by the Board.  Executive will report
solely and directly to the Board.  The
period Executive is employed by the Company under this Agreement is referred to
herein as the “Employment Term.”


 


(b)                              Board Membership.  Executive will be appointed to serve as a
member of the Board as of the Effective Date. 
Thereafter, at each annual meeting of the Company’s stockholders during
the Employment Term, the Company will nominate Executive to serve as a member
of the Board.  Executive’s service as a
member of the Board will be subject to any required stockholder approval.  Upon the termination of Executive’s
employment for any reason, Executive will be deemed to have resigned from the
Board (and any boards of subsidiaries) voluntarily, without any further
required action by Executive, as of the end of Executive’s employment and
Executive, at the Board’s request, will execute any documents necessary to
reflect his resignation.


 


(c)                               Obligations.  During the Employment Term, Executive will
devote Executive’s full business efforts and time to the Company and will use
good faith efforts to discharge Executive’s obligations under this Agreement to
the best of Executive’s ability.  For the
duration of the Employment Term, Executive agrees not to actively engage in any
other employment, occupation, or consulting activity for any direct or indirect
remuneration without the prior approval of the Board (which approval will not
be unreasonably withheld); provided, however, that Executive may, without the
approval of the Board, serve in any capacity with any civic, educational, or
charitable organization and serve on the board(s) set forth on Schedule A
attached hereto, provided such services do not materially interfere with
Executive’s obligations to the Company. 
Executive represents that he is not subject to any non-competition,
confidentiality, trade secrets or other agreement(s) that would preclude,
or restrict in any way, Executive from fully performing his services hereunder
during his employment with the Company.


 













 


2.                                    At-Will Employment. 
Executive and the Company agree that Executive’s employment with the
Company constitutes “at-will” employment. 
Executive and the Company acknowledge that this employment relationship
may be terminated at any time, upon written notice to the other party, with or
without good cause or for any or no cause, at the option either of the Company
or Executive.  However, as described in
this Agreement, Executive may be entitled to severance and other benefits
depending upon the circumstances of Executive’s termination of employment.


 


3.                                    Term of Agreement.  This
Agreement will have a term of four (4) years commencing on the Effective
Date.  No later than 90 days before the
end of the term of this Agreement, the Company and Executive will discuss
whether and under what circumstances the Agreement will be renewed.


 


4.                                    Compensation.


 


(a)                               Base Salary.  As of the Effective Date, and until October 31,
2012, the Company will pay Executive an annual salary of $1,200,000 as
compensation for his services (such annual salary, as is then effective, to be
referred to herein as “Base Salary”). 
The Base Salary will be paid periodically in accordance with the Company’s
normal payroll practices and be subject to the usual, required
withholdings.  Executive’s annual salary
beginning November 1, 2012, and thereafter, will be $1,200,000 and will be
subject to review by the HR/Compensation Committee of the Board, or any successor
thereto (the “Committee”) not less than annually, and adjustments will be made
in the discretion of the Committee. 
Notwithstanding the foregoing, the Base Salary will not be reduced other
than (i) pursuant to a reduction that also is applied to substantially all
other executive officers of the Company in a substantially similar manner and
proportion or (ii) to give effect to the Committee’s policy, as published
in the Compensation Discussion and Analysis section of the Company’s annual
proxy statement or other documents filed with the Securities and Exchange
Commission, for aligning Executive’s compensation with the compensation of
chief executive officers of the Company’s peer group.


 


(b)                              Annual Incentive.  Executive will be eligible to receive annual cash
incentives payable for the achievement of performance goals established by the
Committee beginning with the Company’s 2011 fiscal year.  Executive’s target annual incentive for
fiscal 2011 will be at least 200% of Base Salary and his maximum target opportunity
will be 500% of Base Salary, based upon specified levels of performance goals
being achieved.  For subsequent fiscal
years, beginning with fiscal 2012, Executive’s target bonus shall be at least
200% of the Base Salary, and maximum target opportunity shall be as determined
by the Committee; provided, however, that, except as otherwise provided herein,
Executive’s future participation in the Company’s Pay for Results Plan, or any
successor thereto (the “Annual Incentive Plan”), shall be on the same terms and
conditions that apply to other senior executives generally.  The actual earned annual cash incentive, if
any, payable to Executive for any performance period will depend upon the
extent to which the applicable performance goal(s) specified by the
Committee under the Annual Incentive Plan are achieved and will be decreased or
increased for under- or over-performance. 
Except as specifically provided herein, Executive’s annual cash
incentive will be subject to the terms and conditions of the Annual Incentive
Plan, including payment date and continued employment obligations.  The Company agrees, for fiscal year 2011,
that all performance goals will be deemed to have been achieved at least at
target level.


 


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(c)                               Long-Term
Incentives.


 


(i)                                  Restricted Stock. 
Within 30 days of the Effective Date, Executive will be granted 76,000
shares of the Company’s common stock under the Company’s 2004 Stock Incentive
Plan as in effect on the Effective Date (the “Stock Plan”).  Except as otherwise provided in the Stock
Plan or hereunder, 50% of those shares (38,000) will vest and be
non-forfeitable if Executive is employed on October 31, 2011 and the
remaining 50% (38,000) will vest and be non-forfeitable if Executive is
employed on October 31, 2012.  In
all other respects, and except as specifically provided herein, such grant will
be subject to terms and conditions of the Stock Plan and the Committee’s
standard terms and conditions for this type of award.


 


(ii)                              Performance Restricted Units. 
Within 30 days of the Effective Date, Executive will also be granted two
tranches of Performance Restricted Units (“PRUs”) under the Stock Plan, 304,000
PRUs relating to the three-year period beginning November 1, 2009 and vesting
on October 31, 2012 (“Grant 1”) and 304,000 PRUs to be earned over the
three-year period beginning November 1, 2010, and vesting on October 31,
2013 (“Grant 2”), to the extent the applicable performance metrics are achieved
and Executive is still employed on the vesting date, except as otherwise
provided in the Stock Plan or as specifically provided herein.  The PRUs metrics regarding cash flow and
Total Shareholder Return will be as set forth in Executive’s grant instrument
under the Stock Plan and, in the case of Grant 1, will be the same as for the
PRUs previously awarded to Company employees in respect of the three-year
period beginning November 1, 2009 and ending on October 31, 2012.  Following
the close of the performance period for Grant 1, the Committee shall determine
the number of PRUs earned based on actual performance for the three-year
performance period and that number shall be reduced by one-third reflecting the
fact that Executive was not employed for the first year of the performance period.  For Grant 2, the cash flow metric for the
first year of the three-year period, November 1, 2011 through October 31,
2012, but not any subsequent year, shall be deemed to have been achieved at no
less than target level.  In all other
respects, such grants will be subject to terms and conditions of the Stock
Plan, and the Committee’s standard terms and conditions for this type of award.


 


(iii)                          For each Company fiscal year, beginning with
2012, and so long as the Stock Plan, or any successor thereto, is in effect and
other senior executives are granted PRUs or other long-term incentive awards,
Executive will be eligible for a grant, with the number of PRUs (or other
long-term incentive award) and the relevant terms and conditions, to be
determined in the sole discretion of the Committee; provided, however, that any
future grants of PRUs (or other long-term incentive award) to Executive shall
be on terms no less favorable than those that apply to the other senior
executives generally.


 


(d)                             One-Time Sign-On Grants:
Restricted Shares and PRUs.


 


(i)                                  Restricted Stock. 
Within 30 days of the Effective Date, Executive will be granted 80,000
shares of the Company’s common stock under the Stock Plan.  Except as otherwise provided in the Stock
Plan or hereunder, 50% of those shares (40,000) will vest and be
non-forfeitable if Executive is employed on October 31, 2011 and the
remaining 50% (40,000) will vest and be non-forfeitable if Executive is
employed on October 31, 2012.  In
all other 


 


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respects, such grant will be subject to terms and
conditions of the Stock Plan, and the Committee’s standard terms and conditions
for this type of award.


 


(ii)                              Performance Restricted Units. 
Within 30 days of the Effective Date, Executive will also be granted
120,000 PRUs under the Stock Plan.  The
PRUs are to be earned over the three-year period beginning November 1,
2010, and will vest on October 31, 2013, to the extent the performance
metrics are achieved and Executive is still employed on the vesting date,
except as otherwise provided in the Stock Plan or hereunder.  The PRUs metrics regarding cash flow and
Total Shareholder Return will be as set forth in Executive’s grant instrument
under the Stock Plan, except that the cash flow metric for the first year of
the three-year period, November 1, 2011 through October 31, 2012, but
not any subsequent year, shall be deemed to have been achieved at no less than
target level.  In all other respects,
such grant will be subject to terms and conditions of the Stock Plan, and the
Committee’s standard terms and conditions for this type of award.


 


(iii)                          Stock Ownership Guidelines. 
Executive shall be subject to, and shall comply with, the Company’s
Stock Ownership Guidelines; provided, however, that no holding requirement
shall be imposed upon common shares issued to Executive under clauses (i) and
(ii) hereof notwithstanding any contrary provisions in those Guidelines.


 


(e)                               Signing Bonus.  On the sixtieth (60th) day after this Agreement
is executed by both parties, Executive will receive a signing bonus equal to
$4,000,000 (the “Signing Bonus”).  If
Executive’s employment terminates other than by reason of death, Disability (as
defined below) or termination without Cause (as defined below) within eighteen
(18) months  of the Effective Date,
Executive will return to the Company an amount equal to the Signing Bonus
multiplied by a fraction with the numerator equaling 18 less the number of
whole months that have elapsed from the Effective Date to the date of Executive’s
termination of employment (the “Date of Termination”) and a denominator equal
to eighteen (18).


 


(f)                                Relocation Benefit.  In accordance with Company’s relocation
policy, Executive will receive the standard Company relocation package.  However, in light of the substantial payments
and benefits Executive is forfeiting from his prior employment to accept
employment by the Company, and the substantial expense Executive will incur to
move his residence to, and acquire a new residence in, the United States,
Executive’s relocation allowance will equal $4,600,000 (the “Relocation
Allowance”), allocable $2,900,000 to relocation (the “Relocation Payment”) and
$1,700,000 to the forfeiture of payments and benefits (the “Forfeiture Payment”).  The payment to Executive of the Relocation
Allowance will be made on the sixtieth (60th) day after this Agreement is
executed by both parties and shall be in lieu of the relocation allowance
otherwise provided for under the Company’s relocation policy.  The Relocation Payment will be fully vested
and will not be subject to repayment by Executive, in whole or in part,
provided Executive is employed by the Company for at least sixty (60) calendar
days following the Effective Date; provided, however, that the Executive will
not be obligated to repay the Relocation Payment if his employment is
terminated without Cause during such 60-day period.  The Forfeiture Payment will be fully vested
upon payment and will not be subject to repayment by Executive, in whole or in
part.


 


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5.                                    Employee Benefits, etc.


 


(a)                               Generally.  Executive will be eligible to participate in
accordance with the terms of all Company employee benefit plans, policies, and
arrangements that are applicable to other executive officers of the Company, as
such plans, policies, and arrangements may exist from time to time.  The Company represents that it currently
sponsors one or more health insurance plans for which Executive will be
eligible and which cover, subject to the terms and limitations of the plan,
medical treatment received outside the United States.


 


(b)                              Vacation.  Executive will be entitled to receive paid
annual vacation in accordance with Company policy for other senior executive
officers.  In no event will Executive
receive less than twenty-five (25) days of paid vacation time per employment
year.


 


(c)                               Perquisites.  Executive will receive Company perquisites on
at least the same level as the Company’s other senior executive officers;
provided that access to the Company’s jet aircraft, in accordance with the
Company’s aircraft policy, will commence on the date that Executive’s
appointment to the positions under this Agreement is publicly announced.


 


(d)                             Security.  The Company will provide Executive with
appropriate security in accordance with what Executive and the Company’s Global
Security Department agree from time to time and as approved by the
Committee.  Such security will be
provided beginning on the date that Executive’s appointment to the positions
under this Agreement is publicly announced.


 


(e)                               United States
Residency.  The Company and Executive
understand that there are specific requirements and rules which govern
Executive’s residency in France and whether Executive will be a non-resident of
France and a resident of the United States for purposes of his employment under
this Agreement.  The Company will use
reasonable commercial efforts to assist Executive (and his spouse) in obtaining
an appropriate visa and in qualifying as a non-resident of France during the
Term but Executive agrees to take all reasonable steps necessary to assume
non-resident status in France and appropriate immigration status in the United
States and acknowledges that he assumes all risks associated with these requirements,
including without limitation the personal French income and social tax
requirements.


 


6.                                    Expenses.  The Company will reimburse
Executive for reasonable travel, entertainment, and other expenses incurred by
Executive in the furtherance of the performance of Executive’s duties
hereunder, in accordance with the Company’s expense reimbursement policy as in
effect from time to time.


 


7.                                    Termination of Employment.  In
the event Executive’s employment with the Company terminates for any reason,
Executive will be entitled to any (a) unpaid Base Salary accrued up to the
Date of Termination, (b) unpaid, but earned annual incentive for any
completed fiscal year as of the Date of Termination, (c) pay for accrued
but unused vacation, (d) benefits or compensation as provided under the
terms of any employee benefit and compensation agreements or plans applicable
to Executive and under which he has a vested right (including any right that
vests in connection the termination of his employment), (e) unreimbursed
business expenses to which Executive is entitled to reimbursement under the
Company’s expense reimbursement policy, and (f) rights to indemnification
Executive may have under the


 


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Company’s Articles of Incorporation, Bylaws, the
Employment Agreement, or separate indemnification agreement, as applicable,
including any rights Executive may have under directors and officers insurance
policies.  In addition, if the termination
is by the Company without Cause, Executive will be entitled to the amounts and
benefits specified in Section 8.


 


8.                                    Severance.


 


(a)                               Termination
Without Cause.  If Executive’s employment is
terminated by the Company without Cause, then, subject to compliance with Section 9,
Executive will be eligible to participate in the then existing Severance Plan
for Executive Officers (the “Severance Program”); provided, however, that
payment to Executive shall be made in monthly installments (on the first
business day of each month) over the 18-month period following the Date of
Termination.  The first such installment
shall be made on the first business day of the month following the sixtieth (60th) day after
the Date of Termination and shall be in the amount of one-ninth (1/9) of the
total severance amount due to Executive, and each of the remaining sixteen (16)
installments shall be in the amount of one-eighteenth (1/18) of the total
severance amount due to Executive.  It is
understood that the Severance Program is reviewed annually by the Committee and
may be revised by it.  Notwithstanding
the preceding sentence, until the third anniversary of the Effective Date,
Executive’s entitlement to cash severance if his employment is terminated by
the Company without Cause shall not be less than 2.0 times the sum of (A) the
Base Salary as in effect immediately before the Date of Termination and
(B) a “Bonus Component” determined as follows:


 


i)               if the Date of
Termination occurs before the end of the Company’s 2011 fiscal year, the Bonus
Component will be Executive’s target annual incentive compensation for such
fiscal year;


 


ii)           if the Date of
Termination occurs on or after the end of the Company’s 2011 fiscal year but
before the end of the Company’s 2012 fiscal year, the Bonus Component will be
Executive’s actual annual incentive compensation for the Company’s 2011 fiscal
year; and


 


iii)       if the Date of
Termination occurs on or after the end of the Company’s 2012 fiscal year but
before the end of the Company’s 2013 fiscal year, the Bonus Component will be
the average of Executive’s actual annual cash incentive compensation for the
Company’s 2011 and 2012 fiscal years.


 


In addition, and notwithstanding the terms of the
Severance Program, if, without his consent, (w) Executive’s titles,
authority, duties or responsibilities under this Agreement are materially
reduced, (x) Executive’s salary, annual incentive or long-term incentive
opportunities are materially reduced in violation of this Agreement, (y) the
Company requires Executive to materially change the location at which he
performs services under this Agreement and that increases the distance of the
commute to his workplace by more than 50 miles, and, in the case of any of the
foregoing clauses (w), (x) or (y) Executive notifies the Company
within 90 days of the alleged reduction or relocation and the Company does not
cure the same within 30 days thereafter, or (z) Executive is not reelected
to the Board during the Employment Term, then Executive will be deemed to have
been terminated without Cause and his employment shall 


 


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cease on the 30th day following the end of the cure
period or his failure to be reelected to the Board.  Notwithstanding the foregoing, the amount of
severance benefits received by Executive under this Section 8(a) will
not exceed 2.99 times the sum of Executive’s Base Salary and annual incentive
as determined by the HP Severance Policy for Senior Executives, unless such
benefits are approved by the Company’s stockholders pursuant to the Company’s
established policy.


 


(b)                              Termination
without Cause: Treatment of Equity Incentive Awards.  If Executive’s employment is terminated by
the Company without Cause prior to the third anniversary of the Effective Date,
then in addition to the benefits provided for in Section 8(a) above,
the following shall apply:


 


i)               The restricted
stock awarded to Executive pursuant to Sections 4(c)(i) and 4(d)(i), and
all other awards of restricted stock or restricted stock units made to
Executive after the Effective Date, will vest in full and be non-forfeitable as
of the Date of Termination;


 


ii)           All continued
service requirements to the vesting of the PRUs awarded pursuant to Sections
4(c)(ii) and 4(d)(ii) will be deemed satisfied as of the Date of
Termination.  The PRUs included in Grant
2 will be based on actual performance; for the first year of the award only,
the cash flow metric will be considered to have been achieved at no less than
target.  The PRUs included in Grant 2
will be payable at the end of the performance period subject to any
discretionary adjustment that the Committee makes generally to PRUs for that
performance period.  The PRUs included in
Grant 1 will be payable at the end of the applicable performance period, determined
based on actual performance subject to any discretionary adjustment that the
Committee makes generally to PRUs for that performance period;


 


iii)       With respect to
other awards of PRUs (or other long-term incentive awards) made to Executive on
or after the Effective Date, Executive will vest in a pro rata amount of the
PRU award (or other long-term incentive award), payable at the end of the
applicable performance period, determined based on the number of whole months
worked during the relevant performance period plus, if the Date of Termination
occurs on or after the second anniversary of the Effective Date, twelve
(12).  Payment will be based on actual
performance during the performance period (subject to any discretionary
adjustment that the Committee makes generally to PRUs (or such other long-term
incentive awards) for the relevant performance period).


 


(c)                               Termination for
Cause.  If Executive’s employment is
terminated for Cause by the Company, then, except as provided in Section 7,
(i) all further vesting of Executive’s outstanding equity awards will
terminate immediately; (ii) all payments of compensation by the Company to
Executive hereunder will terminate immediately, and (iii) Executive will
be eligible for severance benefits only in accordance with the Company’s then
established plans, programs, and practices.


 


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(d)                             Other Termination
Including due to Death or Disability.  If
Executive’s employment terminates for any other reason, including but not
limited to, death or Disability, then, except as provided in Section 7, (i) Executive’s
outstanding equity awards will be treated in accordance with the terms and
conditions of the applicable award agreement(s); (ii) all payments of
compensation by the Company to Executive hereunder will terminate immediately,
and (iii) Executive will be entitled to receive benefits only in
accordance with the Company’s then established plans, programs, and practices.


 


9.                                    Covenants; Conditions to Receipt of
Severance; Mitigation.


 


(a)                               Nondisparagement.  During the Employment Term and for the twelve
(12) months thereafter, Executive will not, and will cause his relatives,
agents, and representatives to not, knowingly disparage, criticize, or
otherwise make any derogatory statements regarding the Company, its directors,
or its officers, and the Company will not knowingly disparage, criticize or
otherwise make any derogatory statements regarding Executive.  The Company’s obligations under the preceding
sentence shall be limited to communications by its senior corporate executives
having the rank of Senior Vice President or above and members of the
Board.  The foregoing restrictions will
not apply to any statements that are made truthfully in response to a subpoena
or other compulsory legal process. 
Payments of severance to Executive, in accordance with Section 8
above, shall immediately cease, and no further payments shall be made, in the
event that Executive materially breaches the provisions of this Section 9(a).


 


(b)                              Other Requirements.  Any general release of claims required to be
executed by Executive as a condition to the receipt of severance will be
consistent in substance with the releases of claims used at the time by the
Company in connection with separations of senior corporate executives
generally.


 


(c)                               Mitigation.  Payments of severance to Executive, in
accordance with Section 8 above, shall immediately cease, and no further
payments shall be made, in the event that (x) Executive materially
breaches the Confidential Information Agreement (provided, however, that
Executive’s right to future payments will be restored, and any omitted payments
will be made to Executive promptly, if the Board in its reasonable good faith
judgment determines that such breach is curable, and Executive cures the breach
to the reasonable satisfaction of the Board within 30 days of having been
notified thereof); or (y) Executive is employed or self-employed in any
gainful employment during the eighteen (18) month severance period,
irrespective of whether Executive receives current or deferred compensation,
without the prior consent of the Board, such consent to be withheld only if the
Board determines in good faith that it is reasonably likely that, in connection
with such employment, Executive would utilize or disclose material confidential
or proprietary information concerning the Company.  Executive agrees to cooperate with the
Company and to provide timely notice as to his activities following a
termination without Cause so that the Company may monitor its obligation under Section 8.


 


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10.                            Definitions.


 


(a)                               Cause.  For purposes of this Agreement, “Cause” will
mean (i) Executive’s material neglect (other than as a result of illness
or disability) of his duties or responsibilities to the Company or (ii) Executive’s
conduct (including action or failure to act) that Executive knew or should have
known is materially inconsistent with the best interests of, or is materially
injurious to, the Company.  Except for
actions or circumstances which, in the reasonable good faith judgment of the
Board cannot be cured, Executive will have thirty (30) calendar days from
Executive’s receipt of notice from the Company setting forth in reasonable
detail the circumstances constituting Cause within which to cure.  Executive’s termination of employment will
not be considered to be for Cause unless it is approved by a majority vote of
the members of the Board of Directors or an independent committee thereof.  It is understood that good faith decisions of
the Executive relating to the conduct of the Company’s business or the Company’s
business strategy will not constitute “Cause”.


 


(b)                              Disability.  For purposes of this Agreement, Disability
will mean Executive’s absence from his responsibilities with the Company on a
full-time basis for 180 calendar days in any consecutive twelve (12) months
period as a result of Executive’s mental or physical illness or injury.


 


11.                            Indemnification. 
Subject to applicable law, Executive will be provided indemnification to
the maximum extent permitted by the Company’s bylaws and Certificate of
Incorporation, including coverage, if applicable, under any directors and
officers insurance policies, with such indemnification determined by the Board
or any of its committees in good faith based on principles consistently applied
(subject to such limited exceptions as the Board may approve in cases of
hardship) and on terms no less favorable than provided to any other Company
executive officer or director.


 


12.                            Confidential Information. 
Executive will execute the Company’s Agreement Regarding Confidential
Information and Proprietary Developments appended hereto as Exhibit A (the
“Confidential Information Agreement”).


 


13.                            Assignment.  This Agreement will be binding
upon and inure to the benefit of (a) the heirs, executors, and legal
representatives of Executive upon Executive’s death, and (b) any successor
of the Company.  Any such successor of
the Company will be deemed substituted for the Company under the terms of this
Agreement for all purposes.  For this
purpose, “successor” means any person, firm, corporation, or other business
entity which at any time, whether by purchase, merger, or otherwise, directly
or indirectly acquires all or substantially all of the assets or business of the
Company.  None of the rights of Executive
to receive any form of compensation payable pursuant to this Agreement may be
assigned or transferred except by will or the laws of descent and distribution.  Any other attempted assignment, transfer,
conveyance, or other disposition of Executive’s right to compensation or other
benefits will be null and void.


 


14.                            Notices.  All notices, requests, demands,
and other communications called for hereunder will be in writing and will be
deemed given (a) on the date of delivery if delivered personally, (b) one
(1) day after being sent overnight by a well established commercial
overnight service, or (c) four (4) days after being mailed by
registered or certified mail, return receipt 


 


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requested, prepaid and addressed to the parties or
their successors at the following addresses, or at such other addresses as the
parties may later designate in writing:


 


If to the Company:


 


Attn: Chairman of the
HR/Compensation Committee


c/o Corporate Secretary


Hewlett-Packard Company


3000 Hanover Street


Palo Alto, CA 94304


 


If to Executive:


 


at the last residential
address known by the Company.


 


15.                            Severability.  If
any provision hereof becomes or is declared by a court of competent jurisdiction
to be illegal, unenforceable, or void, this Agreement will continue in full
force and effect without said provision.


 


16.                            Arbitration.  The Parties agree that any and
all disputes arising out of the terms of this Agreement, Executive’s employment
by the Company, Executive’s service as an officer or director of the Company,
or Executive’s compensation and benefits, their interpretation, and any of the
matters herein released, will be subject to binding arbitration in Santa Clara,
California before the Judicial Arbitration and Mediation Services, Inc.
under the American Arbitration Association’s National Rules for the
Resolution of Employment Disputes, supplemented by the California Rules of
Civil Procedure.  The Parties agree that
the prevailing party in any arbitration will be entitled to injunctive relief
in any court of competent jurisdiction to enforce the arbitration award.  The Parties hereby agree to waive their right
to have any dispute between them resolved in a court of law by a judge or jury.  This paragraph will not prevent either party
from seeking injunctive relief (or any other provisional remedy) from any court
having jurisdiction over the Parties and the subject matter of their dispute
relating to Executive’s obligations under this Agreement and the Confidential
Information Agreement.


 


17.                            Integration.  This Agreement, together with
the Confidential Information Agreement and the standard forms of equity award
grants that describe Executive’s outstanding equity awards, represents the entire
agreement and understanding between the parties as to the subject matter herein
and supersedes all prior or contemporaneous agreements whether written or
oral.  No waiver, alteration, or
modification of any of the provisions of this Agreement will be binding unless
in a writing and is signed by duly authorized representatives of the parties
hereto.  In entering into this Agreement,
no party has relied on or made any representation, warranty, inducement,
promise or understanding that is not in this Agreement.


 


18.                            Waiver of Breach.  The
waiver of a breach of any term or provision of this Agreement, which must be in
writing, will not operate as or be construed to be a waiver of any other
previous or subsequent breach of this Agreement.


 


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19.                            Survival.  The Confidential Information
Agreement and the Company’s and Executive’s responsibilities under Sections 7,
8, 9, 10, 11, 13, 14, 15 and 16 will survive the termination of this Agreement.


 


20.                            Headings.  All captions and Section headings
used in this Agreement are for convenient reference only and do not form a part
of this Agreement.


 


21.                            Tax Withholding.  All
payments made pursuant to this Agreement will be subject to withholding of
applicable taxes.


 


22.                            Governing Law.  This
Agreement will be governed by the laws of the State of California.


 


23.                            Acknowledgment. 
Executive acknowledges that he has had the opportunity to discuss this
matter with and obtain advice from his private attorney, has had sufficient time
to, and has carefully read and fully understands all the provisions of this
Agreement, and is knowingly and voluntarily entering into this Agreement.


 


24.                            Internal Revenue Code Section 409A. 
Notwithstanding any provision of this Agreement, this Agreement shall be
construed and interpreted to comply with Section 409A of the Internal
Revenue Code of 1986, as amended, and if necessary, any provision shall be held
null and void to the extent such provision (or part thereof) fails to comply
with Section 409A of the Code or regulations thereunder.  For purposes of the limitations on
nonqualified deferred compensation under Section 409A of the Code, each
payment of compensation under the Agreement shall be treated as a separate
payment of compensation for purposes of applying the Section 409A of the
Code deferral election rules and the exclusion from Section 409A of
the Code for certain short-term deferral amounts.  Any amounts payable solely on account of an
involuntary separation from service within the meaning of Section 409A of
the Code shall be excludible from the requirements of Section 409A of the
Code, either as involuntary separation pay or as short-term deferral amounts (e.g., amounts payable under the schedule
prior to March 15 of the calendar year following the calendar year of
involuntary separation) to the maximum possible extent.  If, as of the Date of Termination, Executive
is a “specified employee” as determined by the Company, then to the extent that
any amount or benefit that would be paid or provided to Executive under this
Agreement within six (6) months of his “separation from service” (as
determined under Section 409A) constitutes an amount of deferred
compensation for purposes of Section 409A and is considered for purposes
of Section 409A to be owed to Executive by virtue of his separation from
service, then such amount or benefit will not be paid or provided during the
six-month period following the date of Executive’s separation from service and
instead shall be paid or provided on the first business day that is at least
seven (7) months following the date of Executive’s separation from
service, except to the extent that, in the Company’s reasonable judgment,
payment during such six-month period would not cause Executive to incur
additional tax, interest or penalties under Section 409A.  Further, any reimbursements or in-kind
benefits provided under the Agreement shall be made or provided in accordance
with the requirements of Section 409A of the Code, including, where
applicable, the requirement that (i) any reimbursement is for expenses
incurred during the period of time specified in the Agreement, (ii) the
amount of expenses eligible for reimbursement, or in-kind benefits provided,
during a calendar year may not affect the expenses eligible for reimbursement, 


 


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or in-kind benefits to be provided, in any other
calendar year, (iii) the reimbursement of an eligible expense will be made
no later than the last day of the calendar year following the year in which the
expense is incurred, and (iv) the right to reimbursement or in-kind
benefits is not subject to liquidation or exchange for another benefit.


 


25.                            Counterparts.  This
Agreement may be executed in counterparts, and each counterpart will have the
same force and effect as an original and will constitute an effective, binding
agreement on the part of each of the undersigned.


 


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IN WITNESS WHEREOF, each
of the parties has executed this Agreement, in the case of the Company by a
duly authorized officer, on the day and year written below.


 


 


	
  COMPANY:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  HEWLETT-PACKARD COMPANY

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/ Lawrence T.
  Babbio, Jr.

  	
   

  	
  Date:
  September 29, 2010

  
	
  By:

  	
  Lawrence T.
  Babbio, Jr.

  	
   

  	
   

  
	
  Title:

  	
  Director and Chair of
  HR and Compensation Committee

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  EXECUTIVE:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/ Léo Apotheker

  	
   

  	
  Date:
  September 29, 2010

  
	
  LÉO APOTHEKER

  	
   

  	
   

  



 













 


Schedule
A


 


Board Memberships


 


Schneider Electric SA


 


PlaNet Finance (a French
not-for-profit association)


 


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