Exhibit 10(n)(n)
HP INC.
2005 EXECUTIVE DEFERRED COMPENSATION PLAN
(Amended and restated effective November 1, 2015)
The HP Inc. 2005 Executive Deferred Compensation Plan (formerly the Hewlett-Packard Company 2005 Executive Deferred Compensation Plan) is hereby amended and restated effective November 1, 2015 to permit Eligible Employees and Outside Directors to defer receipt of certain compensation and to provide matching contributions for certain employees who are not active participants in one of HP’s defined benefit retirement plans pursuant to the terms and provisions set forth below.
The Plan is intended: (1) to comply with Code section 409A and official guidance issued thereunder; and (2) with respect to the portion of the Plan covering Eligible Employees, to be “a plan which is unfunded and is maintained by an employer primarily for the purpose of providing deferred compensation for a select group of management or highly compensated employees” within the meaning of sections 201(2), 301(a)(3) and 401(a)(1) of ERISA. Notwithstanding any other provision of this Plan, this Plan shall be interpreted, operated and administered in a manner consistent with these intentions.
ARTICLE I: DEFINITIONS
Wherever used herein the following terms shall have the meanings hereinafter set forth:
“
Account
” means a bookkeeping account established by HP for (i) each Participant electing to defer Eligible Income under the Plan, and (ii) each Rollover Participant.
“
Actual Pay
” means “Covered Compensation” as defined in the 2000 restatement of the HP Inc. 401(k) Plan (formerly known as the Hewlett-Packard Company 401(k) Plan), and “Eligible Pay” as to be defined in the 2006 restatement of the HP Inc. 401(k) Plan, as each is amended from time to time, without giving effect to the Code section 401(a)(17) limitation set forth in each definition and the exclusion of pay deferred under this Plan.
“
Affiliate
” means any corporation or other entity that is treated as a single employer with HP under Code section 414.
“
Annual Rate of Pay
” means the annual rate of pay, which is the sum of an employee’s base pay and targeted incentive amount, as reflected in the compensation data in HP’s global database for human resources information, and as adjusted for such employee’s employment status, including part-time status.
“
Annual Retainer
” means the cash portion of any annual retainer paid to an Outside Director.
“
Beneficiary
” means the person or persons or trust designated by a Participant to receive any amounts payable under the Plan in the event of the Participant’s death. HP has established procedures governing the form and manner in which a Participant may designate a Beneficiary (the “2004 Procedures”). Only a Beneficiary designation submitted in accordance with the 2004 Procedures and that is received by HP before the death of the Participant shall be a valid Beneficiary designation. If there is no valid Beneficiary designation in effect upon the death of a Participant, any remaining Account balance shall be paid in the following order: (i) to that person’s spouse; (ii) if no spouse is living at the time of such payment, then to that person’s living children, in equal shares; (iii) if neither a spouse nor children are living, then to that person’s living parents, in equal shares; (iv) if neither spouse, nor children, nor parents are living, then to that person’s living brothers and sisters, in equal shares; and (v) if none of the individuals described in (i) through (iv) are living, to that person’s estate. A person’s domestic partner
shall be considered a person’s spouse for purposes of this paragraph. HP shall determine a person’s status as a domestic partner in a uniform and nondiscriminatory manner.
“
Bonus Eligible Employee
” means an individual who is an Employee on November 1 preceding the Plan Year within which deferrals are to be made (1) who satisfies both of the following conditions: (i) whose job position has a title of Director (or whose job function is, in the sole and absolute discretion of HP, equivalent to a ‘Director’ position) and (ii) whose Annual Rate of Pay is equal to or greater than the dollar limit for highly compensated employees as defined in Section 414(q)(1)(B)(i) of the Code plus $30,000, or (2) whose job position has a title of Executive Vice President or above, irrespective of such Employee’s Annual Rate of Pay.
“
Code
” means the Internal Revenue Code of 1986, as amended.
“
Code Section 401(a)(17) Limit
” means the amount specified under Code section 401(a)(17) in effect on January 1 of the Plan Year.
“
Committee
” means the HR and Compensation Committee of HP’s Board of Directors.
“
Deferral Form
” means a written or electronic form provided by HP pursuant to which an Eligible Employee or Outside Director may elect to defer amounts under the Plan.
“
Director
” means the title for an employee who has a job grade of DIR1 and above.
“
EBP
” means the Hewlett-Packard Company Excess Benefit Retirement Plan, as amended from time to time.
“
Eligible Employee
” means an individual who is (i) a Bonus Eligible Employee, (ii) a Match Eligible Employee (for Plan Years after 2005), (iii) an Employee whose Annual Rate of Pay, as of the first day of November preceding the Plan Year within which the deferral is to be made, exceeds the Code Section 401(a)(17) Limit for the Plan Year in which the deferral is to be made, or (iv) a combination or all of the foregoing. An individual’s status as an Eligible Employee shall be determined by HP in its sole discretion.
Effective October 1, 2006 and solely for purposes of the October 2006 special enrollment period for Employees who participate in the 2004 and 2005 (Spring) Long-Term Performance Cash Programs and are otherwise eligible to participate in this Plan, the date to determine enrollment eligibility shall be September 15, 2006 rather than November 1, 2006.
An Eligible Employee shall also include a Newly Hired Employee and a Late Year Newly Hired Employee.
“
Eligible Income
” means Actual Pay, Annual Retainer and Incentive Awards.
“
Employee
” means an individual who is a regular employee on the U.S. payroll of HP or its Affiliates, other than a temporary or intermittent employee. The term “Employee” shall not include a person hired as an independent contractor, leased employee, consultant, or a person otherwise designated by HP or an Affiliate as not eligible to participate in the Plan, even if such person is determined to be an “employee” of HP or an Affiliate by any governmental or judicial authority.
“
EPfR Plan
” means the Hewlett-Packard Company Executive Pay-for-Results Plan, as amended from time to time.
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“
ERISA
” means the Employee Retirement Income Security Act of 1974, as amended.
“
HP
” means HP Inc. or any successor corporation or other entity.
“
HP Matching Contributions
” means the matching contributions as defined in Section 4.1.
“
Incentive Award
” means an amount payable to an Eligible Employee under a cash bonus or incentive compensation plan of HP or an Affiliate that the Committee has deemed eligible for deferral, including bonuses paid under the EPfR Plan, the PfR Plan, and the VPB Plan.
“
Investment Options
” means the investment options, as determined from time to time by HP, used to credit earnings, gains and losses on Account balances.
“
Key Employee
” means an Employee who at Termination of Employment is treated as a “specified employee” under Code section 409A(a)(2)(B)(i), i.e., a key employee (as defined in Code section 416(i) without regard to paragraph (5) thereof) of a corporation the stock of which is publicly traded on an established securities market or otherwise. HP shall determine which Employees will be deemed a Key Employee for purposes of this Plan during a Plan Year based on the twelve-month period ending on the September 30 prior to the Plan Year.
“
Late Year Newly Hired Employee
” means an Employee (i) who is hired in November or December and (ii) who would have qualified as an Eligible Employee as of the November 1 preceding his date of hire based on his initial position and Annual Rate of Pay.
“
Match Eligible Employee
” means an individual (i) who is eligible for a matching contribution under the HP Inc. 401(k) Plan, and (ii) whose Annual Rate of Pay, as of the first day of November preceding the Plan Year within which the deferral is to be made, exceeds the Code Section 401(a)(17) Limit for such Plan Year.
“
Newly Hired Employee
” means an Employee (i) who would have qualified as an Eligible Employee as of the November 1 preceding his date of hire based on his initial position and Annual Rate of Pay, and (ii) whose base salary payable in the year of hire is projected to exceed the Code section 401(a)(17) limit for such year; provided, however, that an individual who has previously worked for the Company or an Affiliate will only qualify as a “Newly Hired Employee” if he meets the requirements of Treas. Reg. § 1.409A-2(a)(7) or any successor thereto. Generally, a re-hired individual will meet these requirements if (1) he has been paid any and all amounts due him under the Plan (and any plans required to be aggregated with the Plan under Code section 409A) prior to re-hire, or (2) he has not been eligible to participate, other than the accrual of earnings, in the Plan (or any other plan required to be aggregated with the Plan under Code section 409A) for at least 24 months.
“
Outside Director
” means an individual who is a member of HP’s Board of Directors and not an Employee of HP.
“
Participant
” means an Eligible Employee or Outside Director who elects or has elected to defer amounts under the Plan.
“
PfR Plan
” means the Hewlett-Packard Company Pay-for-Results Short-Term Bonus Plan, as amended from time to time.
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“
Plan
” means this HP Inc. 2005 Executive Deferred Compensation Plan, as set forth herein and as amended from time to time.
“
Plan Committee
” means the committee to which the Committee delegates certain authority to act on various compensation and benefit matters.
“
Plan Year
” means January 1 through December 31.
“
Retirement Date
” means the date on which a Participant has completed at least 15 years of service, as measured from such Participant’s last hire date, and has attained age 55.
“
Rollover Participant
” means an individual with an Account in the Plan transferred from either (i) a Rollover Plan in accordance with the provisions of Article IX or (ii) the EBP. The term Rollover Participant may also refer to an individual who has previously been a Participant in the Plan, or an existing Participant at the time of transfer.
“
Rollover Plan
” means either (1) a nonqualified deferred compensation plan of a business entity acquired by HP or an Affiliate through acquisition of a majority of the voting interest in, or substantially all of the assets of, such entity, or (2) any plan or program of HP or an Affiliate pursuant to the termination of which an Account is established for a Participant or Rollover Participant.
“
Termination Date
” means the date on which the Participant experiences a “separation from service” as defined under Code section 409A.
“
Termination of Employment
” or “
Terminates Employment
” means a “separation from service” with HP and its Affiliates as defined under Code section 409A.
“
VPB Plan
” means the Hewlett-Packard Company Variable Performance Bonus Plan, as amended from time to time.
ARTICLE II: PARTICIPATION
Participation in the Plan shall be limited to Eligible Employees and Outside Directors. HP shall notify any Employee of his status as an Eligible Employee at such time and in such manner as HP shall determine. An Eligible Employee or Outside Director shall become a Participant by making a deferral election under Article III.
ARTICLE III: PARTICIPANT ACCOUNTS
3.1
Employee Deferral Elections
. Deferrals may be made by an Eligible Employee with respect to the following types of Eligible Income, as permitted by HP:
(a)
Annual Rate of Pay
.
(i)
An Eligible Employee whose Annual Rate of Pay, as of the first day of November preceding the Plan Year within which the deferral is to be made, exceeds the Code Section 401(a)(17) Limit for the Plan Year in which the deferral is to be made, may elect to defer a portion of his Actual Pay. In order to elect to defer Annual Rate of Pay
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earned during a Plan Year, an Eligible Employee shall submit an irrevocable Deferral Form with HP before the beginning of such Plan Year.
(ii)
The portion of his Annual Rate of Pay that an Eligible Employee elects to defer for a Plan Year shall be stated as a whole dollar amount. The minimum amount of Annual Rate of Pay that an Eligible Employee may elect to defer in a Plan Year is $1,200. The maximum amount is equal to the greater of $1,200 or the Eligible Employee’s Annual Rate of Pay that exceeds the Code Section 401(a)(17) Limit. If the Internal Revenue Service does not publish the Code Section 401(a)(17) Limit for the Plan Year prior to enrollment, HP has the discretion to determine eligibility to elect to defer Annual Rate of Pay; provided, however, if a Participant is determined to be ineligible to elect to defer Annual Rate of Pay under paragraph (i) above for a Plan Year, any Annual Rate of Pay deferrals the Participant elected for the Plan Year shall be void (including, without limitation, deferrals made during the October 2006 special enrollment period).
(iii)
The deferral amount designated by an Eligible Employee will be deducted in equal installments over the pay periods falling within the Plan Year to which the election pertains.
(b)
Incentive Awards
. A Bonus Eligible Employee may elect to defer any portion of an Incentive Award up to 95%, expressed as whole percentage points. In order to elect to defer an Incentive Award, a Bonus Eligible Employee shall submit an irrevocable Deferral Form with HP before the beginning of the Plan Year in which the performance period to which Incentive Award pertains begins, in accordance with procedures that HP determines in its discretion. Notwithstanding the foregoing, if HP determines that a Bonus Eligible Employee may elect to defer a portion of the Incentive Award at a later time under Code section 409A, a Bonus Eligible Employee may elect to defer a portion of the Incentive Award by filing an irrevocable Deferral Form at such later time as determined by HP in accordance with Code section 409A.
3.2
New Hires
. A Newly Hired Employee may elect within 30 days of becoming an Employee to defer base salary earned subsequent to the deferral election becoming effective and in the year of hire. Such an election shall become irrevocable and effective at the end of this 30-day period.
3.3
Late Year New Hires
. A Late Year Newly Hired Employee may elect within the later of 30 days of becoming an Employee or the end of the calendar year in which he is hired to defer base salary earned in the Plan Year following his year of hire. Such an election shall become irrevocable and effective at the end of this election period and shall apply to base salary earned subsequent to the deferral election’s becoming effective.
3.4
Outside Director Deferral Elections.
In order to elect to defer a portion of his Annual Retainer earned during a Plan Year, an Outside Director shall submit an irrevocable Deferral Form with HP before the beginning of such Plan Year, but no earlier than the first day of November preceding the Plan Year within which the deferral is to be made. The portion of his Annual Retainer that an Outside Director elects to defer for a Plan Year shall be stated as a whole dollar amount. Any failure to make an election shall be deemed to be an election for the same deferral amount and the same distribution date and form of payment for the following Plan Year as were in effect for such Outside Director for the current Plan Year.
3.5
Crediting of Deferrals
. Eligible Income deferred by a Participant under the Plan shall be credited to the Participant’s Account as soon as administratively practicable after the amounts would have otherwise been paid to the Participant.
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3.6
Vesting on Eligible Income
. A Participant shall at all times be 100% vested in any Eligible Income deferred under this Plan and credited to his Account.
3.7
Administrative Charges
. The administrative cost associated with this Plan may be debited to a Participant’s Account in a manner determined by the Plan Committee or its designee, in its sole discretion.
ARTICLE IV: MATCH ON DEFERRALS
4.1
HP Matching Contributions.
At the end of each Plan Year beginning with the 2006 Plan Year, HP shall credit a Match Eligible Employee’s Account with HP Matching Contributions. The HP Matching Contributions shall be applied only to the extent that the Match Eligible Employee’s Actual Pay exceeds the Code Section 401(a)(17) Limit for the Plan Year, and the rate of HP Matching Contributions shall be equal to the weighted average of the various rates that applied (or would have applied) to such Employee under the HP Inc. 401(k) Plan for the Plan Year, determined as if such Employee had participated in the 401(k) Plan for the entire Plan Year. Notwithstanding the foregoing, the maximum amount of HP Matching Contributions for a Plan Year for a Match Eligible Employee shall not exceed the maximum amount of match for which such Employee would be eligible under the HP Inc. 401(k) Plan for the Plan Year.
4.2
Crediting of HP Matching Contributions.
HP Matching Contributions for a Plan Year shall be credited to the Accounts of Match Eligible Employees as soon as administratively practicable after the end of the Plan Year. The Account of a Participant shall be credited with HP Matching Contributions for a Plan Year only if such Participant has not terminated employment with HP and its Affiliates prior to the end of the Plan Year, unless such termination is due to death, disability or is after Participant’s Retirement Date.
4.3
Vesting of HP Matching Contributions.
(a)
Vesting Schedule.
A Participant’s interest in HP Matching Contributions shall vest as follows:
(i)
For Participants who were hired by HP or an Affiliate prior to January 1, 2006, the Participant will be fully vested in HP Matching Contributions credited to such Participant’s Account.
(ii)
For Participants who were hired by HP or its Affiliates on or after January 1, 2006, the Participant will be vested in HP Matching Contributions credited to such Participant’s Account when such Participant would be vested in HP Matching Contributions credited to his or her account under the HP Inc. 401(k) Plan. Notwithstanding the foregoing, a Participant will be fully vested in HP Matching Contributions credited to his or her Account if the Participant’s employment with HP and its Affiliates is terminated (A) due to death or disability, (B) after the Participant has reached his or her Retirement Date, (C) if the Participant is a “Qualified Participant” as defined in the 2007 U.S. Enhanced Early Retirement Program (the “2007 EER Program”) and terminates employment in connection with all of the terms and conditions of the 2007 EER Program, or (D) if the Participant terminates employment from HP or an Affiliate in connection with a sale or other disposition by HP or the Affiliate of the business unit in which the Participant had been employed.
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(b)
Forfeiture of HP Matching Contributions.
Except as otherwise provided above, upon termination of employment with HP and its Affiliates, a Participant shall forfeit the nonvested portion of his or her Account and applicable earnings thereon.
ARTICLE V: INVESTMENT OPTIONS, EARNINGS CREDITED AND DISTRIBUTION OF ACCOUNT BALANCE
5.1
Investment Options and Earnings
(a)
Investment Options and Procedures.
HP shall select the Investment Options to be available under the Plan, and shall specify procedures by which a Participant may make an election as to the deemed investment of amounts credited to his Accounts among the Investment Options, as well as the procedures by which a Participant may change his investment selection. Nothing in this Plan, however, will require HP to invest any amounts in such Investment Options or otherwise.
(b)
Earnings
. HP shall periodically credit gains, losses and earnings to a Participant’s Account, until the full balance of the Account has been distributed. Amounts shall be credited to a Participant’s Account under this Section based on the results that would have been achieved had amounts credited to the Account been invested as soon as practicable after crediting into the Investment Options selected by the Participant.
Any portion of an Incentive Award that qualifies as “performance-based compensation” under Code section 162(m) and is deferred under the Plan by a Participant who qualifies as a “covered employee” under Code section 162(m) shall be credited with earnings and otherwise administered in a manner so that the ultimate payment(s) of the deferred amount remains so qualified.
5.2
Time and Form of Payment Elections
(a)
The Deferral Form
. Each Deferral Form shall specify the date on which payment of the aggregate of the deferred amount and any HP Matching Contributions for the Plan Year (and earnings thereon) is to commence. Such payment date shall be at least three (3) years after the Plan Year in which the deferrals are being made. Each Deferral Form shall also specify the form for payment of the deferred amount and any HP Matching Contributions for the Plan Year (and earnings thereon). A Participant may elect payment in the form of a single lump sum payment or annual installment payments for a period of not less than two (2) but no more than fifteen (15) years. Annual installment payments will be paid once a year beginning on the date specified on the applicable Deferral Form or as otherwise provided herein.
(i)
Default Elections
. If a Participant fails to specify the date on which payment of the deferred amount and any HP Matching Contributions for the Plan Year (and earnings thereon) is to commence, then Participant will be deemed to have elected distribution at Participant’s Termination Date, subject to Sections 5.3 or 5.4 below. If a Participant fails to make an effective payment form designation on a Deferral Form, the amount deferred and any HP Matching Contributions for the Plan Year (and earnings thereon) under such Deferral Form will be distributed in a single lump sum in the year elected.
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(b)
Payment shall be made in January of the year that a Participant elects for a distribution.
(c)
A Participant may also elect on a Deferral Form that payments of that Plan Year’s deferrals and any HP Matching Contributions (and earnings thereon) shall be paid in January of the year following the year in which the Participant’s Termination Date occurs (in the case of installment payments, the first installment shall be paid in the January following the Participant’s Termination Date, and subsequent installments shall be made each January thereafter), if the Participant’s Termination Date is after his Retirement Date or the Participant is an Outside Director.
(d)
Except for Participants who are Outside Directors, if a Participant’s Termination Date precedes his or her Retirement Date, such Participant shall be deemed to have elected on each Deferral Form that such Plan Year’s deferrals and any HP Matching Contributions (and earnings thereon) shall be paid in a single lump sum at the following time, subject to Section 5.3 below: (i) with respect to amounts attributable to Plan Years commencing before January 1, 2008, in the month following the month in which the Participant Terminates Employment, and (ii) with respect to amounts attributable to Plan Years commencing on or after January 1, 2008, in January of the year following the year in which the Participant Terminates Employment.
5.3
Automatic Distributions
. Notwithstanding any payment elections made on Deferral Forms and Section 5.2:
(a)
Distributions to Key Employees
. Distributions may not commence to a Key Employee upon a Termination of Employment before the date which is six months after the date of the Key Employee’s Termination of Employment. If distributions are to be paid in a lump sum, such lump sum payment shall be distributed as follows: (i) with respect to amounts attributable to Plan Years commencing before January 1, 2008, in the seventh month after the Termination of Employment, and (ii) with respect to amounts attributable to Plan Years commencing on or after January 1, 2008, in the later of (A) the seventh month after the Termination of Employment or (B) January of the year following the year of the Termination of Employment. If distributions are to be paid in installments and the first installment is payable during this six-month period, such installment shall be distributed as follows: (x) with respect to amounts attributable to Plan Years commencing before January 1, 2008, in the seventh month after the Termination of Employment, and (y) with respect to amounts attributable to Plan Years commencing on or after January 1, 2008, in the later of (I) the seventh month after the Termination of Employment or (II) January of the year following the year of the Termination of Employment, with subsequent installments to be made each January thereafter.
(b)
Distributions Upon Death
. If a Participant dies before full distribution of his Account balance, any balance shall be distributed in a lump sum payment to the Participant’s Beneficiary in the month following the month in which the Participant’s death occurs.
5.4
Withdrawals for Unforeseeable Emergency
. Upon approval by the Plan Committee, a Participant may withdraw all or any portion of his vested Account balance for an Unforeseeable Emergency. The amounts distributed with respect to an Unforeseeable Emergency may not exceed the amounts necessary to satisfy such Unforeseeable Emergency plus amounts necessary to pay taxes reasonably anticipated as a result of the distribution, after taking into account the extent to which such hardship is or may be relieved through reimbursement or compensation by insurance or otherwise or by liquidation of the Participant’s assets (to the extent the liquidation of such assets would not itself cause severe financial hardship) or by cessation of deferrals under this Plan. “Unforeseeable Emergency”
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means for this purpose a severe financial hardship to a Participant resulting from an illness or accident of the Participant, the Participant’s spouse, or a dependent (as defined in Code section 152(a)) of the Participant, loss of the Participant’s property due to casualty, or other similar extraordinary and unforeseeable circumstances arising as a result of events beyond the control of the Participant. For the avoidance of doubt, a circumstance does not constitute an “Unforeseeable Emergency” for purposes of the Plan unless such circumstance constitutes an “unforeseeable emergency” as defined in Treas. Reg. § 1.409A-3(i)(3). The amount withdrawn for an Unforeseeable Emergency is subject to a minimum of $10,000.
Notwithstanding Section 3.1, if the Plan Committee approves a distribution under this Section, the Participant’s deferrals under the Plan shall cease. The Participant will be allowed to enroll if eligible at the beginning of the next enrollment period following six (6) months after the date of distribution.
5.5
Effect of Taxation
. If the Internal Revenue Service or a court of competent jurisdiction determines that Plan benefits are includible in the gross income of a Participant under Code section 409A prior to actual receipt of the benefits, HP shall immediately distribute the benefits found to be so includible to the Participant.
ARTICLE VI: ADMINISTRATION
6.1
General Administration
. The Plan Committee shall be responsible for the operation and administration of the Plan and for carrying out the provisions hereof. The Plan Committee shall have the full authority and discretion to make, amend, interpret, and enforce all appropriate rules and regulations for the administration of this Plan and decide or resolve any and all questions, including interpretations of this Plan, as may arise in connection with this Plan. Any such action taken by the Plan Committee shall be final and conclusive on any party. The Plan Committee’s prior exercise of discretionary authority shall not obligate it to exercise its authority in a like fashion thereafter. The Committee and the Plan Committee shall be entitled to rely conclusively upon all tables, valuations, certificates, opinions and reports furnished by any actuary, accountant, controller, counsel or other person employed or engaged by HP with respect to the Plan. The Committee and the Plan Committee may, from time to time, delegate to others, including employees of HP, such administrative duties as it sees fit.
6.2
Claims for Benefits
: The following applies to Participants who are not Outside Directors:
(a)
Filing a Claim
. A Participant or his authorized representative may file a claim for benefits under the Plan. Any claim must be in writing and submitted to the Plan Committee or its delegate at such address as may be specified from time to time. Claimants will be notified in writing of approved claims, which will be processed as claimed. A claim is considered approved only if its approval is communicated in writing to a claimant.
(b)
Denial of Claim
. In the case of the denial of a claim respecting benefits paid or payable with respect to a Participant, a written notice will be furnished to the claimant within 90 days of the date on which the claim is received. If circumstances (such as for a meeting) require a longer period, the claimant will be notified in writing, prior to the expiration of the 90-day period, of the reasons for an extension of time; provided, however, that no extensions will be permitted beyond 90 days after the expiration of the initial 90-day period.
(c)
Reasons for Denial
. A denial or partial denial of a claim will be dated and signed on behalf of the Plan Committee and will clearly set forth:
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(i)
the specific reason or reasons for the denial;
(ii)
specific reference to pertinent Plan provisions on which the denial is based;
(iii)
a description of any additional material or information necessary for the claimant to perfect the claim and an explanation of why such material or information is necessary; and
(iv)
an explanation of the procedure for review of the denied or partially denied claim set forth below, including the claimant’s right to bring a civil action under ERISA section 502(a) following an adverse benefit determination on review.
(d)
Review of Denial
. Upon denial of a claim, in whole or in part, a claimant or his duly authorized representative will have the right to submit a written request to the Plan Committee for a full and fair review of the denied claim by filing a written notice of appeal with the Plan Committee within 60 days of the receipt by the claimant of written notice of the denial of the claim. A claimant or the claimant’s authorized representative will have, upon request and free of charge, reasonable access to, and copies of, all documents, records, and other information relevant to the claimant’s claim for benefits and may submit issues and comments in writing, except for privileged or confidential documentation. The review will take into account all comments, documents, records, and other information submitted by the claimant relating to the claim, without regard to whether such information was submitted or considered in the initial benefit determination.
If the claimant fails to file a request for review within 60 days of the denial notification, the claim will be deemed abandoned and the claimant precluded from reasserting it. If the claimant does file a request for review, his request must include a description of the issues and evidence he deems relevant. Failure to raise issues or present evidence on review will preclude those issues or evidence from being presented in any subsequent proceeding or judicial review of the claim.
(e)
Decision Upon Review
. The Plan Committee or its delegate will provide a written decision on review. If the claim is denied on review, the decision shall set forth:
(i)
the specific reason or reasons for the adverse determination;
(ii)
specific reference to pertinent Plan provisions on which the adverse determination is based;
(iii)
a statement that the claimant is entitled to receive, upon request and free of charge, reasonable access to, and copies of, all documents, records, and other information relevant to the claimant’s claim for benefits; and
(iv)
a statement describing any voluntary appeal procedures offered by the Plan and the claimant’s right to obtain the information about such procedures, as well as a statement of the claimant’s right to bring a civil action under ERISA section 502(a).
A decision will be rendered no more than 60 days after the receipt of the request for review, except that such period may be extended for an additional 60 days if the Plan Committee determines that circumstances (such as for a meeting) require such extension. If an
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extension of time is required, written notice of the extension will be furnished to the claimant before the end of the initial 60-day period.
(f)
Finality of Determinations; Exhaustion of Remedies
. To the extent permitted by law, decisions reached under the claims procedures set forth in this Section shall be final and binding on all parties. No legal action for benefits under the Plan shall be brought unless and until the claimant has exhausted his remedies under this Section. In any such legal action, the claimant may only present evidence and theories which the claimant presented during the claims procedure. Any claims which the claimant does not in good faith pursue through the review stage of the procedure shall be treated as having been irrevocably waived. Judicial review of a claimant’s denied claim shall be limited to a determination of whether the denial was an abuse of discretion based on the evidence and theories the claimant presented during the claims procedure. Any suit or legal action initiated by a claimant under the Plan must be brought by the claimant no later than one year following a final decision on the claim for benefits. Notwithstanding the foregoing, in no event may a claimant initiate suit or legal action more than two years after the facts giving rise to the action occurred. The foregoing limitations on suits or legal actions for benefits will apply in any forum where a claimant initiates such suit or legal action.
ARTICLE VII: AMENDMENT AND TERMINATION
7.1
Amendment or Termination
. HP reserves the right to amend or terminate the Plan when, in the sole discretion of HP, such amendment or termination is advisable, pursuant to a resolution or other action taken by the Committee.
Any amendment or termination of the Plan will not affect the entitlement of any Participant or the Beneficiary of a Participant whose Termination Date occurs before the amendment or termination. All benefits to which any Participant or Beneficiary may be entitled shall be determined under the Plan as in effect at the time of the Participant’s Termination Date and shall not be affected by any subsequent change in the provisions of the Plan; provided, that HP reserves the right to change the Investment Options with respect to any Participant or Beneficiary. Participants and Beneficiaries will be given notice prior to the discontinuance of the Plan, change in Investment Options available or reduction of any benefits provided by the Plan.
7.2
Effect of Amendment or Termination
. No amendment or termination of the Plan shall adversely affect the rights of any Participant to amounts credited to his Account as of the effective date of such amendment or termination. Upon termination of the Plan, distribution of balances in Accounts shall be made to Participants and Beneficiaries in the manner and at the time described in Article V, unless HP determines in its sole discretion that all such amounts shall be distributed upon termination in accordance with the requirements under Code section 409A. Upon termination of the Plan, no further deferrals of Eligible Income shall be permitted; however, earnings, gains and losses shall continue to be credited to Account balances in accordance with Article V until the Account balances are fully distributed.
ARTICLE VIII: GENERAL PROVISIONS
8.1
Rights Unsecured
. The right of a Participant or his Beneficiary to receive a distribution hereunder shall be an unsecured claim against the general assets of HP, and neither the Participant nor his Beneficiary shall have any preferred rights in or against any amount credited to any Account or any other assets of HP. The Plan at all times shall be considered entirely unfunded for tax purposes. Any funds set
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aside by HP for the purpose of meetings its obligations under the Plan, including any amounts held by a trustee, shall continue for all purposes to be part of the general assets of HP and shall be available to its general creditors in the event of HP’s bankruptcy or insolvency. HP’s obligation under this Plan shall be that of an unfunded and unsecured promise to pay money in the future.
8.2
No Guarantee of Benefits
. Nothing contained in the Plan shall constitute a guarantee by HP or any other person or entity that the assets of HP will be sufficient to pay any benefits hereunder.
8.3
No Enlargement of Rights
. No Participant or Beneficiary shall have any right to receive a distribution under the Plan except in accordance with the terms of the Plan. Establishment of the Plan shall not be construed to give any Participant the right to continue to be employed by or provide services to HP.
8.4
Transferability
. No interest of any person in, or right to receive a distribution under, the Plan shall be subject in any manner to sale, transfer, assignment, pledge, attachment, garnishment, or other alienation or encumbrance of any kind; nor may such interest or right to receive a distribution be taken, either voluntarily or involuntarily for the satisfaction of the debts of, or other obligations or claims against, such person.
8.5
Applicable Law
. To the extent not preempted by federal law, the Plan shall be governed by the laws of the State of Delaware.
8.6
Incapacity of Recipient
. If any person entitled to a distribution under the Plan is deemed by HP to be incapable of personally receiving and giving a valid receipt for such payment, then, unless and until a claim for such payment shall have been made by a duly appointed guardian or other legal representative of such person, HP may provide for such payment or any part thereof to be made to any other person or institution then contributing toward or providing for the care and maintenance of such person. Any such payment shall be a payment for the account of such person and a complete discharge of any liability of HP and the Plan with respect to the payment.
8.7
Taxes
. HP or other payor may withhold from a benefit payment under the Plan or a Participant’s wages any federal, state, or local taxes required by law to be withheld with respect to a payment or accrual under the Plan, and shall report such payments and other Plan-related information to the appropriate governmental agencies as required under applicable laws.
8.8
Corporate Successors
. The Plan and the obligations of HP under the Plan shall become the responsibility of any successor to HP by reason of a transfer or sale of substantially all of the assets of HP or by the merger or consolidation of HP into or with any other corporation or other entity.
8.9
Unclaimed Benefits
. Each Participant shall keep HP informed of his current address and the current address of his designated Beneficiary. HP shall not be obligated to search for the whereabouts of any person if the location of a person is not made known to HP.
8.10
Severability
. In the event any provision of the Plan shall be held invalid or illegal for any reason, any illegality or invalidity shall not affect the remaining parts of the Plan, but the Plan shall be construed and enforced as if the illegal or invalid provision had never been inserted.
8.11
Words and Headings
. Words in the masculine gender shall include the feminine and the singular shall include the plural, and vice versa, unless qualified by the context. Any headings used herein are included for ease of reference only, and are not to be construed so as to alter the terms hereof.
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8.12
Liabilities Transferred to HPE
. HP distributed its interest in Hewlett Packard Enterprise Company (“HPE”) to its shareholders on or about November 1, 2015 (the “HPE Distribution Date”). Pursuant to an agreement between HP and HPE, on the HPE Distribution Date certain employees and former employees of HPE ceased to participate in the Plan and the liabilities for these participants’ benefits under the Plan were transferred to HPE. On and after the HPE Distribution Date, HP, the Plan, any directors, officers, or employees of HP, and any successors thereto, shall have no further obligation or liability to any such participant with respect to any benefit, amount, or right due under the Plan.
ARTICLE IX: ROLLOVERS FROM OTHER PLANS
9.1
Discretion to Accept
. The Committee shall have complete authority and discretion, but no obligation, to establish an Account for a Rollover Participant and credit the Account with the amount transferred from the Rollover Participant’s account in a Rollover Plan, except that the Committee shall establish an Account for a Rollover Participant for whom benefits and liabilities have been transferred to this Plan from the EBP. Amounts credited to such Accounts are fully subject to the provisions of this Plan; provided, however, that a Rollover Participant from the EBP shall be deemed to have elected to invest his Account in the Stable Value Fund if such Rollover Participant fails to make an investment election. Reference in the Plan to such a crediting as a “rollover” or “transfer” from a Rollover Plan or the EBP is nominal in nature, and confers no additional rights upon a Rollover Participant other than those specifically set forth in the Plan.
9.2
Status of Rollover Participants
. A Rollover Participant and his Beneficiary are fully subject to the provisions of this Plan, except as otherwise expressly set forth herein. A Rollover Participant who is not already a Participant in the Plan and is not otherwise eligible to participate in the Plan at the time of rollover, shall not be entitled to make any additional deferrals under the Plan unless and until he has become eligible to do so under the terms of the Plan.
9.3
Payments to Rollover Participants
. Payments from a Rollover Participant’s Account shall be made in accordance with the form and timing of payment provisions of the Rollover Plan or the EBP, as applicable.
IN WITNESS WHEREOF, HP INC.
has caused this HP Inc. 2005 Executive Deferred Compensation Plan, as amended and restated effective November 1, 2015, to be executed on this day of , 2015.
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HP INC.
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/s/ Tracy Keogh
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Tracy Keogh
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Chief Human Resources Officer
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Exhibit 10(o)(o)
HP Inc.
Severance and
Long-Term Incentive Change in Control Plan
for Executive Officers
As amended and restated effective November 1, 2015
1.
Eligibility
. This Severance and Long-Term Incentive Change in Control Plan for Executive Officers (“Plan”) is applicable to individuals who are Executive Officers (as defined below), effective for terminations and Changes in Control occurring on or after November 1, 2015. “Executive Officer” means a person who is employed by HP Inc. or a subsidiary (“HP”) and who (a) is an executive officer of HP within the meaning of Section 16 of the Securities and Exchange Act of 1934, as amended (“Section 16 Officer”) or a Participating EC Member (as defined below) on, or was a Section 16 Officer or a Participating EC Member within 90 days before, his or her termination of employment, or (b) is a Section 16 Officer or a Participating EC Member upon the occurrence of, or was a Section 16 Officer or a member of the Executive Committee within 90 days prior to, a Change in Control, as defined below. A “Participating EC Member” is an individual who is (and remains) a member of the Executive Council but is not a Section 16 Officer, who is designated as eligible for the Plan by the Chief Executive Officer of HP and whose eligibility is approved by the HR & Compensation Committee of the Board of Directors of HP (such Board the “Board” and such Committee the “Committee”).
2.
Severance Benefits outside a Change in Control
. In the event of a Qualifying Termination (as defined below) prior to or more than 24 months following a Change in Control, and subject to the Executive Officer’s execution of a full release of claims in a form satisfactory to HP (“Release of Claims”) within 45 days following termination of employment, and provided there has been no revocation or attempted revocation of the Release of Claims during the statutory revocation period (the date after the lapse of such revocation period without a revocation or attempted revocation, the “Release Effective Date”) and subject to the terms of this Plan, an Executive Officer will be eligible for severance benefits consisting of (a) a cash severance payment, (b) a pro-rata annual bonus payment, (c) pro-rata vesting on any outstanding awards under a long-term incentive plan (“LTIP”)(each, an “Award”), and (d) a health benefit stipend, all as more fully described below.
(a)
Cash Severance
: The cash severance payment shall be calculated as a multiple of the sum of the Executive Officer’s (i) annual base salary as in effect immediately before termination of employment, and (ii) the average of the actual annual cash bonuses paid under the applicable annual bonus plan for the three fiscal years most recently completed (or actual completed fiscal years, if less) prior to termination of employment.
(i)
For an Executive Officer whose highest title held within 90 days before termination was Chief Executive Officer, the multiple shall be two; and
(ii)
For an Executive Officer whose highest title held within 90 days before termination was Executive 1, the multiple shall be 1.5. For avoidance of doubt the Executive 1 must also have been a Section 16 Officer or a Participating EC Member; and
(iii)
For an Executive Officer whose highest title held within 90 days before termination was Executive 2, the multiple shall be one. For avoidance of doubt the Executive 2 must also have been a Section 16 Officer or a Participating EC Member.
(b)
Pro-Rata Annual Bonus
: The pro-rata annual bonus payment shall be calculated as a pro-rata portion of the annual (short-term) bonus for the fiscal year in which termination occurs, based on the number of days worked in the fiscal year in which termination occurs through the date of termination, divided by 365, and subject to actual performance on the applicable metrics, and to discretionary adjustments permitted under the applicable plan, as certified by the Committee following the end of the fiscal year.
(c)
Long-Term Incentive Awards
:
(i)
Each separately-granted Award held by an Executive Officer at the time of his or her Qualifying Termination that vests solely based on service will receive pro-rata vesting based on the number of full months worked during the vesting period applicable to such Award. Pro-rata vesting, where applicable, shall be applied separately to each separately-granted Award in its entirety and thus shall take into account amounts previously vested.
(ii)
Each separately-granted Award held by an Executive Officer at the time of his or her Qualifying Termination that vests solely based on performance will be deemed earned as of the end of the applicable performance period based on actual results as certified by the Committee, and subject to discretionary adjustments permitted under the applicable plan, if any, and will receive pro-rata vesting as described in the preceding sentence and application of the pro-rata vesting to the entire separately-granted Award, taking into account amounts, if any, previously vested.
(iii)
Vesting for Awards not specifically addressed above, including Awards subject to both time-based and performance-based vesting, may be illustrated in Appendix A, as amended from time to time. Awards not specifically illustrated in Appendix A will be pro-rated by analogy to those illustrations.
(iv)
Vested stock options (including those becoming vested pursuant to Paragraph 2(c)(i), (ii), or (iii)) may be exercised until one year after the later of (A) termination of employment or (B) if under the terms of the option, performance after termination of employment will be applied to determine the amount of pro ration, the first business day following the date the applicable performance is certified; but in any case no later than the applicable expiration date.
(v)
Pro-rata vesting is based on the number of full calendar months worked during the vesting period applicable to such Award, counting the month of grant as one full month (i.e., January 15-March 31 is three months).
(vi)
The provisions of this Paragraph 2(c) shall be deemed incorporated into the Award agreement for the applicable Award, except to the extent it would be deemed an amendment violating Section 409A of the Internal Revenue Code of 1986, as amended (“Section 409A”) by accelerating payment or settlement of an Award, in which case the Award shall become vested as described above, but settlement shall not be accelerated, and settlement shall occur as initially provided in the Award agreement. If an Executive Officer ceases to be an Executive Officer (including, in the case of a Participating EC Member, by ceasing to be a member of the EC) prior to termination of employment, the provisions of this Paragraph 2(c) shall be deemed removed from the Award agreement for the applicable Award on the 91st day after the individual ceases to be an Executive Officer, without the need for consent of the grantee, except to the extent such removal would be deemed an amendment violating Section 409A, in which case the provisions of this Paragraph 2(c) shall remain in effect with respect to such Award.
(d)
Health Benefit Stipend:
The health benefit stipend shall consist of the payment in a lump sum of an amount equal to the excess of 18 times one months’ COBRA premiums for continued group medical coverage at the rate in effect on the date of termination of employment (for the Executive Officer and his or her eligible dependents covered by the applicable HP group medical plan immediately prior to termination of employment) over 18 times the monthly amount payable by an active employee in the same plan as of the date of the Executive Officer’s termination of employment and with the same level of coverage.
3.
Severance Benefits in the event of a Change in Control.
In the event of a Qualifying Termination, including a voluntary termination for Good Reason (each as defined below) within 24 months after a Change in Control (as defined below), and subject to his or her execution of a Release of Claims within
2
45 days following such termination of employment, and provided there occurs a Release Effective Date, and subject to the terms of this Plan, an Executive Officer will be eligible for severance benefits consisting of the following:
(a)
Severance Benefits
.
(i) a cash severance payment, (ii) a pro-rata annual bonus payment, (iii) a health benefit stipend (each in the amounts described in Paragraph 2 above, except that the amount of the pro rata annual bonus payment will be calculated based on actual performance through the date of the Qualifying Termination; and (iv) vesting in accordance with sub-paragraph 3(b) of any then-outstanding Award granted after the Change in Control and any Replacement Award as defined in Paragraph 4(b), and settlement thereof in accordance with Paragraph 8.
(b)
Vesting
.
(i)
Any such Award or Replacement Award of Options or stock appreciation rights (“SARs”) not subject to Section 409A, to the extent subject to time-based vesting shall become 100% vested upon the Qualifying Termination and to the extent subject, in whole or in part to performance-based vesting, shall become 100% vested at the target level of performance and in either event shall remain exercisable for 1 year after the Qualifying Termination, but in no event after the stated expiration date of the Award or Replacement Award
.
(ii)
Any such Award or Replacement Award (other than Options or SARs, and whether or not subject to Section 409A) (A) that vests and is settled solely based on the performance of service will become 100% vested upon the Qualifying Termination; and (B) that vests in whole or in part based on performance, shall become 100% vested at the target level of performance.
4.
Effect of a Change in Control on Outstanding Long-Term Incentive Awards.
This Paragraph 4 provides for the treatment of long-term incentive awards that are outstanding on the date on which a Change in Control occurs. Treatment depends, in part, on whether the Award is a “Replaceable 409A Award” (which is an Award (A) that is subject to Section 409A and that was granted either prior to November 1, 2015 or on or after November 1, 2015 but prior to the grantee’s becoming an Executive Officer, or (B) that is subject to 409A and the applicable Change in Control is not described in Section 6(e) (i.e., does not qualify under Section 409A)); a “409A Award” (which is an Award granted on or after November 1, 2015 that is subject to Section 409A and the Change in Control is described in Paragraph 6(e)); or a “Non-409A Award” (which is an Award that is not subject to Section 409A, regardless of when granted). In general, subject to the specific terms of this Paragraph 4, (x) Non-409A Awards will receive accelerated vesting and be settled on the occurrence of a Change in Control unless a Replacement Award is granted, in which case the terms of the Replacement Award will apply; (y) Replaceable 409A Awards will receive accelerated vesting and will be settled at the time and in the form provided under the terms of such Awards in effect prior to the Change in Control unless a Replacement Award is granted, in which case the terms of the Replacement Award will apply; and (z) 409A Awards will receive accelerated vesting and be settled on the occurrence of the Change in Control as described in Section 4(c), and will not be eligible to be replaced by Replacement Awards.
(a)
Immediate Vesting of Long-Term Incentive Awards that Are Not Assumed or Replaced
. Notwithstanding any provision to the contrary under this Plan or any equity plan or LTIP maintained by HP, upon a Change in Control any then-outstanding Award held by an Executive Officer, other than a 409A Award, whether such Award is denominated and/or payable in equity securities of HP or denominated and/or payable in cash, shall be treated in accordance with sub-paragraph 4(a)(i), (ii), or (iii) below, except to the extent that another Award meeting the requirements of Paragraph 4(b) below (a “Replacement Award”) is provided to the Executive Officer to replace such Award (the “Replaced Award”). For avoidance of doubt, Replacement Awards shall not be treated as provided in this paragraph 4(a).
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Where no Replacement Award is granted or is to be granted, the following shall apply to an Award other than a 409A Award outstanding upon a Change in Control:
(i)
Outstanding Options and SARs
.
A.
Not a Corporate Transaction or Corporate Transaction in which HP is the Survivor
. Upon a Change in Control that does not involve a Corporate Transaction or that does involve a Corporate Transaction in which HP is the surviving corporation, an Executive Officer’s then-outstanding Options and SARs that are not vested shall immediately become fully vested (and, to the extent applicable, all performance conditions shall be deemed satisfied as if target performance were achieved) and, if the Executive Officer does not have a Qualifying Termination, shall remain exercisable for the exercise period described in Paragraph 2(c)(iv) above.
B.
Corporate Transaction, HP Not the Survivor
. Upon a Change in Control that involves a Corporate Transaction in which HP is not the surviving corporation, one of the following shall apply, as the Committee shall determine in its discretion, provided, however, that all Executive Officers shall be treated the same with respect to similar Awards:
(I)
an Executive Officer’s then-outstanding Options and SARs shall become fully vested and shall be exercisable for such limited period of time prior to the Corporate Transaction as is deemed fair and equitable by the Committee and shall terminate at the effective time of the Corporate Transaction. For performance-based Awards, all performance conditions shall be deemed satisfied as if target performance were achieved. The Committee shall provide written notice of the limited period of accelerated exercisability of Options and SARs to all affected Executive Officers. The exercise of any Option or SAR whose exercisability is accelerated as provided in this Paragraph 4(a)(i)(B)(I) shall be conditioned upon the consummation of the Corporate Transaction and shall be effective only immediately before such consummation; or
(II)
an Executive Officer’s Options and SARs shall become fully vested (and in the case of Options and SARs subject in whole or in part to performance-based vesting all performance conditions shall be deemed satisfied as if target performance were achieved) and such Options and SARs shall be cancelled in exchange for the payment of an amount of cash (less normal withholding taxes) equal to the excess of (A) the value, as determined by the Committee, of the consideration (including cash) received by the holder of a share of common stock of HP (“Share”) as a result of the Change in Control (or if HP shareholders do not receive any consideration as a result of the Change in Control, the fair market value, as determined by the Committee in its sole discretion, of a Share on the day immediately prior to the Change in Control) over (B) the exercise price of such Option or the grant price of the SAR, multiplied by the number of Shares subject to such Award. No payment shall be made to an Executive Officer for any Option or SAR if the exercise price or grant price for such Option or SAR exceeds the value, as determined by the Committee, of the consideration (including cash) received by the holder of a Share as a result of Change in Control that involves a Corporate Transaction (or if HP shareholders do not receive any consideration as a result of the Change in Control, the fair market value, as determined by the Committee in its sole discretion, of a Share on the day immediately prior to the Change in Control).
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(III)
Notwithstanding the foregoing, for any Options or SARs that are Replaceable 409A Awards, if the foregoing treatment would violate Section 409A, such Options and SARs shall become fully vested (with any applicable performance measure deemed to be satisfied at the target level) and shall be converted, as of the date of the Change in Control, to a right to receive a cash payment on the required date of exercise, which payment shall be made on the required date of exercise under the terms of such Award as in effect prior to the Change in Control, equal to the amount described in Paragraph 4(a)(i)(B)(II) above.
(ii)
Outstanding Awards (other than Options and SARs
)
Subject Solely to Service-Based Vesting
. Upon a Change in Control, an Executive Officer’s then-outstanding Awards (other than Options and SARs) that are not vested and as to which vesting depends solely on the satisfaction of a service obligation by the Executive Officer (“Service-based Awards”) shall become fully vested and shall be settled in cash, Shares or a combination thereof, as determined by the Committee, within thirty (30) days following such Change in Control; provided that in the case of a Replaceable 409A Award, settlement shall be made at the time and in the form provided under the terms of such Award in effect prior to the Change in Control.
(iii)
Outstanding Awards (other than Options and SARs) Subject to Performance-Based Vesting
. Upon a Change in Control, an Executive Officer’s then-outstanding Awards (other than Options and SARs) that are not vested and as to which vesting depends upon the satisfaction of one or more performance conditions (“Performance-based Awards) shall immediately vest and all performance conditions shall be deemed satisfied with respect to the greater of (X) 100% of the Shares earned based on actual performance or (Y) the number of the Shares earned based on assumed target performance pro-rated based on the number of full calendar months the Executive Officer was employed by HP during the performance period applicable to such Award, counting the month of grant as one full month (i.e., January 15-March 31 is three months) and shall be settled in cash, Shares or a combination thereof, as determined by the Committee, within thirty (30) days following such Change in Control; provided that in the case of a Replaceable 409A Award, settlement shall be made at the time and in the form provided under the terms of such Award in effect prior to the Change in Control.
(b)
Definition of Replacement Award
. An Award shall meet the conditions of this Paragraph 4(b) (and hence qualify as a Replacement Award) if: (i) it is of the same type of instrument as the Replaced Award; (ii) it has an intrinsic value at least equal to the value of the Replaced Award; (iii) it relates to publicly traded equity securities of HP or its successor in the Change in Control or another entity that is affiliated with HP or its successor following the Change in Control; (iv) its terms and conditions comply with applicable regulations under Section 409A regarding substitutions and assumptions by reason of a corporate transaction; and (v) its other terms and conditions are not less favorable to the holder of the Award than the terms and conditions of the Replaced Award (including the provisions that would apply in the event of a subsequent Change in Control). Without limiting the generality of the foregoing, the Replacement Award may take the form of a continuation or assumption of the Replaced Award if the requirements of the preceding sentence are satisfied. The determination of whether the conditions of this Paragraph 4(b) are satisfied shall be made by the Committee, as constituted immediately before the Change in Control, in its sole discretion. Notwithstanding the foregoing, the Committee may determine the value of Awards and Replacement Awards that are stock options by reference to either their intrinsic value or their fair value.
(c)
Treatment of 409A Awards.
This Paragraph 4(c) shall apply to 409A Awards (i.e., Awards subject to Section 409A when the applicable Change in Control is defined in Section 6(e)). 409A Awards shall be treated, in the case of Options or SARs, as described in Paragraph 4(a)(i)(B)(I) or (II)(regardless of whether HP is the survivor). In the case of 409A Awards other than Options or
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SARs, such 409A Awards shall become vested (with any applicable performance conditions being deemed satisfied with respect to the greater of (X) 100% of the Shares earned based on actual performance or (Y) the number of the Shares earned based on assumed target performance pro-rated based on the number of full calendar months the Executive Officer was employed by HP during the performance period applicable to such Award, counting the month of grant as one full month (i.e., January 15-March 31 is three months) and shall be settled in cash, Shares or a combination thereof, as determined by the Committee, within thirty (30) days following the Change in Control. Awards subject to this Paragraph 4(c) shall not be eligible to be replaced by Replacement Awards or to be continued or assumed in connection with the Change in Control.
5.
Qualifying Termination and Good Reaso
n.
(a)
An Executive Officer will be deemed to have incurred a Qualifying Termination for purposes of this plan if he or she is involuntarily terminated, as determined by the Committee, other than for Cause while holding Executive Officer status or within 90 days after having held Executive Officer status. For purposes of this Plan, the term “Cause” shall mean an Executive Officer’s:
(i)
Material neglect (other than as a result of illness or disability) of his or her duties or responsibilities to HP; or
(ii)
Conduct (including action or failure to act) that is not in the best interest of, or is injurious to, HP.
An Executive Officer shall not be deemed to have engaged in conduct constituting Cause under this plan except by a majority vote of the members of the Board or an independent committee thereof.
(b)
For purposes of this plan, “Qualifying Termination” shall also include an Executive Officer’s voluntary termination of employment for “Good Reason” provided such termination occurs within 24 months after a Change in Control, where “Good Reason” means:
(i)
a material reduction in the Executive Officer’s position, authority, duties or responsibilities relative to such position, authority, duties or responsibilities immediately prior to the Change in Control; or
(ii)
a material reduction in the Executive Officer’s base salary or target bonus opportunity as in effect immediately prior to the Change in Control; or
(iii)
receipt of notice by the Executive Officer with regard to the mandatory relocation (other than by mutual agreement) of the office at which the Executive Officer is to perform the majority of his or her duties following the Change in Control to a location more than 50 miles from the location at which the Executive Officer performed such duties prior to the Change in Control; or
(iv)
the failure at any time of a successor to HP explicitly to assume and agree to be bound by this Plan.
(c)
Notwithstanding anything in this Plan to the contrary, no act, omission or event shall constitute grounds for a voluntary termination due to “Good Reason” unless:
(i)
the Executive Officer provides HP thirty (30) day advance written notice of his or her intent to termination employment for Good Reason which notice must describe the claimed act, omission or event giving rise to Good Reason (“Notice of Termination”); and
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(ii)
The Notice of Termination is given within ninety (90) days of Executive Officer’s first actual knowledge of such act, omission or event;
(iii)
HP fails to cure such act, omission or event within the thirty (30) day period after receiving the Notice of Termination; and
(iv)
the Executive Officer’s termination of employment for Good Reason actually occurs at the end of such 30-day cure period if the Good Reason is not cured.
6.
Change in Control.
A Change in Control means the first to occur of any of the following:
(a)
A direct or indirect acquisition by an individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act) (a “Person”) of beneficial ownership of shares which, together with other direct or indirect acquisitions or beneficial ownership by such Person, results in aggregate beneficial ownership by such Person of thirty percent (30%) or more of either (1) the then outstanding shares of common stock (the “Outstanding HP Common Stock”) of HP, or (2) the combined voting power of the then outstanding voting securities of HP (the “Outstanding HP Voting Securities”); excluding, however, the following: (i) any acquisition directly from HP, other than an acquisition by virtue of the exercise of a conversion privilege unless the security being so converted was itself acquired directly from HP, (ii) any acquisition by HP or a wholly owned Subsidiary, (iii) any acquisition by any employee benefit plan (or related trust) sponsored or maintained by HP or any entity controlled by HP, or (iv) any acquisition by any entity pursuant to a transaction which complies with Paragraphs 6 (c)(i), (ii) or (iii); or
(b)
A change in the composition of the Board over a 12-month period such that the individuals who, as of the date of the beginning of the period (the “Effective Incumbency Date”), constitute the Board (the “Incumbent Board”) cease for any reason to constitute a majority of the Board; provided, however, that any individual who becomes a member of the Board subsequent to the Effective Incumbency Date, whose election, or nomination for election by HPs stockholders, was approved by a vote of a majority of those individuals then comprising the Incumbent Board shall be considered as though such individual were a member of the Incumbent Board; but, provided further, that any such individual whose initial assumption of office occurs as a result of either an actual or threatened election contest with respect to the election or removal of directors or other actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Board shall not be so considered as a member of the Incumbent Board; or
(c)
The consummation of a Corporate Transaction; excluding, however, such a Corporate Transaction pursuant to which (i) all or substantially all of the individuals and entities who are the beneficial owners, respectively, of the Outstanding HP Common Stock and Outstanding HP Voting Securities immediately prior to such Corporate Transaction will beneficially own, directly or indirectly, more than sixty percent (60%) of, respectively, the outstanding shares of common stock, and the combined voting power of the then outstanding voting securities of the surviving or acquiring entity resulting from such Corporate Transaction or a direct or indirect parent entity of the surviving or acquiring entity (including, without limitation, an entity which as a result of such transaction owns HP or all or substantially all of HP’s assets either directly or through one or more subsidiaries) in substantially the same proportions (as compared to each other) as their ownership, immediately prior to such Corporate Transaction, of the Outstanding HP Common Stock and Outstanding HP Voting Securities, as the case may be, (ii) no Person (other than HP, any wholly owned subsidiary, any employee benefit plan (or related trust)) sponsored or maintained by HP, any entity controlled by HP, such surviving or acquiring entity resulting from such Corporate Transaction or any entity controlled by such surviving or acquiring entity or a direct or indirect parent entity of the surviving or acquiring entity that, after giving effect to the Corporate Transaction, beneficially owns, directly or indirectly, 100% of the outstanding voting securities of the surviving or acquiring entity) will beneficially own, directly or indirectly, twenty percent (30%) or more of, respectively, the outstanding shares of common stock (or comparable equity interests) of the entity resulting from such Corporate Transaction or the combined voting power of
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the outstanding voting securities of such entity except to the extent that such ownership existed prior to the Corporate Transaction or (iii) individuals who were members of the Incumbent Board will constitute a majority of the members of the board of directors (or similar governing body) of the surviving or acquiring entity resulting from such Corporate Transaction or a direct or indirect parent entity of the surviving or acquiring entity. “Corporate Transaction” means (w) a dissolution or liquidation of HP, (x) a sale of all or substantially all of the assets of HP, (y) a merger or consolidation of HP with or into any other corporation, regardless of whether t HP is the surviving corporation, or (z) a statutory share exchange involving capital stock of HP.
(d)
For avoidance of doubt, the separation of Hewlett-Packard Company into HP Inc. and Hewlett Packard Enterprise shall not be a Change in Control under the Plan.
(e)
A Change in Control is described in this Paragraph 6(e) only if it would also constitute a “change in ownership” of HP, a “change in effective control” of HP, or a “change in ownership of a substantial portion of assets” of HP under Section 409A.
7.
Form and Time of Payment for Severance Benefits Outside a Change in Control
. Subject to the timely execution of the required Release of Claims, and the occurrence of the Release Effective Date, severance benefits provided under Paragraph 2 shall be paid in accordance with the following provisions:
(a)
Cash severance benefits under Paragraph 2(a) shall be paid to an Executive Officer in installments as follows: 25% of such cash severance benefits shall be paid no later than the 75
th
day following the date of an Executive Officer’s Qualifying Termination, and then 25% of such cash severance benefit on the 6
th
, 12
th
and 18
th
month anniversary of the date of such Qualifying Termination.
(b)
The pro-rata annual bonus under Paragraph 2(b) shall be paid at the time such bonuses are otherwise paid to participants in the applicable bonus plan; provided that if the Release Effective Date is after the date that the bonus would otherwise have been paid, such payment shall be made as soon as administratively practicable after the Release Effective Date, but in no event later than March 15 of the year following the year in which the bonus performance period ended.
(c)
The health benefit stipend under Paragraph 2(d) shall be paid to an Executive Officer on the same date the Executive Officer is paid the first installment of his or her cash severance under Paragraph (a) above.
(d)
Any Award entitled to pro rata vesting that would have otherwise become vested and been settled solely based on the performance of service will be settled, or in the case of an Award that is an option or SAR, accelerated vesting will occur, no later than the 75
th
day following the date of an Executive Officer’s Qualifying Termination.
(e)
Any Award entitled to pro rata vesting that would otherwise have become vested and been settled, in whole or in part, based on performance for which the applicable performance period has not ended on or prior to the Executive Officer’s Qualifying Termination will be settled (or in the case of an Award of options or SAR, accelerated vesting will occur) at the time such Award is otherwise settled for (or vests) for other holders of such Awards; provided that if the Release Effective Date is after the date that the Award would otherwise have been settled, such settlement or vesting shall occur no later than the 75
th
day following the date of the Release Effective Date.
All payments and benefits under this plan shall be subject to, and made net of, applicable deductions and withholdings. Any payments and benefits under this plan shall be reduced by any severance benefit payable to the Executive Officer under any other HP plan, program or agreement.
All payments and benefits are subject to the Executive Officer’s continuing compliance with HP Agreement Regarding Confidential Information and Proprietary Developments (as reflected in the Release of Claims), and to HP’s policies on recoupment, as in effect from time to time.
8
8.
Form and Time of Payment for Severance Benefits in the event of a Change in Control
. Subject to the timely execution of the required Release of Claims, and the occurrence of the Release Effective Date, severance benefits provided under Paragraph shall be paid in accordance with the following provisions:
(a)
Cash severance benefits the pro-rata annual bonus, and the health benefit stipend under Paragraph 3(a) shall be paid to the Executive Officer in a lump sum no later than the 75
th
day following the Qualifying Termination.
(b)
Any Award, including a Replacement Award (to the extent vested under Paragraph 3) shall be settled, or in the case of an option or SAR, accelerated vesting will occur, no later than the 75
th
day following the date of an Executive Officer’s Qualifying Termination.
All payments and benefits under this plan shall be subject to, and made net of, applicable deductions and withholdings. Any payments and benefits under this plan shall be reduced by any severance benefit payable to the Executive Officer under any other HP plan, program or agreement.
All payments and benefits are subject to the Executive Officer’s continuing compliance with HP Agreement Regarding Confidential Information and Proprietary Developments (as reflected in the Release of Claims), and to HP’s policies on recoupment, as in effect from time to time.
9.
Section 409A Provisions
. The term “termination of employment,” “termination,” “separation from service” and similar terms shall mean a “separation from service” within the meaning of Section 409A.
Any amounts payable solely on account of an “involuntary” separation from service within the meaning of Section 409A shall be, to the maximum extent possible, excludible from the requirements of Section 409A, either as involuntary separation pay or as short-term deferral amounts. For purposes of Section 409A, each payment of compensation under the plan shall be treated as a separate payment of compensation.
Any reimbursements or in-kind benefits provided under the plan shall be made or provided in accordance with the requirements of Section 409A, including, where applicable, the requirement that (a) any reimbursement is for expenses incurred during the period of time specified in the Agreement, (b) the amount of expenses eligible for reimbursement, or in-kind benefits provided, during a calendar year may not affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other calendar year, (c) 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 (d) the right to reimbursement or in-kind benefits is not subject to liquidation or exchange for another benefit.
If payment of any amount of nonqualified deferred compensation is triggered by a separation from service that occurs while the Executive Officer is a specified employee (as such term is defined in Section 409A), and if such amount is scheduled to be paid within six months after such separation from service, the amount shall accrue without interest and shall be paid the first business day after the end of such six-month period, or, if earlier, within 15 days after the appointment of the personal representative or executor of the Executive Officer’s estate following the Executive Officer’s death.
If the maximum period within which the Executive Officer must sign and not revoke the Release of Claims would begin in one calendar year and expire in the following calendar year, then any payments contingent on the occurrence of the Release Effective Date shall be made in such following calendar year (regardless of the year of execution of such release) if payment in such following calendar year is required in order to comply with Section 409A. If the Release Effective Date has not occurred by the 53rd day following termination of employment, the Executive Officer will not be entitled to any amounts or
9
accelerated vesting that are subject to the timely execution of the Release of Claims and the occurrence of the Release Effective Date.
For avoidance of doubt, if an Executive Officer’s Award or Replacement Award is subject to Section 409A, and the vesting or settlement acceleration provisions of the Plan would cause the Award to be subject to additional tax and interest penalties under Section 409A (including but not limited to the Award’s being deemed amended by the terms of the Plan after it was granted), then the Committee shall not settle such Award (or Replacement Award) on an accelerated basis.
Notwithstanding the foregoing, HP does not make any guarantees or other assurances of any kind with respect to the tax consequences or treatment of any amounts paid or payable to him under this plan.
10.
Effect on Other Benefits; At-Will Status
. Payments under this plan shall not be considered compensation for purposes of any other compensation or benefit plan, program, or agreement of HP or its affiliates. All other compensation and benefit plans and programs shall be governed by the applicable HP plan or agreement. This plan does not create an employment relationship for any fixed term.
11.
Effective Date; Administration of Plan
. The Plan was originally effective October 31, 2003, was amended and restated effective for terminations occurring after November 1, 2011, and is further amended and restated as set forth herein, effective for terminations occurring after November 1, 2015. The Plan may be amended or terminated at any time by the Committee or the Board, in their discretion; provided that (a) no right to payments or benefits in pay status may be cut back without the consent of the affected Executive Officer, and (b) no amendment that would have the effect of reducing payments or benefits under Paragraph 3 Severance Benefits in the event of a Change in Control may take effect prior to the second anniversary of a Change in Control.
The Committee shall have full authority, in its discretion to interpret and apply the provisions of the plan, to establish rules and procedures applicable to the Plan, to resolve any ambiguity, correct any defect or supply any omission; to make such adjustments or modifications as the Committee deems appropriate for Executive Officers who are working outside the United States as are advisable to fulfill the purposes of the plan or to comply with applicable local law’ and to take any other action it deems necessary or advisable for administration of the Plan.
This plan is intended to be consistent with the Board’s policy regarding severance agreements for senior executives, as adopted by resolutions dated July 18, 2003 (the “Resolutions”), and the benefits provided for hereunder, exclusive of “permitted benefits” (as defined in the Resolutions), do not exceed 2.99 times the sum of any eligible executive’s base salary plus bonus as in effect immediately prior to separation from employment. The Committee may take such action as is necessary to implement and administer this plan consistent with such intent of the Board.
12.
Clawback
. Any amounts payable under the Plan are subject to any policy providing for clawback, recoupment or recovery of amounts that were paid to an Executive Officer as established from time to time by the Committee and adopted prior to a Change in Control or required by applicable law. The HP shall make any determination for clawback, recoupment or recovery in its sole discretion and in accordance with any such policy and applicable law or regulation.
13.
Best Net.
It is the object of this paragraph to provide for the maximum after-tax income to each Executive Officer with respect to any payment or distribution to or for the benefit of the Executive Officer, whether paid or payable or distributed or distributable pursuant to the Plan or any other plan, arrangement or agreement, that would be subject to the excise tax imposed by Section 4999 of the Internal Revenue Code (“Code”) or any similar federal, state or local tax that may hereafter be imposed (a “Payment”) (Section 4999 of the Code or any similar federal, state or local tax are collectively referred to as the “Excise Tax”). Accordingly, before any Payments are made under this Plan, a determination will be made as to
10
which of two alternatives will maximize such Executive Officer’s after-tax proceeds, and HP must notify the Executive Office in writing of such determination. The first alternative is the payment in full of all Payments potentially subject to the Excise Tax. The second alternative is the payment of only a part of the Executive Officer’s Payments so that the Executive Officer receives the largest payment and benefits possible without causing the Excise Tax to be payable by the Executive Officer. This second alternative is referred to in this paragraph as “Limited Payment”. The Executive Officer’s Payments shall be paid only to the extent permitted under the alternative determined to maximize the Executive Officer’s after-tax proceeds, and the Executive Officer shall have no rights to any greater payments on his or her Payments. If Limited Payment applies, Payments shall be reduced in a manner that would not result in the Executive Officer incurring an additional tax under Section 409A.
(a)
Accordingly, Payments not constituting nonqualified deferred compensation under Section 409A shall be reduced first, in this order but only to the extent that doing so avoids the Excise Tax (e.g., accelerated vesting or payment provisions in an Award will be ignored to the extent that such provisions would trigger the Excise Tax):
(i)
Payment of the severance amounts under Paragraph 3 hereof to the extent such payments do not constitute deferred compensation under Section 409A.
(ii)
Performance-based Awards, but excluding Performance-based Awards subject to Section 409A.
(iii)
Service-based Awards, but excluding Service-based Awards subject to Section 409A.
(iv)
Awards of Options and SARs under a HP LTIP.
(b)
Then, if the foregoing reductions are insufficient, Payments constituting deferred compensation under Section 409A shall be reduced, in this order:
(i)
Payment of the severance amounts under Paragraph 3 hereof to the extent such payments constitute deferred compensation under Section 409A.
(ii)
Performance-based Awards subject to Section 409A.
(iii)
Service-based Awards subject to Section 409A.
In the event of conflict between the order of reduction under this Plan and the order provided by any other HP document governing a Payment, then the order under this Plan shall control.
All determinations required to be made under this Paragraph 13 shall be made by HP’s external auditor (the “Accounting Firm”) which shall provide detailed supporting calculations both to HP and the Executive Officer within ten (10) business days of the termination of employment giving rise to benefits under the Plan, or such earlier time as is requested by HP. All fees, costs and expenses (including, but not limited to, the costs of retaining experts) of the Accounting Firm shall be borne by HP. In the event the Accounting Firm determines that the Payments shall be reduced, it shall furnish the Executive Officer with a written opinion to such effect. The determination by the Accounting Firm shall be binding upon HP and the Executive Officer.
11
APPENDIX A
Vesting Examples for Specific Awards
Performance-Contingent Stock Options (PCSOs) With 2-Part Service Vesting
(Generally granted prior to September 18, 2013)
Assumptions regarding Award design:
The vesting terms of the PCSO are as follows: 50% of the PCSO will vest, if at all, on the later to occur of the second anniversary of the grant date, with continued service, or the satisfaction of a 20% share price increase within four years of the grant date, with continued service.
The remaining 50% of the PCSO will vest, if at all, on the later to occur of the third anniversary of the grant date, with continued service, or the satisfaction of a 40% share price increase within four years of the grant date, with continued service.
Upon termination of the Executive Officer’s employment prior to the PCSOs’ becoming 100% vested, the Executive Officer is entitled to “pro rata vesting” of the PCSO
Award
.
Assume an Executive Officer is granted 12,000 PCSOs.
The rules of proration are as follows:
1.
If, upon termination of the Executive Officer’s employment, neither share price component has been satisfied, none of the Stock Options vest, regardless of what portion of the service component has been satisfied.
2.
Assume both the 20% and 40% price share components are satisfied prior to the Executive Officer’s termination of employment. Assume the Executive Officer has a Qualifying Termination prior to the third anniversary of the grant date. The PCSOs will vest pro rata based on number of full months elapsed from the grant date to the date of termination of employment, divided by the number of months in the service period (in this example 36 months) taking into account the number of PCSOs previously vested, if any, as illustrated below:
Pro-ration of PCSOs With 2-Part Service Vesting
Both 20% and 40% Share Price Components Satisfied
|
Termination of Employment
|
|
Number of Option Shares Vested
|
|
|
|
|
|
6 months after the Grant Date
|
|
2,000 PCSOs become vested: 6/36 x 12,000 = 2,000.
|
|
|
|
|
|
12 months after the Grant Date
|
|
4,000 PCSOs become vested: 12/36 x 12,000 = 4,000
|
|
|
|
|
|
18 months after the Grant Date
|
|
6,000 PCSOs become vested: 18/36 x 12,000 = 6,000
|
12
Pro-ration of PCSOs With 2-Part Service Vesting
Both 20% and 40% Share Price Components Satisfied
|
Termination of Employment
|
|
Number of Option Shares Vested
|
|
|
|
|
|
24 months after the Grant Date
|
|
2,000 additional PCSOs become vested: 24/36 x 12,000 = 8,000 minus the 6,000 that became vested on the second anniversary of the grant date.
|
|
|
|
|
|
30 months after the Grant Date
|
|
4,000 additional PCSOs become vested: 30/36 x 12,000 = 10,000, minus the 6,000 that vested on the second anniversary of the grant date.
|
3.
Assume the 20% share price component is satisfied 15 months after the grant date. The 40% share price component has not been satisfied when the Executive Officer terminates employment. Upon termination of the Executive Officer’s employment, the PCSOs shall vest pro rata based on number of full months elapsed from the grant date to the date of termination of employment (not to exceed 36), divided by the number of months in the service period (in this example 36 months) taking into account the number of PCSOs previously vested, if any, as illustrated below:
Pro-ration of PCSOs With 2-Part Service Vesting
Only the 20% Share Price Component is Satisfied
|
Termination of Employment
|
|
Number of Option Shares Vested
|
|
|
|
|
|
6 months after the Grant Date
|
|
Zero (0) PCSOs become vested under the pro ration rules because neither share price component has been satisfied.
|
|
|
|
|
|
12 months after the Grant Date
|
|
Zero (0) PCSOs become vested under the pro ration rules because neither share price component has been satisfied.
|
|
|
|
|
|
18 months after the Grant Date
|
|
3,000 PCSOs become vested under the proration rules: 18/36 of the 6,000 PCSOs subject to the 20% share price component.
|
|
|
|
|
|
24 months after the Grant Date
|
|
Zero (0) additional PCSOs become vested because the 6,000 PCSOs eligible to vest on satisfaction of the 20% share price component automatically vested on the second anniversary of the grant date.
|
|
|
|
|
|
30 months after the Grant Date
|
|
Zero (0) additional PCSOs become vested: All of the 6,000 PCSOs eligible to vest became vested on the second anniversary of the grant date.
|
13
Performance-Contingent Stock Options (PCSOs) With 3-Part Service Vesting
(Generally granted on or after September 18, 2013)
Assumptions regarding Award design:
The vesting terms of the PCSO are as follows:
One-third of the PCSO will vest, if at all, on the later to occur of the first anniversary of the grant date, with continued service, or the satisfaction of a 20% share price increase within four years of the grant date, with continued service.
One-third of the PCSO will vest, if at all, on the later to occur of the second anniversary of the grant date, with continued service, or the satisfaction of a 20% share price increase within four years of the grant date, with continued service.
The remaining one-third of the PCSO will vest, if at all, on the later to occur of the third anniversary of the grant date, with continued service, or the satisfaction of a 40% share price increase within four years of the grant date, with continued service.
Upon termination of the Executive Officer’s employment prior to the PCSOs’ becoming 100% vested, the Executive Officer is entitled to “pro rata vesting” of the PCSO
Award
.
Assume the Executive Officer is granted 12,000 PCSOs.
The rules of proration are as follows:
1.
If, upon termination of the Executive Officer’s employment, neither share price component has been satisfied, none of the Stock Options vest, regardless of what portion of the service component has been satisfied.
2.
Assume both the 20% and 40% price share components are satisfied prior to the Executive Officer’s termination of employment. Assume the Executive Officer has a Qualifying Termination prior to the third anniversary of the grant date. The PCSOs will vest pro rata based on number of full months elapsed from the grant date to the date of termination of employment, divided by the number of months in the service period (in this example 36 months) taking into account the number of PCSOs previously vested, if any, as illustrated below:
Pro-ration of PCSOs With 3-Part Service Vesting
Both 20% and 40% Share Price Components Satisfied
|
Termination of Employment
|
|
Number of Option Shares Vested
|
|
|
|
|
|
6 months after the Grant Date
|
|
2,000 PCSOs become vested: 6/36 x 12,000 = 2,000.
|
|
|
|
|
|
12 months after the Grant Date
|
|
Zero (0) additional PCSOs become vested under the pro ration rules because the 4,000 PCSOs eligible to vest after 1 year if the 20% share price component was satisfied automatically became vested on the first anniversary of
|
14
Pro-ration of PCSOs With 3-Part Service Vesting
Both 20% and 40% Share Price Components Satisfied
|
Termination of Employment
|
|
Number of Option Shares Vested
|
|
|
|
|
|
|
|
the Grant Date.
|
|
|
|
|
|
15 months after the Grant Date
|
|
1,000 additional PCSOs become vested: 15/36 x 12,000 = 5,000 minus the 4,000 that vested on the first anniversary of the Grant Date.
|
|
|
|
|
|
18 months after the Grant Date
|
|
2,000 additional PCSOs become vested: 18/36 x 12,000 = 6,000 minus the 4,000 that vested on the first anniversary of the grant date
|
|
|
|
|
|
24 months after the Grant Date
|
|
Zero (0) additional PCSOs become vested because 24/36 x 12,000 = 8,000 minus the 8,000 that vested on the first and second anniversaries grant date (4,000 each anniversary).
|
|
|
|
|
|
30 months after the Grant Date
|
|
2,000 additional PCSOs become vested: 30/36 x 12,000 = 10,000 minus the 8,000 that vested on the first and second anniversaries of the grant date.
|
3.
Assume the 20% share price component is satisfied 15 months after the grant date. The 40% share price component has not been satisfied when the Executive Officer terminates employment. Upon termination of the Executive Officer’s employment, the PCSOs shall vest pro rata based on number of full months elapsed from the grant date to the date of termination of employment (not to exceed 36), divided by the number of months in the service period (in this example 36 months) taking into account the number of PCSOs previously vested, if any, as illustrated below:
Pro-ration of PCSOs With 3-Part Service Vesting
Only the 20% Share Price Component is Satisfied
|
Termination of Employment
|
|
Number of Option Shares Vested
|
|
|
|
|
|
6 months after the Grant Date
|
|
Zero (0) PCSOs become vested: Neither share price component has been satisfied.
|
|
|
|
|
|
12 months after the Grant Date
|
|
Zero (0) PCSOs become vested: Neither share price component has been satisfied.
|
|
|
|
|
|
15 months after the Grant Date
|
|
1,000 additional PCSOs become vested: 15/36 x 12,000 = 5,000 minus the 4,000 that vested upon the 20% share price component being met.
|
15
Pro-ration of PCSOs With 3-Part Service Vesting
Only the 20% Share Price Component is Satisfied
|
18 months after the Grant Date
|
|
2,000 additional PCSOs become vested: 18/36 x 12,000 = 6,000 minus the 4,000 already vested.
|
|
|
|
|
|
24 months after the Grant Date
|
|
Zero (0) additional PCSOs become vested: All of the 8,000 PCSOs eligible to vest on satisfaction of the 20% share price component became vested on the second anniversary of the grant date.
|
|
|
|
|
|
30 months after the Grant Date
|
|
Zero (0) additional PCSOs become vested: All of the 8,000 PCSOs eligible to vest became vested on the second anniversary of the grant date.
|
Performance-Contingent Stock Options (PCSOs) With 3-Part Service Vesting and 7-year TSR-Contingent Vesting
(Generally granted on or after December 11, 2013)
Assumptions regarding Award design:
The vesting terms of the PCSO are as follows:
One-third of the PCSO will vest on the later to occur of the first anniversary of the grant date, with continued service, or the satisfaction of a 10% share price increase within two years after the grant date, with continued service. (“10% Tranche”)
One-third of the PCSO will vest on the later to occur of the second anniversary of the grant date, with continued service, or the satisfaction of a 20% share price increase within three years after the grant date, with continued service. (“20% Tranche”)
The remaining one-third of the PCSO will vest on the later to occur of the third anniversary of the grant date, with continued service, or the satisfaction of a 30% share price increase within four years of the grant date, with continued service. (“30% Tranche”)
Regardless of whether any of the share-price increases are timely satisfied, the PCSO will vest in full on the 7th anniversary of the grant date, with continued service, if HP’s 7-year TSR, measured from the first day of the year in which the grant was made to the 7th anniversary of such first day, meets or exceeds the 55th percentile of the S&P 500 TSR over the same period.
Upon a Qualifying Termination of the Executive Officer’s employment prior to the PCSOs becoming 100% vested, the Executive Officer is entitled to “pro rata vesting” of the PCSO
Award
. The PCSO will be forfeited to the extent the share price performance has not been met. There will be no pro ration based solely on a 7-year service period. The proration, if any, will be in the proportion the number of months of service in the service period (not to exceed 36) bears to 36 months.
16
EXAMPLES:
Assume the Executive Officer is granted 12,000 PCSOs.
The rules of proration are as follows:
1.
No price components satisfied.
If, upon termination of the Executive Officer’s employment, none of the share price components has been satisfied, none of the PCSOs vest, regardless of what portion of the performance period has been served.
2.
All price components satisfied.
Assume each of the 10%, 20% and 30% price components have been satisfied prior to the Executive Officer’s Qualifying Termination. Assume the Executive Officer has a Qualifying Termination prior to the fourth anniversary of the grant date. The PCSOs will vest pro rata based on the number of full months elapsed from the grant date to the date of the Qualifying Termination (not to exceed 36), divided by 36 months, taking into account the number of PCSOs previously vested, if any, as illustrated below:
TABLE 1
Pro-ration of PCSOs With 3-Part Service Vesting and 7-Year TSR-Contingent Vesting
Each of 10%, 20%, and 30% Share Price Components Satisfied
|
Termination of Employment
|
|
Number of Option Shares Vested
|
|
|
|
|
|
6 months after the Grant Date
|
|
2,000 PCSOs become vested: 6/36 x 12,000 shares = 2,000.
|
|
|
|
|
|
12 months after the Grant Date
|
|
Zero (0) additional PCSOs become vested under the proration rules. 4,000 PCSOs automatically become vested on the first anniversary of the grant date because the 10% Tranche service and share price components were met.
|
|
|
|
|
|
18 months after the Grant Date
|
|
2,000 additional PCSOs become vested: 18/36 x 12,000 shares = 6,000 minus the 4,000 that vested on the first anniversary of the grant date.
|
|
|
|
|
|
21 months after the Grant Date
|
|
3,000 additional PCSOs become vested: 21/36 x 12,000 = 7,000, minus the 4,000 that vested on the first anniversary of the grant date.
|
|
|
|
|
|
24 months after the Grant Date
|
|
Zero (0) additional PCSOs become vested under the proration rules. 4,000 PCSOs automatically become vested on the second anniversary of the grant date because the 20% service and share price components were met. (4,000 shares already vested on the first anniversary of the grant date.)
|
17
TABLE 1
Pro-ration of PCSOs With 3-Part Service Vesting and 7-Year TSR-Contingent Vesting
Each of 10%, 20%, and 30% Share Price Components Satisfied
|
Termination of Employment
|
|
Number of Option Shares Vested
|
|
|
|
|
|
30 months after the Grant Date
|
|
2,000 additional PCSOs become vested: 30/36 x 12,000 = 10,000 minus the 8,000 that vested on the first and second anniversaries of the grant date. (4,000 on each anniversary.)
|
3.
Some but not all share price components satisfied.
Assume the 10% share price component is satisfied 12 months after the grant date and the 20% share price component is satisfied 20 months after the grant date. The 30% share price component has not been satisfied when the Executive Officer’s Qualifying Termination occurs. Upon the Qualifying Termination, the PCSOs shall vest pro rata (not more than 100%) based on number of full months elapsed from the grant date to the date of the Qualifying Termination (not to exceed 36), divided by 36 months, taking into account the number of PCSOs previously vested, if any, as illustrated below:
TABLE 2
Pro-ration of PCSOs With 3-Part Service Vesting and 7-Year Contingent TSR Vesting
Only the 10% and 20% Share Price Components are Satisfied
|
Termination of Employment
|
|
Number of Option Shares Vested
|
|
|
|
|
|
6 months after the Grant Date
|
|
Zero (0) PCSOs become vested: No share price component has been satisfied.
|
|
|
|
|
|
12 months after the Grant Date
|
|
Zero (0) additional PCSOs become vested under the proration rules. 4,000 PCSOs automatically become vested on the first anniversary of the grant date because the 10% Tranche service and share price components were met.
|
|
|
|
|
|
18 months after the Grant Date
|
|
Zero (0) additional PCSOs become vested because the 20% Tranche share price component has not been met. (4,000 PCSOs became vested on the first anniversary of the grant date.)
|
|
|
|
|
|
21 months after the Grant Date
|
|
3,000 additional PCSOs become vested: 21/36 x 12,000 = 7,000 minus the 4,000 that vested on the first anniversary of the grant date.
|
18
TABLE 2
Pro-ration of PCSOs With 3-Part Service Vesting and 7-Year Contingent TSR Vesting
Only the 10% and 20% Share Price Components are Satisfied
|
24 months after the Grant Date
|
|
Zero (0) additional PCSOs become vested under the proration rules. 4,000 PCSOs automatically become vested on the second anniversary of the grant date because the 20% service and share price components were met. (4,000 shares already vested on the first anniversary of the grant date.)
|
|
|
|
|
|
30 months after the Grant Date
|
|
No additional PCSOs become vested because the 30% Tranche share price component has not been met.
|
Performance-Adjusted RSUs (PARSUs) With 3-Part Service Vesting
(Generally granted on or after December 11, 2013)
Assumptions regarding Award design:
The vesting terms of the PARSU
Award
are as follows:
A portion of Segment 1 of the PARSUs will vest when performance for that segment is certified at the end of the 2-year period, with continued service. The portion becoming vested will depend on performance against 2-year ROIC and 2-year TSR targets, and will range from 0% to 200% of the target number of Segment 1 PARSUs.
A portion of Segment 2 of the PARSUs will vest when performance for that segment is certified at the end of the 3-year period, with continued service. The portion becoming vested will depend on performance against 3-year ROIC and 3-year TSR targets, and will range from 0% to 200% of the target number of Segment 2 PARSUs.
Upon the Executive Officer’s Qualifying Termination prior to the PARSUs becoming 100% vested, the Executive Officer is entitled to “pro rata vesting” of the PARSU
Award
. In this case, the service period and the performance period for each Segment are the same, as illustrated below:
|
Applicable Segment
|
|
Performance Period
|
|
Service Period
|
|
Segment 1
|
|
2 years
|
|
2 years
|
|
Segment 2
|
|
3 years
|
|
3 years
|
19
The rules of proration are as follows:
1.
For each Segment, if the Executive Officer’s termination of employment occurs prior to the end of the applicable performance period, the PARSU will vest pro rata at the end of the relevant segment, based on the number of full months elapsed from the beginning of the relevant segment to the date of the Qualifying Termination, divided by the number of months in the relevant segment.
These rules can be illustrated as follows:
Pro-ration of PARSUs With 2-Segment Performance/Service Periods
Performance-Adjusted RSUs
|
Termination of Employment
|
|
Number of PARSUs Vested
|
|
|
|
|
|
6 months after the beginning of the performance period
|
|
Segment 1: 25% of the PARSUs that would have been earned become vested (6/24) at the end of the 2-year performance period.
Segment 2: 16.66% of the PARSUs that would have been earned become vested (6/36) at the end of the 3-year performance period.
|
|
|
|
|
|
12 months after the beginning of the performance period
|
|
Segment 1: 50% of the PARSUs that would have been earned become vested (12/24) at the end of the 2-year performance period.
Segment 2: 33.33% of the PARSUs that would have been earned become vested (12/36) at the end of the 3-year performance period.
|
|
|
|
|
|
24 months after the beginning of the performance period
|
|
Segment 1: Zero (0) additional PARSUs become vested because the Segment 1 PARSUs earned became vested automatically at the end of the 2-year performance period.
Segment 2: 66.67% of the PARSUs that would have been earned become vested (24/36) at the end of the 3-year performance period.
|
|
|
|
|
|
30 months after the beginning of the performance period
|
|
Segment 1: Zero (0) additional PARSUs become vested because the Segment 1 PARSUs earned became vested automatically at the end of the 2-year performance period.
Segment 2: 83.33% of the PARSUs that would have been earned become vested (30/36) at the end of the 3-year performance period.
|
20
Performance-Contingent Stock Options (PCSOs) With 3-Part Service Vesting
(Generally granted on or after December 10, 2014)
Assumptions regarding Award design:
The vesting terms of the PCSO are as follows:
One-third of the PCSO will vest on the later to occur of the first anniversary of the grant date, with continued service, or the satisfaction of a 10% share price increase within two years after the grant date, with continued service. (“10% Tranche”)
One-third of the PCSO will vest on the later to occur of the second anniversary of the grant date, with continued service, or the satisfaction of a 20% share price increase within three years after the grant date, with continued service. (“20% Tranche”)
The remaining one-third of the PCSO will vest on the later to occur of the third anniversary of the grant date, with continued service, or the satisfaction of a 30% share price increase within four years of the grant date, with continued service. (“30% Tranche”)
Upon a Qualifying Termination of the Executive Officer’s employment prior to the PCSOs becoming 100% vested, the Executive Officer is entitled to “pro rata vesting” of the PCSO
Award
; provided the applicable share-price component has been satisfied prior to the Qualifying Termination. The PCSO will be forfeited to the extent the share price performance has not been met. The proration, if any, will be in the proportion the number of months of service in the service period (not to exceed 36) bears to 36 months.
EXAMPLES:
Assume the Executive Officer is granted 12,000 PCSOs.
The rules of proration are as follows:
1.
No price components satisfied.
If, upon termination of the Executive Officer’s employment, none of the share price components has been satisfied, none of the PCSOs vest, regardless of what portion of the performance period has been served.
2.
All price components satisfied.
Assume each of the 10%, 20% and 30% price components have been satisfied prior to the Executive Officer’s Qualifying Termination. Assume the Executive Officer has a Qualifying Termination prior to the fourth anniversary of the grant date. The PCSOs will vest pro rata based on the number of full months elapsed from the grant date (not to exceed 36) to the date of the Qualifying Termination, divided by 36 months, taking into account the number of PCSOs previously vested, if any, as illustrated below:
TABLE 1
Pro-ration of PCSOs With 3-Part Service Vesting
Each of 10%, 20%, and 30% Share Price Components Satisfied
|
Termination of Employment
|
|
Number of Option Shares Vested
|
|
|
|
|
|
6 months after the Grant Date
|
|
2,000 PCSOs become vested: 6/36 x 12,000 shares =
|
21
TABLE 1
Pro-ration of PCSOs With 3-Part Service Vesting
Each of 10%, 20%, and 30% Share Price Components Satisfied
|
Termination of Employment
|
|
Number of Option Shares Vested
|
|
|
|
|
|
|
|
2,000.
|
|
|
|
|
|
12 months after the Grant Date
|
|
Zero (0) additional PCSOs become vested under the proration rules. 4,000 PCSOs automatically became vested on the first anniversary of the grant date because the 10% Tranche service and share price components were met.
|
|
|
|
|
|
18 months after the Grant Date
|
|
2,000 additional PCSOs become vested: 18/36 x 12,000 shares = 6,000 minus the 4,000 that vested on the first anniversary of the grant date.
|
|
|
|
|
|
21 months after the Grant Date
|
|
3,000 additional PCSOs become vested: 21/36 x 12,000 = 7,000 minus the 4,000 that vested on the first anniversary of the grant date.
|
|
|
|
|
|
24 months after the Grant Date
|
|
Zero (0) additional PCSOs become vested under the proration rules. 4,000 PCSOs automatically became vested on the second anniversary of the grant date because the 20% Tranche service and share price components were met. (4,000 shares already vested on the first anniversary of the grant date.)
|
|
|
|
|
|
30 months after the Grant Date
|
|
2,000 additional PCSOs become vested: 30/36 x 12,000 = 10,000 minus the 8,000 that vested on the first and second anniversaries of the grant date. (4,000 on each anniversary.)
|
3.
Some but not all share price components satisfied.
Assume the 10% share price component is satisfied 12 months after the grant date and the 20% share price component is satisfied 20 months after the grant date. The 30% share price component has not been satisfied when the Executive Officer’s Qualifying Termination occurs. Upon the Qualifying Termination, the PCSOs shall vest pro rata (not more than 100%) based on number of full months elapsed from the grant date to the date of the Qualifying Termination (not to exceed 36), divided by 36 months, taking into account the number of PCSOs previously vested, if any, as illustrated below:
22
TABLE 2
Pro-ration of PCSOs With 3-Part Service Vesting
Only the 10% and 20% Share Price Components are Satisfied
|
Termination of Employment
|
|
Number of Option Shares Vested
|
|
|
|
|
|
6 months after the Grant Date
|
|
Zero (0) PCSOs become vested: No share price component has been satisfied.
|
|
|
|
|
|
12 months after the Grant Date
|
|
Zero (0) additional PCSOs become vested under the proration rules. 4,000 PCSOs automatically became vested on the first anniversary of the grant date because the 10% Tranche service and share price components were met.
|
|
|
|
|
|
18 months after the Grant Date
|
|
Zero (0) additional PCSOs become vested because the 20% Tranche share price component has not been met. (4,000 PCSOs became vested on the first anniversary of the grant date.)
|
|
|
|
|
|
21 months after the Grant Date
|
|
3,000 additional PCSOs become vested: 21/36 x 12,000 = 7,000 minus the 4,000 already vested on the first anniversary of the grant date.
|
|
|
|
|
|
24 months after the Grant Date
|
|
Zero (0) additional PCSOs become vested under the proration rules. 4,000 PCSOs automatically became vested on the second anniversary of the grant date because the 20% Tranche service and share price components were met. (An additional 4,000 PCSOs became vested on the first anniversary of the grant date.)
|
|
|
|
|
|
30 months after the Grant Date
|
|
Zero (0) additional PCSOs become vested because the 30% Tranche share price component has not been met.
|
23
Exhibit 10(p)(p)
GRANT AGREEMENT
|
Grant Date:
|
|
|
|
Grant Number:
|
|
|
|
Grant Price:
|
|
|
|
Award Amount:
|
|
|
|
|
|
Plan:
|
|
|
Performance-Contingent Non-Qualified Stock Option
THIS GRANT AGREEMENT, as of the Grant Date noted above between HP Inc., a Delaware corporation (“Company”), and the employee named above (“Employee”), is entered into as follows:
WHEREAS, the continued participation of the Employee is considered by the Company to be important for the Company’s continued growth; and
WHEREAS, in order to give the Employee an incentive to continue in the employ of the Company (or its Affiliates or Subsidiaries), to accept ancillary agreements designed to protect the legitimate business interests of the Company that are made a condition of this grant and to participate in the affairs of the Company, the HR and Compensation Committee of the Board of Directors of the Company or its delegates (“Committee”) has determined that the Employee shall be granted a non-qualified stock option (“Stock Option”) to purchase the number of shares stated above of its $0.01 par value voting Common Stock (“Shares”) upon the terms and conditions set forth herein and in accordance with the terms and conditions of the Plan named above, a copy of which can be found on the Long-term Incentives website along with a copy of the related prospectus. The Plan and the related prospectus can also be obtained by written or telephonic request to the Company Secretary. Unless otherwise defined in this Grant Agreement, any capitalized terms in this Grant Agreement shall have the meaning ascribed to such terms in the Plan.
THEREFORE, the parties agree as follows:
1.
Grant of Stock Options.
This Stock Option is granted under and pursuant to the Plan and is subject to each and all of the provisions thereof.
2.
Grant Price.
The Grant Price is the price per Share set forth above.
3.
Restrictions on Transfer.
This Stock Option is not transferable by the Employee otherwise than by will or the laws of descent and distribution, and is exercisable only by the Employee during his or her lifetime. This Stock Option may not be transferred, assigned, pledged or hypothecated by the Employee during his or her lifetime, whether by operation of law or otherwise, and is not subject to execution, attachment or similar process.
4.
Vesting Schedule.
This Stock Option will vest and become exercisable according to the vesting schedule set forth below except as otherwise provided in this Grant Agreement and except to the extent a severance plan applicable to the Employee provides otherwise, subject to the Employee’s compliance with the terms and conditions of the Plan and this Grant Agreement.
(a)
This Stock Option shall vest, if at all, as to one-third of the Shares thereunder (“First Tranche”) upon the satisfaction of both of the following criteria prior to the expiration of the Stock Option: (i) the Employee’s continued employment on the first anniversary of the Grant Date (“First Tranche Service Component”), and (ii) subject to the Employee’s continued employment on such date, the first date that the closing Share price on the New York Stock Exchange has met or exceeded 110% of the Grant Price set forth above for at least 20 consecutive trading days within two years after the Grant Date (“First Tranche Share Price Component”); and
(b)
This Stock Option shall vest, if at all, as to one-third of the Shares thereunder (“Second Tranche”) upon the satisfaction of both of the following criteria prior to the expiration of the Stock Option: (i) the Employee’s continued employment on the second anniversary of the Grant Date (“Second Tranche Service Component”), and (ii) subject to the Employee’s continued employment on such date, the first date that the closing Share price on the New York Stock Exchange has met or exceeded 120% of the Grant Price set forth above for at least 20 consecutive trading days within four years after the Grant Date (“Second Tranche Share Price Component”); and
(c)
This Stock Option shall vest, if at all, as to one-third of the Shares thereunder (“Third Tranche”) upon the satisfaction of both of the following criteria prior to the expiration of the Stock Option: (i) the Employee’s continued employment on the third anniversary of the Grant Date (“Third Tranche Service Component”), and (ii) the first date that the closing Share price on the New York Stock Exchange has met or exceeded 130% of the Grant Price set forth above for at least 20 consecutive trading days within five years after the Grant Date, subject to the Employee’s continued employment on such date (“Third Tranche Share Price Component”);
If none of the specified performance measures set forth above are met by the date specified in (a), (b), or (c) as applicable, the Stock Option will not vest and will not be exercisable at any time.
5.
Expiration Date.
This Stock Option will expire on the eighth anniversary of the Grant Date set forth above (“Expiration Date”), unless sooner terminated or canceled in accordance with the provisions of the Plan and this Grant Agreement. The Employee must exercise this Stock Option, if at all, on a day the New York Stock Exchange is open for trading and on or before the Expiration Date. The Employee shall be solely responsible for exercising this Stock Option, if at all, prior to the Expiration Date. The Company shall have no obligation to notify the Employee of this Stock Option’s expiration.
6.
Method of Exercise.
This Stock Option, to the extent it is then vested and exercisable, may be exercised through a broker designated by the Company or by any other method the Committee has approved; provided, however, that no such exercise shall be with respect to fewer than 25 Shares or the remaining Shares covered by the Stock Option if less than 25. The exercise must be accompanied by the payment of the full Grant Price of such Shares and any Tax-Related Items (as defined in Section 11(a)) withholding. Payment may be in cash or Shares or a combination thereof to the extent permissible under Applicable Law or through a broker-assisted cashless exercise; provided, however, that any payment in Shares shall be in strict compliance with all procedural rules established by the Committee.
7.
Termination of Employment.
Upon termination of the Employee’s employment for any reason other than death, permanent and total disability or Cause (as defined below), then all unvested Shares shall be forfeited by the Employee as of the date of termination and he or she may exercise the Stock Option, to the extent that it is then vested, within three (3) months after the date of the Employee’s termination (but in no event later than the Expiration Date), except to the extent a severance plan applicable to the Employee provides otherwise.
8.
Death of Employee.
Notwithstanding the provisions of Section 4 of this Grant Agreement but subject to the terms of Section 17(a)in the event of the Employee’s death prior to the fifth anniversary of the Grant Date, this Stock Option shall vest in full, to the extent not previously vested or forfeited. In the event of the Employee’s death at any time prior to the Expiration Date, the Employee’s legal representative or designated beneficiary shall have the right to exercise all or a portion of the Employee’s vested rights under this Grant Agreement within one (1) year after the death of the Employee, and shall be bound by the provisions of the Plan. In all cases, however, this Stock Option will expire no later than the Expiration Date.
9.
Disability of the Employee.
Notwithstanding the provisions in Section 4 of this Grant Agreement but subject to the terms of Section 17(a) in the event of the Employee’s termination prior to the fifth anniversary of the Grant Date due to permanent and total disability, this Stock Option shall vest in full, to the extent not previously vested or forfeited. In the event of the Employee’s termination due to permanent and total disability at any time prior to the Expiration Date, the Employee may exercise his or her vested rights under this Grant Agreement within three (3) years from the date of termination. In all cases, however, this Stock Option will expire no later than the Expiration Date. The Company’s obligation to vest the Stock Option under this Section is subject to the condition that the Employee shall have executed a current Agreement Regarding Confidential Information and Proprietary Developments (“ARCIPD”) that is satisfactory to the Company, and shall not engage in any conduct that creates a conflict of interest in the opinion of the Company.
2
10.
Termination for Cause.
Upon termination of the Employee’s employment for Cause, then all unvested Shares shall be forfeited by the Employee and he or she may exercise the Stock Option, to the extent that it is then vested, before the New York Stock Exchange closes on the date of the Employee’s termination, except to the extent a severance plan applicable to the Employee provides otherwise. “Cause” shall mean the Employee’s material neglect (other than as a result of illness or disability) of his or her duties or responsibilities to the Company or conduct (including action or failure to act) that is not in the best interest of, or is injurious to, the Company, each as determined in the sole discretion of the Executive Vice President of Human Resources or his or her delegate.
11.
Taxes.
(a)
The Employee shall be liable for any and all taxes, including income tax, social insurance, payroll tax, payment on account, employer taxes, or other tax-related items related to the Employee’s participation in the Plan and legally applicable or otherwise recoverable from the Employee (such as fringe benefit tax) by the Company and/or the Employee’s employer (the “Employer”) whether incurred at grant, vesting, exercise, sale, prior to vesting or at any other time (“Tax-Related Items”). In the event that the Company or the Employer is required, allowed or permitted to withhold taxes as a result of the grant, vesting or exercise of Stock Options, or subsequent sale of Shares acquired pursuant to such Stock Options, the Employee shall make a cash payment or make adequate arrangements satisfactory to the Company and/or the Employer to withhold such taxes from Employee’s wages or other cash compensation paid to the Employee by the Company and/or the Employer at the election of the Company, in its sole discretion, or, if permissible under Applicable Law, the Company may sell or arrange for the sale of Shares that Employee acquires as necessary to cover all applicable required withholding Tax-Related Items that are legally recoverable from the Employee at the time of the tax withholding event, unless the Company, in its sole discretion, has established alternative procedures for such payment. The Employee will receive a cash refund for any fraction of a surrendered Share or Shares in excess of any required Tax-Related Items. To the extent that any payment of cash or alternative procedure for such payment is insufficient, the Employee authorizes the Company, its Affiliates and Subsidiaries, which are qualified to deduct tax at source, to deduct from the Employee’s compensation all Tax-Related Items. The Employee agrees to pay any Tax-Related Items that cannot be satisfied from wages or other cash compensation, to the extent permitted by Applicable Law.
(b)
To avoid negative accounting treatment, the Company and/or the Employer may withhold or account for Tax-Related Items by considering applicable minimum statutory withholding amounts or other applicable withholding rates.
(c)
Regardless of any action the Company or the Employer takes with respect to any or all Tax-Related Items, the Employee acknowledges and agrees that the ultimate liability for all Tax-Related Items is and remains the Employee’s responsibility and may exceed the amount actually withheld by the Company or the Employer. The Employee further acknowledges that the Company and/or the Employer (i) make no representations nor undertakings regarding the treatment of any Tax-Related Items in connection with any aspect of this grant of Stock Options, including, but not limited to, the grant, vesting, exercise or settlement of Stock Options, the subsequent issuance of Shares and/or cash upon settlement of such Stock Options or the subsequent sale of any Shares acquired pursuant to such Stock Options and receipt of any dividends; and (ii) do not commit to and are under no obligation to structure the terms or any aspect of this grant of Stock Options to reduce or eliminate the Employee’s liability for Tax-Related Items or to achieve any particular tax result. Further, if the Employee has become subject to tax in more than one jurisdiction the Employee acknowledges that the Company and/or the Employer (or former employer, as applicable) may be required to withhold or account for Tax-Related Items in more than one jurisdiction. The Employee shall pay the Company or the Employer any amount of Tax-Related Items that the Company or the Employer may be required to withhold or account for as a result of the Employee’s participation in the Plan or the Employee’s receipt, vesting or exercise of Stock Options, that cannot be satisfied by the means previously described. The Company may refuse to deliver the benefit described herein if the Employee fails to comply with the Employee’s obligations in connection with the Tax-Related Items.
(d)
In accepting the Stock Option, the Employee consents and agrees that in the event the Stock Option becomes subject to an Employer tax that is legally permitted to be recovered from the Employee, as may be determined by the Company and/or the Employer at their sole discretion, and whether or not the Employee’s employment with the Company and/or the Employer is continuing at the time such tax becomes recoverable, the Employee will assume any liability for any such taxes that may be payable by the Company and/or the Employer in connection with the Stock Option. Further, by accepting the Stock Option, the Employee agrees that the Company and/or the Employer may collect any such taxes from the Employee by any of the means set forth in this Section 11. The Employee further agrees to execute any other consents or elections required to accomplish the above promptly upon request of the Company.
12.
Acknowledgement and Waiver.
By accepting this Stock Option, the Employee acknowledges, understands and agrees that:
(a)
the Plan is established voluntarily by the Company, it is discretionary in nature and may be modified, amended, suspended or terminated by the Company at any time;
3
(b)
the grant of Stock Options is voluntary and occasional and does not create any contractual or other right to receive future grants of Stock Options, or benefits in lieu of Stock Options, even if Stock Options have been granted repeatedly in the past;
(c)
all decisions with respect to future grants, if any, will be at the sole discretion of the Company;
(d)
the Employee’s participation in the Plan shall not create a right to further employment with the Employer and shall not interfere with the ability of the Employer to terminate the Employee’s employment relationship at any time and it is expressly agreed and understood that employment is terminable at the will of either party, insofar as permitted by Applicable Law;
(e)
the Employee is participating voluntarily in the Plan;
(f)
Stock Options and their resulting benefits are not intended to replace any pension rights or compensation;
(g)
Stock Options and their resulting benefits are not part of normal or expected compensation or salary for any purposes, including, but not limited to calculating any severance, resignation, termination, redundancy, dismissal, end of service payments, bonuses, long-service awards, pension or retirement or welfare benefits or similar payments insofar as permitted by Applicable Law and in no event should be considered as compensation for, or relating in any way to, past services for the Company, the Employer or any Subsidiary or Affiliate;
(h)
unless otherwise agreed with the Company, the Stock Options and the Shares subject to the Stock Options, and the income and value of same, are not granted as consideration for, or in connection with, the service the Employee may provide as a director of a Subsidiary or Affiliate;
(i)
this grant of Stock Options will not be interpreted to form an employment contract or relationship with the Company, and furthermore, this Stock Option will not be interpreted to form an employment contract with the Employer or any Subsidiary or Affiliate;
(j)
the future value of the underlying Shares is unknown, indeterminable and cannot be predicted with certainty;
(k)
no claim or entitlement to compensation or damages shall arise from forfeiture of the Stock Options resulting from termination of Employee’s employment by the Company or the Employer (for any reason whatsoever and whether or not in breach of local labor laws), and in consideration of the grant of the Stock Options to which the Employee is otherwise not entitled, the Employee irrevocably agrees never to institute any claim against the Company or the Employer and releases the Company and the Employer from any such claim; if, notwithstanding the foregoing, any such claim is allowed by a court of competent jurisdiction, then, by participating in the Plan, the Employee shall be deemed irrevocably to have agreed not to pursue such claim and to have agreed to execute any and all documents necessary to request dismissal or withdrawal of such claims;
(l)
notwithstanding any terms or conditions of the Plan to the contrary, in the event of termination of the Employee’s employment (whether or not in breach of local labor laws), the Employee’s right to exercise or otherwise receive benefits under this Grant Agreement after termination of employment, if any, will be measured by the date of termination of Employee’s active employment and will not be extended by any notice period mandated under local law (e.g., active employment would not include a period of “garden leave” or similar period pursuant to local law); the Committee shall have the exclusive discretion to determine when the Employee is no longer actively employed for purposes of the Stock Options;
(m)
neither the Company, the Employer, nor any Subsidiary or Affiliate will be liable for any foreign exchange rate fluctuation between the Employee’s local currency and the United States dollar that may affect the value of the Stock Options or any amounts due to the Employee pursuant to the settlement of the Stock Options or the subsequent sale of any Shares acquired upon settlement; and
(n)
if the Company determines that the Employee has engaged in misconduct prohibited by Applicable Law or any applicable policy of the Company, as in effect from time to time, or the Company is required to make recovery from the Employee under Applicable Law or a Company policy adopted to comply with applicable legal requirements, then the Company may, in its sole discretion, to the extent it determines appropriate and to the extent permitted under Applicable Law, (a) recover from the Employee the proceeds from Stock Options exercised up to three years prior to the Employee’s termination of employment or any time thereafter, (b) cancel the Employee’s outstanding Stock Options whether or not vested, and (c) take any other action required or permitted by Applicable Law.
13.
Data Privacy Consent.
The Employee hereby explicitly and unambiguously consents to the collection, use and transfer, in electronic or other form, of the Employee’s personal data as described in this Grant Agreement and any other materials by and among, as applicable, the Company, its Affiliates, its Subsidiaries and the Employer for the exclusive purpose of implementing, administering and managing the Employee’s participation in the Plan.
4
The Employee understands that the Company, its Affiliates, its Subsidiaries and the Employer hold certain personal information about the Employee, including, but not limited to, name, home address and telephone number, date of birth, social insurance number or other identification number, salary, nationality, job title, any shares of stock or directorships held in the Company, details of all stock options or any other entitlement to Shares granted, canceled, purchased, exercised, vested, unvested or outstanding in the Employee’s favor (“Data”) for the exclusive purpose of implementing, managing and administering the Plan. The Employee understands that the Data may be transferred to any third parties assisting in the implementation, administration and management
of the Plan, that these recipients may be located in the Employee’s country or elsewhere and that the recipient country may have different data privacy laws and protections than the Employee’s country.
The Employee understands that he or she is providing the consents herein on a purely voluntary basis. If the Employee does not consent, or if he or she later seeks to revoke the consent, the Employee’s employment status or service and career with the Employer will not be adversely affected. The only adverse consequence of refusing or withdrawing consent is that the Company would not be able to grant the Employee Stock Options or other equity awards or administer or maintain such awards. Therefore, the Employee understands that refusing or withdrawing consent may affect his or her ability to participate in the Plan.
The Company is committed to protecting the privacy of the Data in connection with participation in the Plan. By contract with both the Company’s Affiliates and with the Company’s vendors, the people and companies that have access to the Data are bound to handle such Data in a manner consistent with the Company’s Privacy Policy and Applicable Law. The Company also performs due diligence and audits on its vendors in accordance with good commercial practices to ensure their capabilities and compliance with those commitments.
The Employee may request a list with the names and addresses of any potential recipients of the Data by contacting the local human resources representative. The Employee understands that Data will be held only as long as is necessary to implement, administer and manage participation in the Plan.
14.
No Advice Regarding Grant.
The Company is not providing any tax, legal or financial advice, nor is the Company making any recommendations regarding the Employee’s participation in the Plan, or the Employee’s acquisition or sale of the underlying Shares. The Employee is hereby advised to consult with his or her own personal tax, legal and financial advisors regarding his or her participation in the Plan before taking any action related to the Plan.
15.
Plan Information.
The Employee agrees to receive copies of the Plan, the Plan prospectus and other Plan information, including information prepared to comply with laws outside the United States, from the Long-term Incentives website referenced above and stockholder information, including copies of any annual report, proxy and Form 10K, from the investor relations section of the Company’s website at www.hp.com. The Employee acknowledges that copies of the Plan, Plan prospectus, Plan information and stockholder information are available upon written or telephonic request to the Company Secretary. The Employee hereby consents to receive any documents related to current or future participation in the Plan by electronic delivery and agrees to participate in the Plan through an on-line or electronic system established and maintained by the Company or another third party designated by the Company.
16.
Additional Eligibility Requirements Permitted.
In addition to any other eligibility criteria provided for in the Plan, the Company may require that the Employee execute a separate document agreeing to the terms of a current arbitration agreement and/or a current ARCIPD, each in a form acceptable to the Company and/or that the Employee be in compliance with the ARCIPD throughout the entire exercise period. If such separate documents are required by the Company and the Employee does not accept them within 75 days of the Grant Date or such other date as of which the Company shall require in its discretion, this Stock Option shall be canceled and the Employee shall have no further rights under this Grant Agreement.
17.
Miscellaneous.
(a)
The Plan is incorporated herein by reference. The Plan and this Grant Agreement, constitute the entire agreement of the parties with respect to the subject matter hereof and supersede in their entirety all prior undertakings and agreements of the Company and the Employee with respect to the subject matter hereof other than the terms of any severance plan applicable to the Employee that provides more favorable vesting, or extended post-termination exercise periods, and may not be modified adversely to the Employee’s interest except by means of a writing signed by the Company and the Employee. Notwithstanding the foregoing, nothing in the Plan or this Grant Agreement shall affect the validity or interpretation of any duly authorized written agreement between the Company and the Employee under which an award properly granted under and pursuant to the Plan serves as any part of the consideration furnished to the Employee. This Grant Agreement is governed by the laws of the state of Delaware without regard to its conflict of law provisions.
(b)
If the Employee has received this or any other document related to the Plan translated into a language other than English and if the meaning of the translated version is different than the English version, the English version will control.
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(c)
The provisions of this Grant Agreement are severable and if any one or more provisions are determined to be illegal or otherwise unenforceable, in whole or in part, the remaining provisions shall nevertheless be binding and enforceable.
(d)
The Company’s obligations under this Grant Agreement and the Employee’s agreement to the terms of an arbitration agreement and/or an ARCIPD, if any, are mutually dependent. In the event that the Employee breaches the arbitration agreement or the Employee’s ARCIPD is breached or found not to be binding upon the Employee for any reason by a court of law, then the Company will have no further obligation or duty to perform under the Plan or this Grant Agreement.
(e)
Depending on his or her country, the Employee may be subject to insider trading restrictions and/or market abuse laws, which may affect his or her ability to acquire or sell Shares or rights to Shares (e.g., Stock Options) under the Plan during such times as the Employee is considered to have “inside information” regarding the Company (as defined by the laws in the Employee’s country). Any restrictions under these laws or regulations are separate from and in addition to any restrictions that may be imposed under any applicable Company insider trading policy. The Employee is responsible for ensuring compliance with any applicable restrictions and is advised to consult his or her personal legal advisor on this matter.
(f)
The Company reserves the right to impose other requirements on the Employee’s participation in the Plan, on the Stock Options and on any Shares acquired under the Plan, to the extent the Company determines it is necessary or advisable in order to comply with local law or facilitate the administration of the Plan, and to require the Employee to sign any additional agreements or undertakings that may be necessary to accomplish the foregoing.
(g)
A waiver by the Company of a breach of any provision of this Grant Agreement shall not operate or be construed as a waiver of any other provision of this Grant Agreement, or of any subsequent breach by the Employee or any other employee in the Plan.
(h)
The Company shall not be required to treat as owner of Stock Options, or to provide any associated benefits hereunder, any transferee to whom such Stock Options or benefits shall have been transferred in violation of any of the provisions of this Grant Agreement.
(i)
The parties agree to execute such further instruments and to take such action as may reasonably be necessary to carry out the intent of this Grant Agreement.
(j)
All rights granted and/or Shares issued under this Grant Agreement are subject to claw back under the Company policy as in effect from time to time.
(k)
Any notice required or permitted hereunder shall be given in writing and shall be deemed effectively given upon delivery to the Employee at his or her address then on file with the Company.
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HP Inc.
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Dion Weisler
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CEO and President
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Tracy Keogh
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Chief Human Resources Officer
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RETAIN THIS GRANT AGREEMENT FOR YOUR RECORDS
Important Note:
Your grant is subject to the terms and conditions of this Grant Agreement and to the Company obtaining all necessary government approvals. If you have questions regarding your grant, please discuss them with your manager.
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Exhibit 10(q)(q)
GRANT AGREEMENT
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Grant Date:
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Grant ID:
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Amount:
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Plan:
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Vesting Schedule:
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Restricted Stock Units
THIS GRANT AGREEMENT, as of the Grant Date noted above between HP Inc., a Delaware Corporation (“Company”), and the employee named above (“Employee”), is entered into as follows:
WHEREAS, the continued participation of the Employee is considered by the Company to be important for the Company’s continued growth; and
WHEREAS, in order to give the Employee an incentive to continue in the employ of the Company (or its Affiliates or Subsidiaries), to accept ancillary agreements designed to protect the legitimate business interests of the Company that are made a condition of this grant and to participate in the affairs of the Company, the HR and Compensation Committee of the Board of Directors of the Company or its delegates (“Committee”) has determined that the Employee shall be granted restricted stock units representing hypothetical shares of the Company’s common stock (“RSUs”), with each RSU equal in value to one share of the Company’s $0.01 par value common stock (“Share”), subject to the restrictions stated below and in accordance with the terms and conditions of the plan named above (“Plan”), a copy of which can be found on the Long-term Incentives website along with a copy of the related prospectus. The Plan and the related prospectus also can be obtained by written or telephonic request to the Company Secretary. Unless otherwise defined in this Grant Agreement, any capitalized terms in this Grant Agreement shall have the meaning ascribed to such terms in the Plan.
THEREFORE, the parties agree as follows:
1.
Grant of Restricted Stock Units.
Subject to the terms and conditions of this Grant Agreement and of the Plan, the Company hereby grants to the Employee the number of RSUs set forth above.
2.
Vesting Schedule.
The interest of the Employee in the RSUs shall vest according to the vesting schedule set forth above, or if earlier, in accordance with Section 8 or 9, below, except to the extent a severance plan applicable to the Employee provides otherwise. Unless the provisions of Section 8 or 9 apply, the Employee must remain in the employ of the Company, any Subsidiary or Affiliate on a continuous basis through the close of business on the applicable Vesting Date, as set forth above
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and the Employee must be in compliance with the requirements and conditions provided for in the Plan and this Grant Agreement for the interest of the Employee in the RSUs to become fully vested on that date.
3.
Benefit Upon Vesting.
Within 75 days of each Vesting Date set forth on the above vesting schedule or, if earlier, a vesting event pursuant to Section 8 or 9 below, the Company shall deliver or pay, as applicable, to the Employee (or the Employee’s guardian, estate or beneficiary in the
1
event of Section 8 or 9) Shares or a combination of cash and Shares, as the Company determines in its sole discretion, with a value equal to:
(a)
the number of RSUs that have become vested as of such vesting date or vesting event, as applicable, multiplied by the Fair Market Value of a Share on the date on which such RSUs vested; plus
(b)
a dividend equivalent payment determined by:
(1)
Multiplying, separately, the number of RSUs that became vested as determined in Section 3(a) by the dividend per Share on each dividend payment date between the Grant Date and the applicable Vesting Date to determine the dividend equivalent amount for each applicable dividend payment date;
(2)
dividing the amount determined in (1) above by the Fair Market Value of a Share on the dividend payment date to determine the number of additional whole and fractional RSUs to be credited to the Employee; and
(3)
multiplying the number of additional RSUs determined in (2) above by the Fair Market Value of a Share on the Vesting Date to determine the aggregate value of dividend equivalent payments for such vested RSUs;
provided, however, that if any aggregated dividend equivalent payments in Section (b)(2) above to be delivered in Shares results in a payment of a fractional Share, such fractional Share shall be rounded up to the nearest whole Share.
4.
Restrictions.
Except as otherwise provided for in this Grant Agreement, the RSUs or rights granted hereunder may not be sold, pledged or otherwise transferred. The period of time between the Grant Date and the date the RSUs become fully vested pursuant to Section 2 is referred to herein as the “Restriction Period.”
5.
Custody of Restricted Stock Units.
The RSUs subject hereto shall be recorded in an account with the Plan broker in the name of the Employee. Upon termination of the Restriction Period, if the Company determines, in its sole discretion, to deliver Shares pursuant to Section 3 above, such Shares shall be released into the Employee’s account; provided, however, that a portion of such Shares shall be surrendered in payment of Tax-Related Items, as defined and in accordance with Section 11 below, unless the Company, in its sole discretion, establishes alternative procedures for the payment of Tax-Related Items.
6.
No Stockholder Rights.
RSUs represent hypothetical Shares. The Employee shall not be entitled to any of the rights or benefits generally accorded to stockholders until the Shares are issued to the Employee pursuant to the terms of this Grant Agreement and the Employee becomes a holder of record of the Shares following the vesting of the RSUs.
7.
Termination of Employment.
Except as otherwise provided for in this Grant Agreement or in the Plan or as otherwise determined by the Company in its sole discretion, if the Employee’s employment with the Company, any Subsidiary or Affiliate is terminated at any time for any reason prior to the lapse of the Restriction Period, all unvested RSUs granted hereunder shall be forfeited by the Employee, except to the extent a severance plan applicable to the Employee provides otherwise.
For purposes of this Grant Agreement, the Employee’s employment or service will be considered terminated as of the date he or she is no longer actively providing services to the Company, any Subsidiary or Affiliate (regardless of the reason for such termination and whether or not later found to be invalid or in breach of employment laws in the jurisdiction where the Employee is employed or retained or the terms of the Employee’s employment or service agreement, if any) and will not be extended by any notice period (e.g., the Employee’s period of employment or service would not include any contractual notice period or any period of “garden leave” or similar period mandated under the employment laws in the jurisdiction where the Employee is employed or retained or the terms of the Employee’s employment or service agreement, if any). The Committee shall have the exclusive discretion to determine when the Employee’s employment or service is terminated for purposes of this Grant Agreement (including whether the Employee may still be considered to be providing service while on a leave of absence).
8.
Disability of the Employee.
If the Employee’s employment is terminated prior to the end of the Restriction Period by reason of the Employee’s total and permanent disability, all RSUs shall immediately vest including any amounts for dividend equivalent payments on RSUs that vest at termination subject to the condition that the Employee shall have executed a current Agreement Regarding Confidential Information and Proprietary Developments (“ARCIPD”) that is satisfactory to the Company, and shall not have engaged in any conduct that creates a conflict of interest in the opinion of the Company.
9.
Death of the Employee.
In the event of the Employee’s death prior to the end of the Restriction Period, the Employee shall vest in a prorated number of RSUs equal to the total number of RSUs, multiplied by a fraction equal to the number of completed calendar months during which the Employee was employed during the Restriction Period, divided by the number of months in the total Restriction Period, less any shares that vested prior to termination, plus any dividend equivalent payments on such vested RSUs.
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10.
Section 409A.
Payments made pursuant to the Plan and this Grant Agreement are intended to comply with or qualify for an exemption from Section 409A of the Code (“Section 409A”). The Company reserves the right, to the extent the Company deems necessary or advisable in its sole discretion, to unilaterally amend or modify the Plan and/or this Grant Agreement or adopt other policies and procedures (including amendments, policies and procedures with retroactive effect), or take any other actions, including any amendments or actions that would result in the reduction of benefits payable under this Grant Agreement, as the Company determines are necessary or appropriate to ensure that all RSUs are made in a manner that qualifies for an exemption from, or complies with, Section 409A or mitigate any additional tax, interest and/or penalties or other adverse tax consequences that may apply under Section 409A: provided however, that the Company makes no representations that the RSUs will be exempt from any penalties that may apply under Section 409A and makes no undertaking to preclude Section 409A from applying to this RSU. For the avoidance of doubt, the Employee hereby acknowledges and agrees that the Company will have no liability to the Employee or any other party if any amounts payable under this Grant Agreement are not exempt from, or compliant with, Section 409A, or for any action taken by the Company with respect thereto. Any payments under this Grant Agreement, the settlement of which is triggered by a “separation from service” (within the meaning of Section 409A) of a “specified employee” (as defined under Section 409A), shall be made on a date that is the earlier of (a) the Employee’s death or (b) the later of the specified settlement date and the date which is six months after the date of the Employee’s separation from service.
11.
Taxes.
(a)
The Employee shall be liable for any and all taxes, including income tax, social insurance, fringe benefit tax, payroll tax, payment on account, employer taxes or other tax-related items related to the Employee’s participation in the Plan and legally applicable to or otherwise recoverable from the Employee by the Company and/or, if different, the Employee’s employer (the “Employer”) whether incurred at grant, vesting, sale, prior to vesting or at any other time (“Tax-Related Items”). In the event that the Company or the Employer (which, for purposes of this Section 11, shall include a former employer) is required, allowed or permitted to withhold taxes as a result of the RSUs or the Shares acquired pursuant to such RSUs, or due upon receipt of dividend equivalent payments or dividends, the Employee shall surrender a sufficient number of whole Shares, make a cash payment or make adequate arrangements satisfactory to the Company and/or the Employer to withhold such taxes from Employee’s wages or other cash compensation paid to the Employee by the Company and/or the Employer at the election of the Company, in its sole discretion, or, if permissible under local law, the Company may sell or arrange for the sale of Shares that Employee acquires as necessary to cover all Tax-Related Items that the Company or the Employer has to withhold or that are legally recoverable from the Employee (such as fringe benefit tax) at the time the restrictions on the RSUs lapse, unless the Company, in its sole discretion, has established alternative procedures for such payment. However, with respect to any RSUs subject to Section 409A, the Employer shall limit the surrender of Shares to the minimum number of Shares permitted to avoid a prohibited acceleration under Section 409A. The Employee will receive a cash refund for any fraction of a surrendered Share or Shares in excess of any and all Tax-Related Items. To the extent that any surrender of Shares or payment of cash or alternative procedure for such payment is insufficient, the Employee authorizes the Company, its Affiliates and Subsidiaries, which are qualified to deduct tax at source, to deduct from the Employee’s compensation all Tax-Related Items. The Employee agrees to pay any Tax-Related Items that cannot be satisfied from wages or other cash compensation, to the extent permitted by Applicable Law.
To avoid negative accounting treatment, the Company and/or the Employer may withhold or account for Tax-Related Items by considering applicable minimum statutory withholding amounts or other applicable withholding rates, including maximum applicable rates, in which case the Employee will receive a refund of any over-withheld amount in cash and will have no entitlement to the Share equivalent. If the obligation for Tax-Related Items is satisfied by withholding in Shares, for tax purposes, the Employee is deemed to have been issued the full number of Shares subject to the vested RSUs, notwithstanding that a number of the Shares is held back solely for the purpose of paying the Tax-Related Items due as a result of any aspect of the Employee’s participation in the Plan.
(b)
Regardless of any action the Company or the Employer takes with respect to any or all Tax-Related Items, the Employee acknowledges and agrees that the ultimate liability for all Tax-Related Items is and remains the Employee’s responsibility and may exceed the amount actually withheld by the Company or the Employer. The Employee further acknowledges that the Company and/or the Employer: (i) make no representations nor undertakings regarding the treatment of any Tax-Related Items in connection with any aspect of this grant of RSUs or dividend equivalents, including, but not limited to, the grant, vesting or settlement of RSUs or dividend equivalents, the subsequent delivery of Shares and/or cash upon settlement of such RSUs or the subsequent sale of any Shares acquired pursuant to such RSUs and receipt of any dividends or dividend equivalent payments; and (ii) notwithstanding Section 10, do not commit to and are under no obligation to structure the terms or any aspect of this grant of RSUs and/or dividend equivalents to reduce or eliminate the Employee’s liability for Tax-Related Items or to achieve any particular tax result. Further, if the Employee has become subject to tax in more than one jurisdiction, the Employee acknowledges that the Company and/or the Employer may be required to withhold or account for Tax-Related Items in more than one jurisdiction. The Employee shall pay the Company or the Employer any amount of Tax-Related Items that the Company or the Employer may be required to withhold or account for as a result of the Employee’s participation in the Plan or the Employee’s receipt of RSUs that cannot be satisfied by the means previously described. The Company may refuse to deliver the benefit described in Section 3 if the Employee fails to comply with the Employee’s obligations in connection with the Tax-Related Items.
(c)
In accepting the RSUs, the Employee consents and agrees that in the event the RSUs or the dividend equivalents become subject to an employer tax that is legally permitted to be recovered from the Employee, as may be determined by the Company and/or the Employer at their sole discretion, and whether or not the Employee’s employment with the Company
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and/or the Employer is continuing at the time such tax becomes recoverable, the Employee will assume any liability for any such taxes that may be payable by the Company and/or the Employer in connection with the RSUs and dividend equivalents. Further, by accepting the RSUs, the Employee agrees that the Company and/or the Employer may collect any such taxes from the Employee by any of the means set forth in this Section 11. The Employee further agrees to execute any other consents or elections required to accomplish the above, promptly upon request of the Company.
12.
Data Privacy Consent.
(a)
The Employee hereby explicitly and unambiguously consents to the collection, use and transfer, in electronic or other form, of the Employee’s personal data as described in this Grant Agreement and any other materials by and among, as applicable, the Company, the Employer and its other Subsidiaries and Affiliates for the exclusive purpose of implementing, administering and managing the Employee’s participation in the Plan.
(b)
The Employee understands that the Company, the Employer and its other Subsidiaries and Affiliates may hold certain personal information about the Employee, including, but not limited to, name, home address and telephone number, date of birth, social insurance number or other identification number, salary, nationality, residency, status, job title, any shares of stock or directorships held in the Company, details of all RSUs, options or any other entitlement to shares of stock granted, canceled, purchased, exercised, vested, unvested or outstanding in the Employee’s favor (“Data”) for the exclusive purpose of implementing, managing and administering the Plan.
(c)
The Employee understands that Data will be transferred to the Company or one or more stock plan service providers as may be selected by the Company from time to time, which is assisting the Company with the implementation, administration and management of the Plan. The Employee understands that the recipients of the Data may be located in the United States or elsewhere, and that the recipient’s country of operation (e.g., the United States) may have different data privacy laws and protections than the Employee’s country. The Employee understands that if he or she resides outside the United States, the Employee may request a list with the names and addresses of any potential recipients of the Data by contacting his or her local human resources representative. The Employee authorizes the Company and any other possible recipients which may assist the Company (presently or in the future) with implementing, administering and managing the Plan to receive, possess, use, retain and transfer the Data, in electronic or other form, for the sole purposes of implementing, administering and managing the Employee’s participation in the Plan. The Employee understands that Data will be held only as long as is necessary to implement, administer and manage the Employee’s participation in the Plan. The Employee understands that if he or she resides outside the United States, the Employee may, at any time, view Data, request additional information about the storage and processing of Data, require any necessary amendments to Data or refuse or withdraw the consents herein, in any case without cost, by contacting in writing his or her local human resources representative.
(d)
Further, the Employee understands that he or she is providing the consents herein on a purely voluntary basis. If the Employee does not consent, or if the Employee later seeks to revoke his or her consent, the Employee’s employment and career with the Employer will not be affected; the only consequence of refusing or withdrawing the Employee’s consent is that the Company would not be able to grant RSUs or other equity awards to the Employee or administer or maintain such awards. Therefore, the Employee understands that refusing or withdrawing the consent may affect the Employee’s ability to participate in the Plan. For more information on the consequences of the Employee’s refusal to consent or withdrawal of consent, the Employee understands that he or she may contact his or her local human resources representative.
13.
Plan Information.
The Employee agrees to receive copies of the Plan, the Plan prospectus and other Plan information, including information prepared to comply with Applicable Laws outside the United States, from the Long-term Incentives website and stockholder information, including copies of any annual report, proxy and Form 10-K, from the investor relations section of the Company’s website at www.hp.com. The Employee acknowledges that copies of the Plan, Plan prospectus, Plan information and stockholder information are available upon written or telephonic request to the Company Secretary. The Employee hereby consents to receive any documents related to current or future participation in the Plan by electronic delivery and agrees to participate in the Plan through an on-line or electronic system established and maintained by the Company or a third party designated by the Company.
14.
Acknowledgment and Waiver.
By accepting this grant of RSUs, the Employee understands, acknowledges and agrees that:
(a)
except as provided in Sections 8 and 9, the vesting of the RSUs is earned only by continuing as an employee with the Company or one of its Subsidiaries or Affiliates and that being hired and granted RSUs will not result in the RSUs vesting;
(b)
this Grant Agreement and its incorporated documents reflect all agreements on its subject matters and the Employee is not accepting this Grant Agreement based on any promises, representations or inducements other than those reflected in this Grant Agreement;
(c)
all good faith decisions and interpretations of the Committee regarding the Plan and Awards granted under the Plan are binding, conclusive and final;
(d)
the Plan is established voluntarily by the Company, it is discretionary in nature and may be modified, amended, suspended or terminated by the Company at any time;
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(e)
the grant of RSUs is voluntary and occasional and does not create any contractual or other right to receive future grants of RSUs or other awards, or benefits in lieu of RSUs, even if Shares or RSUs have been granted in the past;
(f)
all decisions with respect to future grants, if any, will be at the sole discretion of the Company;
(g)
the Employee’s participation in the Plan shall not create a right to further employment with the Employer and shall not interfere with the ability of the Employer to terminate the Employee’s employment relationship at any time and it is expressly agreed and understood that employment is terminable at the will of either party;
(h)
the Employee is voluntarily participating in the Plan;
(i)
RSUs and their resulting benefits are extraordinary items that are outside the scope of the Employee’s employment contract, if any;
(j)
RSUs and their resulting benefits are not intended to replace any pension rights or compensation;
(k)
RSUs and their resulting benefits are not part of normal or expected compensation or salary for any purposes, including, but not limited to calculating any severance, resignation, termination, redundancy, dismissal, end of service payments, bonuses, long-service awards, pension or retirement or welfare benefits or similar payments;
(l)
unless otherwise agreed by the Company, the RSUs and their resulting benefits are not granted as consideration for, or in connection with, the service the Employee may provide as a director of a Subsidiary or Affiliate;
(m)
this grant of RSUs will not be interpreted to form an employment contract or relationship with the Company, and furthermore, this grant of RSUs will not be interpreted to form an employment contract with any Subsidiary or Affiliate;
(n)
the future value of the underlying Shares is unknown, indeterminable and cannot be predicted with certainty;
(o)
no claim or entitlement to compensation or damages shall arise from forfeiture of the RSUs resulting from termination of Employee’s employment (regardless of the reason for such termination and whether or not later found to be invalid or in breach of employment laws in the jurisdiction where the Employee is employed or retained or the terms of the Employee’s employment or service agreement, if any), and in consideration of the grant of the RSUs to which the Employee is otherwise not entitled, the Employee irrevocably agrees never to institute any claim against the Company, the Employer or any other Subsidiary or Affiliate and releases the Company, the Employer and any other Subsidiary and Affiliate from any such claim; if, notwithstanding the foregoing, any such claim is allowed by a court of competent jurisdiction, then, by participating in the Plan, the Employee shall be deemed irrevocably to have agreed not to pursue such claim and to have agreed to execute any and all documents necessary to request dismissal or withdrawal of such claims;
(p)
the Company, the Employer or any other Subsidiary or Affiliate will not be liable for any foreign exchange rate fluctuation between the Employee’s local currency and the United States dollar that may affect the value of the RSUs or any amounts due to the Employee pursuant to the settlement of the RSUs or the subsequent sale of any Shares acquired upon settlement;
(q)
if the Company determines that the Employee has engaged in misconduct prohibited by Applicable Law or any applicable policy of the Company, as in effect from time to time, or the Company is required to make recovery from the Employee under Applicable Law or a Company policy adopted to comply with applicable legal requirements, then the Company may, in its sole discretion, to the extent it determines appropriate, (i) recover from the Employee the proceeds from RSUs vested up to three years prior to the Employee’s termination of employment or any time thereafter, (ii) cancel the Employee’s outstanding RSUs, and (iii) take any other action it deems to be required and appropriate; and
(r)
the delivery of any documents related to the Plan or Awards granted under the Plan, including the Plan, this Grant Agreement, the Plan prospectus and any reports of the Company generally provided to the Company’s stockholders, may be made by electronic delivery. Such means of electronic delivery may include the delivery of a link to a Company intranet or the Internet site of a third party involved in administering the Plan, the delivery of the document via electronic mail or other such means of electronic delivery specified by the Company. The Employee may receive from the Company a paper copy of any documents delivered electronically at no cost to the Employee by contacting the Company in writing in accordance with Section 17(k). If the attempted electronic delivery of any document fails, the Employee will be provided with a paper copy of such document. The Employee may revoke his or her consent to the electronic delivery of documents or may change the electronic mail address to which such documents are to be delivered (if the Employee has provided an electronic mail address) at any time by notifying the Company of such revoked consent or revised electronic mail address in accordance with Section 17(k). The Employee is not required to consent to the electronic delivery of documents.
15.
No Advice Regarding Grant.
The Company is not providing any tax, legal or financial advice, nor is the Company making any recommendations regarding the Employee’s participation in the Plan, or the Employee’s acquisition or sale of the underlying Shares. The Employee is hereby advised to consult with his or her own personal tax, legal and financial advisors regarding his or her participation in the Plan before taking any action related to the Plan.
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16.
Additional Eligibility Requirements Permitted.
In addition to any other eligibility criteria provided for in the Plan, the Company may require that the Employee execute a separate document agreeing to the terms of a current arbitration agreement and/or a current ARCIPD, each in a form acceptable to the Company and/or that the Employee be in compliance with the ARCIPD throughout the entire Restriction Period and through the date the RSU is to be granted or settled. If such separate documents are required by the Company and the Employee does not accept them within 75 days of the Grant Date or such other date as of which the Company shall require in its discretion, this RSU shall be canceled and the Employee shall have no further rights under this Grant Agreement.
17.
Miscellaneous.
(a)
The Company shall not be required to treat as owner of RSUs and any associated benefits hereunder, any transferee to whom such RSUs or benefits shall have been transferred in violation of any of the provisions of this Grant Agreement.
(b)
The parties agree to execute such further instruments and to take such action as may reasonably be necessary to carry out the intent of this Grant Agreement.
(c)
The Plan is incorporated herein by reference. The Plan and this Grant Agreement constitute the entire agreement of the parties with respect to the subject matter hereof and supersede in their entirety all prior undertakings and agreements of the Company and the Employee with respect to the subject matter hereof, other than the terms of any severance plan applicable to the Employee that provides more favorable vesting. Notwithstanding the foregoing, nothing in the Plan or this Grant Agreement shall affect the validity or interpretation of any duly authorized written agreement between the Company and the Employee under which an award properly granted under and pursuant to the Plan serves as any part of the consideration furnished to the Employee. This Grant Agreement is governed by the laws of the state of Delaware without regard to its conflict of law provisions.
(d)
If the Employee has received this or any other document related to the Plan translated into a language other than English and if the meaning of the translated version is different than the English version, the English version will control.
(e)
The provisions of this Grant Agreement are severable and if any one or more provisions are determined to be illegal or otherwise unenforceable, in whole or in part, the remaining provisions shall nevertheless be binding and enforceable.
(f)
Notwithstanding Section 17(e), the Company’s obligations under this Grant Agreement and the Employee’s agreement to the terms of an arbitration agreement and/or an ARCIPD, if any, are mutually dependent. In the event that the Employee breaches the arbitration agreement or the Employee’s ARCIPD is breached or found not to be binding upon the Employee for any reason by a court of law, then the Company will have no further obligation or duty to perform under the Plan or this Grant Agreement.
(g)
A waiver by the Company of a breach of any provision of this Grant Agreement shall not operate or be construed as a waiver of any other provision of this Grant Agreement, or of any subsequent breach by the Employee or any other Awardee.
(h)
The Employee acknowledges that, depending on his or her country, the Employee may be subject to insider trading restrictions and/or market abuse laws, which may affect the Employee’s ability to acquire or sell Shares or rights to Shares (
e.g.,
RSUs) under the Plan during such times as the Employee is considered to have “inside information” regarding the Company (as defined by the laws in the Employee’s country). Any restrictions under these laws or regulations are separate from and in addition to any restrictions that may be imposed under any applicable Company insider trading policy. The Employee is responsible for ensuring compliance with any applicable restrictions and is advised to consult his or her personal legal advisor on this matter.
(i)
The Company reserves the right to impose other requirements on the Employee’s participation in the Plan, on the RSUs and on any Shares acquired under the Plan, to the extent the Company determines it is necessary or advisable for legal or administrative reasons, and to require the Employee to sign any additional agreements or undertakings that may be necessary to accomplish the foregoing.
(j)
Any notice required or permitted hereunder to the Employee shall be given in writing and shall be deemed effectively given upon delivery to the Employee at the address then on file with the Company.
(k)
Any notice to be given under the terms of this Grant Agreement to the Company will be addressed in care of Attn: Global Equity Administration at HP Inc., 1501 Page Mill, Palo Alto, California 94304, USA.
(l)
The Employee acknowledges that there may be certain foreign asset and/or account reporting requirements which may affect his or her ability to acquire or hold Shares acquired under the Plan or cash received from participating in the Plan (including from any dividends or dividend equivalent payments) in a brokerage or bank account outside the Employee’s country. The Employee may be required to report such accounts, assets or transactions to the tax or other authorities in his or her country. The Employee also may be required to repatriate sale proceeds or other funds received as a result of the Employee’s participation in the Plan to his or her country through a designated bank or broker within a certain time after receipt. The Employee acknowledges that it is his or her responsibility to be compliant with such regulations, and the Employee is advised to consult his or her personal legal advisor for any details.
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APPENDIX
HP INC. 2004 STOCK INCENTIVE PLAN, AS AMENDED
GRANT AGREEMENT FOR NON-U.S. EMPLOYEES
Capitalized terms used but not defined herein shall have the meanings ascribed to them in the Grant Agreement or the Plan.
This Appendix includes additional terms and conditions that govern the RSUs granted to the Employee if the Employee resides and/or works in one of the countries listed herein. This Appendix is part of the Grant Agreement.
If the Employee is a citizen or resident (or is considered as such for local law purposes) of a country other than the country in which the Employee is currently residing and/or working, or if the Employee transfers to another country after the Grant Date, the Company shall, in its discretion, determine to what extent the special terms and conditions contained herein shall be applicable to the Employee.
This Appendix also includes information and notices regarding securities, exchange control, tax and certain other issues of which the Employee should be aware with respect to his or her participation in the Plan. The information is based on the securities, exchange control, tax and other laws in effect in the respective countries as of September 2015. Such laws are often complex and change frequently. As a result, the Company strongly recommends that the Employee not rely on the information contained herein as the only source of information relating to the consequences of his or her participation in the Plan because the information may be out of date at the time the Employee vests in the RSUs, receives Shares, a cash payment or a dividend equivalent payment upon vesting, sells any Shares acquired under the Plan or receive dividends paid on such Shares. In addition, the information is general in nature and may not apply to the Employee’s particular situation, and the Company is not in a position to assure the Employee of any particular result. Therefore, the Employee is advised to seek appropriate professional advice as to how the relevant laws in his or her country may apply to the Employee’s individual situation.
If the Employee is a citizen or resident (or is considered as such for local law purposes) of a country other than the country in which the Employee is currently residing and/or working, or if the Employee transfers to another country after the Grant Date, the information contained herein may not be applicable to the Employee in the same manner.
ALBANIA
Securities Notice
Securities approval is required for the resale of Shares in Albania for Albanian residents.
ALGERIA
Payout of RSUs in Cash Only
Pursuant to the Company’s discretion under Section 2(ii) of the Plan and notwithstanding the language in Section 3 of the Grant Agreement, due to legal considerations in Algeria, the RSUs granted to Employees in Algeria shall be settled in cash only, paid through local payroll (less any Tax-Related Items and/or fees) and do not provide any right for the Employee to receive Shares.
ANGOLA
Securities Notice
The Plan is not an offer to the public in Angola. RSUs are granted only to employees of the Company and its Subsidiaries and Affiliates. Any securities granted under the Plan are not negotiable in Angola.
Payout of RSUs in Cash Only
Pursuant to the Company’s discretion under Section 2(ii) of the Plan and notwithstanding the language in Section 3 of the Grant Agreement, due to legal considerations in Angola, the RSUs granted to Employees in Angola shall be settled in cash only (less any Tax-Related Items and/or fees) and do not provide any right for the Employee to receive Shares.
Exchange Control Notice
All proceeds from the vesting of the RSUs and cash payment are required to be repatriated to Angola.
ARGENTINA
Securities Notice
Shares of the Company are not publicly offered or listed on any stock exchange in Argentina. The offer is private and not subject to the supervision of any Argentine governmental authority.
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Exchange Control Notice
If the Employee transfers proceeds realized under the Plan (
e.g.
, from the sale of Shares) into Argentina within ten days of receipt (i.e., the proceeds have not been held in an offshore bank or brokerage account for at least ten days prior to transfer), the Employee must deposit 30% of the proceeds into a non-interest bearing account in Argentina for 365 days. If the Employee has satisfied the ten day holding obligation, the Argentine bank handling the transaction may still request certain documentation in connection with the Employee’s request to transfer proceeds into Argentina, including evidence of the sale and proof that no funds were remitted out of Argentina to acquire the Shares. Please note that exchange control regulations in Argentina are subject to frequent change. The Employee should consult with his or her personal legal advisor regarding any exchange control obligations he or she may have in connection with his or her participation in the Plan.
Foreign Asset/Account Reporting Notice
Argentine residents must report any Shares acquired under the Plan and held by the resident on December 31st of each year on their annual tax return for that year. Argentine residents should consult with their personal tax advisor to determine their personal reporting obligations.
AUSTRALIA
Breach of Law
. Notwithstanding anything to the contrary in the Plan or the Grant Agreement, the Employee will not be entitled to, and shall not claim any benefit (including without limitation a legal right) under the Plan if the provision of such benefit would give rise to a breach of Part 2D.2 of the Corporations Act 2001 (Cth), any other provision of that Act, or any other applicable statute, rule or regulation which limits or restricts the giving of such benefits. Further, the employer is under no obligation to seek or obtain the approval of its stockholders in a general meeting for the purpose of overcoming any such limitation or restriction.
Australian Offer Document
The Employee’s right to participate in the Plan and the RSUs granted under the Plan are subject to the terms and conditions stated in the Offer Document, the Plan, the Grant Agreement and this Appendix. By accepting the RSUs, the Employee acknowledges and confirms that he or she has reviewed these documents.
Securities Notice
If the Employee acquires Shares under the Plan and subsequently offers to sell the Shares to a person or entity resident in Australia, such offer may be subject to disclosure requirements under Australian law. The Employee should obtain legal advice regarding any applicable disclosure requirements prior to making any such offer.
Exchange Control Notice
Exchange control reporting is required for cash transactions exceeding AUD10,000 and for international fund transfers. If an Australian bank is assisting with the transaction, the bank will file the report on behalf of the Employee.
AUSTRIA
Exchange Control Notice
If the Employee holds Shares acquired under the Plan outside of Austria, the Employee will be required to submit reports to the Austrian National Bank as follows: (i) on a quarterly basis if the value of the Shares as of any given quarter exceeds €30,000,000; and (ii) on an annual basis if the value of the Shares as of December 31 exceeds €5,000,000. If quarterly reporting is required, the reports must be filed by the fifteenth day of the month following the last day of the respective quarter. The deadline for filing the annual report is January 31 of the following year.
If the Employee sells Shares or receives any cash dividends or dividend equivalent payments, the Employee may have exchange control obligations if he or she holds the cash proceeds outside of Austria. If the transaction volume of all the Employee’s accounts abroad exceeds €10,000,000, the Employee must report the movements and balances of all accounts on a monthly basis, as of the last day of the month, on or before the fifteenth day of the following month,
on the prescribed form (
Meldungen SI-Forderungen und/oder SI-Verpflichtungen
).
Consumer Protection Notice
The Employee may be entitled to revoke the RSUs on the basis of the Austrian Consumer Protection Act under the following conditions:
(i)
The revocation must be made within one week of the day the Employee accepts the Grant Agreement.
(ii)
The revocation must be in written form to be valid. It is sufficient if the Employee returns the Grant Agreement to the Company or the Company’s representative with language which can be understood as a refusal to conclude or honor the Grant Agreement, provided the revocation is sent within the period discussed above.
8
AZERBAIJAN
Payout of RSUs in Cash Only
Pursuant to the Company’s discretion under Section 2(ii) of the Plan and notwithstanding the language in Section 3 of the Grant Agreement, due to legal considerations in Azerbaijan, the RSUs granted to Employees in Azerbaijan shall be settled in cash only (less any Tax-Related Items and/or fees) and do not provide any right for the Employee to receive Shares.
BAHRAIN
There are no country-specific provisions.
BANGLADESH
Securities Law Notice
The RSUs shall not be publicly offered or listed on any stock exchange in Bangladesh. The offer is intended to be private and the Grant Agreement does not constitute a prospectus for purposes of the 1969 Securities and Exchange Ordinance, as amended.
Payout of RSUs in Cash Only
Pursuant to the Company’s discretion under Section 2(ii) of the Plan and notwithstanding the language in Section 3 of the Grant Agreement, due to legal considerations in Bangladesh, the RSUs granted to Employees in Bangladesh shall be settled in cash only (less any Tax-Related Items and/or fees) and do not provide any right for the Employee to receive Shares.
BELARUS
Exchange Control Notice
The Employee should obtain a permit from the National Bank of Belarus (“National Bank”) prior to acquiring Shares upon vesting of the RSUs. To obtain the permit, it is necessary to submit certain documents to the National Bank, likely including: (i) an application in a prescribed form; (ii) a copy of a personal identification document (e.g., passport); (iii) information on the Shares to be acquired (e.g., type, number, par value, name of the issuer); and (iv) a copy of the Grant Agreement. The Employee understands that if he or she fails to obtain a National Bank permit prior to vesting, the Employee may be subject to an administrative fine.
Please note that exchange control regulations in Belarus are subject to change. The Employee should consult with his or her personal legal advisor regarding any exchange control obligations that the Employee may have prior to acquiring Shares or receiving proceeds under the Plan. The Employee is responsible for ensuring compliance with all exchange control laws in Belarus.
BELGIUM
Foreign Asset/Account Reporting Notice
The Employee is required to report any bank accounts opened and maintained outside of Belgium on his or her annual tax return. In a separate report, the Employee may be required to provide the National Bank of Belgium with certain details regarding such foreign accounts (including the account number, bank name and country in which any such account was opened). This report, as well as additional information on how to complete it, can be found on the website of the National Bank of Belgium, www.nbb.be, under
Kredietcentrales / Centrales des crédits
caption. The Employee should consult with his or her personal tax advisor to determine his or her personal reporting obligations.
BOSNIA AND HERZEGOVINA
There are no country-specific provisions.
BOTSWANA
There are no country-specific provisions.
BRAZIL
Exchange Control Notice
The Employee is required to prepare and submit a declaration of assets and rights held outside of Brazil to the Central Bank on an annual basis. The assets and rights that must be reported include Shares issued under the Plan. However, if the Employee holds assets or rights valued at less than US$100,000, the Employee will not be required to submit a declaration. If such amount exceeds US$100,000,000, the referred declaration is required quarterly.
9
Intent to Comply with Law
By accepting the RSUs, the Employee acknowledges his or her agreement to comply with applicable Brazilian laws and to report and pay any and all applicable taxes associated with the vesting of the RSUs, the sale of any Shares acquired upon vesting of the RSUs and the receipt of any dividends or dividend equivalents.
Tax on Financial Transaction (IOF)
If the Employee repatriates the proceeds from the sale of Shares and any cash dividends into Brazil and converts the funds into local currency, he or she will be subject to the Tax on Financial Transactions.
Labor Law Acknowledgment
This provision supplements Section 14 of the Grant Agreement:
By accepting this grant of RSUs, the Employee understands, acknowledges and agrees that:, for all legal purposes: (i) the benefits provided to the Employee under the Plan are unrelated to his or her employment; (ii) the Plan is not a part of the terms and conditions of the Employee’s employment; and (iii) the income from the RSUs, if any, is not part of the Employee’s remuneration from employment.
BULGARIA
Exchange Control Notice
If the Employee receives a payment related to the Plan in Bulgaria in excess of BGN100,000 (or its equivalent in another currency, e.g., U.S. dollars), the Employee is required to submit a form with information regarding the source of the income to the bank receiving such payment (for statistical purposes) upon transfer or within 30 days of receipt. The Employee should contact his or her bank in Bulgaria for additional information regarding this requirement.
CANADA
Payout of RSUs in Shares Only
Pursuant to its discretion under Section 2(ii) of the Plan,
with respect to all Employees residing in Canada, the Company will convert all vested RSUs only into an equivalent number of Shares. Employees residing in Canada (or in the event of death, such Employee’s legal representative or estate) will not receive an equivalent or fractional Share cash payment with respect to vested RSUs.
Data Privacy
The following provision supplements Section 12 of the Grant Agreement:
The Employee hereby authorizes the Company and the Company’s representatives to discuss with and obtain all relevant information from all personnel, professional or not, involved in the administration and operation of the Plan. The Employee further authorizes the Company and any Subsidiary or Affiliate and the administrator of the Plan to disclose and discuss the Plan with their advisors. The Employee further authorizes the Company and any Subsidiary or Affiliate to record such information and to keep such information in the Employee’s employee file.
Termination of Employment
The following provision replaces the second paragraph of Section 7 of the Grant Agreement:
For purposes of this Grant Agreement, the Employee’s employment or service will be considered terminated as of the earlier of: (a) the date on which the Employee’s employment is terminated; (b) the date the Employee receives notice of termination of employment from the Employer; or (c) the date on which the Employee is no longer actively employed by or actively providing services, regardless of any notice period or period of pay in lieu of such notice required under Applicable Law (including, but not limited to, statutory law, regulatory law and/or common law). The Committee shall have the exclusive discretion to determine when the Employee’s employment or service is terminated for purposes of this Grant Agreement (including whether the Employee may still be considered to be providing service while on a leave of absence).
Foreign Asset/Account Reporting Notice
.
If the total value of the Employee’s foreign property exceeds C$100,000 at any time during the year, the Employee must report all of his or her foreign property on Form T1135 (Foreign Income Verification Statement) by April 30 of the following year. Foreign property includes Shares acquired under the Plan and may include the RSUs. The RSUs must be reported—generally at a nil cost—if the $100,000 cost threshold is exceeded because of other foreign property the Employee holds. If Shares are acquired, their cost generally is the adjusted cost base (“ACB”) of the Shares. The ACB would normally equal the fair market value of the Shares at vesting, but if the Employee owns other shares, this ACB may have to be averaged with the ACB of the other shares. The Employee should speak with a personal tax advisor to determine the scope of foreign property that must be considered for purposes of this requirement.
Securities Law Notice
The Employee is permitted to sell Shares acquired in settlement of the RSUs through the designated broker appointed under the Plan provided the resale of Shares acquired in settlement of the RSUs takes place outside of Canada through facilities of a stock exchange on which the Shares are listed. The Shares are currently listed on the New York Stock Exchange in the United States under the ticker symbol “HPQ”.
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The following provisions will also apply to Employees who are resident in Quebec:
Consent to Receive Information in English
The parties acknowledge that it is their express wish that the Grant Agreement, as well as all documents, notices and legal proceedings entered into, given or instituted pursuant hereto or relating directly or indirectly hereto, be drawn up in English.
Les parties reconnaissent avoir exigé la rédaction en anglais de la convention («Grant Agreement»), ainsi que de tous documents, avis et procédures judiciaires, exécutés, donnés ou intentés en vertu de, ou liés directement ou indirectement à, la présente convention
.
Plan Document Acknowledgment
In accepting the grant of RSUs, the Employee acknowledges that he or she has received a copy of the Plan, has reviewed the Plan and the Grant Agreement in their entirety and fully understands and accepts all provisions of the Plan and the Grant Agreement.
CHILE
Securities Law Notice
.
The offer of RSUs constitutes an offering of securities in Chile subject to General Ruling N° 345 (“NCG 345”) of the Chilean Superintendence of Securities and Insurance (“SVS”). This offer refers to securities not registered at the securities registry or at the foreign securities registry of the SVS, and therefore, such securities are not subject to oversight of the SVS. Given that that the RSUs are not registered in Chile, the Company is not required to provide public information about the RSUs or shares of common stock in Chile. Unless the securities offered are registered with the SVS, a public offering of such securities cannot be made in Chile, unless the offer complies with the conditions set forth in NCG 345.
Información bajo la Ley de Mercado de Valores
Esta oferta de Unidades de Acciones Restringidas (“RSU”) constituye uno oferta sujeta a la norma de carácter general N°345 (“NCG 345”) de la superintendenceia de valores y seguros de Chile (“SVS”). Esta oferta versa sobre valores no inscritos en el registro de valores o en el registro de valores extranjeros que lleva la SVS, por lo que tales valores no están sujetos a la fiscalización de ésta. Por tratarse los RSU de valores no inscritos en Chile no existe la obligación por parte del emisor de entregar en Chile información pública respecto de los RSU o de las acciones. Estos valores no podrán ser objecto de oferta pública respecto de los RSUs o de las acciones. Estos valores no podrán ser objeto de oferta pública en Chile mientras no sean inscritos en el registro de valores correspondiente, a menos que la oferta cumpla con las condiciones establecidas en la NCG 345.
Exchange Control Notice.
The Employee is not required to repatriate funds obtained from the sale of Shares or the receipt of any dividends or dividend equivalents. However, if the Employee decides to repatriate such funds, the Employee must do so through the Formal Exchange Market if the amount of the funds exceeds US$10,000. In such case, the Employee must report the payment to the commercial bank or registered foreign exchange office receiving the funds.
The Employee is responsible for complying with foreign exchange requirements in Chile. For general information purposes, as of the date hereof, the Employee’s aggregate investments held outside of Chile exceed US$5,000,000 (including the Shares and any other cash proceeds obtained under the Plan), the Employee must report the investments annually to the Central Bank. Annex 3.1 of Chapter XII of the Foreign Exchange Regulations must be used to file this report. Please note that exchange control regulations in Chile are subject to change. The Employee should consult with his or her personal legal advisor regarding any exchange control obligations that the Employee may have prior to vesting in the RSUs, receiving proceeds from the sale of Shares acquired upon vesting of the RSUs or cash dividends or dividend equivalents.
Foreign Asset/Account Reporting Notice
The Chilean Internal Revenue Service (“CIRS”) requires all taxpayers to provide information annually regarding: (i) the taxes paid abroad which they will use as a credit against Chilean income taxes and (ii) the results of foreign investments. These annual reporting obligations must be complied with by submitting a sworn statement setting forth this information before June 30 of each year. The forms to be used to submit the sworn statement are Tax Form 1853 “Annual Sworn Statement Regarding Foreign Source Income” and Tax Form 1851 “Annual Sworn Statement Regarding Investments Held Abroad.” If the Employee is not a Chilean citizen and has been a resident in Chile for less than three years, the Employee is exempt from the requirement to file Tax Form 1853. These statements must be submitted electronically through the CIRS website: www.sii.cl.
CHINA
Payout of RSUs in Cash Only
Pursuant to the Company’s discretion under Section 2(ii) of the Plan and notwithstanding the language in Section 3 of the Grant Agreement, due to exchange control restrictions in
People’s Republic of China (the “PRC”), the RSUs granted to Employees in China shall be settled in cash only (less any Tax-Related Items and/or fees) and do not provide any right for the Employee to receive Shares.
11
Exchange Control
The following terms and conditions will apply to Employees who are subject to exchange control restrictions and regulations in the PRC, including the requirements imposed by the State Administration of Foreign Exchange (“SAFE”), as determined by the Company in its sole discretion:
The Employee understands and agrees that, pursuant to local exchange control requirements, the Employee will not be permitted to vest in an RSU or be issued any Shares under the Plan unless or until the Company, its Subsidiary or the Employer in the PRC has obtained an approval from SAFE for the Plan.
The Employee further understands and agrees that, pursuant to local exchange control requirements, the Employee will be required to immediately repatriate any cash payments or proceeds obtained with respect to participation in the Plan to the PRC. The Employee further understands that such repatriation of any cash payments or proceeds may need to be effectuated through a special exchange control account established by the Company, any Parent or Subsidiary, or the Employer, and the Employee hereby consents and agrees that any payment or proceeds may be transferred to such special account prior to being delivered to the Employee.
Any payment or proceeds may be paid to the Employee in U.S. dollars or local currency at the Company’s discretion. If the payments or proceeds are paid to the Employee in U.S. dollars, the Employee will be required to set up a U.S. dollar bank account in the PRC so that the payments or proceeds may be deposited into this account. If the payments or proceeds are paid to the Employee in local currency, the Company is under no obligation to secure any particular exchange conversion rate and the Company may face delays in converting the payments or proceeds to local currency due to exchange control restrictions.
The Employee further agrees to comply with any other requirements that may be imposed by the Company in the future to facilitate compliance with exchange control requirements in the PRC.
COLOMBIA
Labor Law Acknowledgement
The following provision supplements Section 14 of the Grant Agreement:
The Employee acknowledges that pursuant to Article 128 of the Colombian Labor Code, the Plan and related benefits do not constitute a component of the Employee’s “salary” for any legal purpose.
Exchange Control Notice
If the Employee holds investments outside Colombia (including Shares the Employee acquires under the Plan) and the aggregate value of such investments is US$500,000 or more as of December 31 of any year, the Employee will be required to register such investments with the Central Bank (
Banco de la República
) as foreign investments held abroad. Upon the subsequent sale or other disposition of any previously-registered investments, the Employee is not required to repatriate the sale proceeds to Colombia. However, the Employee must cancel the registration with the Central Bank by no later than March 31 of the year following the year in which such sale or disposition occurred. The Employee may be subject to fines if they fail to cancel such registration.
CONGO (BRAZZAVILLE)
Exchange Control Notice
All proceeds from the vesting of RSUs, the sale of Shares and any cash dividends or dividend equivalents are required to be repatriated to Congo (Brazzaville).
COSTA RICA
There are no country-specific provisions.
CROATIA
Exchange Control Notice
The Employee must report any foreign investments (including Shares acquired under the Plan) to the Croatian National Bank for statistical purposes and obtain prior approval of the Croatian National Bank for bank accounts opened abroad. However, because exchange control regulations may change without notice, the Employee should consult with his or her personal legal advisor to ensure compliance with current regulations. It is the Employee’s responsibility to comply with Croatian exchange control laws.
CZECH REPUBLIC
Exchange Control Notice
Upon request of the Czech National Bank (“CNB”), the Employee may need to fulfill certain notification duties when he or she acquires Shares upon vesting of the RSUs and the opening and maintenance of a foreign account. Even in the absence of a request from the
12
CNB, the Employee may need to report foreign direct investments with a value of CZK2,500,000 or more in the aggregate and/or other foreign financial assets with a value of CZK200,000,000 or more. However, because exchange control regulations change frequently and without notice, the Employee should consult with his or her personal legal advisor prior to the vesting of the RSUs and the sale of Shares to ensure compliance with current regulations. It is the Employee’s responsibility to comply with any applicable Czech exchange control laws.
DENMARK
Danish Stock Option Act
By participating in the Plan, the Employee acknowledges that he or she received an Employer Statement translated into Danish, which is being provided to comply with the Danish Stock Option Act. To the extent more favorable to the Employee, the terms set forth in the Employer Statement will apply to the Employee’s participation in the Plan.
Foreign Asset/Account Reporting Notice
The Employee understands that if he or she establishes an account holding Shares or an account holding cash outside of Denmark, they must report the account to the Danish Tax Administration. The form which should be used in this respect can be obtained from a local bank. (These obligations are separate from and in addition to the obligations described below.)
Securities/Tax Reporting Notice
If the Employee holds Shares acquired under the Plan in a brokerage account with a broker or bank outside of Denmark, the Employee is required to inform the Danish Tax Administration about the account. For this purpose, the Employee must file a Form V (
Erklaering V
) with the Danish Tax Administration. The Form V must be signed both by the Employee and by the applicable broker or bank where the account is held, unless an exemption from the broker/bank signature requirement is obtained from the Danish Tax Administration. It is possible to seek an exemption on the Form V, and it is strongly recommended that it be done at the time the Form V is submitted. The Employee understands that by signing the Form V, the broker or bank (to the extent the exemption is not obtained) and the Employee undertake to forward information to the Danish Tax Administration concerning the Shares in the account without further request each year. In the event that an exemption is not obtained and the applicable broker or bank with which the account is held does not wish to, or pursuant to the laws of the country in question, is not allowed to assume such obligation to report, the Employee acknowledges that he or she is solely responsible for providing certain details regarding the foreign brokerage account and Shares deposited therein to the Danish Tax Administration as part of the Employee’s annual income tax return. By signing the Form V, the Employee authorizes the Danish Tax Administration to examine the account. A sample of Form K can be found at the following website: www.skat.dk.
In addition, the Employee acknowledges that if he or she opens a brokerage account (or a deposit account with a U.S. bank) for the purpose of holding cash outside Denmark, the Employee is also required to inform the Danish Tax Administration of this account. To do so, the Employee must file a Form K (
Erklaering K
) with the Danish Tax Administration. The Form K must be signed both the Employee and by the applicable broker or bank where the account is held, unless an exemption from the broker/bank signature requirement is obtained from the Danish Tax Administration. It is possible to seek an exemption on the Form K, and it is strongly recommended that it be done at the time the Form V is submitted. The Employee understands that by signing the Form K, the broker or bank (to the extent the exemption is not obtained) and the Employee undertake an obligation to forward information to the Danish Tax Administration concerning the content of the account without further request each year. In the event that an exemption is not obtained and the applicable broker or bank with which the account is held, does not wish to, or pursuant to the laws of the country in question, is not allowed to assume such obligation to report, the Employee acknowledges that he or she is solely responsible for providing certain details regarding the foreign brokerage or bank account to the Danish Tax Administration as part of the Employee’s annual income tax return. The Employee understands that, by signing the Form K, the Employee authorizes the Danish Tax Administration to examine the account. A sample of Form K can be found at the following website: www.skat.dk.
ECUADOR
There are no country-specific provisions.
EGYPT
Exchange Control Notice
If the Employee transfers funds into Egypt in connection with the remittance of proceeds from the vesting of RSUs, sale of Shares or the receipt of any dividends or dividend equivalent payments, the Employee is required to transfer the funds through a bank registered in Egypt.
FINLAND
There are no country-specific provisions.
13
FRANCE
Language Consent
By accepting the grant of the RSUs, the Employee confirms having read and understood the Plan and the Grant Agreement, which were provided in English language. The
Employee accepts the terms of those documents accordingly.
Consentement Relatif à la Langue Utilisée
En acceptant cette attribution d’actions gratuites, l’Employé confirme avoir lu et compris le Plan et le Contrat d’Attribution qui m’ont été transmis en langue anglaise. L’Employé accepte les termes et conditions incluses dans ces documents en connaissance de cause.
Foreign Asset/Account Reporting Information
The Employee is required to report all foreign accounts (whether open, current or closed) to the French tax authorities when filing his or her annual tax return. The Employee should consult his or her personal advisor to ensure compliance with applicable reporting obligations.
GERMANY
Exchange Control Notice
Cross-border payments in excess of €12,500 must be reported monthly to the German Federal Bank. If the Employee receives a cross-border payment in excess of €12,500 (e.g., proceeds from the sale of Shares acquired under the Plan), he or she must report the payment to German Federal Bank electronically using the “General Statistics Reporting Portal” available via the Bank’s website (www.bundesbank.de). The Employee should file the report by the fifth day of the month following the month in which the payment is made.
GHANA
There are no country-specific provisions.
GREECE
There are no country-specific provisions.
GUATEMALA
Language Consent
By participating in the Plan, the Employee acknowledges that he or she is proficient in reading and understanding English and fully understands the terms of the Plan and the Grant Agreement.
HONG KONG
Securities Warning
The contents of this document have not been reviewed by any regulatory authority in Hong Kong. The Employee is advised to exercise caution in relation to the offer. If the Employee is in any doubt about any of the contents of this document, he or she should obtain independent professional advice.
The RSUs and Shares acquired upon vesting of the RSUs do not constitute a public offering of securities under Hong Kong law and are available only to employees of the Company or any Subsidiary or Affiliate. The Plan, the Grant Agreement and other incidental communication materials have not been prepared in accordance with and are not intended to constitute a “prospectus” for a public offering of securities under the applicable securities legislation in Hong Kong. The RSUs are intended only for the personal use of each eligible employee of the Company or any Subsidiary or Affiliate and may not be distributed to any other person.
Sale Restriction
Any Shares
received at vesting are accepted as a personal investment. Notwithstanding anything contrary in the Grant Agreement or the Plan, in the event the RSUs vest and Shares are issued to the Employee or his or her legal representatives or estate within six months of the Grant Date, the Employee agrees that the Employee or his or her legal representatives or estate will not offer to the public or otherwise dispose of any Shares acquired prior to the six-month anniversary of the Grant Date.
Payout of RSUs in Shares Only
Pursuant to its discretion under Section 2(ii) of the Plan,
with respect to all Employees residing in Hong Kong, the Company will convert all vested RSUs only into an equivalent number of Shares. The Employees residing in Hong Kong (or in the event of death, the Employee’s legal representative or estate) will not receive an equivalent cash payment with respect to vested RSUs.
14
Nature of Scheme
The Company specifically intends that the Plan will not be an occupational retirement scheme for purposes of the Occupational Retirement Schemes Ordinance.
HUNGARY
Payout of RSUs in Cash Only
Pursuant to the Company’s discretion under Section 2(ii) of the Plan and notwithstanding the language in Section 3 of the Grant Agreement, due to legal considerations in Hungary, the RSUs granted to Employees in Hungary shall be settled in cash only (less any Tax-Related Items or other withholding obligations set forth in Section 11 of the Grant Agreement in accordance with Applicable Law and/or fees) and do not provide any right for the Employee to receive Shares.
INDIA
Exchange Control Notice
The Employee understands that he or she must repatriate to India any proceeds from the sale of Shares acquired under the Plan and any dividend equivalent payment within 90 days of receipt, and any cash dividends within 180 days of receipt. The Employee will receive a foreign inward remittance certificate (“FIRC”) from the bank where the Employee deposits the foreign currency. The Employee should maintain the FIRC as evidence of the repatriation of funds in the event the Reserve Bank of India or the Employer requests proof of repatriation.
Foreign Asset/Account Reporting Notice
Indian residents are required to declare any foreign bank accounts and any foreign financial assets (including Shares held outside of India) in their annual tax return. Indian residents should consult with their personal tax advisor to determine their personal reporting obligations.
INDONESIA
Exchange Control Notice
Indonesian residents must provide the Bank of Indonesia with information on foreign exchange activities on an online monthly report no later than the fifteenth day of the following month of the activity. In addition, if the Employee remits funds into Indonesia (e.g., proceeds from the sale of Shares), the Indonesian bank through which the transaction is made will submit a report of the transaction to the Bank of Indonesia for statistical reporting purposes. For transactions of US$10,000 or more, a more detailed description of the transaction must be included in the report and the Employee may be required to provide information about the transaction (e.g., the relationship between the Employee and the transferor of the funds, the source of the funds, etc.) to the bank in order for the bank to complete the report.
IRELAND
Director Reporting Notice
If the Employee is a director, shadow director(1) or secretary of an Irish Subsidiary or Affiliate whose interests meet or exceed 1% of the Company’s voting rights, pursuant to Section 53 of the Irish Company Act 1990, the Employee must notify the Irish Subsidiary or Affiliate in writing within five business days of receiving or disposing of an interest in the Company (e.g
.
, RSUs, Shares, etc.), or within five business days of becoming aware of the event giving rise to the notification requirement, or within five business days of becoming a director, shadow director or secretary if such an interest exists at that time. This notification requirement also applies with respect to the interests of a spouse or minor children, whose interests will be attributed to the director, shadow director or secretary.
ISRAEL
Israeli Sub-Plan
The RSUs are granted to the Employee pursuant to the Israeli Sub-Plan to the HP Inc. Second Amended and Restated 2004 Stock Incentive Plan (the “Israeli Sub-Plan”), and are subject to the terms and conditions stated in the Israeli Sub-Plan, the Plan and the Grant Agreement, including this Appendix. By accepting the RSUs, the Employee acknowledges and agrees to be bound by the terms of the Israeli Sub-Plan. The Israeli Sub-Plan is incorporated herein by reference and references to the Plan include the Israeli Sub-Plan.
The RSUs and Shares issued upon vesting of such RSUs are intended to qualify for the tax treatment available in Israel pursuant to the provisions of the “capital gain route” under Section 102 of the Israeli Tax Ordinance (“Section 102”), including the provisions of the Income Tax (Tax Abatement on the Grant of Shares to Employees) Regulations 2003 (the “Regulations”), and any tax ruling or
(1) A shadow director is an individual who is not on the board of directors of the Company or the Irish Subsidiary or Affiliate but who has sufficient control so that the board of directors of the Company or the Irish Subsidiary or Affiliate, as applicable, acts in accordance with the directions and instructions of the individual.
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agreement obtained by the Company or the Employer with regard to the Plan. It is clarified that in order to qualify for the “capital gains route,” the RSUs may be settled only in Shares.
Custody of RSUs
The following provisions replace Section 5 of the Grant Agreement:
5.
Custody of Restricted Stock Units.
(a) The RSUs subject hereto shall be held in trust by Tamir Fishman, as trustee (the “Trustee”) and further recorded in a restricted book entry account in the name of the Employee. Each RSU will be deemed granted on the date stated above, provided that (i) the Company has provided a copy of this Agreement to the Trustee and (ii) the Employee has signed all documents required pursuant to Applicable Law and under the Plan. Upon completion of the Restriction Period, Shares issued pursuant to Section 3 above shall be deposited with the Trustee (as further detailed below) in lieu of the RSUs previously held by the Trustee; provided, however, that a portion of such Shares may be surrendered in payment of any Tax-Related in accordance with Section 11 of this Grant Agreement, unless the Company, in its sole discretion, establishes alternative procedures for the payment of such taxes.
(b) Without derogating from the above, the Shares shall further be held in accordance with the undertakings of the Company and the Trustee, under a Trust Agreement in accordance with Section 102(b)(2) of the Israeli Tax Ordinance. Under the conditions of Section 102(b)(2), the RSUs and the Shares may be issued to the Employee only through the Trustee. To receive the tax treatment provided for in Section 102(b)(2), the RSUs and the Shares must be issued to the Trustee for a period of no less than 24 months from their Grant Date and deposit with the Trustee (the “Lock-Up Period”). In order for the tax benefits of Section 102(b)(2) to apply, as long as the RSUs are held by the Trustee, the RSUs or the underlying Shares may not be sold, transferred, assigned, pledged or mortgaged (other than through a transfer by will or by operation of law), nor may they be the subject of an attachment or security interest, and no power of attorney or transfer deed shall be given in respect thereof prior to the payment of the tax liability. Upon the conclusion of the Lock-Up Period the Trustee may release the Shares issued hereunder to the Employee only after (i) the receipt by the Trustee of an acknowledgment from the Israeli Income Tax Authority that the Employee has paid all applicable tax due pursuant to the Israeli Tax Ordinance and Section 102, or (ii) the Trustee withholds any applicable tax due pursuant to the Israeli Tax Ordinance and Section 102. Notwithstanding the foregoing, in the event the Employee shall elect to release the Shares prior to the conclusion of the Lock-up Period, the sanctions under Section 102 shall apply to and shall be borne solely by the Employee.
(c) The Employee understands that in the event of a distribution of rights, including an issuance of stock dividend or bonus shares, in connection with the RSU (the “Additional Rights”), all such Additional Rights shall be deposited with and/or issued to the Trustee for the benefit of the Employee, and shall also be subject to the provisions of Section 102(b)(2). The Lock-Up Period for such Additional Rights shall be measured from the commencement of the Lock-Up Period of the RSU to be issued hereunder, from which the Additional Rights were declared or distributed.
Death of the Employee
The following provision supplements Section 9 of the Grant Agreement:
As long as the Shares are held by the Trustee for the benefit of the Employee, all rights of the Employee over the Shares cannot be transferred, assigned, pledged or mortgaged, other than by will or laws of descent and distribution.
*
*
*
*
*
TO BE SIGNED BY THE ISRAELI EMPLOYEE WITH A COPY RETURNED TO PAYROLL ADMINISTRATION:
I have read and understood this Grant Agreement, including this Appendix. I understand that the rights granted and the Shares issued to me under this Grant Agreement are subject to the terms and provisions of Section 102(b)(2) of the Israeli Tax Ordinance and its related rules and regulations and I hereby accept such rights and Shares subject to such terms and provisions. I acknowledge that my holding, sale and transfer of the Shares and/or any Additional Rights is therefore subject to various restrictions and limitations that are imposed by such Section and its related rules and regulations, of which I am aware and with which I agree to comply.
ITALY
Plan Document Acknowledgment
The Employee acknowledges having read and specifically and expressly approves the following sections of the Grant Agreement: Section 2 (“Vesting Schedule”), Section 4 (“Restrictions”), Section 5 (“Custody of Restricted Stock Units”), Section 11 (“Taxes”), Section 13 (“Plan Information”), Section 14 (“Acknowledgment and Waiver”), Section 15 (“No Advice Regarding Grant”), Section 17(k) and (l) (“Notices”), Section 17(d) (“Language”), Section 17(i) (“Appendix), Section 17(j) (“Imposition of Other Requirements”) and the Data Privacy Notice below.
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Data Privacy Notice
Notwithstanding Section 12 or any other provision of the Grant Agreement, the Employee agrees that the following shall apply with regard to data privacy in Italy:
The Employee understands that the Employer, the Company and any of its other Subsidiaries and Affiliates may collect, use, transfer and hold certain personal information about the Employee, including, the Employee’s name, home address and telephone number, date of birth, social insurance number or other identification number, salary, nationality, job title, any Shares or directorships held in the Company, details of the award of RSUs or any other entitlement to Shares awarded, canceled, exercised, vested, unvested or outstanding in the Employee’s favor (“Data”), for the exclusive purpose of managing and administering the Plan.
The Employee also understands that providing the Company with the Data is necessary for the performance of the Plan and without such Data it would be impossible for the Company to perform its contractual obligations and may affect the Employee’s ability to participate in the Plan. The Controller of personal data processing is HP Inc., with registered offices at 1501 Page Mill, Palo Alto, California 94304, USA, and, pursuant to Legislative Decree no. 196/2003, its representative in Italy is
[Insert Name of Italian Representative Entity]
with registered offices at [Insert Address]. The Employee understands that Data will not be publicized, but it may be transferred to Merrill Lynch or other third parties, banks, other financial institutions or brokers involved in the management and administration of the Plan. The Employee further understands that the Company and/or its Subsidiaries and Affiliates will transfer Data amongst themselves as necessary for the purpose of implementation, administration and management of the Employee’s participation in the Plan, and that the Company and/or its Subsidiaries and Affiliates may each further transfer Data to third parties assisting the Company in the implementation, administration and management of the Plan, including any requisite transfer to Merrill Lynch or another third party with whom the Employee may elect to deposit any Shares acquired under the Plan. Such recipients may receive, possess, use, retain and transfer the Data in electronic or other form, for the purposes of implementing, administering and managing the Employee’s participation in the Plan. The Employee understands that these recipients may be located in the European Economic Area, or elsewhere, such as the U.S. or Asia. Should the Company exercise its discretion in suspending all necessary legal obligations connected with the management and administration of the Plan, it will delete Data as soon as it has accomplished all the necessary legal obligations connected with the management and administration of the Plan.
The Employee understands that Data processing related to the purposes specified above shall take place under automated or non-automated conditions, anonymously when possible, that comply with the purposes for which Data are collected and with confidentiality and security provisions as set forth by Applicable Laws and regulations, with specific reference to Legislative Decree no. 196/2003.
The processing activity, including communication, the transfer of Data abroad, including outside of the European Union, as herein specified and pursuant to Applicable Laws and regulations, does not require the Employee’s consent thereto as the processing is necessary to performance of contractual obligations related to implementation, administration and management of the Plan. The Employee understands that, pursuant to Section 7 of the Legislative Decree no. 196/2003, the Employee has the right to, including but not limited to, access, delete, update, ask for rectification of Data and estop, for legitimate reasons, the Data processing. Furthermore, the Employee is aware that Data will not be used for direct marketing purposes. In addition, the Data provided can be reviewed and questions or complaints can be addressed by contacting the Employee’s local human resources department.
Foreign Asset / Account Tax Reporting Notice
Italian residents who, at any time during the fiscal year, hold foreign financial assets (such as cash, Shares) which may generate income taxable in Italy are required to report such assets on their annual tax returns or on a special form if no tax return is due. The same reporting duties apply to Italian residents who are beneficial owners of the foreign financial assets pursuant to Italian money laundering provisions, even if they do not directly hold the foreign asset abroad. The Employee is advised to consult his or her personal legal advisor to ensure compliance with applicable reporting requirements.
Foreign Asset Tax Information
The value of the financial assets held outside of Italy by Italian residents is subject to a foreign asset tax. The taxable amount will be the fair market value of the financial assets (
e.g.
, Shares) assessed at the end of the calendar year.
JAPAN
Foreign Asset/Account Reporting Notice
The Employee will be required to report details of any assets held outside of Japan as of December 31 (including any Shares acquired under the Plan) to the extent such assets have a total net fair market value exceeding ¥50,000,000. Such report will be due by March 15 each year. The Employee should consult with his or her personal tax advisor as to whether the reporting obligation applies to the Employee and whether the Employee will be required to report details of any outstanding RSUs, Shares or cash held by the Employee in the report.
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KAZAKHSTAN
Securities Law Notice
.
This offer is addressed only to certain eligible employees resident in Kazakhstan with resect to rights to Shares or their cash equivalent). As of the date hereof, the Shares on the New York Stock Exchange under the ticker symbol “HPQ.” The Grant Agreement has not been approved, nor does it need to be approved, by the National Bank of Kazakhstan. The Grant Agreement is intended only for the Employee and is not for general circulation in the Republic of Kazakhstan
Payout of RSUs in Cash Only
Pursuant to the Company’s discretion under Section 2(ii) of the Plan and notwithstanding the language in Section 3 of the Grant Agreement, due to legal considerations in Kazakhstan, the RSUs granted to Employees in Kazakhstan shall be settled in cash only (less any Tax-Related Items and/or fees) and do not provide any right for the Employee to receive Shares.
Exchange Control Notice
No exchange formalities should apply to the Employee’s participation in the Plan as no consideration will be paid for the RSUs. However, prior to the RSUs vesting the Employee should confirm his or her applicable exchange control obligations with his or her personal advisor.
KENYA
There are no country-specific provisions.
KOREA
Exchange Control Notice
If the Employee receives US$500,000 or more from the sale of Shares or the receipt of dividends or dividend equivalent payments in a single transaction, Korean exchange control laws require the Employee repatriate the proceeds to Korea within 18 months of receipt.
Foreign Asset/Account Reporting Notice
Korean residents must declare all foreign financial accounts (e.g., non-Korean bank accounts, brokerage accounts) based in foreign countries to the Korean tax authority and file a report with respect to such accounts if the value of such accounts exceeds KRW 1 billion (or an equivalent amount in foreign currency).
The Employee should consult with his or her personal tax advisor for additional information about this reporting obligation.
KUWAIT
Securities Law Notice
The Plan does not constitute the marketing or offering of securities in Kuwait pursuant to Law No. 7 of 2010 (establishing the Capital Markets Authority) and its implementing regulations. Offerings under the Plan are being made only to eligible employees of the Company or any Subsidiary or Affiliate.
LATVIA
There are no country-specific provisions.
LEBANON
Securities Law Notification
This Plan does not constitute the marketing or offering of securities in Lebanon pursuant to Law No. 161 (2011), the Capital Markets Law. Offerings under the Plan are being made only to eligible employees of the Company or any Subsidiary or Affiliate.
LITHUANIA
There are no country-specific provisions.
LUXEMBOURG
There are no country-specific provisions.
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MACEDONIA
There are no country-specific provisions.
MALAYSIA
Data Privacy Consent
The following provision supplements Section 12 of the Grant Agreement:
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You hereby explicitly and unambiguously consent to the collection, use and transfer, in electronic or other form, of your personal information as described in this Agreement by and among, as applicable, the Employer, and the Company and its other Subsidiaries and Affiliates for the exclusive purpose of implementing, administering and managing your participation in the Plan.
You understand that the Company and the Employer may hold certain personal information about you, including, but not limited to, your name, home address and telephone number, date of birth, social insurance number (or any other social or national identification number), salary, nationality, job title, residency status, any Shares or directorships held in the Company, details of all Restricted Stock Units or any other entitlement to Shares awarded, canceled, exercised, vested, unvested or outstanding (the “Data”) for the purpose of implementing, administering and managing your participation in the Plan. The Data is supplied by the Employer and also by me through information collected in connection with the Agreement and the Plan.
You understand that the Data may be transferred to the Company or any of its Subsidiaries or Affiliates, or to any third parties assisting in the implementation, administration and management of the Plan, that these recipients may be located in your country or elsewhere, including outside the European Economic Area, and that the recipient’s country (e.g., the United States) may have different data privacy laws and protections than your country. You understand that you may request a list with the names and addresses of any potential recipients of the Data by contacting your local human resources representative.
You authorize the recipients to receive, possess, use, retain and transfer the Data, in electronic or other form, for the sole purposes of implementing, administering and managing your participation in the Plan, including any requisite transfer of such Data to a broker or other third party assisting with the administration of the RSUs under the Plan or with whom Shares acquired pursuant to RSUs or cash from the sale of such Shares may be deposited. Furthermore, you acknowledge and understand that the transfer of the Data to the Company or any of its subsidiaries or Affiliates, or to any third parties is necessary for your participation in the Plan.
You understand that the Data will be held only as long as is necessary to implement, administer and manage your participation in the Plan. You understand that you may, at any time, view the Data,
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Saya dengan ini secara eksplisit dan tanpa sebarang keraguan mengizinkan pengumpulan, penggunaan dan pemindahan, dalam bentuk elektronik atau lain-lain, data peribadi saya seperti yang diterangkan dalam Perjanjian oleh dan di antara, seperti mana yang terpakai, Majikan, Syarikat dan Syarikat Gabungan Korporat dan syarikat gabungannya untuk tujuan ekslusif bagi melaksanakan, mentadbir dan menguruskan penyertaan saya dalam Pelan.
Saya memahami bahawa Syarikat dan Majikan mungkin memegang maklumat peribadi tertentu tentang saya, termasuk, tetapi tidak terhad kepada, nama saya, alamat rumah dan nombor telefon, tarikh lahir, nombor insurans sosial atau nombor pengenalan lain, gaji, kewarganegaraan, jawatan, status kependudukan, apa-apa syer dalam Saham Biasa atau jawatan pengarah yang dipegang dalam Syarikat, bilangan syer dalam Saham Biasa yang dibeli di bawah Pelan, butir-butir semua hak pembelian atau apa-apa hak lain atas syer dalam Saham Biasa yang dianugerahkan, dibatalkan, dilaksanakan, terletak hak, tidak diletak hak ataupun yang belum dijelaskan bagi faedah saya(“Data”), untuk tujuan eksklusif bagi melaksanakan, mentadbir dan menguruskan Pelan tersebut. Data tersebut dibekalkan oleh Majikan dan juga oleh saya melalui maklumat yang dikumpul berkenaan dengan Perjanjian dan Pelan.
Saya memahami bahawa Data ini akan dipindahkan kepada mana-mana pihak ketiga yang membantu dengan pelaksanaan, pentadbiran dan pengurusan Pelan. Saya memahami bahawa penerima-penerima Data mungkin berada dalam negara saya atau mana-mana tempat lain, dan bahawa negara penerima (contohnya, Amerika Syarikat) mungkin mempunyai undang-undang privasi data dan perlindungan yang berbeza daripada negara saya. Saya memahami bahawa saya boleh meminta satu senarai yang mengandungi nama dan alamat penerima-penerima Data yang berpotensi dengan menghubungi wakil sumber manusia tempatan.
Saya memberi kuasa kepada penerima-penerima tersebut untuk menerima, memiliki, menggunakan, mengekalkan dan memindahkan Data, dalam bentuk elektronik atau lain-lain, semata-mata dengan tujuan untuk melaksanakan, mentadbir dan menguruskan penyertaan saya dalam Pelan, termasuklah apa-apa pemindahan yang diperlukan untuk Data tersebut sebagaimana yang diperlukan oleh broker atau mana-mana pihak ketiga yang membantu untuk melaksanakan hak pembelian saya di bawah Pelan atau dengan sesiapa syer Saham Biasa yang diperoleh di atas pelaksanaan hak pembelian ini atau wang tunai daripada penjualan saham tersebut boleh didepositkan. Saya memahami bahawa Data hanya akan disimpan untuk tempoh yang perlu bagi melaksanakan, mentadbir, dan menguruskan
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request additional information about the storage and processing of the Data, require any necessary amendments to the Data or refuse or withdraw the consents herein by contacting your local human resources representative in writing. Further, you understand that you are providing the consents herein on a purely voluntary basis. If you do not consent, or if you later seek to revoke your consent, your employment status or service and career with the Employer will not be affected; the only adverse consequence of refusing or withdrawing your consent is that the Company would not be able to grant RSUs or other equity awards to you, or administer or maintain such awards. Therefore, you understand that refusing or withdrawing your consent may affect your ability to vest in or realize benefits from RSUs and your ability to participate in the Plan. For more information on the consequences of your refusal to consent or withdrawal of consent, you understand that you may contact your local human resources representative.
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penyertaan saya dalam Pelan. Saya memahami bahawa saya boleh, pada bila-bila masa, melihat Data, meminta maklumat tambahan mengenai penyimpanan dan pemprosesan Data, meminta bahawa pindaan-pindaan dilaksanakan ke atas Data atau menolak atau menarik balik persetujuan dalam ini, dalam mana-mana kes, tanpa kos, dengan menghubungi secara bertulis wakil sumber manusia tempatan. Selanjutnya, saya memahami bahawa saya memberikan persetujuan di sini secara sukarela. Jika saya tidak bersetuju, atau jika saya kemudian membatalkan persetujuan saya, status pekerjaan atau perkhidmatan dan kerjaya saya dengan Majikan tidak akan terjejas; satu-satunya akibat buruk jika saya tidak bersetuju atau menarik balik persetujuan saya adalah bahawa Syarikat tidak akan dapat memberikan hak pembelian di bawah Pelan atau anugerah-anugerah ekuiti yang lain kepada saya atau mentadbir atau mengekalkan anugerah tersebut. Oleh itu, saya memahami bahawa keengganan atau penarikan balik persetujuan saya boleh menjejaskan keupayaan saya untuk mengambil bahagian dalam Pelan. Untuk maklumat lanjut mengenai akibat keengganan saya untuk memberikan keizinan atau penarikan balik keizinan, saya memahami bahawa saya boleh menghubungi wakil sumber manusia tempatan.
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Director Reporting Notice
If the Employee is a director of a Malaysian Subsidiary or Affiliate, the Employee is subject to certain notification requirements under the Malaysian Companies Act 1965. Among these requirements is an obligation to notify the Malaysian Subsidiary or Affiliate in writing when the Employee receives or disposes of an interest (
e.g
., RSUs or Shares) in the Company or any related company. This notification must be made within 14 days of receiving or disposing of any interest in the Company or any related company.
MALTA
Payout of RSUs in Cash Only
Pursuant to the Company’s discretion under Section 2(ii) of the Plan and notwithstanding the language in Section 3 of the Grant Agreement, due to legal considerations in Malta, the RSUs granted to Employees in Malta shall be settled in cash only (less any Tax-Related Items and/or fees) and do not provide any right for the Employee to receive Shares.
Securities Law Notice
The Plan, the Grant Agreement (including this Appendix) and all other materials the Employee may receive regarding participation in the Plan do not constitute advertising of securities in Malta and are deemed accepted by the Employee upon receipt of the Employee’s electronic or written acceptance in the United States. The issuance of Shares under the Plan has not and will not be registered in Malta and, therefore, the Shares described in any Plan documents may not be offered or placed in public circulation in Malta.
In no event will Shares issued upon settlement of the RSUs be delivered to the Employee in Malta. All Shares issued upon settlement of the RSUs will be maintained on the Employee’s behalf in the United States.
MAURITIUS
There are no country-specific provisions.
MEXICO
The following provisions supplement Section 14 of the Grant Agreement:
Labor Law Acknowledgment
By accepting the RSUs, the Employee acknowledges that he or she understands and agrees that:
(i) the RSUs are not related to the salary and other contractual benefits granted to the Employee by the Employer; and (ii) any modification of the Plan or its termination shall not constitute a change or impairment of the terms and conditions of employment.
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Policy Statement
The invitation the Company is making under the Plan is unilateral and discretionary and, therefore, the Company reserves the absolute right to amend it and discontinue it at any time without any liability to the Employee.
The Company, with its registered office at 1501 Page Mill, Palo Alto, California 94304, USA., is solely responsible for the administration of the Plan. Participation in the Plan and the acquisition of Shares does not, in any way, establish an employment relationship between the Employee and the Company since the Employee is participating in the Plan on a wholly commercial basis and the sole employer is the Employer, nor does it establish any rights between the Employee and Employer.
Plan Document Acknowledgment
By accepting the
RSUs, the Employee acknowledges he/she has received a copy of the Plan, has reviewed the Plan and the Grant Agreement in their entirety and fully understands and accepts all provisions of the Plan and the Grant Agreement.
In addition, by signing below, the Employee further acknowledges that having read and specifically and expressly approved the terms and conditions in Section 14 of the
Grant Agreement, in which the following is clearly described and established: (i) participation in the Plan does not constitute an acquired right; (ii) the Plan and participation in the Plan is offered by the Company on a wholly discretionary basis; (iii) participation in the Plan is voluntary; and (iv) the Company, its Subsidiaries and its Affiliates are not responsible for any decrease in the value of the Shares underlying the RSUs.
Finally, the Employee does not reserve any action or right to bring any claim against the Company for any compensation or damages as a result of participation in the Plan and the Employee therefore grants a full and broad release to his/her Employer and the Company and its other Subsidiaries and Affiliates with respect to any claim that may arise under the Plan.
Spanish Translation
Las siguientes disposiciones complementan la Sección 14 del Acuerdo de Otorgamiento:
Reconocimiento de la Ley Laboral
Al aceptar las Unidades de Acciones, el Empleado reconoce que entiende y acepta que:
(i) las Unidades de Acciones no se encuentran relacionadas con el salario ni con otras prestaciones contractuales concedidas al Empleado por parte del Empleador; y (ii) cualquier modificación del Plan o su terminación no constituye un cambio o desmejora de los términos y condiciones de empleo.
Declaración de Política
La invitación por parte de la Compañía bajo el Plan, es unilateral y discrecional; por lo tanto, la Compañía se reserva el derecho absoluto de modificar el mismo y discontinuarlo en cualquier tiempo, sin ninguna responsabilidad para el Empleado.
La Compañía, con oficinas registradas ubicadas en
1501 Page Mill, Palo Alto, California 94304, USA
es la única responsable de la administración del Plan y de la participación en el mismo y la adquisición de Acciones Comunes no establece de forma alguna, una relación de trabajo entre el Empleado y la Compañía, ya que la participación del Empleado en el Plan es completamente comercial y el único empleador es el Empleador, así como tampoco establece ningún derecho entre el Empleado y su Empleador.
Reconocimiento del Documento del Plan
Por medio de la aceptación las Unidades de Acciones, el Empleado reconoce que ha recibido una copia del Plan, que el mismo ha sido revisado al igual que la totalidad del Acuerdo de Otorgamiento y, que ha entendido y aceptado completamente todas las disposiciones contenidas en el Pan y en el Acuerdo de Otorgamiento.
Adicionalmente, al firmar abajo, el Empleado reconoce que ha leído, y que aprueba específica y expresamente los términos y condiciones contenidos en la Sección 14 del Acuerdo, en la cual se encuentra claramente descrito y establecido que: (i) la participación en el Plan no constituye un derecho adquirido; (ii) el Plan y la participación en el mismo es ofrecida por la Compañía de forma enteramente discrecional; (iii) la participación en el Plan es voluntaria; y (iv) la Compañía, así como sus Subsidiarias y Afiliadas no son responsables por cualquier detrimento en el valor de las Acciones Comunes en relación con las Unidades de Acciones.
Finalmente, el Empleado declara que no se reserva ninguna acción o derecho para interponer una demanda en contra de la Compañía por compensación, daño o perjuicio alguno como resultado de su participación en el Plan y en consecuencia, otorga el más amplio finiquito a su Empleador, así como a la Compañía, a sus otras Subsidiarias y Afiliadas con respecto a cualquier demanda que pudiera originarse en virtud del Plan.
MOROCCO
Payout of RSUs in Cash Only
Pursuant to the Company’s discretion under Section 2(ii) of the Plan and notwithstanding the language in Section 3 of the Grant Agreement, due to legal considerations in Morocco, the RSUs granted to Employees in Morocco shall be settled in cash only through local payroll (less any Tax-Related Items and/or fees) and do not provide any right for the Employee to receive Shares.
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NETHERLANDS
Notifications
Securities Law Information
Attention! This investment falls outside AFM supervision. No prospectus required for this activity.
NEW ZEALAND
There are no country-specific provisions.
NIGERIA
There are no country-specific provisions.
NORWAY
There are no country-specific provisions.
PAKISTAN
Exchange Control Notice
The Employee is required immediately to repatriate to Pakistan the proceeds from the sale of Shares or the receipt of any dividends or dividend equivalent payments. The proceeds must be converted into local currency and the receipt of proceeds must be reported to the State Bank of Pakistan (the “SBP”) by filing a “Proceeds Realization Certificate” issued by the bank converting the proceeds with the SBP. The repatriated amounts cannot be credited to a foreign currency account. The Employee should consult his or her personal advisor prior to vesting and settlement of the RSUs to ensure compliance with the applicable exchange control regulations in Pakistan, as such regulations are subject to frequent change. The Employee is responsible for ensuring compliance with all exchange control laws in Pakistan.
PANAMA
Securities Law Notice
Neither the RSUs nor the Shares that the Employee may acquire under the Plan constitute a public offering of securities, as they are available only to eligible employees of the Company, its Affiliates and its Subsidiaries.
PERU
Securities Law Notice
The grant of RSUs is considered a private offering in Peru; therefore, it is not subject to registration.
Labor Law Acknowledgment
The following provision supplements Section 14 of the Grant Agreement:
By accepting the RSUs, the Employee acknowledges, understands and agrees that the RSUs are being granted
ex gratia
to the Employee with the purpose of rewarding him or her.
PHILIPPINES
Issuance of Shares of Common Stock
Employee acknowledges, understands and agrees that, if the issuance of Shares on the vesting date does not comply with all applicable Philippines securities laws, Shares will not be issued. In particular, Shares will not be issued unless and until the Philippines Securities and Exchange Commission authorizes the issuance of Shares under the Plan by approving the Company’s request for exemption from the securities registration requirement.
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Securities Law Notice
The Employee is permitted to dispose or sell Shares acquired under the Plan provided the offer and resale of the Shares takes place outside of the Philippines through the facilities of a stock exchange on which the Shares listed. The Shares are currently listed on the New York Stock Exchange in the United States under the ticker symbol “HPQ.”.
POLAND
Exchange Control Notice
If the Employee holds foreign securities (including Shares) and maintains accounts abroad, the Employee may be required to file certain reports with the National Bank of Poland. Specifically, if the value of securities and cash held in such foreign accounts exceeds PLN 7 million, the Employee must file reports on the transactions and balances of the accounts on a quarterly basis. Further, any fund transfers into or out of Poland in excess of €15,000 must be effected through a bank in Poland. Polish residents are required to store all documents related to foreign exchange transactions for a period of five years.
PORTUGAL
Exchange Control Notice
If the Employee holds Shares upon vesting of the RSUs, the acquisition of Shares should be reported to the Banco de Portugal for statistical purposes. If the Shares are deposited with a commercial bank or financial intermediary in Portugal, such bank or financial intermediary will submit the report on the Employee’s behalf. If the Shares are not deposited with a commercial bank or financial intermediary in Portugal, the Employee is responsible for submitting the report to the Banco de Portugal.
Language Consent
The Employee hereby expressly declares that he or she has full knowledge of the English language and has read, understood and fully accepted and agreed with the terms and conditions established in the Plan and Grant Agreement.
Consentimento sobre Língua
O Empregado Contratado, pelo presente instrumento, declara expressamente que domina a língua inglesa e que leu, compreendeu e livremente aceitou e concordou com os termos e condições estabelecidos no Plano e no Acordo de Atribuição.
PUERTO RICO
There are no country-specific provisions.
QATAR
There are no country-specific provisions.
ROMANIA
Exchange Control Notice
If the Employee deposits the proceeds from the sale of Shares issued to him or her at vesting and settlement of the Shares or any cash dividends or dividend equivalent payments in a bank account in Romania, the Employee may be required to provide the Romanian bank with appropriate documentation explaining the source of the funds.
The Employee should consult his or her personal advisor to determine whether the Employee will be required to submit such documentation to the Romanian bank.
RUSSIA
Payout of RSUs in Cash Only
Pursuant to the Company’s discretion under Section 2(ii) of the Plan and notwithstanding the language in Section 3 of the Grant Agreement, the RSUs granted to Employees in Russia shall be settled in cash only paid through local payroll (less any Tax-Related Items and/or fees) and do not provide any right for the Employee to receive Shares.
Compliance with Laws and Regulations
This provision supplements Section 14 of the Grant Agreement:
By accepting this grant of RSUs, the Employee understands, acknowledges and agrees that:
(a)
To participate in the Plan, Employee must comply with all Applicable Laws and regulations in Russia.
23
(b)
A copy of this Grant Agreement has been sent to the Employee by the Company as an offer from the territory of the United States of America and by agreeing to accept the RSUs, this Grant Agreement shall be deemed to have been concluded at the location of the Company at the following address: 1501 Page Mill, Palo Alto, California, 94304, USA.
(c)
All actions and proceedings seeking to enforce any provision of, or based on any right arising out of, this Grant Agreement must be brought against either of the parties in the courts of the State of Delaware, County of New Castle, or, if it has or can acquire jurisdiction, in the United States District Court for the District of Delaware, and each of the parties consents to the exclusive jurisdiction of such courts (and of the appropriate appellate courts) in any such action or proceeding and waives any objection to venue laid therein.
(d)
The Employee will comply with the Russian foreign exchange legislation in force at the relevant time.
(e)
The Employee will be solely responsible for (i) the proper declaration of all income received in accordance with the Plan and (ii) the payment of all relevant Tax-Related Items in connection with the receipt of such income as required by applicable Russian law.
(f)
The Employee agrees to execute such further instruments and to take such other action as may be necessary to facilitate his or her participation in the Plan.
Data Privacy Acknowledgement
The Employee hereby acknowledges that he or she has read and understood the terms regarding collection, processing and transfer of Data contained in Section 12 of the Grant Agreement and by participating in the Plan, the Employee agrees to such terms. In this regard, upon request of the Company or the Employer, the Employee agrees to provide an executed data privacy consent form to the Employer or the Company (or any other agreements or consents that may be required by the Employer or the Company) that the Company and/or the Employer may deem necessary to obtain under the data privacy laws in the Employee’s country, either now or in the future. The Employee understands that he or she will not be able to participate in the Plan if the Employee fails to execute any such consent or agreement.
Exchange Control Notice
Under current exchange control regulations, within a reasonably short time after receiving any cash proceeds under the Plan,
the Employee must repatriate such amounts to Russia. Such cash proceeds must be initially credited to the Employee through a foreign currency account at an authorized bank in Russia. After the proceeds are initially received in Russia, they may be further remitted to foreign banks subject to the following limitations: (i) the foreign account may be opened only for individuals; (ii) the foreign account may not be used for business activities; and (iii) the Russian tax authorities must be given notice about the opening/ closing of each foreign account within one month of the account opening/closing. Effective August 2014, dividends (but not dividend equivalents) do not need to be remitted to the Employee’s bank account in Russia but may be remitted directly to a foreign individual bank account (in any Organisation for Economic Cooperation and Development or Financial Action Task Force countries).
The Employee is encouraged to contact his or her personal advisor before remitting proceeds from participation in the Plan to Russia as exchange control requirements may change.
Securities Law Notice
This Appendix, the Grant Agreement, the Plan and all other materials that the Employee may receive regarding participation in the Plan do not constitute advertising or an offering of securities in Russia. The issuance of securities pursuant to the Plan has not and will not be registered in Russia; hence, the securities described in any Plan-related documents may not be used for offering or public circulation in Russia.
SENEGAL
Tax Registration Notice
The Employee is required to submit a copy of this Grant Agreement to the tax authorities within one (1) month of date the RSUs are granted and to pay any applicable registration fee. It is the Employee’s responsibility to submit the registration and pay the fee.
SERBIA AND MONTENEGRO
Securities Law Notice
The grant of Stock Options is not subject to the regulations concerning public offers and private placements under the Law on Capital Markets.
Exchange Control Notice
Pursuant to the Law on Foreign Exchange Transactions, Serbian residents may freely acquire Shares under the Plan. However, the National Bank of Serbia generally requires residents to report the acquisition of Shares, the value of the Shares at vesting and, on a quarterly basis, any changes in the value of the underlying Shares. An exemption from this reporting obligation may apply on the basis that the Shares are acquired for no consideration. The Employee is advised to consult with his or her personal legal advisor to determine the Employee’s reporting obligations upon the acquisition of Shares under the Plan as such obligations are subject to change based on the interpretation of applicable regulations by the National Bank of Serbia.
24
SINGAPORE
Payout of RSUs in Cash Only for Mobile Employees
Pursuant to the Company’s discretion under Section 2(ii) of the Plan and notwithstanding the language in Section 3 of the Grant Agreement, if the Employee is designated by the Company as a mobile employee, the RSUs granted to Employees in Singapore shall be settled in cash only (less any Tax-Related Items and/or fees) and do not provide any right for the Employee to receive Shares.
Securities Law Notice
The grant of RSUs is being made to the Employee in reliance on the “Qualifying Person” exemption under section 273(1)(f) of the Singapore Securities and Futures Act (Chapter 289, 2006 Ed.) (“SFA”) and not being made with the view to the underlying Shares being subsequently offered for sale to any other party. The Plan has not been lodged or registered as a prospectus with the Monetary Authority of Singapore. The Employee should note that the RSUs are subject to section 257 of the SFA and the Employee should not make any subsequent sale directly to any person in Singapore, or any offer of such subsequent sale of the Shares underlying the RSUs, unless such sale or offer in Singapore is made (i) after six months from the Grant Date or (ii) pursuant to the exemptions under Part XIII Division (1) Subdivision (4) (other than section 280) of the SFA.
Chief Executive Officer and Director Reporting Notice
If the Employee is the Chief Executive Officer (“CEO”) or a director, associate director or shadow director of the Company’s Singapore Subsidiary or Affiliate, he or she is subject to certain notification requirements under the Singapore Companies Act. Among these requirements is an obligation to notify the Company’s Singapore Subsidiary or Affiliate in writing when the Employee receives an interest (
e.g.
, RSUs or Shares) in the Company or any Subsidiary or Affiliate. In addition, the Employee must notify the Company’s Singapore Subsidiary or Affiliate when he or she sells Shares (including when the Employee sells Shares issued upon vesting and settlement of the RSUs). These notifications must be made within two business days of acquiring or disposing of any interest in the Company or any Subsidiary or Affiliate. In addition, a notification of the Employee’s interests in the Company or any Subsidiary or Affiliate must be made within two business days of becoming the CEO or, director, associate director or shadow director.
SLOVAKIA
Foreign Asset/Account Reporting Notice
If the Employee
permanently resides in the Slovak Republic and, apart from being employed, carries on business activities as an independent entrepreneur (in Slovakian,
podnikatel
), the Employee will be obligated to report his or her foreign assets (including any foreign securities) to the National Bank of Slovakia (provided that the value of the foreign assets exceeds an amount of €2,000,000). These reports must be submitted on a monthly basis by the 15
th
day of the respective calendar month, as well as on a quarterly basis by the 15
th
day of the calendar month following the respective calendar quarter, using notification form DEV (NBS) 1-12, which may be found at the National Bank of Slovakia’s website at www.nbs.sk.
SLOVENIA
Foreign Asset/Account Reporting Information.
Slovenian residents may be required to report the opening of bank and/or brokerage accounts to tax authorities within 15 days of opening such account. The Employee should consult with his or her personal tax advisor to determine whether this requirement will be applicable to any accounts opened in connection with the Employee’s participation in the Plan (e.g., the Employee’s brokerage account with the Company’s designated broker).
SOUTH AFRICA
Payout of RSUs in Cash Only
Pursuant to the Company’s discretion under Section 2(ii) of the Plan and notwithstanding the language in Section 3 of the Grant Agreement, due to exchange control restrictions in South Africa, the RSUs granted to Employees in South Africa shall be settled in cash only (less any Tax-Related Items and/or fees) and do not provide any right for the Employee to receive Shares.
Exchange Control Notice
Because no transfer of funds from South Africa is required under the RSUs, no filing or reporting requirements should apply when the RSUs are granted or when a payment is received upon vesting and settlement of the RSUs. However, because the exchange control regulations are subject to change, the Employee should consult his or her personal advisor prior to vesting and settlement of the RSUs to ensure compliance with current regulations. The Employee is responsible for ensuring compliance with all exchange control laws in South Africa.
Tax Reporting Notice
By accepting the RSUs, the Employee agrees to notify the Employer of the amount of income realized at vesting of the RSUs. If the Employee fails to advise the Employer of the income at vesting, he or she may be liable for a fine. The Employee will be responsible for paying any difference between the actual tax liability and the amount withheld.
25
SPAIN
Acknowledgment and Waiver
The following provisions supplement Section 14 of the Grant Agreement:
By accepting the grant of RSUs, the Employee acknowledges that he or she consents to participation in the Plan and has received a copy of the Plan.
The Employee understands that the Company has unilaterally, gratuitously and discretionally decided to grant RSUs under the Plan to individuals who may be employees of the Company or its Subsidiaries or Affiliates throughout the world. The decision is a limited decision that is entered into upon the express assumption and condition that any grant will not economically or otherwise bind the Company or any of its Subsidiaries or Affiliates on an ongoing basis except as provided in the Plan. Consequently, the Employee understands that the RSUs are granted on the assumption and condition that the RSUs or the Shares acquired upon vesting shall not become a part of any employment contract (either with the Company or any of its Subsidiaries or Affiliates) and shall not be considered a mandatory benefit, salary for any purposes (including severance compensation) or any other right whatsoever. In addition, the Employee understands that this grant would not be made to the Employee but for the assumptions and conditions referred to above; thus, the Employee acknowledges and freely accepts that should any or all of the assumptions be mistaken or should any of the conditions not be met for any reason, then the RSUs shall be null and void.
The RSUs are a conditional right to Shares and can be forfeited in the case of, or affected by, the Employee’s termination of service or employment. This will be the case, for example, even if (1) the Employee is considered to be unfairly dismissed without good cause; (2) the Employee is dismissed for disciplinary or objective reasons or due to a collective dismissal; (3) the Employee terminates employment or service due to a change of work location, duties or any other employment or contractual condition; (4) the Employee terminates employment or service due to unilateral breach of contract of the Company, the Employer, or any other Subsidiary or Affiliate; or (5) the Employee’s employment or service terminates for any other reason whatsoever, except for reasons specified in the Grant Agreement. Consequently, upon termination of the Employee’s employment or service for any of the reasons set forth above, the Employee may automatically lose any rights to the unvested RSUs granted to him or her as of the date of the Employee’s termination of employment, as described in the Plan and the Grant Agreement.
Exchange Control Notice
The Employee must declare the acquisition of Shares to the
Dirección General de Comercial e Inversiones
(the “DGCI”) of the
Ministerio de Economia
for statistical purposes. The Employee must also declare ownership of any Shares by filing a D-6 form with the DGCI each January while the Shares are owned. In addition, if the Employee wishes to import the ownership title of any Shares (
i.e.,
share certificates) into Spain, he or she must declare the importation of such securities to the DGCI.
When receiving foreign currency payments derived from the RSUs or ownership of Shares (
i.e.
, cash dividends, dividend equivalent payments or sale proceeds) in excess of €50,000, the Employee must inform the financial institution receiving the payment of the basis upon which such payment is made. The Employee will need to provide the financial institution with the following information: (i) the Employee’s name, address and fiscal identification number; (ii) the name and corporate domicile of the Company; (iii) the amount of the payment; (iv) the currency used; (v) the country of origin; (vi) the reasons for the payment; and (vii) additional information that may be required.
The Employee is required to declare electronically to the Bank of Spain any securities accounts (including brokerage accounts held abroad), as well as the Shares held in such accounts if the value of the transactions during the prior tax year or the balances in such accounts as of December 31 of the prior tax year exceed €1,000,000.
Securities Law Notice
The grant of RSUs and the Shares issued pursuant to the vesting of the RSUs are considered a private placement outside of the scope of Spanish laws on public offerings and issuances of securities.
Foreign Asset/Account Reporting Notice
To the extent that the Employee holds Shares and/or has bank accounts outside Spain with a value in excess of €50,000 (for each type of asset) as of December 31, the Employee will be required to report information on such assets on his or her tax return (tax form 720) for such year. After such Shares and/or accounts are initially reported, the reporting obligation will apply for subsequent years only if the value of any previously-reported Shares or accounts increases by more than €20,000. The reporting must be completed by the following March 31.
SRI LANKA
Payout of RSUs in Cash Only
Pursuant to the Company’s discretion under Section 2(ii) of the Plan and notwithstanding the language in Section 3 of the Grant Agreement, due to legal considerations in Sri Lanka, the RSUs granted to Employees in Sri Lanka shall be settled in cash only through local payroll (less any Tax-Related Items and/or fees) and do not provide any right for the Employee to receive Shares.
26
Exchange Control Notice
If the Employee holds proceeds in a foreign cash account, the Employee will be required to obtain exchange control approval. The Employee is responsible for ensuring compliance with all exchange control laws in Sri Lanka.
SWEDEN
There are no country-specific provisions.
SWITZERLAND
Securities Law Notice
The offer of RSUs is not intended to be publicly offered in or from Switzerland. Because the offer of the RSUs is considered a private offering, it is not subject to registration in Switzerland. Neither this document nor any other materials relating to the RSUs constitutes a prospectus as such term is understood pursuant to article 652a of the Swiss Code of Obligations, and neither this document nor any other materials relating to the RSUs may be publicly distributed nor otherwise made publicly available in Switzerland.
TAIWAN
Data Privacy Consent
The Employee hereby acknowledges that he or she has read and understood the terms regarding collection, processing and transfer of Data contained in Section 12 of the Grant Agreement and by participating in the Plan, the Employee agrees to such terms. In this regard, upon request of the Company or the Employer, the Employee agrees to provide an executed data privacy consent form to the Employer or the Company (or any other agreements or consents that may be required by the Employer or the Company) that the Company and/or the Employer may deem necessary to obtain under the data privacy laws in the Employee’s country, either now or in the future. The Employee understands he or she will not be able to participate in the Plan if the Employee fails to execute any such consent or agreement.
Securities Law Notice
The RSUs and the Shares to be issued pursuant to the Plan are available only to employees of the Company, its Subsidiaries and Affiliates. The grant of the RSUs does not constitute a public offer of securities.
Exchange Control Notice
The Employee may acquire and remit foreign currency (including proceeds from the sale of Shares) into and out of Taiwan up to US$5,000,000 per year. If the transaction amount is TWD$500,000 or more in a single transaction, the Employee must submit a foreign exchange transaction form and also provide supporting documentation to the satisfaction of the remitting bank. If the transaction amount is US$500,000 or more in a single transaction, the Employee may be required to provide additional supporting documentation to the satisfaction of the remitting bank. The Employee should consult his or her personal advisor to ensure compliance with applicable exchange control laws in Taiwan.
THAILAND
Exchange Control Notice
When the Employee sells Shares issued upon vesting of the RSUs or receives dividends or dividend equivalent payments, the Employee must repatriate to Thailand any cash proceeds or payments of at least US$50,000 within 360 days from the date the sale transaction was entered into. The Employee must either convert the amounts to local currency or deposit the funds into a foreign currency account within 360 days of repatriation. If the amount of the Employee’s proceeds is US$50,000 or more, the Employee must specifically report the inward remittance to the Bank of Thailand on a foreign exchange transaction form. If the Employee fails to comply with these obligations, the Employee may be subject to penalties assessed by the Bank of Thailand. The Employee should consult his or her personal legal advisor prior to taking any action with respect to the remittance of proceeds into Thailand. The Employee is responsible for ensuring compliance with all exchange control laws in Thailand.
TUNISIA
Payout of RSUs in Cash Only
Pursuant to the Company’s discretion under Section 2(ii) of the Plan and notwithstanding the language in Section 3 of the Grant Agreement, due to legal considerations in Tunisia, the RSUs granted to Employees in Tunisia shall be settled in cash only through local payroll (less any Tax-Related Items and/or fees) and do not provide any right for the Employee to receive Shares.
Exchange Control Acknowledgement
If the Employee is a resident of Tunisia, he or she acknowledges, consents and agrees to comply with exchange control requirements with respect to the RSU and to obtain any necessary approval from the Central Bank of Tunisia. If the Employee holds assets (including Shares acquired under the Plan) outside Tunisia and the value of such assets exceeds a certain threshold (currently TND 500), the Employee must declare the assets to the Central Bank of Tunisia within six months of their acquisition. All proceeds from the
27
RSUs, the Shares and the sale of Shares must be repatriated to Tunisia. The Employee should consult his or her personal advisor before taking action with respect to remittance of proceeds into Tunisia.
TURKEY
Securities Law Notice
Under Turkish law, the Employee is not permitted to sell any Shares acquired under the Plan in Turkey. The Shares are currently traded on the New York Stock Exchange, which is located outside of Turkey, under the ticker symbol “HPQ” and Shares acquired under the Plan may be sold through this exchange.
Exchange Control Notice
Under Turkish law, Turkish residents are permitted to purchase and sell securities or derivatives traded on exchanges abroad only through a financial intermediary licensed in Turkey. Therefore, the Employee may be required to appoint a Turkish broker to assist the Employee with the sale of the Shares acquired under the Plan.
UKRAINE
Payout of RSUs in Cash Only
Pursuant to the Company’s discretion under Section 2(ii) of the Plan and notwithstanding the language in Section 3 of the Grant Agreement, due to exchange control restrictions in the Ukraine, the RSUs granted to Employees in the Ukraine shall be settled in cash only paid through local payroll (less any Tax-Related Items and/or fees) and do not provide any right for the Employee to receive Shares.
Exchange Control Notice
The Employee understands that the Employee is responsible for complying with applicable exchange control regulations in Ukraine. The Employee should consult a legal advisor regarding his or her participation in the Plan.
UNITED ARAB EMIRATES
Securities Law Notice
The Plan is being offered only to qualified employees and is in the nature of providing equity incentives to employees of the Company or its Subsidiary in the UAE. Any documents related to the Plan, including the Plan, this Appendix, the Plan prospectus and other grant documents (“Plan Documents”), are intended for distribution only to such employees and must not be delivered to, or relied on by any other person. Prospective recipients of the securities offered (i.e., the RSUs) should conduct their own due diligence on the securities.
The Emirates Securities and Commodities Authority has no responsibility for reviewing or verifying any Plan Documents nor has it taken steps to verify the information set out in them, and thus, is not responsible for such documents. Further, neither the Ministry of Economy nor the Dubai Department of Economic Development has approved this statement nor taken steps to verify the information set out in it, and has no responsibility for it.
Employees should, as prospective stockholders, conduct their own due diligence on the securities. If the Employee does not understand the contents of the Plan Documents, he or she should consult an authorized financial adviser.
UNITED KINGDOM
Payout of RSUs in Shares Only
Pursuant to its discretion under Section 2(ii) of the Plan,
with respect to all Employees residing in the United Kingdom, the Company will convert all vested RSUs only into an equivalent number of Shares. Employees residing in the United Kingdom (or in the event of death, such Employee’s legal representative) will not receive an equivalent cash payment with respect to vested RSUs.
UZBEKISTAN
Payout of RSUs in Cash Only
Pursuant to the Company’s discretion under Section 2(ii) of the Plan and notwithstanding the language in Section 3 of the Grant Agreement, due to exchange control restrictions in Uzbekistan, the RSUs granted to Employees in Uzbekistan shall be settled in cash only (less any Tax-Related Items and/or fees) and do not provide any right for the Employee to receive Shares.
Exchange Control Notice
All proceeds from the vesting of the RSUs are required to be repatriated to Uzbekistan via a U.S. dollar account at a Uzbek bank.
28
VENEZUELA
Investment Representation
As a condition of the grant of RSUs, the Employee acknowledges and agrees that any Shares the Employee may acquire upon the vesting of the RSUs are acquired as and intended to be an investment rather than for the resale of the Shares and conversion of Shares into foreign currency.
Securities Law Notice
The RSUs granted under the Plan and the Shares issued under the Plan are offered as a personal, private, exclusive transaction and are not subject to Venezuelan government securities regulations.
Exchange Control Notice
Exchange control restrictions may limit the ability to vest in the RSUs or to remit funds into Venezuela following the sale of Shares acquired under the Plan. The Company reserves the right to further restrict the settlement of the RSUs or to amend or cancel the RSUs at any time to comply with the applicable exchange control laws in Venezuela. However, ultimately, the Employee is responsible for complying with exchange control laws in Venezuela and neither the Company, the Employer nor any other Subsidiary or Affiliate will be liable for any fines or penalties resulting from the Employee’s failure to comply with Applicable Laws. Because exchange control laws and regulations change frequently and without notice, the Employee should consult with his or her personal legal advisor before accepting the RSUs to ensure compliance with current regulations.
VIETNAM
Payout of RSUs in Cash Only
Pursuant to the Company’s discretion under Section 2(ii) of the Plan and notwithstanding the language in Section 3 of the Grant Agreement, due to exchange control restrictions in Vietnam, the RSUs granted to Employees in Vietnam shall be settled in cash only paid through local payroll (less any Tax-Related Items and/or fees) and do not provide any right for the Employee to receive Shares.
HP INC.
Dion Weisler
CEO and President
Tracy Keogh
Chief Human Resources Officer
RETAIN THIS GRANT AGREEMENT FOR YOUR RECORDS
Important Note:
Your grant is subject to the terms and conditions of this Grant Agreement, including any Appendix for your country, and to the Company obtaining all necessary government approvals. If you have questions regarding your grant, please contact Stock Plan Administration.
29
Exhibit 10(r)(r)
GRANT AGREEMENT [for use from January 1, 2016]
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Grant Date:
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Grant ID:
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Amount:
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Plan:
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Vesting Schedule:
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Restricted Stock Units
THIS GRANT AGREEMENT, as of the Grant Date noted above between HP Inc., a Delaware Corporation (“Company”), and the employee named above (“Employee”), is entered into as follows:
WHEREAS, the continued participation of the Employee is considered by the Company to be important for the Company’s continued growth; and
WHEREAS, in order to give the Employee an incentive to continue in the employ of the Company (or its Affiliates or Subsidiaries), to accept ancillary agreements designed to protect the legitimate business interests of the Company that are made a condition of this grant and to participate in the affairs of the Company, the HR and Compensation Committee of the Board of Directors of the Company or its delegates (“Committee”) has determined that the Employee shall be granted restricted stock units representing hypothetical shares of the Company’s common stock (“RSUs”), with each RSU equal in value to one share of the Company’s $0.01 par value common stock (“Share”), subject to the restrictions stated below and in accordance with the terms and conditions of the plan named above (“Plan”), a copy of which can be found on the Long-term Incentives website along with a copy of the related prospectus. The Plan and the related prospectus also can be obtained by written or telephonic request to the Company Secretary. Unless otherwise defined in this Grant Agreement, any capitalized terms in this Grant Agreement shall have the meaning ascribed to such terms in the Plan.
THEREFORE, the parties agree as follows:
1.
Grant of Restricted Stock Units.
Subject to the terms and conditions of this Grant Agreement and of the Plan, the Company hereby grants to the Employee the number of RSUs set forth above.
2.
Vesting Schedule.
The interest of the Employee in the RSUs shall vest according to the vesting schedule set forth above, or if earlier, in accordance with Section 8 or 9, below, except to the extent a severance plan applicable to the Employee provides otherwise. Unless the provisions of Section 8 or 9 apply, the Employee must remain in the employ of the Company, any Subsidiary or Affiliate on a continuous basis through the close of business on the applicable Vesting Date, as set forth above
,
and the Employee must be in compliance with the requirements and conditions provided for in the Plan and this Grant Agreement for the interest of the Employee in the RSUs to become fully vested on that date.
3.
Benefit Upon Vesting.
Within 75 days of each Vesting Date set forth on the above vesting schedule or, if earlier, a vesting event pursuant to Section 8 or 9 below, the Company shall deliver or pay, as applicable, to the Employee (or the Employee’s guardian, estate or beneficiary in the
1
event of Section 8 or 9) Shares or a combination of cash and Shares, as the Company determines in its sole discretion, with a value equal to:
(a)
the number of RSUs that have become vested as of such vesting date or vesting event, as applicable, multiplied by the Fair Market Value of a Share on the date on which such RSUs vested; plus
(b)
a dividend equivalent payment determined by:
(1)
Multiplying, separately, the number of RSUs that became vested as determined in Section 3(a) by the dividend per Share on each dividend payment date between the Grant Date and the applicable Vesting Date to determine the dividend equivalent amount for each applicable dividend payment date;
(2)
dividing the amount determined in (1) above by the Fair Market Value of a Share on the dividend payment date to determine the number of additional whole and fractional RSUs to be credited to the Employee; and
(3)
multiplying the number of additional RSUs determined in (2) above by the Fair Market Value of a Share on the Vesting Date to determine the aggregate value of dividend equivalent payments for such vested RSUs;
provided, however, that if any aggregated dividend equivalent payments in Section (b)(2) above to be delivered in Shares results in a payment of a fractional Share, such fractional Share shall be rounded up to the next whole Share.
4.
Restrictions.
Except as otherwise provided for in this Grant Agreement, the RSUs or rights granted hereunder may not be sold, pledged or otherwise transferred. The period of time between the Grant Date and the date the RSUs become fully vested pursuant to Section 2 is referred to herein as the “Restriction Period.”
5.
Custody of Restricted Stock Units.
The RSUs subject hereto shall be recorded in an account with the Plan broker in the name of the Employee. Upon termination of the Restriction Period, if the Company determines, in its sole discretion, to deliver Shares pursuant to Section 3 above, such Shares shall be released into the Employee’s account; provided, however, that a portion of such Shares shall be surrendered in payment of Tax-Related Items, as defined and in accordance with Section 11 below, unless the Company, in its sole discretion, establishes alternative procedures for the payment of Tax-Related Items.
6.
No Stockholder Rights.
RSUs represent hypothetical Shares. The Employee shall not be entitled to any of the rights or benefits generally accorded to stockholders until the Shares are issued to the Employee pursuant to the terms of this Grant Agreement and the Employee becomes a holder of record of the Shares following the vesting of the RSUs.
7.
Termination of Employment.
Except as otherwise provided for in this Grant Agreement or in the Plan or as otherwise determined by the Company in its sole discretion, if the Employee’s employment with the Company, any Subsidiary or Affiliate is terminated at any time for any reason prior to the lapse of the Restriction Period, all unvested RSUs granted hereunder shall be forfeited by the Employee, except to the extent a severance plan applicable to the Employee provides otherwise.
For purposes of this Grant Agreement, the Employee’s employment or service will be considered terminated as of the date he or she is no longer actively providing services to the Company, any Subsidiary or Affiliate (regardless of the reason for such termination and whether or not later found to be invalid or in breach of employment laws in the jurisdiction where the Employee is employed or retained or the terms of the Employee’s employment or service agreement, if any) and will not be extended by any notice period (e.g., the Employee’s period of employment or service would not include any contractual notice period or any period of “garden leave” or similar period mandated under the employment laws in the jurisdiction where the Employee is employed or retained or the terms of the Employee’s employment or service agreement, if any). The Committee shall have the exclusive discretion to determine when the Employee’s employment or service is terminated for purposes of this Grant Agreement (including whether the Employee may still be considered to be providing service while on a leave of absence).
8.
Disability or Retirement of the Employee.
If the Employee’s employment is terminated prior to the end of the Restriction Period by reason of the Employee’s total and permanent disability or retirement in accordance with the applicable retirement policy, all RSUs shall immediately vest including any amounts for dividend equivalent payments on RSUs that vest at termination subject to the condition that the Employee shall have executed a current Agreement Regarding Confidential Information and Proprietary Developments (“ARCIPD”) that is satisfactory to the Company, and shall not have engaged in any conduct that creates a conflict of interest in the opinion of the Company.
9.
Death of the Employee.
In the event of the Employee’s death prior to the end of the Restriction Period, all unvested RSUs shall immediately vest including any amounts for dividend equivalent payments on such vested RSUs.
10.
Section 409A.
Payments made pursuant to the Plan and this Grant Agreement are intended to comply with or qualify for an exemption from Section 409A of the Code (“Section 409A”). The Company reserves the right, to the extent the Company deems necessary or
2
advisable in its sole discretion, to unilaterally amend or modify the Plan and/or this Grant Agreement or adopt other policies and procedures (including amendments, policies and procedures with retroactive effect), or take any other actions, including any amendments or actions that would result in the reduction of benefits payable under this Grant Agreement, as the Company determines are necessary or appropriate to ensure that all RSUs are made in a manner that qualifies for an exemption from, or complies with, Section 409A or mitigate any additional tax, interest and/or penalties or other adverse tax consequences that may apply under Section 409A: provided however, that the Company makes no representations that the RSUs will be exempt from any penalties that may apply under Section 409A and makes no undertaking to preclude Section 409A from applying to this RSU. For the avoidance of doubt, the Employee hereby acknowledges and agrees that the Company will have no liability to the Employee or any other party if any amounts payable under this Grant Agreement are not exempt from, or compliant with, Section 409A, or for any action taken by the Company with respect thereto. Any payments under this Grant Agreement, the settlement of which is triggered by a “separation from service” (within the meaning of Section 409A) of a “specified employee” (as defined under Section 409A), shall be made on a date that is the earlier of (a) the Employee’s death or (b) the later of the specified settlement date and the date which is six months after the date of the Employee’s separation from service.
11.
Taxes.
(a)
The Employee shall be liable for any and all taxes, including income tax, social insurance, fringe benefit tax, payroll tax, payment on account, employer taxes or other tax-related items related to the Employee’s participation in the Plan and legally applicable to or otherwise recoverable from the Employee by the Company and/or, if different, the Employee’s employer (the “Employer”) whether incurred at grant, vesting, sale, prior to vesting or at any other time (“Tax-Related Items”). In the event that the Company or the Employer (which, for purposes of this Section 11, shall include a former employer) is required, allowed or permitted to withhold taxes as a result of the RSUs or the Shares acquired pursuant to such RSUs, or due upon receipt of dividend equivalent payments or dividends, the Employee shall surrender a sufficient number of whole Shares, make a cash payment or make adequate arrangements satisfactory to the Company and/or the Employer to withhold such taxes from Employee’s wages or other cash compensation paid to the Employee by the Company and/or the Employer at the election of the Company, in its sole discretion, or, if permissible under local law, the Company may sell or arrange for the sale of Shares that Employee acquires as necessary to cover all Tax-Related Items that the Company or the Employer has to withhold or that are legally recoverable from the Employee (such as fringe benefit tax) at the time the restrictions on the RSUs lapse, unless the Company, in its sole discretion, has established alternative procedures for such payment. However, with respect to any RSUs subject to Section 409A, the Employer shall limit the surrender of Shares to the minimum number of Shares permitted to avoid a prohibited acceleration under Section 409A. The Employee will receive a cash refund for any fraction of a surrendered Share or Shares in excess of any and all Tax-Related Items. To the extent that any surrender of Shares or payment of cash or alternative procedure for such payment is insufficient, the Employee authorizes the Company, its Affiliates and Subsidiaries, which are qualified to deduct tax at source, to deduct from the Employee’s compensation all Tax-Related Items. The Employee agrees to pay any Tax-Related Items that cannot be satisfied from wages or other cash compensation, to the extent permitted by Applicable Law.
To avoid negative accounting treatment, the Company and/or the Employer may withhold or account for Tax-Related Items by considering applicable minimum statutory withholding amounts or other applicable withholding rates, including maximum applicable rates, in which case the Employee will receive a refund of any over-withheld amount in cash and will have no entitlement to the Share equivalent. If the obligation for Tax-Related Items is satisfied by withholding in Shares, for tax purposes, the Employee is deemed to have been issued the full number of Shares subject to the vested RSUs, notwithstanding that a number of the Shares is held back solely for the purpose of paying the Tax-Related Items due as a result of any aspect of the Employee’s participation in the Plan.
(b)
Regardless of any action the Company or the Employer takes with respect to any or all Tax-Related Items, the Employee acknowledges and agrees that the ultimate liability for all Tax-Related Items is and remains the Employee’s responsibility and may exceed the amount actually withheld by the Company or the Employer. The Employee further acknowledges that the Company and/or the Employer: (i) make no representations nor undertakings regarding the treatment of any Tax-Related Items in connection with any aspect of this grant of RSUs or dividend equivalents, including, but not limited to, the grant, vesting or settlement of RSUs or dividend equivalents, the subsequent delivery of Shares and/or cash upon settlement of such RSUs or the subsequent sale of any Shares acquired pursuant to such RSUs and receipt of any dividends or dividend equivalent payments; and (ii) notwithstanding Section 10, do not commit to and are under no obligation to structure the terms or any aspect of this grant of RSUs and/or dividend equivalents to reduce or eliminate the Employee’s liability for Tax-Related Items or to achieve any particular tax result. Further, if the Employee has become subject to tax in more than one jurisdiction, the Employee acknowledges that the Company and/or the Employer may be required to withhold or account for Tax-Related Items in more than one jurisdiction. The Employee shall pay the Company or the Employer any amount of Tax-Related Items that the Company or the Employer may be required to withhold or account for as a result of the Employee’s participation in the Plan or the Employee’s receipt of RSUs that cannot be satisfied by the means previously described. The Company may refuse to deliver the benefit described in Section 3 if the Employee fails to comply with the Employee’s obligations in connection with the Tax-Related Items.
(c)
In accepting the RSUs, the Employee consents and agrees that in the event the RSUs or the dividend equivalents become subject to an employer tax that is legally permitted to be recovered from the Employee, as may be determined by the Company and/or the Employer at their sole discretion, and whether or not the Employee’s employment with the Company and/or the Employer is continuing at the time such tax becomes recoverable, the Employee will assume any liability for any such taxes that may be payable by the Company and/or the Employer in connection with the RSUs and dividend equivalents. Further, by accepting the RSUs, the Employee agrees that the Company and/or the Employer may collect any such taxes from
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the Employee by any of the means set forth in this Section 11. The Employee further agrees to execute any other consents or elections required to accomplish the above, promptly upon request of the Company.
12.
Data Privacy Consent.
(a)
The Employee hereby explicitly and unambiguously consents to the collection, use and transfer, in electronic or other form, of the Employee’s personal data as described in this Grant Agreement and any other materials by and among, as applicable, the Company, the Employer and its other Subsidiaries and Affiliates for the exclusive purpose of implementing, administering and managing the Employee’s participation in the Plan.
(b)
The Employee understands that the Company, the Employer and its other Subsidiaries and Affiliates may hold certain personal information about the Employee, including, but not limited to, name, home address and telephone number, date of birth, social insurance number or other identification number, salary, nationality, residency, status, job title, any shares of stock or directorships held in the Company, details of all RSUs, options or any other entitlement to shares of stock granted, canceled, purchased, exercised, vested, unvested or outstanding in the Employee’s favor (“Data”) for the exclusive purpose of implementing, managing and administering the Plan.
(c)
The Employee understands that Data will be transferred to the Company or one or more stock plan service providers as may be selected by the Company from time to time, which is assisting the Company with the implementation, administration and management of the Plan. The Employee understands that the recipients of the Data may be located in the United States or elsewhere, and that the recipient’s country of operation (e.g., the United States) may have different data privacy laws and protections than the Employee’s country. The Employee understands that if he or she resides outside the United States, the Employee may request a list with the names and addresses of any potential recipients of the Data by contacting his or her local human resources representative. The Employee authorizes the Company and any other possible recipients which may assist the Company (presently or in the future) with implementing, administering and managing the Plan to receive, possess, use, retain and transfer the Data, in electronic or other form, for the sole purposes of implementing, administering and managing the Employee’s participation in the Plan. The Employee understands that Data will be held only as long as is necessary to implement, administer and manage the Employee’s participation in the Plan. The Employee understands that if he or she resides outside the United States, the Employee may, at any time, view Data, request additional information about the storage and processing of Data, require any necessary amendments to Data or refuse or withdraw the consents herein, in any case without cost, by contacting in writing his or her local human resources representative.
(d)
Further, the Employee understands that he or she is providing the consents herein on a purely voluntary basis. If the Employee does not consent, or if the Employee later seeks to revoke his or her consent, the Employee’s employment and career with the Employer will not be affected; the only consequence of refusing or withdrawing the Employee’s consent is that the Company would not be able to grant RSUs or other equity awards to the Employee or administer or maintain such awards. Therefore, the Employee understands that refusing or withdrawing the consent may affect the Employee’s ability to participate in the Plan. For more information on the consequences of the Employee’s refusal to consent or withdrawal of consent, the Employee understands that he or she may contact his or her local human resources representative.
13.
Plan Information.
The Employee agrees to receive copies of the Plan, the Plan prospectus and other Plan information, including information prepared to comply with Applicable Laws outside the United States, from the Long-term Incentives website and stockholder information, including copies of any annual report, proxy and Form 10-K, from the investor relations section of the Company’s website at www.hp.com. The Employee acknowledges that copies of the Plan, Plan prospectus, Plan information and stockholder information are available upon written or telephonic request to the Company Secretary. The Employee hereby consents to receive any documents related to current or future participation in the Plan by electronic delivery and agrees to participate in the Plan through an on-line or electronic system established and maintained by the Company or a third party designated by the Company.
14.
Acknowledgment and Waiver.
By accepting this grant of RSUs, the Employee understands, acknowledges and agrees that:
(a)
except as provided in Sections 8 and 9, the vesting of the RSUs is earned only by continuing as an employee with the Company or one of its Subsidiaries or Affiliates and that being hired and granted RSUs will not result in the RSUs vesting;
(b)
this Grant Agreement and its incorporated documents reflect all agreements on its subject matters and the Employee is not accepting this Grant Agreement based on any promises, representations or inducements other than those reflected in this Grant Agreement;
(c)
all good faith decisions and interpretations of the Committee regarding the Plan and Awards granted under the Plan are binding, conclusive and final;
(d)
the Plan is established voluntarily by the Company, it is discretionary in nature and may be modified, amended, suspended or terminated by the Company at any time;
(e)
the grant of RSUs is voluntary and occasional and does not create any contractual or other right to receive future grants of RSUs or other awards, or benefits in lieu of RSUs, even if Shares or RSUs have been granted in the past;
(f)
all decisions with respect to future grants, if any, will be at the sole discretion of the Company;
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(g)
the Employee’s participation in the Plan shall not create a right to further employment with the Employer and shall not interfere with the ability of the Employer to terminate the Employee’s employment relationship at any time and it is expressly agreed and understood that employment is terminable at the will of either party;
(h)
the Employee is voluntarily participating in the Plan;
(i)
RSUs and their resulting benefits are extraordinary items that are outside the scope of the Employee’s employment contract, if any;
(j)
RSUs and their resulting benefits are not intended to replace any pension rights or compensation;
(k)
RSUs and their resulting benefits are not part of normal or expected compensation or salary for any purposes, including, but not limited to calculating any severance, resignation, termination, redundancy, dismissal, end of service payments, bonuses, long-service awards, pension or retirement or welfare benefits or similar payments;
(l)
unless otherwise agreed by the Company, the RSUs and their resulting benefits are not granted as consideration for, or in connection with, the service the Employee may provide as a director of a Subsidiary or Affiliate;
(m)
this grant of RSUs will not be interpreted to form an employment contract or relationship with the Company, and furthermore, this grant of RSUs will not be interpreted to form an employment contract with any Subsidiary or Affiliate;
(n)
the future value of the underlying Shares is unknown, indeterminable and cannot be predicted with certainty;
(o)
no claim or entitlement to compensation or damages shall arise from forfeiture of the RSUs resulting from termination of Employee’s employment (regardless of the reason for such termination and whether or not later found to be invalid or in breach of employment laws in the jurisdiction where the Employee is employed or retained or the terms of the Employee’s employment or service agreement, if any), and in consideration of the grant of the RSUs to which the Employee is otherwise not entitled, the Employee irrevocably agrees never to institute any claim against the Company, the Employer or any other Subsidiary or Affiliate and releases the Company, the Employer and any other Subsidiary and Affiliate from any such claim; if, notwithstanding the foregoing, any such claim is allowed by a court of competent jurisdiction, then, by participating in the Plan, the Employee shall be deemed irrevocably to have agreed not to pursue such claim and to have agreed to execute any and all documents necessary to request dismissal or withdrawal of such claims;
(p)
the Company, the Employer or any other Subsidiary or Affiliate will not be liable for any foreign exchange rate fluctuation between the Employee’s local currency and the United States dollar that may affect the value of the RSUs or any amounts due to the Employee pursuant to the settlement of the RSUs or the subsequent sale of any Shares acquired upon settlement;
(q)
if the Company determines that the Employee has engaged in misconduct prohibited by Applicable Law or any applicable policy of the Company, as in effect from time to time, or the Company is required to make recovery from the Employee under Applicable Law or a Company policy adopted to comply with applicable legal requirements, then the Company may, in its sole discretion, to the extent it determines appropriate, (i) recover from the Employee the proceeds from RSUs vested up to three years prior to the Employee’s termination of employment or any time thereafter, (ii) cancel the Employee’s outstanding RSUs, and (iii) take any other action it deems to be required and appropriate; and
(r)
the delivery of any documents related to the Plan or Awards granted under the Plan, including the Plan, this Grant Agreement, the Plan prospectus and any reports of the Company generally provided to the Company’s stockholders, may be made by electronic delivery. Such means of electronic delivery may include the delivery of a link to a Company intranet or the Internet site of a third party involved in administering the Plan, the delivery of the document via electronic mail or other such means of electronic delivery specified by the Company. The Employee may receive from the Company a paper copy of any documents delivered electronically at no cost to the Employee by contacting the Company in writing in accordance with Section 17(k). If the attempted electronic delivery of any document fails, the Employee will be provided with a paper copy of such document. The Employee may revoke his or her consent to the electronic delivery of documents or may change the electronic mail address to which such documents are to be delivered (if the Employee has provided an electronic mail address) at any time by notifying the Company of such revoked consent or revised electronic mail address in accordance with Section 17(k). The Employee is not required to consent to the electronic delivery of documents.
15.
No Advice Regarding Grant.
The Company is not providing any tax, legal or financial advice, nor is the Company making any recommendations regarding the Employee’s participation in the Plan, or the Employee’s acquisition or sale of the underlying Shares. The Employee is hereby advised to consult with his or her own personal tax, legal and financial advisors regarding his or her participation in the Plan before taking any action related to the Plan.
16.
Additional Eligibility Requirements Permitted.
In addition to any other eligibility criteria provided for in the Plan, the Company may require that the Employee execute a separate document agreeing to the terms of a current arbitration agreement and/or a current ARCIPD, each in a form acceptable to the Company and/or that the Employee be in compliance with the ARCIPD throughout the entire Restriction Period and through the date the RSU is to be granted or settled. If such separate documents are required by the Company and the Employee does not
5
accept them within 75 days of the Grant Date or such other date as of which the Company shall require in its discretion, this RSU shall be canceled and the Employee shall have no further rights under this Grant Agreement.
17.
Miscellaneous.
(a)
The Company shall not be required to treat as owner of RSUs and any associated benefits hereunder, any transferee to whom such RSUs or benefits shall have been transferred in violation of any of the provisions of this Grant Agreement.
(b)
The parties agree to execute such further instruments and to take such action as may reasonably be necessary to carry out the intent of this Grant Agreement.
(c)
The Plan is incorporated herein by reference. The Plan and this Grant Agreement constitute the entire agreement of the parties with respect to the subject matter hereof and supersede in their entirety all prior undertakings and agreements of the Company and the Employee with respect to the subject matter hereof, other than the terms of any severance plan applicable to the Employee that provides more favorable vesting. Notwithstanding the foregoing, nothing in the Plan or this Grant Agreement shall affect the validity or interpretation of any duly authorized written agreement between the Company and the Employee under which an award properly granted under and pursuant to the Plan serves as any part of the consideration furnished to the Employee. This Grant Agreement is governed by the laws of the state of Delaware without regard to its conflict of law provisions.
(d)
If the Employee has received this or any other document related to the Plan translated into a language other than English and if the meaning of the translated version is different than the English version, the English version will control.
(e)
The provisions of this Grant Agreement are severable and if any one or more provisions are determined to be illegal or otherwise unenforceable, in whole or in part, the remaining provisions shall nevertheless be binding and enforceable.
(f)
Notwithstanding Section 17(e), the Company’s obligations under this Grant Agreement and the Employee’s agreement to the terms of an arbitration agreement and/or an ARCIPD, if any, are mutually dependent. In the event that the Employee breaches the arbitration agreement or the Employee’s ARCIPD is breached or found not to be binding upon the Employee for any reason by a court of law, then the Company will have no further obligation or duty to perform under the Plan or this Grant Agreement.
(g)
A waiver by the Company of a breach of any provision of this Grant Agreement shall not operate or be construed as a waiver of any other provision of this Grant Agreement, or of any subsequent breach by the Employee or any other Awardee.
(h)
The Employee acknowledges that, depending on his or her country, the Employee may be subject to insider trading restrictions and/or market abuse laws, which may affect the Employee’s ability to acquire or sell Shares or rights to Shares (
e.g.,
RSUs) under the Plan during such times as the Employee is considered to have “inside information” regarding the Company (as defined by the laws in the Employee’s country). Any restrictions under these laws or regulations are separate from and in addition to any restrictions that may be imposed under any applicable Company insider trading policy. The Employee is responsible for ensuring compliance with any applicable restrictions and is advised to consult his or her personal legal advisor on this matter.
(i)
The Company reserves the right to impose other requirements on the Employee’s participation in the Plan, on the RSUs and on any Shares acquired under the Plan, to the extent the Company determines it is necessary or advisable for legal or administrative reasons, and to require the Employee to sign any additional agreements or undertakings that may be necessary to accomplish the foregoing.
(j)
Any notice required or permitted hereunder to the Employee shall be given in writing and shall be deemed effectively given upon delivery to the Employee at the address then on file with the Company.
(k)
Any notice to be given under the terms of this Grant Agreement to the Company will be addressed in care of Attn: Global Equity Administration at HP Inc., 1501 Page Mill, Palo Alto, California 94304, USA.
(l)
The Employee acknowledges that there may be certain foreign asset and/or account reporting requirements which may affect his or her ability to acquire or hold Shares acquired under the Plan or cash received from participating in the Plan (including from any dividends or dividend equivalent payments) in a brokerage or bank account outside the Employee’s country. The Employee may be required to report such accounts, assets or transactions to the tax or other authorities in his or her country. The Employee also may be required to repatriate sale proceeds or other funds received as a result of the Employee’s participation in the Plan to his or her country through a designated bank or broker within a certain time after receipt. The Employee acknowledges that it is his or her responsibility to be compliant with such regulations, and the Employee is advised to consult his or her personal legal advisor for any details.
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HP Inc.
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Dion Weisler
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CEO and President
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Tracy Keogh
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Chief Human Resources Officer
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RETAIN THIS GRANT AGREEMENT FOR YOUR RECORDS
Important Note:
Your grant is subject to the terms and conditions of this Grant Agreement, including any Appendix for your country, and to the Company obtaining all necessary government approvals. If you have questions regarding your grant, please contact Stock Plan Administration.
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APPENDIX
HP INC. 2004 STOCK INCENTIVE PLAN, AS AMENDED
GRANT AGREEMENT FOR NON-U.S. EMPLOYEES
Capitalized terms used but not defined herein shall have the meanings ascribed to them in the Grant Agreement or the Plan.
This Appendix includes additional terms and conditions that govern the RSUs granted to the Employee if the Employee resides and/or works in one of the countries listed herein. This Appendix is part of the Grant Agreement.
If the Employee is a citizen or resident (or is considered as such for local law purposes) of a country other than the country in which the Employee is currently residing and/or working, or if the Employee transfers to another country after the Grant Date, the Company shall, in its discretion, determine to what extent the special terms and conditions contained herein shall be applicable to the Employee.
This Appendix also includes information and notices regarding securities, exchange control, tax and certain other issues of which the Employee should be aware with respect to his or her participation in the Plan. The information is based on the securities, exchange control, tax and other laws in effect in the respective countries as of September 2015. Such laws are often complex and change frequently. As a result, the Company strongly recommends that the Employee not rely on the information contained herein as the only source of information relating to the consequences of his or her participation in the Plan because the information may be out of date at the time the Employee vests in the RSUs, receives Shares, a cash payment or a dividend equivalent payment upon vesting, sells any Shares acquired under the Plan or receive dividends paid on such Shares. In addition, the information is general in nature and may not apply to the Employee’s particular situation, and the Company is not in a position to assure the Employee of any particular result. Therefore, the Employee is advised to seek appropriate professional advice as to how the relevant laws in his or her country may apply to the Employee’s individual situation.
If the Employee is a citizen or resident (or is considered as such for local law purposes) of a country other than the country in which the Employee is currently residing and/or working, or if the Employee transfers to another country after the Grant Date, the information contained herein may not be applicable to the Employee in the same manner.
ALBANIA
Securities Notice
Securities approval is required for the resale of Shares in Albania for Albanian residents.
ALGERIA
Payout of RSUs in Cash Only
Pursuant to the Company’s discretion under Section 2(ii) of the Plan and notwithstanding the language in Section 3 of the Grant Agreement, due to legal considerations in Algeria, the RSUs granted to Employees in Algeria shall be settled in cash only, paid through local payroll (less any Tax-Related Items and/or fees) and do not provide any right for the Employee to receive Shares.
ANGOLA
Securities Notice
The Plan is not an offer to the public in Angola. RSUs are granted only to employees of the Company and its Subsidiaries and Affiliates. Any securities granted under the Plan are not negotiable in Angola.
Payout of RSUs in Cash Only
Pursuant to the Company’s discretion under Section 2(ii) of the Plan and notwithstanding the language in Section 3 of the Grant Agreement, due to legal considerations in Angola, the RSUs granted to Employees in Angola shall be settled in cash only (less any Tax-Related Items and/or fees) and do not provide any right for the Employee to receive Shares.
Exchange Control Notice
All proceeds from the vesting of the RSUs and cash payment are required to be repatriated to Angola.
ARGENTINA
Securities Notice
Shares of the Company are not publicly offered or listed on any stock exchange in Argentina. The offer is private and not subject to the supervision of any Argentine governmental authority.
Exchange Control Notice
If the Employee transfers proceeds realized under the Plan (
e.g.
, from the sale of Shares) into Argentina within ten days of receipt (i.e., the proceeds have not been held in an offshore bank or brokerage account for at least ten days prior to transfer), the Employee must
8
deposit 30% of the proceeds into a non-interest bearing account in Argentina for 365 days. If the Employee has satisfied the ten day holding obligation, the Argentine bank handling the transaction may still request certain documentation in connection with the Employee’s request to transfer proceeds into Argentina, including evidence of the sale and proof that no funds were remitted out of Argentina to acquire the Shares. Please note that exchange control regulations in Argentina are subject to frequent change. The Employee should consult with his or her personal legal advisor regarding any exchange control obligations he or she may have in connection with his or her participation in the Plan.
Foreign Asset/Account Reporting Notice
Argentine residents must report any Shares acquired under the Plan and held by the resident on December 31st of each year on their annual tax return for that year. Argentine residents should consult with their personal tax advisor to determine their personal reporting obligations.
AUSTRALIA
Breach of Law
. Notwithstanding anything to the contrary in the Plan or the Grant Agreement, the Employee will not be entitled to, and shall not claim any benefit (including without limitation a legal right) under the Plan if the provision of such benefit would give rise to a breach of Part 2D.2 of the Corporations Act 2001 (Cth), any other provision of that Act, or any other applicable statute, rule or regulation which limits or restricts the giving of such benefits. Further, the employer is under no obligation to seek or obtain the approval of its stockholders in a general meeting for the purpose of overcoming any such limitation or restriction.
Australian Offer Document
The Employee’s right to participate in the Plan and the RSUs granted under the Plan are subject to the terms and conditions stated in the Offer Document, the Plan, the Grant Agreement and this Appendix. By accepting the RSUs, the Employee acknowledges and confirms that he or she has reviewed these documents.
Securities Notice
If the Employee acquires Shares under the Plan and subsequently offers to sell the Shares to a person or entity resident in Australia, such offer may be subject to disclosure requirements under Australian law. The Employee should obtain legal advice regarding any applicable disclosure requirements prior to making any such offer.
Exchange Control Notice
Exchange control reporting is required for cash transactions exceeding AUD10,000 and for international fund transfers. If an Australian bank is assisting with the transaction, the bank will file the report on behalf of the Employee.
AUSTRIA
Exchange Control Notice
If the Employee holds Shares acquired under the Plan outside of Austria, the Employee will be required to submit reports to the Austrian National Bank as follows: (i) on a quarterly basis if the value of the Shares as of any given quarter exceeds €30,000,000; and (ii) on an annual basis if the value of the Shares as of December 31 exceeds €5,000,000. If quarterly reporting is required, the reports must be filed by the fifteenth day of the month following the last day of the respective quarter. The deadline for filing the annual report is January 31 of the following year.
If the Employee sells Shares or receives any cash dividends or dividend equivalent payments, the Employee may have exchange control obligations if he or she holds the cash proceeds outside of Austria. If the transaction volume of all the Employee’s accounts abroad exceeds €10,000,000, the Employee must report the movements and balances of all accounts on a monthly basis, as of the last day of the month, on or before the fifteenth day of the following month,
on the prescribed form (
Meldungen SI-Forderungen und/oder SI-Verpflichtungen
).
Consumer Protection Notice
The Employee may be entitled to revoke the RSUs on the basis of the Austrian Consumer Protection Act under the following conditions:
(i)
The revocation must be made within one week of the day the Employee accepts the Grant Agreement.
(ii)
The revocation must be in written form to be valid. It is sufficient if the Employee returns the Grant Agreement to the Company or the Company’s representative with language which can be understood as a refusal to conclude or honor the Grant Agreement, provided the revocation is sent within the period discussed above.
AZERBAIJAN
Payout of RSUs in Cash Only
Pursuant to the Company’s discretion under Section 2(ii) of the Plan and notwithstanding the language in Section 3 of the Grant Agreement, due to legal considerations in Azerbaijan, the RSUs granted to Employees in Azerbaijan shall be settled in cash only (less any Tax-Related Items and/or fees) and do not provide any right for the Employee to receive Shares.
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BAHRAIN
There are no country-specific provisions.
BANGLADESH
Securities Law Notice
The RSUs shall not be publicly offered or listed on any stock exchange in Bangladesh. The offer is intended to be private and the Grant Agreement does not constitute a prospectus for purposes of the 1969 Securities and Exchange Ordinance, as amended.
Payout of RSUs in Cash Only
Pursuant to the Company’s discretion under Section 2(ii) of the Plan and notwithstanding the language in Section 3 of the Grant Agreement, due to legal considerations in Bangladesh, the RSUs granted to Employees in Bangladesh shall be settled in cash only (less any Tax-Related Items and/or fees) and do not provide any right for the Employee to receive Shares.
BELARUS
Exchange Control Notice
The Employee should obtain a permit from the National Bank of Belarus (“National Bank”) prior to acquiring Shares upon vesting of the RSUs. To obtain the permit, it is necessary to submit certain documents to the National Bank, likely including: (i) an application in a prescribed form; (ii) a copy of a personal identification document (e.g., passport); (iii) information on the Shares to be acquired (e.g., type, number, par value, name of the issuer); and (iv) a copy of the Grant Agreement. The Employee understands that if he or she fails to obtain a National Bank permit prior to vesting, the Employee may be subject to an administrative fine.
Please note that exchange control regulations in Belarus are subject to change. The Employee should consult with his or her personal legal advisor regarding any exchange control obligations that the Employee may have prior to acquiring Shares or receiving proceeds under the Plan. The Employee is responsible for ensuring compliance with all exchange control laws in Belarus.
BELGIUM
Foreign Asset/Account Reporting Notice
The Employee is required to report any bank accounts opened and maintained outside of Belgium on his or her annual tax return. In a separate report, the Employee may be required to provide the National Bank of Belgium with certain details regarding such foreign accounts (including the account number, bank name and country in which any such account was opened). This report, as well as additional information on how to complete it, can be found on the website of the National Bank of Belgium, www.nbb.be, under
Kredietcentrales / Centrales des crédits
caption. The Employee should consult with his or her personal tax advisor to determine his or her personal reporting obligations.
BOSNIA AND HERZEGOVINA
There are no country-specific provisions.
BOTSWANA
There are no country-specific provisions.
BRAZIL
Exchange Control Notice
The Employee is required to prepare and submit a declaration of assets and rights held outside of Brazil to the Central Bank on an annual basis. The assets and rights that must be reported include Shares issued under the Plan. However, if the Employee holds assets or rights valued at less than US$100,000, the Employee will not be required to submit a declaration. If such amount exceeds US$100,000,000, the referred declaration is required quarterly.
Intent to Comply with Law
By accepting the RSUs, the Employee acknowledges his or her agreement to comply with applicable Brazilian laws and to report and pay any and all applicable taxes associated with the vesting of the RSUs, the sale of any Shares acquired upon vesting of the RSUs and the receipt of any dividends or dividend equivalents.
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Tax on Financial Transaction (IOF)
If the Employee repatriates the proceeds from the sale of Shares and any cash dividends into Brazil and converts the funds into local currency, he or she will be subject to the Tax on Financial Transactions.
Labor Law Acknowledgment
This provision supplements Section 14 of the Grant Agreement:
By accepting this grant of RSUs, the Employee understands, acknowledges and agrees that:, for all legal purposes: (i) the benefits provided to the Employee under the Plan are unrelated to his or her employment; (ii) the Plan is not a part of the terms and conditions of the Employee’s employment; and (iii) the income from the RSUs, if any, is not part of the Employee’s remuneration from employment.
BULGARIA
Exchange Control Notice
If the Employee receives a payment related to the Plan in Bulgaria in excess of BGN100,000 (or its equivalent in another currency, e.g., U.S. dollars), the Employee is required to submit a form with information regarding the source of the income to the bank receiving such payment (for statistical purposes) upon transfer or within 30 days of receipt. The Employee should contact his or her bank in Bulgaria for additional information regarding this requirement.
CANADA
Payout of RSUs in Shares Only
Pursuant to its discretion under Section 2(ii) of the Plan,
with respect to all Employees residing in Canada, the Company will convert all vested RSUs only into an equivalent number of Shares. Employees residing in Canada (or in the event of death, such Employee’s legal representative or estate) will not receive an equivalent or fractional Share cash payment with respect to vested RSUs.
Data Privacy
The following provision supplements Section 12 of the Grant Agreement:
The Employee hereby authorizes the Company and the Company’s representatives to discuss with and obtain all relevant information from all personnel, professional or not, involved in the administration and operation of the Plan. The Employee further authorizes the Company and any Subsidiary or Affiliate and the administrator of the Plan to disclose and discuss the Plan with their advisors. The Employee further authorizes the Company and any Subsidiary or Affiliate to record such information and to keep such information in the Employee’s employee file.
Termination of Employment
The following provision replaces the second paragraph of Section 7 of the Grant Agreement:
For purposes of this Grant Agreement, the Employee’s employment or service will be considered terminated as of the earlier of: (a) the date on which the Employee’s employment is terminated; (b) the date the Employee receives notice of termination of employment from the Employer; or (c) the date on which the Employee is no longer actively employed by or actively providing services, regardless of any notice period or period of pay in lieu of such notice required under Applicable Law (including, but not limited to, statutory law, regulatory law and/or common law). The Committee shall have the exclusive discretion to determine when the Employee’s employment or service is terminated for purposes of this Grant Agreement (including whether the Employee may still be considered to be providing service while on a leave of absence).
Foreign Asset/Account Reporting Notice
.
If the total value of the Employee’s foreign property exceeds C$100,000 at any time during the year, the Employee must report all of his or her foreign property on Form T1135 (Foreign Income Verification Statement) by April 30 of the following year. Foreign property includes Shares acquired under the Plan and may include the RSUs. The RSUs must be reported—generally at a nil cost—if the $100,000 cost threshold is exceeded because of other foreign property the Employee holds. If Shares are acquired, their cost generally is the adjusted cost base (“ACB”) of the Shares. The ACB would normally equal the fair market value of the Shares at vesting, but if the Employee owns other shares, this ACB may have to be averaged with the ACB of the other shares. The Employee should speak with a personal tax advisor to determine the scope of foreign property that must be considered for purposes of this requirement.
Securities Law Notice
The Employee is permitted to sell Shares acquired in settlement of the RSUs through the designated broker appointed under the Plan provided the resale of Shares acquired in settlement of the RSUs takes place outside of Canada through facilities of a stock exchange on which the Shares are listed. The Shares are currently listed on the New York Stock Exchange in the United States under the ticker symbol “HPQ”.
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The following provisions will also apply to Employees who are resident in Quebec:
Consent to Receive Information in English
The parties acknowledge that it is their express wish that the Grant Agreement, as well as all documents, notices and legal proceedings entered into, given or instituted pursuant hereto or relating directly or indirectly hereto, be drawn up in English.
Les parties reconnaissent avoir exigé la rédaction en anglais de la convention («Grant Agreement»), ainsi que de tous documents, avis et procédures judiciaires, exécutés, donnés ou intentés en vertu de, ou liés directement ou indirectement à, la présente convention
.
Plan Document Acknowledgment
In accepting the grant of RSUs, the Employee acknowledges that he or she has received a copy of the Plan, has reviewed the Plan and the Grant Agreement in their entirety and fully understands and accepts all provisions of the Plan and the Grant Agreement.
CHILE
Securities Law Notice
.
The offer of RSUs constitutes an offering of securities in Chile subject to General Ruling N° 345 (“NCG 345”) of the Chilean Superintendence of Securities and Insurance (“SVS”). This offer refers to securities not registered at the securities registry or at the foreign securities registry of the SVS, and therefore, such securities are not subject to oversight of the SVS. Given that that the RSUs are not registered in Chile, the Company is not required to provide public information about the RSUs or shares of common stock in Chile. Unless the securities offered are registered with the SVS, a public offering of such securities cannot be made in Chile, unless the offer complies with the conditions set forth in NCG 345.
Información bajo la Ley de Mercado de Valores
Esta oferta de Unidades de Acciones Restringidas (“RSU”) constituye uno oferta sujeta a la norma de carácter general N°345 (“NCG 345”) de la superintendenceia de valores y seguros de Chile (“SVS”). Esta oferta versa sobre valores no inscritos en el registro de valores o en el registro de valores extranjeros que lleva la SVS, por lo que tales valores no están sujetos a la fiscalización de ésta. Por tratarse los RSU de valores no inscritos en Chile no existe la obligación por parte del emisor de entregar en Chile información pública respecto de los RSU o de las acciones. Estos valores no podrán ser objecto de oferta pública respecto de los RSUs o de las acciones. Estos valores no podrán ser objeto de oferta pública en Chile mientras no sean inscritos en el registro de valores correspondiente, a menos que la oferta cumpla con las condiciones establecidas en la NCG 345.
Exchange Control Notice.
The Employee is not required to repatriate funds obtained from the sale of Shares or the receipt of any dividends or dividend equivalents. However, if the Employee decides to repatriate such funds, the Employee must do so through the Formal Exchange Market if the amount of the funds exceeds US$10,000. In such case, the Employee must report the payment to the commercial bank or registered foreign exchange office receiving the funds.
The Employee is responsible for complying with foreign exchange requirements in Chile. For general information purposes, as of the date hereof, the Employee’s aggregate investments held outside of Chile exceed US$5,000,000 (including the Shares and any other cash proceeds obtained under the Plan), the Employee must report the investments annually to the Central Bank. Annex 3.1 of Chapter XII of the Foreign Exchange Regulations must be used to file this report. Please note that exchange control regulations in Chile are subject to change. The Employee should consult with his or her personal legal advisor regarding any exchange control obligations that the Employee may have prior to vesting in the RSUs, receiving proceeds from the sale of Shares acquired upon vesting of the RSUs or cash dividends or dividend equivalents.
Foreign Asset/Account Reporting Notice
The Chilean Internal Revenue Service (“CIRS”) requires all taxpayers to provide information annually regarding: (i) the taxes paid abroad which they will use as a credit against Chilean income taxes and (ii) the results of foreign investments. These annual reporting obligations must be complied with by submitting a sworn statement setting forth this information before June 30 of each year. The forms to be used to submit the sworn statement are Tax Form 1853 “Annual Sworn Statement Regarding Foreign Source Income” and Tax Form 1851 “Annual Sworn Statement Regarding Investments Held Abroad.” If the Employee is not a Chilean citizen and has been a resident in Chile for less than three years, the Employee is exempt from the requirement to file Tax Form 1853. These statements must be submitted electronically through the CIRS website: www.sii.cl.
CHINA
Payout of RSUs in Cash Only
Pursuant to the Company’s discretion under Section 2(ii) of the Plan and notwithstanding the language in Section 3 of the Grant Agreement, due to exchange control restrictions in
People’s Republic of China (the “PRC”), the RSUs granted to Employees in China shall be settled in cash only (less any Tax-Related Items and/or fees) and do not provide any right for the Employee to receive Shares.
Exchange Control
The following terms and conditions will apply to Employees who are subject to exchange control restrictions and regulations in the PRC, including the requirements imposed by the State Administration of Foreign Exchange (“SAFE”), as determined by the Company in its sole discretion:
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The Employee understands and agrees that, pursuant to local exchange control requirements, the Employee will not be permitted to vest in an RSU or be issued any Shares under the Plan unless or until the Company, its Subsidiary or the Employer in the PRC has obtained an approval from SAFE for the Plan.
The Employee further understands and agrees that, pursuant to local exchange control requirements, the Employee will be required to immediately repatriate any cash payments or proceeds obtained with respect to participation in the Plan to the PRC. The Employee further understands that such repatriation of any cash payments or proceeds may need to be effectuated through a special exchange control account established by the Company, any Parent or Subsidiary, or the Employer, and the Employee hereby consents and agrees that any payment or proceeds may be transferred to such special account prior to being delivered to the Employee.
Any payment or proceeds may be paid to the Employee in U.S. dollars or local currency at the Company’s discretion. If the payments or proceeds are paid to the Employee in U.S. dollars, the Employee will be required to set up a U.S. dollar bank account in the PRC so that the payments or proceeds may be deposited into this account. If the payments or proceeds are paid to the Employee in local currency, the Company is under no obligation to secure any particular exchange conversion rate and the Company may face delays in converting the payments or proceeds to local currency due to exchange control restrictions.
The Employee further agrees to comply with any other requirements that may be imposed by the Company in the future to facilitate compliance with exchange control requirements in the PRC.
COLOMBIA
Labor Law Acknowledgement
The following provision supplements Section 14 of the Grant Agreement:
The Employee acknowledges that pursuant to Article 128 of the Colombian Labor Code, the Plan and related benefits do not constitute a component of the Employee’s “salary” for any legal purpose.
Exchange Control Notice
If the Employee holds investments outside Colombia (including Shares the Employee acquires under the Plan) and the aggregate value of such investments is US$500,000 or more as of December 31 of any year, the Employee will be required to register such investments with the Central Bank (
Banco de la República
) as foreign investments held abroad. Upon the subsequent sale or other disposition of any previously-registered investments, the Employee is not required to repatriate the sale proceeds to Colombia. However, the Employee must cancel the registration with the Central Bank by no later than March 31 of the year following the year in which such sale or disposition occurred. The Employee may be subject to fines if they fail to cancel such registration.
CONGO (BRAZZAVILLE)
Exchange Control Notice
All proceeds from the vesting of RSUs, the sale of Shares and any cash dividends or dividend equivalents are required to be repatriated to Congo (Brazzaville).
COSTA RICA
There are no country-specific provisions.
CROATIA
Exchange Control Notice
The Employee must report any foreign investments (including Shares acquired under the Plan) to the Croatian National Bank for statistical purposes and obtain prior approval of the Croatian National Bank for bank accounts opened abroad. However, because exchange control regulations may change without notice, the Employee should consult with his or her personal legal advisor to ensure compliance with current regulations. It is the Employee’s responsibility to comply with Croatian exchange control laws.
CZECH REPUBLIC
Exchange Control Notice
Upon request of the Czech National Bank (“CNB”), the Employee may need to fulfill certain notification duties when he or she acquires Shares upon vesting of the RSUs and the opening and maintenance of a foreign account. Even in the absence of a request from the CNB, the Employee may need to report foreign direct investments with a value of CZK2,500,000 or more in the aggregate and/or other foreign financial assets with a value of CZK200,000,000 or more. However, because exchange control regulations change frequently and without notice, the Employee should consult with his or her personal legal advisor prior to the vesting of the RSUs and the sale of Shares to ensure compliance with current regulations. It is the Employee’s responsibility to comply with any applicable Czech exchange control laws.
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DENMARK
Danish Stock Option Act
By participating in the Plan, the Employee acknowledges that he or she received an Employer Statement translated into Danish, which is being provided to comply with the Danish Stock Option Act. To the extent more favorable to the Employee, the terms set forth in the Employer Statement will apply to the Employee’s participation in the Plan.
Foreign Asset/Account Reporting Notice
The Employee understands that if he or she establishes an account holding Shares or an account holding cash outside of Denmark, they must report the account to the Danish Tax Administration. The form which should be used in this respect can be obtained from a local bank. (These obligations are separate from and in addition to the obligations described below.)
Securities/Tax Reporting Notice
If the Employee holds Shares acquired under the Plan in a brokerage account with a broker or bank outside of Denmark, the Employee is required to inform the Danish Tax Administration about the account. For this purpose, the Employee must file a Form V (
Erklaering V
) with the Danish Tax Administration. The Form V must be signed both by the Employee and by the applicable broker or bank where the account is held, unless an exemption from the broker/bank signature requirement is obtained from the Danish Tax Administration. It is possible to seek an exemption on the Form V, and it is strongly recommended that it be done at the time the Form V is submitted. The Employee understands that by signing the Form V, the broker or bank (to the extent the exemption is not obtained) and the Employee undertake to forward information to the Danish Tax Administration concerning the Shares in the account without further request each year. In the event that an exemption is not obtained and the applicable broker or bank with which the account is held does not wish to, or pursuant to the laws of the country in question, is not allowed to assume such obligation to report, the Employee acknowledges that he or she is solely responsible for providing certain details regarding the foreign brokerage account and Shares deposited therein to the Danish Tax Administration as part of the Employee’s annual income tax return. By signing the Form V, the Employee authorizes the Danish Tax Administration to examine the account. A sample of Form K can be found at the following website: www.skat.dk.
In addition, the Employee acknowledges that if he or she opens a brokerage account (or a deposit account with a U.S. bank) for the purpose of holding cash outside Denmark, the Employee is also required to inform the Danish Tax Administration of this account. To do so, the Employee must file a Form K (
Erklaering K
) with the Danish Tax Administration. The Form K must be signed both the Employee and by the applicable broker or bank where the account is held, unless an exemption from the broker/bank signature requirement is obtained from the Danish Tax Administration. It is possible to seek an exemption on the Form K, and it is strongly recommended that it be done at the time the Form V is submitted. The Employee understands that by signing the Form K, the broker or bank (to the extent the exemption is not obtained) and the Employee undertake an obligation to forward information to the Danish Tax Administration concerning the content of the account without further request each year. In the event that an exemption is not obtained and the applicable broker or bank with which the account is held, does not wish to, or pursuant to the laws of the country in question, is not allowed to assume such obligation to report, the Employee acknowledges that he or she is solely responsible for providing certain details regarding the foreign brokerage or bank account to the Danish Tax Administration as part of the Employee’s annual income tax return. The Employee understands that, by signing the Form K, the Employee authorizes the Danish Tax Administration to examine the account. A sample of Form K can be found at the following website: www.skat.dk.
ECUADOR
There are no country-specific provisions.
EGYPT
Exchange Control Notice
If the Employee transfers funds into Egypt in connection with the remittance of proceeds from the vesting of RSUs, sale of Shares or the receipt of any dividends or dividend equivalent payments, the Employee is required to transfer the funds through a bank registered in Egypt.
FINLAND
There are no country-specific provisions.
FRANCE
Language Consent
By accepting the grant of the RSUs, the Employee confirms having read and understood the Plan and the Grant Agreement, which were provided in English language. The
Employee accepts the terms of those documents accordingly.
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Consentement Relatif à la Langue Utilisée
En acceptant cette attribution d’actions gratuites, l’Employé confirme avoir lu et compris le Plan et le Contrat d’Attribution qui m’ont été transmis en langue anglaise. L’Employé accepte les termes et conditions incluses dans ces documents en connaissance de cause.
Foreign Asset/Account Reporting Information
The Employee is required to report all foreign accounts (whether open, current or closed) to the French tax authorities when filing his or her annual tax return. The Employee should consult his or her personal advisor to ensure compliance with applicable reporting obligations.
GERMANY
Exchange Control Notice
Cross-border payments in excess of €12,500 must be reported monthly to the German Federal Bank. If the Employee receives a cross-border payment in excess of €12,500 (e.g., proceeds from the sale of Shares acquired under the Plan), he or she must report the payment to German Federal Bank electronically using the “General Statistics Reporting Portal” available via the Bank’s website (www.bundesbank.de). The Employee should file the report by the fifth day of the month following the month in which the payment is made.
GHANA
There are no country-specific provisions.
GREECE
There are no country-specific provisions.
GUATEMALA
Language Consent
By participating in the Plan, the Employee acknowledges that he or she is proficient in reading and understanding English and fully understands the terms of the Plan and the Grant Agreement.
HONG KONG
Securities Warning
The contents of this document have not been reviewed by any regulatory authority in Hong Kong. The Employee is advised to exercise caution in relation to the offer. If the Employee is in any doubt about any of the contents of this document, he or she should obtain independent professional advice.
The RSUs and Shares acquired upon vesting of the RSUs do not constitute a public offering of securities under Hong Kong law and are available only to employees of the Company or any Subsidiary or Affiliate. The Plan, the Grant Agreement and other incidental communication materials have not been prepared in accordance with and are not intended to constitute a “prospectus” for a public offering of securities under the applicable securities legislation in Hong Kong. The RSUs are intended only for the personal use of each eligible employee of the Company or any Subsidiary or Affiliate and may not be distributed to any other person.
Sale Restriction
Any Shares
received at vesting are accepted as a personal investment. Notwithstanding anything contrary in the Grant Agreement or the Plan, in the event the RSUs vest and Shares are issued to the Employee or his or her legal representatives or estate within six months of the Grant Date, the Employee agrees that the Employee or his or her legal representatives or estate will not offer to the public or otherwise dispose of any Shares acquired prior to the six-month anniversary of the Grant Date.
Payout of RSUs in Shares Only
Pursuant to its discretion under Section 2(ii) of the Plan,
with respect to all Employees residing in Hong Kong, the Company will convert all vested RSUs only into an equivalent number of Shares. The Employees residing in Hong Kong (or in the event of death, the Employee’s legal representative or estate) will not receive an equivalent cash payment with respect to vested RSUs.
Nature of Scheme
The Company specifically intends that the Plan will not be an occupational retirement scheme for purposes of the Occupational Retirement Schemes Ordinance.
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HUNGARY
Payout of RSUs in Cash Only
Pursuant to the Company’s discretion under Section 2(ii) of the Plan and notwithstanding the language in Section 3 of the Grant Agreement, due to legal considerations in Hungary, the RSUs granted to Employees in Hungary shall be settled in cash only (less any Tax-Related Items or other withholding obligations set forth in Section 11 of the Grant Agreement in accordance with Applicable Law and/or fees) and do not provide any right for the Employee to receive Shares.
INDIA
Exchange Control Notice
The Employee understands that he or she must repatriate to India any proceeds from the sale of Shares acquired under the Plan and any dividend equivalent payment within 90 days of receipt, and any cash dividends within 180 days of receipt. The Employee will receive a foreign inward remittance certificate (“FIRC”) from the bank where the Employee deposits the foreign currency. The Employee should maintain the FIRC as evidence of the repatriation of funds in the event the Reserve Bank of India or the Employer requests proof of repatriation.
Foreign Asset/Account Reporting Notice
Indian residents are required to declare any foreign bank accounts and any foreign financial assets (including Shares held outside of India) in their annual tax return. Indian residents should consult with their personal tax advisor to determine their personal reporting obligations.
INDONESIA
Exchange Control Notice
Indonesian residents must provide the Bank of Indonesia with information on foreign exchange activities on an online monthly report no later than the fifteenth day of the following month of the activity. In addition, if the Employee remits funds into Indonesia (e.g., proceeds from the sale of Shares), the Indonesian bank through which the transaction is made will submit a report of the transaction to the Bank of Indonesia for statistical reporting purposes. For transactions of US$10,000 or more, a more detailed description of the transaction must be included in the report and the Employee may be required to provide information about the transaction (e.g., the relationship between the Employee and the transferor of the funds, the source of the funds, etc.) to the bank in order for the bank to complete the report.
IRELAND
Director Reporting Notice
If the Employee is a director, shadow director(1) or secretary of an Irish Subsidiary or Affiliate whose interests meet or exceed 1% of the Company’s voting rights, pursuant to Section 53 of the Irish Company Act 1990, the Employee must notify the Irish Subsidiary or Affiliate in writing within five business days of receiving or disposing of an interest in the Company (e.g
.
, RSUs, Shares, etc.), or within five business days of becoming aware of the event giving rise to the notification requirement, or within five business days of becoming a director, shadow director or secretary if such an interest exists at that time. This notification requirement also applies with respect to the interests of a spouse or minor children, whose interests will be attributed to the director, shadow director or secretary.
ISRAEL
Israeli Sub-Plan
The RSUs are granted to the Employee pursuant to the Israeli Sub-Plan to the HP Inc. Second Amended and Restated 2004 Stock Incentive Plan (the “Israeli Sub-Plan”), and are subject to the terms and conditions stated in the Israeli Sub-Plan, the Plan and the Grant Agreement, including this Appendix. By accepting the RSUs, the Employee acknowledges and agrees to be bound by the terms of the Israeli Sub-Plan. The Israeli Sub-Plan is incorporated herein by reference and references to the Plan include the Israeli Sub-Plan.
The RSUs and Shares issued upon vesting of such RSUs are intended to qualify for the tax treatment available in Israel pursuant to the provisions of the “capital gain route” under Section 102 of the Israeli Tax Ordinance (“Section 102”), including the provisions of the Income Tax (Tax Abatement on the Grant of Shares to Employees) Regulations 2003 (the “Regulations”), and any tax ruling or agreement obtained by the Company or the Employer with regard to the Plan. It is clarified that in order to qualify for the “capital gains route,” the RSUs may be settled only in Shares.
Custody of RSUs
The following provisions replace Section 5 of the Grant Agreement:
(1) A shadow director is an individual who is not on the board of directors of the Company or the Irish Subsidiary or Affiliate but who has sufficient control so that the board of directors of the Company or the Irish Subsidiary or Affiliate, as applicable, acts in accordance with the directions and instructions of the individual.
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5. Custody of Restricted Stock Units.
(a) The RSUs subject hereto shall be held in trust by Tamir Fishman, as trustee (the “Trustee”) and further recorded in a restricted book entry account in the name of the Employee. Each RSU will be deemed granted on the date stated above, provided that (i) the Company has provided a copy of this Agreement to the Trustee and (ii) the Employee has signed all documents required pursuant to Applicable Law and under the Plan. Upon completion of the Restriction Period, Shares issued pursuant to Section 3 above shall be deposited with the Trustee (as further detailed below) in lieu of the RSUs previously held by the Trustee; provided, however, that a portion of such Shares may be surrendered in payment of any Tax-Related in accordance with Section 11 of this Grant Agreement, unless the Company, in its sole discretion, establishes alternative procedures for the payment of such taxes.
(b) Without derogating from the above, the Shares shall further be held in accordance with the undertakings of the Company and the Trustee, under a Trust Agreement in accordance with Section 102(b)(2) of the Israeli Tax Ordinance. Under the conditions of Section 102(b)(2), the RSUs and the Shares may be issued to the Employee only through the Trustee. To receive the tax treatment provided for in Section 102(b)(2), the RSUs and the Shares must be issued to the Trustee for a period of no less than 24 months from their Grant Date and deposit with the Trustee (the “Lock-Up Period”). In order for the tax benefits of Section 102(b)(2) to apply, as long as the RSUs are held by the Trustee, the RSUs or the underlying Shares may not be sold, transferred, assigned, pledged or mortgaged (other than through a transfer by will or by operation of law), nor may they be the subject of an attachment or security interest, and no power of attorney or transfer deed shall be given in respect thereof prior to the payment of the tax liability. Upon the conclusion of the Lock-Up Period the Trustee may release the Shares issued hereunder to the Employee only after (i) the receipt by the Trustee of an acknowledgment from the Israeli Income Tax Authority that the Employee has paid all applicable tax due pursuant to the Israeli Tax Ordinance and Section 102, or (ii) the Trustee withholds any applicable tax due pursuant to the Israeli Tax Ordinance and Section 102. Notwithstanding the foregoing, in the event the Employee shall elect to release the Shares prior to the conclusion of the Lock-up Period, the sanctions under Section 102 shall apply to and shall be borne solely by the Employee.
(c) The Employee understands that in the event of a distribution of rights, including an issuance of stock dividend or bonus shares, in connection with the RSU (the “Additional Rights”), all such Additional Rights shall be deposited with and/or issued to the Trustee for the benefit of the Employee, and shall also be subject to the provisions of Section 102(b)(2). The Lock-Up Period for such Additional Rights shall be measured from the commencement of the Lock-Up Period of the RSU to be issued hereunder, from which the Additional Rights were declared or distributed.
Death of the Employee
The following provision supplements Section 9 of the Grant Agreement:
As long as the Shares are held by the Trustee for the benefit of the Employee, all rights of the Employee over the Shares cannot be transferred, assigned, pledged or mortgaged, other than by will or laws of descent and distribution.
* * * * *
TO BE SIGNED BY THE ISRAELI EMPLOYEE WITH A COPY RETURNED TO PAYROLL ADMINISTRATION:
I have read and understood this Grant Agreement, including this Appendix. I understand that the rights granted and the Shares issued to me under this Grant Agreement are subject to the terms and provisions of Section 102(b)(2) of the Israeli Tax Ordinance and its related rules and regulations and I hereby accept such rights and Shares subject to such terms and provisions. I acknowledge that my holding, sale and transfer of the Shares and/or any Additional Rights is therefore subject to various restrictions and limitations that are imposed by such Section and its related rules and regulations, of which I am aware and with which I agree to comply.
ITALY
Plan Document Acknowledgment
The Employee acknowledges having read and specifically and expressly approves the following sections of the Grant Agreement: Section 2 (“Vesting Schedule”), Section 4 (“Restrictions”), Section 5 (“Custody of Restricted Stock Units”), Section 11 (“Taxes”), Section 13 (“Plan Information”), Section 14 (“Acknowledgment and Waiver”), Section 15 (“No Advice Regarding Grant”), Section 17(k) and (l) (“Notices”), Section 17(d) (“Language”), Section 17(i) (“Appendix), Section 17(j) (“Imposition of Other Requirements”) and the Data Privacy Notice below.
Data Privacy Notice
Notwithstanding Section 12 or any other provision of the Grant Agreement, the Employee agrees that the following shall apply with regard to data privacy in Italy:
The Employee understands that the Employer, the Company and any of its other Subsidiaries and Affiliates may collect, use, transfer and hold certain personal information about the Employee, including, the Employee’s name, home address and telephone number, date of birth, social insurance number or other identification number, salary, nationality, job title, any Shares or directorships held in the Company, details of the award of RSUs or any other entitlement to Shares awarded,
17
canceled, exercised, vested, unvested or outstanding in the Employee’s favor (“Data”), for the exclusive purpose of managing and administering the Plan.
The Employee also understands that providing the Company with the Data is necessary for the performance of the Plan and without such Data it would be impossible for the Company to perform its contractual obligations and may affect the Employee’s ability to participate in the Plan. The Controller of personal data processing is HP Inc., with registered offices at 1501 Page Mill, Palo Alto, California 94304, USA, and, pursuant to Legislative Decree no. 196/2003, its representative in Italy is
[Insert Name of Italian Representative Entity]
with registered offices at [Insert Address]. The Employee understands that Data will not be publicized, but it may be transferred to Merrill Lynch or other third parties, banks, other financial institutions or brokers involved in the management and administration of the Plan. The Employee further understands that the Company and/or its Subsidiaries and Affiliates will transfer Data amongst themselves as necessary for the purpose of implementation, administration and management of the Employee’s participation in the Plan, and that the Company and/or its Subsidiaries and Affiliates may each further transfer Data to third parties assisting the Company in the implementation, administration and management of the Plan, including any requisite transfer to Merrill Lynch or another third party with whom the Employee may elect to deposit any Shares acquired under the Plan. Such recipients may receive, possess, use, retain and transfer the Data in electronic or other form, for the purposes of implementing, administering and managing the Employee’s participation in the Plan. The Employee understands that these recipients may be located in the European Economic Area, or elsewhere, such as the U.S. or Asia. Should the Company exercise its discretion in suspending all necessary legal obligations connected with the management and administration of the Plan, it will delete Data as soon as it has accomplished all the necessary legal obligations connected with the management and administration of the Plan.
The Employee understands that Data processing related to the purposes specified above shall take place under automated or non-automated conditions, anonymously when possible, that comply with the purposes for which Data are collected and with confidentiality and security provisions as set forth by Applicable Laws and regulations, with specific reference to Legislative Decree no. 196/2003.
The processing activity, including communication, the transfer of Data abroad, including outside of the European Union, as herein specified and pursuant to Applicable Laws and regulations, does not require the Employee’s consent thereto as the processing is necessary to performance of contractual obligations related to implementation, administration and management of the Plan. The Employee understands that, pursuant to Section 7 of the Legislative Decree no. 196/2003, the Employee has the right to, including but not limited to, access, delete, update, ask for rectification of Data and estop, for legitimate reasons, the Data processing. Furthermore, the Employee is aware that Data will not be used for direct marketing purposes. In addition, the Data provided can be reviewed and questions or complaints can be addressed by contacting the Employee’s local human resources department.
Foreign Asset / Account Tax Reporting Notice
Italian residents who, at any time during the fiscal year, hold foreign financial assets (such as cash, Shares) which may generate income taxable in Italy are required to report such assets on their annual tax returns or on a special form if no tax return is due. The same reporting duties apply to Italian residents who are beneficial owners of the foreign financial assets pursuant to Italian money laundering provisions, even if they do not directly hold the foreign asset abroad. The Employee is advised to consult his or her personal legal advisor to ensure compliance with applicable reporting requirements.
Foreign Asset Tax Information
The value of the financial assets held outside of Italy by Italian residents is subject to a foreign asset tax. The taxable amount will be the fair market value of the financial assets (
e.g.
, Shares) assessed at the end of the calendar year.
JAPAN
Foreign Asset/Account Reporting Notice
The Employee will be required to report details of any assets held outside of Japan as of December 31 (including any Shares acquired under the Plan) to the extent such assets have a total net fair market value exceeding ¥50,000,000. Such report will be due by March 15 each year. The Employee should consult with his or her personal tax advisor as to whether the reporting obligation applies to the Employee and whether the Employee will be required to report details of any outstanding RSUs, Shares or cash held by the Employee in the report.
KAZAKHSTAN
Securities Law Notice
.
This offer is addressed only to certain eligible employees resident in Kazakhstan with resect to rights to Shares or their cash equivalent). As of the date hereof, the Shares on the New York Stock Exchange under the ticker symbol “HPQ.” The Grant Agreement has not been approved, nor does it need to be approved, by the National Bank of Kazakhstan. The Grant Agreement is intended only for the Employee and is not for general circulation in the Republic of Kazakhstan
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Payout of RSUs in Cash Only
Pursuant to the Company’s discretion under Section 2(ii) of the Plan and notwithstanding the language in Section 3 of the Grant Agreement, due to legal considerations in Kazakhstan, the RSUs granted to Employees in Kazakhstan shall be settled in cash only (less any Tax-Related Items and/or fees) and do not provide any right for the Employee to receive Shares.
Exchange Control Notice
No exchange formalities should apply to the Employee’s participation in the Plan as no consideration will be paid for the RSUs. However, prior to the RSUs vesting the Employee should confirm his or her applicable exchange control obligations with his or her personal advisor.
KENYA
There are no country-specific provisions.
KOREA
Exchange Control Notice
If the Employee receives US$500,000 or more from the sale of Shares or the receipt of dividends or dividend equivalent payments in a single transaction, Korean exchange control laws require the Employee repatriate the proceeds to Korea within 18 months of receipt.
Foreign Asset/Account Reporting Notice
Korean residents must declare all foreign financial accounts (e.g., non-Korean bank accounts, brokerage accounts) based in foreign countries to the Korean tax authority and file a report with respect to such accounts if the value of such accounts exceeds KRW 1 billion (or an equivalent amount in foreign currency).
The Employee should consult with his or her personal tax advisor for additional information about this reporting obligation.
KUWAIT
Securities Law Notice
The Plan does not constitute the marketing or offering of securities in Kuwait pursuant to Law No. 7 of 2010 (establishing the Capital Markets Authority) and its implementing regulations. Offerings under the Plan are being made only to eligible employees of the Company or any Subsidiary or Affiliate.
LATVIA
There are no country-specific provisions.
LEBANON
Securities Law Notification
This Plan does not constitute the marketing or offering of securities in Lebanon pursuant to Law No. 161 (2011), the Capital Markets Law. Offerings under the Plan are being made only to eligible employees of the Company or any Subsidiary or Affiliate.
LITHUANIA
There are no country-specific provisions.
LUXEMBOURG
There are no country-specific provisions.
MACEDONIA
There are no country-specific provisions.
MALAYSIA
Data Privacy Consent
The following provision supplements Section 12 of the Grant Agreement:
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You hereby explicitly and unambiguously consent
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Saya dengan ini secara eksplisit dan tanpa sebarang
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to the collection, use and transfer, in electronic or other form, of your personal information as described in this Agreement by and among, as applicable, the Employer, and the Company and its other Subsidiaries and Affiliates for the exclusive purpose of implementing, administering and managing your participation in the Plan.
You understand that the Company and the Employer may hold certain personal information about you, including, but not limited to, your name, home address and telephone number, date of birth, social insurance number (or any other social or national identification number), salary, nationality, job title, residency status, any Shares or directorships held in the Company, details of all Restricted Stock Units or any other entitlement to Shares awarded, canceled, exercised, vested, unvested or outstanding (the “Data”) for the purpose of implementing, administering and managing your participation in the Plan.
The Data is supplied by the Employer and also by me through information collected in connection with the Agreement and the Plan
.
You understand that the Data may be transferred to the Company or any of its Subsidiaries or Affiliates, or to any third parties assisting in the implementation, administration and management of the Plan, that these recipients may be located in your country or elsewhere, including outside the European Economic Area, and that the recipient’s country (e.g., the United States) may have different data privacy laws and protections than your country. You understand that you may request a list with the names and addresses of any potential recipients of the Data by contacting your local human resources representative [Insert name, phone number, fax and email address of Malaysia contact].
You authorize the recipients to receive, possess, use, retain and transfer the Data, in electronic or other form, for the sole purposes of implementing, administering and managing your participation in the Plan, including any requisite transfer of such Data to a broker or other third party assisting with the administration of the RSUs under the Plan or with whom Shares acquired pursuant to RSUs or cash from the sale of such Shares may be deposited. Furthermore, you acknowledge and understand that the transfer of the Data to the Company or any of its subsidiaries or Affiliates, or to any third parties is necessary for your participation in the Plan.
You understand that the Data will be held only as long as is necessary to implement, administer and manage your participation in the Plan. You understand that you may, at any time, view the Data, request additional information about the storage and processing of the Data, require any necessary amendments to the Data or refuse or withdraw the consents herein by contacting your local human resources representative in writing. Further, you understand that you are providing the consents herein on a purely voluntary basis. If you do not consent, or if you later seek to revoke your consent,
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keraguan mengizinkan pengumpulan, penggunaan dan pemindahan, dalam bentuk elektronik atau lain-lain, data peribadi saya seperti yang diterangkan dalam Perjanjian oleh dan di antara, seperti mana yang terpakai, Majikan, Syarikat dan Syarikat Gabungan Korporat dan syarikat gabungannya untuk tujuan ekslusif bagi melaksanakan, mentadbir dan menguruskan penyertaan saya dalam Pelan.
Saya memahami bahawa Syarikat dan Majikan mungkin memegang maklumat peribadi tertentu tentang saya, termasuk, tetapi tidak terhad kepada, nama saya, alamat rumah dan nombor telefon, tarikh lahir, nombor insurans sosial atau nombor pengenalan lain, gaji, kewarganegaraan, jawatan, status kependudukan, apa-apa syer dalam Saham Biasa atau jawatan pengarah yang dipegang dalam Syarikat, bilangan syer dalam Saham Biasa yang dibeli di bawah Pelan, butir-butir semua hak pembelian atau apa-apa hak lain atas syer dalam Saham Biasa yang dianugerahkan, dibatalkan, dilaksanakan, terletak hak, tidak diletak hak ataupun yang belum dijelaskan bagi faedah saya(“Data”), untuk tujuan eksklusif bagi melaksanakan, mentadbir dan menguruskan Pelan tersebut. Data tersebut dibekalkan oleh Majikan dan juga oleh saya melalui maklumat yang dikumpul berkenaan dengan Perjanjian dan Pelan.
Saya memahami bahawa Data ini akan dipindahkan kepada mana-mana pihak ketiga yang membantu dengan pelaksanaan, pentadbiran dan pengurusan Pelan. Saya memahami bahawa penerima-penerima Data mungkin berada dalam negara saya atau mana-mana tempat lain, dan bahawa negara penerima (contohnya, Amerika Syarikat) mungkin mempunyai undang-undang privasi data dan perlindungan yang berbeza daripada negara saya. Saya memahami bahawa saya boleh meminta satu senarai yang mengandungi nama dan alamat penerima-penerima Data yang berpotensi dengan menghubungi wakil sumber manusia tempatan
[Insert name, phone number, fax and email address of Malaysia contact].
Saya memberi kuasa kepada penerima-penerima tersebut untuk menerima, memiliki, menggunakan, mengekalkan dan memindahkan Data, dalam bentuk elektronik atau lain-lain, semata-mata dengan tujuan untuk melaksanakan, mentadbir dan menguruskan penyertaan saya dalam Pelan, termasuklah apa-apa pemindahan yang diperlukan untuk Data tersebut sebagaimana yang diperlukan oleh broker atau mana-mana pihak ketiga yang membantu untuk melaksanakan hak pembelian saya di bawah Pelan atau dengan sesiapa syer Saham Biasa yang diperoleh di atas pelaksanaan hak pembelian ini atau wang tunai daripada penjualan saham tersebut boleh didepositkan. Saya memahami bahawa Data hanya akan disimpan untuk tempoh yang perlu bagi melaksanakan, mentadbir, dan menguruskan penyertaan saya dalam Pelan. Saya memahami bahawa saya boleh, pada bila-bila masa, melihat Data, meminta maklumat tambahan mengenai penyimpanan dan pemprosesan Data, meminta bahawa pindaan-pindaan dilaksanakan ke atas Data atau menolak atau menarik balik persetujuan dalam ini, dalam mana-mana kes, tanpa kos, dengan menghubungi secara bertulis wakil sumber manusia
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your employment status or service and career with the Employer will not be affected; the only adverse consequence of refusing or withdrawing your consent is that the Company would not be able to grant RSUs or other equity awards to you, or administer or maintain such awards. Therefore, you understand that refusing or withdrawing your consent may affect your ability to vest in or realize benefits from RSUs and your ability to participate in the Plan. For more information on the consequences of your refusal to consent or withdrawal of consent, you understand that you may contact your local human resources representative.
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tempatan. Selanjutnya, saya memahami bahawa saya memberikan persetujuan di sini secara sukarela. Jika saya tidak bersetuju, atau jika saya kemudian membatalkan persetujuan saya, status pekerjaan atau perkhidmatan dan kerjaya saya dengan Majikan tidak akan terjejas; satu-satunya akibat buruk jika saya tidak bersetuju atau menarik balik persetujuan saya adalah bahawa Syarikat tidak akan dapat memberikan hak pembelian di bawah Pelan atau anugerah-anugerah ekuiti yang lain kepada saya atau mentadbir atau mengekalkan anugerah tersebut. Oleh itu, saya memahami bahawa keengganan atau penarikan balik persetujuan saya boleh menjejaskan keupayaan saya untuk mengambil bahagian dalam Pelan. Untuk maklumat lanjut mengenai akibat keengganan saya untuk memberikan keizinan atau penarikan balik keizinan, saya memahami bahawa saya boleh menghubungi wakil sumber manusia tempatan.
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Director Reporting Notice
If the Employee is a director of a Malaysian Subsidiary or Affiliate, the Employee is subject to certain notification requirements under the Malaysian Companies Act 1965. Among these requirements is an obligation to notify the Malaysian Subsidiary or Affiliate in writing when the Employee receives or disposes of an interest (
e.g
., RSUs or Shares) in the Company or any related company. This notification must be made within 14 days of receiving or disposing of any interest in the Company or any related company.
MALTA
Payout of RSUs in Cash Only
Pursuant to the Company’s discretion under Section 2(ii) of the Plan and notwithstanding the language in Section 3 of the Grant Agreement, due to legal considerations in Malta, the RSUs granted to Employees in Malta shall be settled in cash only (less any Tax-Related Items and/or fees) and do not provide any right for the Employee to receive Shares.
Securities Law Notice
The Plan, the Grant Agreement (including this Appendix) and all other materials the Employee may receive regarding participation in the Plan do not constitute advertising of securities in Malta and are deemed accepted by the Employee upon receipt of the Employee’s electronic or written acceptance in the United States. The issuance of Shares under the Plan has not and will not be registered in Malta and, therefore, the Shares described in any Plan documents may not be offered or placed in public circulation in Malta.
In no event will Shares issued upon settlement of the RSUs be delivered to the Employee in Malta. All Shares issued upon settlement of the RSUs will be maintained on the Employee’s behalf in the United States.
MAURITIUS
There are no country-specific provisions.
MEXICO
The following provisions supplement Section 14 of the Grant Agreement:
Labor Law Acknowledgment
By accepting the RSUs, the Employee acknowledges that he or she understands and agrees that:
(i) the RSUs are not related to the salary and other contractual benefits granted to the Employee by the Employer; and (ii) any modification of the Plan or its termination shall not constitute a change or impairment of the terms and conditions of employment.
Policy Statement
The invitation the Company is making under the Plan is unilateral and discretionary and, therefore, the Company reserves the absolute right to amend it and discontinue it at any time without any liability to the Employee.
The Company, with its registered office at 1501 Page Mill, Palo Alto, California 94304, USA., is solely responsible for the administration of the Plan. Participation in the Plan and the acquisition of Shares does not, in any way, establish an employment relationship between the Employee and the Company since the Employee is participating in the Plan on a wholly commercial basis and the sole employer is the Employer, nor does it establish any rights between the Employee and Employer.
21
Plan Document Acknowledgment
By accepting the
RSUs, the Employee acknowledges he/she has received a copy of the Plan, has reviewed the Plan and the Grant Agreement in their entirety and fully understands and accepts all provisions of the Plan and the Grant Agreement.
In addition, by signing below, the Employee further acknowledges that having read and specifically and expressly approved the terms and conditions in Section 14 of the
Grant Agreement, in which the following is clearly described and established: (i) participation in the Plan does not constitute an acquired right; (ii) the Plan and participation in the Plan is offered by the Company on a wholly discretionary basis; (iii) participation in the Plan is voluntary; and (iv) the Company, its Subsidiaries and its Affiliates are not responsible for any decrease in the value of the Shares underlying the RSUs.
Finally, the Employee does not reserve any action or right to bring any claim against the Company for any compensation or damages as a result of participation in the Plan and the Employee therefore grants a full and broad release to his/her Employer and the Company and its other Subsidiaries and Affiliates with respect to any claim that may arise under the Plan.
Spanish Translation
Las siguientes disposiciones complementan la Sección 14 del Acuerdo de Otorgamiento:
Reconocimiento de la Ley Laboral
Al aceptar las Unidades de Acciones, el Empleado reconoce que entiende y acepta que:
(i) las Unidades de Acciones no se encuentran relacionadas con el salario ni con otras prestaciones contractuales concedidas al Empleado por parte del Empleador; y (ii) cualquier modificación del Plan o su terminación no constituye un cambio o desmejora de los términos y condiciones de empleo.
Declaración de Política
La invitación por parte de la Compañía bajo el Plan, es unilateral y discrecional; por lo tanto, la Compañía se reserva el derecho absoluto de modificar el mismo y discontinuarlo en cualquier tiempo, sin ninguna responsabilidad para el Empleado.
La Compañía, con oficinas registradas ubicadas en
1501 Page Mill, Palo Alto, California 94304, USA
es la única responsable de la administración del Plan y de la participación en el mismo y la adquisición de Acciones Comunes no establece de forma alguna, una relación de trabajo entre el Empleado y la Compañía, ya que la participación del Empleado en el Plan es completamente comercial y el único empleador es el Empleador, así como tampoco establece ningún derecho entre el Empleado y su Empleador.
Reconocimiento del Documento del Plan
Por medio de la aceptación las Unidades de Acciones, el Empleado reconoce que ha recibido una copia del Plan, que el mismo ha sido revisado al igual que la totalidad del Acuerdo de Otorgamiento y, que ha entendido y aceptado completamente todas las disposiciones contenidas en el Pan y en el Acuerdo de Otorgamiento.
Adicionalmente, al firmar abajo, el Empleado reconoce que ha leído, y que aprueba específica y expresamente los términos y condiciones contenidos en la Sección 14 del Acuerdo, en la cual se encuentra claramente descrito y establecido que: (i) la participación en el Plan no constituye un derecho adquirido; (ii) el Plan y la participación en el mismo es ofrecida por la Compañía de forma enteramente discrecional; (iii) la participación en el Plan es voluntaria; y (iv) la Compañía, así como sus Subsidiarias y Afiliadas no son responsables por cualquier detrimento en el valor de las Acciones Comunes en relación con las Unidades de Acciones.
Finalmente, el Empleado declara que no se reserva ninguna acción o derecho para interponer una demanda en contra de la Compañía por compensación, daño o perjuicio alguno como resultado de su participación en el Plan y en consecuencia, otorga el más amplio finiquito a su Empleador, así como a la Compañía, a sus otras Subsidiarias y Afiliadas con respecto a cualquier demanda que pudiera originarse en virtud del Plan.
MOROCCO
Payout of RSUs in Cash Only
Pursuant to the Company’s discretion under Section 2(ii) of the Plan and notwithstanding the language in Section 3 of the Grant Agreement, due to legal considerations in Morocco, the RSUs granted to Employees in Morocco shall be settled in cash only through local payroll (less any Tax-Related Items and/or fees) and do not provide any right for the Employee to receive Shares.
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NETHERLANDS
Notifications
Securities Law Information
NEW ZEALAND
There are no country-specific provisions.
NIGERIA
There are no country-specific provisions.
NORWAY
There are no country-specific provisions.
PAKISTAN
Exchange Control Notice
The Employee is required immediately to repatriate to Pakistan the proceeds from the sale of Shares or the receipt of any dividends or dividend equivalent payments. The proceeds must be converted into local currency and the receipt of proceeds must be reported to the State Bank of Pakistan (the “SBP”) by filing a “Proceeds Realization Certificate” issued by the bank converting the proceeds with the SBP. The repatriated amounts cannot be credited to a foreign currency account. The Employee should consult his or her personal advisor prior to vesting and settlement of the RSUs to ensure compliance with the applicable exchange control regulations in Pakistan, as such regulations are subject to frequent change. The Employee is responsible for ensuring compliance with all exchange control laws in Pakistan.
PANAMA
Securities Law Notice
Neither the RSUs nor the Shares that the Employee may acquire under the Plan constitute a public offering of securities, as they are available only to eligible employees of the Company, its Affiliates and its Subsidiaries.
PERU
Securities Law Notice
The grant of RSUs is considered a private offering in Peru; therefore, it is not subject to registration.
Labor Law Acknowledgment
The following provision supplements Section 14 of the Grant Agreement:
By accepting the RSUs, the Employee acknowledges, understands and agrees that the RSUs are being granted
ex gratia
to the Employee with the purpose of rewarding him or her.
PHILIPPINES
Issuance of Shares of Common Stock
Employee acknowledges, understands and agrees that, if the issuance of Shares on the vesting date does not comply with all applicable Philippines securities laws, Shares will not be issued. In particular, Shares will not be issued unless and until the Philippines Securities and Exchange Commission authorizes the issuance of Shares under the Plan by approving the Company’s request for exemption from the securities registration requirement.
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Securities Law Notice
The Employee is permitted to dispose or sell Shares acquired under the Plan provided the offer and resale of the Shares takes place outside of the Philippines through the facilities of a stock exchange on which the Shares listed. The Shares are currently listed on the New York Stock Exchange in the United States under the ticker symbol “HPQ”.
POLAND
Exchange Control Notice
If the Employee holds foreign securities (including Shares) and maintains accounts abroad, the Employee may be required to file certain reports with the National Bank of Poland. Specifically, if the value of securities and cash held in such foreign accounts exceeds PLN 7 million, the Employee must file reports on the transactions and balances of the accounts on a quarterly basis. Further, any fund transfers into or out of Poland in excess of €15,000 must be effected through a bank in Poland. Polish residents are required to store all documents related to foreign exchange transactions for a period of five years.
PORTUGAL
Exchange Control Notice
If the Employee holds Shares upon vesting of the RSUs, the acquisition of Shares should be reported to the Banco de Portugal for statistical purposes. If the Shares are deposited with a commercial bank or financial intermediary in Portugal, such bank or financial intermediary will submit the report on the Employee’s behalf. If the Shares are not deposited with a commercial bank or financial intermediary in Portugal, the Employee is responsible for submitting the report to the Banco de Portugal.
Language Consent
The Employee hereby expressly declares that he or she has full knowledge of the English language and has read, understood and fully accepted and agreed with the terms and conditions established in the Plan and Grant Agreement.
Consentimento sobre Língua
O Empregado Contratado, pelo presente instrumento, declara expressamente que domina a língua inglesa e que leu, compreendeu e livremente aceitou e concordou com os termos e condições estabelecidos no Plano e no Acordo de Atribuição.
PUERTO RICO
There are no country-specific provisions.
QATAR
There are no country-specific provisions.
ROMANIA
Exchange Control Notice
If the Employee deposits the proceeds from the sale of Shares issued to him or her at vesting and settlement of the Shares or any cash dividends or dividend equivalent payments in a bank account in Romania, the Employee may be required to provide the Romanian bank with appropriate documentation explaining the source of the funds.
The Employee should consult his or her personal advisor to determine whether the Employee will be required to submit such documentation to the Romanian bank.
RUSSIA
Payout of RSUs in Cash Only
Pursuant to the Company’s discretion under Section 2(ii) of the Plan and notwithstanding the language in Section 3 of the Grant Agreement, the RSUs granted to Employees in Russia shall be settled in cash only paid through local payroll (less any Tax-Related Items and/or fees) and do not provide any right for the Employee to receive Shares.
Compliance with Laws and Regulations
This provision supplements Section 14 of the Grant Agreement:
By accepting this grant of RSUs, the Employee understands, acknowledges and agrees that:
(a)
To participate in the Plan, Employee must comply with all Applicable Laws and regulations in Russia.
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(b)
A copy of this Grant Agreement has been sent to the Employee by the Company as an offer from the territory of the United States of America and by agreeing to accept the RSUs, this Grant Agreement shall be deemed to have been concluded at the location of the Company at the following address: 1501 Page Mill, Palo Alto, California, 94304, USA.
(c)
All actions and proceedings seeking to enforce any provision of, or based on any right arising out of, this Grant Agreement must be brought against either of the parties in the courts of the State of Delaware, County of New Castle, or, if it has or can acquire jurisdiction, in the United States District Court for the District of Delaware, and each of the parties consents to the exclusive jurisdiction of such courts (and of the appropriate appellate courts) in any such action or proceeding and waives any objection to venue laid therein.
(d)
The Employee will comply with the Russian foreign exchange legislation in force at the relevant time.
(e)
The Employee will be solely responsible for (i) the proper declaration of all income received in accordance with the Plan and (ii) the payment of all relevant Tax-Related Items in connection with the receipt of such income as required by applicable Russian law.
(f)
The Employee agrees to execute such further instruments and to take such other action as may be necessary to facilitate his or her participation in the Plan.
Data Privacy Acknowledgement
The Employee hereby acknowledges that he or she has read and understood the terms regarding collection, processing and transfer of Data contained in Section 12 of the Grant Agreement and by participating in the Plan, the Employee agrees to such terms. In this regard, upon request of the Company or the Employer, the Employee agrees to provide an executed data privacy consent form to the Employer or the Company (or any other agreements or consents that may be required by the Employer or the Company) that the Company and/or the Employer may deem necessary to obtain under the data privacy laws in the Employee’s country, either now or in the future. The Employee understands that he or she will not be able to participate in the Plan if the Employee fails to execute any such consent or agreement.
Exchange Control Notice
Under current exchange control regulations, within a reasonably short time after receiving any cash proceeds under the Plan,
the Employee must repatriate such amounts to Russia. Such cash proceeds must be initially credited to the Employee through a foreign currency account at an authorized bank in Russia. After the proceeds are initially received in Russia, they may be further remitted to foreign banks subject to the following limitations: (i) the foreign account may be opened only for individuals; (ii) the foreign account may not be used for business activities; and (iii) the Russian tax authorities must be given notice about the opening/ closing of each foreign account within one month of the account opening/closing. Effective August 2014, dividends (but not dividend equivalents) do not need to be remitted to the Employee’s bank account in Russia but may be remitted directly to a foreign individual bank account (in any Organisation for Economic Cooperation and Development or Financial Action Task Force countries).
The Employee is encouraged to contact his or her personal advisor before remitting proceeds from participation in the Plan to Russia as exchange control requirements may change.
Securities Law Notice
This Appendix, the Grant Agreement, the Plan and all other materials that the Employee may receive regarding participation in the Plan do not constitute advertising or an offering of securities in Russia. The issuance of securities pursuant to the Plan has not and will not be registered in Russia; hence, the securities described in any Plan-related documents may not be used for offering or public circulation in Russia.
SENEGAL
Tax Registration Notice
The Employee is required to submit a copy of this Grant Agreement to the tax authorities within one (1) month of date the RSUs are granted and to pay any applicable registration fee. It is the Employee’s responsibility to submit the registration and pay the fee.
SERBIA AND MONTENEGRO
Securities Law Notice
The grant of Stock Options is not subject to the regulations concerning public offers and private placements under the Law on Capital Markets.
Exchange Control Notice
Pursuant to the Law on Foreign Exchange Transactions, Serbian residents may freely acquire Shares under the Plan. However, the National Bank of Serbia generally requires residents to report the acquisition of Shares, the value of the Shares at vesting and, on a quarterly basis, any changes in the value of the underlying Shares. An exemption from this reporting obligation may apply on the basis that the Shares are acquired for no consideration. The Employee is advised to consult with his or her personal legal advisor to determine the Employee’s reporting obligations upon the acquisition of Shares under the Plan as such obligations are subject to change based on the interpretation of applicable regulations by the National Bank of Serbia.
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SINGAPORE
Payout of RSUs in Cash Only for Mobile Employees
Pursuant to the Company’s discretion under Section 2(ii) of the Plan and notwithstanding the language in Section 3 of the Grant Agreement, if the Employee is designated by the Company as a mobile employee, the RSUs granted to Employees in Singapore shall be settled in cash only (less any Tax-Related Items and/or fees) and do not provide any right for the Employee to receive Shares.
Securities Law Notice
The grant of RSUs is being made to the Employee in reliance on the “Qualifying Person” exemption under section 273(1)(f) of the Singapore Securities and Futures Act (Chapter 289, 2006 Ed.) (“SFA”) and not being made with the view to the underlying Shares being subsequently offered for sale to any other party. The Plan has not been lodged or registered as a prospectus with the Monetary Authority of Singapore. The Employee should note that the RSUs are subject to section 257 of the SFA and the Employee should not make any subsequent sale directly to any person in Singapore, or any offer of such subsequent sale of the Shares underlying the RSUs, unless such sale or offer in Singapore is made (i) after six months from the Grant Date or (ii) pursuant to the exemptions under Part XIII Division (1) Subdivision (4) (other than section 280) of the SFA.
Chief Executive Officer and Director Reporting Notice
If the Employee is the Chief Executive Officer (“CEO”) or a director, associate director or shadow director of the Company’s Singapore Subsidiary or Affiliate, he or she is subject to certain notification requirements under the Singapore Companies Act. Among these requirements is an obligation to notify the Company’s Singapore Subsidiary or Affiliate in writing when the Employee receives an interest (
e.g.
, RSUs or Shares) in the Company or any Subsidiary or Affiliate. In addition, the Employee must notify the Company’s Singapore Subsidiary or Affiliate when he or she sells Shares (including when the Employee sells Shares issued upon vesting and settlement of the RSUs). These notifications must be made within two business days of acquiring or disposing of any interest in the Company or any Subsidiary or Affiliate. In addition, a notification of the Employee’s interests in the Company or any Subsidiary or Affiliate must be made within two business days of becoming the CEO or, director, associate director or shadow director.
SLOVAKIA
Foreign Asset/Account Reporting Notice
If the Employee
permanently resides in the Slovak Republic and, apart from being employed, carries on business activities as an independent entrepreneur (in Slovakian,
podnikatel
), the Employee will be obligated to report his or her foreign assets (including any foreign securities) to the National Bank of Slovakia (provided that the value of the foreign assets exceeds an amount of €2,000,000). These reports must be submitted on a monthly basis by the 15
th
day of the respective calendar month, as well as on a quarterly basis by the 15
th
day of the calendar month following the respective calendar quarter, using notification form DEV (NBS) 1-12, which may be found at the National Bank of Slovakia’s website at www.nbs.sk.
SLOVENIA
Foreign Asset/Account Reporting Information.
Slovenian residents may be required to report the opening of bank and/or brokerage accounts to tax authorities within 15 days of opening such account. The Employee should consult with his or her personal tax advisor to determine whether this requirement will be applicable to any accounts opened in connection with the Employee’s participation in the Plan (e.g., the Employee’s brokerage account with the Company’s designated broker).
SOUTH AFRICA
Payout of RSUs in Cash Only
Pursuant to the Company’s discretion under Section 2(ii) of the Plan and notwithstanding the language in Section 3 of the Grant Agreement, due to exchange control restrictions in South Africa, the RSUs granted to Employees in South Africa shall be settled in cash only (less any Tax-Related Items and/or fees) and do not provide any right for the Employee to receive Shares.
Exchange Control Notice
Because no transfer of funds from South Africa is required under the RSUs, no filing or reporting requirements should apply when the RSUs are granted or when a payment is received upon vesting and settlement of the RSUs. However, because the exchange control regulations are subject to change, the Employee should consult his or her personal advisor prior to vesting and settlement of the RSUs to ensure compliance with current regulations. The Employee is responsible for ensuring compliance with all exchange control laws in South Africa.
Tax Reporting Notice
By accepting the RSUs, the Employee agrees to notify the Employer of the amount of income realized at vesting of the RSUs. If the Employee fails to advise the Employer of the income at vesting, he or she may be liable for a fine. The Employee will be responsible for paying any difference between the actual tax liability and the amount withheld.
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SPAIN
Acknowledgment and Waiver
The following provisions supplement Section 14 of the Grant Agreement:
By accepting the grant of RSUs, the Employee acknowledges that he or she consents to participation in the Plan and has received a copy of the Plan.
The Employee understands that the Company has unilaterally, gratuitously and discretionally decided to grant RSUs under the Plan to individuals who may be employees of the Company or its Subsidiaries or Affiliates throughout the world. The decision is a limited decision that is entered into upon the express assumption and condition that any grant will not economically or otherwise bind the Company or any of its Subsidiaries or Affiliates on an ongoing basis except as provided in the Plan. Consequently, the Employee understands that the RSUs are granted on the assumption and condition that the RSUs or the Shares acquired upon vesting shall not become a part of any employment contract (either with the Company or any of its Subsidiaries or Affiliates) and shall not be considered a mandatory benefit, salary for any purposes (including severance compensation) or any other right whatsoever. In addition, the Employee understands that this grant would not be made to the Employee but for the assumptions and conditions referred to above; thus, the Employee acknowledges and freely accepts that should any or all of the assumptions be mistaken or should any of the conditions not be met for any reason, then the RSUs shall be null and void.
The RSUs are a conditional right to Shares and can be forfeited in the case of, or affected by, the Employee’s termination of service or employment. This will be the case, for example, even if (1) the Employee is considered to be unfairly dismissed without good cause; (2) the Employee is dismissed for disciplinary or objective reasons or due to a collective dismissal; (3) the Employee terminates employment or service due to a change of work location, duties or any other employment or contractual condition; (4) the Employee terminates employment or service due to unilateral breach of contract of the Company, the Employer, or any other Subsidiary or Affiliate; or (5) the Employee’s employment or service terminates for any other reason whatsoever, except for reasons specified in the Grant Agreement. Consequently, upon termination of the Employee’s employment or service for any of the reasons set forth above, the Employee may automatically lose any rights to the unvested RSUs granted to him or her as of the date of the Employee’s termination of employment, as described in the Plan and the Grant Agreement.
Exchange Control Notice
The Employee must declare the acquisition of Shares to the
Dirección General de Comercial e Inversiones
(the “DGCI”) of the
Ministerio de Economia
for statistical purposes. The Employee must also declare ownership of any Shares by filing a D-6 form with the DGCI each January while the Shares are owned. In addition, if the Employee wishes to import the ownership title of any Shares (
i.e.,
share certificates) into Spain, he or she must declare the importation of such securities to the DGCI.
When receiving foreign currency payments derived from the RSUs or ownership of Shares (
i.e.
, cash dividends, dividend equivalent payments or sale proceeds) in excess of €50,000, the Employee must inform the financial institution receiving the payment of the basis upon which such payment is made. The Employee will need to provide the financial institution with the following information: (i) the Employee’s name, address and fiscal identification number; (ii) the name and corporate domicile of the Company; (iii) the amount of the payment; (iv) the currency used; (v) the country of origin; (vi) the reasons for the payment; and (vii) additional information that may be required.
The Employee is required to declare electronically to the Bank of Spain any securities accounts (including brokerage accounts held abroad), as well as the Shares held in such accounts if the value of the transactions during the prior tax year or the balances in such accounts as of December 31 of the prior tax year exceed €1,000,000.
Securities Law Notice
The grant of RSUs and the Shares issued pursuant to the vesting of the RSUs are considered a private placement outside of the scope of Spanish laws on public offerings and issuances of securities.
Foreign Asset/Account Reporting Notice
To the extent that the Employee holds Shares and/or has bank accounts outside Spain with a value in excess of €50,000 (for each type of asset) as of December 31, the Employee will be required to report information on such assets on his or her tax return (tax form 720) for such year. After such Shares and/or accounts are initially reported, the reporting obligation will apply for subsequent years only if the value of any previously-reported Shares or accounts increases by more than €20,000. The reporting must be completed by the following March 31.
SRI LANKA
Payout of RSUs in Cash Only
Pursuant to the Company’s discretion under Section 2(ii) of the Plan and notwithstanding the language in Section 3 of the Grant Agreement, due to legal considerations in Sri Lanka, the RSUs granted to Employees in Sri Lanka shall be settled in cash only through local payroll (less any Tax-Related Items and/or fees) and do not provide any right for the Employee to receive Shares.
Exchange Control Notice
If the Employee holds proceeds in a foreign cash account, the Employee will be required to obtain exchange control approval. The Employee is responsible for ensuring compliance with all exchange control laws in Sri Lanka.
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SWEDEN
There are no country-specific provisions.
SWITZERLAND
Securities Law Notice
The offer of RSUs is not intended to be publicly offered in or from Switzerland. Because the offer of the RSUs is considered a private offering, it is not subject to registration in Switzerland. Neither this document nor any other materials relating to the RSUs constitutes a prospectus as such term is understood pursuant to article 652a of the Swiss Code of Obligations, and neither this document nor any other materials relating to the RSUs may be publicly distributed nor otherwise made publicly available in Switzerland.
TAIWAN
Data Privacy Consent
The Employee hereby acknowledges that he or she has read and understood the terms regarding collection, processing and transfer of Data contained in Section 12 of the Grant Agreement and by participating in the Plan, the Employee agrees to such terms. In this regard, upon request of the Company or the Employer, the Employee agrees to provide an executed data privacy consent form to the Employer or the Company (or any other agreements or consents that may be required by the Employer or the Company) that the Company and/or the Employer may deem necessary to obtain under the data privacy laws in the Employee’s country, either now or in the future. The Employee understands he or she will not be able to participate in the Plan if the Employee fails to execute any such consent or agreement.
Securities Law Notice
The RSUs and the Shares to be issued pursuant to the Plan are available only to employees of the Company, its Subsidiaries and Affiliates. The grant of the RSUs does not constitute a public offer of securities.
Exchange Control Notice
The Employee may acquire and remit foreign currency (including proceeds from the sale of Shares) into and out of Taiwan up to US$5,000,000 per year. If the transaction amount is TWD$500,000 or more in a single transaction, the Employee must submit a foreign exchange transaction form and also provide supporting documentation to the satisfaction of the remitting bank. If the transaction amount is US$500,000 or more in a single transaction, the Employee may be required to provide additional supporting documentation to the satisfaction of the remitting bank. The Employee should consult his or her personal advisor to ensure compliance with applicable exchange control laws in Taiwan.
THAILAND
Exchange Control Notice
When the Employee sells Shares issued upon vesting of the RSUs or receives dividends or dividend equivalent payments, the Employee must repatriate to Thailand any cash proceeds or payments of at least US$50,000 within 360 days from the date the sale transaction was entered into. The Employee must either convert the amounts to local currency or deposit the funds into a foreign currency account within 360 days of repatriation. If the amount of the Employee’s proceeds is US$50,000 or more, the Employee must specifically report the inward remittance to the Bank of Thailand on a foreign exchange transaction form. If the Employee fails to comply with these obligations, the Employee may be subject to penalties assessed by the Bank of Thailand. The Employee should consult his or her personal legal advisor prior to taking any action with respect to the remittance of proceeds into Thailand. The Employee is responsible for ensuring compliance with all exchange control laws in Thailand.
TUNISIA
Payout of RSUs in Cash Only
Pursuant to the Company’s discretion under Section 2(ii) of the Plan and notwithstanding the language in Section 3 of the Grant Agreement, due to legal considerations in Tunisia, the RSUs granted to Employees in Tunisia shall be settled in cash only through local payroll (less any Tax-Related Items and/or fees) and do not provide any right for the Employee to receive Shares.
Exchange Control Acknowledgement
If the Employee is a resident of Tunisia, he or she acknowledges, consents and agrees to comply with exchange control requirements with respect to the RSU and to obtain any necessary approval from the Central Bank of Tunisia. If the Employee holds assets (including Shares acquired under the Plan) outside Tunisia and the value of such assets exceeds a certain threshold (currently TND 500), the Employee must declare the assets to the Central Bank of Tunisia within six months of their acquisition. All proceeds from the RSUs, the Shares and the sale of Shares must be repatriated to Tunisia. The Employee should consult his or her personal advisor before taking action with respect to remittance of proceeds into Tunisia.
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TURKEY
Securities Law Notice
Under Turkish law, the Employee is not permitted to sell any Shares acquired under the Plan in Turkey. The Shares are currently traded on the New York Stock Exchange, which is located outside of Turkey, under the ticker symbol “HPE” and Shares acquired under the Plan may be sold through this exchange.
Exchange Control Notice
Under Turkish law, Turkish residents are permitted to purchase and sell securities or derivatives traded on exchanges abroad only through a financial intermediary licensed in Turkey. Therefore, the Employee may be required to appoint a Turkish broker to assist the Employee with the sale of the Shares acquired under the Plan.
UKRAINE
Payout of RSUs in Cash Only
Pursuant to the Company’s discretion under Section 2(ii) of the Plan and notwithstanding the language in Section 3 of the Grant Agreement, due to exchange control restrictions in the Ukraine, the RSUs granted to Employees in the Ukraine shall be settled in cash only paid through local payroll (less any Tax-Related Items and/or fees) and do not provide any right for the Employee to receive Shares.
Exchange Control Notice
The Employee understands that the Employee is responsible for complying with applicable exchange control regulations in Ukraine. The Employee should consult a legal advisor regarding his or her participation in the Plan.
UNITED ARAB EMIRATES
Securities Law Notice
The Plan is being offered only to qualified employees and is in the nature of providing equity incentives to employees of the Company or its Subsidiary in the UAE. Any documents related to the Plan, including the Plan, this Appendix, the Plan prospectus and other grant documents (“Plan Documents”), are intended for distribution only to such employees and must not be delivered to, or relied on by any other person. Prospective recipients of the securities offered (i.e., the RSUs) should conduct their own due diligence on the securities.
The Emirates Securities and Commodities Authority has no responsibility for reviewing or verifying any Plan Documents nor has it taken steps to verify the information set out in them, and thus, is not responsible for such documents. Further, neither the Ministry of Economy nor the Dubai Department of Economic Development has approved this statement nor taken steps to verify the information set out in it, and has no responsibility for it.
Employees should, as prospective stockholders, conduct their own due diligence on the securities. If the Employee does not understand the contents of the Plan Documents, he or she should consult an authorized financial adviser.
UNITED KINGDOM
Payout of RSUs in Shares Only
Pursuant to its discretion under Section 2(ii) of the Plan,
with respect to all Employees residing in the United Kingdom, the Company will convert all vested RSUs only into an equivalent number of Shares. Employees residing in the United Kingdom (or in the event of death, such Employee’s legal representative) will not receive an equivalent cash payment with respect to vested RSUs.
UZBEKISTAN
Payout of RSUs in Cash Only
Pursuant to the Company’s discretion under Section 2(ii) of the Plan and notwithstanding the language in Section 3 of the Grant Agreement, due to exchange control restrictions in Uzbekistan, the RSUs granted to Employees in Uzbekistan shall be settled in cash only (less any Tax-Related Items and/or fees) and do not provide any right for the Employee to receive Shares.
Exchange Control Notice
All proceeds from the vesting of the RSUs are required to be repatriated to Uzbekistan via a U.S. dollar account at a Uzbek bank.
VENEZUELA
Investment Representation
As a condition of the grant of RSUs, the Employee acknowledges and agrees that any Shares the Employee may acquire upon the vesting of the RSUs are acquired as and intended to be an investment rather than for the resale of the Shares and conversion of Shares into foreign currency.
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Securities Law Notice
The RSUs granted under the Plan and the Shares issued under the Plan are offered as a personal, private, exclusive transaction and are not subject to Venezuelan government securities regulations.
Exchange Control Notice
Exchange control restrictions may limit the ability to vest in the RSUs or to remit funds into Venezuela following the sale of Shares acquired under the Plan. The Company reserves the right to further restrict the settlement of the RSUs or to amend or cancel the RSUs at any time to comply with the applicable exchange control laws in Venezuela. However, ultimately, the Employee is responsible for complying with exchange control laws in Venezuela and neither the Company, the Employer nor any other Subsidiary or Affiliate will be liable for any fines or penalties resulting from the Employee’s failure to comply with Applicable Laws. Because exchange control laws and regulations change frequently and without notice, the Employee should consult with his or her personal legal advisor before accepting the RSUs to ensure compliance with current regulations.
VIETNAM
Payout of RSUs in Cash Only
Pursuant to the Company’s discretion under Section 2(ii) of the Plan and notwithstanding the language in Section 3 of the Grant Agreement, due to exchange control restrictions in Vietnam, the RSUs granted to Employees in Vietnam shall be settled in cash only paid through local payroll (less any Tax-Related Items and/or fees) and do not provide any right for the Employee to receive Shares.
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Exhibit 10(s)(s)
GRANT AGREEMENT [for use from January 1, 2016]
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Name:
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Employee ID:
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Grant Date:
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Grant ID:
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Target Amount:
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Plan:
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Performance-Adjusted Restricted Stock Units
GRANT SUMMARY
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Target Amount
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0 Shares
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Performance Period
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01 November 2015 – 31 October 2018
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Segment 1
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01 November 2015 – 31 October 2017
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Segment 2
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01 November 2015 – 31 October 2018
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THIS PERFORMANCE-ADJUSTED RESTRICTED STOCK UNITS GRANT AGREEMENT (this “Grant Agreement”), as of the Grant Date noted above between HP Inc., a Delaware Corporation (“Company”), and the employee named above (“Employee”), is entered into as follows:
WHEREAS, the continued participation of the Employee is considered by the Company to be important for the Company’s continued growth; and
WHEREAS, in order to give the Employee an incentive to continue in the employ of the Company (or its Affiliates or Subsidiaries), to accept ancillary agreements designed to protect the legitimate business interests of the Company that are made a condition of this grant and to participate in the affairs of the Company, the HR and Compensation Committee of the Board of Directors of the Company or its delegates (“Committee”) has determined that the Employee shall be granted performance-adjusted restricted stock units (“PARSUs”) representing hypothetical shares of the Company’s common stock (the “Grant”) and dividend equivalents. The target amount stated above reflects the target number of PARSUs that may be granted to Employee (the “Target Amount”). The number of PARSUs achieved will be determined at the end of each Segment (as defined below). Each PARSU will be equal in value to one share of the Company’s $0.01 par value common stock (“Shares”), subject to the restrictions stated below and in accordance with plan named above (the “Plan”), a copy of which can be found on the Long-term Incentives website
along with a copy of the related prospectus. The Plan and the related prospectus can also be obtained by written or telephonic request to the Company Secretary. Unless otherwise defined in this Grant Agreement, any capitalized terms in this Grant Agreement shall have the meaning ascribed to such terms in the Plan.
THEREFORE, the parties agree as follows:
1.
Grant of Performance-Adjusted Restricted Stock Units.
Subject to the terms and conditions of this Grant Agreement and of the Plan, the Company hereby grants to the Employee a PARSU together with dividend equivalent units, as set forth below.
2.
Performance Criteria and Performance Periods.
The Grant is divided into two separate segments, each with a different performance period, as set forth in the Grant Summary above. 1/2 of the Target Amount of the PARSUs are subject to performance criteria for Segment 1 (defined above), which is two fiscal years (the “Segment 1 Units”) and 1/2 of the Target Amount of the PARSUs are subject to performance criteria for Segment 2 (defined above) which is three fiscal years (the “Segment 2 Units”). Segment 1 and Segment 2 are jointly referred to herein as “Segments”.
For each Segment,
the Employee may be credited with PARSUs based on (a) the Company’s achieving goals for that Segment related to return on invested capital (“ROIC”) (weighted 50% of the PARSUs for each Segment) and relative total shareholder return (“TSR”) (weighted 50% of the PARSUs for each Segment), (b) the Employee’s continued employment through the last U.S. business day of the relevant Segment, and (c) the Employee’s compliance with the requirements and conditions provided for in the Plan and this Grant Agreement.
The goals associated with this PARSU shall be established by the Committee, and will be communicated separately to the Employee by the Company. Shares delivered at the end of each Segment with respect to this PARSU will range from 0% to 200% of the Target Amount of PARSUs, based upon the Company’s performance against the ROIC and TSR goals as certified by the Committee. No PARSUs will be achieved for a segment if performance is below minimum levels.
3.
Crediting of Units For Each Segment.
(a)
ROIC Units. 50% of the Target Amount of units for each Segment (i.e., 25% of the total Target Amount of PARSUs) will be determined based upon performance against the ROIC goals for that Segment, as certified by the Committee (the “Segment ROIC Units”). The relevant number of Segment ROIC Units shall be credited in the Employee’s name, based on the Company’s performance during the relevant Segment as follows: 0% if performance is below minimum level, 50% if performance is at minimum level, 100% if performance is at target level and 200% if performance is at or above maximum level. For performance between the minimum level and target level or between target level and the maximum level, a proportionate percentage will be applied based on straight-line interpolation between levels.
If ROIC goals are met for the relevant Segment, the ROIC Units that are achieved for that Segment will be credited to the Employee even if the TSR goals for the Segment are not met.
(b)
TSR Units. 50% of the Target Amount of units for each Segment (i.e., 25% of the total Target Amount of units) will be determined based upon performance against the TSR goal for that Segment, as certified by the Committee (the “Segment TSR Units”). The Segment TSR Units shall be credited in the Employee’s name based on the Company’s performance during the relevant Segment as follows: 0% if performance is below the minimum level, 50% if performance is at the minimum level, 100% if performance is at target level and 200% if performance is at or above the maximum level. For performance between minimum and target, or between target and the maximum levels, a proportionate percentage will be applied based on straight-line interpolation between levels.
If TSR goals are met for the relevant Segment, the TSR Units that are achieved for that Segment will be credited to the Employee even if the ROIC goals for the Segment are not met.
(c)
Service Requirement. Notwithstanding (a) and (b) above, the Employee must be employed on the last day of the relevant Segment in order to be credited with any PARSUs for that Segment.
4.
Payout of Performance-Adjusted Restricted Stock Units and Dividend Equivalents.
Except as otherwise provided in Sections 9 and 11 below, following the Committee’s certification (if applicable) at the end of the relevant Segment that the goals associated with this PARSU have been met and that the terms and conditions set forth in this Grant Agreement have been fulfilled (and in any event within 75 days of the last day of the relevant Segment), the Company shall deliver to the Employee’s account
(or the Employee’s estate or beneficiary or legal guardian in the event of Sections 9 through 11 below, as applicable) a number of Shares equal to the following:
(a)
a number of Shares corresponding to the number of PARSUs that have become vested pursuant to Section 3 (and Section 9 through 11, as applicable); plus
(b)
a number of Shares corresponding to dividend equivalent payments determined by:
(1)
Multiplying, separately, the number of PARSUs that became vested as determined in Section 3 by the dividend per Share on each dividend payment date between the Grant Date and the date the PARSUs vested to determine the dividend equivalent amount for each applicable dividend payment date; and
(2)
dividing the amount determined in (1) above by the Fair Market Value of a Share on the dividend payment date to determine the number of additional whole and fractional RSUs to be credited to the Employee;
provided, however, that if any aggregated dividend equivalent payments in Section (b)(2) above result in a payment of a fractional Share, such fractional Share shall be rounded up to the nearest whole Share.
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5.
Restrictions.
Except as otherwise provided for in this Grant Agreement, the PARSUs or rights granted hereunder may not be sold, pledged or otherwise transferred.
6.
Custody of Performance-Adjusted Restricted Stock Units.
The PARSUs subject hereto shall be held in a restricted book entry account in the name of the Employee. Upon completion of the relevant Segment, any Shares deliverable pursuant to Section 4 above shall be released into an unrestricted brokerage account in the name of the Employee; provided, however, that a portion of such Shares shall be surrendered in payment of Tax-Related Items in accordance with Section 13 below, unless the Company, in its sole discretion, establishes alternative procedures for the payment of such taxes. Any Shares not deliverable pursuant to Section 4 above shall be forfeited from the Employee’s account.
7.
No Stockholder Rights.
PARSUs represent hypothetical Shares. Until Shares are delivered to the Employee pursuant to the terms of this Grant Agreement, the Employee shall not be entitled to any of the rights or benefits generally accorded to stockholders, including, without limitation, the receipt of dividends.
8.
Termination of Employment.
Except in the case of a termination of employment due to the Employee’s death, retirement or total and permanent disability, the Employee must remain in the employ of the Company on a continuous basis through the last U.S. business day of the relevant Segment in order to be eligible to receive any amount of the PARSU except to the extent a severance plan applicable to the Employee provides otherwise, subject to the terms and conditions of this Grant Agreement.
9.
Benefit in Event of Death of the Employee.
In the event that termination of employment is due to the death of the Employee, all unvested PARSUs shall vest immediately based on deemed attainment of the performance criteria at target levels, including any Shares representing dividend equivalent payments calculated in accordance with Section 4(b), except that the calculation will be based on the number of PARSUs that vest in accordance with this Section 9, and any such Shares representing the vested PARSUs and dividend equivalent payments shall be delivered within 75 days of vesting.
10.
Retirement of the Employee.
If the Employee’s termination is due to retirement in accordance with an applicable retirement policy, a Pro Rata Portion of the PARSUs shall vest. The Company’s obligation to deliver the amounts that vest pursuant to this Section 10 is subject to the condition that (i) the Employee
shall have executed a current Agreement Regarding Confidential Information and Proprietary Developments (“ARCIPD”) that is satisfactory to the Company, and (ii) during the portion of the Performance Period following termination of the Employee’s active employment, the Employee is in compliance with any-post employment restrictions in the ARCIPD and does not engage in any conduct that creates a conflict of interest in the opinion of the Company.
11.
Total and Permanent Disability of the Employee.
In the event that termination of employment is due to the total and permanent disability of the Employee, all unvested PARSUs shall vest immediately based on deemed attainment of the performance criteria at target levels, including any Shares representing dividend equivalent payments calculated in accordance with Section 4(b), except that the calculation will be based on the number of PARSUs that vest in accordance with this Section 11, and any such Shares representing the vested PARSUs and dividend equivalent payments shall be delivered within 75 days of vesting. The Company’s obligation to deliver the amounts that vest pursuant to this Section 11 is subject to the condition that (a) the
Employee shall have executed a current ARCIPD that is satisfactory to the Company, and (b) during the portion of the Performance Period following termination of the Employee’s active employment, the Employee is in compliance with any-post employment restrictions in the ARCIPD and does not engage in any conduct that creates a conflict of interest in the opinion of the Company.
12.
Section 409A.
Payments made pursuant to this Plan and
this Grant Agreement
are intended to comply with or qualify for an exemption from Section 409A of the Code (“Section 409A”). The Company reserves the right, to the extent the Company deems necessary or advisable in its sole discretion, to unilaterally amend or modify the Plan and/or this Grant Agreement or adopt other policies and procedures (including amendments, policies and procedures with retroactive effect), or take any other actions, including any amendments or actions that would result in the reduction of benefits payable under this Grant Agreement, as the Company determines are necessary or appropriate to ensure that all PARSUs and dividend equivalent payments are made in a manner that qualifies for an exemption from, or complies with, Section 409A or mitigate any additional tax, interest and/or penalties or other adverse tax consequences that may apply under Section 409A; provided however, that the Company makes no representations that the PARSU or the dividend equivalents will be exempt from any penalties that may apply under Section 409A and makes no undertaking to preclude Section 409A from applying to this PARSU or the dividend equivalents. For the avoidance of doubt, the Employee hereby acknowledges and agrees that the Company will have no liability to the Employee or any other party if any amounts payable under this Grant Agreement are not exempt from, or compliant with, Section 409A, or for any action taken by the Company with respect thereto. Any PARSUs or dividend equivalents the settlement of which is triggered by “separation from service” (within the meaning of Section 409A) of a “specified employee” (as defined under Section 409A) shall be made on a date that is the earlier of (a) the Employee’s death or (b) the later of the specified settlement date and the date which is six months after the date of the Employee’s separation from service.
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13.
Taxes.
(a)
The Employee shall be liable for any and all taxes, including income tax, social insurance, fringe benefit tax, payroll tax, payment on account, employer taxes or other tax-related items related to the Employee’s participation in the Plan and legally applicable to or otherwise recoverable from the Employee by the Company and/or, if different, the Employee’s employer (the “Employer”) whether incurred at grant, vesting, sale, prior to vesting or at any other time (“Tax-Related Items”). In the event that the Company or the Employer (which, for purposes of this Section 13, shall include a former employer) is required, allowed or permitted to withhold taxes as a result of the grant or vesting of PARSUs (including dividend equivalents) or the issuance or subsequent sale of Shares acquired pursuant to such PARSUs, or due upon receipt of dividend equivalent payments or dividends, the Employee shall surrender a sufficient number of whole Shares, make a cash payment or make adequate arrangements satisfactory to the Company and/or the Employer to withhold such taxes from the Employee’s wages or other cash compensation paid to the Employee by the Company and/or the Employer at the election of the Company, in its sole discretion, or, if permissible under local law, the Company may sell or arrange for the sale of Shares that Employee acquires as necessary to cover all Tax-Related Items that the Company or the Employer has to withhold or that are legally recoverable from the Employee (such as fringe benefit tax) at the time the restrictions on the PARSUs lapse, unless the Company, in its sole discretion, has established alternative procedures for such payment. However, with respect to any PARSUs subject to Section 409A, the Employer shall limit the surrender of Shares to the minimum number of Shares permitted to avoid a prohibited acceleration under Section 409A. The Employee will receive a cash refund for any fraction of a surrendered Share or Shares in excess of any and all Tax-Related Items. To the extent that any surrender of Shares or payment of cash or alternative procedure for such payment is insufficient, the Employee authorizes the Company, its Affiliates and Subsidiaries, which are qualified to deduct tax at source, to deduct from the Employee’s compensation all Tax-Related Items. The Employee agrees to pay any Tax-Related Items that cannot be satisfied from wages or other cash compensation, to the extent permitted by Applicable Law.
To avoid negative accounting treatment, the Company and/or the Employer may withhold or account for Tax-Related Items by considering applicable minimum statutory withholding amounts or other applicable withholding rates, including maximum applicable rates, in which case the Employee will receive a refund of any over-withheld amount in cash and will have no entitlement to the Share equivalent. If the obligation for Tax-Related Items is satisfied by withholding in Shares, for tax purposes, the Employee is deemed to have been issued the full number of Shares subject to the vested PARSUs, notwithstanding that a number of the Shares is held back solely for the purpose of paying the Tax-Related Items due as a result of any aspect of the Employee’s participation in the Plan.
(b)
Regardless of any action the Company or the Employer takes with respect to any or all Tax-Related Items, the Employee acknowledges and agrees that the ultimate liability for all Tax-Related Items is and remains the Employee’s responsibility and may exceed the amount actually withheld by the Company or the Employer. The Employee further acknowledges that the Company and/or the Employer: (i) make no representations nor undertakings regarding the treatment of any Tax-Related Items in connection with any aspect of this grant of PARSUs, including, but not limited to, the grant, vesting or settlement of PARSUs, the subsequent delivery of Shares and/or cash upon settlement of such PARSUs or the subsequent sale of any Shares acquired pursuant to such PARSUs and receipt of any dividends or dividend equivalent payments; and (ii) notwithstanding Section 12, do not commit to and are under no obligation to structure the terms or any aspect of this grant of PARSUs to reduce or eliminate the Employee’s liability for Tax-Related Items or to achieve any particular tax result. Further, if the Employee has become subject to tax in more than one jurisdiction, the Employee acknowledges that the Company and/or the Employer may be required to withhold or account for Tax-Related Items in more than one jurisdiction. The Employee shall pay the Company or the Employer any amount of Tax-Related Items that the Company or the Employer may be required to withhold or account for as a result of the Employee’s participation in the Plan or the Employee’s receipt of PARSUs that cannot be satisfied by the means previously described. The Company may refuse to deliver the benefit described herein if the Employee fails to comply with the Employee’s obligations in connection with the Tax-Related Items.
(c)
In accepting the PARSUs, the Employee consents and agrees that in the event the PARSUs become subject to an employer tax that is legally permitted to be recovered from the Employee, as may be determined by the Company and/or the Employer at their sole discretion, and whether or not the Employee’s employment with the Company and/or the Employer is continuing at the time such tax becomes recoverable, the Employee will assume any liability for any such taxes that may be payable by the Company and/or the Employer in connection with the PARSUs. Further, by accepting the PARSUs, the Employee agrees that the Company and/or the Employer may collect any such taxes from the Employee by any of the means set forth in this Section 13. The Employee further agrees to execute any other consents or elections required to accomplish the above, promptly upon request of the Company.
14.
Data Privacy Consent.
(a)
The Employee hereby explicitly and unambiguously consents to the collection, use and transfer, in electronic or other form, of the Employee’s personal data as described in this Grant Agreement and any other materials by and among, as applicable, the Company, the Employer and its other Subsidiaries and Affiliates for the exclusive purpose of implementing, administering and managing the Employee’s participation in the Plan.
(b)
The Employee understands that the Company, the Employer and its other Subsidiaries and Affiliates may hold certain personal information about the Employee, including, but not limited to, name, home address and telephone number, date of birth, social insurance number or other identification number, salary, nationality, residency, status, job title, any shares of stock or directorships held in the Company, details of all PARSUs, options or any other entitlement to shares of stock granted, canceled, purchased, exercised, vested, unvested or outstanding in the Employee’s favor (“Data”) for the exclusive purpose of implementing, managing and administering the Plan.
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(c)
The Employee understands that Data will be transferred to the Company or one or more stock plan service providers as may be selected by the Company from time to time, which is assisting the Company with the implementation, administration and management of the Plan. The Employee understands that the recipients of the Data may be located in the United States or elsewhere, and that the recipient’s country of operation (e.g., the United States) may have different data privacy laws and protections than the Employee’s country. The Employee understands that if he or she resides outside the United States, the Employee may request a list with the names and addresses of any potential recipients of the Data by contacting his or her local human resources representative. The Employee authorizes the Company and any other possible recipients which may assist the Company (presently or in the future) with implementing, administering and managing the Plan to receive, possess, use, retain and transfer the Data, in electronic or other form, for the sole purposes of implementing, administering and managing the Employee’s participation in the Plan. The Employee understands that Data will be held only as long as is necessary to implement, administer and manage the Employee’s participation in the Plan. The Employee understands that if he or she resides outside the United States, the Employee may, at any time, view Data, request additional information about the storage and processing of Data, require any necessary amendments to Data or refuse or withdraw the consents herein, in any case without cost, by contacting in writing his or her local human resources representative.
(d)
Further, the Employee understands that he or she is providing the consents herein on a purely voluntary basis. If the Employee does not consent, or if the Employee later seeks to revoke his or her consent, the Employee’s employment and career with the Employer will not be affected; the only consequence of refusing or withdrawing the Employee’s consent is that the Company would not be able to grant PARSUs or other equity awards to the Employee or administer or maintain such awards. Therefore, the Employee understands that refusing or withdrawing the consent may affect the Employee’s ability to participate in the Plan. For more information on the consequences of the Employee’s refusal to consent or withdrawal of consent, the Employee understands that he or she may contact his or her local human resources representative.
15.
Plan Information.
The Employee agrees to receive copies of the Plan, the Plan prospectus and other Plan information, including information prepared to comply with Applicable Laws outside the United States, from the Long-term Incentives website and stockholder information, including copies of any annual report, proxy and Form 10-K, from the investor relations section of the Company’s website at www.hp.com. The Employee acknowledges that copies of the Plan, Plan prospectus, Plan information and stockholder information are available upon written or telephonic request to the Company Secretary. The Employee hereby consents to receive any documents related to current or future participation in the Plan by electronic delivery and agrees to participate in the Plan through an on-line or electronic system established and maintained by the Company or a third party designated by the Company.
16.
Acknowledgment and Waiver.
By accepting this grant of PARSUs, the Employee understands, acknowledges and agrees that:
(a)
this Grant Agreement and its incorporated documents reflect all agreements on its subject matters and the Employee is not accepting this Grant Agreement based on any promises, representations or inducements other than those reflected in this Grant Agreement;
(b)
all good faith decisions and interpretations of the Committee regarding the Plan and Awards granted under the Plan are binding, conclusive and final;
(c)
the Plan is established voluntarily by the Company, it is discretionary in nature and may be modified, amended, suspended or terminated by the Company at any time;
(d)
the grant of PARSUs is voluntary and occasional and does not create any contractual or other right to receive future grants of PARSUs or other awards, or benefits in lieu of PARSUs, even if Shares or PARSUs have been granted in the past;
(e)
all decisions with respect to future grants, if any, will be at the sole discretion of the Company;
(f)
the Employee’s participation in the Plan shall not create a right to further employment with the Employer and shall not interfere with the ability of the Employer to terminate the Employee’s employment relationship at any time and it is expressly agreed and understood that employment is terminable at the will of either party;
(g)
the Employee is voluntarily participating in the Plan;
(h)
PARSUs and their resulting benefits are extraordinary items that are outside the scope of the Employee’s employment contract, if any;
(i)
PARSUs and their resulting benefits are not intended to replace any pension rights or compensation;
(j)
PARSUs and their resulting benefits are not part of normal or expected compensation or salary for any purposes, including, but not limited to calculating any severance, resignation, termination, redundancy, dismissal, end of service payments, bonuses, long-service awards, pension or retirement or welfare benefits or similar payments;
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(k)
unless otherwise agreed by the Company, the PARSUs and their resulting benefits are not granted as consideration for, or in connection with, the service the Employee may provide as a director of Subsidiary or Affiliate;
(l)
this grant of PARSUs will not be interpreted to form an employment contract or relationship with the Company, and furthermore, this grant of PARSUs will not be interpreted to form an employment contract with any Subsidiary or Affiliate;
(m)
the future value of the underlying Shares is unknown, indeterminable and cannot be predicted with certainty;
(n)
no claim or entitlement to compensation or damages shall arise from forfeiture of the PARSUs resulting from termination of Employee’s employment (regardless of the reason for such termination and whether or not later found to be invalid or in breach of employment laws in the jurisdiction where the Employee is employed or retained or the terms of the Employee’s employment or service agreement, if any), and in consideration of the grant of the PARSUs to which the Employee is otherwise not entitled, the Employee irrevocably agrees never to institute any claim against the Company, the Employer or any other Subsidiary or Affiliate and releases the Company, the Employer and any other Subsidiary and Affiliate from any such claim; if, notwithstanding the foregoing, any such claim is allowed by a court of competent jurisdiction, then, by participating in the Plan, the Employee shall be deemed irrevocably to have agreed not to pursue such claim and to have agreed to execute any and all documents necessary to request dismissal or withdrawal of such claims;
(o)
the Company, the Employer or any other Subsidiary or Affiliate will not be liable for any foreign exchange rate fluctuation between the Employee’s local currency and the United States dollar that may affect the value of the PARSUs or any amounts due to the Employee pursuant to the settlement of the PARSUs or the subsequent sale of any Shares acquired upon settlement;
(p)
if the Company’s performance is below minimum levels as set forth in this Grant Agreement, no PARSUs or dividend equivalents will vest and no Shares will be delivered to the Employee;
(q)
if the Company determines that the Employee has engaged in misconduct prohibited by Applicable Law or any applicable policy of the Company, as in effect from time to time, or the Company is required to make recovery from the Employee under Applicable Law or a Company policy adopted to comply with applicable legal requirements, then the Company may, in its sole discretion, to the extent it determines appropriate, (i) recover from the Employee the proceeds from PARSUs vested up to three (3) years prior to the Employee’s termination of employment or any time thereafter, (ii) cancel the Employee’s outstanding PARSUs, and (iii) take any other action it deems to be required and appropriate; and
(r)
the delivery of any documents related to the Plan or Awards granted under the Plan, including the Plan, this Grant Agreement, the Plan prospectus and any reports of the Company generally provided to the Company’s stockholders, may be made by electronic delivery. Such means of electronic delivery may include the delivery of a link to a Company intranet or the Internet site of a third party involved in administering the Plan, the delivery of the document via electronic mail or other such means of electronic delivery specified by the Company. The Employee may receive from the Company a paper copy of any documents delivered electronically at no cost to the Employee by contacting the Company in writing in accordance with Section 19(l). If the attempted electronic delivery of any document fails, the Employee will be provided with a paper copy of such document. The Employee may revoke his or her consent to the electronic delivery of documents or may change the electronic mail address to which such documents are to be delivered (if the Employee has provided an electronic mail address) at any time by notifying the Company of such revoked consent or revised electronic mail address in accordance with Section 19(l). The Employee is not required to consent to the electronic delivery of documents.
17.
No Advice Regarding Grant.
The Company is not providing any tax, legal or financial advice, nor is the Company making any recommendations regarding the Employee’s participation in the Plan, or the Employee’s acquisition or sale of the underlying Shares. The Employee is hereby advised to consult with his or her own personal tax, legal and financial advisors regarding his or her participation in the Plan before taking any action related to the Plan
18.
Additional Eligibility Requirements Permitted.
In addition to any other eligibility criteria provided for in the Plan, the Company may require that the Employee execute a separate document agreeing to the terms of a current arbitration agreement and/or a current ARCIPD, each in a form acceptable to the Company and/or that the Employee be in compliance with the ARCIPD throughout the entire Performance Period. If such separate documents are required by the Company and the Employee does not accept them within 75 days of the Grant Date or such other date as of which the Company shall require in its discretion, this PARSU shall be canceled and the Employee shall have no further rights under this Grant Agreement.
19.
Miscellaneous.
(a)
The Company shall not be required to treat as owner of PARSUs and associated benefits hereunder any transferee to whom such PARSUs or benefits shall have been transferred in violation of any of the provisions of this Grant Agreement.
(b)
The parties agree to execute such further instruments and to take such action as may reasonably be necessary to carry out the intent of this Grant Agreement.
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(c)
The Plan is incorporated herein by reference. The Plan and this Grant Agreement constitute the entire agreement of the parties with respect to the subject matter hereof and supersede in their entirety all prior undertakings and agreements of the Company and the Employee with respect to the subject matter hereof, other than the terms of any severance plan applicable to the Employee that provides more favorable vesting, and may not be modified adversely to the Employee’s interest except by means of a writing signed by the Company and the Employee. Notwithstanding the foregoing, nothing in the Plan or this Grant Agreement shall affect the validity or interpretation of any duly authorized written agreement between the Company and the Employee under which an award properly granted under and pursuant to the Plan serves as any part of the consideration furnished to the Employee, including without limitation, any agreement that imposes restrictions during or after employment regarding confidential information and proprietary developments. This Grant Agreement is governed by the laws of the state of Delaware without regard to its conflict of law provisions.
(d)
If the Employee has received this or any other document related to the Plan translated into a language other than English and if the meaning of the translated version is different than the English version, the English version will control.
(e)
The provisions of this Grant Agreement are severable and if any one or more provisions are determined to be illegal or otherwise unenforceable, in whole or in part, the remaining provisions shall nevertheless be binding and enforceable.
(f)
Notwithstanding Section 19(e), the Company’s obligations under this Grant Agreement and the Employee’s agreement to the terms of an arbitration agreement and/or an ARCIPD, if any, are mutually dependent. In the event that the Employee breaches the arbitration agreement or the Employee’s ARCIPD is breached or found not to be binding upon the Employee for any reason by a court of law, then the Company will have no further obligation or duty to perform under the Plan or this Grant Agreement.
(g)
A waiver by the Company of a breach of any provision of this Grant Agreement shall not operate or be construed as a waiver of any other provision of this Grant Agreement, or of any subsequent breach by the Employee or any other Awardee.
(h)
The Employee acknowledges that, depending on his or her country, the Employee may be subject to insider trading restrictions and/or market abuse laws, which may affect the Employee’s ability to acquire or sell Shares or rights to Shares (
e.g.,
PARSUs) under the Plan during such times as the Employee is considered to have “inside information” regarding the Company (as defined by the laws in the Employee’s country). Any restrictions under these laws or regulations are separate from and in addition to any restrictions that may be imposed under any applicable Company insider trading policy. The Employee is responsible for ensuring compliance with any applicable restrictions and is advised to consult his or her personal legal advisor on this matter.
(i)
Notwithstanding any provisions in this Grant Agreement, the grant of the PARSUs shall be subject to any special terms and conditions set forth in the Appendix to this Grant Agreement for the Employee’s country, if any. Moreover, if the Employee relocates to one of the countries included in the Appendix, the special terms and conditions for such country will apply to the Employee, to the extent the Company determines that the application of such terms and conditions is necessary or advisable for legal or administrative reasons. The Appendix, if any, constitutes part of this Grant Agreement.
(j)
The Company reserves the right to impose other requirements on the Employee’s participation in the Plan, on the PARSUs and on any Shares acquired under the Plan, to the extent the Company determines it is necessary or advisable for legal or administrative reasons, and to require the Employee to sign any additional agreements or undertakings that may be necessary to accomplish the foregoing.
(k)
Any notice required or permitted hereunder to the Employee shall be given in writing and shall be deemed effectively given upon delivery to the Employee at the address then on file with the Company.
(l)
Any notice to be given under the terms of this Grant Agreement to the Company will be addressed in care of Attn: Global Equity Administration at HP Inc., 1501 Page Mill, Palo Alto, California 94304, USA.
(m)
The Employee acknowledges that there may be certain foreign asset and/or account reporting requirements which may affect his or her ability to acquire or hold Shares acquired under the Plan or cash received from participating in the Plan (including from any dividends or dividend equivalent payments) in a brokerage or bank account outside the Employee’s country. The Employee may be required to report such accounts, assets or transactions to the tax or other authorities in his or her country. The Employee also may be required to repatriate sale proceeds or other funds received as a result of the Employee’s participation in the Plan to his or her country through a designated bank or broker within a certain time after receipt. The Employee acknowledges that it is his or her responsibility to be compliant with such regulations, and the Employee is advised to consult his or her personal legal advisor for any details.
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HP Inc.
Dion Weisler
CEO and President
Tracy Keogh
Chief Human Resources Officer
RETAIN THIS GRANT AGREEMENT FOR YOUR RECORDS
Important Note:
Your grant is subject to the terms and conditions of this Grant Agreement and to the Company obtaining all necessary government approvals. If you have questions regarding your grant, please discuss them with your manager.
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