Hewlett-Packard Company

Decision

Headnote

National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions -- Application for relief from dealer registration requirements in respect of first trade in shares made in connection with an employee stock purchase plan by a U.S. issuer -- Relief from dealer registration requirements requested upon the first trade of shares through affiliate of plan administrator -- The Filer cannot rely on the plan administrator exemption in subsection 8.16(3) of National Instrument 31-103 Registration Requirements and Exemptions as the Filer is a reporting issuer in a Canadian jurisdiction -- Canadian employees will receive disclosure documents from plan administrator -- The affiliate of the plan administrator that executes first trade of shares is subject to the supervision of the U.S. Securities and Exchange Commission -- Relief granted.

Applicable Legislative Provisions

Securities Act, R.S.O. 1990, c. S.5, as am., ss. 25, 53, 74(1).

Multilateral Instrument 11-102 Passport System, s. 4.7(1).

National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions, s. 3.6(6).

National Instrument 31-103 Registration Requirements and Exemptions, s. 8.16.

National Instrument 45-102 Resale of Securities, ss. 2.6, 2.14.

October 28, 2011

IN THE MATTER OF

THE SECURITIES LEGISLATION OF

ONTARIO

(the Jurisdiction)

AND

IN THE MATTER OF

THE PROCESS FOR EXEMPTIVE RELIEF

APPLICATIONS IN MULTIPLE JURISDICTIONS

AND

IN THE MATTER OF

HEWLETT-PACKARD COMPANY

(the Filer)

DECISION

Background

The principal regulator in the Jurisdiction has received an application from the Filer for a decision under the securities legislation of the Jurisdiction (the Legislation) that the dealer registration requirement not apply to the first trade in common shares of the Filer (Common Shares) issued upon the exercise of Options (defined below) by Eligible Employees (defined below), former such employees or the legal representative of permitted transferees of any of the foregoing pursuant to the Hewlett-Packard Company 2011 Employee Stock Purchase Plan (the HP 2011 Plan) (the Exemption Sought).

Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a passport application):

(a) the Ontario Securities Commission is the principal regulator for this application; and

(b) the Filer has provided notice that section 4.7(1) of Multilateral Instrument 11-102 Passport System (MI 11-102) is intended to be relied on in British Columbia, Alberta, Saskatchewan, Manitoba, Quebec, Nova Scotia, New Brunswick, Prince Edward Island, Newfoundland & Labrador, Yukon Territory, Northwest Territories and Nunavut Territory (with Ontario, the Jurisdictions).

Interpretation

Terms defined in National Instrument 14-101 Definitions and MI 11-102 have the same meaning if used in this decision, unless otherwise defined.

Representations

This decision is based on the following facts represented by the Filer:

1. The Filer is a corporation incorporated under the laws of Delaware and is not a reporting issuer in any jurisdiction in Canada except Québec. The Filer is subject to the reporting requirements of the Securities Exchange Act of 1934.

2. The authorized share capital of the Filer consists of 9,600,000,000 Common Shares with a par value of US$0.01 each and 300,000,000 shares of preferred stock with a par value of US$0.01 each. As at August 31, 2011 there were 1,986,967,186 Common Shares and no shares of preferred stock of the Filer issued and outstanding.

3. The Common Shares are listed on the New York Stock Exchange.

4. As at August 31, 2011, residents of Canada did not own, directly or indirectly, more than 10 percent of the outstanding Common Shares and did not represent in number more than 10 percent of the total number of owners, directly or indirectly, of Common Shares.

5. Hewlett Packard (Canada) Co. (HP Canada), a wholly-owned subsidiary of the Filer is a corporation incorporated under the federal laws of Canada. HP Canada is not a reporting issuer in any jurisdiction in Canada and does not have any present intention of becoming a reporting issuer or its equivalent in any jurisdiction in Canada.

6. The principal office of HP Canada is situated in Ontario.

7. The Filer operates the HP 2011 Plan. Common Shares may be purchased under the HP 2011 Plan by various employees of HP and its affiliated entities eligible to participate (Eligible Employees). The HP 2011 Plan is implemented by offering periods generally lasting for six months (each, an Offering Period). Each Eligible Employee who participates in the HP 2011 Plan is automatically granted an option to purchase Common Shares (an Option). Options are exercised and Common Shares are purchased under the HP 2011 Plan at the end of each Offering Period, unless the participant withdraws or terminates employment earlier.

8. In Canada, the Filer also operates the HP 2004 Stock Incentive Plan for the benefit of the employees of the Filer and its subsidiaries, including HP Canada. The Filer previously operated the HP 2000 Employee Stock Purchase Plan and the HP 2000 Stock Plan, among other equity compensation plans, for the benefit of the Filer and its subsidiaries, including HP Canada.

9. The Filer uses the services of a plan administrator in connection with the HP 2011 Plan. The current plan administrator under the HP 2011 Plan is Mellon Investor Services LLC, doing business as Mellon Shareowner Services (the Administrator). Trades in Common Shares acquired under the HP 2011 Plan will be effected through BNY Mellon Capital Markets, LLC, an affiliate of the Administrator that is registered under applicable U.S. securities legislation to trade in securities in the category of broker-dealer (together with the Administrator, BNYM).

10. Eligible Employees in Canada who are granted Common Shares or Options under the HP 2011 Plan will be provided with all the disclosure documentation that HP employees resident in the United States who receive Common Shares or Options under the HP 2011 Plan are entitled to receive.

11. Participation in the HP 2011 Plan is and will be voluntary and the Eligible Employees will not be induced to participate in the HP 2011 Plan or exercise Options by expectation of employment or continued employment with HP, HP Canada or any other affiliated entity of HP.

12. Generally, each Eligible Employee may elect to make contributions under the HP 2011 Plan by payroll deduction of any amount up to, but not exceeding, 10% of his or her base earnings.

13. Because there is no market for the Common Shares in Canada and none is expected to develop, any trades of the Common Shares by Eligible Employees, their legal representatives or permitted transferees or BNYM will be effected through the facilities of and in accordance with the rules of an exchange or market outside of Canada on which the Common Shares are traded.

14. An exemption from the dealer registration requirement of the Legislation is not available in the Jurisdictions for resale of the Common Shares acquired pursuant to the HP 2011 Plan, including trades effected through BNYM. Such an exemption would be available in respect of trades made by a plan administrator pursuant to section 8.16(3) of National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Obligations but for the fact that HP is a reporting issuer in Quebec.

Decision

The principal regulator is satisfied that the decision meets the test set out in the Legislation for the principal regulator to make the decision.

The decision of the principal regulator under the Legislation is that the Exemption Sought is granted provided that the first trade in the Common Shares issued upon the exercise of Options under the HP 2011 Plan is deemed to be a distribution unless the following conditions are satisfied:

(a) at the time of the issuance of the Common Shares upon the exercise of the Options (the Exercise Time), the Filer is not a reporting issuer in any jurisdiction of Canada except Québec;

(b) at the Exercise Time, after giving effect to the issuance of the Common Shares and any other Common Shares that were issued at the same time as or as part of the same distribution, residents of Canada:

(i) did not own directly or indirectly more than 10 percent of the outstanding Common Shares, and

(ii) did not represent in number more than 10 percent of the total number of owners directly or indirectly of Common Shares; and

(c) the trade is made:

(i) through an exchange, or a market, outside of Canada, or

(ii) to a person or company outside of Canada.

"Edward P Kerwin"
Commissioner
Ontario Securities Commission
 
"Judith Robertson"
Commissioner
Ontario Securities Commission