Hewlett Packard Enterprise Co.
11/05/2024 | Press release | Distributed by Public on 11/05/2024 15:03
Management Change/Compensation Form 8 K
| Item 5.02 | Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangement of Certain Officers. |
On December 1, 2021, the HR and Compensation Committee ("HRC Committee") of the Board of Directors of Hewlett Packard Enterprise Company ("HPE" or the "Company") approved the performance metrics and target achievement levels for HPE's fiscal 2022 Performance-Adjusted Restricted Stock Unit ("PARSU") awards under the Hewlett Packard Enterprise Company 2021 Stock Incentive Plan (the "Plan"). The fiscal 2022 PARSUs provide the opportunity for certain of our current and former named executive officers, to earn stock-based incentive awards tied to non-GAAP net income growth and relative total shareholder return achievement over the performance period from November 1, 2021 to October 31, 2024. The Plan grants the HRC Committee the authority to make certain adjustments to PARSU performance metrics when certifying the results for purposes of determining PARSU vesting, including in cases where unforeseen or extraordinary events result in impacts on HPE's financial results.
During the performance period, the conflict between Russia and Ukraine and the related sanctions imposed by the U.S., European Union, and other countries in response negatively impacted our operations in both countries. In response to these developments, as previously reported, in February 2022, we suspended all new sales and shipments to Russia and Belarus. Based on a further assessment of business risks and needs, in June 2022, we determined that it was no longer tenable to maintain operations in Russia and Belarus and have since been proceeding with an orderly, managed exit of our remaining business in these countries.
In light of HPE's decision to exit from our businesses in Russia and Belarus and the related negative impact such action has had on HPE's non-GAAP net income growth measurement for the fiscal 2022 PARSU awards, on October 30, 2024, the HRC Committee modified the non-GAAP net income growth target achievement level for segment two of the fiscal 2022 PARSUs to remove income related to the Russia and Belarus businesses from the reported financial results for fiscal 2021 and fiscal 2022 to enable a consistent year-over-year growth comparison during the performance cycle. The HRC Committee believed that this modification was necessary to support the objectives of the program design.
As a result of this modification, the total payout for segment two of the fiscal 2022 PARSUs is estimated to increase by approximately 37%, compared to what the total payout would have been had this modification not been made.