Hewlett-Packard CEO Mark Hurd Resigns After Sexual Harassment Probe

PALO ALTO, Calif.--(BUSINESS WIRE)--HP today announced that Chairman, Chief Executive Officer and President Mark Hurd has decided with the Board of Directors to resign his positions effective immediately.

The Board has appointed CFO Cathie Lesjak, 51, as CEO on an interim basis. Lesjak is a 24-year veteran of the company who has served as HP’s CFO and as a member of the company’s Executive Council since January 2007. She oversees all company financial matters and will retain her CFO responsibilities during the interim period.

Severance Package

In an SEC filing this afternoon, Hewlett-Packard has disclosed details of just-resigned CEO Mark Hurd’s severance package.

• The company will pay Hurd $12.2 million within 30 days.
• HP will also reimburse Hurd for medical and dental premiums per his COBRA eligibility for the next 18 months.
• The company extends to Sept. 7 the expiration of outstanding options for Hurd to acquire up to 775,000 shares of HP common stock.
• Over 300,000 performance-based restricted stock units have now become eligible to vest and be settled in shares of HP common stock.

For more details, here is the full separation agreement.

Hurd’s decision was made following an investigation by outside legal counsel and the General Counsel’s Office, overseen by the Board, of the facts and circumstances surrounding a claim of sexual harassment against Hurd and HP by a former contractor to HP. The investigation determined there was no violation of HP’s sexual harassment policy, but did find violations of HP’s Standards of Business Conduct.

Hurd said: “As the investigation progressed, I realized there were instances in which I did not live up to the standards and principles of trust, respect and integrity that I have espoused at HP and which have guided me throughout my career. After a number of discussions with members of the board, I will move aside and the board will search for new leadership. This is a painful decision for me to make after five years at HP, but I believe it would be difficult for me to continue as an effective leader at HP and I believe this is the only decision the board and I could make at this time. I want to stress that this in no way reflects on the operating performance or financial integrity of HP.”