Filed by Hewlett-Packard Company Pursuant to Rule 425
Under the Securities Act of 1933
And Deemed Filed Pursuant to Rule 14a-12
Under the Securities Exchange Act of 1934
Subject Company: Compaq Computer Corporation
Commission File No.: 1-9026
This filing relates to a planned merger (the "Merger") between Hewlett-Packard
Company ("HP") and Compaq Computer Corporation ("Compaq") pursuant to the terms
of an Agreement and Plan of Reorganization, dated as of September 4, 2001 (the
"Merger Agreement"), by and among HP, Heloise Merger Corporation and Compaq. The
Merger Agreement is on file with the Securities and Exchange Commission as an
exhibit to the Current Report on Form 8-K, as amended, filed by Hewlett-Packard
Company on September 4, 2001, and is incorporated by reference into this filing.
The following is an article by HP discussing media responses to a series of
frequently asked questions and answers directed to HP employees. This article
and the FAQ directed to HP employees are posted on HP's internal web site. The
FAQ directed to HP employees may also be found in HP's Form 425 filed with the
Securities and Exchange Commission on October 1, 2001.
MEDIA REPORTS ON JOB REDUCTIONS CLARIFIED
MEDIA REPORTS CLARIFIED
Posted October 2, 2001
Several recent media stories referring to merger-related job reductions have
caused consternation among Hewlett-Packard employees. A Bloomberg report stated
that the total number of job cuts resulting from the merger may reach 30,000.
This number is highly speculative. HP has not released any new information
around estimated job reductions since the merger was announced September 3. At
that time, the company said it expected cuts in the neighborhood of 15,000, "on
the conservative side."
Other articles stated that, earlier this week, HP warned employees about further
reductions prior to the merger.
There has been no new "announcement" or updates on the estimated number of job
reductions. Here lies the source of the media's misunderstanding: On September
26, [HP's internal web site] published a set of HP-Compaq merger FAQs. Due to
Securities and Exchange Commission (SEC) requirements, HP must file all
merger-related communications -- internal and external -- for public viewing.
Several members of the media read the FAQs and misinterpreted a response
addressing job reductions.
THE TEXT IN QUESTION
The answer to [the question, "Can you provide more information on the 15,000
workforce reductions mentioned by the media?", included in the FAQ directed to
HP employees and posted on HP's internal web site] reaffirms HP and Compaq's
earlier statement that headcount reductions of "approximately 15,000, or about
10 percent of the combined workforce, will occur during the first two years
after the merger closes" through a "combination of targeted job reductions and
attrition."
The response goes on to state that between now and the merger closing, HP "will
continue to make decisions that may involve further reductions in staffing
levels." Such decisions may include consolidations, decisions to exit
particular businesses and divestitures/outsourcing, all of which are considered
"business as usual" for the company.
This communication is consistent with what HP has told employees and the
marketplace since July. Irrespective of the merger, HP must continue to make
strategic choices and work toward creating a competitive long-term cost
structure.
In the coming months before the merger is finalized, the public will be privy to
HP and Compaq's merger-related communications. These include intranet articles,
memos from the Integration Office, executive messages and FAQs. While HP's Media
Relations department is continually working to prevent incorrect reports,
misinterpretations do -- and will -- occur occasionally. Employees should refer
regularly to [HP's internal web site] for merger-related stories and messages.
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FORWARD LOOKING STATEMENTS
This document contains forward-looking statements that involve risks,
uncertainties and assumptions. All statements other than statements of
historical fact are statements that could be deemed forward-looking statements.
For example, statements of expected synergies, accretion, timing of closing,
industry ranking, execution of integration plans and management and
organizational structure are all forward-looking statements. Risks,
uncertainties and assumptions include the possibility that the market for the
sale of certain products and services may not develop as expected; that
development of these products and services may not proceed as planned; that the
Compaq transaction does not close or that the companies may be required to
modify aspects of the transaction to achieve regulatory approval; or that prior
to the closing of the proposed merger, the businesses of the companies suffer
due to uncertainty; that the parties are unable to transition customers,
successfully execute their integration strategies, or achieve planned synergies;
other risks that are described from time to time in HP's Securities and Exchange
Commission reports (including but not limited to the annual report on Form 10-K
for the year ended Oct. 31, 2000, and subsequently filed reports). If any of
these risks or uncertainties materializes or any of these assumptions proves
incorrect, HP's results could differ materially from HP's expectations in these
statements. HP assumes no obligation and does not intend to update these
forward-looking statements.
Additional Information about the Merger and Where to Find It
HP and Compaq intend to file with the SEC a joint proxy statement/
prospectus and other relevant materials in connection with the Merger. The joint
proxy statement/prospectus will be mailed to the stockholders of HP and Compaq.
Investors and security holders of HP and Compaq are urged to read the joint
proxy statement/prospectus and the other relevant materials when they become
available because they will contain important information about HP, Compaq and
the Merger. The joint proxy statement/prospectus and other relevant materials
(when they become available), and any other documents filed by HP or Compaq with
the SEC, may be obtained free of charge at the SEC's web site at www.sec.gov. In
addition, investors and security holders may obtain free copies of the documents
filed with the SEC by HP by contacting HP Investor Relations, 3000 Hanover
Street, Palo Alto, California 94304, 650-857-1501. Investors and security
holders may obtain free copies of the documents filed with the SEC by Compaq by
contacting Compaq Investor Relations, P.O. Box 692000, Houston, Texas
77269-2000, 800-433-2391. Investors and security holders are urged to read the
joint proxy statement/prospectus and the other relevant materials when they
become available before making any voting or investment decision with respect to
the Merger.
HP, Carleton S. Fiorina, HP's Chairman of the Board and Chief Executive
Officer, Robert P. Wayman, HP's Executive Vice President and Chief Financial
Officer, and certain of HP's other executive officers and directors may be
deemed to be participants in the solicitation of proxies from the stockholders
of HP and Compaq in favor of the Merger. The other executive officers and
directors of HP who may be participants in the solicitation of proxies in
connection with the Merger have not been determined as of the date of this
filing. A description of the interests of Ms. Fiorina, Mr. Wayman and HP's other
executive officers and directors in HP is set forth in the proxy statement for
HP's 2001 Annual Meeting of Stockholders, which was filed
with the SEC on January 25, 2001. Full participant information may be found in
HP's Form 425 filed with the SEC on September 25, 2001. Investors and security
holders may obtain more detailed information regarding the direct and indirect
interests of Ms. Fiorina, Mr. Wayman and HP's other executive officers and
directors in the Merger by reading the joint proxy statement/prospectus when it
becomes available.
Compaq and Michael D. Capellas, Compaq's Chairman and Chief Executive
Officer, and certain of Compaq's other executive officers and directors may be
deemed to be participants in the solicitation of proxies from the stockholders
of Compaq and HP in favor of the Merger. The other executive officers and
directors of Compaq who may be participants in the solicitation of proxies in
connection with the Merger have not been determined as of the date of this
filing. A description of the interests of Mr. Capellas and Compaq's other
executive officers and directors in Compaq is set forth in the proxy statement
for Compaq's 2001 Annual Meeting of Stockholders, which was filed with the SEC
on March 12, 2001. Full participant information may be found in Compaq's Form
425 filed with the SEC on September 17, 2001. Investors and security holders may
obtain more detailed information regarding the direct and indirect interests of
Mr. Capellas and Compaq's other executive officers and directors in the Merger
by reading the joint proxy statement/prospectus when it becomes available.
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