Filed by Hewlett-Packard Company Pursuant to Rule 425
Under the Securities Act of 1933
And Deemed Filed Pursuant to Rule 14a-6
Under the Securities Exchange Act of 1934
Subject Company: Compaq Computer Corporation
Commission File No.: 333-73454
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 relating to the Merger. This article is posted on
HP's internal web site.
NO MYSTERY BEHIND EMPLOYEE PULSE DATA
NUMBER OF EMPLOYEES WHO FAVOR HP-COMPAQ MERGER REQUIRES APPROPRIATE CONTEXT
The question of how many HP employees favor the merger with Compaq seems to have
taken on a life of its own in recent weeks. Our senior leaders have referred to
certain percentages at coffee talks or other internal events, and numerous media
outlets have sprinkled various estimates in their articles on the pending merger
to illustrate general sentiment across the company.
[HP's internal web site] has received a significant number of questions and
comments from employees regarding where these "mysterious" percentages have come
from and thought it would be useful to explain.
In the meantime, Forbes.com, the online version of the magazine, published a
story ("Where Do HP Employees Stand on Merger?") that mischaracterized the
results of an informal question posted on HP's Discussion Forum back in
November.
REASONS FOR ORGANIZATIONAL PULSES
Since HP announced the plan to merge with Compaq last September, the company's
Internal Communications department has conducted regular, informal surveys
called "organizational pulses." In addition, employee audience members have been
polled after coffee talks and town hall meetings to help the department gather
data on how employees feel about the merger.
"From the beginning, we conducted these surveys to help evaluate the
effectiveness of our communications vehicles and content," says Yvonne Hunt,
director, Internal Communications. "We also use them to identify areas for
improvement, measure shifts in attitudes regarding the merger, learn more about
specific employee concerns, and feed these concerns to management."
EMPLOYEES SURVEYED WORLDWIDE
The pulse surveys are conducted on the Web by an independent consultant with the
help of the company's Communication Council, which comprises representatives of
all HP businesses and functions around the world. The council members distribute
a URL for a Web-based questionnaire to a representative sample of up to 1
percent of their respective organizations. About 850 different employees receive
the questionnaire each month, and the identity of each respondent is kept
completely confidential.
A typical pulse survey draws approximately 400 to 500 responses. The question in
each pulse that has appeared in media stories is the following:
o "How would you describe your current level of support for the merger?"
HP also collects data following key communication events, such as Senior Leader
meetings, coffee talks conducted by CEO Carly Fiorina, merger discussion
sessions and satellite broadcasts. Employees who attend these events receive a
hardcopy questionnaire, and, when relevant, those who viewed the event by
satellite or digitized video are asked to offer additional feedback via the Web.
Approximately 60-70 percent of the physical attendees at recent events have
completed questionnaires.
DECEMBER-JANUARY PULSE DATA
In the December 2001 - January 2002 pulse data, 21 percent of the respondents
considered themselves "very supportive" of the merger and 44 percent said they
were "somewhat supportive." The combined figure of "65 percent supportive" has
been cited at several internal events and has appeared regularly in recent media
stories.
"The 65-percent figure sometimes has been mentioned without the context during
our internal events, which tend to be more informal," said Hunt. "We do think
the pulse numbers are accurate when placed into the proper context. What's more
interesting is that the percentage of favorable responses has remained
consistently positive over the past few months."
FORBES.COM AND THE DISCUSSION FORUM
In its February 15 online article, Forbes stated that "HP's unscientific poll
shows that 60 percent of 2,421 respondents responded `not at all' or `not
really' to the question `How confident are you in the future of HP after hearing
Carly's Q4 message?'"
What the article fails to explain is that the informal HP Discussion Forum
exists to stimulate online conversation and provide anecdotal feedback from
employees. Any polling results are both unscientific and unrepresentative since
the respondents are a self-selecting group. In addition, many of the responses
occurred right after Walter Hewlett filed his opposition and before HP had begun
communicating the specific benefits of the merger.
Nearly all of the 2,421 responses to the forum were made in November 2001. The
more reliable organizational pulse survey conducted at roughly the same time
showed that 55 percent of HP employees were either "very supportive" of the
merger (16 percent) or "somewhat supportive" (39 percent). As previously noted,
both of these categories have since improved.
FORWARD-LOOKING STATEMENTS
This document contains forward-looking statements that involve risks,
uncertainties and assumptions. If any of these risks or uncertainties
materializes or any of these assumptions proves incorrect, the results of HP and
its consolidated subsidiaries could differ materially from those expressed or
implied by such forward-looking statements.
All statements other than statements of historical fact are statements that
could be deemed forward-looking statements, including any projections of
earnings, revenues, synergies, accretion or other financial items; any
statements of the plans, strategies, and objectives of management for future
operations, including the execution of integration and restructuring plans and
the anticipated timing of filings, approvals and closings relating to the Merger
or other planned acquisitions; any statements concerning proposed new products,
services, developments or industry rankings; any statements regarding future
economic conditions or performance; any statements of belief and any statements
of assumptions underlying any of the foregoing.
The risks, uncertainties and assumptions referred to above include the ability
of HP to retain and motivate key employees; the timely development, production
and acceptance of products and services and their feature sets; the challenge of
managing asset levels, including inventory; the flow of products into
third-party distribution channels; the difficulty of keeping expense growth at
modest levels while increasing revenues; the challenges of integration and
restructuring associated with the Merger or other planned acquisitions and the
challenges of achieving anticipated synergies; the possibility that the Merger
or other planned acquisitions may not close or that HP, Compaq or other parties
to planned acquisitions may be required to modify some aspects of the
acquisition transactions in order to obtain regulatory approvals; the assumption
of maintaining revenues on a combined company basis following the close of the
Merger or other planned acquisitions; and other risks that are described from
time to time in HP's Securities and Exchange Commission reports, including but
not limited to HP's annual report on Form 10-K, as amended on January 30, 2002,
for the fiscal year ended October 31, 2001 and HP's registration statement on
Form S-4 filed on February 5, 2002.
HP assumes no obligation and does not intend to update these forward-looking
statements.
ADDITIONAL INFORMATION ABOUT THE MERGER AND WHERE TO FIND IT
On February 5, 2002, HP filed a registration statement with the SEC containing a
definitive joint proxy statement/prospectus regarding the Merger. Investors and
security holders of HP and Compaq are urged to read the definitive joint proxy
statement/prospectus filed with the SEC on February 5, 2002 and any other
relevant materials filed by HP or Compaq with the SEC because they contain, or
will contain, important information about HP, Compaq and the Merger. The
definitive 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
definitive 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.