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 a transcript of selected questions and answers provided during
a conference call on November 14, 2001 with financial analysts and other
members of the public relating to HP's fiscal 2001 fourth quarter and 2002
guidance. Carleton S. Fiorina, HP's Chairman of the Board and Chief
Executive Officer, provided the following answers in response to questions
relating to the Merger.
SELECTED QUESTIONS AND ANSWERS
SG Cowen, Richard Chu: Okay, and then a question for Carly. Obviously, you
continue to articulate your belief in the Compaq merger strongly here, but
given a real possibility that the transaction doesn't go through, however
you think strongly about it. I wonder if you can comment on the where-with-all
for Hewlett-Packard to execute and succeed in the enterprise competing in
services markets on its own. What do you think about your ability to do the
job without the merger?
Carleton S. Fiorina: I think it's important to remember that the approval of
this merger is a process, that we are not yet even halfway through. We have
not yet filed an S-4 statement as an example. And clearly, the S-4 statement
is an important document to begin a process for shareowner votes. We also have
regulatory approvals to obtain. Many institutions, most institutions, are
looking at both the S-4 statement and regulatory progress over the next
several weeks and months to make their decision.
So, candidly, despite the actions by some individuals, I think it's way too
early to conclude that this merger will not occur. We remain convinced it is
in the best interest of shareowners. We remain convinced that this merger
will occur. And so, I won't speculate theoretically on what happens if it
doesn't.
Chu: Okay, thank you.
###
Sanford Bernstein, Toni Sacconaghi: Okay, that's very helpful. And then a
question for Carly, if I may. Given that you were surprised as I think most
of us were by the Hewlett Foundation coming out in a fairly public way, about
its feelings, about the merger, how have you been working or interacting with
the Packard Foundation, before the Hewlett announcement, currently, and now
you expect it going forward.
Fiorina: Well, I think the Packard Foundation has commented for itself and I
think they really need to comment for themselves, but they are engaged in a
quite deliberate process. That process has been going on for some time and
certainly includes a thorough examination of the S-4 statement when it is
released.
We have been interacting with the Packard Foundation in the same way that we
are interacting with other institutional investors. We have met with them as
we have met with other investors, and we will continue to meet with them just
as we do with other investors, as the Foundation continues its deliberations.
Sacconaghi: And you have no expectation on when and if the Packard Foundation
will make a determination?
Fiorina: I think it's fair to say and the Packard Foundation ought to speak
for itself. But I think it's fair to say that the Packard Foundation will
probably not make a decision until December or January. That is what they
have publicly stated.
Sacconaghi: Okay, thank you. Congratulations on a solid quarter.
###
UBS Warburg, Anthony Torna: ...could you give us some color, about customer
or your reaction to the Hewlett announcement news in the last two weeks?
Fiorina: ...I think certainly, it's fair to say that the barrage of media
attention surrounding their actions has been a bit distracting for people. I
think it's also fair to say that as demonstrated by this quarter, employees
continue to keep their heads down and focused on customers and business
fundamentals. And I would expect that to continue.
I think in terms of customers, frankly, customers are more concerned with the
things that impact them everyday and those are pretty fundamental. Is their
account rep doing the right thing for them? Do they understand how these
product plans are going to come together? Are we able to the extent we can
given the regulatory constraints, to explain in a convincing way why this is
helpful to them?
###
Deutsche Bank, George Elling: I was going to say that one of the clear
positives to the Hewlett/Compaq merger would be the huge computer
install-base that will be
established between the two combined companies. What has their response been
to the deal? Needless to say, your competitors believed your combined base is
ripe for their picking, but I'd like to hear, Carly, on some of your views.
Fiorina: George, you're asking for our customers' reaction?
Elling: Yes.
Fiorina: Well, first, you are absolutely right. One of the clear benefits of
the merger is a large install-base, as well as the sales force that goes with
it. Secondly, the customers' reaction, there has been many surveys done by
lots of different folks. I think our constant interaction with customers
would indicate that they are concerned about the things that matter to them
most. It's an obvious point. But they're concerned about who will be my
account team, and how do I know that that interaction will improve with this
merger.
So, customers are very interested in the fact that our sales force will
double in size. The fact that we are explicitly not reducing the number of
feet on the street, and therefore, can have better account coverage. They're
focused on the fact that we've made a commitment to give them their account
team by name, no later than 30 days after this merger closes. And as well
they're looking for details on our product line roadmaps going forward. We
are, as you know, somewhat constrained by the regulatory process, but again,
we have committed to customers that they will have full details on product
line roadmaps for all of the products that each of these companies sell
individually today, within 30 days after the merger closes.
We can make that commitment with confidence because in our planning
activities that are going on now, we have a very clear idea of how that may
lay out. And so, those are the things they are focused on. And finally, what
they're focused on is will we protect the investments that they make between
now and the time the merger closes in either Compaq or HP products? The
answer is yes.
And finally, they're focused on are their account teams doing a good job for
them. Are they staying focused on serving them, on understanding their
requirements and being responsive? And I think that's what customers care
about and I think we're executing against those set of requirements well.
Elling: Thank you.
FORWARD-LOOKING STATEMENTS
This transcript contains forward-looking statements that involve risks and
uncertainties, as well as assumptions that, if they never materialize or
prove incorrect, could cause the results of HP and its consolidated
subsidiaries to 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 planned acquisitions; any statements
concerning proposed new products, services, developments or industry
rankings; any statements regarding future economic conditions or performance;
statements of belief and any statement 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 acquisitions and
achieving anticipated synergies; the possibility that proposed acquisitions
may not close or that modifications of some aspects of proposed acquisitions
may be required in order to obtain regulatory approvals; the assumption of
maintaining revenues on a combined company basis following acquisitions; and
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. 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 November 15, 2001, HP filed a Registration Statement with the SEC
containing a preliminary joint proxy statement/prospectus regarding the
Merger. Investors and security holders of HP and Compaq are urged to read the
preliminary joint proxy statement/prospectus filed with the SEC on
November 15, 2001 and the definitive joint proxy statement/prospectus when it
becomes available 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 will be
sent to the security holders of HP and Compaq seeking their approval of the
proposed transaction. The preliminary joint proxy statement/prospectus filed
with the SEC on November 15, 2001, 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.
HP, Carleton S. Fiorina, HP's Chairman of the Board and Chief Executive
Officer, Robert P. Wayman, HP's Executive Vice President, Finance and
Administration 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.
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 preliminary
joint proxy statement/prospectus filed with the SEC on November 15, 2001 and
the definitive 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. 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 preliminary joint proxy statement/prospectus filed with
the SEC on November 15, 2001 and the definitive joint proxy
statement/prospectus when it becomes available.
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