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Technology Stocks : Compaq -- Ignore unavailable to you. Want to Upgrade?

To: Night Writer who wrote (94588)	1/7/2002 5:00:49 PM
From: Elwood P. Dowd	Respond to of 97611

HP's Board Castigates Wobbly Walter by: skeptically 01/07/02 04:38 pm Msg: 267377 of 267382 H-P Bd "Disappointed" With Walter Hewlett's Proxy Filing 01/07 3:36 PM (DJ) Story 6022 DJ Hewlett-Packard -2: Says Hewlett Not Pressured To OK Deal WASHINGTON (Dow Jones)--Hewlett-Packard Co.'s (HWP) board said it was disappointed in Walter Hewlett's recent proxy statement with the Securities and Exchange Commission and disputed his version of some of the events leading up to the board's vote. "We know you to be an independent thinker and an experienced board member who knows very well what your fiduciary duties are - to vote as a director in the best interests of HP shareowners," the board said in a filing Monday with the SEC. "We all assumed that you were upholding those duties when you willingly voted in favor of the merger as a director. To suggest that you were pressured into approving the merger is inaccurate and inappropriate." In Hewlett's proxy statement on Dec. 27, 2001, he said he made it clear to the board that a unanimous vote requirement by the directors put him in a very difficult position, as he wasn't persuaded that the deal was in the best interests of the company or its shareholders. However, Hewlett said he decided to vote for the deal as a director to give HP shareholders the opportunity to make their own decision. Hewlett also said he was informed the company was going to proceed with the proposed merger whether or not he voted in favor of it. But without his affirmative vote, the agreement in its current form couldn't be signed without renegotiation, and HP might then have to pay a higher price for Compaq Computer Corp. (CPQ), he said in his proxy statement. HP contends in Monday's filing that Hewlett was never advised that the company would be forced to pay a higher price for Compaq if he voted against the merger. The board said there was no discussion regarding a non-unanimous board vote requiring the payment of a higher price for Compaq. At the time of the alleged discussions regarding these matters, the filing said, price, among other significant issues, remained unresolved. In his proxy statement, Hewlett said he first learned in May that HP Chief Executive Carly Fiorina was talking with Compaq about a proposed merger. After considering the merits of the deal and expressing his concerns at board meetings over the next three months, Hewlett said he continued to believe the merger would permanently destroy HP stockholder value. But the board said Hewlett failed to attend "key" board meetings at which financial and strategic aspects of the merger were discussed in detail. The board said it was "inappropriate" that Hewlett didn't disclose his absence from these meetings in his proxy statement. The board also said Hewlett didn't inform it of his decision to vote against the deal as a shareholder until the last minute. "Contrary to your public assertions otherwise, neither the board nor management were informed how you would vote your shares until one-half hour before your public announcement on Nov. 6." Hewlett has said that rather than undertaking a "large and risky acquisition," HP management should focus on resolving challenges to its businesses. "We do not at all believe that HP should stand still...and would prefer HP to focus on what it does well, and to change and grow organically, with targeted tactical acquisitions," he said. The board said in the filing that Hewlett has never offered an alternative to the deal. "Quite frankly Walter, you have never offered an alternative strategy that we all haven't debated and rejected." -Ben Siegel; Dow Jones Newswires; 202 -628 -7689 (END) DOW JONES NEWS 01 -07 -02 04:27 PM