HEWLETT-PACKARD COMPANY

2001 EXECUTIVE TRANSITION PROGRAM

ARTICLE I
PURPOSE, ESTABLISHMENT AND APPLICABILITY OF PLAN

A. Purposes. On September 4, 2001, Hewlett-Packard Company (the "Company") announced its plans for a strategic merger with Compaq Computer Corporation (the "Merger"). The Company's Board of Directors (the "Board") recognizes that the Merger is a distraction to key Employees and may cause such Employees to consider alternative employment opportunities. The Board has determined that it is in the best interests of the Company and its stockholders to assure that the Company will have the continued dedication of these Employees, notwithstanding the uncertainty created by the Merger, and that it is in the best interests of the Company and its stockholders to provide these Employees with financial security and encouragement to remain with the Company and to maximize the value of the Company following completion of the Merger.

B. Establishment of Plan. The Plan, as set forth in this document, is hereby effective as of the Effective Date.

C. Applicability of Plan. Subject to the terms of this Plan, the benefits provided by this Plan shall be available to those Employees who, on or after the Effective Date, receive a Notice of Participation and who meet the eligibility requirements of Article III.

ARTICLE II
DEFINITIONS AND CONSTRUCTION

Whenever used in the Plan, the following terms shall have the meanings set forth below.

A. Board. "Board" means the Board of Directors of the Company.

B. Cause. "Cause" means (i) the Participant's willful failure to substantially perform his or her material duties (other than as a failure resulting from the Participant's complete or partial incapacity due to physical or mental illness or impairment) for a period of thirty (30) days after a written demand for substantial performance is delivered to the Participant by the Plan Administrator that specifically identifies the manner in which the Plan Administrator believes that the Participant has not substantially performed his or her duties, (ii) a material and willful violation of a federal or state law or regulation applicable to the business of the Company, and (iii) a willful act by the Participant that constitutes gross misconduct and that is injurious to the Company. No act, or failure to act, by the Participant shall be considered "willful" unless committed without good faith and without a reasonable belief that the act or omission was in the Company's best interests.

C. Code. "Code" means the Internal Revenue Code of 1986, as amended.

D. Company. "Company" means Hewlett-Packard Company, any subsidiary corporations, any successor entities as provided in Article XI hereof, and any parent or subsidiaries of such successor entities.

E. Constructive Termination. The Participant's employment may be terminated by reason of Constructive Termination. For purposes of this Plan, "Constructive Termination" means the Participant terminates his or her employment with the Company as a result of one or more of the following events (unless such event (s) applies generally to all officers of the Company): (i) without the Participant's express written consent, a reduction by the Company in the Participant's annualized Target Pay relative to his or her annualized Target Pay as in effect immediately prior to such reduction; (ii) a reduction in the Participant's annualized base salary relative to his or her annualized base salary as in effect immediately prior to such reduction (other than a reduction under the Pay-for-Results Plan in accordance with its terms as consistently applied); and (iii) without the Participant's express written consent, a material reduction by the Company in the kind or level of employee benefits to which the Participant is entitled immediately prior to such reduction with the result that the Participant's overall benefits package is significantly reduced.

F. Disability. "Disability" means a disability under the Company's Income Protection Plan that entitles the Participant to benefits under such Plan for a period of at least twenty-six (26) weeks.

G. Effective Date. "Effective Date" means September 4, 2001. Notwithstanding the foregoing nor any contrary provision in this Plan, severance and other benefits under the Plan will be paid only if the transaction described in the Agreement and Plan of Reorganization by and among Hewlett-Packard Company, Heloise Merger Corporation and Compaq Computer Corporation (the "Merger Agreement") is completed.

H. Employee. "Employee" means an employee of the Company.

I. ERISA. "ERISA" means the Employee Retirement Income Security Act of 1974, as amended.

J. Non-Qualified Retirement Plans. "Non-Qualified Retirement Plans" means the following Company plans as in effect as of the Effective Date:

(i) the Excess Benefit Retirement Plan;

(ii) the Officers Early Retirement Plan;

(iii) the International Retirement Guarantee; and

(iv) the Global Retirement Supplement.

K. Notice of Participation. "Notice of Participation" means an individualized written notice of participation in the Plan from an authorized officer of the Company.

L. Participant. "Participant" means an individual who meets the eligibility requirements of Article III.

M. Plan. "Plan" means this Hewlett-Packard Company Executive Transition Program.

N. Plan Administrator. "Plan Administrator" means the Board or its committee or designate, as shall be administering the Plan.

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