[LOGO OF XXXXXXXX.XXX]
January 21, 1999
To Our Shareholders:
On behalf of the Board of Directors of Xxxxxxxx.xxx (the "Company"), I am
writing to inform you that the Company and Compaq Computer Corporation
("Compaq") have amended the Merger Agreement referred to in my letter to you
dated January 15, 1999. Pursuant to the amended Merger Agreement, the Offer
Price for your shares of Company Common Stock (the "Shares") to be paid by
Compaq Interests, Inc., an indirect, wholly-owned subsidiary of Compaq
("Purchaser"), in connection with the tender offer commenced on January 15,
1999 (the "Offer") has been reduced to $18.25 per share (the "Amended Offer
Price").
The reduction in the Offer Price was negotiated between Compaq and the
Company following the disclosure by the Company of additional information
after commencement of the Offer, including information regarding the number of
shares of common stock and convertible securities outstanding.
The Amended Offer Price of $18.25 nevertheless represents an approximately
38.4% premium over the closing market price of the Common Stock on the last
full trading day prior to public announcement that the Company and Compaq
executed the Merger Agreement. Notwithstanding the Amended Offer Price, the
aggregate enterprise value of the Company remains approximately the same.
Your Board of Directors has unanimously determined that each of the Offer
and Merger is fair to and in the best interests of the shareholders of the
Company and recommends that the shareholders of the Company accept the Offer
and tender all of their Shares pursuant to the Offer.
In arriving at its recommendation, the Board of Directors gave careful
consideration to a number of factors described in the attached Amendment No. 1
to Solicitation/Recommendation Statement on Schedule 14D-9 (the "Schedule 14D-
9") that is being filed with the Securities and Exchange Commission. Among
other things, the Board of Directors considered the revised opinion of its
financial advisor, Xxxxxxxx Xxxxxx & Company, that the consideration to be
received by the holders of Shares pursuant to the Offer and the Merger is
fair, from a financial point of view, to such holders.
In addition to the attached Schedule 14D-9, enclosed also is a Supplemental
Letter to Shareholders, dated January 21, 1999 from Compaq. These documents
state the terms and conditions of the Offer and the Merger, as amended, and
provide instructions as to how to tender your Shares. I urge you to read these
documents carefully in making your decision with respect to tendering your
Shares pursuant to the Offer.
Sincerely,
/s/ Xxxxx X. Xxxxx
Xxxxx X. Xxxxx
President and Chief Executive
Officer
0000 Xxxx Xxxxx Xxxxxxx
Xxxxxx Xxxxx
Xxxxxx Xxx Xxx, Xxxxxxxxxx 00000
(000) 000-0000
