1. “We are the largest manufacturer of computers in the world … Now we have added leadership high-performance 64-bit technology with Alpha and Digital UNIX.” Customer letter dated June 12, 1998, signed Eckard Pfeiffer, President and Chief Executive Officer, COMPAQ

2. February 19982 Some facts and figures... Fortune 500 ranking: number 17 with 1997 pro-forma earnings of $37.6B 1997 net income $1.87B 1997 R&D investment $1.86B 80M PCs sold in 1997, 12.7% market share 80% of Windows NT server market

3. February 19983 Mission and Goals Deliver customers simple and useful computing solutions in the inter-networked world. Accelerate industry-standard computing Accelerate time to solution Be a trusted advisor and strategic partner in IT

4. February 19984 Accelerate time to solution Complex, multi-layered solutionStandards-based solutions Disparate information sourcesPackaged enterprise solution Inadequate integration and validationIndustry-standard tools and Shortage of skilled personnelmethods 1980s1990s2000s The changing solution landscape

5. February 19985 COMPAQ and Alpha COMPAQ is committed to making Alpha a standard for 64-bit UNIX Alpha is the development platform for 64-bit Windows NT Alpha is the only platform able to run 32- and 64-bit Windows NT and 64-bit UNIX Alpha is the only available 64-bit microprocessor for mixed environments

6. The Intel Agreement DIGITAL and Intel will enter into a 10-year patent cross-licensing agreement Intel has purchased DIGITAL’s semiconductor operations, including state- of-the-art facilities in Hudson, Massachusetts, as well as development operations in Jerusalem, Israel and Austin, Texas DIGITAL will retain its Alpha technology and Alpha-related semiconductor design teams Intel will manufacture DIGITAL-designed Alpha microprocessors for DIGITAL systems under a long-term supply contract Intel will continue to provide Intel products and comprehensive technical support to DIGITAL in support of DIGITAL’s Intel business DIGITAL will develop a full line of systems based on Intel’s IA 64 architecture DIGITAL will port, with technical assistance from Intel, its industry-leading DIGITAL UNIX to Intel’s IA 64 architecture DIGITAL will work with Microsoft as it develops a common programming model for 64-bit Windows NT for Alpha and IA 64 architectures

7. FTC Ensures That Digital's Alpha Chip -- a Key Rival to Intel's Chips -- Remains Competitive Washington DC, April 23, 1998 - A proposed agreement to resolve Federal Trade Commission antitrust concerns arising from Intel Corporation's acquisition of Digital Equipment Corporation's microprocessor assets would preserve competition in the microprocessor market by ensuring the viability of Digital's Alpha chip, regarded by many as the fastest microprocessor in the world. The sale, the agency said, would have threatened competition by placing production of the Alpha chip solely in the hands of Digital's principal competitor, Intel -- possibly endangering the continuing and future development of the Alpha technology. The proposed settlement would resolve these concerns by requiring that Digital license Alpha technology to Advanced Micro Devices, a developer and producer of high performance microprocessors, and to Samsung Electronics, a developer and producer of semiconductors, or some other Commission-approved licensees. Digital also would be required to begin the process of certifying International Business Machines, or another Commission- approved company, as an alternative production source for Alpha chips. These licenses would ensure that there are adequate and independent supplies of Alpha microprocessors. According to the Commission, the agency's settlement would ensure that Intel does not have exclusive control over Alpha production, and would further the continuing development of Alpha. "The Commission's order is designed to ensure that Alpha remains a viable competitive alternative to Intel's chips -- by sending a strong message to the market that other major chip makers are now committed to Alpha's future," said Chairman Robert Pitofsky. "By protecting competition, the Commission has preserved consumer choice and encouraged continued innovation in the market for microprocessors."

8. SPECint95 peak 21164 600 MHz 21264.25u EV7 IA-64 IA-64 (Merced) 21264 600 MHz EV8 EV68 19951996199719981999200020012002 10 20 30 40 50 60 70 80 90 100 110 120 130 140 150 160 170 180 190 200 2102200 Relative Performance: Integer (SPECint95-peak) Alpha Processor Updated Roadmap lAlpha will maintain its leadership and remains clear 64-bit choice l64-bit capability on Windows NT 2 years before other vendors get their first 64-bit processors

9. 9 Real Applications EV6/600 vs EV56/625

10. Approaching Scalability in Multiple Ways 8 * 12cpu AS8400 5/625 @1.22 GFlops/CPU = 117 GFlops

11. Source: Gartner Group Conference Presentation, October, 1996, G. Weiss UNIX vs NT?

12. February 199812 Conclusion COMPAQ is committed to Alpha and Digital UNIX Accords with Intel, Samsung and AMD ensure long-term multiple sources for Alpha The latest Alpha implementation confers a significant performance advantage for scientific and technical applications Delays in the “Merced” implementation of IA-64 open a significant window of opportunity for Alpha Clear signals from the market-place that these points have been recognized and understood