News release

HP Board Declares Regular Dividend, Adopts New Policies

The board of directors of HP (NYSE:HPQ) today declared a regular cash dividend. The board also adopted new policies for senior executive severance agreements and shareowner rights plans (also known as poison pills).

HP's board declared a regular cash dividend of 8 cents per share on the company's common stock. The dividend, the fourth in HP's fiscal year 2003, is payable on Oct. 8, 2003, to shareholders of record as of the close of business on Sept. 17, 2003. HP has approximately 3 billion shares of common stock outstanding.

The new policies are a result of a process that began following the company's annual meeting of shareowners held in April. At the meeting, advisory shareowner proposals relating to severance agreements and poison pills were approved by a majority of shares present and entitled to vote, and HP announced that it would duly consider these recommendations.

Under the new severance policy, HP will seek shareowner approval for future severance agreements, if any, with senior executive officers that provide specified benefits in an amount exceeding 2.99 times the sum of the executive's base salary plus bonus.

HP also announced that its board will submit any poison pill to a shareowner vote, unless the Board, exercising its fiduciary duties under Delaware law, determines that such a submission would not be in the interests of shareowners under the circumstances. HP does not have a poison pill in place.

About HP

HP delivers vital technology for business and life. The company's solutions span IT infrastructure, personal computing and access devices, global services and imaging and printing for consumers, enterprises and small and medium business. For the last four quarters, HP revenue totaled $70.4 billion. More information about HP is available at http://www.hp.com.

This document 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 statements of the plans, intentions, or expectations of the company for future events and any statement of assumptions underlying any of the foregoing. The risks, uncertainties and assumptions referred to above include future circumstances impacting the board's fiduciary duties and other risks that are described from time to time in HP's Securities and Exchange Commission reports, including but not limited to HP's quarterly report on Form 10-Q for the quarter ended April 30, 2003, and subsequently filed reports. If any of these risks or uncertainties materializes or any of these assumptions proves incorrect, results could differ materially from the expectations in these statements. HP assumes no obligation to update these forward-looking statements.