COMPAQ  COMPUTER  CORPORATION
                         EMPLOYEE  STOCK  PURCHASE  PLAN

1.     PURPOSE.
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     The  purpose  of  this  Plan  is to provide an opportunity for Employees of
Compaq  Computer Corporation and its Designated Subsidiaries, to purchase Common
Stock of Compaq and thereby to have an additional incentive to contribute to the
prosperity of Compaq.  It is the intention of Compaq that the Plan qualify as an
"Employee Stock Purchase Plan" under section 423 of the Internal Revenue Code of
1986,  as  amended  (the  "Code"),  although  Compaq  makes  no  undertaking nor
representation  to  maintain  such  qualification.  In  addition,  this  Plan
authorizes  the  grant  of  options  and  issuance  of Common Stock which do not
qualify  under  section  423  of  the  Code pursuant to sub-plans adopted by the
Committee  designed  to  achieve  desired  tax or other objectives in particular
locations  outside  the  United  States.

2.     DEFINITIONS.
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     (a)     "BOARD"  shall  mean  the  Board  of  Directors  of  Compaq.
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     (b)     "CODE" shall mean the Internal Revenue Code of 1986, of the U.S.A.,
              ----
as  amended.

     (c)     "COMMITTEE"  shall  mean  the  committee  appointed by the Board in
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accordance  with  Section  12  of  the  Plan.

     (d)     "COMMON  STOCK"  shall  mean  the common stock of Compaq, par value
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$.01,  or  any  stock  into  which  such  Common  Stock  may  be  converted.

     (e)     "COMPAQ"  shall  mean  Compaq  Computer  Corporation,  a  Delaware
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corporation.

     (f)     "DESIGNATED  SUBSIDIARY"  shall  mean any Subsidiary which has been
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designated  by the Committee as eligible to participate in the Plan with respect
to  its  Employees.

     (g)     "EMPLOYEE"  shall  mean  an individual classified as an employee by
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Compaq  or  a  Designated  Subsidiary  on  the  payroll records of Compaq or the
Designated  Subsidiary  during  the  relevant  participation  period.

     (h)     "OFFERING  DATE" shall mean the first business day of each Purchase
              --------------
Period.

     (i)     "FAIR  MARKET  VALUE"  shall  mean the value of one share of Common
              -------------------
Stock  on  the  relevant  date,  determined  as  follows:

          (1)     If  the shares are traded on an exchange (including the NASDAQ
National  Market  System),  the  reported  "closing  price" on the relevant date
(e.g.,  the  Offering  Date  or  Purchase  Date)  assuming  it is a trading day;
otherwise  on  the  next  trading  day;

          (2)     If  the  shares  are  traded over-the-counter with no reported
closing  price,  the mean between the lowest bid and the highest asked prices on
said  System on the relevant date assuming it is a trading day; otherwise on the
next  trading  day;  and

          (3)     If  neither  (1)  nor  (2)  applies,  the fair market value as
determined  by  the  Committee  in  good  faith.  Such  determination  shall  be
conclusive  and  binding  on  all  persons.

     (j)     "PARTICIPANT"  shall mean a participant in the Plan as described in
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Section  4  of  the  Plan.

     (k)     "PAY"  shall  mean  an Employee's base cash pay (excluding variable
              ---
cash  payments  unless otherwise determined by the Committee) paid on account of
personal services rendered by the Employee to Compaq or a Designated Subsidiary,
plus  pre-tax  contributions  of  the Employee which are part of deferred pay or
benefit  plans  maintained  by  Compaq  or  a  Designated  Subsidiary,  with any
modifications  determined  by  the  Committee.  The  Committee  shall  have  the
authority  to determine and approve all forms of pay (such as commissions) to be
included in the definition of Pay and may change the definition on a prospective
basis.

     (l)     "PLAN"  shall  mean this Compaq Computer Corporation Employee Stock
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Purchase  Plan.

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     (m)     "PURCHASE  DATE"  shall mean the last business day of each Purchase
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Period.

     (n)     "PURCHASE  PERIOD"  shall  mean  a  three-month, six-month or other
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period as determined by the Committee; provided, however, that in no event shall
the  Purchase  Period  be  for a period of longer than twenty-seven (27) months.
The  first  period shall commence on the Plan's first Offering Date, which shall
be  as soon as administratively practicable after the Effective Date, and end on
the  Purchase  Date.

     (o)     "SHAREHOLDER" shall mean a record holder of shares entitled to vote
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shares  of  Common  Stock  under  Compaq's  bylaws.

     (p)     "SUBSIDIARY"  shall  mean  any  subsidiary  corporation (other than
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Compaq) in an unbroken chain of corporations beginning with Compaq, as described
in  Code  section  424(f).

3.     ELIGIBILITY.
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     Any Employee regularly employed on a full-time or part-time basis by Compaq
or  by  any  Designated  Subsidiary  on  an  Offering  Date shall be eligible to
participate  in  the Plan with respect to the Purchase Period commencing on such
Offering  Date,  provided  that the Committee may establish administrative rules
requiring  that  employment  commence  some  minimum  period  (e.g., one month's
employment)  prior  to  an  Offering  Date  for  the  Employee to be eligible to
participate  with respect to the Purchase Period beginning on that Offering Date
and provided further that (1) the Committee may exclude part-time Employees from
participation  pursuant  to criteria and procedures established by the Committee
and (2) the Committee may impose an eligibility period on participation of up to
two  years employment with Compaq and/or a Designated Subsidiary with respect to
participation  on  any  prospective Offering Date.  The Board also may determine
that  a  designated  group  of  highly  compensated  Employees are ineligible to
participate  in  the  Plan  so  long  as  the  excluded category fits within the
definition of "highly compensated employee" in Code section 414(q).  An Employee
shall  be  considered  employed on a full-time basis unless his or her customary
employment  is less than 20 hours per week or five months per year.  No Employee
may  participate  in  the  Plan  if  immediately  after an option is granted the
Employee  owns  or  is  considered  to  own  (within the meaning of Code section
424(d)),  shares  of  capital  stock,  including  stock  which  the Employee may
purchase  by  conversion  of convertible securities or under outstanding options
granted  by  Compaq,  possessing five percent (5%) or more of the total combined
voting  power  or  value  of  all  classes  of  stock of Compaq or of any of its
Subsidiaries.  All  Employees  who  participate  in the Plan shall have the same
rights  and  privileges  under  the  Plan  except  for  differences which may be
mandated  by  local  law  and  which are consistent with Code section 423(b)(5);
provided,  however,  that Employees participating in a sub-plan adopted pursuant
to  Section  13 which is not designed to qualify under Code section 423 need not
have  the  same  rights  and  privileges  as Employees participating in the Code
section  423  Plan.  The  Committee  may  impose restrictions on eligibility and
participation  of  Employees  who  are  officers  and  directors  to  facilitate
compliance  with  federal  or  state  securities  laws  or  foreign  laws.

4.     PARTICIPATION  AND  WITHDRAWAL.
       ------------------------------
     4.1     An  Employee  who  is  eligible  to  participate  in  the  Plan  in
accordance  with  Section  3  may  become  a  Participant  by  filing, on a date
prescribed  by  the  Committee prior to an applicable Offering Date, a completed
payroll  deduction  authorization and Plan enrollment form provided by Compaq or
by  following  an  electronic  or  other enrollment process as prescribed by the
Committee.  An eligible Employee may authorize payroll deductions at the rate of
any  whole  percentage of the Employee's Pay, not to exceed ten percent (10%) of
the  Employee's  Pay, or such greater percentage, as specified by the Committee,
as  apply  to  a  Purchase  Period.  The  Committee  may  provide for a separate
election  (of  a  different  percentage)  for  a specified item or items of Pay,
including  profit  sharing payments, if any.  All payroll deductions may be held
by  Compaq  and commingled with its other corporate funds.  No interest shall be
paid  or  credited  to  the  Participant with respect to such payroll deductions
except  where  required by local law as determined by the Committee.  A separate
bookkeeping account for each Participant shall be maintained by Compaq under the
Plan  and  the amount of each Participant's payroll deductions shall be credited
to  such  account.  A Participant may not make any additional payments into such
account.  Unless  otherwise  specified by the Committee, payroll deductions made
with  respect  to  employees paid in currencies other than U.S. dollars shall be
accumulated in local (non-U.S.) currency and converted to U.S. dollars as of the
Purchase  Date.

     4.2     Unless  otherwise  determined  by  the Committee, a Participant may
decrease  his  or  her rate of payroll deductions at any time in accordance with
procedures  prescribed  by the Committee.  A Participant may increase his or her
rate  of  payroll  deductions only effective on the first payroll date following
the  next Purchase Date by filing a new payroll deduction authorization and Plan

<PAGE>
enrollment form or by following electronic or other procedures prescribed by the
Committee.  If a Participant has not followed such procedures to change the rate
of  payroll  deductions,  the  rate  of payroll deductions shall continue at the
originally  elected  rate  throughout  the  Purchase  Period and future Purchase
Periods  (or  any  lower  maximum  rate  then  in  effect).

     4.3     (a)    Under  procedures  established  by  the  Committee,  a
Participant  may  discontinue  participation  in  the  Plan at any time during a
Purchase  Period  by completing and filing a new payroll deduction authorization
and  Plan  enrollment  form  with  Compaq  or  by  following electronic or other
procedures  prescribed by the Committee.  If a Participant has not followed such
procedures to discontinue the payroll deductions, the rate of payroll deductions
shall continue at the originally elected rate throughout the Purchase Period and
future  Purchase  Periods  (or  any  lower  maximum  rate  then  in  effect).

             (b)   If a Participant discontinues participation during a Purchase
Period,  his  or  her accumulated payroll deductions will remain in the Plan for
purchase of shares as specified in Section 6 on the following Purchase Date, but
the  Participant  will  not  again participate until he or she re-enrolls in the
Plan.  Alternatively,  participants  may  request  a cash distribution of monies
accumulated  but not yet distributed by following such procedures, electronic or
otherwise,  as  specified  by  the Committee.  The Committee may establish rules
limiting  the  frequency  with  which  Participants  may  discontinue and resume
payroll  deductions  under  the  Plan  and  may  impose  a  waiting  period  on
Participants wishing to resume payroll deductions following discontinuance.  The
Committee also may change the rules regarding discontinuance of participation or
changes  in  participation  in  the  Plan.

            (c)   In the event any Participant terminates employment with Compaq
or  any Subsidiary for any reason (including death) prior to the expiration of a
Purchase Period, the Participant's participation in the Plan shall terminate and
all  accumulated  payroll deductions credited to the Participant's account shall
be  paid to the Participant or the Participant's estate without interest (except
where  required by local law).  Whether a termination of employment has occurred
shall  be  determined  by the Committee.  The Committee also may establish rules
regarding  when  leaves  of  absence  or  change  of  employment  status will be
considered  to  be  a termination of employment, and the Committee may establish
termination  of  employment  procedures  for  this Plan which are independent of
similar  rules  established  under  other  benefit  plans  of  Compaq  and  its
Subsidiaries.  In  the  event  of a Participant's death, any accumulated payroll
deductions will be paid, without interest, to the estate or legal representative
of  the  Participant.

5.     OFFERING.
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     5.1     The  maximum  number  of shares of Common Stock which may be issued
pursuant  to  the  Plan  shall  be  25,000,000  shares.

     5.2     Each  Purchase Period shall be determined by the Committee.  Unless
otherwise  determined  by  the  Committee, the Plan will operate with successive
semi-annual  Purchase Periods commencing as soon as administratively practicable
after  the  Effective  Date, although the Committee may pilot the program with a
shorter  initial  Purchase Period.  The Committee shall have the power to change
the  duration  of  future  Purchase  Periods,  without shareholder approval, and
without  regard  to  the  expectations  of  any  Participants.

     5.3     With  respect  to  each Purchase Period, each eligible Employee who
has elected to participate as provided in Section 4.1 shall be granted an option
to purchase the number of shares of Common Stock which may be purchased with the
payroll  deductions  accumulated  in  an  account  maintained  on behalf of such
Employee  during each Purchase Period at the purchase price specified in Section
5.4  below,  subject  to  the  limitation  contained  in  this  Section  5.3.
Notwithstanding  any  other  provision  of the Plan to the contrary, no Employee
participating  in  the  Code  section  423  Plan  shall  be granted an option to
purchase  Common  Stock  under the Plan and all employee stock purchase plans of
Compaq  and  its Subsidiaries at a rate which exceeds $25,000 of the Fair Market
Value  of  such Common Stock (determined at the time such option is granted) for
each  calendar  year  in  which  such  option  is  outstanding at any time.  The
foregoing  sentence  shall  be  interpreted  so  as  to comply with Code section
423(b)(8).

     5.4     The  option  price  under  each option shall be the lower of: (i) a
percentage  (not  less  than  eighty-five  percent  (85%))  established  by  the
Committee ("Designated Percentage") of the Fair Market Value of the Common Stock
on  the  Offering  Date  on  which  an option is granted, or (ii) the Designated
Percentage  of  the  Fair Market Value of the Common Stock on the Purchase Date.
The  Committee  may  change the Designated Percentage with respect to any future
Purchase  Period, but not below eighty-five percent (85%), and the Committee may
determine  with respect to any prospective Purchase Period that the option price
shall  be the Designated Percentage of the Fair Market Value of the Common Stock
on  the  Purchase  Date.

<PAGE>
6.     PURCHASE  OF  STOCK.
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     Upon  the  expiration of each Purchase Period, a Participant's option shall
be  exercised  automatically  for  the  purchase  of  that  number  of  full and
fractional  shares  of  Common  Stock  which  the accumulated payroll deductions
credited  to  the  Participant's  account  at  that  time  shall purchase at the
applicable  price  specified  in  Section  5.4,  subject  to  Section  5.3.

7.   PAYMENT  AND  DELIVERY.
     ----------------------
     Upon  the exercise of an option on each Purchase Date, Compaq shall deliver
(by  electronic  or other means) to the Participant a record of the Common Stock
purchased,  except as specified below.  The Committee may permit or require that
shares  be  deposited  directly  with a broker designated by the Committee (or a
broker  selected  by the Committee) or to a designated agent of the Company, and
the  Committee  may  utilize  electronic or automated methods of share transfer.
The  Committee may require that shares be retained with such broker or agent for
a  designated  period of time (and may restrict dispositions during that period)
and/or  may  establish  other  procedures  to  permit  tracking of disqualifying
dispositions  of  such  shares  or  to  restrict  transfer  of such shares.  The
Committee  may  require that shares purchased under the Plan shall automatically
participate  in  a  dividend  reinvestment plan or program maintained by Compaq.
Compaq  shall  retain  the  amount of payroll deductions used to purchase Common
Stock  as  full  payment for the Common Stock and the Common Stock shall then be
fully  paid and non-assessable.  No Participant shall have any voting, dividend,
or other shareholder rights with respect to shares subject to any option granted
under  the  Plan  until the shares subject to the option have been purchased and
delivered  to  the  Participant  as  provided  in  Section  7.

8.   RECAPITALIZATION.
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     8.1     If  after  the  grant  of  an  option, but prior to the purchase of
Common  Stock  under the option, there is any increase or decrease in the number
of  outstanding shares of Common Stock because of a stock split, stock dividend,
combination  or  recapitalization  of  shares  subject to options, the number of
shares to be purchased pursuant to an option, the share limit of Section 5.3 and
the  maximum  number of shares specified in Section 5.1 shall be proportionately
increased or decreased, the terms relating to the purchase price with respect to
the  option  shall  be  appropriately adjusted by the Board, and the Board shall
take  any  further  actions  which,  in  the  exercise of its discretion, may be
necessary  or  appropriate  under  the  circumstances.

     8.2     The  Board,  if  it  so  determines  in  the  exercise  of its sole
discretion,  also  may  adjust the number of shares specified in Section 5.1, as
well  as  the price per share of Common Stock covered by each outstanding option
and  the maximum number of shares subject to any individual option, in the event
Compaq  effects  one  or  more  reorganizations,  recapitalizations,  spin-offs,
split-ups,  rights  offerings  or reductions of shares of its outstanding Common
Stock.

     8.3     The Board's determinations under this Section 8 shall be conclusive
and  binding  on  all  parties.

9.   MERGER,  LIQUIDATION,  OTHER  CORPORATION  TRANSACTIONS.
     -------------------------------------------------------
     9.1     In  the event of the proposed liquidation or dissolution of Compaq,
the  Purchase  Period  then  in progress will terminate immediately prior to the
consummation  of  such  proposed  liquidation  or  dissolution, unless otherwise
provided  by the Board in its sole discretion, and all outstanding options shall
automatically  terminate  and  the  amounts  of  all  payroll deductions will be
refunded  without  interest  to  the  Participants.

     9.2     In  the event of a proposed sale of all or substantially all of the
assets  of Compaq, or the merger or consolidation of Compaq with or into another
corporation,  then in the sole discretion of the Board, (1) each option shall be
assumed  or  an  equivalent  option  shall  be  substituted  by  the  successor
corporation  or  parent  or subsidiary of such successor corporation, (2) a date
established  by  the Board on or before the date of consummation of such merger,
consolidation  or sale shall be treated as an Exercise Date, and all outstanding
options  shall be deemed exercisable on such date or (3) all outstanding options
shall  terminate and the accumulated payroll deductions shall be returned to the
Participants,  without  interest.

<PAGE>
10.  TRANSFERABILITY.
     ---------------
     Options  granted  to  Participants  may not be voluntarily or involuntarily
assigned,  transferred,  pledged, or otherwise disposed of in any way other than
by  will  or  the  laws  of  descent  and  distribution, and any other attempted
assignment,  transfer,  pledge,  or other disposition shall be null and void and
without  effect.  If a Participant in any manner attempts to transfer, assign or
otherwise  encumber  his or her rights or interest under the Plan, other than as
permitted  by  the  Code,  such  act  shall  be  treated  as  an election by the
Participant  to  discontinue  participation in the Plan pursuant to Section 4.3.

11.  AMENDMENT  OR  TERMINATION  OF  THE  PLAN.
     -----------------------------------------
     11.1     The  Plan  shall  continue until April 21, 2009, unless previously
terminated  in  accordance  with  Section  11.2.

     11.2     The Board or the Committee may, in its sole discretion, insofar as
permitted  by  law,  terminate or suspend the Plan, or revise or amend it in any
respect  whatsoever,  except that, without approval of the shareholders, no such
revision  or  amendment  shall:

          (a)     materially  increase the number of shares subject to the Plan,
other  than  an  adjustment  under  Section  8  of  the  Plan;

          (b)     materially  modify  the  requirements  as  to  eligibility for
participation  in  the  Plan,  except  as  otherwise  specified  in  this  Plan;

          (c)     reduce  the purchase price specified in Section 5.4, except as
specified  in  Section  8;

          (d)     extend  the  term  of  the  Plan  beyond the date specified in
Section  11.1;

          (e)     extend  the  maximum  length  of  a  Purchase  Period  beyond
twenty-seven  (27)  months;  or

          (f)     amend  this  Section  11.2  to  defeat  its  purpose.

12.  ADMINISTRATION.
     --------------
     The  Board shall appoint a Committee consisting of at least two members who
will  serve  for  such  period  of  time as the Board may specify and who may be
removed  by  the  Board  at any time.  The Committee will have the authority and
responsibility  for the day-to-day administration of the Plan, the authority and
responsibility  specifically  provided  in  this Plan and any additional duties,
responsibility  and authority delegated to the Committee by the Board, which may
include  any of the functions assigned to the Board in this Plan.  The Committee
may  delegate  to  one  or more individuals the day-to-day administration of the
Plan.  The Committee shall have full power and authority to promulgate any rules
and  regulations  which  it deems necessary for the proper administration of the
Plan,  to interpret the provisions and supervise the administration of the Plan,
to make factual determinations relevant to Plan entitlements, to adopt sub-plans
applicable  to  specified  Subsidiaries  or  locations and to take all action in
connection  with  administration of the Plan as it deems necessary or advisable,
consistent  with  the delegation from the Board.  Decisions of the Board and the
Committee  shall  be  final  and  binding  upon  all participants.  Any decision
reduced  to  writing  and  signed  by a majority of the members of the Committee
shall  be  fully  effective as if it had been made at a meeting of the Committee
duly  held.  Compaq shall pay all expenses incurred in the administration of the
Plan.  No  Board  or  Committee  member  shall  be  liable  for  any  action  or
determination  made in good faith with respect to the Plan or any option granted
thereunder.

13.  COMMITTEE  RULES  FOR  FOREIGN  JURISDICTIONS.
     ---------------------------------------------

     13.1     The  Committee  may  adopt  rules  or  procedures  relating to the
operation  and  administration  of  the  Plan  to  accommodate  the  specific
requirements  of  local laws and procedures.  Without limiting the generality of
the  foregoing,  the  Committee  is  specifically  authorized to adopt rules and
procedures  regarding  handling  of  payroll  deductions,  payment  of interest,
conversion  of  local currency, payroll tax, withholding procedures and handling
of  stock  certificates  which  vary  with  local  requirements.

     13.2     The  Committee  may  also adopt sub-plans applicable to particular
Subsidiaries  or  locations,  which  sub-plans may be designed to be outside the
scope of Code section 423.  The rules of such sub-plans may take precedence over
other  provisions  of  this  Plan, with the exception of Section 5.1, but unless
otherwise  superseded by the terms of such sub-plan, the provisions of this Plan
shall  govern  the  operation  of  such  sub-plan.

14.  SECURITIES  LAWS  REQUIREMENTS.
     ------------------------------
     Compaq  shall  not  be  under any obligation to issue Common Stock upon the
exercise  of  any option unless and until Compaq has determined that: (i) it and
the  Participant  have  taken  all actions required to register the Common Stock
under  the  Securities  Act  of  1933,  or  to  perfect  an  exemption  from the
registration  requirements  thereof;  (ii) any applicable listing requirement of
any  stock  exchange on which the Common Stock is listed has been satisfied; and
(iii)  all  other applicable provisions of state, federal and applicable foreign
law  have  been  satisfied.

<PAGE>
15.  GOVERNMENTAL  REGULATIONS.
     -------------------------
     This  Plan  and Compaq's obligation to sell and deliver shares of its stock
under  the  Plan  shall be subject to the approval of any governmental authority
required  in  connection  with the Plan or the authorization, issuance, sale, or
delivery  of  stock  hereunder.

16.  NO  ENLARGEMENT  OF  EMPLOYEE  RIGHTS.
     -------------------------------------
     Nothing  contained  in  this  Plan shall be deemed to give any Employee the
right  to be retained in the employ of Compaq or any Designated Subsidiary or to
interfere  with  the  right  of Compaq or Designated Subsidiary to discharge any
Employee  at  any  time.

17.  GOVERNING  LAW.
     --------------
     This  Plan  shall  be  governed  by  Texas  law.

18.  EFFECTIVE  DATE.
     ---------------
     This  Plan  shall  be  effective April 22, 1999, subject to approval of the
shareholders  of  Compaq  within  12  months  of  its  adoption  by the Board of
Directors.

<PAGE>