HP To Help Fund, Incubate and Manage Emerging Media and Entertainment Companies With $17 Million Financing Agreement With New Media Venture Partners - Company Financial Information

Edge: Work-Group Computing Report, Feb 7, 2000

Hewlett-Packard Company and New Media Venture Partners (NMVP) Monday announced that HP is providing NMVP with a $17 million financing package to help the Internet media corporation fund, incubate and develop proprietary technology, digital content and e-commerce start-ups. The agreement between HP and NMVP, which positions HP as the preferred technology provider to all NMVP subsidiaries, is one of several relationships that HP is establishing with venture holding companies that focus on targeted Internet areas, such as digital media, education and business-to-business commerce.

HP is making a $2 million equity investment in NMVP and is providing NMVP with up to $15 million in debt financing. HP has already begun working with several NMVP subsidiaries, including Moon Crescent Studios and Virtually EveryThing Inc., to provide HP products and services for their expanding technology infrastructures. The majority of the $17 million funding will finance HP products and services with NMVP subsidiaries.

"Leveraging our $6 billion captive financing organization, we are in the process of building a $1 billion portfolio around high-growth initiatives, including revenue-sharing and venture debt financing for companies that are moving their businesses to the Web or starting in the Internet space," said Craig White, senior vice president and general manager of HP Technology Finance. "Our strategy, which allows HP to establish our technology, support and consulting services at the very heart of mission-critical Internet environments, is to have a positive effect on our customers' long-term success. We want NMVP and other winners in the next chapter of the Internet to be satisfied, loyal HP customers for the long haul."

"Our philosophy is to establish strong relationships with key partners that can provide capital plus leadership in strategic areas," said Scott McKinley, chairman, president and chief executive officer of New Media Venture Partners. "Our focus is on proprietary technology, digital content and media channels -- with the Internet being part of the larger media industry. An alliance with a leading provider of Internet technology infrastructure and services such as HP is going to be enormously beneficial to our subsidiaries."

Moon Crescent Studios

Moon Crescent Studios is an independent digital-animation and live-action entertainment company established by top creative talent in the film, television and music industries. Moon Crescent, the first animation studio set up exclusively with HP equipment, is in the midst of creating its first feature film, "PC and the Web." The live-action and 3-D animated theatrical feature will exclusively use HP servers and storage products and will benefit from HP software and consulting.

Virtually EveryThing Inc.

Virtually EveryThing Inc. (VEI) said that it plans to be the first e-commerce company to facilitate the convergence of off-line and online retailing, offering consumers a brick-and-mortar option for broadband electronic shopping. VEI will build 200 stores in high-traffic locations and install 3,000 shopping kiosks through a store-in-a-store strategy by the end of 2004. HP is providing the start-up with a portfolio of servers and storage products, as well as consulting and software.

New Media Venture Partners is an Internet media corporation focusing on three strategic areas within the B2B marketplace: proprietary technology, digital content, and distribution.

NMVP is a Salt Lake City, Utah based corporation, with nearly 100 employees in its current divisions and affiliates. Information about NMVP can be found on the world wide web at http://www.nmvp.com.

Hewlett-Packard Company -- a leading global provider of computing and imaging solutions and services for business and home -- is focused on capitalizing on the opportunities of the Internet and the proliferation of electronic services.

HP plans to launch Agilent Technologies as an independent company by mid-calendar 2000. Agilent consists of HP's test and measurement, semiconductor products, chemical analysis and healthcare solutions businesses, and has leading positions in multiple market segments.

HP has 83,200 employees worldwide and had total revenue from continuing operations of $42.4 billion in its 1999 fiscal year. Information about HP, its products and the company's Year 2000 program can be found on the World Wide Web at http://www.hp.com.