Group Backs Palm - Handspring Merger

Palm, Inc. today announced that Institutional Shareholder Services Inc. (ISS), the nation's leading independent proxy advisory firm, has evaluated the transaction and is recommending stockholders approve it.

The transaction would result in the spin-off of PalmSource, Inc., the Palm subsidiary responsible for developing and licensing the world-leading Palm OS platform for handheld computers and smartphones, and the distribution of PalmSource common stock to Palm's stockholders.

The transaction also would result in the acquisition of Handspring, Inc., and the issuance of shares of Palm common stock -- immediately following the PalmSource distribution -- to Handspring stockholders. Following the spin-off of PalmSource and the acquisition of Handspring, Palm, Inc. will assume a new name, palmOne, Inc. palmOne will offer the broadest portfolio of mobile computing and communication devices in the industry. Products will bear one of the company's three subbrands: Zire, aimed at consumers and multimedia enthusiasts; Tungsten, targeting mobile professionals and business; and Treo, the subbrand for smartphones, which are marketed to both individuals and businesses.

palmOne"We appreciate ISS' concurrence that the proposed Palm transaction warrants stockholders' support," said Eric Benhamou, Palm chairman and interim chief executive officer.

"Palm is confident the transaction will result in the creation of the leading handheld-software platform company and an even stronger market leader in mobile devices and solutions. We believe these 'pure-play' companies will attract new sets of investors and lead to increased stockholder value," Benhamou said.

The ISS report to Palm stockholders concluded that, "The PalmSource distribution allows both software and hardware groups to focus on each company's respective business plans and products. Also, the merger of Palm's Solutions Group with Handspring would allow for a stronger combined company with the potential strategic synergies. Therefore, we believe the transaction warrants shareholder support."

ISS recommends that Palm stockholders vote in favor of the transaction, which comprises the spin-off and the acquisition. The date Oct. 28 has been set for the Palm Annual Stockholders Meeting. Separately, Handspring stockholders will vote on the acquisition of Handspring by Palm also on Oct. 28.

Palm stockholders of record as of Sept. 23 are eligible to vote on the transaction. Palm stockholders of record as of Oct. 28 are eligible to receive shares of stock of PalmSource.

PalmSource common stock currently is quoted on a when-issued basis on the Over-the-Counter Bulletin Board. The ticker on Bloomberg's or Nasdaq's web site is PSRCV, and on Yahoo! Finance it is PSRCV.OB. Once the transaction has closed, PalmSource stock is approved to trade on Nasdaq under the ticker symbol PSRC.

The ticker symbol for palmOne will be PLMO, beginning after Oct. 28.

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What's gonna become of the Palm Tungsten W....

vesther @ 10/14/2003 9:18:06 PM #
A PalmOne Treo....

Sounds interesting.....

My only concern, though, is what is going to happen to the saddened Palm Tungsten W if for any reason the Stockholders approve the Merger, though, because if Palm's and Handspring's stockholders approve the merger, then it is more likely that the stockholders and/or designers will have to make a decision whether or not to keep on supporting the Tungsten W or not because the Tungsten W is actually a Pseudo-Smartphone, but you have to use a Handsfree Handset in order to use it, plus it runs on Palm OS 4.1.1.

Certain Palm Tungsten W loyalists will be hurt if the W line gets discontinued as a result of the Palm and Handspring Merger since with Handspring, the Treo will take over Palm's Smartphone Niche.

The Palm Tungsten C is going to stay (on a side-note) no matter what happens thanks to Wi-Fi, but if a Palm-Handspring Merger is approved by the Stockholders, then I would like to see a Treo Smartphone with Bluetooth, Wi-Fi, AND either Verizon Wireless OR Nextel Service included (There should be a Nextel version of the Handspring Treo in the future).

Those of you who own a Palm Tungsten W, prepare to get worried right now.

My Primary Handheld: Palm Tungsten C "Eurenzannig"
My Secondary Handheld: Palm Tungsten T "Mautenzannig"

RE: What's gonna become of the Palm Tungsten W....
ganoe @ 10/15/2003 5:31:55 AM #
I'd really like to see Palm replace the W with a W2 that adds Bluetooth (including the headset profile) and running Palm OS 5 (or preferably 6). Of course have a nice rechargable Bluetooth headset as an option (or included).

Then if they'd just do a CDMA version that worked with Verizon ...

I'd much rather have something like that than the Treo 600. It's unclear to me if Handspring has/had plans to update the rest of the Treo line.

RE: What's gonna become of the Palm Tungsten W....
vesther @ 10/15/2003 10:15:07 PM #
Hmmmm....IMO if there's going to be an update to the Palm Tungsten's what I have to think about....

* Freedom of Choice. Have this Handheld with Nextel, Verizon, US Cellular, T-Mobile, or even Cingular Service. Not just AT&T M-Life Service. Some Business Execs would use the added convenience of a Handheld while they are using a Nextel Telephone.

* Latest Palm OS Available. Either OS 5.2.x or OS 6 should be nice.

* Intel ARM Processor. The Motorola Dragonball Processor hurted the Tungsten W. I want to see the new Tungsten W to use an Intel PXA263 Processor instead of a Dragonball Processor.

* At least 128MB Memory (Minimum 112MB Available). Enough to help Business Execs get critical work all done in a hurry.

* Stereo Output with Mic--Imagine getting 2-Channel Sound, using a Mic, PLUS (if you have Nextel) Direct Connect...that would be sweet.....

* Bluetooth is a plus, but keep in mind that Bluetooth has some issues as I speak.

In practice, I'd rather get a Handspring Treo 600 if I had AT&T M-Life Service as of this point since the Palm Tungsten W is rather weak to my tastes.

So IMO here's what I should declare for the Palm Tungsten W2 Regular:
* Bluetooth a Plus
* 128MB Intel StrataFlash RAM
* 64MB Intel StrataFlash ROM
* 400MHz Intel PXA263 Processor
* Choice of CDMA, GSM, GPRS, Nextel iDEN, or even High-Speed PCS
* Stereo Headjack with included Stereo Headphones plus Microphone

The Tungsten W2 Professional should have the same features as with the Tungsten W2 Regular, but adds Wi-Fi with the package, but I'm not sure because that's a Tungsten C killer I'm saying over here.

My Primary Handheld: Palm Tungsten C "Eurenzannig"
My Secondary Handheld: Palm Tungsten T "Mautenzannig"

RE: What's gonna become of the Palm Tungsten W....
antikryst @ 10/16/2003 2:46:09 AM #
the TW will be phased out. all Palm or PalmOne pda/phone compo will be labeled as treos

thats what i think :D

Early Merger?

ocspub @ 10/16/2003 11:19:54 PM #
Well, I got my Treo 600 from Handspring today. The Fedex package had a sticker on it indicating that it was sent from pa1mOne somewhere in Utah. Looks like they are already in the process of combining operations, even though I (one of their important minority shareholders) haven't approved it yet ;-)



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