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Technology Stocks : 3Com Corporation (COMS)
COMS 0.00130-18.8%Nov 7 11:47 AM EST
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To: rkral who wrote (41695)3/12/2000 1:47:00 PM
From: David E. Taylor  Read Replies (1) of 45548
 
Ron:

You're right on both counts, and I apologize if anyone was misled by my post.

I should have said that "the underwriters are sitting on their option to purchase an additional 3.45 million shares at the IPO price", and they have 30 days from 3/2/00 to exercise that option. I'll be surprised if they don't, given the demand for the shares, but I haven't yet seen any report that they have in fact done so.

If and when they do exercise the option, the S-1/A gives them the right to do what they like with the shares, so they may or may not "sit on them". In fact they've been able to buy, sell, short sell, or enter into other transactions to stabilize PALM's stock price right from the start.

I also should have noted in my post that up to 7% of the 23 million shares in the IPO (1.61 million) were reserved for sale at the IPO price to directors of 3Com and Palm and to "persons with preexisting strategic or other relationships with Palm". So EB and other directors of COMS/PALM almost certainly hold a chunk of PALM shares in addition to the COMS options/shares I listed in my post. To the extent these insiders purchased PALM IPO shares from this reserved allotment, the 23 million public float is reduced accordingly. Any PALM shares bought by insiders are subject to the 180 lockup period like the 5.921 million in the AOL/MOT/NOK private placement.

Apologies again. It's not good to mix up opinions/beliefs (no matter how strong they may be) with actual facts.

David T.
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