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Technology Stocks : 3Com Corporation (COMS) -- Ignore unavailable to you. Want to Upgrade?

To: David E. Taylor who wrote (43727)	7/6/2000 6:58:15 PM
From: Mang Cheng	Read Replies (2) \| Respond to of 45548

David, I have already recevied a formal letter from my broker confirming the distribution, it says "we have received notification that the company has declared a stock distribution, which is effected by the issuance to sharesholders as of record date, three common shares of Palm for every two common shares of 3 Com held. Cash will be paid in lieu of fractional shares". Notice that the ratio is fixed and they use the term "stock distribution" instead of "stock dividend" now. Option holders will be able to get this "stock distribution", whereas usually option holders do not get the "dividend". Finally they are using the right term which had kept me quite nervous for a while. The FAQ writer really need to be re-educated. Mang

To: David E. Taylor who wrote (43727)	7/6/2000 7:26:22 PM
From: GS_Wall Street	Respond to of 45548

I believe the buy back that COMS announce allowed them to purchase prior to the distribution to buy back shares (mostly stock options exercised by employees) to keep the ratio as close to 1.5 prior to the distribution date. As far as trading prior to next week it looks like a small market maker looking to complete his arb. taking advantage through the OTC pink sheets to capture a large spread/arb. Look for COMSV to be more widely traded next week, but the spread will most likely remain high, MM have to make a profit.