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Technology Stocks : PALM - The rebirth of Palm Inc. -- Ignore unavailable to you. Want to Upgrade?

To: P.M.Freedman who wrote (4041)	3/6/2001 6:43:46 PM
From: Mang Cheng	Read Replies (1) \| Respond to of 6784

"Palm Inc. In Definitive Pact To Buy Extended Sys" Dow Jones Newswires SANTA CLARA, Calif. -- Palm Inc. (PALM) entered a definitive agreement to acquire Extended Systems Inc. (XTND), a mobile enterprise vendor, in a $264 million stock transaction. In a press release Tuesday, Palm said shareholders of Extended Systems, Boise, Idaho, would receive $22 in Palm stock for each share, subject to certain collars. If the average closing price of Palm stock is greater than $22, the stock exchange ratio will be 1-for-1. If Palm's average closing price is less than $16.60, each Extended Systems share will swap for 1.325 Palm shares. The transaction is subject to regulatory and Extended Systems stockholder approvals, and is expected to close in June 2001. Mang's comments: obviously Palm is quite confident that Palm share price will be above $22 by June so as to give out as little shares as possible.

To: P.M.Freedman who wrote (4041)	3/6/2001 6:58:53 PM
From: Mang Cheng	Read Replies (1) \| Respond to of 6784

P.M. I think the XTND purchase is very positive. This deal will diversify Palm further away from a 95% hardware company. Xtnd has a gross margin of 60% which will be good to Palm. Xtnd seems to be having some cashflow problems and running low on cash so it must welcome to swap itself with Palm at this low price. One good thing about xtnd is that it has no debt on its balance sheet. This is also another endorsement of Palm at this price level. Xtnd's management must be believing that by owning Palm they will do much better by owning xtnd going forward ! Also, let's say compaq wants to buy you up and Palm also wants to buy you up, and the terms are equal, who do you want to sell to ? The answer is obvious. Mang