Filed by Palm, Inc. Pursuant to Rule 425
Under the Securities Act of 1933
And Deemed Filed Pursuant to Rule 14a-12
Under the Securities Exchange Act of 1934
Subject Company: Handspring, Inc.
Registration Statement File No.: 333-106829
During the week of October 13, members of Palm and Handspring management gave the following presentation.
Defining Mobile
Computing
October 2003
Safe Harbor
This presentation includes forward-looking statements
about Palm and its business, including statements
regarding CAGR, worldwide unit sales, palmOne’s
business following the merger and potential growth
opportunities beyond PIM. We caution you that these
statements are subject to risks and uncertainties that
may cause actual events or results to differ materially.
These risks and uncertainties include risks related to
the consummation of the merger, the successful
integration of Handspring and other risks that are
detailed in Palm's filings with the Securities and
Exchange Commission, including its joint proxy
statement/prospectus dated September 26, 2003.
Transaction Overview
One transaction, two components
Step 1: PalmSource Spin-Off – Tax-free
distribution of all PalmSource shares
owned by Palm to Palm's shareholders
only
Step 2: Handspring Acquisition –
Occurs immediately following the spin-
off of PalmSource
Todd Bradley
President and CEO
palmOne
Vision
To create and deliver mobile devices that set you
free from desks and wires so you can work, play
and communicate with family, friends and
colleagues wherever you are.
Handheld computing and communications will be
an essential part of our daily lives.
Mission
The palmOne Opportunity
Clarity of focus key to execution
Extend Market Leadership
Enhance user experience
Drive business innovation
Develop strategic relationships
Achieve Consistent
Profitability
Grow the top line
Design for profitability
Increase Opex productivity
Grow the Market
Attract first-time users
Expand apps beyond PIM
Develop new geographies
Promote convergence
Enter new product segments
Undisputed Market Leadership
We created the category, we will continue to define it
Over 26 million units sold WW
Worldwide distribution
From retail to carrier to web
Leading global market share
40% worldwide*
Larger than HP, Sony, Dell and
Toshiba combined
Leading brands
* IDC, Q2 CY ‘03
Favorable Industry Dynamics
Emerging fast-growing market opportunities
Source: IDC Sept ‘03
8%
27%
61%
Total ‘03-’07
CAGR 41%
CAGR
‘03-’07
Focus on Consistent Profitability
Turnaround well under way, investing towards the future
Top line growth
Expanding customer base
Targeting emerging, high growth segments
Operational discipline and execution
COGS, OCOGS programs
Operating Expense productivity
Working capital management
Acquisition synergies
Ed Colligan
SVP and GM Wireless
Business Unit
Radius, Palm, Handspring
Todd Bradley
Chief Executive Officer
Federal Express, GE Capital,
Gateway
Ken Wirt
SVP and GM Handheld
Business Unit
NEC Technologies, Apple,
Diamond Multimedia Systems
Judy Bruner
Chief Financial Officer
Hewlett-Packard, Ridge Computers,
3COM
Angel Mendez
SVP Global Operations
Allied Signal, GE, Gateway
Jeff Hawkins
Chief Technology Officer
Intel, Grid, Palm, Handspring
Deep Management Bench
Unique industry expertise
Seasoned Board of Directors
Unique track record of company and industry creation
Eric Benhamou – Chairman, palmOne, Inc.
Todd Bradley – President and CEO, palmOne, Inc.
Gordon Campbell – President & Chairman, Techfarm, Inc.
Gareth Chang – Chairman & Partner, GC3 & Assoc. Int’l., LLC
Jean-Jacques Damlamian – SVO, Group Tech. & Innovation,
France Telecom
John Doerr* – General Partner, Kleiner Perkins Caufield &
Byers
Donna Dubinsky* – Former CEO, Handspring
Bruce Dunlevie* – Managing Member, Benchmark Capital
Michael Homer – CEO & Chairman, Kontiki, Inc.
Susan Swenson – President and COO, Leap Wireless Int’l., Inc.
*Current director of Handspring expected to become director of palmOne upon closing of the Handspring acquisition
Ed Colligan
President and COO
Handspring
Once Handspring acquisition closes:
SVP and GM, Wireless Bus. Unit
palmOne
Our Strategic Advantages
Creating differentiation
Relentless focus on customer
Market segmentation
Superb user experience
Innovation that matters
Hardware, Software
Business innovation
Breadth of solutions
Strategic partnering
Focus on core competencies…
…Strategic relationships for the rest
Global reach
Retail, carrier and web
Customer Segmentation
Entry
Enterprise
Personal
Information
Organization
focused
Simple
solutions
Price
conscious
Simple and
convenient access
to data – tethered
or wireless
Minimal
compromises for
mobility
Seamlessly fits into
enterprise
infrastructure
Media Savvy
Media style
and features
Personal
organization
function
Technology
savvy
Professional
Personal and
business
solutions
Style and feature
conscious
Quality and
performance
weighted
Productivity
and
Performance
Connected
Enterprise Data
and Groupware
Personal
Corporate
Media and
Personal
Information
Unmatched Breadth of Solutions Offering
Unique competitive positioning
$99
$299
$199
$329
$399
$499
Carrier
Tungsten E Handheld
Power at an affordable price
Clarity and readability with a high-resolution
320x320 color display
Word, Excel and PowerPoint compatible files
on the go
Photos, MP3 and video
ARM processor- 32 MB
"...the company hit one out of the park with the Tungsten
E. This elegant, slim $199 device is the best buy Palm's
ever offered.“
Rob Pegoraro, 10/05/03
Washington Post
Tungsten T3
Flexible, powerful and connected
Stunning 320x480 screen (twice that of
competitors)
Works in portrait and landscape mode
Uncompromising business and multimedia
performance – 400 MHz. XScale processor, 64MB
memory
Best-in-class office compatibility: Outlook, Word,
Excel, PowerPoint
Robust software suite: Photos, Video, MP3, e-mail,
browser
Built-in Bluetooth wireless
"I predict that the T3 will be a hot holiday item this year,
and Palm deserves credit for doing its part to keep hand-
held computing fresh and vital.“
Mark Kellner, 10/07/03
The Washington Times
Treo 600 Smartphone
Great phone, great messaging and no compromise
Proven Innovation
Third generation of Treo smartphones
Leadership in emerging, high-growth category
Integration of functionality
Phone integration with address book
Integration of messaging: SMS+ and e-mail
Photos, video and MP3
Carriers to date
Sprint, AT&T, Cingular, T-Mobile, Orange
"I've been carrying a Sprint Treo 600 around for a couple
of weeks and I love it. It's a great phone, an excellent
mobile e-mail terminal and a full-fledged Palm-compatible
PDA. I prefer it to any RIM BlackBerry model I have tested,
and it blows away any of the PDA/phones based on
Microsoft's Pocket PC operating system.“
Walt Mossberg, 9/18/03
Wall Street Journal
Smartphones Are Strategic to Carriers
“Handspring is a program partner, not a device supplier. Every
other vendor takes purely a hardware approach.” -- Carrier
Voice
SMS
Backup
Multimedia
Gaming
Photo Manager
Full Web
Browsing
News
Stocks
Currency
Weather
Web
-based
Apps
Voice
SMS
MMS
POP3
e-mail
Corporate
e-mail
Treo 600 E-mail Solutions
Carrier based, server based, redirector based
Handspring
POP3 client in the box
Good Technology
Full Outlook Synchronization
Seven
Sprint PCS Business Connection
Outlook, Lotus Notes, IMAP
Visto
Treo Mail client support
Lotus Domino compatibility
Others
Outlook, Lotus Notes, GroupWise , more….
Judy Bruner
SVP and CFO
palmOne
Focus on Stockholders’ Value
Achieve
Profitability
Scale
Gross Margin
OpEx
Productivity
Manage
Working Capital
Grow the Market
Expanding customer base – paper
replacement, and up sell
Innovation – WAN, LAN, PAN, ARM,
Screens, Multimedia, Messaging
Smartphone – emerging market
Geographic and channel expansion –
China, Brazil, Web, Palm Cafés
Improve Gross Margin/Operating
Expense
Design for profitability
OCOGS improvements
Product life cycle management
Consistent Management of Cash-
to-cash Conversion Cycle
Inventory, receivables and
payables
Solutions Group Operating Results
Q1 ’04 reflects Y/Y revenue increase and reduction in loss
*Other charges include separation costs, amortization of intangibles, impairment and restructuring charges.
Q1 '03
Q2 '03
Q3 '03
Q4 '03
Q1 '04
Revenue
164.7
257.9
197.9
217.1
168.6
Y/Y %
-21%
-10%
-30%
-4%
2%
Gross Profit
37.6
70.2
47.1
57.5
47.4
% of Rev
23%
27%
24%
26%
28%
R&D, S&M, G&A
69.1
66.6
68.3
65.4
60.2
% of Rev
42%
26%
35%
30%
36%
Other Charges
1.2
(0.8)
141.3
3.6
3.5
% of Rev
1%
0%
71%
2%
2%
Op Inc - GAAP
(32.6)
4.4
(162.5)
(11.5)
(16.4)
% of Rev
-20%
2%
-82%
-5%
-10%
Pre-Tax Inc - GAAP
(32.4)
9.2
(165.1)
(10.9)
(16.5)
% of Rev
-20%
4%
-83%
-5%
-10%
Handspring Operating Results – Q1 ’04
Reflect strategic and product transition
*Other charges include amortization of deferred stock compensation and restructuring charges.
Q1 '04
Revenue
13.1
Gross Profit
2.4
% of Rev
18%
R&D, SG&A
16.3
% of Rev
125%
Other Charges
0.8
% of Rev
6%
Op Inc - GAAP
(14.7)
% of Rev
-112%
Pre-Tax Inc - GAAP
(14.0)
% of Rev
-107%
Revenue reflects initial
shipments of Treo 600
GM reflects start-up
volumes & wind-down of
older product lines
GM expected to improve
considerably as Treo 600
ramps
On-track to realize $25M in
annual synergies from
combined company
Emphasis on Operational Discipline
Improving gross margins, lowering costs, reducing inventory
Implemented “Should Cost” program
Shifted production to lower cost footprint
Leveraged system tools, implemented new
systems
Developed demand management processes
Re-tooled organization
Shifting Customer Support to lower
cost/higher performance footprint
Solutions Group Inventory and Turns
Operational discipline produces meaningful improvements
Solutions Group Working Capital
Cash-to-cash conversion cycle consistently low single digits
Upcoming Milestones
Stockholders vote: October 28, ‘03, CA
Transaction closes October 28 after close of market
(subject to stockholders approval)
Analyst meeting: November 7, ‘03, NY
Q2 FY’04 Results: December 18, ‘03
Three month Solutions Group results, one month of
Handspring results
Purchase accounting
Discontinued operations for historical PalmSource
The palmOne Opportunity
Market leader
Leading global share (scale)
Breadth of solutions offering, breadth of distribution
Leading brands
Large, growing market
Expanding demographics
Emerging geographies and product segments
Wireless ubiquity – PAN, LAN and WAN
Focus on Profitability
Operational discipline and execution
Experienced management and board
Management bench with unique industry expertise
Board with unique track record of company and industry creation
Defining Mobile
Computing
Questions and Answers
Additional Information and Where to Find It
On July 3, 2003, in connection with the proposed reorganization transaction involving Palm, PalmSource and Handspring, Palm filed with the SEC a Registration Statement on Form S-4 containing a proxy statement/prospectus. In addition, on July 3, 2003, PalmSource filed with the SEC a Registration Statement on Form S-4 containing a prospectus relating to the distribution of PalmSource shares to the existing stockholders of Palm. Investors and security holders are urged to read these filings, and any amendments to these filings, because they contain important information about the reorganization transaction described herein. Investors and security holders may obtain free copies of these documents and other documents filed with the SEC at the SEC’s web site at www.sec.gov. In addition, investors and security holders may obtain free copies of the documents filed with the SEC by Palm by contacting of Palm Investor Relations (877.696.7256 or palm.ir@corp.Palm.com). Investors and security holders may obtain free copies of the documents filed with the SEC by Handspring by contacting Handspring Investor Relations (Bill Slakey at 650.230.5000 or bslakey@Handspring.com). Investors and security holders may obtain free copies of the documents filed with the SEC by PalmSource by contacting PalmSource Investor Relations (Kip Meintzer at 408.400.3000 or Kip.Meintzer@Palmsource.com).
Palm and its directors and executive officers may be deemed to be participants in the solicitation of proxies from the stockholders of Palm and Handspring in connection with the reorganization transaction described herein. Information regarding the special interests of these directors and executive officers in the reorganization transaction described herein is set forth in the joint proxy statement/prospectus dated September 26, 2003, as such filing may be amended from time to time. PalmSource and its directors and executive officers also may be deemed to be participants in the solicitation of proxies from the stockholders of Palm and Handspring in connection with the reorganization transaction described herein. Information regarding the special interests of these directors and executive officers in the reorganization transaction described herein is set forth in the joint proxy statement/prospectus dated September 26, 2003. This document is available free of charge at the SEC’s web site at www.sec.gov and from Palm by contacting Palm Investor Relations (877.696.7256 or palm.ir@corp.Palm.com).