Market Leaders Join to Leverage Legend's Retail Clout in China

BEIJING and SUNNYVALE, Calif., Dec. 10 /PRNewswire-FirstCall/ -- Legend Group Limited ("Legend") (HKSE stock code: 992), a leading technology company that makes China's top-selling computer brand; and PalmSource, Inc. ("PalmSource"), provider of a leading operating system for handhelds and smart phones, and the Palm OS(R) subsidiary of Palm, Inc. (Nasdaq: PALM); have entered into a licensing agreement to incorporate Palm OS software in a new line of Legend products. Under the terms of the agreement, Legend will develop, manufacture and market handheld access devices that will be able to run the thousands of applications available for the Palm OS platform, thus providing a range of mobile information solutions to consumers and enterprises in China.

Since its inception in 1984, Legend has become the leading provider of computers, handheld access devices and IT solutions in China. The company has strong, diversified distribution channels in China. Legend's market share for handheld devices accounted for over 30% in Q3 2002 in China. This agreement is significant due to the fact that according to IDC, the handheld market in China will grow more than 20% per year between now and 2006, with sales rising to more than 5 million units in that year.

Known for the power and ultimate flexibility of its sophisticated, easy-to-use interface, the Palm OS platform is the foundation for over 25 million handheld computers and smart phones sold worldwide. With more than 250,000 software developers registered to create applications for the platform, Palm OS has one of the most active developer communities in the handheld industry. Today, more than 15,000 applications are available for Palm Powered(TM) products -- more than six times the number available for any other handheld platform.

"We're looking forward to working with PalmSource to create the best Palm Powered products for China," said Lu Yan, vice president and general manager of Handheld Device Business at Legend. "Legend is the leading provider of handheld access devices in China. With our unique understanding of the Chinese market and users, we can tailor make the most suitable and user-friendly products for Chinese customers. With its worldwide popularity, ease of use, and open platform, the Palm OS will help promote faster development and adoption of handheld access devices in China."

"Legend is an ideal partner for PalmSource in China because of its leadership, its ability to bring innovative products to market and its outstanding distribution system," said David Nagel, chief executive officer and president of PalmSource. "The combined strength of PalmSource and Legend will open up new opportunities for developers and business partners in China and provide innovative solutions to the very rapidly developing enterprise and consumer markets there."

About PalmSource, Inc.

PalmSource is the company behind Palm OS, one of the world's most successful operating systems for handhelds and smart phones. Licensed by industry leaders -- including Acer, AlphaSmart, ARM, ATI, Fossil, Garmin, GSL, Handera, Handspring, Intel, Kyocera, Legend, MediaQ, Motorola, Palm, Samsung, Sony, Symbol and Texas Instruments -- Palm OS has been shipped on more than 25 million handhelds and smart phones, and given rise to a huge community of users, enterprises, developers and manufacturers, who together make up the Palm Economy. PalmSource's new headquarters are located at 1240 Crossman Ave. in Sunnyvale, Calif. PalmSource is a subsidiary of Palm, Inc. (PALM). More information about PalmSource, Inc., is available at www.palmsource.com. Information about Palm, Inc. is available at www.palm.com/aboutpalm.

About Legend

Legend Group Limited (HKSE stock code: 992; ADR stock code: LGHLY) is the largest IT corporation in China. Legend brand PC accounted for a market share of 27.5% in the PRC market in 2001. The Legend brand PC is also the No. 1 best seller in the Asia Pacific region (excluding Japan) and accounted for a market share of 11.9%. Apart from manufacturing and sales of PCs, the major businesses of Legend also include provision of IT services and Internet services, manufacturing and sales of handheld devices and contract manufacturing business. For additional information on Legend, please visit http://www.legendgrp.com.

NOTE: Palm OS is a registered trademark and Palm Powered is a trademark of PalmSource, Inc. a wholly owned subsidiary of Palm, Inc. Other brands may be trademarks of their respective owners.

SOURCE PalmSource, Inc.