General Assignment and Assumption Agreement - 3Com Corp. and Palm Inc.


                  General Assignment and Assumption Agreement


                                    between



                               3COM CORPORATION


                                      and


                                  PALM, INC.



                             ______________, 2000

 
                               TABLE OF CONTENTS

 
 
                                                                                Page
                                                                                ----
                                                                              
ARTICLE I CONTRIBUTION AND ASSUMPTION........................................      1
                                                                                        
      Section 1.1    Contribution of Assets and Assumption of Liabilities....      1
      Section 1.2    Palm Assets.............................................      2
      Section 1.3    Palm Liabilities........................................      3
      Section 1.4    The Non-US Plan.........................................      5
      Section 1.5    Methods of Transfer and Assumption......................      5
      Section 1.6    Governmental Approvals and Consents.....................      6
      Section 1.7    Nonrecurring Costs and Expenses.........................      7
      Section 1.8    Novation of Assumed Palm Liabilities....................      7
                                                                                   
ARTICLE II LITIGATION........................................................      8
                                                                                   
      Section 2.1    Allocation..............................................      8
      Section 2.2    Cooperation.............................................      8
                                                                                        
ARTICLE III MISCELLANEOUS....................................................      9
                                                                                        
      Section 3.1    Entire Agreement........................................      9
      Section 3.2    Governing Law...........................................      9
      Section 3.3    Notices.................................................      9
      Section 3.4    Parties in Interest.....................................      9
      Section 3.5    Counterparts............................................     10
      Section 3.6    Assignment..............................................     10
      Section 3.7    Severability............................................     10
      Section 3.8    Failure or Indulgence Not Waiver; Remedies Cumulative...     10
      Section 3.9    Amendment...............................................     10
      Section 3.10   Authority...............................................     10
      Section 3.11   Interpretation..........................................     10
      Section 3.12   Conflicting Agreements..................................     11
                                                                                       
ARTICLE IV DEFINITIONS.......................................................     11
                                                                                       
      Section 4.1    3Com Group..............................................     11
      Section 4.2    Action..................................................     11
      Section 4.3    Affiliated Company......................................     11
      Section 4.4    Ancillary Agreement.....................................     11
      Section 4.5    Assets..................................................     11
      Section 4.6    Contracts...............................................     13
      Section 4.7    Delayed Transfer Assets.................................     13
      Section 4.8    Distribution............................................     13
      Section 4.9    Distribution Date.......................................     13
      Section 4.10   Governmental Approvals..................................     13
      Section 4.11   Governmental Authority..................................     13
 

                                      -i-

 
                               TABLE OF CONTENTS
                                  (continued)

 
 
                                                                                Page
                                                                                ----
                                                                              
      Section 4.12   Indemnification and Insurance Matters Agreement.........     13
      Section 4.13   Insurance Policies......................................     13
      Section 4.14   Insured Palm Liabilities................................     13
      Section 4.15   Intellectual Property...................................     14
      Section 4.16   IPO Registration Statement..............................     14
      Section 4.17   Liabilities.............................................     14
      Section 4.18   Local Transfer Agreements...............................     14
      Section 4.19   Non-US Plan.............................................     14
      Section 4.20   OFLs....................................................     14
      Section 4.21   Palm Balance Sheet......................................     15
      Section 4.22   Palm Business...........................................     15
      Section 4.23   Palm Contingent Gain....................................     15
      Section 4.24   Palm Contingent Liability...............................     16
      Section 4.25   Palm Contracts..........................................     16
      Section 4.26   Palm Group..............................................     17
      Section 4.27   Palm Pro Forma Balance Sheet............................     17
      Section 4.28   Person..................................................     17
      Section 4.29   Retained Payables.......................................     17
      Section 4.30   Retained Receivables....................................     17
      Section 4.31   Security Interest.......................................     17
      Section 4.32   Separation..............................................     18
      Section 4.33   Separation Agreement....................................     18
      Section 4.34   Separation Date.........................................     18
      Section 4.35   Subsidiary..............................................     18
      Section 4.36   Taxes...................................................     18
 

                                     -ii-

 
                  GENERAL ASSIGNMENT AND ASSUMPTION AGREEMENT

     This General Assignment and Assumption Agreement (this "Agreement") is
entered into on _________, 2000 between 3Com Corporation, a Delaware corporation
("3Com"), and Palm, Inc., a Delaware corporation ("Palm").  Capitalized terms
used herein and not otherwise defined herein shall have the meanings ascribed to
such terms in Article IV hereof.

                                    RECITALS

     WHEREAS, 3Com hereby and by certain other instruments of even date herewith
transfers or will transfer to Palm effective as of the Separation Date, certain
assets of the Palm Business owned by 3Com in accordance with the Master
Separation and Distribution Agreement dated as of December ___, 1999 between the
3Com and Palm Computing, Inc., a California company (the "Separation
Agreement").

     WHEREAS, it is further intended between the parties that Palm assume
certain of the liabilities related to the Palm Business currently owed by 3Com,
as provided in this Agreement, the Separation Agreement or the other agreements
and instruments provided for in the Separation Agreement.

     NOW, THEREFORE, in consideration of the foregoing and the covenants and
agreements set forth below, the parties hereto agree as follows:
     
                                   ARTICLE I

                          CONTRIBUTION AND ASSUMPTION
    
     Section 1.1    Contribution of Assets and Assumption of Liabilities.

     (a)  Transfer of Assets.  Effective on the Separation Date, 3Com hereby
assigns, transfers, conveys and delivers (or will cause any applicable
Subsidiary to assign, transfer, convey and deliver) to Palm, or, pursuant to
Section 1.4, to any applicable Palm Subsidiary, and Palm hereby accepts from
3Com, or applicable 3Com Subsidiary, and agrees to cause its applicable Palm
Subsidiary to accept, all of 3Com's and its applicable Subsidiaries' respective
right, title and interest in Palm Assets, other than the Delayed Transfer
Assets; provided, however, that any Palm Assets that are specifically assigned
or transferred pursuant to another Ancillary Agreement shall not be assigned or
transferred pursuant to this Section 1.1(a).

     (b)  Assumption of Liabilities.  Effective on the Separation Date, Palm
hereby assumes and agrees faithfully to perform and fulfill (or will cause any
applicable Subsidiary to assume, perform and fulfill), all the Palm Liabilities
owed by 3Com, other than the Delayed Transfer Liabilities, in accordance with
their respective terms. Thereafter, Palm shall be responsible (or will cause any
applicable Subsidiary to be responsible) for all Palm Liabilities held by 3Com,
regardless of when or where such Liabilities arose or arise, or whether the
facts on which they are based occurred prior to,

 
on or after the date hereof, regardless of where or against whom such
Liabilities are asserted or determined (including any Palm Liabilities arising
out of claims made by 3Com's or Palm's respective directors, officers,
consultants, independent contractors, employees or agents against any member of
the 3Com Group or the Palm Group) or whether asserted or determined prior to the
date hereof, and regardless of whether arising from or alleged to arise from
negligence, recklessness, violation of law, fraud or misrepresentation by any
member of the 3Com Group or the Palm Group or any of their respective directors,
officers, employees or agents.

     (c)  Delayed Transfer Assets and Liabilities.  Each of the parties hereto
agrees that the Delayed Transfer Assets will be assigned, transferred, conveyed
and delivered, and the Delayed Transfer Liabilities will be assumed, in
accordance with the terms of the agreements that provide for such assignment,
transfer, conveyance and delivery, or such assumption, after the date of this
Agreement or as otherwise set forth on Schedule 1.1(c).  Following such
assignment, transfer, conveyance and delivery of any Delayed Transfer Asset, or
the assumption of any Delayed Transfer Liability, the applicable Delayed
Transfer Asset or Delayed Transfer Liability shall be treated for all purposes
of this Agreement and the other Ancillary Agreements as a Palm Asset or as a
Palm Liability, as the case may be.

     (d)  Misallocated Assets.  In the event that at any time or from time to
time (whether prior to, on or after the Separation Date), any party hereto (or
any member of such party's respective Group), shall receive or otherwise possess
any Asset that is allocated to any other Person pursuant to this Agreement or
any Ancillary Agreement, such party shall promptly transfer, or cause to be
transferred, such Asset to the Person so entitled thereto. Prior to any such
transfer, the Person receiving or possessing such Asset shall hold such Asset in
trust for any such other Person.

     Section 1.2   Palm Assets.

     (a)  Included Assets.  For purposes of this Agreement, "Palm Assets" shall
mean (without duplication) the following Assets, except as otherwise provided
for in any other Ancillary Agreement or other express agreement of the parties:

          (i)   all Assets reflected in the Palm Balance Sheet, subject to any
dispositions of such Assets subsequent to the date of the Palm Balance Sheet;

          (ii)  all Assets that have been written off, expensed or fully
depreciated that, had they not been written off, expensed or fully depreciated,
would have been reflected in the Palm Balance Sheet in accordance with the
principles and accounting policies under which the Palm Balance Sheet was
prepared;

          (iii) all Assets acquired by 3Com or its Subsidiaries after the
date of the Palm Balance Sheet that would be reflected in the consolidated
balance sheet of Palm as of the Separation Date if such consolidated balance
sheet was prepared using the same principles and accounting policies under which
the Palm Balance Sheet was prepared, including any business transaction

                                      -2-

 
processing that may occur on 3Com systems on behalf of Palm during the period
between separation date to initialization of the processing systems required by
Palm;
          (iv)   all Assets that are used primarily by the Palm Business at the
Separation Date but are not reflected in the Palm Balance Sheet due to mistake
or omission; provided, however, that no Asset shall be a Palm Asset requiring
any transfer by 3Com unless Palm or its Subsidiaries have, on or before the
first anniversary of the Distribution Date, given 3Com or its Subsidiaries
notice that such Asset is a Palm Asset;

          (v)    all Palm Contingent Gains;

          (vi)   all Palm Contracts;

          (vii)  to the extent permitted by law and subject to the
Indemnification and Insurance Matters Agreement, all rights of any member of the
Palm Group under any of 3Com's Insurance Policies or other insurance policies
issued by Persons unaffiliated with 3Com; and

          (viii) all Assets that are expressly contemplated by this Agreement,
the Separation Agreement or any other Ancillary Agreement (or Schedule
1.2(a)(xii) or any other Schedule hereto or thereto) as Assets to be transferred
to Palm or any other member of the Palm Group.

     (b) Excluded Assets.  For the purposes of this Agreement, "Excluded
Assets" shall mean:

          (i)    the Assets listed or described on Schedule 1.2(b)(i);
          
          (ii)   the Retained Receivables; and

          (iii)  any Assets that are expressly contemplated by the Separation
Agreement, this Agreement or any other Ancillary Agreement (or the Schedules
hereto or thereto) as Assets to be retained by 3Com or any other member of the
3Com Group.

     Section 1.3   Palm Liabilities.

     (a) Included Liabilities.  For the purposes of this Agreement, "Palm
Liabilities" shall mean (without duplication) the following Liabilities, except
as otherwise provided for in any other Ancillary Agreement or other express
agreement of the parties:

          (i)    all Liabilities reflected in the Palm Balance Sheet, subject to
any discharge of such Liabilities subsequent to the date of the Palm Balance
Sheet;

          (ii)   all Liabilities of 3Com or its Subsidiaries that arise after
the date of the Palm Balance Sheet that would be reflected in the consolidated
balance sheet of Palm as of the Separation Date if such consolidated balance
sheet was prepared using the same principles and accounting policies under which
the Palm Balance Sheet was prepared;

                                      -3-

 
          (iii)  all Liabilities that are related primarily to the Palm Business
at the Separation Date but are not reflected in the Palm Balance Sheet due to
mistake or unintentional omission; provided, however, that no Liability shall be
considered as a Palm Liability unless 3Com or its Subsidiaries, on or before the
first anniversary of the Distribution Date, has given Palm or its Subsidiaries
notice that such Liability is a Palm Liability;

          (iv)   all Palm Contingent Liabilities;
          
          (v)    all Liabilities (other than Liabilities for Taxes), whether
arising before, on or after the Separation Date, primarily relating to, arising
out of or resulting from:

                    (1) the operation of the Palm Business, as conducted at any
time prior to, on or after the Separation Date (including any Liability relating
to, arising out of or resulting from any act or failure to act by any director,
officer, employee, agent or representative (whether or not such act or failure
to act is or was within such Person's authority));

                    (2) the operation of any business conducted by any member of
the Palm Group at any time after the Separation Date (including any Liability
relating to, arising out of or resulting from any act or failure to act by any
director, officer, employee, agent or representative (whether or not such act or
failure to act is or was within such Person's authority)); or

                    (3) any Palm Assets;

          (vi)   all Liabilities relating to, arising out of or resulting from
any of the terminated, divested or discontinued businesses and operations listed
or described on Schedule 1.3(a)(vi); and

          (vii)  all Liabilities that are expressly contemplated by this
Agreement, Schedule 1.3(a)(vii), the Separation Agreement or any other Ancillary
Agreement (or the Schedules hereto or thereto) as Liabilities to be assumed by
Palm or any member of the Palm Group, and all agreements, obligations and
Liabilities of any member of the Palm Group under this Agreement or any of the
Ancillary Agreements.

Notwithstanding the foregoing, any Liabilities of any Subsidiaries of 3Com
listed on Schedule 2.1(b) of the Separation Agreement shall not be assumed
pursuant to Section 1.2(a), and the Palm Liabilities shall not include the
Excluded Liabilities referred to in Section 1.3(b) below.

     (b) Excluded Liabilities.  For the purposes of this Agreement, "Excluded
Liabilities" shall mean:

          (i)    all Liabilities listed or described in Schedule 1.3(b)(i);
          
          (ii)   the Retained Payables;

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          (iii)   all Insured Palm Liabilities;

          (iv)    all Liabilities that are expressly contemplated by this
Agreement, the Separation Agreement or any other Ancillary Agreement (or the
Schedules hereto or thereto) as Liabilities to be retained or assumed by 3Com or
any other member of the 3Com Group, and all agreements and obligations of any
member of the 3Com Group under the Separation Agreement, this Agreement or any
other Ancillary Agreement.

     Section 1.4  The Non-US Plan.  Each of 3Com and Palm shall take, and shall
cause each member of its respective Group to take, such action as reasonably
necessary to consummate the transactions contemplated by the Non-US Plan
(whether prior to, on or after the Separation Date). Notwithstanding anything in
this Agreement, the Separation Agreement or in any other Ancillary Agreement to
the contrary, no party to a Local Transfer Agreement shall be entitled to
receive or retain any Asset unless such party shall have paid any consideration
contemplated to be paid in connection therewith pursuant to the Non-US Plan.

     Section 1.5  Methods of Transfer and Assumption.

     (a)  Terms of Other Ancillary Agreements Govern.  The parties shall enter
into the other Ancillary Agreements, on or about the date of this Agreement. To
the extent that the transfer of any Palm Asset or the assumption of any Palm
Liability is expressly provided for by the terms of any other Ancillary
Agreement, the terms of such other Ancillary Agreement shall effect, and
determine the manner of, the transfer or assumption. It is the intent of the
parties that pursuant to Sections 1.1, 1.2 and 1.3, the transfer and assumption
of all other Palm Assets and Palm Liabilities, other than Delayed Transfer
Assets and Delayed Transfer Liabilities, shall be made effective as of the
Separation Date; provided, however, that circumstances in various jurisdictions
outside the United States may require the transfer of certain Assets and the
assumption of certain Liabilities to occur in such other manner and at such
other time as the parties shall agree, as provided in Section 1.4 hereof.

     (b)  Mistaken Assignments and Assumptions.  In addition to those transfers
and assumptions accurately identified and designated by the parties to take
place but which the parties are not able to effect prior to the Separation Date,
there may exist (i) Assets that the parties discover were, contrary to the
agreements between the parties, by mistake or omission, transferred to Palm or
(ii) Liabilities that the parties discover were, contrary to the agreements
between the parties, by mistake or omission, assumed by Palm. The parties shall
cooperate in good faith to effect the transfer or re-transfer of such Assets,
and/or the assumption or re-assumption of such Liabilities, to or by the
appropriate party and shall not use the determination that remedial actions need
to be taken to alter the original intent of the parties hereto with respect to
the Assets to be transferred to or Liabilities to be assumed by Palm.  Each
party shall reimburse the other or make other financial adjustments (e.g.,
without limitation, cash reserves) or other adjustments to remedy any mistakes
or omissions relating to any of the Assets transferred hereby or any of the
Liabilities assumed hereby.

                                      -5-

 
     (c)  Documents Relating to Other Transfers of Assets and Assumption of
Liabilities.  In furtherance of the assignment, transfer and conveyance of Palm
Assets and the assumption of Palm Liabilities set forth in Sections 1.5(a) and
(b) and certain other Ancillary Agreements, simultaneously with the execution
and delivery hereof or as promptly as practicable thereafter, (i) 3Com shall
execute and deliver, and shall cause its Subsidiaries in accordance with Local
Transfer Agreements to execute and deliver, such bills of sale, stock powers,
certificates of title, assignments of contracts and other instruments of
transfer, conveyance and assignment as and to the extent necessary to evidence
the transfer, conveyance and assignment of all of 3Com's and its Subsidiaries'
right, title and interest in and to the Palm Assets to Palm and (ii) Palm shall
execute and deliver to 3Com and its Subsidiaries such assumptions of contracts
and other instruments of assumption as and to the extent necessary to evidence
the valid and effective assumption of the Palm Liabilities by Palm.

     Section 1.6   Governmental Approvals and Consents.

     (a)  Transfer In Violation of Laws.  If and to the extent that the valid,
complete and perfected transfer assignment or novation to the Palm Group of any
Palm Assets and Palm Liabilities (or from the Palm Group of any Non-Palm Assets)
would be a violation of applicable laws or require any Consent or Governmental
Approval in connection with the Separation, the IPO or the Distribution, then,
unless 3Com shall otherwise determine, the transfer, assignment or novation to
or from the Palm Group, as the case may be, of such Palm Assets or Non-Palm
Assets, respectively, shall be automatically deemed deferred and any such
purported transfer, assignment or novation shall be null and void until such
time as all legal impediments are removed and/or such Consents or Governmental
Approvals have been obtained. Notwithstanding the foregoing, such Asset shall
still be considered a Palm Asset for purposes of determining whether any
Liability is a Palm Liability; provided, however, that if such covenants or
Governmental Approvals have not been obtained within six months of the
Distribution Date, the parties will use their reasonable commercial efforts to
achieve an alternative solution in accordance with the parties' intentions.
     
     (b)  Transfers Not Consummated Prior to Separation Date.  If the transfer,
assignment or novation of any Assets intended to be transferred or assigned
hereunder, including pursuant to the Non-US Plan, is not consummated prior to or
on the Separation Date, whether as a result of the provisions of Section 1.6(a)
or for any other reason, then the Person retaining such Asset shall thereafter
hold such Asset for the use and benefit, insofar as reasonably possible, of the
Person entitled thereto (at the expense of the Person entitled thereto). In
addition, the Person retaining such Asset shall take such other actions as may
be reasonably requested by the Person to whom such Asset is to be transferred in
order to place such Person, insofar as reasonably possible, in the same position
as if such Asset had been transferred as contemplated hereby and so that all the
benefits and burdens relating to such Palm Assets (or such Non-Palm Assets, as
the case may be), including possession, use, risk of loss, potential for gain,
and dominion, control and command over such Assets, are to inure from and after
the Separation Date to the Palm Group (or the 3Com Group, as the case may be).
If and when the Consents and/or Governmental Approvals, the absence of which
caused the deferral of transfer of any Asset pursuant to Section 1.6(a), are
obtained, the transfer of

                                      -6-

 
the applicable Asset shall be effected in accordance with the terms of this
Agreement and/or such other applicable Ancillary Agreement.

     (c)  Expenses.  The Person retaining an Asset due to the deferral of the
transfer of such Asset shall not be obligated, in connection with the foregoing,
to expend any money unless the necessary funds are advanced by the Person
entitled to the Asset, other than reasonable out-of-pocket expenses, attorneys'
fees and recording or similar fees, all of which shall be promptly reimbursed by
the Person entitled to such Asset.

     Section 1.7   Nonrecurring Costs and Expenses.  Notwithstanding anything
herein to the contrary, any nonrecurring costs and expenses incurred by the
parties hereto to effect the transactions contemplated hereby which are not
allocated pursuant to the terms of the Separation Agreement, this Agreement or
any other Ancillary Agreement shall be the responsibility of the party which
incurs such costs and expenses.

     Section 1.8   Novation of Assumed Palm Liabilities.

     (a)  Reasonable Commercial Efforts.  Each of 3Com and Palm, at the request
of the other, shall use its reasonable commercial efforts to obtain, or to cause
to be obtained, any consent, substitution, approval or amendment required to
novate (including with respect to any federal government contract) or assign all
rights and obligations under agreements, leases, licenses and other obligations
or Liabilities (including Palm OFLs) of any nature whatsoever that constitute
Palm Liabilities or to obtain in writing the unconditional release of all
parties to such arrangements other than any member of the Palm Group, so that,
in any such case, Palm and its Subsidiaries will be solely responsible for such
Liabilities; provided, however, that neither 3Com, Palm nor their Subsidiaries
shall be obligated to pay any consideration therefor to any third party from
whom such consents, approvals, substitutions and amendments are requested.

     (b)  Inability to Obtain Novation.  If 3Com or Palm is unable to obtain, or
to cause to be obtained, any such required consent, approval, release,
substitution or amendment, the applicable member of the 3Com Group shall
continue to be bound by such agreements, leases, licenses and other obligations
and, unless not permitted by law or the terms thereof (except to the extent
expressly set forth in this Agreement, the Separation Agreement or any other
Ancillary Agreement), Palm shall, as agent or subcontractor for 3Com or such
other Person, as the case may be, pay, perform and discharge fully, or cause to
be paid, transferred or discharged all the obligations or other Liabilities of
3Com or such other Person, as the case may be, thereunder from and after the
date hereof. 3Com shall, without further consideration, pay and remit, or cause
to be paid or remitted, to Palm or its appropriate Subsidiary promptly all
money, rights and other consideration received by it or any member of its
respective Group in respect of such performance (unless any such consideration
is an Excluded Asset).  If and when any such consent, approval, release,
substitution or amendment shall be obtained or such agreement, lease, license or
other rights or obligations shall otherwise become assignable or able to be
novated, 3Com shall thereafter assign, or cause to be assigned, all its rights,
obligations and other Liabilities thereunder or any rights or obligations of any

                                      -7-

 
member of its respective Group to Palm without payment of further consideration
and Palm shall, without the payment of any further consideration, assume such
rights and obligations.


                                  ARTICLE II 
                                  
                                  LITIGATION

     Section 2.1    Allocation. 

     (a) Litigation to Be Transferred to Palm. Notwithstanding any contrary
provisions in the Indemnification and Insurance Matters Agreement, on the
Separation Date, the responsibilities for management of the litigation
identified in a litigation disclosure letter (the "Litigation Disclosure
Letter"), which will be delivered by 3Com to Palm on the Separation Date, shall
be transferred in their entirety from 3Com and its Subsidiaries to Palm and its
Subsidiaries. As of the Separation Date and thereafter, Palm shall manage the
defense of such litigation and shall cause its applicable Subsidiaries to do the
same. 3Com and its Subsidiaries must first obtain the prior consent of Palm or
its applicable Subsidiary for any action taken subsequent to the Separation Date
in connection with the litigation identified in the Litigation Disclosure
Letter, which consent cannot be unreasonably withheld or delayed. All other
matters relating to such litigation, including but not limited to
indemnification for such claims, shall be governed by the provisions of the
Indemnification and Insurance Matters Agreement.

     (b) Litigation to be Defended by 3Com at Palm's Expense. Notwithstanding
any contrary provisions in the Indemnification and Insurance Matters Agreement,
3Com shall defend, and shall cause its applicable Subsidiaries to defend, the
litigation identified in the Litigation Disclosure Letter that is not delivered
by 3Com to Palm on the Separation Date. All other matters relating to such
litigation, including but not limited to indemnification for such claims, shall
be governed by the provisions of the Indemnification and Insurance Matters
Agreement .

     Section 2.2    Cooperation. 3Com and Palm and their respective Subsidiaries
shall cooperate with each other in the defense of any litigation covered under
this Article II and afford to each other reasonable access upon reasonable
advance notice to witnesses and Information (other than Information protected
from disclosure by applicable privileges) that is reasonably required to defend
this litigation (as "Information" is defined pursuant to Section 5.4 of the
Separation Agreement). The foregoing agreement to cooperate includes, but is not
limited to, an obligation to provide access to qualified assistance to provide
information, witnesses and documents to respond to discovery requests in
specific lawsuits. In such cases, cooperation shall be timely so that the party
responding to discovery may meet all court-imposed deadlines. The party
requesting information shall reimburse the party providing information
consistent with the terms of Section 5.4 of the Separation Agreement. The
obligations set forth in this paragraph are more clearly defined in Section 5.4
of the Separation Agreement.

                                      -8-

 
                                  ARTICLE III

                                 MISCELLANEOUS

     Section 3.1    Entire Agreement. This Agreement, the Separation Agreement,
the other Ancillary Agreements and the Exhibits and Schedules referenced or
attached hereto and thereto, constitutes the entire agreement between the
parties with respect to the subject matter hereof and shall supersede all prior
written and oral and all contemporaneous oral agreements and understandings with
respect to the subject matter hereof.

     Section 3.2    Governing Law. This Agreement shall be construed in
accordance with and all Disputes hereunder shall be governed by the laws of the
State of California, excluding its conflict of law rules and the United Nations
Convention on Contracts for the International Sale of Goods. The Superior Court
of Santa Clara County and/or the United States District Court for the Northern
District of California shall have jurisdiction and venue over all Disputes
between the parties that are permitted to be brought in a court of law pursuant
to Section 5.9 of the Separation Agreement.

     Section 3.3    Notices. Notices, offers, requests or other communications
required or permitted to be given by either party pursuant to the terms of this
Agreement shall be given in writing to the respective parties to the following
addresses:

                if to 3Com:
                              3Com Corporation
                              5400 Bayfront Plaza
                              Santa Clara, California 95052
                              Attention:  General Counsel
                              Fax:  (408) 326-6434


                if to Palm:
                              Palm, Inc.
                              5400 Bayfront Plaza
                              Santa Clara, California 95052
                              Attention:  General Counsel
                              Fax:  (408) 326-6434

or to such other address as the party to whom notice is given may have
previously furnished to the other in writing as provided herein. Any notice
involving non-performance, termination, or renewal shall be sent by hand
delivery, recognized overnight courier or, within the United States, may also be
sent via certified mail, return receipt requested. All other notices may also be
sent by fax, confirmed by first class mail. All notices shall be deemed to have
been given and received on the earlier of actual delivery or three (3) days from
the date of postmark.

     Section 3.4    Parties in Interest. This Agreement, including the Exhibits
and Schedules hereto, and the other documents referred to herein, shall be
binding upon and inure solely to the 

                                      -9-

 
benefit of each party hereto and their legal representatives and successors, and
nothing in this Agreement, express or implied, is intended to confer upon any
other Person any rights or remedies of any nature whatsoever under or by reason
of this Agreement.

     Section 3.5    Counterparts. This Agreement, including the Exhibits and
Schedules hereto, and the other documents referred to herein, may be executed in
counterparts, each of which shall be deemed to be an original but all of which
shall constitute one and the same agreement.

     Section 3.6    Assignment. This Agreement shall inure to the benefit of and
be binding upon the parties hereto and their respective legal representatives
and successors. This Agreement may not be assigned by any party hereto, without
the other party's express written consent.

     Section 3.7    Severability. If any term or other provision of this
Agreement or the Exhibits or Schedules attached hereto is determined by a
nonappealable decision by a court, administrative agency or arbitrator to be
invalid, illegal or incapable of being enforced by any rule of law or public
policy, all other conditions and provisions of this Agreement shall nevertheless
remain in full force and effect so long as the economic or legal substance of
the transactions contemplated hereby is not affected in any manner materially
adverse to any party. Upon such determination that any term or other provision
is invalid, illegal or incapable of being enforced, the parties hereto shall
negotiate in good faith to modify this Agreement so as to effect the original
intent of the parties as closely as possible in an acceptable manner to the end
that transactions contemplated hereby are fulfilled to the fullest extent
possible.

     Section 3.8    Failure or Indulgence Not Waiver; Remedies Cumulative. No
failure or delay on the part of any party hereto in the exercise of any right
hereunder shall impair such right or be construed to be a waiver of, or
acquiescence in, any breach of any representation, warranty or agreement herein,
nor shall any single or partial exercise of any such right preclude other or
further exercise thereof or of any other right. All rights and remedies existing
under this Agreement or the Schedules or Exhibits attached hereto are cumulative
to, and not exclusive of, any rights or remedies otherwise available.

     Section 3.9    Amendment. No change or amendment will be made to this
Agreement except by an instrument in writing signed on behalf of each of the
parties to such agreement.

     Section 3.10   Authority. Each of the parties hereto represents to the
other that (a) it has the corporate or other requisite power and authority to
execute, deliver and perform this Agreement, (b) the execution, delivery and
performance of this Agreement by it have been duly authorized by all necessary
corporate or other action, (c) it has duly and validly executed and delivered
this Agreement, and (d) this Agreement is a legal, valid and binding obligation,
enforceable against it in accordance with its terms subject to applicable
bankruptcy, insolvency, reorganization, moratorium or other similar laws
affecting creditors' rights generally and general equity principles.

     Section 3.11   Interpretation. The headings contained in this Agreement, in
any Exhibit or Schedule hereto and in the table of contents to this Agreement
are for reference purposes only and 

                                      -10-

 
shall not affect in any way the meaning or interpretation of this Agreement. Any
capitalized term used in any Schedule or Exhibit but not otherwise defined
therein, shall have the meaning assigned to such term in this Agreement. When a
reference is made in this Agreement to an Article or a Section, Exhibit or
Schedule, such reference shall be to an Article or Section of, or an Exhibit or
Schedule to, this Agreement unless otherwise indicated.

     Section 3.12   Conflicting Agreements. In the event of conflict between
this Agreement and any other Ancillary Agreement or other agreement executed in
connection herewith, the provisions of such other agreement shall prevail (other
than (i) as otherwise provided herein and (ii) the Separation Agreement).

                                  ARTICLE IV

                                  DEFINITIONS

     Section 4.1    3Com Group. "3Com Group" means 3Com, each Subsidiary and
Affiliated Company of 3Com (other than any member of the Palm Group) immediately
after the Separation Date, after giving effect to the Non-US Plan and each
Person that becomes a Subsidiary or Affiliate Company of 3Com after the
Separation Date.

     Section 4.2    Action. "Action" means any demand, action, suit,
countersuit, arbitration, inquiry, proceeding or investigation by or before any
federal, state, local, foreign or international governmental authority or any
arbitration or mediation tribunal.

     Section 4.3    Affiliated Company. "Affiliated Company" of any Person means
a Person that controls, is controlled by, or is under common control with such
Person. As used herein, "control" means the possession, directly or indirectly,
of the power to direct or cause the direction of the management and policies of
such entity, whether through ownership of voting securities or other interests,
by contract or otherwise.

     Section 4.4    Ancillary Agreement. "Ancillary Agreement" has the meaning
set forth in Section 2.1 of the Separation Agreement.


     Section 4.5    Assets. "Assets" means assets, properties and rights
(including goodwill), wherever located (including in the possession of vendors
or other third parties or elsewhere), whether real, personal or mixed, tangible,
intangible or contingent, in each case whether or not recorded or reflected or
required to be recorded or reflected on the books and records or financial
statements of any Person, including the following:

             (i)    all accounting and other books, records and files whether in
paper, microfilm, microfiche, computer tape or disc, magnetic tape or any other
form;

            (ii)    all apparatus, computers and other electronic data
processing equipment, , automobiles, trucks, aircraft, rolling stock, vessels,
motor vehicles and other transportation 

                                      -11-

 
equipment, special and general tools, test devices, prototypes and models and
other tangible personal property, but excluding fixtures, machinery, equipment,
furniture and office equipment;

           (iii)    all inventories of materials, parts, raw materials,
supplies, work-in-process and finished goods and products;

            (iv)    all interests in real property of whatever nature, including
easements, whether as owner, mortgagee or holder of a Security Interest, lessor,
sublessor, lessee, sublessee or otherwise;

            (vi)    all interests in any capital stock or other equity interests
of any Subsidiary or any other Person; all bonds, notes, debentures or other
securities issued by any Subsidiary or any other Person; all loans, advances or
other extensions of credit or capital contributions to any Subsidiary or any
other Person; and all other investments in securities of any Person;

           (vii)    all license agreements, leases of personal property, open
purchase orders for raw materials, supplies, parts or services, unfilled orders
for the manufacture and sale of products and other contracts, agreements or
commitments;

           (vii)    all deposits, letters of credit and performance and surety
bonds; 

          (viii)    all written technical information, data, specifications,
research and development information, engineering drawings, operating and
maintenance manuals, and materials and analyses prepared by consultants and
other third parties;

            (ix)    all Intellectual Property and licenses from third Persons
granting the right to use any Intellectual Property;

             (x)    all computer applications, programs and other software,
including operating software, network software, firmware, middleware, design
software, design tools, systems documentation and instructions;

            (xi)    all cost information, sales and pricing data, customer
prospect lists, supplier records, customer and supplier lists, customer and
vendor data, correspondence and lists, product literature, artwork, design,
development and manufacturing files, vendor and customer drawings, formulations
and specifications, quality records and reports and other books, records,
studies, surveys, reports, plans and documents;

           (xii)    all prepaid expenses, trade accounts and other accounts and
notes receivables;

          (xiii)    all rights under contracts or agreements, all claims or
rights against any Person arising from the ownership of any Asset, all rights in
connection with any bids or offers and all claims, choses in action or similar
rights, whether accrued or contingent;

                                      -12-

 
           (xiv)    all rights under insurance policies and all rights in the
nature of insurance, indemnification or contribution;

            (xv)    all licenses (including radio and similar licenses),
permits, approvals and authorizations which have been issued by any Governmental
Authority;

           (xvi)    cash or cash equivalents, bank accounts, lock boxes and
other deposit arrangements; and

           (xvi)    interest rate, currency, commodity or other swap, collar,
cap or other hedging or similar agreements or arrangements.

     Section 4.6    Contracts. "Contracts" means any contract, agreement, lease,
license, sales order, purchase order, instrument or other commitment that is
binding on any Person or any part of its property under applicable law.

     Section 4.7    Delayed Transfer Assets. "Delayed Transfer Assets" means any
Palm Assets that are expressly provided in this Agreement, the Separation
Agreement or any other Ancillary Agreement to be transferred after the date of
this Agreement.

     Section 4.8    Distribution. "Distribution" means 3Com's pro rata
distribution to the holders of its common stock, $0.001 par value, following the
IPO as provided in the Separation Agreement, of all of the shares of Palm common
stock owned by 3Com.

     Section 4.9    Distribution Date. "Distribution Date" has the meaning set
forth in Section 4.1 of the Separation Agreement.

     Section 4.10   Governmental Approvals. "Governmental Approvals" means any
notices, reports or other filings to be made, or any consents, registrations,
approvals, permits or authorizations to be obtained from, any Governmental
Authority.

     Section 4.11   Governmental Authority. "Governmental Authority" means any
federal, state, local, foreign or international court, government, department,
commission, board, bureau, agency, official or other regulatory, administrative
or governmental authority.

     Section 4.12   Indemnification and Insurance Matters Agreement.
"Indemnification and Insurance Matters Agreement" means the Indemnification and
Insurance Matters Agreement attached as Exhibit J to the Separation Agreement.

     Section 4.13   Insurance Policies. "Insurance Policies" means insurance
policies pursuant to which a Person makes a true risk transfer to an insurer.

     Section 4.14   Insured Palm Liabilities. "Insured Palm Liabilities" means
any Palm Liability to the extent that (i) it is covered under the terms of
3Com's Insurance Policies in effect 

                                      -13-

 
prior to the Distribution Date and (ii) Palm is not a named insured under, or
otherwise entitled to the benefits of, such Insurance Policies.

     Section 4.15   Intellectual Property. "Intellectual Property" means all
domestic and foreign patents and patent applications, together with any
continuations, continuations-in-part or divisional applications thereof, and all
patents issuing thereon (including reissues, renewals and re-examinations of the
foregoing); design patents, invention disclosures; mask works; copyrights, and
copyright applications and registrations; Web addresses, trademarks, service
marks, trade names, and trade dress, in each case together with any applications
and registrations therefor and all appurtenant goodwill relating thereto; trade
secrets, commercial and technical information, know-how, proprietary or
confidential information, including engineering, production and other designs,
notebooks, processes, drawings, specifications, formulae, and technology;
computer and electronic data processing programs and software (object and source
code), data bases and documentation thereof; inventions (whether patented or
not); utility models; registered designs, certificates of invention and all
other intellectual property under the laws of any country throughout the world.

     Section 4.16   IPO Registration Statement. "IPO Registration Statement"
means the registration statement on Form S-1 pursuant to the Securities Act of
1933, as amended, to be filed with the Securities and Exchange Commission
registering the shares of common stock of Palm to be issued in the initial
public offering, together with all amendments thereto.

     Section 4.17   Liabilities. "Liabilities" means all debts, liabilities,
guarantees, assurances, commitments and obligations, whether fixed, contingent
or absolute, asserted or unasserted, matured or unmatured, liquidated or
unliquidated, accrued or not accrued, known or unknown, due or to become due,
whenever or however arising (including, without limitation, whether arising out
of any Contract or tort based on negligence or strict liability) and whether or
not the same would be required by generally accepted principles and accounting
policies to be reflected in financial statements or disclosed in the notes
thereto.

     Section 4.18   Local Transfer Agreements. "Local Transfer Agreements"
means the agreements necessary to effect the Non-US Plan (as defined in the
Separation Agreement).

     Section 4.19   Non-US Plan. "Non-US Plan" has the meaning set forth in
Section 5.8 of the Separation Agreement.

     Section 4.20   OFLs. "OFLs" mean all liabilities, obligations,
contingencies, instruments and other Liabilities of any member of the 3Com Group
of a financial nature with third parties existing on the date hereof or entered
into or established between the date hereof and the Separation Date, including
any of the following:

            (i)     foreign exchange contracts;

           (ii)     letters of credit;

                                      -14-

 
            (iii)   guarantees of third party loans to customers;
             
             (iv)   surety bonds (excluding surety for workers' compensation
                    self-insurance);
              
              (v)   interest support agreements on third party loans to
                    customers;
             
             (vi)   performance bonds or guarantees issued by third parties;
            
            (vii)   swaps or other derivatives contracts; and
           
           (viii)   recourse arrangements on the sale of receivables or notes.
     
     Section 4.21   Palm Balance Sheet.  "Palm Balance Sheet" means the audited
consolidated balance sheet (including the notes thereto) of the Palm Business as
of August 27, 1999, that is included in the IPO Registration Statement.

     Section 4.22   Palm Business.  "Palm Business" means the business and
operations of the business of Palm as described in the IPO Registration
Statement and, except as otherwise expressly provided herein, any terminated,
divested or discontinued businesses or operations that at the time of
termination, divestiture or discontinuation primarily related to the Palm
Business as then conducted.

     Section 4.23   Palm Contingent Gain. "Palm Contingent Gain" means any claim
or other right of a member of the 3Com Group or the Palm Group that primarily
relates to the Palm Business, whenever arising, against any Person other than a
member of the 3Com Group or the Palm Group, if and to the extent that (i) such
claim or right arises out of the events, acts or omissions occurring as of the
Separation Date (based on then existing law) and (ii) the existence or scope of
the obligation of such other Person as of the Separation Date was not
acknowledged, fixed or determined in any material respect, due to a dispute or
other uncertainty as of the Separation Date or as a result of the failure of
such claim or other right to have been discovered or asserted as of the
Separation Date. A claim or right meeting the foregoing definition shall be
considered a Palm Contingent Gain regardless of whether there was any Action
pending, threatened or contemplated as of the Separation Date with respect
thereto. In the case of any claim or right a portion of which arises out of
events, acts or omissions occurring prior to the Separation Date and a portion
of which arises out of events, acts or omissions occurring on or after the
Separation Date, only that portion that arises out of events, acts or omissions
occurring prior to the Separation Date shall be considered a Palm Contingent
Gain. For purposes of the foregoing, a claim or right shall be deemed to have
accrued as of the Separation Date if all the elements of the claim necessary for
its assertion shall have occurred on or prior to the Separation Date, such that
the claim or right, were it asserted in an Action on or prior to the Separation
Date, would not be dismissed by a court on ripeness or similar grounds.
Notwithstanding the foregoing, none of (i) any Insurance Proceeds, (ii) any
Excluded Assets, (iii) any reversal of any litigation or other reserve, or (iv)
any matters relating to Taxes (which are governed by the Tax Sharing Agreement)
shall be deemed to be a Palm Contingent Gain.

                                      -15-

 
     Section 4.24   Palm Contingent Liability. "Palm Contingent Liability" means
any Liability, other than Liabilities for Taxes (which are governed by the Tax
Sharing Agreement), of a member of the 3Com Group or the Palm Group that
primarily relates to the Palm Business, whenever arising, to any Person other
than a member of the 3Com Group or the Palm Group, if and to the extent that (i)
such Liability arises out of the events, acts or omissions occurring as of the
Separation Date and (ii) the existence or scope of the obligation of a member of
the 3Com Group or the Palm Group as of the Separation Date with respect to such
Liability was not acknowledged, fixed or determined in any material respect, due
to a dispute or other uncertainty as of the Separation Date or as a result of
the failure of such Liability to have been discovered or asserted as of the
Separation Date (it being understood that the existence of a litigation or other
reserve with respect to any Liability shall not be sufficient for such Liability
to be considered acknowledged, fixed or determined). In the case of any
Liability a portion of which arises out of events, acts or omissions occurring
prior to the Separation Date and a portion of which arises out of events, acts
or omissions occurring on or after the Separation Date, only that portion that
arises out of events, acts or omissions occurring prior to the Separation Date
shall be considered a Palm Contingent Liability. For purposes of the foregoing,
a Liability shall be deemed to have arisen out of events, acts or omissions
occurring prior to the Separation Date if all the elements necessary for the
assertion of a claim with respect to such Liability shall have occurred on or
prior to the Separation Date, such that the claim, were it asserted in an Action
on or prior to the Separation Date, would not be dismissed by a court on
ripeness or similar grounds. For purposes of clarification of the foregoing, the
parties agree that no Liability relating to, arising out of or resulting from
any obligation of any Person to perform the executory portion of any contract or
agreement existing as of the Separation Date, or to satisfy any obligation
accrued under any Plan (as defined in the Employee Matters Agreement) as of the
Separation Date, shall deemed to be a Palm Contingent Liability. For purposes of
determining whether a claim relating to the Year 2000 problem is a Palm
Contingent Liability, claims relating to products shipped prior to the
Separation Date shall be deemed to have arisen prior to the Separation Date.

     Section 4.25   Palm Contracts. "Palm Contracts" means the following
contracts and agreements to which 3Com is a party or by which it or any of its
Assets is bound, whether or not in writing, except for any such contract or
agreement that is contemplated to be retained by 3Com or any member of the 3Com
Group pursuant to any provision of this Agreement or any other Ancillary
Agreement:

              (i)   any contract or agreement entered into in the name of, or
expressly on behalf of, any division or business unit of Palm;

             (ii)   any contract or agreement that relates primarily to the Palm
Business;

            (iii)   any contract or agreement that is otherwise expressly
contemplated pursuant to this Agreement, the Separation Agreement or any of the
other Ancillary Agreements to be assigned to Palm;

                                      -16-

 
             (iv)   any guarantee, indemnity, representation, warranty or other
Liability of any member of the Palm Group or the 3Com Group in respect of any
other Palm Contract, any Palm Liability or the Palm Business (including
guarantees of financing incurred by customers or other third parties in
connection with purchases of products or services from the Palm Business); and

              (v)   any Palm OFL.
     
     Section 4.26   Palm Group. "Palm Group" means Palm, each Subsidiary and
Affiliated Company of Palm immediately after the Separation Date or that is
contemplated to be a Subsidiary or Affiliated Company of Palm pursuant to the
Non-US Plan and each Person that becomes a Subsidiary or Affiliate Company of
Palm after the Separation Date.


     Section 4.27   Palm Pro Forma Balance Sheet. "Palm Pro Forma Balance Sheet"
means the unaudited pro forma condensed consolidated balance sheet appearing in
the IPO Registration Statement.

     Section 4.28   Person. "Person" means an individual, a partnership, a
corporation, a limited liability company, an association, a joint stock company,
a trust, a joint venture, an unincorporated organization and a governmental
entity or any department, agency or political subdivision thereof.

     Section 4.29   Retained Payables. "Retained Payables" means (i) all
accounts payable and other obligations of payment for goods or services
purchased, leased or otherwise received in the conduct of the Palm Business that
as of the Separation Date are payable to a third Person by 3Com or any of 3Com's
Subsidiaries, whether past due, due or to become due, including any interest,
sales or use taxes, finance charges, late or returned check charges and other
obligations of 3Com or any of 3Com's Subsidiaries with respect thereto, and any
obligations related to any of the foregoing and (ii) all employee compensation
Liabilities and other miscellaneous Liabilities for which an adjustment is made
in the Palm Pro Forma Balance Sheet.

     Section 4.30   Retained Receivables. "Retained Receivables" means (i) all
accounts receivable and other rights to payment for goods or services sold,
leased or otherwise provided in the conduct of the Palm Business that as of the
Separation Date are payable by a third Person to 3Com or any of 3Com's
Subsidiaries, whether past due, due or to become due, including any interest,
sales or use taxes, finance charges, late or returned check charges and other
obligations of the account debtor with respect thereto, and any proceeds of any
of the foregoing and (ii) all other miscellaneous Assets for which an adjustment
is made in the Palm Pro Forma Balance Sheet.

     Section 4.31   Security Interest. "Security Interest" means any mortgage,
security interest, pledge, lien, charge, claim, option, right to acquire, voting
or other restriction, right-of-way, covenant, condition, easement, encroachment,
restriction on transfer, or other encumbrance of any nature whatsoever.

                                      -17-

 
     Section 4.32   Separation. "Separation" means the transfer and contribution
from 3Com to Palm, and Palm's receipt and assumption of, directly or indirectly,
substantially all of the Assets and Liabilities currently associated with the
Palm Business and the stock, investments or similar interests currently held by
3Com in subsidiaries and other entities that conduct such business.

     Section 4.33   Separation Agreement. "Separation Agreement" means the
Master Separation and Distribution Agreement dated as of December ___, 1999, of
which this is an Exhibit thereto.

     Section 4.34   Separation Date. "Separation Date" means the effective date
and time of each transfer of property, assumption of liability, license,
undertaking, or agreement in connection with the Separation, which shall be
12:01 a.m., Pacific Time, February 26, 2000, or such date as may be fixed by the
Board of Directors of 3Com.

     Section 4.35   Subsidiary. "Subsidiary" of any Person means any corporation
or other organization whether incorporated or unincorporated of which at least a
majority of the securities or interest having by the terms thereof ordinary
voting power to elect at least a majority of the board of directors or others
performing similar functions with respect to such corporation or other
organization is directly or indirectly owned or controlled by such Person or by
any one or more of its Subsidiaries, or by such Person and one or more of its
Subsidiaries; provided, however that no Person that is not directly or
indirectly wholly owned by any other Person shall be a Subsidiary of such other
Person unless such other Person controls, or has the right, power or ability to
control, that Person .

     Section 4.36   Taxes. "Taxes" has the meaning set forth in the Tax Sharing
Agreement.
          
                        [SIGNATURES ON FOLLOWING PAGE]

                                      -18-

 
     IN WITNESS WHEREOF, each of the parties has caused this General Assignment
and Assumption Agreement to be executed on its behalf by its officers thereunto
duly authorized on the day and year first above written.

3COM CORPORATION                        PALM, INC.


By:________________________________     By:_____________________________________

Name:______________________________     Name:___________________________________

Title:_____________________________     Title:__________________________________

                                      -19-

 
                                SCHEDULES

Schedule 1.1(c)          Delayed Transfer Assets and Liabilities
Schedule 1.2(a)(xii)     Specific Palm Assets to be Transferred
Schedule 1.2(b)(i)       Excluded Assets
Schedule 1.3(a)(vi)      Divested Businesses Which Contain Liabilities to be 
                         Transferred to Palm
Schedule 1.3(a)(vii)     Specific Palm Liabilities
Schedule 1.3(b)(i)       Excluded Liabilities

 
            Schedule 1.1(c) Delayed Transfer Assets and Liabilities

                                      -21-

 
          Schedule 1.2(a)(xii) Specific Palm Assets to be Transferred

                                      -22-

 
                      Schedule 1.2(b)(i) Excluded Assets

                                      -23-

 
   Schedule 1.3(a)(vi) Divested Businesses Which Contain Liabilities to be 
                              Transferred to Palm

                                      -24-

 
                Schedule 1.3(a)(vii) Specific Palm Liabilities

                                      -25-

 
                    Schedule 1.3(b)(i) Excluded Liabilities

                                      -26-