Speedier networks sooner not later

3Com Corporation and Broadcom have formed an alliance to accelerate the deployment of Gigabit Ethernet into business networks. 3Com and Broadcom intend to jointly develop new products, cross-license technologies, engage in joint sales and marketing activities and enter into a supply chain agreement.

The alliance represents an expansion of an already existing relationship between Broadcom and 3Com. The companies have previously collaborated on several joint development projects including custom devices for 10/100 BASE-T NIC (network interface card) and LOM (LAN on motherboard) solutions, cable modems and home networking products.

3Com is already a shareholder in Broadcom as a result of investments in companies subsequently acquired by Broadcom. As part of the alliance, 3Com has issued to Broadcom a warrant to acquire up to 7.1 million shares of 3Com common stock, representing about 2% of 3Com’s current outstanding shares through December 2002.

The per share exercise price and purchase price of the warrant will be determined pursuant to a formula, based upon the average closing price of 3Com common stock on the Nasdaq National Market during the month of December 2000.

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