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Company Awaits Stockholder Approval of Special Meeting Resolutions MENLO PARK, Calif. -- October 25, 2001 -- Be Incorporated (Nasdaq:BEOS) today reported financial results for the quarter ended September 30, 2001. Net revenues for the third quarter of 2001 were $1,135,000. Revenues for the quarter were primarily attributable to fees received from Palm, Inc. for revenue-related consulting services performed under a funding agreement that was entered into August 16, 2001, contemporaneously with the execution and delivery of the asset purchase agreement among Be, Palm and ECA Subsidiary Acquisition Corporation. The Company reported a net loss for the quarter of $0.09 per share excluding non-cash expenses associated with the amortization of deferred compensation. The Company had previously reported a comparable net loss of $0.10 per share for the second quarter and a net loss of $0.12 per share for the third quarter of last year. Including non-cash expenses associated with the amortization of deferred compensation, net loss per share for the third quarter this year was $0.07 per share. On October 9, 2001, the Company announced that a Special Meeting of its stockholders would be held on November 12, 2001. Be's stockholders are being asked to vote on (1) the proposed sale of substantially all of Be's intellectual property and other technology assets to ECA Subsidiary Acquisition Corporation, a wholly owned subsidiary of Palm, Inc., and (2) the subsequent plan of dissolution for Be. Be's management and board of directors urge Be's stockholders to vote FOR each of the proposals as soon as possible. Both proposals need to be approved by a majority of the outstanding shares of common stock. Stockholders who fail to return their proxy cards or fail to vote via phone or the internet will have the same effect as voting AGAINST the asset sale and the dissolution. If either the asset sale or the dissolution is not approved, it is likely that Be will file for, or will be forced to resort to, bankruptcy protection. The prospectus/proxy statement was mailed on or about October 10, 2001 to Be stockholders of record on October 4, 2001. If you encounter any problems or need assistance with voting your shares, please call our proxy solicitor, Kevin Schwicardi with N.S. Taylor & Associates, Inc., toll free 1.866.470.4300 or collect 1.207.564.8700. About Be Founded in 1990, Be Inc. creates software solutions that enable rich media and Web experiences on personal computers and Internet appliances. Be's headquarters are in Menlo Park, California. It is publicly traded on the Nasdaq National Market under the symbol BEOS. Be can be found on the Web at http://www.be.com/. Forward Looking Statements Statements contained in this Press Release that are not historical facts are ''forward-looking statements'' including without limitation statements regarding the future operating results of Be Incorporated. Actual events or results may differ materially as a result of risks facing Be Incorporated or actual results differing from the assumptions underlying such statements. All forward-looking statements are expressly qualified in their entirety by the ''Risk Factors'' and other cautionary statements included in Be Incorporated's Annual Report on Form 10-K for the year ended December 31, 2000, and other public filings with the Securities and Exchange Commission. --- Stockholders of Be Incorporated are urged to read the prospectus/proxy statement when they receive it and any other relevant documents filed with the Securities and Exchange Commission (''SEC'') by Be Incorporated and Palm, Inc. because they contain important information. You may obtain the documents free of charge at the SEC's web site, http://www.sec.gov/. In addition, documents filed by Be Incorporated with the SEC can be obtained by contacting Be Incorporated at the following address and telephone California 94025, telephone: 1.650.462.4100. Please read the prospectus/proxy statement carefully before making a decision concerning the dissolution of Be and the sale of Be assets to ECA Subsidiary Acquisition Company, a wholly owned subsidiary of Palm, Inc. Be, its officers, directors, employees and agents will be soliciting proxies from Be stockholders in connection with the asset sale. Information concerning the participants in the solicitation is set forth in the prospectus/proxy statement. BE INCORPORATED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except per share amounts) Three Months Ended Nine Months Ended September 30, September 30, 2001 2000 2001 2000 Net revenues $ 1,135 $ 68 $ 1,950 $ 464 Cost of revenues 1,765 216 2,336 770 ------- ------- ------- ------- Gross profit (loss) (630) (148) (386) (306) Operating expenses: Research and development 1,398 2,088 6,053 6,079 Sales and marketing 110 1,422 2,221 5,576 General and administrative 1,121 880 3,501 2,669 Restructuring charge - - 450 - Amortization of deferred stock compensation (516) 507 (185) 2,197 ------ ------ ------- ------- Total operating expenses 2,113 4,897 12,040 16,521 ------- ------ ------- ------- Loss from operations (2,743) (5,045) (12,426) (16,827) Other income, net 19 274 249 937 ------- ------ ------- ------- Net Loss $(2,724) $(4,771) $(12,177) $(15,890) ======== ======= ========= ========= Basic and diluted net loss per share $ (0.07) (0.13) $ (0.33) $ (0.45) ======== ======= ======= ======= Shares used to compute basic and diluted net loss per share 36,630 35,722 36,430 35,406 ======== ======= ======= ======= Net loss per share excluding restructuring charge and amortization of deferred compensation $ (0.09) $ (0.12) $ (0.33) $ (0.39) ======== ======== ======== ======== BE INCORPORATED CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands) September 30, December 31, ASSETS 2001 2000 Current assets: Cash, cash equivalents and short term investments $ 2,098 $ 14,057 Accounts receivable, net 74 26 Prepaid expenses and other 577 549 -------- -------- Total current assets 2,749 14,632 Property and equipment, net 248 391 Other assets 24 1,048 -------- -------- Total Assets $ 3,021 $ 16,071 ======== ======== LIABILITIES AND STOCKHOLDERS' EQUITY Current Liabilities: Accounts payable $ 111 $ 362 Accrued expenses 621 1,502 Technology license obligations 432 454 Deferred revenue 64 109 -------- -------- Total current liabilities 1,228 2,427 Technology license obligations 244 320 Total stockholders' equity 1,549 13,324 -------- -------- Total Liabilities and Stockholders' Equity $ 3,021 $ 16,071 ======== ========

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