BUSINESS SERVICES AGREEMENT

BETWEEN

PALM, INC.

AND

PALMSOURCE, INC.

Effective as of December 3, 2001

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BUSINESS SERVICES AGREEMENT

This Business Services Agreement (the Agreement) is executed on May 9, 2002 and made effective as of December 3, 2001 (the Effective Date), between Palm Inc., a Delaware corporation (Palm), having an office at 5470 Great America Parkway, Santa Clara, CA 95054 and PalmSource, Inc., a Delaware corporation (PalmSource), having an office at 5470 Great America Parkway, Santa Clara, California, 95054.

RECITALS

WHEREAS, the Board of Directors of Palm has determined that it is in the best interest of Palm and its stockholders to separate Palms existing businesses into two independent businesses and have the current business of the Palm platform solutions group conducted through a wholly-owned subsidiary;

WHEREAS, as part of the foregoing, Palm and PalmSource have entered into a Master Separation Agreement (as defined below), which provides for, among other things, the execution and delivery of certain other agreements in order to facilitate and provide for the foregoing; and

WHEREAS, also as part of the foregoing, the parties further desire to enter into this Agreement for Palm to provide certain business services to PalmSource.

NOW, THEREFORE, in consideration of the mutual promises of the parties, and of good and valuable consideration, it is agreed by and between the parties as follows:

ARTICLE 1

DEFINITIONS

For the purpose of this Agreement, the following capitalized terms are defined in this Article 1 and shall have the meaning specified herein:

1.1 ADDITIONAL SERVICES. Additional Services has the meaning set forth in Section 3.5.

1.2 ANCILLARY AGREEMENTS. Ancillary Agreements has the meaning set forth in the Master Separation Agreement.

1.3 IMPRACTICABLE. Impracticable has the meaning set forth in Section 3.3.

1.4 LOCALIZED VERSION. Localized Version means localized versions of the Software.

1.5 MASTER CONFIDENTIAL DISCLOSURE AGREEMENT. Master Confidential Disclosure Agreement means that certain Master Confidential Disclosure Agreement between Palm and PalmSource.

1.6 MASTER SEPARATION AGREEMENT. Master Separation Agreement means that certain Master Separation Agreement between Palm and PalmSource.

1.7 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.

1.8 SEPARATION DATE. Separation Date means 12:01 a.m., Pacific Time, December 3, 2001, or such other date as may be fixed by the Board of Directors of Palm.

1.9 SERVICE(S). Service(s) has the meaning set forth in Section 3.1.

1.10 SERVICE LEVEL AGREEMENT. Service Level Agreement has the meaning set forth in Article 2.

1.11 SOFTWARE. Software means Palms software program(s), in object code only, listed and described in the relevant Service Level Agreement.

1.12 SUBSIDIARY. Subsidiary of any Person means a corporation or other organization whether incorporated or unincorporated of which at least a majority of the securities or interests 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. For purposes of this Agreement, PalmSource shall be deemed not to be a subsidiary of Palm.

ARTICLE 2

SERVICE LEVEL AGREEMENTS

This Agreement will govern individual business services as requested by PalmSource and provided by Palm, the details of which are set forth in the Service Level Agreements attached to this Agreement. Each Service shall be covered by this Agreement upon execution of a service level agreement in the form attached hereto (each service level agreement, a Service Level Agreement). For each Service, the parties shall set forth, among other things, the time period during which the Service will be provided if different from the term of this Agreement determined pursuant to Article 4 hereof, a summary of the Service to be provided; a description of the Service; and the estimated charge, if any, for the Service and any other terms applicable thereto on the Service Level Agreement. Obligations regarding each Service Level

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