Palm Grants Employees Shares of PalmSource

Palm Inc., the world’s largest maker of hand-held computers, said eight key employees had been awarded 8% of the software operating unit that Palm plans to spin off this month.

The 932,965 shares of restricted common stock of PalmSource are worth about $14 million, Milpitas, Calif.-based Palm said in a quarterly filing with the Securities and Exchange Commission.

Palm shareholders will vote Oct. 28 on whether to spin off PalmSource, which will sell operating systems for hand-held computers. If shareholders approve, Palm would change its name to PalmOne Inc. and purchase Handspring Inc., a maker of combination cell phones and hand-held organizers.