We report here further results from the three-dimensional particle-in-cell simulations of the electron-beam driven electron holes. We focus here on (i) the transformation of oscillatory waves driven by the electron-beam instability into electron holes, (ii) the continued evolution and propagation of electron holes after their formation, including merging of electron holes, and (iii) the effects of the evolution on the plasma density and ion velocity distribution function. We find that initially electron-beam modes with perpendicular wave numbers k^ = 0 and as well as k^ 0 are driven resonantly below the electron plasma frequency of the target plasma. The modes interact nonlinearly and modulate each other both in space and time,...