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http://www.corporate-ir.net/ireye/ir_site.zhtml?ticker=BTOB&script=340&layout=6&item_id=BTOB 33 Leasing Companies Major Changes American
Business Leasing ( gone ) any comments, corrections, additions, or suggestions are greatly appreciated. I am proud to announce we have added a new feature to www.leasingnews.org http://www.leasingnews.org/articles.htm The first was sent by Bruce Kropschot, maybe a month or two ago, and was too long to send in text. While dated, the thought behind it is more accurate than when he first wrote it. Kropschot is one smart fellow. Mike Graneri then gave us permission to publish his Leasing Close Newsletter, and being on our advisory board, suggested we have a section devoted for brokers ( and lessors ). His articles are great for new salespeople and also older pro's. You can never forget the basics. We are very proud to feature:"Lease Closer Newsletter." http://www.leasingnews.org/articles.htm Kit Menkin--editor UniCapital Sells 18 Aircraft to Lehman Bros MIAMI--(BUSINESS WIRE)--July 27, 2000--UniCapital Corporation (NYSE:UCP) today announced it has sold 18 aircraft to an affiliate of Lehman Brothers in an effort to accelerate the company's planned exit from the Big Ticket Division. The sale provides UniCapital with more than $20 million in cash and extinguishes the company's related debt on the aircraft that were sold. Further details of the transaction were not disclosed. "We're pleased to have worked with Lehman Brothers to finalize this transaction," said Tal Briddell, UniCapital's newly appointed CEO. "As previously announced, we are moving forward with our strategy to divest our company of its activities in the leasing and trading of commercial aircraft." UniCapital Corporation provides asset-based financing in strategically diverse sectors of the commercial equipment leasing industry. Headquartered in Miami, UniCapital originates, acquires, sells and services equipment leases and arranges structured financing in the middle market, small ticket and computer and telecommunications segments of the commercial equipment leasing industry. For more information, visit UniCapital's Web site at www.unicapitalcorp.com. Certain statements contained in this press release may be deemed to be forward-looking statements that involve risks and uncertainties. These statements are made under the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995, and should be read in conjunction with the risk factors set forth in the Company's Annual Report on Form 10-K for the year ended December 31, 1999, as filed with the Securities and Exchange Commission. Those risk factors include, among others, limitations imposed by the Company's credit facilities, risks related to the need for additional capital, risks related to the Company's acquisition strategy, risks arising from the absence of combined operating history for the Company and its subsidiaries, risks related to internal growth and operating strategies, interest rate risks, risks related to fluctuations in quarterly operating results, risks related to consummating securitization transactions and other risks. These risks and other factors could cause actual results to differ materially from those expressed or implied in any forward-looking statements contained in this press release. In addition, results may vary as a result of factors set forth from time to time in the documents filed by the Company with the Securities and Exchange Commission. The Company assumes no obligation to update any forward-looking statements to reflect actual results or changes in the factors affecting such forward-looking statements. --30--nmb/mi* CONTACT: Investors Contact: UniCapital Corporation, Miami Jody Campbell, 305/899-5000 jcampbell@unicapitalcorp.com Finova Announces Earnings for QII The Finova Group announced net income of $42.9 million ($0.69 per diluted share) for the quarter ended June 30, 2000, compared to $53.7 million ($0.83 per diluted share) for the second quarter in 1999. The reduction in earnings was due primarily to higher loss provisions related to increased write-offs and to a lower interest margin percentage earned on its portfolio. Finova experienced increased cost of funds following a reduction in credit ratings subsequent to special charges taken in the first quarter, higher costs associated with borrowing under its domestic commercial paper back-up bank facilities and an increase in non-earning accounts during the second quarter of 2000. In addition, earnings were reduced by the costs associated with Finova's exit from the Commercial Mortgage Backed Securities (CMBS) market. Net income for the six months ended June 30, 2000 was $53.3 million ($0.86 per diluted share) compared to $103.7 million ($1.66 per diluted share) for the first six months of 1999. Matt Breyne, president and chief executive officer of FINOVA, said, "We continue to fund new business and meet our current obligations through cash flow, available credit lines and asset sales. The demand for Finova's products remains strong and our people continue to service our customers and have been supportive while the company explores its strategic alternatives." Earlier this year, Finova announced that it had retained Credit Suisse First Boston to assist the company with a comprehensive evaluation of its strategic alternatives. "The evaluation is continuing, with various forms of transactions under review, including a sale of the company," Breyne added. Interest margins earned in dollars increased slightly in the second quarter of 2000 when compared to the second quarter of 1999 ($144.1 million vs. $140.0 million). The increase in interest margins was only 3%, notwithstanding portfolio growth of 17.1%, due primarily to the higher cost of funds. As a result, interest margins earned annualized as a percent of average earning assets, declined to 4.6% for the second quarter of 2000 from 5.3% in the second quarter of 1999 and 5.2% for the first quarter of 2000. The events of the second quarter increased Finova's cost of funds applicable to approximately $4.5 billion of loans by 0.30% during the second quarter of 2000. Had the borrowings from those back-up facilities been outstanding for the entire second quarter, the cost of funds effect would have been 0.70%. The
growth in managed assets year over year was $2.0 billion (17.1%) and was primarily
driven by new business of $4.7 billion added during the last 12 months. On May 31, 2000, Finova announced the completion of a loan and lease securitization with assets originated by its Commercial Equipment Finance division, resulting in initial proceeds of $302 million. Deutsche Bank Alex Brown acted as structuring agent for this transaction, which includes a 364-day commitment to purchase up to $375 million of equipment loans and leases on a revolving basis. During July, Finova completed two additional securitizations with total commitments of $800 million. One securitization, with Chase Securities acting as structuring agent, has been funded, resulting in initial proceeds of $375 million. The structure includes a commitment to purchase up to $500 million of loans on a revolving basis, subject to certain conditions, and has been funded through a commercial paper conduit. The assets were originated by Finova's Corporate Finance division. An additional $300 million securitization, structured by Morgan Stanley Dean Witter, is available for future funding. Assets for this securitization will originate through Finova's Franchise Finance division. Volume-based fees were slightly higher in the second quarter of 2000 at $11.7 million vs. $11.3 million in the 1999 quarter, due to higher rates earned on that volume in 2000 (0.93% vs. 0.73%). Fee-based volume for the second quarter of 2000 was $1.262 billion, $281.7 million lower than the $1.544 billion recorded in the second quarter of 1999. Loss provisions in the second quarter of 2000 were $39.8 million compared to $17.0 million in the second quarter of 1999. The increased loss provisions were primarily due to higher write-offs of $38.5 million in the second quarter of 2000 compared to $16.2 million in the 1999 second quarter. The bulk of the write-offs were in two businesses, Mezzanine Finance ($15.3 million) and Corporate Finance ($14.2 million). Nonaccruing assets increased during the second quarter to $421.5 million from $318.0 million at March 31, 2000. The largest increases in nonaccruing assets during the second quarter of 2000 occurred in Corporate Finance ($50.6 million with $48.1 million representing loans to two separate, but related companies) and Transportation Finance ($38.6 million representing one account). Earning impaired assets also increased during the quarter to $251.4 million from $161.8 million at March 31, 2000, primarily due to the addition of a $95.4 million loan to a Resort Finance customer. That customer is a large timeshare developer that has filed for bankruptcy protection under Chapter 11. Finova believes that the value of collateral in which it has a security interest will enable it to recover its investment in the transaction. The reserve for credit losses at June 30 was approximately 2% of managed assets, but as a percent of nonaccruing assets declined to 64.2% from 84.7% at March 31, 2000 due to the increase in nonaccruing assets.
Breyne said, "On a regular basis, the Company monitors developments affecting
loans and leases in our portfolio, taking into account each borrower's financial
developments and prospects, the value of collateral, legal developments and other
available information. Based upon those developments, the Company adjusts its
loan loss reserve and when considered appropriate, writes down the value of loans.
Depending on developments, there is the possibility that loan loss reserves and/or
writedowns will increase in the future." Gains on disposal of assets were $12.7 million pre-tax during the second quarter of 2000, down from $18.8 million pre-tax in the second quarter of 1999. Gains during the second quarter of 2000 consisted of $4.1 million from lease residual sales and $8.6 million from the sale of investments and loans. Included in the latter amount was a gain from the sale of Finova's Harris Williams division to its management. Operating expenses were lower during the second quarter of 2000 when compared to the 1999 quarter, ($60.7 million vs. $63.3 million), in spite of adding personnel in connection with the Fremont Financial acquisition completed in December 1999. The higher personnel costs were more than offset by the reversal of management and sales incentive accruals in the second quarter of 2000. The efficiency ratio (operating expenses as a percent of operating margins and gains), was 36.0%, compared to 37.3% in the second quarter of 1999. As announced in the Company's first quarter earnings release, a decision was made in April 2000 to exit the origination and sale of commercial real estate loans to the CMBS market. The cost to exit this product, which consisted of termination and severance charges, as well as the closing of numerous offices, was $11.8 million pre-tax. July 27, 2000 Bulletin Board any comments, corrections, additions, or suggestions are greatly appreciated. BULLETIN BOARD ( These are postings for informational purposes. Any response, correction, addition, will be posted. We reserve the right to edit or delete any opinion that is not in goodtaste or is outright derogatory ).
Leasing Network Purchase Option Problems 7/26 Leasing Network Purchase Option Problems
Notice: Received reports from three brokers now about leases they put together
through network group to funding source has fmv not 10% purchase options. Disputes
trying to be resolved. Any broker experiencing the same, please notify Leasingnews.org.
All information will be kept confidential and will not be published without your
specific permission.
Kit, my company, Citation Financial Group located in Fair Oaks, CA (Sacramento)
is one of the companies having a problem with Universal Capital Services. They
have not returned a Lessee's advance payment nor have they paid us our commisssion
on a brokered transaction. I have sent documents to the NALEB attorney, who is
following up on our complaint with UCS. We have also contacted a collection attorney
in Florida. If you know of others who have been wronged by these people, please
have them contact me. If you want all of the details I will be happy to e-mail
them to you. We need to stop companies who make a bad name for the industry. Bruce Zwillinger, BSB, cuts off Universal Capital Service Bruce
Zwillinger, BSB, cuts off Universal Capital Service, Springhill, Florida informs
NAELB of their action. This company not returning money to lessee from deal funding
by BSB. Many attempts to get money returned to lessee, but many broker promises
by Universal Capital Service. Universal Capital Services
Source states Universal Capital Services, Springhill, Florida, took up-front fees
on deal and has not returned to lessee. Lessee is complaining to funding source.
This is the third complaint received on this. Source is trying to find out more
and request this be posted on bulletin board. Source will allow us to state name,
if this is not resolved. Parker Leasing $25,000
SD $29,000 first and last three months did not return money Parker Leasing and
Financing, Ft. Lauderdale, Florida no web site, no district attorney complaints,
advised to pull a D&B, find out who the secured parties are and if I can identify
them, will give them the person to call at the funding source to hear the full
story about what is happening. Parker Leasing and Financing refuses to return
commitment fee and first and last. Dodson Group - Delivery Charge We
had been using the Dodson Group for overnight (Airborne) until recently. They
were charging us $8.75 per overnight (their cost to Airborne is $7.61, who cares,
they deserve a profit). But, in auditing our bills for the last 2 years we kept
noticing that we were being repeatedly charged $12.00 to $18.75 for overnight
on about 1/3 to 1/2 of the over nights. Initially, Dodson claimed "overweight",
so we researched further and discovered that most of the overcharges were on checks
going out overnight to vendors and brokers - no way this could be "overweight".
For the past year we have faxed and called Dodson repeatedly to get corrected
invoices - no one would even respond! So, we put them on notice that we would
not pay any more invoices until they corrected their over billing problem - they
never did. Their response was to turn us over to a collection agency! We are convinced
they purposely overcharged us, and probably every other client! Dodson does a
lot of biz with NAELB brokers, don't these brokers need to know about Dodson's
policy of quoting one price and charging another? Universal Finance / Universal Manufacturing Avoid
this company like the plague. I believe that if it is the same one they also run
companies under the name(s) Universal Manufacturing -(Vendor) & Universal Finance
(Credit repair company). I'll look up the e-mail I received on this a while back.
I think what the story was is that Universal Capital would submit a deal to funding
source, then if declined due to personal credit, Universal Finance would repair
credit then resubmit elsewhere. The vendor would be Universal Manufacturing who
would sell $2,000 computers for $40,000 invoice (just under F/S disclosure). Then
they split excess with lessee. Though I'm not sure about the Florida part. I'll
get back with the additional info ASAP. Universal Capital
Do you know anything about Univerasl Capital Services, Inc., in Spring Hill, Florida
34606. One of the lease brokers I work with is having trouble getting paid on
a deal. He thinks the company is owned by Jim and Anita Koper. Please let me know
if you hear anything. Thanks. Metropolitan Mortgage Metropolitan
Mortgage and Sec in Washington had a division that funded the lesser credits.
Well they have stopped and are not honoring their approvals if they don't already
have signed docs. This was told to me by a broker in Arizona who has 10 deals
sitting with them and she is now scrambling to replace them.
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