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January 31, 2001 Headlines---- Fed Cuts Rates by a Half-Point Hints at More to Come By Knut Engelmann Reuters WASHINGTON (Jan. 31) - The Federal Reserve on Wednesday slashed key U.S. interest rates by half a percentage point, saying the nation's economic slowdown required a "rapid and forceful response" and signaling it would do more if needed. The action, which was widely expected by financial markets and follows a surprise half-percentage point rate cut earlier this month, takes the bellwether fed funds overnight bank lending rate to 5.5 percent from 6 percent, and erases all the rate increases of 2000, when the economy was still booming. To underline its determination to keep the record U.S. expansion on track, the powerful central bank also cut the discount rate on direct Fed loans to commercial banks by a half-point to 5.0 percent. In a statement released after a two-day session of the rate-setting Federal Open Market Committee, the Fed said it still views excessive weakness as the main risk to the U.S. economy, suggesting it remains open to further rate cuts should the economy continue to deteriorate. The FOMC next meets on March 20. Stock prices pared their gains after the move while bond prices stayed at higher levels as financial markets appeared relieved that the Fed delivered what they had hoped for. The dollar inched lower against other key currencies. Justifying its decision, the Fed said: "Consumer and business confidence has eroded further, exacerbated by rising energy costs that continue to drain consumer purchasing power and press on business profit margins." The statement also cited the resulting drag on retail sales and business spending on capital equipment, a key driver of recent productivity gains. "In response, manufacturing production has been cut back sharply, with new technologies appearing to have accelerated the response of production and demand to potential excesses in the stock of inventories and capital equipment," the Fed said. "Taken together, and with inflation contained, these circumstances have called for a rapid and forceful response of monetary policy," it added in unusually strong language. TEN YEARS AND COUNTING The Fed's easing campaign this month was its most aggressive in almost a decade. The central bank has not cut short-term borrowing costs by a full percentage point in one calendar month since a matching full point discount rate cut in December 1991, just as the country emerged from a recession. The Fed's latest rate cut comes amid a slew of data -- including anemic fourth-quarter economic growth numbers released earlier on Wednesday -- depicting a sharp slowdown in the mighty U.S. economy, in the 10th year of its record expansion. "By cutting interest rates for the second time in a month, the Fed is trying to do anything it can to keep economy from weakening further. They are concerned about declining consumer and business confidence," said Gary Thayer, chief economist at AG Edwards & Sons in St. Louis. On Wednesday, the government said the pace of growth fell sharply in the closing quarter of 2000, achieving the weakest gain in 5-1/2 years. That came on the heels of a report on Tuesday showing that consumer confidence sank to its lowest level in more than four years, threatening future growth because consumer spending accounts for some two-thirds of overall economic activity and worried shoppers spend less. Fed Chairman Alan Greenspan last week told U.S. lawmakers in testimony that growth was "probably very close to zero" right now and the critical issue was whether weakening sales and production were enough "to breach the fabric of consumer confidence," all but setting up financial markets for Wednesday's rate cut and possibly more in the near future. Leading U.S. banks immediately followed the Fed's lead and started cutting their prime rates -- which determine the cost of credit to the bulk of their customers -- within minutes of the Fed's rate announcement. RUNNING SCARED The U.S. economy lost steam abruptly in the second half of 2000, after a robust first six months that helped give the country its strongest full-year growth in 16 years. Total output for all of 2000 increased by 5 percent, the biggest annual rise since 7.3 percent in 1984. But the full-year performance was overshadowed by the steady loss of economic stamina as 2000 drew to a close. Gross domestic product, which measures the value of all goods and services produced within U.S. borders, fell to a meager 1.4 percent annual rate during the October-December fourth quarter, down from 2.2 percent in the third quarter. "I think the Fed is clearly running a bit scared and they are trying to help out the stock market in the short run to boost consumer confidence and spending," said Sung Won Sohn, chief economist at Wells Fargo Bank in Minneapolis. The Fed said the decision to cut the discount rate, which has taken on increasingly symbolic value over recent years, was taken unanimously by its five-member executive board of governors. The board votes on changes in the discount rate on the request of regional Fed banks, while the fed funds rate is set by the FOMC, which groups Washington-based Fed governors and presidents of the regional Feds who vote on a rotating basis. The Bush administration declined to comment on the Fed's rate decision. Treasury Secretary Paul O'Neill said in a brief statement the administration "respects the independence" of the central bank. Dell,Staples Leasing Pioneer Gets First $10 million for Web-Based Financial Sales & Transaction Processing Organization Web-based business-to-business transactions, which some analysts predict will reach $1.3 trillion by 2003, are forcing equipment vendors to provide automated financing solutions for transaction fulfillment. As a result, lease/finance companies and new economy credit companies have developed tools to expedite the credit scoring process. Leasing Group offers a vendor-centric technology that automates all financial offerings from multiple financing sources into its customers central order management system. Leasing Group has funded over $1 billion in lease/finance transactions since its inception in 1988, they claim. "Leasing Group is unique among the companies competing in the lease/financing sector because its platform is focused on the equipment vendor, not the end-user," said Greg Batton, partner, Conning Capital Partners. "Its platform allows vendors to own the financing relationship with their customers. This is a huge advantage for vendors because it ensures them a relationship with their customers even after the sale, allowing them to keep track of their customer's capital needs." Conning Capital Partners states this is a "first round" $10 million investment in Leasing Group, a 12-year-old Austin, Texas-based company. Leasing Group's Web Finance Portal delivers transaction fulfillment services to its customers at their locations or on the web. The capital will be used to expand the company's customer base and to add new financial products to its array of services. Other investors in this round include Stephens Group. Leasing Group operates as a vendor's financial products provider to determine the best financing alternatives available to the vendor's customers. Its Web Finance Portal enables its customers to originate, track, close and report transactions using multiple financing solutions that are transparent to the vendor's customer. The portal automates the credit evaluation, decision response, and documentation online. This streamlined process can help create increased sales and profitability for vendors by generating a higher number of closed transactions. The company provides web-based leasing and financing solutions to business equipment vendors, funding sources, captive organizations and banks. Born from our 10 year relationship with Dell Computer Corp,"... we have developed a state-of-the-art, web-based process that enables us to track lease/finance transactions by up to 20 different status codes. These codes follow a transaction from its origination to final execution and payment to the vendor. "Based on our knowledge of the customer's business, the customer's credit status and particular leasing qualifications, we use our best judgment as to which of our multiple underwriters offers the best financial solution. We have the most efficient process in the industry through our Web Finance Portal™." The Company was initially formed by Clark Covert to provide leasing services to Dell Computer Corporation. To expand Dell's leasing program to all customers who acquire Dell equipment, Dell requested the Company to provide its services to both CompUSA and Staples.Due to a restrictive, non-compete agreement with Dell Computer, the Company maintained only three computer equipment vendors for its first nine years of operation. . In January 1997, the Company began the process of "transitioning" its Dell account to a newly formed entity, known as Dell Financial Services, L.P. With the completion of this transition in July 1997, Leasing Group was permitted to pursue relationships to provide leasing services to other computer vendors and manufacturers. The Company quickly began building a business development team and a program launch team and was successful in establishing leasing programs for Power Computing, Inc., Packard Bell NEC, Inc., and Gateway. These new accounts were managed off-site, with the processing capability centrally located in Austin. Leasing Group has continued its business development successes by becoming the exclusive leasing provider to Micron, Micro Warehouse, and PC Connection for major accounts, commercial accounts, and government/education leases. In 1999, the Company formed its ClientAlliance™ Division ("CAD") which focuses principally on small local and regional re sellers. Clark Covert, Founder, Director, President, Chief Executive Officer - Mr. Covert founded Leasing Group in 1988. He has prior experience as a principal in an automotive dealership and C&G Leasing, Inc. He is the co-founder of the Texas Association of Equipment Lessors and an active member of the Equipment Leasing Association steering committees. He received his BBA from the University of Texas. Mark Perkins, Vice President, Operations and Information Technology - Mr. Perkins joined Leasing Group in 1997.From 1988 through 1996, Mr. Perkins was with Dell Computer Corporation, most recently managing Dell's Major Accounts Financial Services Organization, which included the credit, collections, and order placement functions in support of Dell's Fortune 500 . Pete Connor, Vice President, Sales - Mr. Connor joined Leasing Group in 1977. Prior he was Director of Sales, Southeast Region with Tokai Financial Services, now known as De Lage Landen Financial Services. He received his BBA with a major in Finance from Stephen F. Austin State University. Darcy Shorman, Vice President, Business Development - Mr. Shorman joined Leasing Group in 1997. Among his background is being national accounts manager for Dell Computer.Mr. Shorman graduated from Oral Roberts University with a BBS degree in Business Management. Bud Welborn, Vice President, Financial Products - Mr. Welborn joined Leasing Group in 1993 as its Manager of Operations, responsible for all documentation and funding procedures. His background includes Business Unit Manger for Dell and CompUSA, Launch Director for NEC and Micron Programs, and Project Manager for Information Systems and Marketing. He received a BBA with a concentration in Finance from Southwestern University and an MBA with a concentration in International Finance from Texas A&M University. Rusty Stein, Vice President, Vendor Development - Mr. Stein joined Leasing Group in 1994. He is originally from Austin, Texas and has broad based experience in both retail and direct channels through various sales and management positions held during his Leasing Group tenure. Among these positions are Sales Representative, Strategic Sales Representative, Account Executive, and Director Micron Leasing Program in which Mr. Stein was responsible for the implementation and management of an on-site sales processing, and marketing team. This team was also the first to implement the Web Finance Portal™ on-site with a vendor. He received his BBA in History and English from Virginia Military Institute. United Association of Equipment Leasing January Symposium---official report ( we issued reports from readers on Monday, January 29th and this was received afterwards. we did not issue yesterday due to lack of news. editor ) January 26, 2001 UAEL Costa Mesa Funding Retreat With over 100 equipment leasing professionals in attendance, this years Costa Mesa Funding Retreat was filled with involvement, networking and education! The day began with a standing room only Town Hall Meeting where UAEL President Chuck Brazier, CLP accompanied by UAEL Vice President Bob Fisher, CLP; UAEL Secretary/Treasurer Bette Kerhoulas, CLP and UAEL Director of Membership and Marketing Bill Grohe discussed the structure and goals of UAEL for 2001. Also in attendance were UAEL Board Members Terey Jennings, CLP and Steve Jenkins; Regional Chairs Bill Hanson, Tom Mulally and Raphael Lavin, CLP along with Spring Education Conference Committee Member Dwight Galloway, CLP. Brokers and Lessors had the opportunity to meet one-on-one with funding sources, learn about the new FTC Ruling and UCC Article 9 as well as meet old friends and new during the networking luncheon and throughout the day. Over twenty members have their hands raised to volunteer on various UAEL committees during 2001. This involvement shows the commitment to UAEL and that it is a member driven association. Thank you to everyone who attended and volunteered during Friday's event. Joanie Dalton - Managing Director UAEL - United Association of Equipment Leasing 520 Third Street, #201 Oakland, CA 94607 (510) 444-9235 x27 (510) 444-1346 fax joanie@uael.org www.uael.org + + + Attendee Raphael Lavin Report Having just returned from the UAEL Costa Mesa Funding retreat, I am pleased to report that UAEL is alive and well and back on track. Close to 100 leasing professionals were in attendance at this leasing conference that attracted 19 funders and 80 plus broker/lessors. The funding symposium and educational programs(Article 9 and Credit Scoring) were both well organized and well attended. In an environment of such radical change, it is incumbent upon all professionals involved in leasing to belong to an association and to attend functions. I suggest that all readers make sure that they check out the closest association meeting and get involved now. Leasing is a "people business" and to deny that will only hasten one's extinction. Raphael Lavin, CLP SProfessio@aol.com Standard Professional Services, LLC Thank you for your very valuable contribution to the leasing industry. We at "Priority Leasing Services" have come to depend on your publication to keep us informed of the changes and happenings within the leasing community. We would like to continue to receive Leasing News. Jerome Weinberg www.priorityleases.com leases@bellsouth.net Textron Financial Corporation Announces Formation of Technology Finance Division PROVIDENCE, R.I.--(BUSINESS WIRE)---Textron Financial Corporation announced today that it has established a new lending group, Technology Finance Division, as a result of its purchase of certain assets of the Distribution & Channel Finance Division of FINOVA Capital Corporation in December 2000. The Technology Finance Division offers various forms of financing to the telecommunications industry, including leasing, short-term and working capital financing, term loans, and private label financing. John C. Reed will lead the Technology Finance Division as senior vice president and division manager. Reed joins Textron Financial along with a small group of employees from Finova Capital as part of this portfolio acquisition. "We are excited to have John and his outstanding team join our company, and look forward to building new relationships with the telecommunications customers in this portfolio," stated Jerry Britton, group president at Textron Financial. "Our goal is to use our unique finance platform, augmented by a state-of the-art Internet product, to become the premier lending source for telecommunications equipment manufacturers, distributors and end-users," explained Reed. About Textron Financial Corporation Textron Financial Corporation, a subsidiary of Textron Inc., is a diversified commercial finance company with over $7 billion in managed receivables. Textron Financial is a premier lender to the aviation, golf, vacation interval resort, franchise finance and telecommunications industries offering term loans, leasing, revolving credit and specialty finance products. Textron Financial also provides additional services in the areas of distribution and end-user financing for syndication, equipment appraisal and disposition, portfolio services and insurance brokerage. About Textron Inc. Textron Inc. (NYSE:TXT) is a $13 billion, global, multi-industry company with market-leading businesses in Aircraft, Automotive, Fastening Systems, Industrial Products, and Finance. Textron has a workforce of over 70,000 employees and major manufacturing facilities in 30 countries. Textron is among Fortune magazine's "Global Most Admired Companies." Additional information is available on www.textron.com. CIT, Bank SinoPac and C-ME Join for Tri-Party Finance Agreement; Innovative Financing Pact Eliminates Letters of Credit, Facilitates Global Trading Transactions NEW YORK--(BUSINESS WIRE)----CIT (NYSE:CIT; TSE:CIT.U), the leading global source for financing and leasing capital, announced today the establishment with Bank SinoPac of Taiwan and Cyber Merchants Exchange (C-ME) (OTCBB:CMEE) of a tri-party financial platform. The agreement will eliminate the need for Letters of Credit by allowing exporters in Taiwan to ship merchandize to pre-approved retailers in the United States. Letters of Credit have historically been the predominant means of payment for cross border trading, but are rapidly being supplanted by more creative and flexible financing mechanisms such as tri-party agreements that assure less risk for both exporters and retailers. Through this arrangement, each party will make an essential contribution to expedite transactions between an exporter and retailer while guaranteeing that the terms of the contract are fulfilled. Each of the tri-party agreement participants play an integral role. CIT's Commercial Services unit will guarantee the credit worthiness of the U.S. retailers while Bank SinoPac will provide potential working capital financing and will act as the conduit for foreign manufacturers to receive payment for goods that are shipped to U.S. retailers. It is through C-ME's innovative international factoring agreement that exporters, retailers, international banks and CIT will be linked to the platform, which provides rapid access to global purchasing. John F. Daly, president of CIT Commercial Services, outlined the enormous potential of this unique financing arrangement. "This agreement underscores our commitment to international trade as well as our confidence in the tremendous growth opportunities between our U.S. clients and the Pacific Rim businesses. The huge global trading trend that is unfolding will create immediate cost and administrative efficiencies and our partnership is a step towards the globalization of factoring service for U.S. retailers." Paul C. Lo, the President of Bank SinoPac, highlighted the many factors that contributed to forging this creative agreement for the rapidly evolving global trading community. "Studies we have conducted show that only 30 percent of Taiwan exports rely on Letters for Credit for their financing. We have also found that computer technology has significantly changed the international purchasing payment terms to net 30 or even longer and we foresee that more and more buyers will request these same payment terms. This agreement will provide each party with a level of comfort and financial security -- retailers won't be burdened with Letters of Credit and vendors can have their cash in advance." Frank Yuan, Chairman and CEO of C-ME commented, "Our B2B platform provides Pacific Rim manufacturers the ability to bring their goods to the desk tops of U.S. retailers through the Internet. This tri-party agreement will enable our retail partners to purchase merchandize abroad without having to issue Letters of Credit. In addition, foreign manufacturers are providing financing alternatives to improve their cash flow. C-ME will continue to accelerate the growth of our international sourcing offices to provide a more efficient and cost effective means for our retail partners to purchase globally." About Bank SinoPac Bank SinoPac is one of the new banks established following the passage of the banking regulation amendment in 1989 by the Taiwan government. After almost two years of preparation, the business officially commenced on January 28, 1992. Equipped with years of working experience at foreign banks, the management of Bank SinoPac is renowned for its international vision, banking expertise, innovative managerial philosophy, and effective development strategies. Presently, Bank SinoPac possesses nearly 40 branches in Taiwan and three overseas offices, excluding SinoPac Capital Ltd. (HK), and the thirteen branches of Far East National Bank (USA). Besides general commercial banking services, it also provides special banking services such as fund raising, asset management, securities trading, financial derivatives, and factoring. For more information, visit the company's website at www.banksinopac.com.tw. About C-ME.com The mission of CYBER MERCHANTS EXCHANGE, INC. d.b.a. C-ME.com(http://www.C-ME.com) is to use its proprietary Web-based software to create a global business-to-business e-commerce solution that streamlines the way retailers locate viable merchandise sources. C-ME.com's current retail partners include Factory 2-U Stores (Nasdaq:FTUS) and Burlington Coat Factory (NYSE:BCF). Other retailers include: McWhorter's, Sacks SFO and Susie's Deals which are based in California and L & L Wings which is based in New York. The company is also forming joint ventures in the Pacific Rim to facilitate direct international merchandize sourcing for its U.S. retail partners. C-ME has operations in North America, Asia, Europe and the Middle East. About CIT CIT Commercial Services is the nation's largest provider of factoring, accounts receivable management and lending services. It is a business unit of CIT Commercial Finance, one of six operating groups of The CIT Group, Inc. (NYSE:CIT; TSE:CIT.U). CIT is a leading, global source of financing and leasing capital for companies in more than 30 industries. Managing more than $50 billion in assets across a diversified portfolio, CIT is the trusted financial engine empowering many of today's industry leaders and emerging businesses, offering vendor, equipment, commercial, factoring, consumer and structured financing capabilities. Founded in 1908, CIT operates extensively in the United States and Canada with strategic locations in Europe, Latin and South America, and the Pacific Rim. For more information on CIT, visit the Web site at www.cit.com. Certain of the statements made herein constitute forward-looking statements that involve risks and uncertainties. In such instances, actual results could differ materially as a result of a variety of factors including the risks associated with the effect of changing economic conditions at home and abroad, variations in cash flow, reliance on collaborative retail customers, reliance on intellectual property legislation, use of proprietary un-patented technology, dependence on the Internet and on new product development, variations in new product and service development, risks associated with rapid technological change, and potential of introduced or undetected flaws and defects in products and services and other risk factors detailed in forms filed with the Securities and Exchange Commission from time to time. CONTACT: CIT Ann-Margret Crater, 212/536-9310 ann.crater@cit.com or Stanton-Crenshaw (For CIT) Naya Kolarova, 203/359-8772 naya@stanton-crenshaw.com or C-ME.com Barbara Doonan, 626/793-5000 ir@c-me.com or The Investor Relations Group (For C-ME) Lisa Lindberg, 212/736-2650 TheProTeam@aol.com S&P Affirms North Coast Funding LLC's CP Rating Tice Acquires Two Businesses KNOXVILLE, Tenn.--(BUSINESS WIRE)----Tice Technology, Inc. (OTC BB: TICE) has executed asset purchase agreements to acquire two privately held Knoxville, Tennessee based businesses, LandOak Company, LLC and MidSouth Sign Company, LLC. LandOak is an automobile and equipment leasing business. Customers include Tennessee Eastman. MidSouth has eight years' experience in metal and vinyl sign fabrication. It provides digital property, sign surveys and maintenance agreements to customers nationwide including: American Express, Clayton Homes and Compass Bank. Tice will file a Form 8-K with the Securities and Exchange Commission to disclose the completion of both purchases that were effective January 1, 2001. Management expects to file pro forma financial information as an amendment to Form 8-K within the next 60 days. The transaction involves the issuance of 13,000,000 Tice common shares and assumed certain liabilities in exchange for the assets of the two combined companies. Two of the owners of the private businesses already own common stock in Tice and are members of Tice's board of directors. "Now that we have completed these acquisitions, our attention is turning to maximizing revenue and profit opportunities within the businesses," said Charles R. West, President and CEO of Tice Technology, Inc. "We are pursuing operating synergies between the businesses to reduce overall administrative costs, reduce product costs and facilitate the sales of some products through financing. "At Tice Engineering and Sales, we are preparing our revolutionary new sewing machine, the FS-2000, for its market launch next quarter. We are also nearing completion of the dual head sewing machine designed and manufactured for a specialty products customer. At MidSouth Sign Company, we are pleased with the order backlog in the sign fabrication division, and are entering into a major new contract in the survey division. Operations at LandOak Company, our leasing and rental business, are steady and we expect strong growth from this unit primarily in the leasing side of the business. "With these newly acquired assets we plan to pursue an exchange listing affording greater access and visibility within the financial community. We continue to explore other acquisitions that will be accretive to shareholder value." Tice is a publicly traded holding company providing diverse products and services through three wholly owned subsidiaries: Tice Engineering & Sales, Inc. (founded 1965) provides engineering and technical solutions for specialized, industrial sewing equipment. Tice is widely known in the apparel industry for its patented Electronic Gearing Technology. Tice holds dozens of US and International patents and is the only company to completely design a new sewing machine using 21st Century technology from the ground up. Tice's customer list includes major apparel manufacturers such as Levi Strauss, Vanity Fair and Hart, Schaffner and Marx. MidSouth Sign Company, Inc. sells and produces metal and vinyl signs and National Survey Associates (a division of MidSouth Sign Company Inc.) provides national signage surveys and other services for commercial clients. Customers include American Express, Clayton Homes, and Compass Bank. LandOak Company, Inc. is an automobile and equipment rental and leasing company for individual and commercial clients throughout the upper East Tennessee area. Customers include Tennessee Eastman. NEW YORK--(BUSINESS WIRE)---- Standard & Poor's affirmed its 'A-1' rating on the commercial paper notes of North Coast Funding LLC (North Coast). The rating action follows North Coast's execution of a receivables purchase agreement pursuant to which the conduit will fund up to $75 million to a special-purpose entity for the purchase of a pool of lease receivables originated by an equipment leasing company. The rating on North Coast's commercial paper program is based on liquidity support from liquidity providers with short-term ratings commensurate with North Coast's 'A-1' rating and sufficient pool-specific credit enhancement. North Coast is a multiseller, partially enhanced asset-backed commercial paper conduit sponsored by National City Bank (single-'A'-plus/Stable/A-1), Standard & Poor's said. ---CreditWire Comdisco, Inc. Announces Best Earnings Quarter Ever, Announces Quarterly Cash Dividend ROSEMONT, Ill.--(BUSINESS WIRE)--Jan. 31, 2001--Comdisco, Inc. (NYSE: CDO) today reported operating results for its first quarter ended December 31, 2000. Operating results: For the quarter, Comdisco reported all-time record net earnings of $88 million, or $.56 per common share, compared with $42 million, or $.26 per common share, for the year earlier period. The prior year period includes a $17 million, or $.11 per common share, loss from discontinued operations. Total revenue for the first quarter was $909 million, compared with $876 million, for the prior year period. CEO commentary: Commenting on first quarter results, Phil Hewes, President and Chief Executive Officer, stated, "On December 22, 2000, we stated that as a result of the strength of Comdisco's leasing and ventures business during the first quarter, the company anticipated it would exceed consensus Wall Street estimates by approximately $.10 per share. I am happy to report the strongest quarter in the company's history and that we exceeded the consensus Wall Street estimates of December 22, 2000, by $.16 per share. We set an all-time record for net earnings and exceeded our targets for the quarter in two of our three businesses. Pre-tax earnings for our leasing business were $20 million for the quarter, exceeding our target by $2 million, or 11%. This was a significant accomplishment for a first quarter, as historically, first quarters tend to be our most challenging for leasing pre-tax earnings. Our ventures division experienced another outstanding quarter, exceeding our pre-tax profitability targets by 57%, earning $110 million for the quarter as Comdisco Ventures continues to recognize gains from its portfolio of publicly held securities. The mark-to-market valuation for publicly traded securities within the Comdisco Ventures portfolio was approximately $240 million as of December 31, 2000. Also, during the quarter, the company paid down approximately $505 million, or 32%, of the $1.6 billion of senior unsecured debt (excluding commercial paper or revolving bank lines) that is scheduled to mature in fiscal 2001. The company paid down this debt with a combination of cash on hand, cash flow from operations and the financing of lease receivables." Continued Hewes, "Although two of our three businesses exceeded our targets, we are disappointed with the performance of our technology services business during the quarter. We experienced larger than expected costs in technology services due to our level of investment in the web services business as well as losses associated with our network services business." The company announced on January 9, 2001 that it will stop providing managed network services. "We need to make dramatic profitability improvements in our services business. We have a number of initiatives currently in place to address the problems. I have made it the number one priority of senior services management to focus and execute on our strategic plans," concluded Hewes. Dividend Information: On January 30, 2001, the Board of Directors declared a quarterly cash dividend of $.025 per share to common stockholders. The common stock cash dividend will be payable on March 12, 2001, to stockholders of record on February 9, 2001. Comdisco had 151,415,848 shares of common stock outstanding at December 31, 2000. Safe Harbor: The foregoing contains forward-looking statements regarding Comdisco, which are based on current expectations and assumptions, and which involve risks and uncertainties that could cause results to differ. The company intends that such forward-looking statements be subject to the safe harbor created by Section 27A of the Securities Act of 1933 and Section 21E of the Securities and Exchange Act of 1934. The following lists some of the factors, which could cause results to differ from expectations. As a result of the evolving nature of its services business, the company has limited meaningful historical data in which to base its planned operating expenses. A significant portion of the company's expense levels are based in part on its expectations as to future services revenues, and, to a large extent, are fixed. To attain its services earnings contribution goals for fiscal 2001 the company will have to meet its obligations under the agreements underlying its sales backlog. Also, the company must expand its contract subscription base (through new contract signings and contract renewals), increase its revenues through other technology services, primarily, web availability services, and IT CAP Solutions, and contain costs. The company's ability to obtain new business and realize revenue on its sales backlog depends on its ability to anticipate technological changes, develop services to meet customer requirements on a global basis and achieve delivery of services that meet customer requirements on a domestic and global basis. In addition, with respect to new business opportunities, the company must successfully compete with organizations offering similar services. The company's liquidity depends, in part, on its access to capital markets, specifically medium-term and senior notes, and commercial paper, and on its lines of credit. If the company was not able to refinance its indebtedness or obtain new financing under these circumstances, the company would have to consider other options, including: sales of some assets; sales of equity; negotiations with lenders to restructure applicable indebtedness; or other options available to the company under applicable law. Further, the Company's cash flow from operating activities is dependent on a number of variables, including, but not limited to, the ability of the Company to implement its strategic plan and respond to external market conditions, the ability of the Company to dispose of the securities held by Comdisco Ventures, timely payment by its customers, global economic conditions and controlling operating costs and expenses. Securities held by Comdisco Ventures are generally subject to lockups restricting its ability to sell until several months after an initial public offering. The public market for high technology and other emerging growth companies is extremely volatile. Such volatility may adversely affect the ability of the company to dispose of the securities held by Comdisco Ventures and the value of those securities on the date of sale. Unrealized gains are based upon market and business data available to the Company as of today's date and is subject to change based on additional market and business data as it becomes available. Additional factors that would cause results to differ are discussed in the company's Form 10-K for the year ended September 30, 2000. The company undertakes no obligation to publicly update or revise any forward-looking statement whether as a result of new information, future events or otherwise. About Comdisco: Comdisco (www.comdisco.com) provides global technology services to help its customers maximize technology functionality, predictability and availability, while freeing them from the complexity of managing their technology. The Rosemont, (IL) company offers a complete suite of information technology services including business continuity, managed web hosting, storage, and IT Control and Predictability Solutions(SM). Comdisco offers equipment solutions to key vertical industries, including semiconductor manufacturing and electronic assembly, healthcare, telecommunications, pharmaceutical, biotechnology and manufacturing. Through its Ventures division, Comdisco provides equipment leasing and other financing and services to venture capital backed companies. The company's revenue for the 12 months ended December 31, 2000 was $3.9 billion. Comdisco, Inc. easePoint.com Increases Revenue Streams for Finance Companies MINNEAPOLIS--(BUSINESS WIRE)--Jan. 31, 2001-- Enhanced credit rating system allows for accurate pre-qualification LeasePoint.com today announced that its updated credit rating system gives lenders another way to pre-qualify more deals and, ultimately, secure more revenue. In the traditional leasing scenario, lenders spend valuable time and money wading through a mass of applications that do not match their credit appetite. LeasePoint has developed the solution. The enhanced system allows lender to combine industry-recognized credit decisioning scores with various consumer and commercial criteria and rules. Lenders now filter applications with precise calculations that guarantee a higher percentage of pre-qualified applicants than ever before. "In this latest enhancement, lenders reap the benefit of a newly expanded credit rating scorecard system," LeasePoint.com CIO Bruce Underwood said. "Lender specified scorecards allow lenders to close their application floodgates with razor-thin precision in order to receive only those applications that match their preferred credit profiles. In short, lenders receive an exceptionally high number of pre-qualified applicants." The system allows lenders to tailor fit credit criteria, in addition to various guideline rules, to match their underwriting requirements. An applicant's commercial and consumer criteria are weighted and assigned a score. For an application to be sent to a lender, the total point score must be greater or equal to the lender's preset requirements. About LeasePoint.com Based in Minneapolis, LeasePoint.com develops technologies to simplify and automate the leasing process for lease finance companies and equipment vendors. LeasePoint technologies remove the obstacles of traditional leasing and make the process fast and easy. The company's website is www.leasepoint.com. CONTACT: LeasePoint.com, Minneapolis Elen Bahr 877/841-7500 ebahr@leasepoint.com KEYWORD: MINNESOTA - VenServ, Inc. Announces Acquisition of MacArthur Business Credit, LLC AGOURA HILLS, Calif., Jan. 31 /PRNewswire/ -- VenServ, Inc. ("VenServ"), the premier provider of innovative, web-based product financing solutions, today announced it has acquired Irvine, CA-based MacArthur Business Credit, LLC ("MacArthur"). The acquisition combines MacArthur's direct sales origination model and reputation for strong portfolio performance with VenServ's vendor-driven focus, state-of-the-art technology and clear vision of the future in the product financing arena. Founded in March 1996, MacArthur provides lease financing for a wide variety of equipment to customers in a diverse group of industries. The acquisition establishes a Direct Sales line of business for VenServ, complementing its existing core business of partnering with vendors to provide financing for equipment purchases at the point-of-sale. The combination also rounds out VenServ's senior management team by adding leasing veterans Jeff Chasin and Rich Orozco (formerly President and Executive Vice President of MacArthur) to key management positions. Rich Orozco has taken the post of Senior Vice President, Sales with responsibility for sales in all lines of business. Jeff Chasin, VenServ's new Senior Vice President, Operations, takes over responsibility for operations and underwriter relationships. Both individuals report directly to Robert D. Parker, President and CEO of VenServ. Ethical business practices are a common denominator in this combination. According to Mr. Parker, "The driving force throughout our discussions with Rich and Jeff was a shared belief that our company's reputation is our most important asset. Both VenServ and MacArthur enjoy strong reputations for sound business practices. In fact, this shared belief in ethical dealing is reflected in the combined entity's new mission statement: 'To provide a full range of credit quality customers a fast and efficient means of financing product. We will be consistently reliable and ethical, staffed by friendly, attentive, trained and well-informed people.'" Access to VenServ's proprietary technology is a critical factor in the combination from MacArthur's point of view. "VenServ's technology is clearly on the cutting-edge of the dramatic change in how small-ticket leases are originated and processed," according to Rich Orozco. "Jeff and I decided we needed to join forces with a technology-driven partner in order to remain competitive. We had already considered a number of options and were very excited when VenServ approached us." The acquisition was effective December 15, 2000. VenServ's new Direct Sales line of business will continue to operate primarily from MacArthur's Irvine, CA location. About VenServ: VenServ, Inc. is the premier provider of innovative, web-based product financing solutions. Serving small, medium-sized and Fortune 1000 companies, VenServ provides a quick and efficient method of financing equipment purchases. The company strives to deliver total customer, vendor and underwriter satisfaction through its "high tech, high touch" approach. VenServ's proprietary, fully integratable and web-enabled credit decisioning and application processing system ("VenStat") offers a seamless, secure and scalable solution. VenStat improves information processing, increases sales and expands the client base for VenServ's vendor partners and offers better quality transaction flow to VenServ's underwriter partners. VenServ is backed by Warburg Pincus (see below). More information is available at www.venserv.com or by calling 818-735-0439. About Warburg Pincus: Warburg Pincus is one of the largest and most established private equity investment firms worldwide. It operates from nine offices covering North America, Europe, Asia Pacific, and Latin America. The firm has accumulated more than 30 years of experience and an outstanding track record in serving as a strategic financial partner to more than 400 teams of operating executives engaged in building durable and successful businesses. Warburg Pincus maintains a distinctively long-term and active investment style, deep expertise in key industry sectors including information technology, financial services, media and communications, and health care, and a proprietary global network. For more information, please visit www.warburgpincus.com. SOURCE VenServ, Inc. CO: VenServ, Inc.; MacArthur Business Credit, LLC; Warburg Pincus www.leasingnews.org
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