Headlines----

 

    "Reports of My Death Are Highly Exaggerated"

      Comdisco Second Quarter: $8 Million Loss

        Ken Duffy Remembers Comdisco's Ken Pontikes---

            Golden Eagle Leasing Takes Loss

             Preferred Lease, A CapitalWerks Company  ( official )

              More Salesman Pay Survey Results

                 ( we hope to put these all together for one major

                      report next week---so if you want to contribute,

                      please do so---anonymous, if you wish )

               Intuit Posts Another Record Tax Season/ 5 Million e-Line Tax Return

                 Dun & Bradstreet Partners with Intuit for On Line Services

                    Bankruptcitydata.com--Recommended to You

   

      

          At the North American Truck Shows:

                       LeaseTrading Introduces:

        " First and Only Full-Service Marketplace that Brings Liquidity to

                Vehicle and Equipment Leases"

 

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 United Association of Equipment Leasing Scottsdale, Arizona Conference

 

"I am in Scottsdale at the UAEL conference.It is not particularly well attended,

 but it has not really begun yet, except for the golf tournaments. The resort is average.    

 

Thought you would be here."

 

 name with held

 

 ( Sorry, there will be a Leasing News workshop with a good group of advisors.

   We hope to get some reports about the conference...Have two community

   dinners here and a good friends wedding at Wente Bros. Winery on Sunday.

   I will be at the NAELB New Orleans Conference for a workshop with the

   advisors and a special dinner at Emeril's in the Wine Cellar. editor )

 

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  " Reports of My Death Are Highly Exaggerated"

 

      No, not Mark Twain---TOM WILLIAMS

 

 

         LeaseExchange, or the company formally known as

EquipmentLeasing is still in business!!!  We sure did have a rough go at it

over the last 6 months and did in fact have to let go of all of our

employees including Richard Donat.  He is a good man.  At the same time I

also was going through a divorce with my wife which was extremely painful

and I was pretty discouraged about everything.  As you know I already owned

a leasing company called Paragon Capital which I started in 1995 which was

doing some interesting things online in 1997 and was doing very well when I

decided in late 98 to start LeaseExchange.

 

LeaseExchange was the brain child of both Aaron Ross and myself.  He came from the software

world and I came from the leasing side.  Aaron is in fact training for the Iron Man and

is doing well and still helps out from time to time.  Aaron is one of the

smartest people I have ever had the pleasure to work with but he did not

want to continue with day to day operations with the company once our VC

money was gone and it seemed hopeless or maybe even crazy.  I put a

tremendous amount of time and energy into making this company work so it was

very painful for me to see it struggle and fail.  I knew we could make

money if we changed some things around and reduced the burn.

 

After about 3 months of the company being dormant I decided to rebuild it

with my own money and decided not take the offers on the table to sell our

code and assets.  The system cost over 1.7 MM to develop and launch and I

wasn't willing to sell it off for a fraction of the cost.  I recommitted to

resurrect the company.  The site was rebuilt on our old servers  (They still

work even though they are almost a year old!)

 

If you look close, Leaseexchange redirects to www.123leaseit.com which was our old staging

server which will change back to LeaseExchange on the 21st of May.  A

blessing that made everything come together was that our old engineering

team spun off and started a software company and we agreed to contract with

them to continue to add functionality to the exchange and maintain the

system  (They are intact)  This is not cheap but a lot cheaper than 15

engineers on salary.  Since they are shareholders they were willing to

continue to consult with us and maintain and develop new functionality.

The site is working and we are doing deals (Our Verisign certificate has

expired and will be fixed on the 21st when we launch our new release) but

other than that we are going for it and booking deals.  The new release will

have much more functionality and easier to management deal flow on the

lessor side.

 

We have hired 2 new sales people last month and expect to add another 3

before July.  They are working out of my work/live space which is

commercially zoned in San Francisco.  It isn't the best scenario but it is

inexpensive and the people I have hired believe in what we are doing and

will move to back to a traditional building in a few months. We would have

done is earlier but rentals keep going lower and lower...   People at start

ups always say I was #5 and so on in terms of when they started with the

company.  Here we added A.D.(After Death) to each one to signify the rebirth

of the company. We are also opening an East Coast office in September

located within Miami.

 

We are not in the business of selling vapor ware or bragging about our

technology and talking about how it will change the world.  We are in the

business of booking leases and making money for us, our vendors, and funding

sources.  Our system works, and our vendors are using it and so are our

customers.  We are out in the market actually doing leases.  You need to be

in the market to find out how this is all going to play out.  We are and

learning more and more about the power of the web and its shortfalls.  I

have been wrong more than I have been right but online you can only learn by

doing.  There is no exact science.  If there was a book we all would have

bought it.  It is being written everyday.

 

I guess what I am saying is that I wouldn't count us out.  There will be one

major difference between LeaseExchange and most of the other internet

players in a few months.  LeaseExchange will be profitable.

 

Yours Truly,

 

Tom Williams, CEO

LeaseExchange

tom@leaseexchange.co

 

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   65 Employers---Not a Massacre Here ! ! !

 

Well, I would argue that "eLeasing Companies" have or are going the way of

LeaseExchange.  Equidity is a technology company that has created a credit

origination platform to facilitate multi-channel credit origination for

Financial Institutions and credit origination, coupled with a funding

network, for vendor finance programs.

 

Our genesis was EqualFooting, a small business marketplace for lending

products, ala LiveCapital.  Today, we are selling our infrastructure to

financial institutions and fortune 2000 vendors.

 

You can check out our web site at www.equidity.com.  We have raised $70

million to date and have lending partners like: MBNA, Wells Fargo, and CIT.

 

Yes, it is a crowded space.  But we will be one of the last ones standing.

Rumors have it that eCredit is down to its last 2 months of cash.  Equidity,

LiveCapital, and CapitalStream will most likely survive the shake out.

 

Cheers,

 

John Long

John.Long@Equidity.com

 

  ( We will be adding Equidity with their 65 employees to our eLease list. editor )

 

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              Banruptcity Data On Line

 

    At the National Association of Equipment Leasing  Brokers Conference in New Orleans, there will be a workshop of web sites for the leasing industry.  This is one that I will recommend, as it is the  third site to learn more about Dot Com's demise.

 

 This covers all bankruptcy: www.BankruptcyData.com. This  provides in-depth information on business bankruptcies. The current free dotcom bankruptcy filing list now contains over 90 companies that have filed bankruptcy since November 2000, including Toysmart.com, Wine.com, Furniture.com and Office.com.

 

There also is a paid section, where "Premium subscribers" to the BankruptcyData.com have access to the date each dotcom company has filed, in addition to where, when, and the attorney contact information. The site also offers continued coverage of the public dotcoms that have filed for bankruptcy. The free dotcom bankruptcy list is updated everyday and contains companies with ".com" in their name that have filed bankruptcy in the United States.

 

    The web site provides free bankruptcy news, information on the U.S. Bankruptcy Courts and links to the court web sites. Premium subscribers have access to filing information on every business filing bankruptcy in more than 80 federal districts. The coverage contains contacts, case number and court where the company filed. The business filing database now contains information on over 10,000 business filings.

 

    BankruptcyData.com (www.BankruptcyData.com) is designed for bankruptcy and credit professionals attempting to sift through endless research material. The site provides a wealth of news, financial history, creditor information, reorganization details and other data for over 700 publicly-traded companies. BankruptcyData.com has been accumulating this critical bankruptcy information since 1986. The site contains complete information on public company bankruptcies dating back as early as 1993, and further expansion is ongoing. The extensive public company database can be searched at no charge by assets, Chapter 11 filing date, industry or company name.

    www.BankruptcyData.com is a product of New Generation Research, Inc., a leading bankruptcy research firm founded in 1986. Since its inception New Generation Research has tracked all publicly-traded companies with assets over $50 million throughout their entire bankruptcy program.

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Comdisco, Inc. (NYSE:CDO) today reported operating results for its second quarter ended March

31, 2001.

 

Operating results: Primarily as a result of recording additional reserves for credit losses for

its Ventures operations, Comdisco reported a loss from continuing operations of $8 million, or

$.05 per common share, compared with earnings from continuing operations of $71 million, or $.44

 

 

per common share, for the year earlier period. Overall, the company had a net loss of $54

million, or $.35 per common share, compared with net earnings of $43 million, or $.26 per common

 

 

share, for the year earlier period. Total revenue for the quarter was $940 million, compared

with $1.0 billion for the prior year period.

 

For the six months ended March 31, 2001, the company reported earnings from continuing

operations of $82 million, or $.53 per common share, compared to $131 million, or $.80 per

common share. Overall, the company had net earnings of $34 million, or $.22 per common share,

compared to net earnings of $84 million, or $.52 per common share, for the prior year period.

Total revenue for the six months ended March 31, 2001, was $1.84 billion, versus $1.87 billion,

for the prior year period.

 

CEO commentary: "Since joining Comdisco, I have worked with senior managers and advisers to

review the company's businesses," said Norm Blake, the company's newly appointed chairman and

chief executive officer. "It became apparent during this review that we needed to evaluate our

strategic options. Specifically, it is clear that the growth and profitability of our core

businesses have been challenged by the cost and availability of funds, as well as structural

costs. In addition, the company incurred higher interest costs, which in part, are associated

with the debt incurred to finance discontinued operations.

 

Moreover, it was necessary to take additional write-offs and reserves associated with the

previously announced decisions to exit Prism Communication Services and Network Services.

 

We believe the charges taken with respect to Comdisco Ventures were necessary given the recent

and rapid decline in the economic environment for venture capital-backed companies. Comdisco

continues to honor funding commitments to which it is obligated. We also have worked to

strengthen Ventures' management and credit practices to maximize value.

 

During the review process, we have retained the services of Goldman, Sachs & Co. and McKinsey

and Company to advise us in considering various strategic alternatives that best serve the

interests of our stake holders. That process is continuing. Given the sensitivity of these

matters, we are not at liberty at this time to disclose the process or timing of these actions.

 

While the company's core businesses in leasing and in services remain sound, Comdisco will not

achieve the level of earnings previously forecast primarily as a result of changing economic

conditions, the credit quality of the Ventures portfolio, our cost of funds, limited access to

the company's traditional funding sources, and other developments. Having recently arrived at

Comdisco and with our initial strategic review still underway, I am not prepared to provide any

earnings guidance regarding the company's current fiscal year at this time," Blake said.

 

Explanation of Charges: During the second quarter of fiscal 2001, the company initiated a

strategic review of all business segments. As a result of this review and deteriorating market

conditions, it was determined that write-offs and reserve provisions should be recorded for

certain assets of its Ventures operation. In addition, additional reserves and write offs were

taken relative to the exit costs of Prism Communication Services and Network Services.

 

Continuing Operations:

 

Ventures: The company determined that approximately $206 million of additional reserves for

Ventures portfolio credit losses were required. The company wrote off approximately $100 million

 

 

of non-performing loans during the quarter, leaving a balance of $210 million in the reserve for

 

 

credit losses as of March 31, 2001.

 

Discontinued Operations:

 

Prism: The company re-evaluated its estimated proceeds from the sale of certain assets of its

discontinued Prism operations, based primarily on current market conditions for such assets. As

a result, the company recorded a noncash pre-tax charge of $30 million, $18 million after tax,

or $.12 per common share, to write down these assets to current estimated fair market value.

Loss from discontinued operations of Prism for the three and six months ended March 31, 2000 was

 

$26 million, or $.16 per common share, and $43 million, or $.26 per common share, respectively.

 

Network Services: Network consulting has been terminated and the network management services are

 

being transferred to a new provider. The termination and transfer resulted in a pre-tax charge

of $38 million, $24 million after tax, or $.15 per common share. The current quarter pre-tax

loss from discontinued operations was $7 million, $4 million after tax, or $.03 per common share

 

compared to a loss of $2 million, or $.02 per common share, in the year earlier period. Loss

from discontinued operations of Network Services for the six months ended March 31, 2001 and

2000 was $8 million, or $.05 per common share, and $4 million, or $.02 per common share.

 

Dividend Information: On May 2, 2001, the Board of Directors voted to suspend the payment of

quarterly dividends on its common stock until the company's liquidity and capital position

warrants the resumption of dividend payments.

 

 

About Comdisco

 

Comdisco (www.comdisco.com) provides technology services worldwide 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, health care,

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 twelve months ended March 31, 2001 was

$3.8 billion.

 

CONTACT: 

 

Comdisco, Inc. Records Second Quarter Loss Resulting From Write-Offs and Reserve Additions;

Suspends Quarterly Cash Dividend

 

 

 

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  Comdisco's Ken Pontikes---Remembered

 

As you know,  I don't often comment but I believe you are doing a great

service to this industry on many levels and felt a word on the tragic events

at Comdisco is merited.

 

I knew Ken Pontikes, the now deceased CEO and founder of Comdisco. We grew

up in the same blue collar South Chicago neighborhood and neither of us

inherited a dime. We started our businesses at about the same time. He grew

huge, I grew small but we both survived and thrived. In 1981 or 82 we

attended a charity event with our wives. We had both been Sox fans until the

early 60s when the franchise went down. But in '81-2 we were following da

Cubs. At the charity event they were auctioning an original pennant, one of

14 that flew atop Wrigley Field and carried the "WF" crest. The flag was

tattered but that didn't matter to us. I out bid Ken that nite $600. to

$575. and got the flag! Everybody knew who he was but not many knew me. The

bidding was fun and raucous. At the end Ken went to the prize lady and said,

"I'd like one too, and I'll match Duffy's bid if you can work it out". Since

one of the event chairladies was a Wrigley, Ken got his flag and Infant

Welfare got double the money. He probably gave them another $10k that no

one ever knew about. A hard nosed businessman but a terrific guy.

 

Ken's son took over after his untimely death two years ago. And as many sons

do, he thought he was "entitled" to run one of the finest companies ever

built. My guess is he was either scared to death or astoundingly arrogant.

The story of his missteps is public and tragic. His $300 million dot.com

investment is today worth $1.83 if that. He resigned as CEO a few weeks ago,

finally admitting he was in over his head. Today he placed 2.5 million

Comdisco shares for sale and will exit stage left with $25 or so million, if

he's lucky, that he had nothing to do with earning. And behind him for all

intents and purposes lies a bankrupt shell.  Just wanted to remind people

that what Comdisco has become is not what it's founder intended nor did he

cause. Raise a glass to Ken Pontikes, a legend in our time. (get a jug from

Foremost Liquors, it's easier than wine.com). Have a nice day.

 

Ken Duffy

kduffy@summitnational.com

 

 

 

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  Mark Seif---Preferred Lease, A CapitalWerks Company

 

The rumor making the rounds that Mark Seif has left Preferred Capital because he

won $300,000 in Las Vegas is not completely true.

 

"No truth to most of it.  I did go to Vegas to play in the World Series of

Poker.  I had a good trip.  I am currently there now competing in World

Series events daily."

 

Mark Seif

 

This information was also received:

 

"He has made the decision to open his own law practice and will continue to

represent Preferred Lease, A CapitalWerks Company. As far as his winnings in Vegas,  I'm glad

someone can finally bring some of their good luck back to the California economy.  Please leave

my name out of this.  Thanks"

 

 Name With Held

    

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  More Salesman Pay Survey

 

 We will compile all this information eventually into one report.  If you send

 in your information, we will not quote you, unless you specifically allow us,

 and we will verify that with you so we do not make a mistake.  Your name

 and company will be held confidential.

 

 

 #1  Lessor

 

I work for a leasing sub. of a large foreign bank.Mostly small ticket. Bases are in the

30's-40's depending on experience. We get .008 of volume with a kicker on spreads that exceed

650 over. Quotas are $6mm-10mm depending on territory.

               

 

 

   Discounter/SuperBroker

 

 

#1

 

 From your survey it appears that we may be giving the shop away.  We

have a very simple commission only program.  As a small to mid ticket

lessor broker/discounter we pay 50% of the gross fee on the

transaction.  Higher amounts up to 60%