Headlines---

   OnLine Financial Technology Firm Xigo Closes Down

       Trinity Industries Posts $74.4 Million Loss ( not Trinity Leasing or Trinity Capital )

           Corona America Financial Merges with TotalFunding.Com or Vice-Versa

             How to Get Bob Baker’s New Video Tape Series

              Leasing News Advisory Board Meeting

                U.,S. Senate Changes To Effect Economy

Please pass this on to a colleague.  We have no display advertising or banners.

We are trying to build our readership, and look for most of our stories from

our readers as “leads” or “on the record”  or “off the record.”

 Online Financial Technology Firm Xigo Closes Down

SAN FRANCISCO—Xigo, a developer of online financial technology, said it is closing down. According to CFO Skip Smith, the company could not secure the additional funding it needed. Mr. Smith said the company still has a handful of employees on staff while it tries to sell its assets. He would not say how many employees the company originally had on staff. Xigo’s real-time technology searches through streaming data to provide users with financial and investment information via e-mail, cell phone, or  pager. Last May the company raised $22 million in a second round of financing from Capital Z Financial Services Fund II, Angel Investors LP, New Enterprise Associates, and John McKinley, Jr., executive vice president and CTO of Merrill Lynch.

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~‘

I just got a fax from Corona America Financial a small leasing company in Southern California.  They have been purchased by TotalFunding.com.  They refer to it as a merger.

Name With Held

  ( We have confirmation of this and hope to have a full story soon. editor )

==============================================================

Fundamentally, CapitalStream is in the trust relationship game where sensitivity around customer data security is paramount. If we blow this, we blow everything! Which is why we stringently limit exposure of customer data to a very select group of employees. We also have all employees sign confidentiality agreements that endure after their time with us. Lastly, we enshrine the core tenets of a trust relationship into the sales contract we sign with our customers. We would be nuts not to treat customer information with utmost seriousness.

Doug Bryers, Director of Marketing

www.capitalstream.com

Certified Lease Professional Program---

You can call Cindy Spurdle  of the CLP Foundation  at 610-687-0213 or visit the website at  www.clpfoundation.org.

Kit, thank you for hosting a most enjoyable dinner for the Leasing News advisory board in New Orleans.  I believe the advisory board meeting at the NAELB Convention was very beneficial to all of us board members, and the open discussions at both the NAELB and UAEL Conventions provided important feedback.  Also, I am glad you encouraged me to attend my first NAELB meeting.  I found it very productive in terms of possible business opportunities for Kropschot Financial Services, and I have sent in my NAELB membership application.

I have heard almost entirely very positive reactions to Leasing News at the ELA, EAEL, UAEL and NAELB conferences I have attended in the past 5 weeks.  You are providing a very valuable service to people in the equipment leasing industry, and it is appreciated.  I will keep you informed of possible stories where I do not have a confidentiality issue, but I know that you realize most of my inside information is told to me in confidence and I must respect that confidence.  Do not hesitate to use me as a sounding board though.

I hope you will consider the Leasing News revenue opportunities we discussed in the advisory board meeting so that you can hire an assistant with some leasing industry knowledge to take some of the load off your shoulders and not incur losses on Leasing News.  Keep up the good work!

Bruce Kropschot

Kropschot Financial Services

116 Estuary DriveVero Beach, FL 32963

(561) 234-4544

(  Thank you.  We are very glad to have Bruce Kropschot on our advisory board.

We will be adding several new advisory board members, making some changes that readers may soon start to see....including a “classified section” where those seeking a job can post for free.  We have been asked to do this for quite some time, and it definitely is needed.  While there are many great internet employee firms, and I have used bajobs, hotjobs, monster.com, perhaps we can be of benefit to people such as those laid off at BayView Capital, Bancorp Financial, and other companies.  We are working on a system that would use something no one else is doing, plus keeping it simple...We are also considering a paid section for employers for “help wanted,” and perhaps some other features.  We are going to make it “classified ads” plus promote in the news.

One thing we learned from our meeting at the United Association and the National

Association of Leasing Brokers is how many readers are not aware of our website; what it contains.

We are working on changes now and hope to have this up and running before the end of June.

Here is how it stands now:

Index

             past news reports—headlines/chronological order

Articles

            written for leasing news on various topics

Cartoons

Contact Us

Customer Complaints

          applicant, lessee, lessor, broker

Editorial Staff

          advisory board to Leasing News, mission statement

eLease

     on line leasing brokers, super brokers, lessors, service, software

Features

       cartoons, firewall reports on the internet and technology, Sunday sermon

Firewall Report

Links

        non-profit leasing associations, dues, dues comparison chart

Meetings

           leasing association meetings—calendar

Policy Statement

Sunday Sermon

The List

         sold, closed, “in trouble”, major changes

Whatever happened to?

            leaders of the leasing industry, where are they today?

GOT A CREDIT CARD TO TODAY FROM BALBOA CAPITAL  MEMBER ELA/UAEL/BBB

PREQUALIFIED UP TO $150,000

RECEIVE UP TO $5000 CASH BACK

CREDIT APPROVAL IS AT THE SOLE DISCRETION OF BALBOA CAPITAL AND/OR ITS AGENTS & ASSIGNS

Kit, Thought we should lighten the mood a little, considering the holidays are coming up. What about a few humorous stories from Nawleans?

I can begin with 2. What about the vp of an exhibiting funder who was so hung over on his flight home on Sunday that he checked himself into a hospital in ******, and told everybody it was a heart problem ???

Also the broker who was knocked down the escalator with several other woman at the Hilton by a drunk, and when the drunk proceeded to mouth off at his innocent victims, our rather small broker knocked him out cold. Way to go....!

Can I remain anonymous?

( I hope the exhibiting funder can remain anonymous, too. editor )

Several Readers have asked be about the video tapes that Bob Baker, Wildwood Financial, especially made “ at cost “ as a gift for the National Association of Equipment Leasing Brokers.  Here is a copy from their magazine about the tape and its contents.

Bob Baker, Director of Education

After receiving numerous requests for more educational tools, an Education Series video tape has been developed.

The tape series relays the nuts and bolts of the small ticket leasing arena. These tapes can be used for training new hires, as well as a review for seasoned professionals.

The tapes are accompanied by a workbook that can be followed as the tapes are viewed. All of the  proceeds received from sales of these tapes goes directly to NAELB.

Tape Six Packaging (Presentation to Funding Sources)

Mini Lease Criteria

Package Lease Criteria

Tape Seven

Documentation

Tape Eight

Fraud in Leasing

Recognizing Fraud

Preventing Fraud

Ethics in Leasing

Ethical Considerations

NAELB Code of Ethics

( I do not know what the price is today, but there was a New Orleans Conference Special---and I believe it was $199.  I ordered a set to help train new people and also as a refresher course for staff at American Leasing. )

I read the comments of Mr. J.Thomas Williams of LeaseExchange with quite a bit of interest.  His commentary shows a lucid perspective of the state of the “dot com” leasing initiatives.  While I agree with him that his “picks” by far show the most promise in their respective classes for on-line business, he doesn’t address how these companies will compete with traditional lessors/commercial lenders (Capital Stream excepted as they are not competing for leasing business). 

I raise this question because there are many companies, both large and small(LeaseNOW included) who have had profitable business models for years.  As this group continues to leverage technology and automate their current businesses, it will become increasingly difficult for the VC backed on-line survivors to garner market share.  Anyone in business will tell you that it is much cheaper, whenever possible, to take customers from someone else than it is to create a brand new customer base.  Those competitors that already have the customer base have the value of “occupancy”, however, and will not go quietly into the night.  “Occupancy” by a formidable competitor, who is protecting an existing investment that was made to create the customer, is a huge obstacle to overcome.  I have not yet seen enough of a proprietary advantage, in either pricing or service, put forth by any of the on-line companies, to make it worth while for a customer to abandon an existing trust relationship for a completely new business model. Although the traditional “brick and mortar” lessor may lag behind in deploying the sophisticated technology of, say a Pure Markets, they can deploy less sophisticated technology at a much lower cost and increase the investment in customer retention. This will minimize the impact of the more sophisticated technology which is why the on-line guys just can’t mount the big proprietary advantage that is required to make businesses abandon their current vendors and leasing companies. This makes displacing the company, who currently occupies the account, an expensive proposition.

The other reason that one would burn millions in venture money is to build a “brand identity”.  I believe that this is also a flawed strategy in the dot com world.  Unlike consumers, businesses pay much less attention to brand equity.  Indeed, if you were to ask 100 people outside the leasing industry to name the top 5 leasing companies in the US, what percentage of the sample would name more than 2 companies in excess of 60% of the time? How many people would name companies that are no longer in business? I would argue that not very many would even know 5 companies.  Unless and until the “brand name” means something to people outside our industry, brand building is wasted money.

I also believe that the surviving on-line companies have learned that the “end user” was not the way to go to source their business.  The early initiatives were aimed directly at the small business owner who was supposed to log on and subject themselves to an “auction process” to get the best deal.  The “parity price/parity product” nature of the small ticket business was going to be the undoing of the traditional leasing company.  Instead it was the undoing of the purveyors of the “auction” model who saw so much opportunity in a “commodity” small ticket market.  It was expected that business owners would log on by the millions to shave .25 basis points off their $18,000 transaction by securing bids from five or six lenders.  Somebody forgot that the .25 basis point difference on a deal that size amounts to a couple of dollars a month on the payment. It is after all, the “monthly investment” which the customer “buys”.  You can rest assured that vendors, who had existing relationships with leasing companies, weren’t going to let a few dollars stand in the way of closing the deal now. The industry has been moving toward rapid response; getting answers to vendors while the customer is still hot to close.  What vendor in his right mind would let the customer go “shopping” for the best financing deal when the vendor could make it happen on the spot at the same payment?  From this experience the on-line people learned that the vendor, at least for the foreseeable future, is controlling the deal flow.  The leasing product itself is the by-product of the customer’s desire to acquire something.  That will rarely happen without a vendor being involved.

The last point is that the on-line people were acting as brokers.  One who contacted us wanted 300 basis points per funded transaction to refer transactions to us because we used the SBSS credit desk system from Fair-Isaac and that would match up with their model. This fee would have priced me completely out of the running on a small ticket 36 month deal.  It could not be justified. For all their talk about efficiency the dot coms were still trying to bang home 8-10 points a deal.  It just wasn’t workable.  Any lessor with a good website and an interface to a scoring system could mount virtually the identical service offering at half the price to the customer.  There’s no mystery as to why the dot coms are no longer around.

Mr. Williams story about the VC at the cocktail party is particularly interesting because these guys want you to burn cash so that they can hopefully give you more.  Each time they give you money they take another piece of the company you’re building.  It’s like feeding heroine to a junkie.  If you are successful the alleged payoff for your remaining 5% is enormous when the IPO happens.  How many of our colleagues had successful IPO’s in the last 2 years? 

When the next “gold rush” occurs, and it undoubtedly will, my advice would be to invest your money in a store selling picks and shovels to the miners.  It will take you a little longer to build your business and you’ll be so busy that you may not have time to go out and stake a claim.  When the rush is over, however, you’ll be happy that you engaged in a long term strategy and there will be a lot of very cheap, hardly used picks and shovels that you can recycle to take advantage of yet a second profit opportunity.

There are a lot of people in this industry wondering what happened to the good ole days in this business.  I think these are the good ole days.  It just depends on your perspective.Congratulations to NAELB on a successful conference in New Orleans.

Bob Rodi

LeaseNOW, Inc

www.leasenow.comdrlease@leasenow.com

1-800-321-LEAS(5327) x101

DALLAS / -- Trinity Industries, Inc., (NYSE: TRN) today reported financial results for the full year and fourth quarter of fiscal 2001.

For the fiscal year ended March 31, 2001, the Company reported net income of $36.5 million (before unusual charges), or 97 cents a diluted share, on revenues of $1.90 billion.  This compares with net income of $165.5 million, or $4.15 a diluted share, on revenues of $2.74 billion in the fiscal year ended March 31, 2000.  After unusual charges of $173.3 million ($110.9 million after tax), the Company reported a Fiscal 2001 net loss of $74.4 million, or $1.98 a diluted share.  The unusual charges recorded in Fiscal 2001 related primarily to restructuring the Company’s railcar operations, various investment and asset write-downs, and severance costs.

For the fourth quarter ended March 31, 2001, the Company reported a net loss of $4.0 million (before unusual charges), or 11 cents a share, on revenues of $418.7 million.  This compares with net income of $33.9 million, or 87 cents a diluted share, on revenues of $646.4 million in the fourth quarter of the prior fiscal year.  After unusual charges of $55.8 million ($35.7 million after tax), the Company reported a net loss for the fourth quarter of Fiscal 2001 of $39.7 million, or $1.08 a diluted share.  The unusual charges recorded in the fourth quarter of Fiscal 2001 include previously announced unusual charges of approximately $25 million plus approximately $16 million in additional charges related to plant closings and $14.8 million in litigation reserves related to an adverse jury verdict also announced earlier.

“The actions we have taken during fiscal 2001 to confront the declining economy and refocus our resources on our core businesses as indicated in previous announcements should strengthen us to meet the challenges of fiscal 2002,” said Timothy R. Wallace, Trinity’s chairman, president and CEO.  “The North American railcar market is not showing signs of recovery at this point. Pricing for railcars remains very competitive with a large portion of our customers electing to lease cars rather than purchase them.  This coincides with our decision to expand our leasing business.

“Fortunately Trinity’s Construction Products and Inland Barge businesses are gaining momentum.  Since the beginning of April, Trinity’s construction related businesses have continued to improve their earnings as a result of a return to more normal weather conditions.  Our barge manufacturing business is improving their backlog of barges by continuing to receive orders at a steady pace.  Trinity’s U.S. industrial business has stabilized from an operational point of view.  We are pleased that our other business groups are able to provide some earnings coverage during the steep decline in demand for new railcars in North America.  Until we see more improvement in the North American rail market, we believe it is reasonable to expect that our net income in fiscal 2002 will be comparable to our fiscal 2001 net income (before unusual charges),” Wallace said.

Trinity Industries, Inc., with headquarters in Dallas, Texas, is one of the nation’s leading diversified industrial companies.  In this release, Trinity is reporting five principal business segments:  the Railcar Group, the Inland Barge Group, the Parts & Services Group, the Construction Products Group, and the Industrial Group which is a change from previous reporting. Amounts reported in this release for prior periods have been restated to conform with current presentation.  Trinity’s web site may be accessed at http://www.trin.net.

This news release contains “forward looking statements” as defined by the Private Securities Litigation Reform Act of 1995 and includes statements as to expectations, intentions and predictions of future financial performance. Statements that are not historical facts are forward looking.  Readers are directed to Trinity’s Form 10-K and other SEC filings for a description of certain of the business issues and risks, a change in any of which could cause actual results or outcomes to differ materially from those expressed in the forward looking statements.  Any forward looking statement speaks only as of the date on which such statement is made.  Trinity undertakes no obligation to update any forward looking statement or statements to reflect events or circumstances after the date on which such statement is made.

Income (loss) before  

income taxes          53.3    (6.3)  (62.1)    262.9      57.0    (116.3) 

Provision (benefit)  

Revenues:  

Construction Products  

Operating profit (loss): 

Group                 10.0     3.5      (4.8)     63.4     22.1    (11.4) 

The Company has changed the presentation of segment information as follows:  Highway Products and Concrete & Aggregate businesses are reported in the Construction Products Group, Operating Profit amounts are after allocation of Shared Services charges, and certain minor reclassifications between groups were made.  All prior year amounts have been restated to conform to current presentation.

March 31, 2000  March 31, 2001 

Short-term debt and accounts payable