================================================================= COMDISCO BANKRUPTCY NEWS Issue Number 1 ----------------------------------------------------------------- Copyright 2001 (ISSN XXXX-XXXX) July 17, 2001 ----------------------------------------------------------------- Bankruptcy Creditors' Service, Inc. 609-392-0900 FAX 609-392-0040 ----------------------------------------------------------------- COMDISCO BANKRUPTCY NEWS is published by Bankruptcy Creditors' Service, Inc., 24 Perdicaris Place, Trenton, New Jersey 08618, On an ad hoc basis (generally every 10 to 20 days) as significant activity occurs in the Debtors' cases. Each issue is prepared by Peter A. Chapman, Editor. Subscription rate is US$45 per issue. Copying and re-mailing of COMDISCO BANKRUPTCY NEWS is prohibited. ================================================================= IN THIS ISSUE ------------- [00000] HOW TO ORDER A SUBSCRIPTION TO COMDISCO BANKRUPTCY NEWS [00001] BACKGROUND & DESCRIPTION OF COMDISCO [00002] COMDISCO'S CONSOLIDATED BALANCE SHEET AT MARCH 31, 2001 [00003] COMPANY'S PRESS RELEASE CONCERNING CHAPTER 11 FILING [00004] COMDISCO DEBTORS' CHAPTER 11 DATABASE [00005] LIST OF THE LARGEST HOLDERS OF COMDISCO BANK DEBT [00006] LIST OF THE LARGEST REGISTERED COMDISCO BONDHOLDERS [00007] LIST OF COMDISCO'S LARGEST TRADE CREDITORS [00008] LIST OF PRISM COMMUNICATION'S LARGEST UNSECURED CREDITORS [00009] HP ANNOUNCES PACT TO ACQUIRE TECHNOLOGY SERVICES BUSINESS KEY DATE CALENDAR ----------------- 07/16/01 Voluntary Petition Date 07/31/01 Deadline for filing Schedules of Assets and Liabilities 07/31/01 Deadline for filing Statement of Financial Affairs 07/31/01 Deadline for filing Lists of Leases and Contracts 08/05/01 Deadline to provide Utilities with adequate assurance 09/14/01 Deadline to make decisions about lease dispositions 10/14/01 Deadline to remove actions pursuant to F.R.B.P. 9027 11/13/01 Expiration of Debtors' Exclusive Plan Proposal Period 01/02/02 Expiration of Debtors' Exclusive Solicitation Period 07/15/03 Deadline for Debtors' Commencement of Avoidance Actions Organizational Meeting with UST to form Committees Bar Date for filing Proofs of Claim First Meeting of Creditors pursuant to 11 USC Sec. 341 ----------------------------------------------------------------- [00000] HOW TO ORDER A SUBSCRIPTION TO COMDISCO BANKRUPTCY NEWS ----------------------------------------------------------------- COMDISCO BANKRUPTCY NEWS is distributed to paying subscribers by electronic mail. New issues are published on an ad hoc basis as significant activity occurs (generally every 10 to 20 days) in the Debtors' cases. The subscription rate is $45 per issue. Newsletters are delivered via e-mail; invoices, transmitted following publication of each newsletter issue, arrive by fax. Distribution to multiple individuals at the same firm is provided at no additional charge; folks outside of your firm should set-up and pay for their own subscriptions. Subscriptions may be canceled at any time without further obligation. To continue receiving COMDISCO BANKRUPTCY NEWS, please complete the form below and return it by fax or e-mail to: Bankruptcy Creditors' Service, Inc. 24 Perdicaris Place Trenton, NJ 08618 Telephone (609) 392-0900 Fax (609) 392-0040 E-mail: peter@bankrupt.com We have published similar newsletters tracking billion-dollar insolvency proceedings since 1990. Currently, we provide similar coverage about the chapter 11 cases involving Pacific Gas and Electric Company, Reliance Group Holdings & Reliance Financial, The FINOVA Group, Inc., Laidlaw, Safety-Kleen, Fruit of the Loom, Pillowtex, Warnaco, Bridge Information Services, Service Merchandise, Imperial Sugar, Vlasic Foods, 360networks, Winstar, ICG Communications, PSINet, Lernout & Hauspie & Dictaphone, W.R. Grace & Co., Owens Corning, Armstrong World Industries, USG Corporation, AMF Bowling, LTV, Wheeling-Pittsburgh, The Loewen Group International, Inc., Harnischfeger Industries, Inc., Vencor, Inc., Sun Healthcare Group, Inc., Mariner Post-Acute & Mariner Health, Genesis Health & Multicare, and Integrated Health Services. ================================================================= [ ] YES! Please enter my personal subscription to COMDISCO BANKRUPTCY NEWS. Name: ---------------------------------------------- Firm: ---------------------------------------------- Address: ---------------------------------------------- ---------------------------------------------- Phone: ---------------------------------------------- Fax: ---------------------------------------------- E-Mail: ---------------------------------------------- ----------------------------------------------------------------- [00001] BACKGROUND & DESCRIPTION OF COMDISCO ----------------------------------------------------------------- Comdisco, Inc. 611 N. River Road Rosemont, IL 60018 Telephone (847) 698-3000 Fax (847) 518-5440 http://www.comdisco.com In its early years, through the 1970s and 1980s, Comdisco (NYSE:CDO) engaged primarily in procuring and placing new and used computer equipment, principally mainframe and related peripherals. Today, Comdisco 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 Company offers a complete suite of information technology services including business continuity, managed web hosting, storage, and IT Control and Predictability Solutions(SM). Comdisco also offers equipment solutions to key vertical industries including semiconductor manufacturing and electronic assembly, healthcare, telecommunications, pharmaceutical, biotechnology, and manufacturing. Comdisco's major customers are: * NEC Electronics * Lucent Technologies, Inc. * Samsung Austin Semiconductor * Solectron Corp. * Flextronics International Inc. * Motorola, Inc. * Southwestern Bell Telephone Co. * Nortel Networks, Inc. * AT&T Solutions, Inc. / Banc One * Genuity Solutions, Inc. * Ford Motor Co. * Caterpillar, Inc. * Sabre, Inc. Through its Ventures division, Comdisco provides equipment leasing and other financing and services to venture capital- backed companies. Comdisco's largest venture commitments are to: * Avici Systems, Inc. * Blue Nile, Inc. * Cereva Networks, Inc. * Chorum Technologies, Inc. * Corio, Inc. * eConvergent, Inc. * HomeGrocer,com * living.com, Inc. * New Edge Networks, Inc. * Oresis Communications, Inc. * Deutsche Bank Securities * BancAmerica Robertson Stephens The Ventures division also picked-up large equity stakes in: * Avici Systems, Inc. * Ciena Corporation * Corvis Corporation * Equinix, Inc. * Handspring, Inc. * Niku Corporation * ONI Systems Corp. (formerly Optical Networks, Inc.) * Quantum Effect Devices, Inc. * Redback Networks, Inc. * Turnstone Systems, Inc. With more than 100 locations around the world, Comdisco serves more than 3,000 customers in North America, South America, Europe and the Asia/Pacific Rim. As of June 1, 2001, the Company employed approximately 2,300 full-time employees. For the fiscal year ended September 30, 2000, the Company generated consolidated net revenues of approximately $3,900,000,000 and administered assets of $8,800,000,000. The Management Team To support its business operations, the Company recruited new senior management during 2001. 1n February 2001, Comdisco hired Norman P. Blake, Jr. as its new Chairman and Chief Executive Officer. During June and July 2001, the Company hired Michael A. Fazio as Executive Vice President and Chief Financial Officer, Robert E. T. Lackey as Senior Vice President and Chief Legal Officer and Ronald C. Mishler as Senior Vice President and Treasurer. These individuals, Comdisco says, will be critical to a successful restructuring. The Prism Acquisition In February 1999, Comdisco acquired Prism Communication Services, Inc., a provider of dedicated high-speed connectivity, for approximately $52,000,000 in cash. From the date of acquisition through September 30, 2000, Comdisco provided Prism with $478,000,000 for expansion of its network and for its operating costs. Prism's operations through September 2000 resulted in significant cash losses. On October 1, 2000, Comdisco's Board of Directors voted to cease funding the ongoing operations of Prism. On October 1, 2000, the Prism Board of Directors voted to cease operations and pursue the immediate sale of Prism's assets. Comdisco's wind-down of Prism has continued since that time. Venture Capital Lease Losses The venture leases, venture debt and direct equity financing provided by the Comdisco Ventures group to venture capital-backed companies in the technology and Internet-based industries are, by their nature, high risk. The Ventures group's net revenue for fiscal 2000 was $673,000,000. However, during the first quarter of 2001, a market downtown in the technology and Internet-based sectors resulted in a substantial decrease in the revenues of the Ventures group. As a result, the Ventures group had a pretax loss of $30,000,000 for the three months ended March 31, 2001 compared to the pretax earnings of $110,000,000 for the previous three month period ended December 31, 2000. These market conditions have continued to deteriorate during the second calendar quarter of 2001. Liquidity Evaporated As a result, in part, of the losses associated with Prism and the Comdisco Ventures group, the Company's cash reserves, overall financial performance and financial condition were negatively impacted. As a result of the erosion of the Ventures group's business and the losses associated with Prism, the Company's debt ratings were downgraded below investment grade and the Company lost access to the commercial paper market. In order to retire commercial paper obligations and other scheduled debt maturities and to finance operations, Comdisco borrowed the remaining availability under the prepetition credit agreements in April, 2001. The Leverage Problem Another fundamental challenge faced by the Company, Comdisco days, is the tenor of their debt structure, which involves relatively short-term debt maturities over the next several years and longer-term lease and financing obligations associated with their principal business products. Accordingly, although the Company's operations generally generate sufficient cash to meet their working capital needs, without access to the commercial paper market, Comdisco could not generate sufficient cash to retire all of the debt maturities scheduled to be repaid during 2001 and 2002. The Asset Sale & Turnaround Plan As a result of these challenges, earlier this year, Comdisco retained Goldman Sachs & Co. and McKinsey & Co. to evaluate strategic alternatives, including the sale of all or a portion of Comdisco's businesses. This strategic review led to this week's announcement concerning the sale of the Availability Solutions business to Hewlett-Packard Company and the evaluation of the potential sale of one or more of the Leasing business units through court-approved competitive bidding procedures. In addition to H-P: * IBM * EMC * General Electric Capital Corporation * Silverlake Equity Partners * Sunguard are on Comdisco's short list of potential purchasers. Comdisco looks to the chapter 11 process to finalize and implement their restructuring strategy. ----------------------------------------------------------------- [00002] COMDISCO'S CONSOLIDATED BALANCE SHEET AT MARCH 31, 2001 ----------------------------------------------------------------- Comdisco, Inc. and Subsidiaries CONSOLIDATED BALANCE SHEETS At March 31, 2001 (Unaudited) ASSETS Cash and cash equivalents ....................... $468,000,000 Cash - legally restricted ....................... 66,000,000 Receivables, net ................................ 936,000,000 Inventory of equipment .......................... 98,000,000 Leased assets: Direct financing and sales-type ............... 2,068,000,000 Operating (net of accumulated depreciation) ... 3,021,000,000 -------------- Net leased assets ........................... 5,089,000,000 Property, plant and equipment, net .............. 200,000,000 Equity securities ............................... 270,000,000 Other assets .................................... 397,000,000 -------------- $7,524,000,000 ============== LIABILITIES AND STOCKHOLDERS' EQUITY Notes payable ................................... $1,174,000,000 Term notes payable .............................. 658,000,000 Senior notes .................................... 2,910,000,000 Accounts payable ................................ 152,000,000 Income taxes .................................... 170,000,000 Other liabilities ............................... 565,000,000 Discounted lease rentals ........................ 1,113,000,000 -------------- 6,742,000,000 -------------- Stockholders' equity: Preferred stock $.10 par value Authorized 100,000,000 shares; Series C and Series D ................................ -- Comdisco stock $.10 par value Authorized 750,000,000 shares; issued 225,503,200 shares ................... 23,000,000 Comdisco Ventures stock $.10 par value Authorized 750,000,000 shares (none issued).. -- Additional paid-in capital .................... 365,000,000 Accumulated other comprehensive income (loss) . (100,000,000) Retained earnings ............................. 1,078,000,000 -------------- 1,366,000,000 Common stock held in treasury, at cost ........ (584,000,000) -------------- Total stockholders' equity ................ 782,000,000 -------------- $7,524,000,000 ============== ----------------------------------------------------------------- [00003] COMPANY'S PRESS RELEASE CONCERNING CHAPTER 11 FILING ----------------------------------------------------------------- Comdisco's Technology Services Business To Be Acquired by Hewlett-Packard Comdisco and 50 Domestic U.S. Subsidiaries File "Fast-Track" Chapter 11 Reorganization Cases and Target Emergence from Chapter 11 in Early 2002 ROSEMONT, Illinois -- July 16, 2001 -- Salomon Smith Barney Inc. and J. P. Morgan Securities Inc. Arrange $600 Million Secured DIP Financing Facility to Support Continued Operations Comdisco's International Subsidiaries Not Part of Chapter 11 Cases; $100 Million of New Secured Facility Reserved for International Subsidiaries To Support Operations in Ordinary Course of Business Company Seeks First Day Orders to Support Employees, Customers and Vendors; Seeks Court-Sanctioned Auction Bidding Procedures for Leasing Business as Part of Strategic Alternatives Assessment Further Cost Savings Measures Announced Comdisco, Inc. (NYSE: CDO) announced today that, as a result of the strategic review commenced in April, it has reached a definitive agreement with Hewlett-Packard Company to sell substantially all of its Availability Solutions (Technology Services) business for $610 million. The sale includes the purchase of assets of Comdisco's U.S. operations and the stock of its subsidiaries in the United Kingdom, France and Canada. The sale excludes the purchase of the stock of subsidiaries in Germany and Spain, as well as other identified assets, including Network Services and IT CAP Solutions. In addition to the sale of its services business, Comdisco is continuing to pursue other strategic alternatives to create value for its stakeholders, including evaluating the possible sale of certain of its leasing assets to several interested buyers. Norm Blake, Chairman and Chief Executive Officer, said: "As a result of our comprehensive strategic review, which we commenced upon my arrival four months ago, we decided that the sale of our technology services business was in the best interest of Comdisco and our stakeholders. We established clear criteria for selecting the most appropriate buyer: expertise and experience in the industry; global presence; a reputation for outstanding customer service; a culture that values people and the development of their employees; and the resources to grow this business. Hewlett-Packard unambiguously fits this criteria." Ann Livermore, President, HP Services, said, "Comdisco has built a strong, profitable business for delivering availability services including backup and contingency planning services and disaster recovery services. Through its industry-leading solutions, talented employees and proven commitment to customer service, the Availability Solutions team has established deep relationships with a large and loyal customer base of more than 3,000 businesses in North America, Europe and Asia." Simultaneous with entering into the Hewlett-Packard transaction, Comdisco announced that the parent company and 50 domestic U.S. subsidiaries have filed voluntary petitions for relief under chapter 11 of the U.S. Bankruptcy Code in the U.S. Bankruptcy Court for the Northern District of Illinois. This filing will allow the company to provide for an orderly sale of these assets, which will be subject to higher or otherwise better bids in a bankruptcy court auction process, while resolving short-term liquidity issues and enabling the company to reorganize on a sound financial basis to support its ongoing businesses. To facilitate the company's ongoing evaluation of its leasing businesses, the company said that it had filed a motion seeking the approval of bidding procedures to conduct a sale auction process for one or more of its leasing business units. The company also announced its intention to reorganize its remaining businesses, including Comdisco Ventures group, on a "fast-track" basis and has targeted emergence from chapter 11 during early 2002. The previously announced discontinued operations of Prism Communication Services are included in the filing and represent approximately 35 of the 51 debtor cases. The company said that Comdisco's operations located outside of the United States are not included in the chapter 11 reorganization cases, and are continuing normal business operations. Comdisco also announced that it had received binding commitments for a $600 million senior secured DIP financing facility led by Citibank, N.A. as Administrative Agent, The Chase Manhattan Bank as Syndication Agent, and Heller Financial, Inc. as Documentation Agent. The $600 million facility, which remains subject to bankruptcy court approval, was arranged by Salomon Smith Barney Inc. and J. P. Morgan Securities Inc. The company said that $100 million of the new secured financing facility has been reserved specifically to support international operations and is expected to be available this week pending interim court approval. "We are gratified by the vote of confidence from such world- class financial institutions in supporting our strategic efforts and vision for maximizing business enterprise value for our stakeholders. This vision includes the thorough assessment and completion of strategic divestitures and the quick reorganization of our remaining business units in order to promptly emerge from chapter 11 early next year," said Mr. Blake. The company said that it had filed 30 first day motions to support its employees, customers and vendors; to obtain interim financing authority and maintain existing cash management programs; to retain legal, financial, real estate and other professionals to support the company's reorganization cases; and for other relief. The company also said that the parent and all of its subsidiaries will conduct normal business operations and continue to make customer service a top priority during the restructuring of its remaining core businesses and the transition process surrounding divested business units. The company will continue to be ready to support Availability Solutions' customers testing programs and recovery needs should they experience a disaster. During the restructuring process, which will facilitate the completion of the Hewlett-Packard transaction and the completion of the company's strategic assessment program, Comdisco's employees will continue to be paid in the normal manner and their health benefits will not be disrupted. Vendors, suppliers and other business partners will be paid under normal terms for goods and services provided during this restructuring period. In accordance with applicable law and court orders, vendors and suppliers who provided goods or services to the U.S.-based companies before today's filing may have prepetition claims, which will be frozen pending court authorization of payment or consummation of a plan of reorganization. In addition, as part of its ongoing cost reduction program, the company announced today a further rationalization of costs to enhance the company's competitive position. Accordingly, Comdisco will reduce its workforce by approximately 200 positions, more than half of which will be at the corporate level. This reduction represents less than 10% of its North American workforce. Mr. Blake said, "We appreciate the continuing support of our customers, lenders and suppliers and the dedication of our employees. Today's court filings are challenging. However, coupled with the Hewlett-Packard transaction, our strategic assessment program and related restructuring steps, they will, in the long term, serve the interests of all of our stakeholders, including our customers, employees and creditors, by making our businesses healthier overall. The filing is the vehicle that enables us to accomplish these objectives." "We intend to proceed quickly with the sale of the technology services business announced today. Additionally, we will continue to evaluate the possibility of selling a significant portion of our leasing assets. At the same time, we will operate Comdisco's other businesses to achieve their full potential. I expect that Comdisco will end its financial restructuring process and exit chapter 11 by the end of the first quarter of the 2002 calendar year," concluded Mr. Blake. The sale agreement is subject to, among other things, higher or otherwise better offers, Court approval, antitrust approval, any other such approvals as may be required by law, and other customary conditions. Given these conditions, there can be no assurance that the proposed transaction will be consummated. About Comdisco Comdisco -- http://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 leasing 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. ----------------------------------------------------------------- [00004] COMDISCO DEBTORS' CHAPTER 11 DATABASE ----------------------------------------------------------------- Lead Debtor: Comdisco, Inc. 611 N. River Road Rosemont, IL 60018 Consolidated Bankruptcy Case No.: 01-24795 Debtor affiliates filing separate chapter 11 petitions: Case No. Debtor Entity -------- ------------- 01-24796 Prism Canada Operationx, LLC 01-24797 Prism Canadaoperations Inc. 01-24798 Comdisco International Holdings, Inc. 01-24799 Prism Oregon Operations, LLC 01-24800 Prism Missouri Operations, LLC 01-24801 Comdisco Equipment Solutions, Inc. 01-24802 Prism Connecticut Operations, LLC 01-24803 Prism Colorado Operations, LLC 01-24804 Prism New Jersey Operations LLC 01-24805 Prism Pennsylvania Operations LLC 01-24806 Comdicso Trade, Inc. 01-24807 Prism DC Operations, LLC 01-24808 Prism New York Operations, LLC 01-24809 Prism Resp Org, LLC 01-24810 Prism Florida Operations, LLC 01-24811 Comdisco Financial Services, Inc. 01-24812 Prism Delaware Operations, LLC 01-24813 Prism North Carolina Operations, LLC 01-24814 Prism Georgia Operations, LLC 01-24815 Prism Rhode Island Operations, LLC 01-24816 Prism Illinois Operations, LLC 01-24817 Comdisco Investment Group, Inc. 01-24818 Prism Ohio Operations, LLC 01-24819 Prism Investments, Inc. 01-24820 Prism Indiana Operations, LLC 01-24821 Prism Texas Operations, LLC 01-24822 Comdisco Healthcare Group, Inc. 01-24823 Prism Operations, LLC 01-24824 Prism Kentucky Operations, LLC 01-24825 Prism Virginia Operations, LLC 01-24826 Prism Kansas Operations, LLC 01-24827 Prism Washington Operations, LLC 01-24828 Comdisco Medical Exchange, Inc. 01-24829 Prism Leasing, LLC 01-24830 Prism Communication Services, Inc. (95.5%) 01-24831 Prism Maryland Operations, LLC 01-24832 Prism Management Services, LLC 01-24833 Prism Wisconsin Operations, LLC 01-24834 Comdisco Labs, Inc. 01-24835 Prism Michigan Operations, LLC 01-24836 Prism Arizona Operations, LLC 01-24837 Prism California Operations, LLC 01-24838 CDC Realty, Inc. 01-24839 Prism Massachusetts Operations, LLC 01-24840 Prism Minnesota Operations, LLC 01-24841 Hybrid Venture Partners, L.P. 01-24842 Rosemont Venture Management I, LLC 01-24843 CDS Foreign Holdings, Inc. 01-24844 Rosemont Equities, LLC 01-24845 Computer Discount Corporation Chapter 11 Petition Date: July 16, 2001 Court: United States Bankruptcy Court Northern District of Illinois Eastern Division 219 South Dearborn Chicago, IL 60604 Telephone (312) 435-5694 Judge: The Honorable Ronald Barliant Debtors' Lead Counsel: John Wm. "Jack" Butler, Jr., Esq. Charles W. Mulaney, Esq. George N. Panagakis, Esq. Gary P. Cullen, Esq. N. Lynn Heistand, Esq. Seth E. Jacobson, Esq. Andre LeDuc, Esq. Christina M. Tchen, Esq. L. Byron Vance, III, Esq. Marian P. Wexler, Esq. Felicia Gerber Perlman, Esq. Skadden, Arps, Slate, Meagher & Flom, LLP 333 West Wacker Drive Chicago, IL 60606 (312) 407-0700 Debtors' International Counsel: Evan D. Flaschen, Esq. Anthony J. Smits, Esq. Bingham Dana LLP One State Street Hartford, CT 06103 Debtors' Special Counsel: David N. Missner, Esq. Piper, Marbury, Rudnick & Wolfe 203 N. LaSalle St., Suite 1800 Chicago, IL 60601-1293 and Mark Muedeking, Esq. Piper, Marbury, Rudnick & Wolfe 6225 Smith Avenue Baltimore, MD 21209 Debtors' Financial Advisors: Michael P. Esposito Vlad Gutin Goldman, Sachs & Co. 85 Broad Street New York, NY 10004 Chip W. Hardt Greg Besio Scott Bils Pepe Cafferata Scott Ordway Rajesh Kurnar Avnish Sabharwal McKinsey & Company, Inc. 21 South Clark St., Suite 2900 Chicago, IL 60603-2900 Thomas Allison Jerry L. Turner Arthur Andersen LLP 33 West Monroe Street Chicago, IL 60603-5385 Debtors' Real Estate Advisor: Michael P. Deighan Rockwood/Gemini Advisors, LLC 555 Fifth Avenue New York, NY 10017-2416 United States Trustee: Ira Bodenstein Sandra Rasnak Roman L. Sukley Office of the United States Trustee 227 West Monroe Street, Suite 3350 Chicago, IL 60606 Telephone (312) 886-5785 Fax (312) 886-5794 Claims Agent: Kathleen M. Logan Logan & Company, Inc. 546 Valley Road Upper Montclair, NJ 07043 ----------------------------------------------------------------- [00005] LIST OF THE LARGEST HOLDERS OF COMDISCO BANK DEBT ----------------------------------------------------------------- Entity Nature Of Claim Claim Amount ------ --------------- ------------ Bank of America NA Loan $88,950,000 Wes Oldham 1850 Gateway Blvd. Concord, CA 94520-3282 Phone: 925-675-8409 Fax: 945-969-2837 Royal Bank of Scotland Loan $72,550,000 David Apps 101 Park Avenue, 10th Floor New York, NY 10178-1199 Phone: 212-401-3756 Fax: 212-401-3456 Citicorp Securities, Inc. Loan $71,140,00 Timothy Smith 500 West Madison Street 7th Floor Chicago, IL 60661 Phone: 312-627-3970 Fax: 312-627-3990 Banc One Capital Markets Loan $62,680,000 John Coons 1 BAnk Plaza - M Stop 0084 Chicago, IL 60661 Phone: 312-732-3953 Fax: 312-732-6222 Credit Lyonnais Loan $61,820,000 Mary Ann Klemm 227 West Monroe Street Chicago, IL 60606 Phone: 312-220-7308 Fax: 312-641-0527 Deutsche Bank Securities Loan $51,820,000 David Wagstaff 31 West 52nd Street New York, NY 10019 Phone: 212-469-8902 Fax: 212-0469-8212 UBS Warburg LLC Loan $51,820,000 Mike Hynes 677 Washington Stamford, CT 06901 Phone: 203-719-1088 Fax: 202-719-0495 Industrial Bank of Japan Loan $45,640,000 David Giddy IBJ Ltd., NY 227 West Monroe Street Chicago, IL 60606 Phone: 312-855-8482 Fax: 312-855-8481 Barclays PLC Loan $39,730,000 Keith Mackie 222 Broadway, 8th Floor New York, NY 10038 Phone: 212-412-7518 Fax: 212-412-7585 Nord/LB Loan $39,730,000 George Peters 1114 Avenue of the Americas New York, NY 10036 Phone: 212-812-6993 Fax: 212-812-6860 CIBC World Markets Loan $32,680,000 Dominick Sorresso 425 Lexington Avenue New York, NY 10016 Phone: 212-856-4133 Fax: 212-856-3991 Bayerische LB Loan $31,090,000 James Fox 560 Lexington Avenue New York, NY 10022 Phone: 212-310-9986 Fax: 212-310-9868 Den Danske Loan $31,090,000 Peter Hargraves 280 Park Avenue 4th Floor, E. Bldg. New York, NY 10017 Phone: 212-984-8433 Fax: 212-370-9239 West Deutsche LB Loan $31,090,000 Klaus Neunning 233 South Wacker Drive Suite 5210 Chicago, IL 60606 Phone: 312-930-9200 Fax: 312-930-9281 ----------------------------------------------------------------- [00006] LIST OF THE LARGEST REGISTERED COMDISCO BONDHOLDERS ----------------------------------------------------------------- Entity Nature Of Claim Claim Amount ------ --------------- ------------ Chase Manhattan Bank Notes $387,409,000 Orma Trim 4 New York Plaza New York, NY 10004 Phone: 212-623-6174 Fax: 212-623-4691 The Bank of New York Notes $273,044,000 Cecile Lamarco 925 Patterson Plank Road Secaucus, NJ 07094 Phone: 201-319-3066 Fax: 201-319-3073 State Street Bank and Notes $223,692,000 Trust Company Joseph Callahan 1776 Heritage Drive, NO Quincy, MA 02170 Phone: 617-985-6453 Fax: 617-537-5004 Bankers Trust Company Notes $143,420,000 John Lasher 648 Grassmere Park Road Nashville, Tennessee 37211 Phone: 615-835-3419 Fax: 615-835-3409 Citibank, N.A. Notes $140,808,000 David Leslie 3800 Citicorp Centers Tampa Tampa, FL 33610-9122 Phone: 813-604-1193 Fax: 813-604-1155 Boston Safe Deposit and Notes $131,258,000 Trust Company Constance Holloway C/o Mellon Bank Center Room 153-3015 Houston, TX, 77252-8009 Phone: 412-234-2929 Fax: 412-234-7244 Salomon Smith Barney, Inc. Notes $128,737,000 Pat Haller 333 W. 34th Street New York, NY 10001 Phone: 212-615-9212 Fax: 212-615-9053 Bear, Stearns Securities Notes $88,803,080 Corp. Vincent Marzwlla One Metrotech Center North 4th Floor Brooklyn, NY 11201-3862 Phone: 212-272-0302 Fax: 212-272-0316 Chase Bank of Texas, N.A. Notes $84,420,000 Debbie Lorenzo PO Box 2558 Houston, TX 77252 Phone: 713-216-4488 Fax: 713-216-6931 The Northern Trust Company Notes $77,728,200 Jarvis Mckee 801 S. Canal C-In Chicago, IL 60607 Phone: 312-630-1858 Fax: 312-444-3882 Prudential Securities Notes $63,575,000 Custody Issuer Services C/o ADP Proxy Services 51 Mercedes Way Edgewood, NY 11717 Phone: 516-254-7400 Fax: 516-254-7418 Salomon Smith Barney, Inc./ Notes $54,553,000 Salomon Brothers Patricia Haller 222 W 34th Street, 3rd Floor New York, NY 10001 Phone: 212-615-9212 Fax: 212-615-9053 Morgan Stanley & Co. Notes $50,577,000 Incorporated Victor Reich One Pierrepont Plaza 7th Floor Brooklyn, NY 11202 Phone: 718-754-4019 Fax: 718-754-4291 Merrill Lynch Pierce Notes $49,542,000 Fenner & Smith Safekeeping Veronica O'Neill 4 Corporate Place Piscataway, NY 08854 Phone: 201-557-2620 Fax: 201-254-7750 Brown Brothers Harriman Notes $41,920,000 & Co. Robert Davide 63 Wall Street, 8th Floor New York, NY 10004 Phone: 212-493-7946 Fax: 212-493-5559 First Union National Bank Notes $32,625,000 Diane Gallagher 123 South Broad Street Philadelphia, PA 19101 Phone: 215-670-4314 Fax: 215-670-4705 ----------------------------------------------------------------- [00007] LIST OF COMDISCO'S LARGEST TRADE CREDITORS ----------------------------------------------------------------- Entity Nature Of Claim Claim Amount ------ --------------- ------------ Cisco Systems Inc. Trade $4,115,749 Rajshi Sidher 170 West Tasman Drive San Jose CA 95134-1706 Phone: 408-853-9744 Fax: 408-526-5450 Solectron Trade $3,504,457 Myron Lee 847 Gibraltar Drive Building 5 Milipitas, CA 95035 Phone: 408-956-6573 Nortel Network, Inc. Trade $2,535,503 Pam Mitchell, Credit 1100 Technology Park Drive Billerica, MA 01821-5501 Phone: 978-288-7533 Fax: 978-288-4128 IBM Trade $1,437,107 Luc Gernon Northcastle Drive Mail Drop 317 Armonk, NY 10504 Phone: 914-765-6250 Fax: 914-765-6276 EMC Corp. Trade $1,216,992 Susan Norling Hopkinton, MA 01748-9103 Phone: 508-435-1000 Fax: 508-435-8075 Globitech Trade $1,027,428 Terry Kluesner 1414 West Houston Street Shenman, TX 75092 Phone: 903-870-0314 Fax: 903-870-0625 T Networks Inc. Trade $834,708 Tom Anderson 6580 Snowdrift Allentown, GA 18109 Phone: 610-266-1778 Fax: 610-289-5050 Motorola Trade $738,479 Mike Kuvlesky 3501 Ed Bluestein Blvd. Austin, TX 78721 Phone: 512-933-5891 Fax: 512-933-3407 LightConnect Inc. Trade $493,270 Scott Jensen 35445 Dumbarton Court Newark, CA 94560 Phone: 510-713-6553 Fax: 510-713-3119 Cetacean Networks Trade $320,924 Paul Barkworth 100 Arboretu Drive Suite 301 Newington, NH 30801 Phone: 603-766-6112 Fax: 603-766-6190 Walkabout Computers Inc. Trade $311,750 Renee Gibson 1502 Northpoint Parkway Ste. 103 West Palm Beach, Florida 33407 Phone: 561-881-9050 x 208 Fax: 561-881-7354 Beckman Coulter Inc. Trade $289,592 Riad Abuelafiah 4300 North Harbor Boulevard Fullerton, CA 92834 Phone: 714-871-4848 Fax:714-773-7620 Hewlett Packard Co. Trade $280,996 Debbie Burton Phone: 404-648-7223 Western Digital Trade $280,827 Marilyn Sauriched 8105 Irvine Centre Drive Irvine, CA 92713-9665 Phone: 949-932-5885 SOS Security Trade $201,863 915 Route 46 East Parsippany, NJ 07054 ----------------------------------------------------------------- [00008] LIST OF PRISM COMMUNICATION'S LARGEST UNSECURED CREDITORS ----------------------------------------------------------------- Entity Nature Of Claim Claim Amount ------ --------------- ------------ Verizon Trade $30,000,000 Jeannine Kirkman 125 High Street Boston, MA 02110 Phone: 617-743-6400 Fax: 617-439-7870 SBC Trade $16,000,000 Barbara Toivenen Four Bell Plaza, 7th Floor 311 S. Akard St. Dallas, TX 75202-5398 Phone: 214-464-7768 Fax: 214-464-1486 Canon Trade $500,000 Andrew Sklar (counsel, Sklar & Paul) 2201 Route 38, Suite 100 Cherry Hill, NJ 08002 Phone: 856-482-7900 Fax: 856-482-8060 Electric Lightwave Trade $470,860 Sandra Wyzanowski 4400 NE 77th Ave. Vancouver, WA 98662 Phone: 360-816-4187 Fax: 360-816-4175 Illuminet Trade $364,934 Scott Schumacher 4501 Intelco Loop SE PO Box 2909 Olympia, WA 98507 Phone: 360-493-6000 Fax: 360-493-6253 AT&T Trade $302,744 Sophia Paup 901 Marquette Ave. Suite 500 Minneapolis, MN 55402 Phone: 612-376-6582 Fax: 800-547-1333 MCI Worldcom Trade $235,562 Idea Integration Trade $163,805 Cincinnati Bell Trade $130,795 Pitney Bowes Trade $100,000 Verizon Wireless Trade $73,378 Lexicom Trade $37,500 Arch Wireless Trade $12,783 Accountants on Call Trade $8,905 Research in Motion Trade $6,859 CT Corporation Trade $5,542 Logical Trade $4,934 Qwest Trade $4,903 The Wood Company Trade $4,386 William Mercer Trade $4,341 ----------------------------------------------------------------- [00009] HP ANNOUNCES PACT TO ACQUIRE TECHNOLOGY SERVICES BUSINESS ----------------------------------------------------------------- PALO ALTO, California -- July 16, 2001 -- Hewlett-Packard Company (NYSE:HWP) today announced that it has signed a definitive agreement with Comdisco, Inc. to acquire substantially all of Comdisco's Availability Solutions (Technology Services) business for $610 million in cash, subject to certain closing adjustments. The units included in the agreement provide business continuity and complementary consulting services for mission- critical environments. They employ more than 1,300 employees worldwide and generated approximately $440 million in revenues during Comdisco's fiscal year 2000, ended Sept. 30. Separately today, Comdisco announced that its parent company and 50 of its U.S. domestic subsidiaries have filed voluntary petitions for relief under chapter 11 of the U.S. Bankruptcy Code in the U.S. Bankruptcy Court for the Northern District of Illinois. Comdisco's operations outside of the U.S. are not included in the filing. The agreement between the two companies is subject to the bankruptcy sales process and bankruptcy court and regulatory approvals. Under the terms of the transaction, which is expected to close in HP's fourth fiscal quarter, ending Oct. 31, 2001, HP will assume certain, limited liabilities. The transaction is expected to be accretive to HP's cash earnings per share in its fiscal year 2002. Comdisco's business continuity and professional services focus, core competencies and strong customer base in Fortune 500 and financial services companies are highly complementary to HP Services' current capabilities. With this acquisition, HP expects to become the leading provider of business continuity services worldwide, able to deliver clients an integrated offering that helps them ensure the continuity of both their business processes and their underlying information technology infrastructure. "The acquisition of these Comdisco availability services businesses presents a compelling opportunity for HP and is consistent with our focus on building a premier global services capability," said Ann Livermore, president, HP Services. "Comdisco has built a strong, profitable business for delivering availability services including backup and contingency planning services and disaster recovery services." Livermore continued, "Through its industry-leading solutions, talented employees and proven commitment to customer service, the Availability Solutions team has established deep relationships with a large and loyal customer base of more than 3,000 businesses in North America, Europe and Asia. HP has strong momentum in our services business. We are confident that the addition of the Comdisco business continuity and complementary consulting services businesses will further enhance our ability to deliver solutions for an always-on Internet infrastructure to customers worldwide." Norm Blake, chairman and chief executive officer, Comdisco, said: "As a result of our comprehensive strategic review, which we commenced upon my arrival four months ago, we decided that the sale of our technology services business was in the best interest of Comdisco and our stakeholders. We established clear criteria for selecting the most appropriate buyer: expertise and experience in the industry; global presence; a reputation for outstanding customer service; a culture that values people and the development of their employees; and the resources to grow this business. Hewlett-Packard unambiguously fits this criteria." More information on HP's Services business and memos from Ann Livermore to employees and customers of Comdisco's availability services business are posted on the HP Services Web site, http://www.hp.com/hps/announce.htm HP expects to integrate the Comdisco continuity and professional services businesses within its HP Operations organization, which is part of HP Services. HP has a particularly strong business continuity services presence in Europe and significant expertise in the manufacturing, telecommunications and service provider market segments. About HP Hewlett-Packard Company -- a leading global provider of computing and imaging solutions and services -- is focused on making technology and its benefits accessible to all. HP had total revenue from continuing operations of $48.8 billion in its 2000 fiscal year. Information about HP and its products can be found on the World Wide Web at http://www.hp.com *** End of Issue No. 1 ***