Compaq Financial Services Announces
Technology Financing for Government,
Education and Medical Customers
EduFlex & ITFlex Programs Simplify Technology Acquisition
WOODBRIDGE, N.J., Dec. 6 /PRNewswire/ -- Compaq Financial Services Corporation (CFS), the
in-house financing unit of Compaq Computer Corporation (NYSE: CPQ - news), today announced that it
has expanded its offerings to address the needs of the government, education and medical markets,
extending to U. S. public sector customers the convenience of one-stop shopping for all their equipment
and financing requirements.
The comprehensive CFS leasing and financing programs -- EduFlex for K-12 and higher educational
institutions, and ITFlex for state and local government agencies -- give Compaq customers new options
and greater flexibility for acquiring the latest information technology quickly without purchasing it
outright.
''The EduFlex and ITFlex financing programs make state-of-the-art technology immediately affordable
and accessible, while minimizing the obsolescence factor,'' said Irving H. Rothman, president and CEO
of Compaq Financial Services. ''In partnership with our parent company, we provide public sector
customers an unbeatable combination of integrated offerings that include the latest technology,
comprehensive financing and asset management programs, and top-notch service and support -- all from
a single source.
''These customized public sector financing programs are a natural extension of our growing leasing and
financing capabilities,'' he added. ''Compaq Financial Services now offers an almost unmatched array of
equipment leasing and financing alternatives for the full range of Compaq customers -- from consumers
and small businesses on up to large, multinational corporations -- and now public sector customers as
well.''
Don Weatherson, vice president, government, education and medical, for Compaq Computer
Corporation, said, ''We're excited about the opportunity to present one Compaq face to our public
sector customers with these innovative CFS leasing and financing programs. We have jointly developed
these new strategies, working closely with our dedicated, in-house financing resource, and we believe
they add considerable value for organizations that want to acquire the latest Compaq technology and
keep it current.''
Previously, Compaq's public sector customers were supported by third-party financing providers.
The EduFlex and ITFlex financing programs from CFS enable customers to acquire the technology they
need for an affordable, low monthly payment. The programs simplify the technology acquisition process
for government agencies and educational institutions by providing flexible terms and payment structures
that match the useful life of the equipment.
With up to 100-percent financing available from Compaq Financial Services, there is no capital outlay
and no security deposit, and the fixed monthly payments are funded from already-approved operating
budgets. This type of financing solution thus can be a viable alternative to potentially costly and
time-consuming long-term capital financing -- a process that typically requires a separate voter
referendum.
Some EduFlex and ITFlex offerings also enable customers to refresh their equipment prior to the end of
the lease, which ensures that customers always have access to the right technology. At the end of the
lease term, they can simply return the equipment to Compaq -- no more disposal issues or need for
surplus property bids.
In addition, Compaq Financial Services will finance other associated costs, including software,
installation, training, prepaid maintenance, and wiring, together with such peripheral products as other
manufacturers' audio- visual equipment and communications systems.
About Compaq
Compaq Computer Corporation, a Fortune Global 100 company, is the second- largest computer
company in the world and the largest global supplier of computer systems. Compaq develops and
markets hardware, software, solutions and services, including industry-leading enterprise computing
solutions, fault-tolerant business-critical solutions, enterprise and network storage solutions,
commercial desktop and portable products and consumer PCs. The company is an industry leader in
environmentally friendly programs and business practices.
Compaq products are sold and supported in more than 100 countries through a network of authorized
Compaq marketing partners. Customer support and information about Compaq and its products are
available at compaq.com.
About Compaq Financial Services
Compaq Financial Services Corporation is a wholly owned subsidiary of Compaq Computer Corporation.
In January 1997, Compaq established Compaq Financial Services as its in-house equipment leasing
and financing unit with the strategic objective of financing technology solutions for Compaq customers
around the world. Compaq Financial Services serves all of Compaq's customers from consumers and
small and mid-sized businesses to government agencies, educational institutions and large,
multinational corporations. Typical transactions range from $500 to $100 million. Information on the full
range of financing and leasing programs from Compaq Financial Services is available at
compaq.com.
COMPAQ FINANCIAL SERVICES
Government, Education and Medical Fact Sheet
Funding information technology and the associated soft costs, such as software, maintenance,
installation, training, etc., presents the public sector with several challenges.
First, government entities face the risk that technology becomes obsolete quickly. Second, technology
assets are usually treated as a capital expense. The conventional funding method of issuing bonds to
finance the capital acquisition is cumbersome and inflexible. For example, bonds are generally issued
with a life span of 15 years or more, which does not match the typical three- to four-year life of
technology assets.
In addition, a bond issue requires voter approval. This often delays or negates the opportunity to take
advantage of the efficiencies effected by an improved technological platform. In the specific case of
schools and other educational institutions, delay impedes the learning ability of our nation's future
workforce.
An Alternative to Traditional Funding
Leasing, a financing method typically used in the commercial market or the private sector, is gaining
acceptance among administrators as a cost-effective and practical approach for financing technology
assets. In contrast to bonds, which involve a lengthy approval process, leases are more easily approved
and payments are made from operating funds. The low-cost, fixed-payment plan that is the hallmark of
leasing, stretches the available budget and allows a governmental or educational entity to broaden the
scope and quality of its technology infrastructure.
Flexibility
Lease financing is inherently flexible. Terms and payment structures can be customized to meet a
specific need with transactions ranging in size from as little as $1,000 to many millions of dollars.
Leasing also minimizes the effects of technological obsolescence by allowing the lessee to upgrade or
refresh the equipment during the lease term. Importantly, since a governmental or educational entity is
not the owner of the equipment, refreshing the technology does not create any surplus property to be
disposed of. Public sector customers can choose from three primary lease-finance options:
Tax-Exempt Installment Sale -- a cost-effective path to long-term ownership;
Tech Refresh Lease -- a built-in ability to upgrade easily; and
Fair Market Value/True Lease -- low payments with flexible end-of-term options.
Ease of Use
The lease application process is streamlined. For transactions under $250,000, entities need to
complete a one-page lease application and Compaq Financial Services guarantees a response in one
business day.
Benefits of Leasing with Compaq Financial Services
-- One-stop shopping -- one complete source for all of a customer's
information technology and financing needs.
-- A world-class computer company that understands customer needs and can
provide support over the life of the installation.
-- An affordable alternative to potentially costly and time-consuming
voter referendums.
-- 100-percent financing, which enables public sector customers to
conserve capital budget resources and afford more equipment.
-- Easy upgrades, which help avoid technology obsolescence.
-- Safe and easy equipment disposal -- no more surplus property issues.
-- A streamlined application and approval process. It's easy --
customers complete our one-page lease application and leave the rest
to us.
About Compaq Financial Services
Founded in January 1997 as a wholly owned subsidiary of Compaq Computer Corporation, Compaq
Financial Services Corporation now offers an array of leasing and financing products that is almost
unmatched in the equipment leasing industry. With the convenient, flexible financing options available
from Compaq Financial Services, Compaq Computer provides customers with a single source for all of
their technology acquisition, servicing and financing needs. Based in Woodbridge, New Jersey, Compaq
Financial Services serves all of Compaq's customers, from consumers and small to mid-sized
businesses to government agencies, educational institutions and large, multinational corporations,
handling transactions that range in size from $500 to $100 million.
SOURCE: Compaq Computer Corporation
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