Exclusive Interview
with Gary H. Souverein, Pawnee Leasing

By Kit Menkin

Pawnee Leasing Corporation, Fort Collins, Colorado, established in 1982, is a very well respected and well-known small-ticket funding source specializing in start-up business and less traditional credits up to $30,000. Today they have 45 employees and work primarily with brokers who have been in business for only a year ( many are well established for over twenty-five years.) Their rates are high and terms tough, but they have a growing niche in the marketplace as their success has indicated. They know what they are doing.

While I was on vacation, the following press release was issued:

In June, 2005 Gary H. Souverein, who has been with the company since 1993, was elevated from executive vice-president to president and COO. Perhaps there was purpose in this move as cars4U “merger” includes Pawnee's senior management team will continue on their roles with Pawnee. In addition, Rob Day and Sam Leeper, Pawnee's Chairman and founder, and CEO respectively, will be among the trustees for the income fund.

“This is not a current event for Pawnee," he explained. "We've been engaged in discussions and subsequent due diligence with cars4U for several months. I can tell you due diligence can be a distraction to running any business, but we enjoy demonstrating our well disciplined business operations. We are very proud of the systems and results we've created at Pawnee.”

“We were not seeking an opportunity like this; in fact just weeks earlier to our introduction to cars4U we had completed a significant financing facility with JPMorgan Chase... Our business was well positioned for our growth plans. Ours was not a situation motivated by some deficiency in our business. We have been exceptionally fortunate to have a stable record of success in every year of our company history.”

Here are more specifics from Gary Souverein :

“On October 24 Pawnee entered into an agreement with cars4U to be acquired concurrent with our two firms completing an IPO...and conversion to an income trust/fund. Pending a successful IPO the purchase price would be $57.9 million. Under the terms of the purchase agreement, $44.4 million will be payable in cash at closing with the balance--- satisfied through the issuance of securities, which are directly or indirectly exchangeable for units of the income trust/fund.”

"Canada's public marketplace is much smaller, but it is very dynamic... income trusts specifically make up over $160 billion of market capitalization. This is an important opportunity for us, to leverage the public capital markets.

cars4U appears to be impressed with the overall operation, particularly the earnings performance in Pawnee's marketplace. This is not a portfolio purchase, more an investment. Souverein appears excited about the opportunities to come.

“In the coming months, we should be successful in our IPO effort, “ he said. He believes while the cultures of both are different, they both have the same mission.

“It centers on our shareholders, employees and customers, “ he explained. “Every aspect of our business and 100% of our employee and management team remains as is.

“I can emphasize to you and your readers we intend to continue to deliver and focus our corporate mission to the broker community.

We will continue to underwrite small-ticket start-up and less traditional credits, like we have been doing since we started in 1982.

If you would like to offer support to Gary, encouragement, here is his address:

Gary H. Souverein
President & COO
Pawnee Leasing Corporation
700 Centre Avenue
Fort Collins, CO 80526
(800) 864-4266 ext. 222
(970) 482-2666 (Fax)