Evolving from a local bicycle messenger service in 1907 to a global provider of package delivery and supply chain services today, UPS is committed to helping small businesses grow by offering a superior set of package delivery, supply chain, and financial services. From financial services to technology integrations and from logistics to package delivery, UPS tailors its services to help small businesses operate more effectively and efficiently - whether they plan to stay small or go big.

UPS Capital, the financial services arm of UPS created in 1998, helps small businesses accelerate the movement of money through their supply chains. From protecting companies against the various risks associated with global trade to assisting businesses with expansion into new markets, UPS Capital reviews customer needs and provides financial solutions customized for the individual requirements of today's small business.

Commercial Loans: UPS Capital provides a number of commercial lending options for small businesses, primarily through its subsidiary, UPS Capital Business Credit. From commercial mortgages to commercial term loans to government-guaranteed loan programs, UPS Capital Business Credit helps small businesses gain access to capital so they can grow. Government-guaranteed lending is one area in which UPS Capital Business Credit specializes:

• UPS Capital Business Credit is a robust participant in the U.S. Small Business Administration's (SBA) Preferred Lender Program (PLP), which enables participating lenders to drastically reduce the amount of time it takes to approve SBA 7(a) loans for small businesses from weeks to just days. Under the SBA program, a business can apply for a SBA loan of US$250,000 to US$4 million, and benefit from SBA loan advantages such as longer terms, no points and no balloon payment. UPS Capital Business Credit is a PLP participant in the SBA's 75 districts covering all of the contiguous United States and has consistently been a leading lender in the SBA's 7(a) loan program and, for fiscal year 2004, closed 69 SBA transactions valued at US$47 million.
• UPS Capital Business Credit for four consecutive years has been ranked as a top lender in the U.S. Department of Agriculture's (USDA) Business & Industry loan program in terms of dollar value of transactions. In 2004 UPS Capital Business Credit closed 7 USDA transactions valued at US$23.6 million.
• UPS Capital Business Credit is a leading Export-Import Bank of the United States (Ex-Im Bank) lender in terms of number of transactions. For fiscal 2004, UPS Capital Business Credit closed 47 Ex-Im Bank transactions valued at US$43.2 million.

Cash Flow Enhancement Services: Helping small businesses accelerate the movement of funds through their supply chains lies at the core of the UPS Capital mission. UPS Capital delivers a number of solutions that help companies accelerate cash flow while mitigating the risks of non-payment:

• UPS Capital's C.O.D. enhancement services¹ help to streamline the traditional C.O.D. process and can assist in delivering cost savings and processing efficiencies that improve cash flow through the expedited electronic transfer of funds. Utilizing a traditional C.O.D. arrangement, it can take anywhere from 12 to 14 days for funds associated with a check accepted by a UPS driver upon package delivery to be deposited into an account. Using one of the UPS Capital C.O.D. programs, funds can be automatically transferred into a designated bank account generally within two or three days after UPS package delivery, saving the business the time and expense of processing each C.O.D. check.
• The UPS Capital Visa® Platinum Business Credit Card², for certain qualified and approved applicants, can offer a small business flexible lines of credit, discount rewards on UPS services, and reporting which can assist in separating business and personal expenses for accounting and tax purposes.

In addition, UPS offers Exchange Collect, a fast, secure payment alternative for financial settlement of international trade. This service minimizes the cost and complexity involved with letters of credit, documentary collections, or third-party service.

Insurance³: UPS Capital Insurance Agency, Inc. and its licensed affiliates can assist in providing a number of insurance solutions that help businesses mitigate certain payment risks associated with global trade, as well as protect against the risk of loss associated with freight shipments, the shipment of high-value or perishable goods and time-sensitive shipments.

• Flexible Parcel Insurance is an expanded parcel coverage option designed to protect against the risk of loss associated with the shipment of high-value or perishable goods and time-sensitive shipments.
• Credit Insurance is a valuable tool used to protect against the risk of non-payment for both domestic and international sales.
• Cargo Insurance helps to mitigate the risk of loss for shipments of goods while in transit.

Customer Examples:

• Atlanta Bread Company - UPS Capital provided this bakery café franchisor with US$1.8 million in financing of equipment for the company's commissary in Atlanta , which serves more than 165 bakery cafés in 26 states. By selecting UPS for air express and ground package deliveries, Atlanta Bread Company has enjoyed a significant reduction in the time required to process its shipments.
• Falcon Solutions - The Roswell, Ga.-based Falcon, a supplier of high-tech and electronic components to original equipment and contract manufacturers, utilizes UPS Capital's C.O.D. Automatic program to assist in accelerating its cash flow. With the C.O.D. Automatic program, C.O.D. funds are generally available within two to three days after package delivery. Additionally credit insurance, provided through UPS Capital Insurance Agency, Inc. helps to mitigate the risk of non-payment for Falcon Solutions' open accounts receivable.
• Toynk.com - UPS Capital Business Credit helped this Chicago-based toy e-tailer by providing a five-year US$200,000 loan, supported by a U.S. Small Business Administration guarantee, and a one-year US$50,000 secured line of credit so the company can purchase more inventory for its online toy retail site. Additionally, UPS Supply Chain Solutions is providing international transportation management and customs clearance for the new inventory shipped from Asia to the United States via air and ocean. UPS also is providing package delivery and integrating UPS package tracking tools into the Toynk.com Web site.

¹C.O.D. Automatic and C.O.D. Secure ("C.O.D. Enhancement Services") are offered through UPS Capital Trade Protection Services, Inc. UPS Capital Corporation and its affiliates reserve the right to change or cancel the C.O.D. Enhancement Services program at any time. The C.O.D. Enhancement Services programs are governed by the terms and conditions of the contract and certain limitations and exclusions apply. The information contained in this letter does not in any way alter, supplement, or amend the provisions of the applicable contract and is intended only as a brief summary of the program. The UPS C.O.D. charge as set forth in the UPS rates in effect at the time of shipping apply to each UPS C.O.D. package shipped. C.O.D. Enhancement Services products may not be available in all jurisdictions.

²The UPS Capital Visa ® Platinum Business Card is offered and issued by BancOne Delaware, N.A. ("BankOne") and is subject to BankOne's terms and conditions. All cards are subject to underwriting and credit approval by BankOne. The terms and conditions of any card are subject to BankOne's Cardmember Agreement. The UPS Capital Visa® Platinum Business Card is available only in the U.S.

³Insurance programs are offered through UPS Capital Insurance Agency, Inc. and through the following licensed agency affiliates: UPS Capital Insurance Agency, Inc. of California in California, UPS Capital Insurance Agency, Inc. of Massachusetts in Massachusetts and UPS Capital Insurance Agency, Inc. of Nevada in Nevada and Louisiana. UPS Capital Insurance Agency, Inc. reserves the right to change or cancel insurance programs at any time. Insurance programs are governed by the terms, conditions, limitations and exclusions set forth in the applicable insurance policy issued by the respective insurance carrier. The above information does not in any way alter, supplement, or amend the provisions of the applicable insurance policy and is intended only as a brief summary of the program. The insurance programs described herein are not available in all jurisdictions.

UPS Capital loans are made in California pursuant a Department of Corporations California Finance Lenders License. Government guaranteed loans are offered through UPS Capital Business Credit, a subsidiary of UPS Capital Corporation. UPS Capital Corporation is neither an agent for, nor associate of, UPS Capital Business Credit for the purposes of originating, processing, underwriting or servicing government guaranteed loans (e.g., SBA, USDA or Ex-Im guaranteed loans). Products may not be available in all areas and may be modified based on requirements. Check with your UPS Capital or UPS Capital Business Credit representative for local availability. Credit availability is subject to approval.

For more information, contact:

Laurie Mallis
UPS
404-828-7183