<PAGE>
COMDISCO RETIREMENT PLAN
FINANCIAL STATEMENTS
Years Ended September 30, 1999 and 1998
<PAGE>
TABLE OF CONTENTS
Page
Number
------
INDEPENDENT AUDITOR'S REPORT 1
FINANCIAL STATEMENTS
Statements of Net Assets Available for
Benefits - September 30, 1999 and 1998 2
Statement of Changes in Net Assets
Available for Benefits, with Fund
Information - Year Ended September 30, 1999 3-4
Statement of Changes in Net Assets
Available for Benefits, with Fund
Information - Year Ended September 30, 1998 5-8
Notes to Financial Statements 9-16
INDEPENDENT AUDITOR'S REPORT ON
SUPPLEMENTARY INFORMATION 17
SUPPLEMENTARY INFORMATION
Schedule of Assets Held for Investment
Purposes - September 30, 1999 18
Schedule of Assets Held for Investment
Purposes - September 30, 1998 19
Schedule of Assets Held for Investment
Purposes Which Were Both Acquired and
Disposed Within the Plan Year - Year
Ended September 30, 1998 20
<PAGE>
(David J. Miller & Associates, LLP Letterhead)
INDEPENDENT AUDITOR'S REPORT
To the Trustees of the
Comdisco Retirement Plan
We have audited the accompanying statements of net assets available for benefits
of the Comdisco Retirement Plan as of September 30, 1999 and 1998 and the
related statements of changes in net assets available for benefits, with fund
information for the years then ended. These financial statement are the
responsibility of the Plan's management. Our responsibility is to express an
opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the net assets available for benefits of the Plan as of
September 30, 1999 and 1998, and the changes in net assets available for
benefits, with fund information for the years then ended in conformity with
generally accepted accounting principles.
/s/ David J. Miller & Associates, LLP
Deerfield, Illinois
January 21, 2000
<PAGE>
COMDISCO RETIREMENT PLAN STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
September 30, 1999 and 1998
<TABLE>
1999 1998
---------- -----------------------------------------
Non
Participant Participant Participant
Directed Directed Directed Total
------------ ----------- ------------ ------------
<S> <C> <C> <C> <C>
Assets
Investments
Employer securities
Comdisco common stock ....................... $ 21,839,252 $ 12,235,026 $ -- $ 12,235,026
Comdisco common stock (transferred from ESOP) 58,985,319 -- -- --
Registered investment companies
Putnam International Growth ................. 11,147,679 7,291,804 -- 7,291,804
The George Putnam Fund of Boston ............ 4,983,752 4,531,999 -- 4,531,999
The Putnam Fund for Growth and Income ....... 12,750,509 11,302,703 -- 11,302,703
Putnam Income ............................... 4,820,633 5,665,292 -- 5,665,292
Putnam Vista ................................ 21,093,256 16,392,081 -- 16,392,081
T. Rowe Price Small Cap Value ............... 4,029,230 3,658,496 -- 3,658,496
T. Rowe Price Equity Income ................. 10,672,522 10,792,465 -- 10,792,465
T. Rowe Price Equity Index .................. 17,911,209 9,297,475 -- 9,297,475
Loans to participants ....................... 2,423,426 1,373,249 -- 1,373,249
Common/collective trusts
Putnam Stable Value ......................... 15,399,517 13,165,635 -- 13,165,635
------------ ------------ ------------ ------------
Total investments .............................. 186,056,304 95,706,225 -- 95,706,225
Receivables
Employer's contributions ....................... 7,021,605 5,865,647 -- 5,865,647
Due from brokers ............................... -- 37,053 -- 37,053
Due from plan sponsor .......................... -- -- 25,723 25,723
Miscellaneous .................................. -- -- 114 114
------------ ------------ ------------ ------------
Total receivables .............................. 7,021,605 5,902,700 25,837 5,928,537
------------ ------------ ------------ ------------
Total assets ................................... 193,077,909 101,608,925 25,837 101,634,762
Liabilities
Accounts payable ............................... -- -- 25,433 25,433
Due to related plan ............................ -- -- 90 90
------------ ------------ ------------ ------------
Total liabilities ............................. -- -- 25,523 25,523
------------ ------------ ------------ ------------
Net assets available for benefits ....................... $193,077,909 $101,608,925 $ 314 $101,609,239
============ ============ ============ ============
</TABLE>
The accompanying notes are an integral part of the financial statements.
-2-
<PAGE>
<TABLE>
<CAPTION>
COMDISCO RETIREMENT PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS, WITH FUND INFORMATION
Year Ended September 30, 1999
Putnam
The Putnam Putnam Putnam Growth
The George Fund for Inter- Putnam Bond Oppor-
Putnam Growth and Putnam Putnam national Stable Index tunities Loans to
Fund of Boston Income Income Vista Growth Value Fund Fund Participants
---------- ----------- ---------- ----------- ----------- ----------- -------- ------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Additions to net assets attributed to:
Investment income
Net appreciation in fair
value of investments ..... $ -- $ 652,644 $ -- $ 4,088,143 $ 3,099,435 $ -- $ -- $ -- $ --
Dividends .................. 474,901 1,217,654 339,999 1,515,632 272,737 823,231 -- -- --
Interest ................... 1,403 17,080 9,837 25,962 15,965 38,174 -- -- --
Loan repayments ............ 6,282 43,201 18,918 107,132 34,513 134,673 -- -- 1,870,388
---------- ----------- ---------- ----------- ----------- ----------- -------- ------- ----------
482,586 1,930,579 368,754 5,736,869 3,422,650 996,078 -- -- 1,870,388
Less: Investment expenses .. 125 728 342 1,189 552 552 -- -- --
---------- ----------- ---------- ----------- ----------- ----------- -------- ------- ----------
482,461 1,929,851 368,412 5,735,680 3,422,098 995,526 -- -- 1,870,388
Contributions
Employer ................... 174,238 597,026 -- 660,244 684,921 1,735,724 234,075 91,228 --
Participants ............... 353,996 1,142,162 408,727 1,117,738 1,005,684 1,133,545 -- -- --
---------- ----------- ---------- ----------- ----------- ----------- -------- ------- ----------
528,234 1,739,188 408,727 1,777,982 1,690,605 2,869,269 234,075 91,228 --
---------- ----------- ---------- ----------- ----------- ----------- -------- ------- ----------
Total additions ............ 1,010,695 3,669,039 777,139 7,513,662 5,112,703 3,864,795 234,075 91,228 1,870,388
Deductions from net assets attributed to:
Net depreciation in fair value
of investments ........... 82,310 -- 436,336 -- -- -- -- -- --
Loan issues ................ 36,687 186,881 75,656 315,443 99,642 156,167 -- -- 709,195
Benefits paid to participants 171,970 702,748 378,288 1,389,891 617,664 1,338,589 -- -- 111,016
Miscellaneous .............. -- -- -- -- -- -- -- -- --
---------- ----------- ---------- ----------- ----------- ----------- -------- -------- ----------
Total deductions ........... 290,967 889,629 890,280 1,705,334 717,306 1,494,756 -- -- 820,211
---------- ----------- ---------- ----------- ----------- ----------- -------- -------- ----------
Net increase (decrease) in
net assets prior
to transfers ................ 719,728 2,779,410 (113,141) 5,808,328 4,395,397 2,370,039 234,075 91,228 1,050,177
Transfers
Interfund transfers ......... (251,860) (1,266,594) (984,270) (941,769) (434,237) 78,438 -- -- --
Transfer from
Comdisco, Inc. ESOP.......... -- -- -- -- -- -- -- -- --
---------- ----------- ----------- ----------- ----------- ----------- -------- -------- ---------
Net increase (decrease) in net
assets available for benefits 467,868 1,512,816 (1,097,411) 4,866,559 3,961,160 2,448,477 234,075 91,228 1,050,177
Net assets available for benefits
Beginning of year .... 4,690,122 11,834,718 5,918,045 16,886,940 7,871,440 14,686,764 -- -- 1,373,249
---------- ----------- ---------- ----------- ----------- ----------- -------- -------- ----------
End of year ......... $5,157,990 $13,347,534 $4,820,634 $21,753,499 $11,832,600 $17,135,241 $234,075 $ 91,228 $2,423,426
========== =========== ========== =========== =========== =========== ======== ======== ==========
The accompanying notes are an integral part of the financial statements.
</TABLE>
-3-
<PAGE>
<TABLE>
<CAPTION>
COMDISCO RETIREMENT PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS, WITH FUND INFORMATION
Year Ended September 30, 1999
T. Rowe T. Rowe T.Rowe Comdisco
Price Price Price Comdisco Common Non
Equity Equity Small Cap Common Stock Participant
Income Index Value Stock (ESOP) Directed Total
----------- ----------- ----------- ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
Additions to net assets attributed to:
Investment income
Net appreciation in fair value
of investments ..................... $ 579,873 $ 2,383,408 $ -- $ 5,757,423 $ -- $ -- $ 16,560,926
Dividends ............................ 966,982 242,014 316,783 98,661 -- -- 6,268,594
Interest ............................. 20,419 24,418 8,225 15,226 -- -- 176,709
Loan repayments ...................... 56,326 75,558 17,288 38,596 -- -- 2,402,875
----------- ----------- ----------- ------------ ------------ ------------ ------------
1,623,600 2,725,398 342,296 5,909,906 -- -- 25,409,104
Less: Investment expenses ............ 608 711 204 903 -- -- 5,914
----------- ----------- ----------- ------------ ------------ ------------ ------------
1,622,992 2,724,687 342,092 5,909,003 -- -- 25,403,190
Contributions
Employer ............................. 814,959 1,245,340 295,096 495,754 -- -- 7,028,605
Participants ......................... 1,486,752 2,199,078 647,631 809,346 -- -- 10,304,659
----------- ----------- ----------- ------------ ------------ ------------ ------------
2,301,711 3,444,418 942,727 1,305,100 -- -- 17,333,264
----------- ----------- ----------- ------------ ------------ ------------ ------------
Total additions ...................... 3,924,703 6,169,105 1,284,819 7,214,103 -- -- 42,736,454
Deductions from net assets attributed to:
Net depreciation in fair value
of investments ..................... -- -- 134,880 -- -- -- 653,526
Loan issues .......................... 157,246 196,256 71,189 398,513 -- -- 2,402,875
Benefits paid to participants ........ 692,834 672,586 161,046 959,825 -- -- 7,196,457
Miscellaneous ........................ (69) -- -- -- -- 314 245
----------- ----------- ----------- ------------ ------------ ------------ ------------
Total deductions ..................... 850,011 868,842 367,115 1,358,338 -- 314 10,253,103
----------- ----------- ----------- ------------ ------------ ------------ ------------
Net increase (decrease) in net assets
prior to transfers .................... 3,074,692 5,300,263 917,704 5,855,765 -- (314) 32,483,351
Transfers
Interfund transfers ................... (3,343,183) 3,598,822 (551,853) 4,096,506 -- -- --
Transfer from Comdisco, Inc. ESOP ..... -- -- -- -- 58,985,319 -- 58,985,319
----------- ----------- ----------- ------------ ------------ ------------ ------------
Net increase (decrease) in net
assets available for benefits .......... (268,491) 8,899,085 365,851 9,952,271 58,985,319 (314) 91,468,670
Net assets available for benefits
Beginning of year .............. 11,755,972 10,250,466 3,958,474 12,382,735 -- 314 101,609,239
----------- ----------- ----------- ------------ ------------ ------------ ------------
End of year .................... $11,487,481 $19,149,551 $ 4,324,325 $ 22,335,006 $ 58,985,319 $ -- $193,077,909
=========== =========== =========== ============ ============ ============ ============
The accompanying notes are an integral part of the financial statements.
</TABLE>
-4-
<PAGE>
COMDISCO RETIREMENT PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS WITH FUND INFORMATION
YEAR ENDED SEPTEMBER 30, 1998
KEMPER MUTUAL FUNDS
<TABLE>
<CAPTION>
Small
Income Capital-
Blue High Capital- Inter- Money ization Total U.S.
Chip Growth Yield ization national Market Equity Technology Return Government
---- ------ ----- -------- -------- ------ ----- ---------- ------ ----------
Additions to net assets attributed to:
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Investment income
Net appreciation in
fair value of
investments ........ $ -- $ 54,843 $ 13,011 $ 14 $ 10,332 $ -- $ -- $ -- $ -- $ 376
Dividends .......... 2,641 710,328 101,852 118 70,180 11,460 426,272 72,678 608,271 4,055
Interest ........... -- -- -- -- -- -- -- -- -- --
Loan repayments ... -- -- -- -- -- -- -- -- -- --
Miscellaneous ..... -- -- -- -- -- -- -- --
---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ----------
2,641 765,171 114,863 132 80,512 11,460 426,272 72,678 608,271 4,431
Less: Investment
expenses .......... -- -- -- -- -- -- -- --
---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ----------
2,641 765,171 114,863 132 80,512 11,460 426,272 72,678 608,271 4,431
Contributions
Employer .......... -- -- -- -- -- -- -- -- -- --
Participants ...... -- 337,175 126,936 -- 94,615 40,633 210,817 13,977 119,488 5,639
---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ----------
-- 337,175 126,936 -- 94,615 40,633 210,817 13,977 119,488 5,639
---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ----------
Total
additions ......... 2,641 1,102,346 241,799 132 175,127 52,093 637,089 86,655 727,759 10,070
Deductions from
net assets
attributed to:
Net depreciation
in fair value of
investments ....... 171 -- -- -- -- -- 338,139 82,970 218,652 --
Loan issues ....... -- -- -- -- -- -- -- -- -- --
Benefits paid to
participants ...... -- 1,826,325 101,189 -- 114,553 85,205 409,351 150,510 -- --
---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ----------
Total deductions ... 171 1,826,325 101,189 -- 114,553 85,205 747,490 233,480 218,652 --
---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ----------
Net increase(decrease)
in net assets prior
to interfund
transfers ............ 2,470 (723,979) 140,610 132 60,574 (33,112) (110,401) (146,825) 509,107 10,070
Interfund
transfers ........... (19,813) (5,356,261) (2,567,336) (3,958) (1,758,366) (515,123) (4,537,504) (526,410) (6,345,204)(159,537)
-------- ----------- ----------- ------- ---------- --------- ---------- -------- ---------- --------
Net increase
(decrease) in net
assets available
for benefits ......... (17,343) (6,080,240) (2,426,726) (3,826) (1,697,792) (548,235) (4,647,905) (673,235) (5,836,097) (149,467)
Net assets
available for
benefits
Beginning of
year ............. 17,343 6,080,240 2,426,726 3,826 1,697,792 548,235 4,647,905 673,235 5,836,097 149,467
-------- ----------- ----------- ------- ----------- ------- ----------- --------- ---------- -------
End of year ....... $ -- $ -- $ -- $ -- $ -- $ -- $ -- $ -- $ -- $ --
======== =========== =========== ======== =========== ======= ========== ========= ========== =======
</TABLE>
The accompanying notes are an integral part of the financial statements.
-5-
<PAGE>
COMDISCO RETIREMENT PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS WITH FUND INFORMATION
YEAR ENDED SEPTEMBER 30, 1998
T. ROWE PRICE MUTUAL FUNDS
<TABLE>
<CAPTION>
U.S. Treasury Small
Capital Equity Equity International New Money Cap
App. Income Index Stock Income Market Value
-------- ------ ----- ----- ------ ------ -----
Additions to net assets attributed to:
<S> <C> <C> <C> <C> <C> <C> <C>
Investment income
Net appreciation in fair value
of investments ..................... $ -- $ -- $ 345,877 $ -- $ 4,298 $ 7 $ --
Dividends ............................ 755,225 950,214 148,232 250,016 26,414 20,202 72
Interest ............................. -- 3,123 2,646 -- -- -- 699
Loan repayments ...................... -- 5,799 7,274 -- -- -- 1,884
Miscellaneous ........................ -- -- -- -- -- -- --
----------- ----------- ----------- ----------- --------- ----------- -----------
755,225 959,136 504,029 250,016 30,712 20,209 2,655
Less: Investment expenses ............ -- 170 138 -- -- -- 39
----------- ----------- ----------- ----------- --------- ----------- -----------
755,225 958,966 503,891 250,016 30,712 20,209 2,616
Contributions
Employer ............................. -- 956,014 940,923 -- -- -- 299,978
Participants ......................... 457,922 1,688,559 1,613,012 362,556 116,328 115,533 327,066
----------- ----------- ----------- ----------- --------- ----------- -----------
457,922 2,644,573 2,553,935 362,556 116,328 115,533 627,044
----------- ----------- ----------- ----------- --------- ----------- -----------
Total additions ...................... 1,213,147 3,603,539 3,057,826 612,572 147,040 135,742 629,660
Deductions from net assets attributed to:
Net depreciation in fair value
of investments ..................... 233,186 790,382 -- 13,145 -- -- 1,158,675
Loan issues .......................... -- 102,984 97,683 -- -- -- 40,466
Benefits paid to participants ........ 322,679 612,985 671,310 600,697 60,509 4,202 9,223
----------- ----------- ----------- ----------- --------- ----------- -----------
Total deductions ..................... 555,865 1,506,351 768,993 613,842 60,509 4,202 1,208,364
----------- ----------- ----------- ----------- --------- ----------- -----------
Net increase (decrease) in net assets
prior to interfund transfers .......... 657,282 2,097,188 2,288,833 (1,270) 86,531 131,540 (578,704)
Interfund transfers ..................... (6,214,308) 1,540,545 2,493,392 (5,504,821) (678,250) (1,063,438) 4,537,178
----------- ----------- ----------- ----------- --------- ----------- -----------
Net increase (decrease) in net
assets available for benefits .......... (5,557,026) 3,637,733 4,782,225 (5,506,091) (591,719) (931,898) 3,958,474
Net assets available for benefits
Beginning of year .............. 5,557,026 8,118,239 5,468,241 5,506,091 591,719 931,898 --
----------- ----------- ----------- ----------- --------- ----------- -----------
End of year .................... $ -- $11,755,972 $10,250,466 $ -- $ -- $ -- $ 3,958,474
=========== =========== =========== =========== ========= =========== ===========
</TABLE>
The accompanying notes are an integral part of the financial statements.
-6-
<PAGE>
COMDISCO RETIREMENT PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS WITH FUND INFORMATION
YEAR ENDED SEPTEMBER 30, 1998
PUTNAM MUTUAL FUNDS
<TABLE>
<CAPTION>
The
George Growth
Putnam and International Stable Loan
Fund Income Income Vista Growth Value Fund
--------- ------ ------ ----- ------ ----- --------
Additions to net assets attributed to:
<S> <C> <C> <C> <C> <C> <C> <C>
Investment income
Net appreciation in fair value
of investments ..................... $ -- $ -- $ -- $ -- $ -- $ -- $ --
Dividends ............................ 73,231 135,653 183,574 17,092 97 388,210 --
Interest ............................. 136 1,894 567 2,345 1,697 8,882 --
Loan repayments ...................... 3,942 4,862 1,337 4,959 3,216 58,838 1,203,856
Miscellaneous ........................ -- -- -- -- -- -- --
----------- ------------ ---------- ------------ ----------- ----------- ----------
77,309 142,409 185,478 24,396 5,010 455,930 1,203,856
Less: Investment expenses ............ 23 202 140 428 124 144 --
----------- ------------ ---------- ------------ ----------- ----------- ----------
77,286 142,207 185,338 23,968 4,886 455,786 1,203,856
Contributions
Employer ............................. 158,123 532,016 252,753 494,858 579,635 1,521,130 --
Participants ......................... 124,857 496,554 213,120 447,251 454,862 549,596 --
----------- ------------ ---------- ------------ ----------- ----------- ----------
282,980 1,028,570 465,873 942,109 1,034,497 2,070,726 --
----------- ------------ ---------- ------------ ----------- ----------- ----------
Total additions ...................... 360,266 1,170,777 651,211 966,077 1,039,383 2,526,512 1,203,856
Deductions from net assets attributed to:
Net depreciation in fair value
of investments ..................... 387,662 1,555,761 88,662 2,980,434 1,513,672 -- --
Loan issues .......................... 15,563 109,100 99,777 321,367 100,467 131,179 120,839
Benefits paid to participants ........ -- 190,276 96,769 198,958 104,856 640,845 --
----------- ------------ ---------- ------------ ----------- ----------- ----------
Total deductions ..................... 403,225 1,855,137 285,208 3,500,759 1,718,995 772,024 120,839
----------- ------------ ---------- ------------ ----------- ----------- ----------
Net increase (decrease) in net assets
prior to interfund transfers .......... (42,959) (684,360) 366,003 (2,534,682) (679,612) 1,754,488 1,083,017
Interfund transfers ..................... 4,733,081 12,519,078 5,552,042 19,421,622 8,551,052 12,932,276 290,232
----------- ------------ ---------- ------------ ----------- ----------- ----------
Net increase (decrease) in net
assets available for benefits .......... 4,690,122 11,834,718 5,918,045 16,886,940 7,871,440 14,686,764 1,373,249
Net assets available for benefits
Beginning of year .............. -- -- -- -- -- -- --
----------- ------------ ---------- ------------ ----------- ----------- ----------
End of year .................... $ 4,690,122 $ 11,834,718 $5,918,045 $ 16,886,940 $ 7,871,440 $14,686,764 $1,373,249
=========== ============ ========== ============ =========== =========== ==========
</TABLE>
The accompanying notes are an integral part of the financial statements.
ents.
-7-
<PAGE>
COMDISCO RETIREMENT PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS WITH FUND INFORMATION
YEAR ENDED SEPTEMBER 30, 1998
<TABLE>
<CAPTION>
Hartford
Total Total Total Life Comdisco Non
Kemper T. Rowe Price Putnam Insurance Common Participant
Funds Funds Funds Contract Stock Directed Total
----------- ------------ ----------- ------------ ----------- ----------- ------------
Additions to net assets attributed to:
<S> <C> <C> <C> <C> <C> <C> <C>
Investment income
Net appreciation in fair value
of investments $ 78,576 $ 350,182 $ -- $ -- $ -- $ 6,671,040 $ 7,099,798
Dividends 2,007,855 2,150,375 797,857 -- 22,330 104,932 5,083,349
Interest -- 6,468 15,521 482,365 636 33,515 538,505
Loan repayments -- 14,957 1,281,010 -- 1,248 -- 1,297,215
Miscellaneous -- -- -- -- -- 685 685
----------- ------------ ----------- ------------ ----------- ----------- ------------
2,086,431 2,521,982 2,094,388 482,365 24,214 6,810,172 14,019,552
Less: Investment expenses -- 347 1,061 -- 130 93,741 95,279
----------- ------------ ----------- ------------ ----------- ----------- ------------
2,086,431 2,521,635 2,093,327 482,365 24,084 6,716,431 13,924,273
Contributions
Employer -- 2,196,915 3,538,515 -- 130,217 -- 5,865,647
Participants 949,280 4,680,976 2,286,240 455,724 116,992 -- 8,489,212
----------- ------------ ----------- ------------ ----------- ----------- ------------
949,280 6,877,891 5,824,755 455,724 247,209 -- 14,354,859
----------- ------------ ----------- ------------ ----------- ----------- ------------
Total additions 3,035,711 9,399,526 7,918,082 938,089 271,293 6,716,431 28,279,132
Deductions from net assets attributed to:
Net depreciation in fair value
of investments 639,932 2,195,388 6,526,191 -- 7,155,910 -- 16,517,421
Loan issues -- 241,133 898,292 -- 162,648 -- 1,302,073
Benefits paid to participants 2,687,133 2,281,605 1,231,704 1,808,717 134,327 4,402,578 12,546,064
----------- ------------ ----------- ------------ ----------- ----------- ------------
Total deductions 3,327,065 4,718,126 8,656,187 1,808,717 7,452,885 4,402,578 30,365,558
----------- ------------ ----------- ------------ ----------- ----------- ------------
Net increase (decrease) in net assets
prior to interfund transfers (291,354) 4,681,400 (738,105) (870,628) (7,181,592) 2,313,853 (2,086,426)
Interfund transfers (21,789,512) (4,889,702) 63,999,383 (14,096,254) 19,564,327 (42,788,242) --
----------- ------------ ----------- ------------ ----------- ----------- ------------
Net increase (decrease) in net
assets available for benefits (22,080,866) (208,302) 63,261,278 (14,966,882) 12,382,735 (40,474,389) (2,086,426)
Net assets available for benefits
Beginning of year 22,080,866 26,173,214 -- 14,966,882 -- 40,474,703 103,695,665
----------- ------------ ----------- ------------ ----------- ----------- -------------
End of year $ -- $ 25,964,912 $63,261,278 $ -- $12,382,735 $ 314 $101,609,239
=========== ============ =========== ============ =========== =========== ============
</TABLE>
The accompanying notes are an integral part of the financial statements.
-8-
<PAGE>
COMDISCO RETIREMENT PLAN
NOTES TO FINANCIAL STATEMENTS
September 30, 1999 and 1998
A. Description of Plan
The following description of the Comdisco Retirement Plan (previously
the Comdisco, Inc. Employees' Profit-Sharing Plan) provides only
general information. Participants should refer to the Plan agreement
for a more complete description of the Plan's provisions. The Plan was
amended and restated effective as of April 1, 1998.
1. General. The Plan is a defined contribution plan that
covers all employees of the Company and related companies who
have six months of employment and who are also at least age
twenty-one. Prior to April 1, 1998, the Plan covered all
full-time employees of the Company who had six months of
employment and 500 or more hours of service and who were also
at least age twenty-one. It is subject to the provisions of
the Employee Retirement Income Security Act of 1974 (ERISA).
2. Contributions. Each year, the Company contributes to the
Plan an amount as determined by the board of directors.
Additional 401(k) matching amounts are contributed at the rate
of fifty percent of the employees' before-tax contributions,
not to exceed $1,000 per employee. Prior to April 1, 1998,
matching contributions were made at the option of the
Company's board of directors. Participants may contribute up
to ten percent of their compensation on a before-tax basis
subject to certain limitations. Participants may also
contribute amounts representing distributions from other
qualified plans.
3. Participant Accounts. Each participant's account is
credited with the participant's contribution and an allocation
of (a) the Company's contribution, (b) Plan earnings, and (c)
forfeitures of terminated participants' nonvested accounts.
Allocations are based on participant earnings or account
balances, as defined. The benefit to which a participant is
entitled is the benefit that can be provided from the
participant's account.
4. Vesting. Participants are immediately vested in their
voluntary contributions plus actual earnings thereon. Vesting
in the remainder of their accounts is based on years of
continuous service. A participant is 100 percent vested after
five years of credited service.
5. Investment Options. As of April 1, 1998, participants can
direct their investments to any of the following investment
options.
Putnam Stable Value Fund
Investment Objective: Seeks stability of principal by
investing mainly in investment contracts issued by insurance
companies, banks, and other similar
-9-
<PAGE>
COMDISCO RETIREMENT PLAN
NOTES TO FINANCIAL STATEMENTS
September 30, 1999 and 1998
A. Description of Plan (continued)
financial institutions. To provide liquidity, a portion of the
fund's assets is invested in high-quality money market
instruments.
Putnam Income Fund
Investment Objective: Seeks current income consistent with
prudent risk by investing mainly in a variety of bonds, with
an emphasis on government bonds and corporate bonds from
creditworthy companies.
T. Rowe Price Equity Income Fund
Investment Objective: Seeks to provide high current income by
investing primarily in dividend-paying common stocks with
favorable prospects for capital appreciation.
The George Putnam Fund of Boston
Investment Objective: Seeks a balance of capital growth and
current income in a well-diversified portfolio composed mostly
of stocks and corporate and U.S. government bonds.
The Putnam Fund for Growth and Income
Investment Objective: Seeks capital growth and current income
by investing mainly in attractively priced stocks of mature
companies that offer long-term growth potential while also
providing income.
Putnam International Growth Fund
Investment Objective: Seeks capital appreciation by investing
in a diversified portfolio of stocks of companies located
mainly outside the United States.
Putnam Vista Fund
Investment Objective: Seeks capital appreciation by investing
mainly in a variety of stocks that have the potential for
above-average growth.
-10-
<PAGE>
COMDISCO RETIREMENT PLAN
NOTES TO FINANCIAL STATEMENTS
September 30, 1999 and 1998
A. Description of Plan (continued)
T. Rowe Price Equity Index Fund
Investment Objective: Seeks to provide long-term growth with
investment results equivalent to the total return of the U.S.
stock market as represented by the Standard & Poor's 500 Stock
Index.
T. Rowe Price Small Cap Value Fund
Investment Objective: Seeks long-term growth of capital
through investment in undervalued small-capitalization stocks
with attractive prospects for capital appreciation.
Comdisco Common Stock Account
Investment Objective: Seeks capital appreciation by investing
in Comdisco, Inc. common stock. This investment option allows
participants to share in the profits of the Company through
direct ownership.
Prior to April 1, 1998, a participant was able to direct their
contributions to any of the following investment options.
Hartford Life Insurance Companies
Kemper Mutual Funds
Blue Chip - A
Growth - A
High Yield - A
Income Capitalization - A
International - A
Money Market
Small Capitalization Equity - A
Technology - A
Total Return - A
U.S. Government - A
T. Rowe Price Mutual Funds
Capital Appreciation
Equity Income
Equity Index
International Stock
New Income
U.S. Treasury Money Market
As of April 1, 1998, participants may change their investment
options when they wish. Prior to April 1, 1998, this could
only be done semi-annually.
-11-
<PAGE>
COMDISCO RETIREMENT PLAN
NOTES TO FINANCIAL STATEMENTS
September 30, 1999 and 1998
A. Description of Plan (continued)
6. Participant Loans. Participants may borrow from their fund
accounts a minimum of $1,000 up to one-half of the current
value of the vested balance of their accounts, not to exceed
$50,000 minus their highest loan balances in the last twelve
months. The loans are secured by the balances in the
participants' accounts and bear interest at the prime rates in
effect on the first day of the quarter in which the loans are
approved, plus two percent. Principal and interest are repaid
ratably through payroll deductions over a reasonable period of
time (not to extend beyond five years or ten years for a
principal residence loan).
7. Payment of Benefits. On termination of service, the
benefits to which a participant is entitled are paid in
accordance with the Plan agreement.
8. Forfeited Accounts. At September 30, 1999 and 1998, there were
no forfeited nonvested accounts. During the years ended
September 30, 1999 and 1998, forfeited nonvested accounts
totaling $141,947 and $98,708, respectively, were applied to
the remaining participants' accounts as additional employer
contributions.
9. Plan Amendments. Effective April 1, 1998, the Plan was
amended and renamed the Comdisco Retirement Plan. On April 1,
1998, all Plan assets were liquidated and transferred on
behalf of the participants to Putnam Investments.
B. Summary of Accounting Policies
Basis of Accounting
The financial statements of the Plan are prepared under the accrual
method of accounting.
Investment Valuation
Investments are recorded at fair value. Shares of registered investment
companies are valued at quoted market prices which represent the net
asset value of shares held by the Plan at year-end. The Company stock
is valued at its quoted market price. Participant loans are valued at
cost which approximates fair value. Investments in common trust funds
are stated at estimated fair values, which have been determined based
on the unit values of the funds. Unit values are determined by the
banks sponsoring such funds by dividing the fund's net assets at fair
value by its units outstanding at the valuation dates.
-12-
<PAGE>
COMDISCO RETIREMENT PLAN
NOTES TO FINANCIAL STATEMENTS
September 30, 1999 and 1998
B. Summary of Accounting Policies (continued)
Realized Gains and Losses
Realized gains and losses are calculated using investment costs for
financial statement purposes, in accordance with generally accepted
accounting principles. For Form 5500 purposes, however, realized gains
and losses are calculated using the values of the investments at the
beginning of the Plan's year or at the times of purchase during the
Plan's year.
Benefits
Benefits are recorded when paid for financial statement purposes, in
accordance with generally accepted accounting principles for employee
benefit plans. For Form 5500 purposes, however, benefits are accrued in
order to comply with the requirements of the Department of Labor.
Estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires the Plan administrator to make
estimates and assumptions that affect certain reported amounts and
disclosures. Accordingly, actual results may differ from those
estimates.
C. Investments
The following table presents investments that represent five percent or
more of the Plan's net assets at September 30:
1999 1998
------------ ------------
Investments at fair value as
determined by quoted market price
Employer securities
Comdisco common stock ............. $ 21,839,252 $ 12,235,026
Comdisco common stock
(transferred from ESOP) ........ 8,985,319 --
Registered investment companies
Putnam International Growth ....... 11,147,679 7,291,804
The Putnam Fund for Growth
and Income ........................ 12,750,509 11,302,703
Putnam Income ..................... -- 5,665,292
Putnam Vista ...................... 21,093,256 16,392,081
T. Rowe Price Equity Income ....... 10,672,522 10,792,465
T. Rowe Price Equity Index ........ 17,911,209 9,297,475
Common/collective trusts
Putnam Stable Value ............... 15,399,517 13,165,635
------------ ------------
$119,799,263 $ 86,142,481
============ ============
-13-
<PAGE>
COMDISCO RETIREMENT PLAN
NOTES TO FINANCIAL STATEMENTS
September 30, 1999 and 1998
C. Investments (continued)
During the years ended September 30, 1999 and 1998, the Plan's
investments (including investments bought, sold, or held during the
year) appreciated or depreciated in value as follows:
<TABLE>
<CAPTION>
Net Change in Fair Value
Year Ended Year Ended
September 30, 1999 September 30, 1998
------------------ ------------------
<S> <C> <C>
Common stock ...................... $ -- $ 936,664
Employer securities ............... 5,757,423 (2,299,651)
Registered investment
companies ......................... 10,149,977 (8,054,636)
----------- -----------
Total net change in
fair value ........................ $15,907,400 $(9,417,623)
=========== ===========
</TABLE>
D. Reconciliation of Financial Statements to Forms 5500
The following is a reconciliation of net assets available for benefits
per the financial statements to Forms 5500:
<TABLE>
<CAPTION>
September 30, 1999 September 30, 1998
------------------ ------------------
<S> <C> <C>
Net assets available for
benefits per financial
statements $193,077,909 $101,609,239
Amounts allocated to
withdrawing participants - (11,758)
------------ ------------
Net assets available for
benefits per Forms 5500 $193,077,909 $101,597,481
============ ============
</TABLE>
-14-
<PAGE>
COMDISCO RETIREMENT PLAN
NOTES TO FINANCIAL STATEMENTS
September 30, 1999 and 1998
D. Reconciliation of Financial Statements to Forms 5500 (continued)
As previously stated in the summary of accounting policies, benefits
are recorded when paid for financial statement purposes but are accrued
for Form 5500 purposes. The following is a reconciliation of benefits
between Forms 5500 and the statements of changes in net assets
available for benefits, with fund information.
<TABLE>
<CAPTION>
Year Ended Year Ended
September 30, 1999 September 30, 1998
------------------ ------------------
<S> <C> <C>
Benefits per lines 32e(1) of
Forms 5500 ..................... $ 7,184,699 $ 4,559,062
Plus beginning amounts
allocated to withdrawing
participants ................... 11,758 7,998,760
Less ending amounts
allocated to withdrawing
participants ................... -- (11,758)
------------ ------------
Benefits paid per
statements of changes
in net assets available
for benefits, with fund
information .................... $ 7,196,457 $ 12,546,064
============ ============
</TABLE>
E. Plan Merger
On September 30, 1999, the Comdisco, Inc. Employee Stock Ownership Plan
(ESOP) was merged into the Comdisco Retirement Plan. The ESOP's only
asset at that time (3,054,255.987 shares of Comdisco, Inc. common stock
with a cost basis of $13,499,811 and a market value of $58,985,319),
was transferred to Putnam. A "Transferred ESOP Account", which reflects
the amount transferred and the income, losses, appreciation and
depreciation attributable thereto, is maintained by Putnam for each
person who was a participant of the Comdisco, Inc. ESOP on September
30, 1999. A participant becomes fully vested in his "Transferred ESOP
Account" after five years of service to the Company. There is no
vesting otherwise.
F. Administrative Expenses
Comdisco, Inc. pays for the significant administrative costs of the
Plan outside of the investment expenses.
-15-
<PAGE>
COMDISCO RETIREMENT PLAN
NOTES TO FINANCIAL STATEMENTS
September 30, 1999 and 1998
G. Information Certified by Custodians
The certified annual statements of the custodian provide year-end
market values of each class of investment, net appreciation or
depreciation in fair values of each class of investment, interest and
dividend income of each class of investment, and are the source for
such information included in the financial statements and supplemental
schedules. The custodians have certified that the information provided
to the Plan administrator by the custodians is complete and accurate.
H. Plan Termination
Although it has not expressed any intent to do so, the Company has the
right under the Plan to discontinue its contributions at any time and
to terminate the Plan subject to the provisions of ERISA. In the event
of Plan termination, participants will become 100 percent vested in
their accounts.
I. Tax Status
The trust established under the Plan to hold the Plan's assets is
qualified pursuant to the appropriate section of the Internal Revenue
Code and, accordingly, the trust's net investment income is exempt from
income taxes. The Plan has obtained a favorable tax determination
letter dated October, 1996, from the Internal Revenue Service. The Plan
has been amended since receiving the determination letter. However, the
Plan sponsor believes that the Plan is designed and is currently being
operated in compliance with the applicable requirements of the IRC.
-16-
<PAGE>
(David J. Miller & Associates, LLP Letterhead)
INDEPENDENT AUDITOR'S REPORT ON
SUPPLEMENTARY INFORMATION
To the Trustees of the Comdisco Retirement Plan
Our audits were performed for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedules of assets held
for investment purposes as of September 30, 1999 and 1998 and assets held for
investment purposes which were both acquired and disposed within the plan year
ended September 30, 1998 are presented for the purpose of additional analysis
and are not a required part of the basic financial statements but are
supplementary information required by the Department of Labor's Rules and
Regulations for Reporting and Disclosure under the Employee Retirement Income
Security Act of 1974. The supplemental schedules have been subjected to the
auditing procedures applied in the audits of the basic financial statements and,
in our opinion are fairly stated in all material respects in relation to the
basic financial statements taken as a whole.
/s/ David J. Miller & Associates, LLP
January 21, 2000
Deerfield, Illinois
<PAGE>
SUPPLEMENTARY INFORMATION
<PAGE>
<TABLE>
<CAPTION>
COMDISCO RETIREMENT PLAN
SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
September 30, 1999
Description of
Investment Including
Maturity Date, Rate of
Identity of Issue, Borrower, Interest, Collateral, Par,
Lessor, or Similar Party or Maturity Value Cost Current Value
- ------------------------ ---------------------- ---- -------------
<S> <C> <C> <C>
Employer Securities
* Comdisco, Inc. 1,130,835.080 Shares $ 9,949,236 $ 21,839,252
* Comdisco, Inc.
(transferred from ESOP) 3,054,255.987 Shares 13,499,811 58,985,319
----------- ------------
$ 23,449,047 $ 80,824,571
============ ============
Registered Investment
Companies
T. Rowe Price
Equity Index 516,024.466 Shares $ 16,594,388 $ 17,911,209
Equity Income 403,040.845 Shares 11,162,861 10,672,522
Small Cap Value 215,813.075 Shares 4,893,900 4,029,230
Putnam Investments
The George Putnam Fund
of Boston 284,948.666 Shares 5,417,846 4,983,752
The Putnam Fund for Growth
and Income 636,888.562 Shares 13,612,515 12,750,509
Income 745,074.611 Shares 5,244,469 4,820,633
Vista 1,497,037.313 Shares 20,025,103 21,093,256
International Growth 489,147.839 Shares 9,619,609 11,147,679
------------ -----------
$ 86,570,691 $ 87,408,790
============= ============
Common/Collective Trusts
Putnam Stable Value 15,399,516.74 Shares $ 15,399,517 $ 15,399,517
============= ============
Loans to Participants
* Participant Loans 9.75% - 10.25%, various
maturities $ - $ 2,423,426
============= ============
Total Investments $125,419,255 $186,056,304
============= ============
</TABLE>
* party-in-interest
See independent auditor's report on supplementary information.
-18-
<PAGE>
<TABLE>
<CAPTION>
COMDISCO RETIREMENT PLAN
SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
September 30, 1998
Description of
Investment Including
Maturity Date, Rate of
Identity of Issue, Borrower, Interest, Collateral, Par,
Lessor, or Similar Party or Maturity Value Cost Current Value
- ------------------------ ----------------- ---- -----------
<S> <C> <C> <C>
Employer Securities
* Comdisco, Inc. 897,983.59 Shares $ 2,354,506 $12,235,026
========== ===========
Registered Investment
Companies
T. Rowe Price
Equity Index 336,134.312 Shares $10,110,933 $ 9,297,475
Equity Income 430,321.579 Shares 12,034,841 10,792,465
Small Cap Value 190,944.486 Shares 4,758,306 3,658,496
Putnam Investments
The George Putnam Fund
of Boston 254,749.827 Shares 4,911,808 4,531,999
The Putnam Fund for Growth
and Income 595,819.867 Shares 12,814,869 11,302,703
Income 807,021.615 Shares 5,749,819 5,665,292
Vista 430,373.575 Shares 19,326,750 16,392,081
International Growth 450,389.383 Shares 8,800,652 7,291,804
----------- -----------
$78,507,978 $68,932,315
=========== ===========
Common/Collective Trusts
Putnam Stable Value 13,165,634.78 Shares $13,165,635 $13,165,635
=========== ===========
Loans to Participants
* Participant Loans 8% - 11%, various
maturities $ - $ 1,373,249
=========== ===========
Total Investments $94,028,119 $95,706,225
=========== ===========
* party-in-interest
</TABLE>
See independent auditor's report on supplementary information.
-19-
<PAGE>
COMDISCO RETIREMENT PLAN
SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
WHICH WERE BOTH ACQUIRED AND DISPOSED WITHIN THE PLAN YEAR
Year Ended September 30, 1998
<TABLE>
<CAPTION>
Description of
Investment Including
Maturity Date, Rate of
Identity of Issue, Borrower, Interest, Collateral, Par, Cost of Proceeds of
Lessor, or Similar Party or Maturity Value Acquisitions Dispositions
- --------------------------- -------------------------- ------------ ------------
<S> <C> <C> <C>
Common Stock
Advanced Fibre
Communications, Inc. ................................ 8,700 Shares $ 270,414 $ 338,201
Allied Signal, Inc. .................................. 6,000 Shares 230,096 250,382
ASM Lithography Holding .............................. 2,600 Shares 239,184 182,870
Berg Electrs Corporation ............................. 9,000 Shares 225,000 240,294
Cable Design Technologies
Corporation ......................................... 12,750 Shares 350,304 337,286
Calenergy, Inc. ...................................... 5,100 Shares 193,163 199,651
CBS Corporation ...................................... 9,300 Shares 253,751 311,751
Ciena Corporation .................................... 4,500 Shares 239,584 181,398
Colgate Palmolive Co. ................................ 2,900 Shares 254,879 250,668
Grey Wolfe, Inc. ..................................... 28,000 Shares 245,570 117,316
Hearst Argyle Television ............................. 9,100 Shares 260,721 332,139
Home Depot, Inc. ..................................... 4,100 Shares 234,202 271,645
Meditrust Paired CTF ................................. 7,800 Shares 293,973 231,786
Microchip Technology, Inc. ........................... 2,200 Shares 84,975 60,550
Monsanto Co. ......................................... 6,900 Shares 302,541 361,824
News Corporation Ltd. ................................ 10,500 Shares 249,072 296,195
PSW Technologies ..................................... 22,800 Shares 266,713 153,201
Sipex Corporation .................................... 7,000 Shares 207,728 251,992
Tellabs, Inc. ........................................ 3,800 Shares 222,491 257,441
---------- ----------
$4,624,361 $4,626,590
========== ==========
</TABLE>
See independent auditor's report on supplementary information.
-20-
[David J. Miller & Associates, LLP Letterhead]
Consent of David J. Miller & Associates, LLP
The Board of Directors
Comdisco, Inc.
We consent to the incorporation by reference in the Registration Statement on
Form S-8 of Comdisco, Inc. of our reports dated January 21, 2000, relating to
the statements of net assets available for benefits of Comdisco Retirement Plan
(the "Plan") as of September 30, 1999 and 1998, and the related statements of
changes in net assets available for benefits for the years then ended, which
reports appear in this Annual Report on Form 11-K of the Plan filed with the
Commission on March 31, 2000.
/s/ David J. Miller & Associates, LLP
March 31, 2000
Deerfield, Illinois
