AT&T CAPITAL CORP /DE/, PRE 14A, 1998-06-16

AT&T CAPITAL CORP /DE/
PRE 14A, 1998-06-16
FINANCE SERVICES

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SCHEDULE 14A
(Rule 14a-101)

INFORMATION REQUIRED IN PROXY STATEMENT

SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934

Filed by the Registrant /x/ Filed by a Party other than the Registrant / /

Check the appropriate box:
/x/ Preliminary Proxy Statement / / Confidential, for Use of the Commission
Only (as permitted by Rule 14a-6(e)(2))
/ / Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12

AT&T Capital Corporation
Capita Preferred Funding L.P.
Capita Preferred Trust
(Names of Registrants as Specified In Their Charters)

(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)

Payment of Filing Fee (Check the appropriate box):
/x/ No fee required.
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.

1) Title of each class of securities to which transaction applies:

2) Aggregate number of securities to which transaction applies:

3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which
the filing fee is calculated and state how it was determined):

4) Proposed maximum aggregate value of transaction:

5) Total fee paid:

/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the form or schedule and the date of its filing.

1) Amount Previously Paid:

2) Form, Schedule or Registration Statement No.:

3) Filing Party:

4) Date Filed:

<PAGE>
[Company Logo] OFFER TO PURCHASE AND CONSENT SOLICITATION

AT&T CAPITAL CORPORATION
OFFER TO PURCHASE FOR CASH
Any and All Outstanding
CAPITA PREFERRED TRUST
9.06% Trust Originated Preferred Securities ("TOPrS")
(Liquidation Amount $25 per Trust Preferred Security)
CUSIP # 139710206
at a Price of $______ per Security

_________________________

THE OFFER AND RELATED WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW
YORK CITY TIME, ON __________ ___, 1998, UNLESS THE OFFER IS EXTENDED

AT&T Capital Corporation, a Delaware corporation ("AT&T Capital"),
invites the holders of 9.06% Trust Originated Preferred Securities
("TOPrS ") (liquidation amount $25 per Trust Preferred Security) ("Trust
Preferred Securities" or "Securities") of Capita Preferred Trust, a statutory
business trust formed under the laws of the State of Delaware and an
affiliate of AT&T Capital (the "Trust"), to tender any and all of their Trust
Preferred Securities for purchase at the purchase price of $____ per Security
(the "Purchase Price"), plus an amount equal to any accrued and unpaid
distribution accumulated on each tendered Security up to but not including
the Payment Date (as defined herein), net to the seller in cash, upon the
terms and subject to the conditions set forth in this Offer to Purchase and
Consent Solicitation and the related Letter of Transmittal and Consent (which
together constitute the "Offer"). AT&T Capital will purchase any and all
Securities validly tendered and not withdrawn, upon the terms and subject to
the conditions of the Offer, including the receipt by AT&T Capital of
Consents to the Proposed Amendments (each as defined below) from holders as
of the Record Date (as defined herein) of Securities representing at least a
majority in liquidation amount of all of the outstanding Trust Preferred
Securities (the "Requisite Consent Condition"). See "Terms of the Offer--
Certain Conditions of the Offer" and "Terms of the Offer--Extension of Tender
Period; Termination; Amendments."

In conjunction with the Offer, AT&T Capital hereby solicits consents
(each, a "Consent") from the holders of Trust Preferred Securities as of
__________ ___, 1998 (the "Record Date") to proposed amendments (the
"Proposed Amendments") to (i) the Amended and Restated Limited Partnership
Agreement (the "Limited Partnership Agreement"), pursuant to which
partnership preferred securities ("Partnership Preferred Securities")
representing limited partnership interests of Capita Preferred Funding L.P.,
a Delaware limited partnership (the "Partnership") were issued, and which
relevant amendments will provide for an early redemption of the Partnership
Preferred Securities as described herein, and (ii) the indentures (the
"Indentures"), pursuant to which three debentures (the "Debentures") have
been issued by AT&T Capital and two of its wholly owned subsidiaries (such
subsidiaries, the "Subsidiary Issuers"), respectively, and which relevant
amendments will provide for an early redemption of such Debentures as
described herein. The proper tender of Trust Preferred Securities by holders
as of the Record Date shall constitute the giving of a Consent by such
<PAGE>
holders with respect to their tendered Trust Preferred Securities. Holders
of Trust Preferred Securities who acquire such Trust Preferred Securities
after the Record Date shall have the right to tender their Trust Preferred
Securities pursuant to the Offer, but shall not have the right to provide
Consents. A holder of Trust Preferred Securities as of the Record Date will
be permitted to provide such holder's Consent even if such holder does not
tender Trust Preferred Securities pursuant to the Offer. No separate payments
will be made for Consents. See "The Consent Solicitation."

AT&T Capital will pay to a Soliciting Dealer (as defined herein) a
solicitation fee for each Trust Preferred Security tendered, accepted for
payment and paid for pursuant to the Offer, subject to certain conditions.
See "Solicitation Fees, Other Fees and Expenses."

Concurrently with AT&T Capital's purchase of Trust Preferred
Securities tendered pursuant to the Offer and adoption of the Proposed
Amendments, AT&T Capital will and hereby does exercise its (and will and
hereby does cause each of the Subsidiary Issuers and the Partnership to
exercise their respective) optional redemption rights under the Indentures
and the Limited Partnership Agreement (each as amended by the Proposed
Amendments), which in turn will cause the optional redemption of any and all
Trust Preferred Securities that have not been validly tendered in the Offer.
Holders of Trust Preferred Securities who do not tender their Securities in
the Offer will receive a redemption price of $____ per Security (the
"Redemption Price"), plus an amount equal to any accrued and unpaid
distribution accumulated on each redeemed Security up to but not including
the Payment Date, net to the seller in cash. The Redemption Price is less
than the Purchase Price being offered by AT&T Capital for the tender of
Securities in the Offer. If holders of Securities fail to validly tender
their Securities in the Offer and, upon the terms and conditions of the
Offer, AT&T Capital accepts for payment and purchases Securities tendered
pursuant to the Offer, such non-tendering holders will only receive the
Redemption Price, plus accrued and unpaid distributions thereon, for
Securities that have not been validly tendered in the Offer. See "The
Consent Solicitation--Optional Redemption of Non-Tendered Securities."

The Trust was created and exists for the sole purpose of issuing the
Trust Preferred Securities and common securities (all of which are owned by
AT&T Capital) and engaging in the activities described below. The Trust's
assets consist exclusively of the Partnership Preferred Securities. AT&T
Capital is the sole general partner of the Partnership (in such capacity, the
"General Partner"). The Partnership's assets consist exclusively of the
Debentures and a limited amount of U.S. government obligations and commercial
paper of persons not affiliated with AT&T Capital which meet certain
eligibility criteria (the "Eligible Debt Securities"). The payment of
distributions by each of the Trust and the Partnership have been guaranteed
by AT&T Capital, to the extent the Trust and the Partnership have funds
available therefor.
_________________________

THIS TRANSACTION HAS NEITHER BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION") NOR BY ANY STATE
SECURITIES COMMISSION. THE COMMISSION HAS NOT PASSED UPON THE FAIRNESS OR
MERITS OF THIS TRANSACTION NOR UPON THE ACCURACY OR ADEQUACY OF THE
<PAGE>
INFORMATION CONTAINED IN THIS DOCUMENT. ANY REPRESENTATION TO THE CONTRARY
IS UNLAWFUL.
_________________________

NEITHER AT&T CAPITAL, THE SUBSIDIARY ISSUERS, THE TRUST, THE
PARTNERSHIP, THEIR RESPECTIVE BOARD OF DIRECTORS OR TRUSTEES OR GENERAL
PARTNER, NOR ANY OF THEIR RESPECTIVE OFFICERS MAKES ANY RECOMMENDATION TO ANY
HOLDER OF TRUST PREFERRED SECURITIES AS TO WHETHER TO TENDER ANY OR ALL
SECURITIES OR TO CONSENT TO THE PROPOSED AMENDMENTS. EACH HOLDER MUST MAKE
HIS OR HER OWN DECISION AS TO WHETHER TO TENDER SECURITIES AND, IF SO, HOW
MANY SECURITIES TO TENDER, OR TO CONSENT TO THE PROPOSED AMENDMENTS.

_________________________

This Offer to Purchase and Consent Solicitation is first being mailed
on or about _________ __, 1998.

_________________________

The Dealer Manager for the Offer is:
MERRILL LYNCH & CO.

The date of this Offer to Purchase and Consent Solicitation is __________
___, 1998.

"Trust Originated Preferred Securities" and "TOPrS" are service marks of
Merrill Lynch & Co., Inc.
<PAGE>
IMPORTANT

Any beneficial owner of Trust Preferred Securities desiring to accept
the Offer and tender all or any portion of its Securities should contact the
relevant participant (i.e., a custodian bank, depositary, broker, trust
company or other nominee) (such participant, a "DTC Participant") of The
Depository Trust Company ("DTC") through which such owner holds its Trust
Preferred Securities promptly and instruct such DTC Participant to tender on
such beneficial owner's behalf pursuant to the procedures described herein.
See "Terms of the Offer--Procedures for Tendering Securities."

A proper tender of Trust Preferred Securities pursuant to the
procedures outlined under "Terms of the Offer--Procedures for Tendering
Securities" by holders of Trust Preferred Securities as of the Record Date
shall also constitute the giving of a Consent by such holders with respect to
such Trust Preferred Securities. See "The Consent Solicitation--Procedures
for Consenting." All of the Trust Preferred Securities currently held
through DTC have been issued in the form of a global certificate or
certificates registered in the name of Cede & Co., DTC's nominee (the "Global
Certificates"). Upon consummation of the Offer and the transactions
contemplated thereby (including the exercise of the amended optional
redemption rights with respect to the Debentures and the Partnership
Preferred Securities), the aggregate principal amount of the Global
Certificates shall be reduced to zero, representing the purchase and/or
redemption of all outstanding Trust Preferred Securities.

Tendering holders of Trust Preferred Securities are not obligated to
pay brokerage fees or commissions to the Dealer Manager (as defined below),
the Depositary, the Information Agent (as defined below) or AT&T Capital.
_________________________

No dealer, salesperson or other person has been authorized to give
information or to make any representation not contained in this Offer to
Purchase and Consent Solicitation and the related Letter of Transmittal and
Consent and, if given or made, such information or representation may not be
relied upon as having been authorized by AT&T Capital and its affiliates,
including the Trust or the Partnership.
_________________________

THIS OFFER TO PURCHASE AND CONSENT SOLICITATION CONTAIN IMPORTANT
INFORMATION WHICH SHOULD BE READ BEFORE ANY DECISION IS MADE WITH RESPECT TO
EITHER A TENDER OF SECURITIES OR A CONSENT TO THE PROPOSED AMENDMENTS.
_________________________

Questions or requests for assistance may be directed to Georgeson &
Company Inc. (the "Information Agent") or to Merrill Lynch & Co. ("Merrill
Lynch" or the "Dealer Manager") at their respective telephone numbers and
addresses set forth on the back cover of this Offer to Purchase and Consent
Solicitation. Requests for additional copies of this Offer to Purchase and
Consent Solicitation, a Letter of Transmittal and Consent or other tender
offer or consent materials may be directed to the Information Agent, and such
copies will be furnished promptly at AT&T Capital's expense. Holders of
Trust Preferred Securities may also contact their local broker, dealer,
commercial bank or trust company for assistance concerning the Offer.
<PAGE>
Table of Contents

Page

SUMMARY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

TERMS OF THE OFFER . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Number of Securities; Purchase Price; Expiration Date . . . . . 13
Effect of Not Tendering Securities . . . . . . . . . . . . . . . 14
Procedures for Tendering Securities . . . . . . . . . . . . . . 14
Withdrawal Rights . . . . . . . . . . . . . . . . . . . . . . . 16
Acceptance of Securities for Payment and Payment of Purchase
Price . . . . . . . . . . . . . . . . . . . . . . . . . 17
Certain Conditions of the Offer . . . . . . . . . . . . . . . . 18
Extension of Tender Period; Termination; Amendments . . . . . . 20

THE CONSENT SOLICITATION . . . . . . . . . . . . . . . . . . . . . . . . 21
The Solicitation . . . . . . . . . . . . . . . . . . . . . . . . 21
Requisite Consents . . . . . . . . . . . . . . . . . . . . . . . 21
Procedures for Consenting . . . . . . . . . . . . . . . . . . . 22
The Proposed Amendments . . . . . . . . . . . . . . . . . . . . 23
Optional Redemption of Non-Tendered Securities . . . . . . . . . 24

PURPOSE OF OFFER AND CONSENT SOLICITATION . . . . . . . . . . . . . . . . 24
Reasons for Offer and Consent Solicitation . . . . . . . . . . . 24
Effect of Offer and Consent Solicitation . . . . . . . . . . . . 25

PRICE RANGE OF SECURITIES; DISTRIBUTIONS . . . . . . . . . . . . . . . . 25

CERTAIN FEDERAL INCOME TAX CONSEQUENCES . . . . . . . . . . . . . . . . . 26
Sale of Trust Preferred Securities Pursuant to the Offer . . . . 27
Redemption of Trust Preferred Securities . . . . . . . . . . . . 27
Backup Withholding . . . . . . . . . . . . . . . . . . . . . . . 28
State and Local Tax Consequences . . . . . . . . . . . . . . . . 28

SOURCE AND AMOUNT OF FUNDS . . . . . . . . . . . . . . . . . . . . . . . 29

TRANSACTIONS AND AGREEMENTS CONCERNING THE SECURITIES . . . . . . . . . . 29

SOLICITATION FEES, OTHER FEES AND EXPENSES . . . . . . . . . . . . . . . 29

CERTAIN INFORMATION REGARDING AT&T CAPITAL AND NEWCOURT . . . . . . . . . 30
AT&T Capital . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Newcourt . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31

AVAILABLE INFORMATION; INCORPORATION OF DOCUMENTS BY REFERENCE . . . . . 31

SUMMARY OF FINANCIAL INFORMATION . . . . . . . . . . . . . . . . . . . . 32

MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
ANNEXES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-1
Annex A-1 -- The Proposed Amendment to AT&T Capital's Indenture
A-1
<PAGE>
Annex A-2 -- The Proposed Amendment to Subsidiary Issuers' Indentures
A-4
Annex A-3 -- The Proposed Amendment to Limited Partnership Agreement
A-7
<PAGE>
SUMMARY

The following summary is provided solely for the convenience of the
holders of Trust Preferred Securities. This summary is not intended to be
complete and is qualified in its entirety by reference to the full text and
more specific details contained in this Offer to Purchase and Consent
Solicitation and the related Letter of Transmittal and Consent and any
amendments or supplements hereto or thereto. Holders of Trust Preferred
Securities are urged to read this Offer to Purchase and Consent Solicitation
and the related Letter of Transmittal and Consent in their entirety. Each of
the capitalized terms used in this summary and not defined herein has the
meaning set forth elsewhere in this Offer to Purchase and Consent
Solicitation.

The Companies

AT&T Capital and the
Subsidiary Issuers . . . . AT&T Capital Corporation, a Delaware
corporation, located at AT&T Capital
Corporation, 44 Whippany Road, Morristown,
New Jersey 07962. AT&T Capital and the
Subsidiary Issuers (AT&T Capital Leasing
Services, Inc. and AT&T Capital Services
Corporation, respectively) are the issuers
of the Debentures owned by the Partnership.
The First National Bank of Chicago, N.A.,
is the indenture trustee with respect to
such Debentures (in such capacity, the
"Indenture Trustee"). On January 12, 1998,
Newcourt Credit Group Inc. ("Newcourt")
acquired all of the issued and outstanding
shares of AT&T Capital and AT&T Capital
became an indirect wholly-owned subsidiary
of Newcourt.

The Trust . . . . . . . . . Capita Preferred Trust is a Delaware
statutory business trust. The sole assets
of the Trust are the Partnership Preferred
Securities. The First National Bank of
Chicago, N.A., is the property trustee (in
such capacity, the "Property Trustee") for
the Trust.

The Partnership . . . . . . Capita Preferred Funding L.P. is a Delaware
limited partnership. As of the date
hereof, the assets of the Partnership
consist of the Debentures and the Eligible
Debt Securities. AT&T Capital is the sole
General Partner of the Partnership and, in
such capacity, is entitled to consent to
the Proposed Amendments so long as the
Requisite Consents are received from
<PAGE>
holders of Securities as of the Record
Date.

The Offer

Terms of the Offer . . . . AT&T Capital hereby offers to purchase any
and all Trust Preferred Securities tendered
by holders thereof at the Purchase Price,
which is equal to $_____ per Security, plus
an amount equal to any accrued and unpaid
distribution accumulated on each tendered
Security up to but not including the
Payment Date, net to the seller in cash. As
of the date hereof, there are 8,000,000
Securities outstanding.

Expiration Date of the Offer The Offer expires at 5:00 p.m., New York City
time, on __________ ___, 1998, unless
extended by AT&T Capital in its sole
discretion (the "Expiration Date").
Requisite Consents . . . . The Property Trustee holds title to the
Partnership Preferred Securities for the
benefit of the holders of Trust Preferred
Securities. The Property Trustee is
entitled to consent to the Proposed
Amendments so long as Consents are received
from holders as of the Record Date of
Securities representing at least a majority
in liquidation amount of all of the
outstanding Trust Preferred Securities
(such Consents, the "Requisite Consents").

Conditions to the Offer . . The Offer is conditioned on, among other
things, the satisfaction of the Requisite
Consent Condition, which requires AT&T
Capital to receive Requisite Consents to
the Proposed Amendments from holders of
Securities as of the Record Date. See
"Terms of the Offer--Certain Conditions of
the Offer." The proper tender of Trust
Preferred Securities by a holder as of the
Record Date shall constitute the giving of
a Consent by such holder with respect to
such Trust Preferred Securities.

Procedures for Tendering . All of the Trust Preferred Securities are
held in book-entry form through the DTC
Participants (i.e., a custodian bank,
depositary, broker, trust company or other
nominee). A beneficial owner who wishes to
tender Securities pursuant to the Offer
should promptly instruct the DTC
<PAGE>
Participant through which such beneficial
owner holds its Securities to tender such
Securities on behalf of such beneficial
owner pursuant to the procedures described
herein. In order to provide Consents on
behalf of beneficial owners of Securities
not tendering, participants should complete
and sign the Letter of Transmittal and mail
or deliver such Letter of Transmittal to
the Depositary. See "Terms of the Offer--
Procedures for Tendering Securities." For
further information, call the Information
Agent or the Dealer Manager at their
respective telephone numbers and addresses
set forth on the back cover of this Offer
to Purchase and Consent Solicitation or
consult your broker, dealer, commercial
bank, trust company or custodian for
assistance.
Withdrawal Rights . . . . . Tendered Trust Preferred Securities may be
withdrawn at any time until the Expiration
Date and, unless previously accepted for
payment, may also be withdrawn after
__________ ___, 1998. See "Terms of the
Offer--Withdrawal Rights." The Consent
accompanying any tendered Securities that
are withdrawn will not be considered
revoked unless the holder specifically
revokes such Consent as described herein.
See "The Consent Solicitation."

Payment Date . . . . . . . Upon the terms and conditions of the Offer,
AT&T Capital will accept for payment and
will pay for all Securities validly
tendered and not properly withdrawn
promptly after the Expiration Date, which
is expected to be within four business days
of the Expiration Date (such date of
payment, the "Payment Date").

The Consent Solicitation

The Proposed Amendments . . In conjunction with the Offer, AT&T Capital
is soliciting consents from the holders of
record of Trust Preferred Securities as of
the Record Date to the Proposed Amendments,
which consist of amendments to (i) the
Limited Partnership Agreement providing for
an early redemption of the Partnership
Preferred Securities, and (ii) the
Indentures providing for an early
<PAGE>
redemption of the Debentures (the "Consent
Solicitation").

Currently, the Limited Partnership Agreement
does not permit the Partnership Preferred
Securities to be optionally redeemed prior
to October 1, 2006, and the Indentures do
not permit the Debentures to be optionally
redeemed prior to September 30, 2006. As
described under "The Consent Solicitation--
The Proposed Amendments," the Proposed
Amendments will permit AT&T Capital, the
Subsidiary Issuers and the Partnership to
redeem their respective Debentures and the
Partnership Preferred Securities
immediately upon the effectiveness of the
Proposed Amendments (without any further
action required on their part).

Procedures for Consenting . . The proper tender of Trust Preferred
Securities by holders as of the Record Date
shall constitute the giving of a Consent by
such holders with respect to their tendered
Trust Preferred Securities. Holders of
Trust Preferred Securities who acquire such
Trust Preferred Securities after the Record
Date shall have the right to tender their
Trust Preferred Securities pursuant to the
Offer, but shall not have the right to
provide Consents. A holder of Trust
Preferred Securities as of the Record Date
will be permitted to provide such holder's
Consent even if such holder does not tender
Trust Preferred Securities pursuant to the
Offer. No separate payments will be made
for Consents. See "The Consent
Solicitation."

Record Date . . . . . . . . . The Record Date with respect to the
Securities is __________ __, 1998.

The Optional Redemption . . . Concurrently with AT&T Capital's purchase of
Securities tendered pursuant to the Offer
and adoption of the Proposed Amendments,
AT&T Capital will and hereby does exercise
(and will and hereby does cause each of the
Subsidiary Issuers and the Partnership to
exercise) their respective optional
redemption rights under the Indentures and
the Limited Partnership Agreement (each as
amended by the Proposed Amendments), which
in turn will cause the optional redemption
of any and all Trust Preferred Securities
<PAGE>
that have not been tendered in the Offer.
Holders of Trust Preferred Securities who
do not tender their Securities in the Offer
will receive the Redemption Price of $____
per Security, plus an amount equal to any
accrued and unpaid distribution accumulated
on each redeemed Security up to but not
including the Payment Date, net to the
seller in cash. The Redemption Price is
less than the Purchase Price being offered
by AT&T Capital for the tender of
Securities in the Offer. If holders of
Securities fail to validly tender their
Securities in the Offer and, AT&T Capital
obtains the Requisite Consents upon the terms
and conditions of the Offer, AT&T Capital
accepts for payment and purchases
Securities tendered pursuant to the Offer,
such non-tendering holders will only
receive the Redemption Price, plus accrued
and unpaid distributions thereon, for
Securities that have not been validly
tendered in the Offer. See "The Consent
Solicitation--Optional Redemption of Non-
Tendered Securities."

Purpose of the Offer and
Consent Solicitation . . . . The purpose of the Offer is to acquire all of
the issued and outstanding Trust Preferred
Securities. The purpose of the Consent
Solicitation is to cause the adoption of
the Proposed Amendments. Concurrent with
the adoption of the Proposed Amendments,
the Debentures and the Partnership
Preferred Securities will be optionally
redeemed, which in turn will cause the
optional redemption of any and all Trust
Preferred Securities that have not been
tendered in the Offer. Following the
receipt of the Requisite Consents
consummation of the Offer and the Consent
Solicitation in accordance with their
respective terms, there will not be any
Trust Preferred Securities that remain
outstanding. See "Purpose of Offer and
Consent Solicitation."

Solicitation Fees . . . . . . AT&T Capital will pay to Soliciting Dealers
designated by the beneficial owner of the
Securities validly tendered and accepted
pursuant to the Offer a solicitation fee
equal to $0.375 per Security tendered for
cash (except in the case of transactions
equal to or exceeding 10,000 Securities,
AT&T Capital will only pay $0.250 per
<PAGE>
Security tendered for cash, of which 80%
shall be paid to Merrill Lynch and 20% to
the designated Soliciting Dealer (which may
be Merrill Lynch)). In cases where no
Soliciting Dealer is designated, the Dealer
Manager will be paid 100% of the applicable
Soliciting Dealer Fee. Soliciting Dealers
are not entitled to a solicitation fee for
any Securities beneficially owned by such
Soliciting Dealers. See "Solicitation Fees,
Other Fees and Expenses."

Further Information . . . . . Additional copies of this Offer to Purchase
and Consent Solicitation and the Letter of
Transmittal and Consent may be obtained by
contacting the Information Agent at its
address and telephone number set forth on
the back cover of this Offer to Purchase
and Consent Solicitation. Questions about
the Offer should be directed to the Dealer
Manager, at its address and telephone
number set forth on the back cover of this
Offer of Purchase and Consent Solicitation.
Copies of the other documents incorporated
by reference herein may be obtained as
described below under "Available
Information; Incorporation of Documents by
Reference."
<PAGE>
TERMS OF THE OFFER

Number of Securities; Purchase Price; Expiration Date

Upon the terms and subject to the conditions described herein and in the
related Letter of Transmittal and Consent, AT&T Capital will purchase any and
all Securities that are validly tendered on or prior to the Expiration Date
(and not properly withdrawn in accordance with "Terms of the Offer--
Withdrawal Rights") at the Purchase Price, which is equal to $_____ per
Security, plus an amount equal to any accrued and unpaid distribution
accumulated on each tendered Security up to but not including the Payment
Date, net to the seller in cash. As of the date hereof, there are 8,000,000
Securities outstanding.

In conjunction with the Offer, AT&T Capital is also soliciting Consents
from the holders of Securities as of the Record Date to the Proposed
Amendments. The proper tender of Trust Preferred Securities by such holders
shall constitute the giving of a Consent by such holders with respect to
their tendered Trust Preferred Securities. Holders of Trust Preferred
Securities who acquire Trust Preferred Securities after the Record Date shall
have the right to tender their Trust Preferred Securities pursuant to the
Offer, but shall not have the right to provide Consents. A holder of Trust
Preferred Securities as of the Record Date will be permitted to provide such
holder's Consent even if such holder does not tender Trust Preferred
Securities pursuant to the Offer. No separate payments will be made for
Consents. See "The Consent Solicitation."

Concurrently with AT&T Capital's purchase of Securities in the Offer and
adoption of the Proposed Amendments, AT&T Capital will exercise its (and will
cause each of the Subsidiary Issuers and the Partnership to exercise their
respective) optional redemption rights under the Indentures and the Limited
Partnership Agreement (each as amended by the Proposed Amendments), which in
turn will cause the optional redemption of any and all Trust Preferred
Securities that have not been validly tendered in the Offer. Holders of
Trust Preferred Securities who do not tender their Securities in the Offer
will receive the Redemption Price rather than the Purchase Price offered in
the Offer. The Redemption Price is less than the Purchase Price being offered
by AT&T Capital for the tender of Securities in the Offer. If holders of
Securities fail to validly tender their Securities in the Offer and, upon the
terms and conditions of the Offer, AT&T Capital accepts for payment and
purchases Securities in the Offer, such non-tendering holders will only
receive the Redemption Price, plus accrued and unpaid distributions thereon,
for Securities that have not been validly tendered in the Offer. See
"Consent Solicitation--Optional Redemption of Non-Tendered Securities."

THE OFFER IS CONDITIONED UPON THE SATISFACTION OF THE REQUISITE CONSENT
CONDITION AND CERTAIN OTHER CONDITIONS. SEE "--CERTAIN CONDITIONS OF THE
OFFER."

The Expiration Date is 5:00 p.m., New York City time, on ___________
___, 1998, unless extended. AT&T Capital expressly reserves the right, in its
sole discretion, and at any time and/or from time to time, to extend the
period of time during which the Offer is open, by giving oral or written
notice of such extension to the Depositary and making a public announcement
thereof. There is no assurance whatsoever that AT&T Capital will exercise
its right to extend the Offer for the Trust Preferred Securities.

NO ALTERNATIVE, CONDITIONAL OR CONTINGENT TENDERS WILL BE ACCEPTED AND
NO TENDERS FROM HOLDERS AS OF THE RECORD DATE WILL BE ACCEPTED IN RESPECT OF
<PAGE>
SECURITIES FOR WHICH A CONSENT TO THE PROPOSED AMENDMENTS HAS NOT BEEN GIVEN
BY SUCH HOLDERS. SUCH CONSENT MAY BE GIVEN BY PROPERLY COMPLETING THE FORM
OF CONSENT THAT IS A PART OF THE LETTER OF TRANSMITTAL AND CONSENT.

Effect of Not Tendering Securities

Concurrently with AT&T Capital's purchase of Trust Preferred Securities
tendered pursuant to the Offer and adoption of the Proposed Amendments, AT&T
Capital will and hereby does exercise its (and will and hereby does cause
each of the Subsidiary Issuers and the Partnership to exercise theirrespective)
optional redemption rights under the Indentures and the Limited
Partnership Agreement (each as amended by the Proposed Amendments), which in
turn will cause the optional redemption of any and all Trust Preferred
Securities that have not been validly tendered in the Offer. Holders of
Trust Preferred Securities who do not tender their Securities in the Offer
will receive the Redemption Price of $____ per Security, plus an amount equal
to any accrued and unpaid distribution accumulated on each redeemed Security
up to but not including the Payment Date, net to the seller in cash. The
Redemption Price is less than the Purchase Price being offered by AT&T
Capital for the tender of Securities in the Offer. If holders of Securities
fail to validly tender their Securities in the Offer and, upon the terms and
conditions of the Offer, AT&T Capital accepts for payment and purchases
Securities tendered pursuant to the Offer, such non-tendering holders will
only receive the Redemption Price, plus accrued and unpaid distributions
thereon, for Securities that have not been validly tendered in the Offer.
See "The Consent Solicitation--Optional Redemption of Non-Tendered
Securities."

Procedures for Tendering Securities

The tender of Securities by a holder hereof pursuant to one of the
procedures set forth below will constitute an agreement between such holder
and AT&T Capital in accordance with the terms and subject to the conditions
set forth herein and in the related Letter of Transmittal and the right of
AT&T Capital to terminate the Offer as described herein and such holder's
right to withdraw tendered Securities as described herein.

All of the Securities are held in book-entry form through DTC
Participants (i.e., a custodial bank, depositary, broker, trust company or
other nominee). Any beneficial owner of Securities who wishes to tender such
Securities in the Offer should contact the DTC Participant through which such
owner holds its Securities promptly and instruct such DTC Participant to
tender on such beneficial owner's behalf pursuant to the procedures described
herein.

Book-Entry Transfer. Pursuant to an authorization given by DTC to the
DTC Participants, each DTC Participant that holds Securities through DTC must
(i) transmit its acceptance through the DTC Automated Tender Offer Program
("ATOP") (for which the transaction will be eligible), and DTC will then edit
and verify the acceptance, execute a book-entry delivery to the Depositary's
account at DTC and either (A) DTC will send an Agent's Message (as defined
herein) to the Depositary for its acceptance or (B) the DTC Participant will
complete and sign the Letter of Transmittal and mail or deliver such Letter
of Transmittal, and any other documents required by the Letter of
Transmittal, to the Depositary, or (ii) comply with the guaranteed delivery
procedures set forth in this Offer to Purchase and Consent Solicitation. A
proper tender of Securities pursuant to the foregoing procedures by holders
of Securities as of the Record Date will also constitute the giving of a
<PAGE>
Consent by such holders with respect to such Securities. See "The Consent
Solicitation---Procedures for Consenting." The Depositary will (promptly
after the date of this Offer to Purchase and Consent Solicitation) establish
an account at DTC for the purpose of the Offer, and any financial institution
that is a DTC Participant may make book-entry delivery of interests in
Securities into the Depositary's account through ATOP. However, although
delivery of interests in the Securities may be effected through book-entry
transfer into the Depositary's account through ATOP, an Agent's Message in
connection with such book-entry transfer or a Letter of Transmittal, and any
other required documents, must be, in any case, transmitted to and received
by the Depositary at its address set forth on the back cover of this Offer to
Purchase and Consent Solicitation or the guaranteed delivery procedures set
forth below must be complied with, in each case, prior to the Expiration
Date. Delivery of documents to DTC does not constitute delivery to the
Depositary. The confirmation of book-entry transfer into the Depositary's
account at DTC through ATOP as described above is referred to herein as
"Book-Entry Confirmation." The Depositary and DTC have confirmed that the
Offer and the solicitation of Consents from holders as of the Record Date are
eligible for ATOP. Holders desiring to tender Securities prior to the
Expiration Date should note that such holders must allow sufficient time for
completion of the ATOP procedures during the normal business hours of DTC on
that date.

The term "Agent's Message" means a message transmitted by DTC to, and
received by, the Depositary and forming a part of the Book-Entry
Confirmation, which states that DTC has received an express acknowledgement
from each DTC Participant tendering through ATOP that such DTC Participants
(a) have received a Letter of Transmittal and agree to be bound by the terms
of the Letter of Transmittal and AT&T Capital may enforce such agreement
against such DTC Participants and (b) if tendering on behalf of holders of
Securities as of the Record Date, Consent to the Proposed Amendments as
described herein.

All of the Trust Preferred Securities currently held through DTC have
been issued in the form of Global Certificates registered in the name of
Cede & Co., DTC's nominee. Upon consummation of the Offer and the
transactions contemplated thereby (including the exercise of the amended
optional redemption rights with respect to the Debentures and the Partnership
Preferred Securities), the aggregate principal amount of the Global
Certificates shall be reduced to zero, representing the purchase and/or
redemption of all outstanding Trust Preferred Securities.

Guaranteed Delivery. If a DTC Participant desires to participate in the
Offer and the procedure for book-entry transfer cannot be completed on a
timely basis, a tender may be effected if the Depositary has received at one
of its addresses on the back cover hereof prior to the Expiration Date, a
letter, telegram or facsimile transmission from a firm or other entity
identified in Rule 17Ad-15 under the Securities Exchange Act of 1934 (the
"Exchange Act") (an "Eligible Institution"), including (as such terms are
defined therein): (i) a bank; (ii) a broker, dealer, municipal securities
dealer, municipal securities broker, government securities dealer or
government securities broker; (iii) a credit union; (iv) a national
securities exchange, registered securities association or clearing agency; or
(v) a savings institution that is a participant in a Securities Transfer
Association recognized program, setting forth the name and address of the DTC
Participant, the name(s) in which the Securities are held and stating that
the tender is being made thereby and guaranteeing that within two NYSE
trading days after the date of execution of such letter, telegram or
<PAGE>
facsimile transmission by the Eligible Institution, the procedure for
book-entry transfer with respect to such Securities will be completed.
Unless the Securities being tendered by the above-described method are
deposited with the Depositary within the time period set forth above in
accordance with DTC's ATOP procedures and a Letter of Transmittal or an
Agent's Message is received, AT&T Capital may, at its option, reject the
tender. Copies of the Notice of Guaranteed Delivery which may be used by
Eligible Institutions for the purposes described in this paragraph are
available from the Depositary and the Information Agent.
Miscellaneous. All questions as to the validity, form, eligibility
(including time of receipt) and acceptance for exchange of any tender of
Securities in connection with the Offer will be determined by AT&T Capital,
whose determination will be final and binding. AT&T Capital reserves the
absolute right to reject any or all tenders not in proper form or the
acceptance for exchange of which may, in the opinion of counsel for AT&T
Capital be unlawful. AT&T Capital also reserves the absolute right to waive
any defect or irregularity in the tender of any Securities in the Offer, and
the interpretation by AT&T Capital of the terms and conditions of its Offer
(including the instructions in the Letter of Transmittal) will be final and
binding. None of AT&T Capital, the Subsidiary Issuers, the Trust, the
Partnership, the Depositary, the Dealer Managers, the Information Agent or
any other person will be under any duty to give notification of any defects
or irregularities in tenders or incur any liability for failure to give any
such notification.

Tenders of Securities involving any irregularities will not be deemed to
have been made until such irregularities have been cured or waived.
Securities received by the Depositary in connection with the Offer that are
not validly tendered and as to which the irregularities have not been cured
or waived will be returned by the Depositary to the DTC Participant who
delivered such Securities by crediting an account maintained at DTC
designated by such DTC Participant as promptly as practicable after the
Expiration Date or the withdrawal or termination of the Offer.

FOR FURTHER INFORMATION, CALL THE INFORMATION AGENT OR THE DEALER
MANAGER OR CONSULT YOUR BROKER FOR ASSISTANCE.

Withdrawal Rights

ANY SECURITIES TENDERED BY HOLDERS AS OF THE RECORD DATE FOR WHICH A
CONSENT TO THE PROPOSED AMENDMENTS WAS NOT VALIDLY GIVEN WILL BE DEEMED
WITHDRAWN AND NOT VALIDLY TENDERED BY SUCH HOLDER.

Tenders of Securities pursuant to the Offer may be withdrawn at any time
prior to the Expiration Date and may be withdrawn at any time after
__________ ___, 1998.

Beneficial owners desiring to withdraw Securities previously tendered
should contact the DTC Participant through which such owners hold their
Securities. In order to withdraw Securities previously tendered, a DTC
Participant may, prior to the Expiration Date, withdraw its instruction
previously transmitted through ATOP by (i) withdrawing its acceptance through
ATOP, or (ii) delivering to the Depositary by mail, hand delivery or
facsimile transmission notice of withdrawal of such instruction. Such notice
of withdrawal must contain the name and number of the DTC Participant, the
amount of Securities to which such withdrawal relates and the signature of
the DTC Participant. Withdrawal of a prior instruction will be effective
<PAGE>
upon receipt of such notice of withdrawal by the Depositary. All signatures
on a notice of withdrawal must be guaranteed by a recognized participant in
the Securities Transfer Agents Medallion Program, the NYSE Medallion
Signature Program or the Stock Exchange Medallion Program; provided, however,
that signatures on the notice of withdrawal need not be guaranteed if the
Securities being withdrawn are held for the account of an Eligible
Institution. A withdrawal of an instruction must be executed by a DTC
Participant in the same manner as such DTC Participant's name appears on its
transmission through ATOP to which such withdrawal relates. A DTC
Participant may withdraw a tender only if such withdrawal complies with the
provisions of this Offer to Purchase and Consent Solicitation.

A holder of Securities as of the Record Date who previously tendered
Securities may not validly revoke a Consent unless such holder validly
withdraws such holder's previously tendered Securities in the manner
described herein and, except as described below, the valid withdrawal by such
holder of Securities will constitute the concurrent valid revocation of such
holder's Consent. Holders of Securities as of the Record Date who provide
Consents but do not tender Securities pursuant to the Offer will be permitted
to revoke such Consents in the manner described under "The Consent
Solicitation---Requisite Consents."

If the Requisite Consents are received with respect to the Securities,
AT&T Capital, the Subsidiary Issuers, the Indenture Trustee and the Property
Trustee shall as soon as practicable (but in no event sooner than 20 business
days after the mailing of this Offer to Purchase and Consent Solicitation)
execute the Proposed Amendments. To the extent adopted, the Proposed
Amendments shall take effect immediately prior to AT&T Capital's acceptance
and payment for all Securities validly tendered pursuant to the Offer. Once
the Proposed Amendments have been executed, a Consent will not be permitted
to be revoked, and the Proposed Amendments will bind all holders from time to
time of the Securities regardless of whether such holders shall have granted
or revoked Consents to the Proposed Amendments.

Withdrawals of tenders of Securities may not be rescinded and any
Securities withdrawn will thereafter be deemed not validly tendered for
purposes of the Offer. Properly withdrawn Securities, however, may be
retendered by following the procedures therefor described elsewhere herein at
any time prior to the Expiration Date. See "---Procedures for Tendering
Securities."

All questions as to the form and validity (including time of receipt) of
any notice of withdrawal will be determined by AT&T Capital, in its sole
discretion, and its determination will be final and binding. None of AT&T
Capital, the Subsidiary Issuers, the Trust, the Partnership, the Dealer
Manager, the Depositary, the Information Agent or any other person will be
under any duty to give notification of any defect or irregularity in any
notice of withdrawal or will incur any liability for failure to give any such
notification.

Acceptance of Securities for Payment and Payment of Purchase Price

Upon the terms and subject to the conditions of the Offer, and as
promptly as practicable after the Expiration Date, which is expected to be
within four business days, AT&T Capital will accept for payment (and thereby
purchase) and pay for Securities validly tendered and not withdrawn as
permitted in "--Withdrawal Rights" above. Thereafter, payment for all
Securities validly tendered on or prior to the Expiration Date and accepted
<PAGE>
pursuant to the Offer will be made by the Depositary via DTC as promptly as
practicable after the Expiration Date. In all cases, payment for Securities
accepted for payment pursuant to the Offer will be made promptly but only
after timely receipt by the Depositary of certificates for such Securities
(or of an Agent's Message), a properly completed and duly executed Letter of
Transmittal and Consent and any other required documents.

For purposes of the Offer, AT&T Capital will be deemed to have accepted
for payment (and thereby purchased) Securities that are validly tendered and
not withdrawn as, if and when it gives oral or written notice to the
Depositary of its acceptance for payment of such Securities. AT&T Capital
will pay for Securities that it has purchased pursuant to the Offer by
depositing the Purchase Price therefor with the Depositary, which will act as
agent for holders of Trust Preferred Securities who have tendered for the
purpose of receiving payment from AT&T Capital and transmitting the payment
thereof to such holders. Under no circumstances will interest be paid on
amounts to be paid by either the Trust or AT&T Capital to tendering holders
of Trust Preferred Securities who tender, regardless of any delay in making
such payment. Because of all these securities are held in book-entry form
through DTC, all tendered Securities will be credited to an account
maintained with the Book-Entry Transfer Facility, as promptly as practicable,
without incurring expense to the holder of Trust Preferred Securities who has
tendered.

If certain events occur, AT&T Capital may not be obligated to purchase
Securities pursuant to the Offer. See "Terms of the Offer--Certain Conditions
of the Offer."

Because the Securities represent undivided interests in the Trust, there
will be no stock transfer taxes due or payable with respect to the sale and
transfer of any Securities pursuant to the Offer. See Instruction 6 of the
accompanying Letter of Transmittal and Consent.

Certain Conditions of the Offer

Notwithstanding any other provision of the Offer, AT&T Capital shall not
be required to accept for payment or pay for any Securities tendered, and may
terminate or amend the Offer (by oral or written notice to the Depositary and
timely public announcement) or may postpone (subject to the requirements of
the Exchange Act) for prompt payment for or return of Securities the
acceptance for payment of, or payment for, Securities tendered, if at any
time on or prior to the Expiration Date, the conditions in clauses (a) and
(b) are not satisfied or any of the events specified in clauses (c) through
(f) occurs (which shall not have been waived by AT&T Capital):

(a) there having been received (and not withdrawn) prior to the
Expiration Date the Requisite Consents to the Proposed Amendments from
holders of Securities as of the Record Date (i.e., the satisfaction of
the Requisite Consent Condition);

(b) the execution by each of AT&T Capital, the Subsidiary Issuers,
the Indenture Trustee and the Property Trustee of the Proposed
Amendments to (i) the Indentures and (ii) the Limited Partnership
Agreement;

(c) there shall have been threatened, instituted or pending any
action or proceeding by any government or governmental, regulatory or
administrative agency, authority or tribunal or any other person,
<PAGE>
domestic or foreign, or before any court, authority, agency or tribunal
that (i) challenges the acquisition of Securities pursuant to the Offer
or otherwise in any manner relates to or affects the Offer or (ii) in
the reasonable judgment of AT&T Capital, would or might materially and
adversely affect the business, conditions (financial or otherwise),
income, operations or prospects of AT&T Capital or any of its
subsidiaries, or otherwise materially impair in any way the contemplated
future conduct of the business of AT&T Capital or any of its
subsidiaries or materially impair the contemplated benefits of the Offer
to AT&T Capital;

(d) there shall have been any action threatened, pending or taken,
or approval withheld, or any statute, rule, regulation, judgment, order
or injunction threatened, proposed, sought, promulgated, enacted,
entered, amended, enforced or deemed to be applicable to the Offer or
AT&T Capital or any of its subsidiaries, by any legislative body, court,
authority, agency or tribunal that, in AT&T Capital's reasonable
judgment, would or might directly or indirectly (i) make the acceptance
for payment of, or payment for, some or all of the Securities illegal or
otherwise restrict or prohibit consummation of the Offer; (ii) delay or
restrict the ability of AT&T Capital, or render AT&T Capital unable, to
accept for payment or pay for some or all of the Securities; (iii)
materially impair the contemplated benefits of the Offer to AT&T Capital
(including materially increasing the effective interest cost of certain
types of unsecured debt); or (iv) materially affect the business,
condition (financial or otherwise), income, operations or prospects of
AT&T Capital or any of its subsidiaries, or otherwise materially impair
in any way the contemplated future conduct of the business of AT&T
Capital or any of its subsidiaries;

(e) there shall have occurred (i) any significant decrease in the
market price of the Securities; (ii) any change in the general
political, market, economic or financial conditions in the United
States, Canada or other foreign countries that, in the reasonable
judgment of AT&T Capital, would or might have a material adverse effect
on AT&T Capital's business, operations, prospects or ability to obtain
financing generally or the trading in the Securities or other equity
securities of AT&T Capital or its affiliates; (iii) the declaration of a
banking moratorium or any suspension of payments in respect of banks in
the United States or any limitation on, or any event that, in AT&T
Capital's reasonable judgment, would or might affect the extension of
credit by lending institutions in the United States; (iv) the
commencement of war, armed hostilities or other international or
national calamity directly or indirectly involving the United States;
(v) any general suspension of trading in, or limitation on prices for,
securities on any national securities exchange or in the over-the-
counter market; (vi) in the case of any of the foregoing existing at the
time of the commencement of the Offer, in AT&T Capital's reasonable
judgment, a material acceleration or worsening thereof; or (vii) a
decline in the ratings accorded any of AT&T Capital's securities by
Standard & Poor's Rating Services ("S&P"), Moody's Investors Service,
Inc. ("Moody's"), Duff & Phelps, Inc. ("D&P") or Fitch Investor Services
Inc. ("Fitch") or that S&P, Moody's, D&P or Fitch has announced that it
has placed any such rating under surveillance or review with negative
implications; or

(f) there shall have occurred any event or events that have
resulted, or in AT&T Capital's reasonable judgment may result, in an
<PAGE>
actual or threatened change in the business, conditions (financial or
otherwise), income, operations, stock ownership or prospects of AT&T
Capital or any of its subsidiaries;

and, in the sole judgment of AT&T Capital, such event or events make it
undesirable or inadvisable to proceed with the Offer or with such acceptance
for payment or payment.

The foregoing conditions are for the sole benefit of AT&T Capital and
may be asserted by AT&T Capital regardless of the circumstances (including
any action or inaction by AT&T Capital) giving rise to any such condition,
and any such condition may be waived by AT&T Capital, in whole or in part, at
any time and from time to time in its sole discretion. The failure by AT&T
Capital at any time to exercise any of the foregoing rights shall not be
deemed a waiver of any such right and each such right shall be deemed an
ongoing right which may be asserted at any time and from time to time. Any
determination by AT&T Capital concerning the above will be final and binding
on all parties.

Extension of Tender Period; Termination; Amendments

AT&T Capital expressly reserves the right, in its sole discretion,
subject to applicable law, to (i) terminate the Offer, and not accept for
payment any Securities tendered in the Offer and promptly return such
Securities upon the failure of any of the conditions specified above under "-
- -Certain Conditions of the Offer," (ii) waive any condition to the Offer
(other than the Requisite Consent Condition) and accept for payment all
Securities previously tendered pursuant to the Offer, (iii) extend the
Expiration Date of the Offer and retain all Securities tendered pursuant to
the Offer until the Expiration Date (as extended), subject to all withdrawal
rights of holders described above under "--Withdrawal Rights," or (iv) amend
any of the terms of the Offer, including, without limitation, increasing or
decreasing the consideration offered in the Offer to holders of Securities.
There can be no assurance, however, that AT&T Capital will exercise its right
to extend the Offer. During any such extension, all Securities previously
tendered will remain subject to the Offer, except to the extent that such
Securities may be withdrawn as set forth in "--Withdrawal Rights" above.

AT&T Capital also expressly reserves the right, in its sole discretion,
to, among other things, terminate the Offer and not accept for payment or pay
for any Securities tendered, subject to Rule 13e-4(f)(5) under the Exchange
Act, which requires AT&T Capital either to pay the consideration offered or
to return the Securities tendered promptly after the termination or
withdrawal of the Offer upon the occurrence of any of the conditions
specified in "--Certain Conditions of the Offer" above by giving oral or
written notice of such termination to the Depositary, and making a public
announcement thereof.

Subject to compliance with applicable law, AT&T Capital further reserves
the right, in its sole discretion, to amend the Offer in any respect.
Amendments to the Offer may be made at any time and/or from time to time and
effected by public announcement thereof. Such announcement, in the case of
an extension, shall be issued no later than 9:00 a.m., New York City time, on
the next business day after the previously scheduled Expiration Date. Any
public announcement made pursuant to the Offer will be disseminated promptly
to holders of Trust Preferred Securities affected thereby in a manner
reasonably designed to inform such holders of Trust Preferred Securities of
such change. Without limiting the manner in which AT&T Capital may choose to
<PAGE>
make a public announcement, except as required by applicable law, AT&T
Capital shall have no obligation to publish, advertise or otherwise
communicate any such public announcement other than by making a release to
the Dow Jones News Service.

If AT&T Capital materially changes the terms of the Offer or the
information concerning the Offer, or if it waives a material condition of the
Offer, AT&T Capital will extend the Offer to the extent required by Rules
13e-4(d)(2) and 13e-4(e)(2) under the Exchange Act. Those rules require that
the minimum period during which the Offer must remain open following material
changes in the terms of the Offer or information concerning the Offer (other
than a change in price or in percentage of securities sought) will depend on
the facts and circumstances, including the relative materiality of such
changes. With respect to a change in price or, subject to certain
limitations, a change in the percentage of securities sought, a minimum ten
business day period from the day of such change is generally required to
allow for adequate dissemination to holders of Trust Preferred Securities. In
the case of any amendment, withdrawal or termination of the Offer, a public
announcement will be issued no later than 9:00 a.m., New York City time, on
the next business day after the previously scheduled Expiration Date. If
AT&T Capital withdraws or terminates the Offer, it will give immediate notice
to the Information Agent and the Dealer Manager, and the Securities tendered
pursuant to the Offer will be returned promptly to the tendering holders
thereof. For purposes of the Offer, a "business day" means any day other than
a Saturday, Sunday, or a federal holiday and consists of the time period from
12:01 a.m. through 12:00 Midnight, New York City time.

THE CONSENT SOLICITATION

The Solicitation

In conjunction with the Offer, AT&T Capital hereby solicits Consents
from the holders of record of Trust Preferred Securities as of the Record
Date (which is ___________ ___, 1998) to the Proposed Amendments, which
consist of amendments to (i) the Limited Partnership Agreement providing for
an early redemption of the Partnership Preferred Securities, and (ii) the
Indentures providing for an early redemption of the Debentures, in each case
as described below under "--The Proposed Amendments." The proper tender of
Trust Preferred Securities by such holders shall constitute the giving of a
Consent by holders with respect to their tendered Trust Preferred Securities.
Holders of Trust Preferred Securities who acquire such Trust Preferred
Securities after the Record Date shall have the right to tender their Trust
Preferred Securities pursuant to the Offer, but shall not have the right to
provide Consents. A holder of Trust Preferred Securities as of the Record
Date will be permitted to provide such holder's Consent even if such holder
does not tender Trust Preferred Securities pursuant to the Offer. No separate
payments will be made for Consents.

The Offer is conditioned upon the satisfaction of the Requisite Consent
Condition and certain other conditions. See "The Terms of the Offer--Certain
Conditions of the Offer."

Requisite Consents

The Indentures permit the Proposed Amendments to the Indentures to be
adopted if the registered holders of all of the Debentures affected thereby
consent thereto. All of the Debentures are held of record by the Partnership.
<PAGE>
AT&T Capital, as the General Partner, is required by the terms of the Limited
Partnership Agreement to obtain the approval of holders of at least a
majority in liquidation preference of the Partnership Preferred Securities
prior to the General Partner's delivery of such consent, provided that, if
(as is the case) the Property Trustee is the holder of the Partnership
Preferred Securities, the General Partner's consent will not be effective
without the delivery of the Requisite Consents from holders of the
Securities as of the Record Date.

Similarly, the Limited Partnership Agreement permits the Proposed
Amendment to the Limited Partnership Agreement to be adopted if the
registered holders of a majority in liquidation preference of the Partnership
Preferred Securities consent thereto, provided that, if (as is the case) the
Property Trustee is the holder of the Partnership Preferred Securities, any
consent by the Property Trustee (as the registered holder of all of the
Partnership Preferred Securities) will not be effective without the delivery
of the Requisite Consents from holders of the Securities as of the Record
Date.

As provided by the terms of the Trust's Amended and Restated Declaration
of Trust, dated as of October 22, 1996 (the "Declaration of Trust"), AT&T
Capital and its affiliates will not be entitled to consent with respect to
any Trust Preferred Securities held by them and such Securities will be
treated as if they were not outstanding for purposes of the Proposed
Amendments. Neither AT&T Capital nor any of its affiliates owns any Trust
Preferred Securities. As described above under "Terms of the Offer--Certain
Conditions to the Offer," AT&T Capital will not accept and pay for any
Securities pursuant to the Offer (and therefore will not be the owner of such
Securities) until and after the Proposed Amendments have been adopted.

Based on the foregoing, the Proposed Amendments will be adopted if
holders of record of Trust Preferred Securities as of the Record Date
representing not less than a majority in liquidation amount of all
outstanding Trust Preferred Securities have given Consents (i.e., the
Requisite Consent Condition has been satisfied). As of the Record Date,
there were issued and outstanding 8,000,000 Trust Preferred Securities.
Accordingly, the Requisite Consents for the Trust Preferred Securities will
require Consents of the holders of 4,000,001 or more of the outstanding Trust
Preference Securities.

Procedures for Consenting

All of the Trust Preferred Securities are held in book-entry form
through DTC Participants. The proper tender of Trust Preferred Securities by
holders of such Trust Preferred Securities as of the Record Date shall
constitute the giving of a Consent by such holders with respect to such Trust
Preferred Securities. See "Terms of the Offer--Procedures for Tendering
Securities." Any beneficial owner of Trust Preferred Securities as of the
Record Date who wishes to provide Consents with respect to such Trust
Preferred Securities without tendering such owner's Trust Preferred
Securities should contact its DTC Participant though which such beneficial
owner holds its Trust Preferred Securities promptly and instruct such DTC
Participant to provide Consents on such beneficial owner's behalf pursuant to
the procedures described herein.

As soon as practicable after the date of this Offer, DTC will deliver an
Omnibus Proxy with respect to the Trust Preferred Securities to the
Depositary. The Omnibus Proxy will assign the Consent rights of Cede & Co.,
<PAGE>
DTC's nominee that holds the Trust Preferred Securities, to the DTC
Participants to whose accounts the Trust Preferred Securities are credited on
the Record Date. In order to provide Consents pursuant to an Omnibus Proxy
on behalf of beneficial owners of Trust Preferred Securities not tendering,
each DTC Participant should complete and sign the Letter of Transmittal and
mail or deliver such Letter of Transmittal to the Depositary. Tenders by
book-entry transfer may also be made by delivering an Agent's Message in lieu
of the Letter of Transmittal and Consent. The failure of a DTC Participant to
deliver a Consent (including a "broker non-vote" resulting from the failure
of such DTC Participant to receive instructions from a beneficial owner of
Trust Preferred Securities) will have the effect of a vote against the
Proposed Amendments.

If the Requisite Consents are received with respect to the Trust
Preferred Securities, AT&T Capital, the Subsidiary Issuers, the Indenture
Trustee and the Property Trustee shall as soon as practicable (but in no
event sooner than 20 business days after the mailing of this Offer to
Purchase and Consent Solicitation) execute the Proposed Amendments. To the
extent adopted, the Proposed Amendments shall take effect immediately prior
to AT&T Capital's acceptance and payment for all Securities validly tendered
pursuant to the Offer.

A holder as of the Record Date who previously tendered Trust Preferred
Securities may not validly revoke a Consent unless such holder validly
withdraws such holder's previously tendered Trust Preferred Securities in the
manner described above under "Terms of the Offer--Withdrawal Rights." If
such withdrawal is effected before the Expiration Date, the valid withdrawal
by such holder of Trust Preferred Securities shall constitute the concurrent
valid revocation of such holder's Consent. Consents provided by holders as
of the Record Date who do not tender Trust Preferred Securities pursuant to
the Offer may be revoked by the holder providing such Consents at any time
before the Expiration Date. Consents may be revoked by delivering to the
Depositary a written notice of revocation or another form of Consent bearing
a date later than the date of the Consent.

The Proposed Amendments

The Proposed Amendments consist of the following amendments:

(a) The Limited Partnership Agreement, pursuant to which the
Partnership Preferred Securities were issued, is to be amended to
provide that (i) the Partnership may optionally redeem the Partnership
Preferred Securities on or after June 30, 1998, rather than (as
currently provided) on or after October 1, 2006, (ii) in connection with
the Offer, the Partnership shall not be required to give any advance
notice (except as provided in this Offer to Purchase and Consent
Solicitation) of the exercise of its optional redemption right
thereunder, and (iii) the Partnership will allocate to the Trust its
proportionate share of any gain realized by the Partnership on the
optional redemption of the Debentures in the manner described herein;
and

(b) The Indentures, pursuant to which the Debentures have been
issued, are to be amended to provide that (i) each of AT&T Capital and
the Subsidiary Issuers may optionally redeem their related Debentures on
or after June 30, 1998, rather than (as currently provided) on or after
September 30, 2006, and (ii) in connection with the Offer, each of AT&T
Capital and the Subsidiary Issuers shall not be required to give any
<PAGE>
advance notice (except as provided in this Offer to Purchase and Consent
Solicitation) of the exercise of its respective optional redemption
right thereunder.

The text of the Proposed Amendments are attached as Annex A to this
Offer to Purchase and Consent Solicitation and the foregoing statements in
respect thereof are summaries of the substance or general effect of certain
provisions of the Indentures, the Limited Partnership Agreement and the
Proposed Amendments and are qualified in their entirety by reference to the
Indentures, the Limited Partnership Agreement and Annex A.
Optional Redemption of Non-Tendered Securities

Concurrently with AT&T Capital's purchase of Securities tendered
pursuant to the Offer and adoption of the Proposed Amendments, AT&T Capital
will and hereby does exercise its (and will and hereby does cause each of the
Subsidiary Issuers and the Partnership to exercise their respective) optional
redemption rights under the Indentures and the Limited Partnership Agreement
(each as amended by the Proposed Amendments), which in turn will cause the
optional redemption of any and all Trust Preferred Securities that have not
been validly tendered in the Offer. Holders of Trust Preferred Securities who
do not tender their Securities in the Offer will receive the Redemption Price
of $____ per Security, plus an amount equal to any accrued and unpaid
distribution accumulated on each redeemed Security up to but not including
the Payment Date, net to the seller in cash. The Redemption Price is less
than the Purchase Price being offered by AT&T Capital for the tender of
Securities in the Offer. If holders of Securities fail to validly tender
their Securities in the Offer and, upon the terms and conditions of the
Offer, AT&T Capital accepts for payment and purchases Securities tendered
pursuant to the Offer, such non-tendering holders will only receive the
Redemption Price, plus accrued and unpaid distributions thereon, for
Securities that have not been validly tendered in the Offer.

As described under "--The Proposed Amendments," the Proposed Amendments
will permit AT&T Capital, the Subsidiary Issuers and the Partnership to
redeem their respective Debentures and the Partnership Preferred Securities
immediately upon the effectiveness of the Proposed Amendments (without any
further action required on their part).

PURPOSE OF OFFER AND CONSENT SOLICITATION

Reasons for Offer and Consent Solicitation

The purpose of the Offer is to acquire all of the issued and outstanding
Trust Preferred Securities. The purpose of the Consent Solicitation is to
cause the adoption of the Proposed Amendments. Concurrently with the
adoption of the Proposed Amendments, the Debentures and the Partnership
Preferred Securities will be optionally redeemed, which in turn will cause
the optional redemption of any and all Trust Preferred Securities that have
not been tendered in the Offer. Following the consummation of the Offer and
the Consent Solicitation in accordance with their respective terms, there
will not be any Trust Preferred Securities that remain outstanding.

As described above under "The Consent Solicitation--The Proposed
Amendments," the Trust Preferred Securities are currently subject to an
optional redemption starting in October 1, 2006. However, as further
described above under "The Consent Solicitation--Requisite Consents," the
<PAGE>
optional redemption provisions of the governing Indentures, the Limited
Partnership Agreement and the Declaration of Trust permit such optional
redemption provisions to be amended with the receipt of the Requisite
Consents from the holders of Trust Preferred Securities. AT&T Capital's
management believes that it is in the best interests of AT&T Capital and its
subsidiaries to make the Offer and the Consent Solicitation and cause the
early redemption of all of the outstanding Trust Preferred Securities,
thereby improving AT&T Capital's capital structure.

Effect of Offer and Consent Solicitation
Securities validly tendered to the Depositary pursuant to the Offer and
not withdrawn in accordance with the procedures set forth herein shall be
held until the Expiration Date (or returned to the extent the Offer is
terminated in accordance herewith). To the extent that the Proposed
Amendments are approved and the Securities tendered are accepted for payment
and paid for in accordance with the terms hereof, AT&T Capital, the
Subsidiary Issuers and the Partnership will optionally redeem the Debentures
and Partnership Preferred Securities, respectively, which in turn will cause
the optional redemption of any and all Trust Preferred Securities that have
not been tendered in the Offer. Following the consummation of the Offer and
the Consent Solicitation in accordance with their respective terms, there
will not be any Trust Preferred Securities that remain outstanding. As a
result, there will no longer be a trading market for the Trust Preferred
Securities and the Trust Preferred Securities will no longer be listed on the
NYSE.

AT&T Capital has registered the Trust Preferred Securities and the
Partnership Preferred Securities (and the related guarantees by AT&T Capital)
under the Exchange Act. In addition, AT&T Capital has qualified each of the
Declaration of Trust and the Limited Partnership Agreement (and the related
guarantees by AT&T Capital) under the Trust Indenture Act of 1939. The
consummation of the Offer and the Consent Solicitation will result in the
Trust Preferred Securities and the Partnership Preferred Securities (and the
related guarantees by AT&T Capital) becoming eligible for deregistration
under the Exchange Act. Registration of such securities may be terminated
upon application of AT&T Capital to the Commission if such securities are not
listed on a national securities exchange and there are fewer than 300 record
holders. As noted above, following the consummation of the Offer and the
Consent Solicitation, there will not be any Trust Preferred Securities
outstanding. However, AT&T Capital will continue to be subject to the
reporting requirements under the Exchange Act based on other publicly-held
debt securities of AT&T Capital remaining outstanding.

NEITHER AT&T CAPITAL, THE SUBSIDIARY ISSUERS, THE TRUST, THE
PARTNERSHIP, THEIR RESPECTIVE BOARD OF DIRECTORS OR TRUSTEES, NOR ANY OF
THEIR RESPECTIVE OFFICERS MAKES ANY RECOMMENDATION TO ANY HOLDER OF TRUST
PREFERRED SECURITIES AS TO WHETHER TO TENDER ANY OR ALL SECURITIES OR TO
CONSENT TO THE PROPOSED AMENDMENTS. EACH HOLDER MUST MAKE HIS OR HER OWN
DECISION AS TO WHETHER TO TENDER SECURITIES AND, IF SO, HOW MANY SECURITIES
TO TENDER, OR TO CONSENT TO THE PROPOSED AMENDMENTS.

PRICE RANGE OF SECURITIES; DISTRIBUTIONS

The Trust Preferred Securities are traded in the NYSE under the
symbol "TCC." The last reported sale price in the NYSE, as of the close of
business on __________ ___, 1998, was $__________.
<PAGE>
Holders of Securities are urged to obtain current market quotations for
the Securities.

The following table sets forth the high and low sales prices of
Trust Preferred Securities in the NYSE, as reported by the NYSE, and the cash
distributions paid thereon for the fiscal quarters indicated.

Distributions and Price Ranges of Trust Preferred Securities
By Quarters (1996, 1997 AND 1998)
<TABLE>
<CAPTION>

1996-Quarter 1997-Quarters 1998-Quarter
------------- ----------------------------------------------------------- ------------
4TH 1ST 2ND 3RD 4TH 1ST
------------- ----------------------------------------------------------- ------------
<S> <C> <C> <C> <C> <C> <C>

Distributions Per Security . . $0.42 $0.57 $0.57 $0.57 $0.57 $0.57
Market Price -- $ Per Security
-- High . . . . . . . . . . 26.13 26.63 26.00 27.00 27.13 27.69
-- Low . . . . . . . . . . . 24.75 25.25 24.94 25.69 25.81 26.63
</TABLE>

Distributions on Trust Preferred Securities are cumulative, accrue from
the date of initial issuance and are payable quarterly in arrears on each of
March 31, June 30, September 30, and December 31, commencing on December 31,
1996, if, as and when available for payment, by the Property Trustee, except
as otherwise described below. If distributions are not paid when scheduled,
the accrued distributions shall be paid to the holders of record of Trust
Preferred Securities as they appear on the books and records of the Trust on
the record date with respect to the payment date for the Trust Preferred
Securities which corresponds to the payment date fixed by the Partnership
with respect to the payment of cumulative distributions on the Partnership
Preferred Securities.

Distributions on the Trust Preferred Securities will be made to the
extent that the Trust has funds available for the payment of suchdistributions
in a property account of the Trust. Amounts available to the
Trust for distribution to the holder of Trust Preferred Securities are
limited to payments received by the Trust from the Partnership with respect
to the Partnership Preferred Securities (or from AT&T Capital's guarantee in
respect thereof). Distributions on the Partnership Preferred Securities are
paid only if, as and when declared in the sole discretion of AT&T Capital, as
the General Partner of the Partnership. Pursuant to the Limited Partnership
Agreement, the General Partner is not obligated to declare distributions on
the Partnership Preferred Securities at any time, including upon or following
certain partnership events.

CERTAIN FEDERAL INCOME TAX CONSEQUENCES

The following is a general discussion of the United States federal
income tax consequences of a sale or redemption of the Trust Preferred
Securities. This discussion is based on the Internal Revenue Code of 1986
(the "Code"), as well as the final, temporary and proposed Treasury
regulations promulgated thereunder, and any relevant administrative rulings
or pronouncements and judicial decisions, all as in effect on the date hereof
<PAGE>
and all of which are subject to change, possibly retroactively. The
following discussion is directed solely to beneficial owners of Trust
Preferred Securities ("Security Owners") who are United States Persons (as
defined below) and who hold their Trust Preferred Securities as capital
assets within the meaning of Section 1221 of the Code. This discussion is
only a general summary of the United States federal income tax matters
described herein and does not purport to address all of the United States
federal income tax consequences that may be relevant to a particular Security
Owner in light of that Security Owner's specific circumstances. In addition,
the following summary does not describe the United States federal income tax
consequences that may be relevant to certain types of Security Owners, such
as banks, insurance companies, regulated investment companies, real estate
investment trusts, dealers in securities or tax exempt organizations, who may
be subject to special rules or treatment under the Code. This summary also
does not discuss any alternative minimum tax consequences or any state, local
or foreign tax consequences that may be relevant to a sale or redemption of
the Trust Preferred Securities.

For purposes of this discussion, the term "United States Person" means a
Security Owner who is (i) a citizen or resident of the United States, (ii) a
corporation or partnership created or organized in the United States or under
the laws of the United States or of any state, (iii) an estate the income of
which is subject to United States federal income taxation regardless of its
source, or (iv) a trust if a court within the United States is able to
exercise primary supervision over the administration of such trust and one or
more United States Persons have the authority to control all substantial
decisions of such trust.

SECURITY OWNERS SHOULD CONSULT THEIR OWN TAX ADVISORS CONCERNING THE TAX
CONSEQUENCES TO THEM OF A SALE OR REDEMPTION OF THEIR TRUST PREFERRED
SECURITIES UNDER UNITED STATES FEDERAL INCOME TAX LAW, AS WELL AS THE LAW OF
ANY RELEVANT STATE, LOCAL OR FOREIGN JURISDICTION.

Sale of Trust Preferred Securities Pursuant to the Offer

AT&T Capital intends to take the position for United States federal
income tax purposes that the entire Purchase Price paid to tendering Security
Owners is proceeds paid to such Security Owners in respect of their Trust
Preferred Securities. If this treatment is respected for such purposes, a
Security Owner will recognize gain or loss on the sale of such Security
Owner's Trust Preferred Securities pursuant to the Offer in an amount equal
to the difference between the Purchase Price received by such Security Owner
in respect of such Trust Preferred Securities and such Security Owner's
adjusted tax basis in such Trust Preferred Securities. A Security Owner's
adjusted tax basis in its Trust Preferred Securities generally will equal the
amount such Security Owner paid for such Trust Preferred Securities, plus its
pro rata share of the Partnership income that was allocated to the Trust and
minus the amount of distributions such Security Owner has received in respect
of such Trust Preferred Securities. Generally, any gain or loss recognized
by a Security Owner on the sale of its Trust Preferred Securities will be
capital gain or loss and will be long-term capital gain or loss if the
tendering Security Owner held such Trust Preferred Securities for more than
one year immediately prior to such sale.

Redemption of Trust Preferred Securities

Security Owners should note that the Partnership will continue to
allocate to them their allocable share of Partnership net income up until the
<PAGE>
Payment Date and such Security Owners will be required to include such
amounts in gross income as ordinary income. As discussed above, a Security
Owner's adjusted tax basis in its Trust Preferred Securities will be
increased by the amount of Partnership net income that is allocated to such
Security Owner.

Although AT&T Capital intends to treat the entire Purchase Price as
proceeds paid in respect of the tendered Trust Preferred Securities, the
Internal Revenue Service ("IRS") may challenge such treatment. If the IRS
were to assert successfully that a portion of the Purchase Price was a fee
paid by AT&T Capital to Security Owners for their Consent to the Proposed
Amendments (i.e., a consent fee), Security Owners would be required to
include such recharacterized amount in gross income as ordinary income and
the amount realized by a tendering Security Owner on the sale of its Trust
Preferred Securities would be reduced accordingly.

If (i) AT&T Capital does not acquire all of the Trust Preferred
Securities pursuant to the Offer and (ii) the Proposed Amendments to the
Indenture and the Limited Partnership Agreement are adopted, AT&T Capital and
the Subsidiary Issuers will each redeem their respective Debentures for an
amount equal to the redemption price of such Debentures, plus an amount equal
to any accrued unpaid interest on such Debentures (collectively, the
"Aggregate Debenture Redemption Price"). The Partnership will realize a
long-term capital gain on such redemption to the extent that the Aggregate
Debenture Redemption Price exceeds the amount that the Partnership originally
paid for the Debentures, plus the amount of any unpaid interest accrued by
the Partnership with respect to the Debentures. The Partnership will
allocate such long-term capital gain proportionately to AT&T Capital and the
Trust, and the Security Owners will be required to recognize their pro rata
share of the long-term capital gain that is allocable to the Trust. Cash
distributions by the Partnership to the Trust in respect of its Limited
Partnership Interest, and by the Trust to the Security Owners in respect of
their Trust Preferred Securities, generally will not be separately taxable
except to the extent that the cash distributed to a Security Owner in respect
of its Trust Preferred Securities exceeds the Security Owner's adjusted tax
basis in such Trust Preferred Securities (which will have been increased by
the amount of Partnership gain and net income allocated to such Security
Owner as described above).

Backup Withholding

Proceeds from the sale of Trust Preferred Securities pursuant to the
Offer will be subject to a 31% United States federal backup withholding tax
unless the tendering Security Owner provides the Depositary with a properly
completed IRS Form W-9 (or Substitute Form W-9) or otherwise establishes an
exemption from such backup withholding.

State and Local Tax Consequences

The discussion above does not address the United States state and local
tax consequences that may be relevant to a sale or redemption of the Trust
Preferred Securities. Each Security Owner should consult with its own tax
advisor regarding these matters.
<PAGE>
SOURCE AND AMOUNT OF FUNDS

Based on the assumption that all outstanding Trust Preferred Securities
are to be purchased by AT&T Capital pursuant to the Offer, the total amount
required by AT&T Capital to purchase the Trust Preferred Securities will be
approximately $__________, including fees and other expenses. AT&T Capital
intends to fund the Offer and the Consent Solicitation (including the
optional redemption of any non-tendered Securities) from a capital
contribution to be made to AT&T Capital by its sole stockholder, Newcourt
Credit Group USA Inc., which in turn will be funded by its sole stockholder,
Newcourt Credit Group Inc. ("Newcourt"). Newcourt has recently consummated a
registered public offering of its Common Stock in the United States, with
aggregate net proceeds of approximately $391 million.

TRANSACTIONS AND AGREEMENTS CONCERNING THE SECURITIES

Based upon the records of Newcourt, AT&T Capital, the Partnership and
the Trust, and upon information provided to each of Newcourt, AT&T Capital,
the Partnership and the Trust by its respective directors, trustees and/or
executive officers, neither Newcourt, AT&T Capital, the Partnership, the
Trust nor, to the knowledge of any of them, any of their respective
subsidiaries, affiliates, directors or executive officers, or associates of
the foregoing, has engaged in any transactions involving Trust Preferred
Securities during the forty business days preceding the date hereof. Neither
Newcourt, AT&T Capital, the Partnership, the Trust nor, to the knowledge of
any of them, any of its respective directors or executive officers or an
associate of the foregoing is a party to any contract, arrangement,
understanding or relationship relating directly or indirectly to the Offer
with any other person or entity with respect to any securities of AT&T
Capital or that of the Trust.

SOLICITATION FEES, OTHER FEES AND EXPENSES

Dealer Manager Fees. Merrill Lynch will act as Dealer Manager for AT&T
Capital in connection with the Offer and the Consent Solicitation. AT&T
Capital has agreed to pay the Dealer Manager a fee equal to $0.125 per Trust
Preferred Security purchased pursuant to the Offer or otherwise prior to the
consummation of the Offer, whether or not Merrill Lynch participated in
obtaining the tender or acquisition of such Securities.

AT&T Capital will pay to each Soliciting Dealer (as defined below)
(including Merrill Lynch acting as a Soliciting Dealer) whose name has been
inserted in the space provided in the Letter of Transmittal and Consent for
that purpose a fee (the "Soliciting Dealer Fee") equal to $0.375 per Security
for each of the Trust Preferred Securities tendered, accepted for payment and
paid for pursuant to the Offer; provided, however, that with respect to
transactions for beneficial owners whose ownership equals or exceeds
10,000 Securities, AT&T Capital will only be obligated to pay a solicitation
fee of an amount equal to $0.250 per Security, of which 80% shall be paid to
Merrill Lynch and 20% to the designated Soliciting Dealer (which may be
Merrill Lynch). In cases where no Soliciting Dealer is designated, the
Dealer Manager will be paid 100% of the applicable Soliciting Dealer Fee.

"Soliciting Dealer" includes (i) any broker or dealer in securities,
including the Dealer Manager in its capacity as a broker or dealer, who is a
member of any national securities exchange or of the National Association of
<PAGE>
Securities Dealers, Inc. (the "NASD"), (ii) any foreign broker or dealer not
eligible for membership in the NASD who agrees to conform to the NASD's Rules
of Fair Practice in soliciting tenders outside the United States to the same
extent as though it were an NASD member, or (iii) any bank or trust company,
any one of whom has solicited and obtained a tender pursuant to the Offer.

Soliciting Dealers will include any of the organizations described in
clauses (i), (ii) and (iii) above even when the activities of such
organizations in connection with the Offer consist solely of forwarding to
clients materials relating to the Offer, including this Offer to Purchase and
Consent Solicitation and the applicable Letter of Transmittal and Consent,
and tendering as directed by beneficial owners thereof; provided that under
no circumstances shall any fee be paid to Soliciting Dealers more than once
with respect to any Security. No Soliciting Dealer is required to make any
recommendation to holders of Securities as to whether to tender or refrain
from tendering in the Offer. No assumption is made, in making payment to any
Soliciting Dealer, that its activities in connection with the Offer included
any activities other than those described above, and for all purposes noted
in all materials relating to the Offer, the term "solicit" shall be deemed to
mean no more than processing Securities tendered or forwarding to customers
materials regarding the Offer.

No Soliciting Dealer Fee shall be payable to a Soliciting Dealer in
respect of Securities (i) beneficially owned by such Soliciting Dealer or
(ii) registered in the name of such Soliciting Dealer unless such Securities
are being held by such Soliciting Dealer as nominee and such Securities are
being tendered for the benefit of one or more beneficial owners identified on
the accompanying Letter of Transmittal and Consent. No Soliciting Dealer Fee
shall be payable to a Soliciting Dealer if such Soliciting Dealer is required
for any reason to transfer any portion of such fee to a tendering holder
(other than itself).

The Dealer Manager will also be reimbursed by AT&T Capital for certain
reasonable out-of-pocket expenses and will be indemnified against certain
liabilities, including certain liabilities under the federal securities laws,
in connection with the Offer and Consent Solicitation. The Dealer Manager has
rendered, is currently rendering and is expected to continue to render
various investment banking and other advisory services to AT&T Capital,
Newcourt and certain of their respective affiliates. The Dealer Manager has
received, and will continue to receive, customary compensation from AT&T
Capital, Newcourt and their respective affiliates for such services.

Additional Advisors' Fees. AT&T Capital has retained First Chicago
Trust Company of New York as the Depositary and Georgeson & Company Inc. as
the Information Agent in connection with the Offer and the Consent
Solicitation. The Depositary and the Information Agent will receive
reasonable and customary compensation for their services and will also be
reimbursed for reasonable out-of-pocket expenses, including attorney fees.
Neither the Depositary nor the Information Agent has been retained to make
solicitations or recommendations in connection with the Offer.

CERTAIN INFORMATION REGARDING AT&T CAPITAL AND NEWCOURT

AT&T Capital

AT&T Capital is a full-service, diversified equipment leasing and
finance company with a presence in more than 20 countries in North America,
<PAGE>
Europe, Mexico, the Asia/Pacific Region and South America. AT&T Capital is
one of the largest equipment leasing and finance companies in the United
States and is the largest lessor of telecommunications equipment in the
United States, in each case, based on the aggregate value of equipment leased
or financed.

AT&T Capital's principal offices are located at AT&T Capital
Corporation, 44 Whippany Road, Morristown, New Jersey 07962-1983 and its
telephone number is (973) 397-4444.
For a more detailed description of the business and properties of AT&T
Capital, see the descriptions thereof set forth in AT&T Capital's Annual
Report on Form 10-K for the fiscal year ended December 31, 1997 and its
Quarterly Report on Form 10-Q for the quarterly period ended March 31, 1998,
each of which is incorporated herein by reference.

Newcourt

Newcourt is an independent financial services company which originates
and manages asset-based financings. Newcourt was formed in 1984 as an
investment bank which originated and structured asset- based financings for
the corporate and institutional asset finance market and syndicated such
financings to Canadian financial institutions. In 1988, Newcourt broadened
its activities to include vendor and direct equipment financing.

On January 12, 1998, Newcourt consummated its acquisition of all of the
issued and outstanding shares of AT&T Capital and AT&T Capital became an
indirect wholly-owned subsidiary of Newcourt. The aggregate purchase price
paid by Newcourt for the acquisition was approximately $1.6 billion. Of this
amount, approximately $1.0 billion was paid in cash and the remaining
approximately $0.6 billion was satisfied by the issuance of approximately
17.6 million common shares of Newcourt to the former owners of AT&T Capital.

AVAILABLE INFORMATION; INCORPORATION OF DOCUMENTS BY REFERENCE

AT&T Capital, the Partnership and the Trust are subject to the periodic
reporting requirements of the Exchange Act, and in accordance therewith files
reports, proxy statements and other information with the Commission. Such
reports, proxy statements and other information can be inspected and copied
at the public reference facilities maintained by the Commission at Room 1024,
Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549 and at the
Commission's regional offices at Citicorp Center, 500 West Madison Street,
Suite 1400, Chicago, Illinois 60661 and Seven World Trade Center, Suite 1300,
New York, New York 10048. Copies of such material can be obtained from the
Public Reference Section of the Commission at Judiciary Plaza, 450 Fifth
Street, N.W., Washington, D.C. 20549, at prescribed rates. Such material may
also be accessed electronically by means of the Commission's home page on the
Internet at http://www.sec.gov. Reports, proxy materials and other
information about AT&T Capital, the Partnership and the Trust are also
available at the offices of the New York Stock Exchange, 20 Broad Street, New
York, New York 10005. In connection with the Offer, AT&T Capital has filed
an Issuer Tender Offer Statement on Schedule 13E-4 with the Commission that
includes certain additional information relating to the Offer. As noted above
under "Purpose of Offer and Consent Solicitation--Effect of Offer and Consent
Solicitation," AT&T Capital will continue to be subject to the informational
requirements of the Exchange Act following the consummation of the Offer and
Consent Solicitation.
<PAGE>
The following documents filed by AT&T Capital, the Partnership and the
Trust with the Commission are incorporated herein by reference and shall be
deemed to be a part hereof:

1. AT&T Capital's Annual Report on Form 10-K for the year ended
December 31, 1997;

2. AT&T Capital's Quarterly Report on Form 10-Q for the quarterly
period ended March 31, 1998;
3. The Partnership's Annual Report on Form 10-K for the year ended
December 31, 1997;

4. The Partnership's Quarterly Report on Form 10-Q for the quarterly
period ended March 31, 1998;

5. The Trust's Annual Report on Form 10-K for the year ended December
31, 1997; and

6. The Trust's Quarterly Report on Form 10-Q for the quarterly period
ended March 31, 1998.

All documents and reports filed by AT&T Capital, the Partnership or the
Trust with the Commission pursuant to Section 13(a), 13(c), 14(a) or 15(d) of
the Exchange Act after the date of this Offer to Purchase and Consent
Solicitation and on or prior to the termination of the Offer shall be deemed
to be incorporated herein by reference and shall be deemed to be a part
hereof from the date of filing of such documents and reports. Any statement
contained in a document or report incorporated or deemed to be incorporated
by reference shall be deemed to be modified or superseded for purposes of
this Offer to Purchase and Consent Solicitation to the extent that a
statement contained herein or in any subsequently filed document or report
that also is or is deemed to be incorporated by reference herein modifies or
supersedes such statement. Any such statement so modified or superseded
shall not be deemed, except as so modified or superseded, to constitute a
part of this Offer to Purchase and Consent Solicitation.

AT&T Capital will provide without charge, upon written or oral request,
to each person to whom a copy of this Offer to Purchase and Consent
Solicitation is delivered, a copy of any of the documents of AT&T Capital,
the Partnership and the Trust (other than exhibits to such documents unless
such exhibits are specifically incorporated by reference) incorporated by
reference herein. Such requests should be directed to AT&T Capital
Corporation, 44 Whippany Road, Morristown, New Jersey 07962 or telephone:
(973) 397-4444, attention of the Investor Relations Department.

SUMMARY OF FINANCIAL INFORMATION

Set forth below is certain historical financial information of AT&T
Capital. The historical financial information (other than the ratios of
earnings to fixed charges) was derived from the audited financial statements
included in AT&T Capital's Annual Report on Form 10-K for the year ended
December 31, 1997 and from the unaudited financial statements included in the
Company's Quarterly Reports on Form 10-Q for the periods ended March 31, 1998
and March 31, 1997.
<PAGE>

<TABLE>
<CAPTION>
Year ended December 31, Three Months Ended March 31,
1996 1997 1997 1998
----------- ----------- ------------- ------------
(Thousands of Dollars, Except Ratios)
(Unaudited)
<S> <C> <C> <C> <C>
Results of Operation Data:
Total Revenues . . . . . . . . . . . . . . . . . . . . $1,952,190 $1,814,139 $ 420,930 $ 440,937
Income before extraordinary items . . . . . . . . . . . 168,539 21,007 7,428 7,258
Net Income . . . . . . . . . . . . . . . . . . . . . . $ 168,539 $ 21,007 $ 7,428 $ 7,258
Ratio of Earnings to Fixed Charges . . . . . . . . . . 1.60x 1.07x 1.11x 1.10x
</TABLE>

At December 31, At March 31,
1996 1997 1997 1998
----------- ----------- ------------- ------------
(Thousands of Dollars, Except Ratios)
(Unaudited)
<S> <C> <C> <C> <C>
Balance Sheet Data:
Total Assets . . . . . . . . . . . . . . . . . . . . . $ 8,092,512 $8,775,895 $8,027,310 $9,199,358
Total Indebtedness . . . . . . . . . . . . . . . . . . 6,464,924 7,117,994 6,590,194 7,714,683
Company-obligated preferred securities of subsidiary . 200,000 200,000 200,000 200,000
Total Shareholders' equity . . . . . . . . . . . . . . . $ 707,307 $ 743,779 $ 714,472 $ 764,039
</TABLE>

MISCELLANEOUS

The Offer is not being made to, nor will AT&T Capital accept tenders
from, owners of Securities in any jurisdiction in which the Offer or its
acceptance would not be in compliance with the laws of such jurisdiction.
AT&T Capital is not aware of any jurisdiction where the making of the Offer
or the tender of Securities would not be in compliance with applicable law.
If AT&T Capital becomes aware of any jurisdiction where the making of the
Offer or the tender of Securities is not in compliance with any applicable
law, AT&T Capital will make a good faith effort to comply with such law. If,
after such good faith effort, AT&T Capital cannot comply with such law, the
Offer will not be made to (nor will tenders be accepted from or on behalf of)
the owners of Securities residing in such jurisdiction. In any jurisdiction
in which the securities, blue sky or other laws require the Offer to be made
by a licensed broker or dealer, the Offer will be deemed to be made on AT&T
Capital's behalf by one or more registered brokers or dealers licensed under
the laws of such jurisdiction.

AT&T CAPITAL CORPORATION
<PAGE>
APPENDIX A-1

THE PROPOSED AMENDMENT TO
AT&T CAPITAL'S INDENTURE

I. The relevant provision in the Indenture of AT&T Capital relating to
optional redemption, Section 1201(a), reads as follows:
Section 1201(a) OPTIONAL REDEMPTION.

At any time on or after September 30, 2006, the Company shall
have the right to redeem the Securities, in whole or in part, from
time to time, at a Redemption Price equal to 100% of the principal
amount of Securities to be redeemed plus accrued but unpaid
interest, including any Additional Interest, if any, to the
Redemption Date.

The Proposed Amendments would amend Section 1201(a) to read as
follows:

Section 1201(a) OPTIONAL REDEMPTION.

At any time on or after June 30, 1998, the Company shall have
the right to redeem the Securities, in whole or in part, from time
to time, at a Redemption Price equal to ___% of the principal
amount of Securities to be redeemed plus accrued but unpaid
interest, including any Additional Interest, if any, to the
Redemption Date.

II. The relevant provision in the Indenture of AT&T Capital relating to
notice to the Trustee, Section 1203, reads as follows:

Section 1203 AUTHORIZATION FOR REDEMPTION;
NOTICE TO TRUSTEE.

The Proposed Amendments would amend Section 1203 to read as
follows:

Section 1203 AUTHORIZATION FOR REDEMPTION;
NOTICE TO TRUSTEE.

The election of the Company to redeem Securities pursuant to
Section 1201 shall be evidenced by a Board Resolution. In case of
any redemption, the Company shall, at least 30 days and no more
<PAGE>
than 60 days prior to the Redemption Date fixed by the Company,
notify the Trustee of such Redemption Date and of the principal
amount of Securities to be redeemed and provide a copy of the
notice of redemption given to Holders of Securities to be redeemed
pursuant to Section 1204; provided that, notwithstanding the
foregoing, if the Company optionally redeems the Securities, in
whole but not in part, in connection with the Company's Offer to
Purchase and Consent Solicitation, dated as of __________ ___, 1998
(the "Offer to Purchase and Consent Solicitation"), no advance
notice shall be given, other than as provided in the Offer to
Purchase and Consent Solicitation (which shall serve for all
purposes hereunder as a notice of redemption).

III. The relevant provision in the Indenture of AT&T Capital relating to
notice of redemption, Section 1205, reads as follows:

Section 1205 NOTICE OF REDEMPTION.

All notices of redemption shall identify the Securities to be
redeemed and shall state:

(1) the Redemption Date,

(2) the Redemption Price,

(3) that on the Redemption Date the Redemption Price will
become due and payable upon each such security to be redeemed and
that interest thereon will cease to accrue on and after said date,
and

(4) the place or places where such securities are to be
surrendered for payment of the Redemption Price.

Notice of redemption of Securities to be redeemed at the
election of the Company shall be given by the Company or, at the
Company's request, by the Trustee in the name and at the expense of
the Company.

The Proposed Amendments would amend Section 1205 to read as
follows:

Section 1205 NOTICE OF REDEMPTION.

Notice of redemption shall be given by first-class mail,
postage prepaid, mailed not less than 30 nor more than 60 days
prior to the Redemption Date, to each Holder of Securities to be
redeemed, at his address appearing in the Security Register;
provided that, notwithstanding the foregoing, if the Company
optionally redeems the Securities, in whole but not in part, in
connection with the Company's Offer to Purchase and Consent
Solicitation, no advance notice shall be given other than as
<PAGE>
provided in the Offer to Purchase and Consent Solicitation (which
shall serve for all purposes hereunder as a notice of redemption).

All notices of redemption shall identify the Securities to be
redeemed and shall state:

(1) the Redemption Date,

(2) the Redemption Price,
(3) that on the Redemption Date the Redemption Price will
become due and payable upon each such security to be redeemed and
that interest thereon will cease to accrue on and after said date,
and

(4) the place or places where such securities are to be
surrendered for payment of the Redemption Price.

I. The relevant provision in the Indentures of AT&T Capital Services
Corporation ("AT&T Capital Services") and AT&T Capital Leasing
Corporation ("AT&T Capital Leasing") relating to optional redemption,
Section 1201(a), reads as follows:
Section 1201(a) OPTIONAL REDEMPTION.

At any time on or after October 25, 2006, the Company shall
have the right to redeem the Securities, in whole or in part, from
time to time, at a Redemption Price equal to 100% of the principal
amount of Securities to be redeemed plus accrued but unpaid
interest, including any Additional Interest, if any, to the
Redemption Date.

The Proposed Amendments would amend Section 1201(a) to read as
follows:

Section 1201(a) OPTIONAL REDEMPTION.

II. The relevant provision in the Indentures of AT&T Capital Services
and AT&T Capital Leasing relating to notice to the Trustee, Section
1204, reads as follows:

Section 1204 AUTHORIZATION FOR REDEMPTION;
NOTICE TO TRUSTEE.

The Proposed Amendments would amend Section 1203 to read as
follows:
<PAGE>
Section 1203 AUTHORIZATION FOR REDEMPTION;
NOTICE TO TRUSTEE.

The election of the Company to redeem Securities pursuant to
Section 1201 and the mandatory redemption required pursuant to
Section 1202 shall be evidenced by a Board Resolution. In case of
any redemption, the Company shall, at least 30 days and no more
than 60 days prior to the Redemption Date fixed by the Company,
notify the Trustee of such Redemption Date and of the principal
amount of Securities to be redeemed and provide a copy of the
notice of redemption given to Holders of Securities to be redeemed
pursuant to Section 1205; provided that, notwithstanding the
foregoing, if the Company optionally redeems the Securities, in
whole but not in part, in connection with the Guarantor's Offer to
Purchase and Consent Solicitation, dated as of __________ ___, 1998
(the "Offer to Purchase and Consent Solicitation"), no advance
notice shall be given, other than as provided in the Offer to
Purchase and Consent Solicitation (which shall serve for all
purposes hereunder as a notice of redemption).

III. The relevant provision in the Indentures of AT&T Capital Services
and AT&T Capital Leasing relating to notice of redemption, Section 1206,
reads as follows:

Section 1206 NOTICE OF REDEMPTION.

All notices of redemption shall identify the Securities to be
redeemed and shall state:

(1) the Redemption Date,

(2) the Redemption Price,

(3) that on the Redemption Date the Redemption Price will
become due and payable upon each such security to be redeemed and
that interest thereon will cease to accrue on and after said date,
and

(4) the place or places where such securities are to be
surrendered for payment of the Redemption Price.

The Proposed Amendments would amend Section 1206 to read as
follows:
<PAGE>
Section 1206 NOTICE OF REDEMPTION.

Notice of redemption shall be given by first-class mail,
postage prepaid, mailed not less than 30 nor more than 60 days
prior to the Redemption Date, to each Holder of Securities to be
redeemed, at his address appearing in the Security Register;
provided that, notwithstanding the foregoing, if the Company
optionally redeems the Securities, in whole but not in part, in
connection with the Company's Offer to Purchase and Consent
Solicitation, no advance notice shall be given other than as
provided in the Offer to Purchase and Consent Solicitation (which
shall serve for all purposes hereunder as a notice of redemption).

All notices of redemption shall identify the Securities to be
redeemed and shall state:

(1) the Redemption Date,

(2) the Redemption Price,

(3) that on the Redemption Date the Redemption Price will
become due and payable upon each such security to be redeemed and
that interest thereon will cease to accrue on and after said date,
and

(4) the place or places where such securities are to be
surrendered for payment of the Redemption Price.

I. The provision in the Limited Partnership Agreement relating to
allocations of profits and losses to partners, Section 4.1(a), reads as
follows:

Section 4.1(a) PROFITS AND LOSSES.
The Partnership's Net Income for each Fiscal Period of the
Partnership shall be allocated as follows:

(i) First, to each Holder of a Partnership Preferred Security
in an amount equal to the excess, if any, of (x) all Net Losses, if
any, allocated to each such Holder from the date of issuance of the
Partnership Preferred Security through and including the close of
such Fiscal Period pursuant to Section 4.1(b)(ii) below over (y)
the amount of Net Income, if any, allocated to each such Holder
pursuant to this Section 4.1(a)(i) in all prior Fiscal Periods.

(ii) Second, to the Holders of the Partnership Preferred
Securities, an amount of Net Income equal to the excess of (x) the
Distributions accrued on the Partnership Preferred Securities from
the date of their issuance through and including the last day of
such Fiscal Period, including any Compounded Distributions payable
with respect thereto, over (y) the amount of Net Income allocated
to the Holders of the Partnership Preferred Securities pursuant to
this Section 4.1(a)(ii) in all prior Fiscal Periods. Amounts
allocated to all Partnership Preferred Security Holders shall be
allocated among such Holders in proportion to the number of
Partnership Preferred Securities held by such Holders.

(iii) Any remaining Net Income shall be allocated to the
General Partner.

The Proposed Amendments would amend Section 4.1(a) to read as
follows:

The Partnership's Net Income for each Fiscal Period of the
Partnership shall be allocated as follows:

(ii) Second, to the Holders of the Partnership Preferred
Securities, an amount of Net Income equal to the excess of (x) the
Distributions accrued on the Partnership Preferred Securities from
the date of their issuance through and including the last day of
such Fiscal Period, including any Compounded Distributions payable
with respect thereto, over (y) the amount of Net Income allocated
<PAGE>
to the Holders of the Partnership Preferred Securities pursuant to
this Section 4.1(a)(ii) in all prior Fiscal Periods. Amounts
allocated to all Partnership Preferred Security Holders shall be
allocated among such Holders in proportion to the number of
Partnership Preferred Securities held by such Holders; and

(iii) Any remaining Net Income shall be allocated to the
General Partner;

; provided that, notwithstanding the foregoing, the Partnership will allocate
to the Holders of Partnership Preferred Securities their proportionate share
of any gain realized by the Partnership upon a redemption of any of the
Debentures

II. The provision in the Limited Partnership Agreement relating to
optional redemption, Section 6.2(c), reads as follows:

Section 6.2(c) OPTIONAL REDEMPTION.

Partnership Preferred Securities shall be redeemable at the
option of the General Partner, in whole or in part, from time to
time, on or after October 1, 2006, upon not less than 30 nor more
than 60 days' notice, at an amount per Partnership Preferred
Securities equal to $25 plus accrued and unpaid Distributions
thereon, including any Compounded Distributions (the "Redemption
Price"). The Partnership may not redeem the Partnership Preferred
Securities in part unless all accumulated and unpaid Distributions,
including any Compounded Distributions, have been paid in full on
all Partnership Preferred Securities for all Fiscal Periods
terminating on or prior to the date of redemption. If a partial
redemption of the Partnership Preferred Securities would result in
the delisting of the Trust Preferred Securities (or, if the Trust
is liquidated in connection with a Trust Special Event, the
delisting of the Partnership Preferred Securities), the Partnership
may only redeem the Partnership Preferred Securities in whole but
not in part.

The Proposed Amendments would amend Section 6.2(c) to read as
follows:

Section 6.2(c) OPTIONAL REDEMPTION.

Partnership Preferred Securities shall be redeemable at the
option of the General Partner, in whole or in part, from time to
time, on or after June 30, 1998, upon not less than 30 nor more
than 60 days' notice (except to the extent otherwise permitted
pursuant to the proviso to the first sentence of Section
6.2(e)(i)), at an amount per Partnership Preferred Security equal
to $25 plus accrued and unpaid Distributions thereon, including any
Compounded Distributions (the "Redemption Price"). The Partnership
may not redeem the Partnership Preferred Securities in part unless
all accumulated and unpaid Distributions, including any Compounded
Distributions, have been paid in full on all Partnership Preferred
Securities for all Fiscal Periods terminating on or prior to the
date of redemption. If a partial redemption of the Partnership
Preferred Securities would result in the delisting of the Trust
<PAGE>
Preferred Securities (or, if the Trust is liquidated in connection
with a Trust Special Event, the delisting of the Partnership
Preferred Securities), the Partnership may only redeem the
Partnership Preferred Securities in whole but not in part.

III. The relevant provision in the Limited Partnership Agreement
relating to redemption procedures, Section 6.2(e)(i), reads as follows:

Section 6.2(e)(i) REDEMPTION PROCEDURES.
Notice of any redemption of Partnership Preferred Securities
(a "Redemption Notice") will be given by the Partnership by mail to
each Holder of Partnership Preferred Securities to be redeemed not
fewer than 30 nor more than 60 days before the date fixed for
redemption. For purposes of the calculation of the date of
redemption and the dates on which notices are given pursuant to
this Section 6.2(e)(i), a Redemption Notice shall be deemed to be
given on the day such notice is first mailed, by first-class mail,
postage prepaid, to Holders of Partnership Preferred Securities.
Each Redemption Notice shall be addressed to the Holders of
Partnership Preferred Securities at the address of each such Holder
appearing in the books and records of the Partnership. No defect
in the Redemption Notice or in the mailing thereof with respect to
any Holder shall affect the validity of the redemption proceedings
with respect to any other Holder.

The Proposed Amendments would amend Section 6.2(e)(i) to read as
follows:

Section 6.2(e)(i) REDEMPTION PROCEDURES.

Notice of any redemption of Partnership Preferred Securities
(a "Redemption Notice") will be given by the Partnership by mail to
each Holder of Partnership Preferred Securities to be redeemed not
fewer than 30 nor more than 60 days before the date fixed for
redemption; provided that, notwithstanding the foregoing, in
connection with the Company's Offer to Purchase and Consent
Solicitation, the General Partner may optionally redeem the
Partnership Preferred Securities in whole but not in part, without
any advance notice, other than as provided in the Offer to Purchase
and Consent Solicitation (which shall serve for all purposes
hereunder as the "Redemption Notice"). For purposes of the
calculation of the date of redemption and the dates on which
notices are given pursuant to this Section 6.2(e)(i), a Redemption
Notice shall be deemed to be given on the day such notice is first
mailed, by first-class mail, postage prepaid, to Holders of
Partnership Preferred Securities. Each Redemption Notice shall be
addressed to the Holders of Partnership Preferred Securities at the
address of each such Holder appearing in the books and records of
the Partnership. No defect in the Redemption Notice or in the
mailing thereof with respect to any Holder shall affect the
validity of the redemption proceedings with respect to any other
Holder.
<PAGE>
Facsimile copies of the Letter of Transmittal and Consent will not be
accepted. The Letter of Transmittal and Consent and, if applicable,
certificates for Securities should be sent or delivered by each tendering
holder of Trust Preferred Securities or his or her broker, dealer, bank or
trust company to the Depositary at one of its addresses set forth below.

The Depositary for the Offer is:

First Chicago Trust Company of New York
By Mail: By Hand: By Overnight
Courier:
First Chicago Trust First Chicago Trust First Chicago
Company Company Trust Company
of New York of New York of New York
Tenders & Exchanges Tenders & Exchanges Tenders &
Suite 4660 c/o The Depository Trust Exchanges
P.O. Box 2569 Company Suite 4680
Jersey City, New Jersey 55 Water Street, DTC TAD 14 Wall Street,
07303-2569 Vietnam Veterans Memorial 8th Floor
Plaza New York, New York
New York, New York 10041 10005

If by facsimile
transmission:
(For Eligible
Institutions only)
(201) 222-4720
or
(201) 222-4721
Facsimile confirmation
number:
(201) 222-4707

Any questions or requests for assistance may be directed to the
Information Agent or the Dealer Manager at their respective telephone
numbers and addresses listed below. Requests for additional copies of
this Offer to Purchase and Consent Solicitation, the Letter of
Transmittal and Consent or other tender offer or proxy materials may
be directed to the Information Agent, and such copies will be
furnished promptly at AT&T Capital's expense. Holders of Trust
Preferred Securities may also contact their local broker, dealer,
commercial bank or trust company for assistance concerning the Offer.

The Information Agent for the Offer is:

Georgeson & Company Inc.

Wall Street Plaza
New York, New York 10005
(800) 223-2064 (toll free)
Banks and Brokers call collect:
(212) 440-9800
<PAGE>
The Dealer Manager for the Offer is:

Merrill Lynch & Co.
World Financial Center-North Tower
250 Vesey Street
New York, New York 10281-1307
1 (888) ML4-TNDR (toll free)
(1-888-654-8637)