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SOLAR FINANCIAL SERVICES ENTERS INTO LETTER OF INTENT WITH GENERAL ELECTRIC CAPITAL CORPORATION

 SOLAR FINANCIAL SERVICES ENTERS INTO LETTER OF INTENT
 WITH GENERAL ELECTRIC CAPITAL CORPORATION
 MIAMI, Aug. 31 /PRNewswire/ -- Solar Financial Services, Inc. (NASDAQ: SOFI) (the "company") announces that the company has entered into a letter of intent (the "letter of intent") with General Electric Capital Corporation ("GE Capital") whereby GE Capital has agreed, subject to certain conditions precedent (the "conditions") to provide to the company a two year (with an automatic one year renewal period unless either party terminates within 90 days of an anniversary date) revolving line of credit in the principal amount of up to the lower of (i) $20 million; or (ii) an amount equal to 80 percent of the principal balance of the company's vehicle retail installment contracts (the "installment contracts") determined by GE Capital to be eligible for advance. The letter of intent provides for the GE financing to be delivered to the company at an interest rate equal to 650 basis points over LIBOR. Any advances to be made by GE Capital to the company will be secured by the company's assets, including the company's receivables generated under the installment contracts.
 The conditions include, among other things, GE Capital's satisfactory due diligence review of, among other things, the company's underwriting, credit criteria, and servicing and collection operations. In addition, the conditions require that GE Capital approve the company's credit and financial condition. The letter of intent states that GE Capital's due diligence review of the company will commence upon the company's delivery of $20,000 to GE Capital, $5,000 of which has been delivered to date. Based on information received from the company, the company believes GE Capital's due diligence review of the company will commence during the second week of September 1992. Accordingly, the company presently intends to deliver to GE Capital the additional $15,000 on or before Sept. 7, 1992.
 The company anticipates using the funds received from GE Capital to (i) refinance an approximate $11.4 million obligation to its primary lender due Jan. 31, 1993; (ii) retire other financial commitments, including an existing $700,000 obligation required to be satisfied by Sept. 15, 1992; and (iii) for working capital. There can be no assurance that the company will be able to procure the financing from GE Capital, or if procured, that such financing will be acquired timely to enable the company to meet its obligations.
 The company is primarily engaged in the sale of used automobiles, vans and lights trucks, operating three used car lots in the Dade and Broward County, Florida markets. The company also operates a finance company that finances the sale of used vehicles and a vehicle service company.
 A copy of the company's current report on Form 8-K filed with the Securities and Exchange Commission, Washington on Aug. 31, 1992 is available at the company's headquarters in Miami and is incorporated by reference herein.
 -0- 8/31/92
 /CONTACT: David Pavsner, president and CEO, or Laurence B. Hankin, vice president and chief financial officer, both of Solar Financial Services, 305-835-1160/
 (SOFI) CO: Solar Financial Services, Inc.; General Electric Capital
 Corporation ST: Florida IN: SU:


AW-JB -- FL007 -- 4886 08/31/92 10:35 EDT
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Publication:PR Newswire
Date:Aug 31, 1992
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