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Letter to the Editor

Insurance Auto Auctions Enters into New Credit Facility

SCHAUMBURG, Ill. -- Insurance Auto Auctions, Inc., a provider of automotive salvage and claims processing services in the United States, has entered into a new five year $20 million credit facility expandable to $30 million upon syndication. This facility replaces a $20 million private placement that matured this month.

The new credit facility expands the Company's existing relationship with its primary bank partner LaSalle Bank N.A., which is a member of the ABN AMRO group. The facility is a one-year revolver that converts to a four-year term loan. The company has also entered into an interest rate swap agreement covering borrowings under the new facility, which is designed to lock in a favorable five-year rate and to serve as a hedge against future rate increases.

"We are pleased to have this credit facility in place. This new facility provides us sufficient borrowing capacity over the next five years to execute our business plan," said Scott Pettit, Chief Financial Officer. "We consider the terms of the new credit facility and swap agreements to be favorable given current market conditions."

Insurance Auto Auctions, Inc., founded in 1982, currently has 62 sites across the United States.

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