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Federal Deposit
Insurance Corporation

Each depositor insured to at least $250,000 per insured bank

Decisions on Bank Applications

Your:) (In Organization)


IN RE: Your:) (In Organization)
Salt Lake City, Utah
Application for Federal Deposit Insurance (Bank Insurance Fund)


The undersigned, acting under delegated authority, has fully considered all facts and information relevant to the factors of Section 6 of the Federal Deposit Insurance Act relating to the application for Federal deposit insurance for Your:) (the bank), a proposed new Utah industrial loan company to be headquartered at 5420 West 2100 South, Salt Lake City, Utah, and has concluded that the application should be approved.

Accordingly, it is hereby ORDERED, for the reasons set forth in the attached Statement, that the application submitted by the bank for federal deposit insurance be, and the same hereby is, approved subject to the following conditions:

1. That beginning paid-in-capital funds of not less than $5,974,795 shall be provided. Additionally, a ratio of Tier 1 Leverage Capital to total assets of not less than eight percent shall be maintained throughout the first three years of operation and that an adequate allowance for loan and lease losses will be provided;

2. That any changes in proposed management or proposed ownership (10 percent or more of stock), including new acquisitions of, or subscriptions to 10 percent or more of stock, will render this commitment null and void unless such proposal is approved by the Regional Director of the FDIC's San Francisco Regional Office ("Regional Director") prior to opening of the bank;

3. That the bank shall operate within the parameters of the business plan submitted to the FDIC. Furthermore, during the first three years of operations, the bank shall notify the Regional Director and the State Banking Commissioner of any proposed major deviation or material change from the submitted plan 60 days before consummation of the change;

4. That the bank obtain an audit of its financial statements annually for at least the first three years after deposit insurance is effective, and furnish a copy of any reports (including any management letters) to the Regional Director within 15 days after their receipt. Furthermore, the bank shall notify the Regional Director within 15 days when a change in its independent auditor occurs;

5. That the bank will obtain adequate fidelity coverage;

6. That Federal deposit insurance shall not become effective unless and until the applicant has been established as a state bank (not a member of the Federal Reserve System), that it has authority to conduct a banking business, and that its establishment and operation as a bank have been fully approved by appropriate State authority;

7. That until the conditional commitment herein granted becomes effective, the FDIC shall have the right to alter, suspend, or withdraw said commitment should any interim development be deemed to warrant such action; and

8. That if deposit insurance has not become effective within twelve months from the date of the ORDER, or unless, in the meantime a request for an extension of time has been approved by the FDIC, the consent granted shall expire at the end of the said twelve-month period.

Dated at Washington, D.C., this 20th day of October, 2000.

John M. Lane
Associate Director
Division of Supervision


IN RE: Your:)
Salt Lake City, Utah
Application for Federal Deposit Insurance (Bank Insurance Fund)


Pursuant to the provisions of Section 5 of the Federal Deposit Insurance Act (12 U.S.C. 1815), an application for Federal deposit insurance with membership in the Bank Insurance Fund has been filed on behalf of Your:), a proposed new Utah industrial loan company ("ILC"), to be headquartered at 5420 West 2100 South, Salt Lake City, Salt Lake County, Utah


The applicant's ultimate parent is Gateway Companies, Inc. ("Gateway"), which is a leading manufacturer and direct marketer of personal computers and related products and services. Gateway sells its products through Gateway Country retail stores and utilizes phone sales and the Internet. Gateway also offers computer-related services such as Internet Service Provider and provides various computer financing programs. These financing programs are conducted through a multi-lender consortium of unaffiliated lenders (which the applicant will replace one of). The applicant wishes to become an ILC to capture a portion of this financing opportunity, which is also in line with Gateway's strategy of diversifying its revenue base by focusing on relationship enhancing services. By virtue of having an ILC charter, the applicant will be able to export the terms and conditions of loans and other services under Utah law nationwide versus complying with fifty other non-uniform state laws, which would require separate programs. Approximately 90% of the funding for this financing program will come from cash collateral deposit accounts from Gateway

For the purposes of this proposal, the investment in fixed assets is reasonable, capital is adequate, future earnings prospects are favorable, and management is considered satisfactory. No formal objections to this application have been filed with the FDIC. Corporate powers to be exercised are consistent with the purpose of the Federal Deposit Insurance Act. No undue risk to the Bank Insurance Fund is apparent.

Accordingly, based upon a careful evaluation of all available facts and information, the Associate Director, pursuant to delegated authority, has concluded that approval of the application is warranted.


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