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Grant Street Group Receives Sweeping Patent Covering On-line Bond Auctions

Pittsburgh, PA (December 12, 2000)— MuniAuction, the Pittsburgh-based Internet company that pioneered electronic bond auctions, received a patent on its popular method of selling new bond issues. On December 12, 2000 the US Patent and Trademark Office issued a patent to MuniAuction, giving the firm exclusive rights to conduct (or license its method of conducting) bond auctions and investment solicitations that have the following five characteristics:

1) An Issuer of securities, 2) selling or purchasing fixed income instruments over an electronic network, 3) using an auction (or “competitive sale”) format, 4) with software that performs an interest cost calculation, 5) employing a web browser for inputing, computing, submitting, or displaying data.

MuniAuction conducted the first Internet auction of a new bond issue for the City of Pittsburgh in November 1997. Since then, the firm has conducted over 1,100 auctions exceeding $1.1 trillion in volume. “We are gratified that after 4 years and substantial expense, we have finally obtained legal protection for our invention,” said Myles Harrington, President and Co-Founder of MuniAuction. “Others have copied our methodology and used their practically unlimited financial resources to offer it for free; now, we can at least collect licensing fees or else stop infringement,” he added.

MuniAuction is currently using the patented methodology for sales of new bond and note issues as well as for solicitations of jumbo CDs and flex repurchase agreements. “We expect licensing fees to become a substantial source of revenues for MuniAuction, since our method of auctioning fixed income financial instruments will become increasingly popular as fixed income markets migrate to the Internet,” Mr. Harrington noted. This month, the firm will change its name to reflect completion of its transition from an auction service for new issues of municipal bonds to an ASP (application service provider) that both hosts auctions of financial instruments and develops customized software to support institutional sales and administration of fixed income financial instruments.