FOR IMMEDIATE RELEASE:
February 4, 2005

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Ian Larkin, Principal (312) 681-7400
John Cannon, Vice President (312) 681-7400
Brian Maney, Director, Corporate Communications (301) 951-6122

WAUSAU A LEADER IN 21ST CENTURY CHECK PROCESSING

By Maureen Flanagan

Wausau Financial Systems is at the forefront of changes that are reshaping the future of check processing and imaging in the U.S. Based in Mosinee, WI, the company offers comprehensive check imaging and transaction processing solutions to more than 600 commercial clients and financial institutions. The company's industry leading technology enables banks and check payment processors to streamline operations, cut costs and eliminate fraud. It also offers a winning solution as the industry shifts from manual processing of paper checks to electronic transfer.

In a February 2, 2005 transaction, Wausau was acquired by Frontenac Company, a Chicago-based private equity investment firm. In the same transaction, Frontenac also purchased Kyris Image Software, Inc., Wausau's primary licensed software developer. In support of the acquisition, American Capital Strategies, Ltd. (Nasdaq: ACAS) provided $16 million of subordinated debt and equity.

"Recent legislation ("Check 21" or the Check Clearing for the 21st Century Act) encourages banks and other check processors to embrace processing innovations that will eventually eliminate the need for presenting and collecting paper checks," said Joseph Delgadillo Wausau's CEO. "Wausau's suite of products facilitates this transition and positions the company as one of a few full-service check imaging vendors servicing this new and growing market."

Wausau was founded in 1974 to provide cash registers, accounting machines and maintenance services to financial institutions. In 1988, management bought out the company and repositioned its products and services. Through organic growth and technology fill-in acquisitions, the new owners enhanced product offerings and expanded their technology platform. Today, Wausau's fully bundled, sophisticated suite of products leads the market in its field.

ImageRPS, the core remittance processing system used by the company's commercial clients, enables checks to be read, encoded, endorsed and prepared for deposit without operator intervention. The technology has the highest character recognition rates in the industry (recognition rate above 90% with 99% accuracy) and best-in-class exception processing capabilities. The technology platform is targeted to customers who process 1,000 to 100,000 checks per day and includes insurance, telecommunication and utility companies, third-party check processors, government operations and the lockbox divisions of financial institutions. Upgrade and add-on products include archiving and analysis suites as well as accounts receivable check (ARC) conversion, which is used to perform almost 50% of all ARC conversions in the U.S.

Wausau's Optima check processing system is targeted to regional and community banks. These financial institutions install Optima in their central processing center. Bundled hardware, software and services then provide the bank with complete enterprise transaction processing capabilities. Add-on features include Check 21-related imaging modules that improve efficiency and workflow by eliminating manual check processing and human "touch points," extending from tellers to branches and ATMs.

Wausau provides customers with 24/7 support that includes access to the company's help desk, field service technicians and software upgrades. As a full-service solutions provider, the company also resells hardware such as ATMs and image processing systems.

In the February 2005 transaction, Frontenac and Delgadillo invested in equity alongside American Capital's subdebt and equity investment. Wells Fargo Foothill provided a revolving credit facility and senior financing.

Since 1997, American Capital has invested $4.7 billion in the middle market. American Capital's current portfolio of more than 100 companies represents a broad range of industries and includes several companies in the check processing and financial products industries. For more information about American Capital's portfolio click here.

Checks are expected to command a significant portion of total consumer transaction dollars in the years ahead, second only to credit cards. To meet the high demand and rising processing costs, banks and remittance processing centers are looking for innovative ways to keep costs down. With imaging technology such as Wausau's, financial services companies will be able to significantly cut costs. Analysts forecast that 98% of all commercial banks will adopt some form of check image exchange by 2008 compared to 15% today.

Check 21 legislation, which went into effect in October 2004, will accelerate the shift to electronic check processing over the next four to eight years. Wausau's imaging exchange technology will be critical as its commercial and financial clients embrace new processing solutions. Recently added customers include Bank of New York and Bank of America, highlighting Wausau's superior Check 21 technology and demonstrating its ability to penetrate the largest commercial banks. Moreover, Wausau's first mover status positions the company at the forefront of the largely untapped markets for imaging products for tellers, branches, ATMs and remote customer sites. The company's leading position also offers opportunities as additional products and services are incorporated into new processing platforms.

As Check 21 legislation transforms the industry, Wausau is leading the way for check processing and transferring technology solutions in the 21st century.