McCain’s Opposition Research – Part 36


Via or from BuzzFeed comes an opposition research file compiled by the McCain campaign in 2008.  The document is 194 pages long.  This post begins  at the top of pg 150 and ends at the  top of pg 160.

This one is very long.

I have bolded the first word in each entry for ease of reading.

OUTSOURCING AMERICAN JOBS

Under Bain Management, Stream Declined To Open Call Centers In Idaho And Wyoming As It Opened Or  Expanded Facilities In Canada, Spain, France, Ireland And India In April 2000, Stream Decided Not To Open Call Facility In Gillette, Wyoming Because Local Unemployment Was Too Low And Workers Were Too Skilled.

“The city will not be the location of a call center for Internet service providers because residents tend to be overqualified and want more pay than Stream International intended to provide. Susan Bigelow, executive director of the Campbell County Economic Development Corp., told the city council the news Wednesday. … ‘Not many of the applicants at the open house indicated a willingness to work for less than $10 per hour, which is consistent with the high skill level that was represented,’ she said.”

(“Call Center No Longer Considering Gillette,” The Associated Press, 4/13/00)

“In April, Stream International Decided Against Opening A Computer Service Call Center In Gillette Because Workers Wanted Too Much Pay And The Local Economy Was Too Healthy.”

(“Two Telecommunications Companies Now Considering Gillette,” The Associated Press, 7/12/00)

Later That Summer, Stream Declined To Open Call Center In Twin Falls, Idaho.

“Twin Falls had the telecommunications upgrades on the way. It pulled together a handsome package of incentives. And it had a site all picked out. But the city’s unemployment news was just too good to land a certain call center’s jobs for Twin Falls, which lost out to cities with higher jobless rates. Now that Dave McAlindin has a definitive ‘no’ from Stream International Inc., he consented recently to talk about the one that got away.”

(Virginia Hutchins, “Low Unemployment Rates Doom Idaho Town’s Quest To Land Telecom Call Center,” Times-News

[Twin Falls, ID], 9/19/00)

Stream’s Reasoning: Local Unemployment “Just Wasn’t High Enough.”

“[S]tream itself on Monday granted its first brief interview to The

Times-News.  ‘We were looking at the demographics of locating a contact center in your area,’ said Kathleen Nordgren, Stream’s director of public relations.  ‘But I guess the good news for you is that one of the demographics that we look at is unemployment, and unemployment just wasn’t high enough to justify the size of contact center that we would be looking to open.’”

(Virginia Hutchins, “Low Unemployment Rates Doom Idaho Town’s Quest To Land Telecom Call Center,” Times-News

[Twin Falls, ID], 9/19/00)

Local Chamber Official Said Stream Officials Were “Pretty Aloof The Whole Time, Pretty Tough To Talk To.”

“Though Stream seemed satisfied with the location package, [Twin Falls chamber executive Kent]Just said he thinks an immediately ready building could have made a difference. But he never got to talk to Stream about it. ‘They were pretty aloof the whole time, pretty tough to talk to,’ Just said. ‘We talked to them through consultants, mostly.’”

(Virginia Hutchins, “Low Unemployment Rates Doom Idaho Town’s Quest To Land Telecom Call Center,” Times-News

[Twin Falls, ID], 9/19/00)

Later That Year, Stream Announced It Would Open New Facility In La Coruna, Spain.

“To respond to the need for additional Spanish capabilities, Stream will open a customer interaction center in La Coruna, Spain, in the fourth quarter of this year. La Coruna was chosen due to the availability of customer service and technical skills in the labor force, the quality of the data and telecommunications infrastructure, and the proximity to local universities. Because La Coruna is near the Portuguese border, the site will also be able to enhance Stream’s Portuguese capabilities in Europe.”

(Stream International, Press Release, 10/12/00)

“[I]n The Second Half Of 2000, Stream Will Have Opened A Total Of 6 New Customer Interaction Centers Worldwide, In The U.S., Canada, Spain, And India.”

(Stream International, Press Release, 10/12/00)

September 2000: Stream Launched New E-Service Facility In India, Offering “Cost-Efficient” Services To Worldwide Client Base.

“Stream International … today launched its expanded e-service offering through its new Virtual Interaction Center in India. The e-services will be offered by Stream Tracmail India Ltd, a joint venture formed to provide 24×7 electronic customer service and technical support solutions to Stream’s world-class client base. … The Virtual Interaction Center in Mumbai will provide high quality, cost-efficient eCRM services initially via e-mail, and in the future, chat, collaboration and knowledge authoring.”

(Stream International, Press Release, 9/14/00)

President And COO Scott Murray:

“Our decision to expand our services to India provides clients with access to a unique labor market, which is not only highly skilled, but also has a strong work ethic. Customers will benefit from our guaranteed timely 24 hours response even though their questions are being answered from half way around the globe.”

(Stream International, Press Release, 9/14/00)

India Facility “Will Be Managed By Stream’s North American Operations.”

“Stream Tracmail India Ltd. will be managed by Stream’s North American Operations. This structure will provide Stream’s clients with the same dependable high quality services that they experience from existing operations.”

(Stream International, Press Release, 9/14/00)

March 2001: Stream Announced It Would Add Up To 300 Jobs – On Top Of 1,000 Existing Jobs – At Its Facility In Ontario, Canada.

“Stream International, Inc. … announced it will expand its operations in Belleville, Ontario, by adding capacity for up to 300 additional employees. Belleville currently hosts more than 950 employees who provide customer care and technical support using voice and Internet technologies. … According to the company, Canada is a critical component of Stream’s North American expansion plans.”

(“Canadian Expansion For Stream International,” Customer Interaction Solutions, 3/1/01)

In July 2001, Stream Selected Angers, France As Location For 200-Person Call Center.

“Stream International, a global Customer Relationship Management (CRM) outsourcing and support services provider for leading technology companies and e-businesses, today announced that it has selected Angers, France, as the location of its newest European Customer Interaction Center. Stream’s second French Center will host 200 new workstations for customer care and technical support agents using leading edge voice and Internet-based technologies.”

(Stream International, Press Release, 7/17/01)

An Existing Call Center Located Near Paris Already Employed 400 People.

“The move to Angers is a key component of Stream’s French expansion strategy. The first French center located in Velizy, near Paris,employs 400 support agents and is near capacity.”

(Stream International, Press Release, 7/17/01)

August 2001: Stream Announced Opening Of New Facility In Nova Scotia, Expected To Create Up To 900Canadian Jobs.

“Stream International … announced today that Stream has selected Glace Bay, Nova Scotia, for its next Canadian Customer Interaction Center. Once fully operational, Stream expects the Customer Interaction Center to employ up to 900 employees. Stream has begun recruiting for all levels of employment positions,including customer interaction agents, mentors, team managers and service delivery managers. The company expects to be able to fill its site management positions primarily from the local Cape Breton Region.”

(Stream International, Press Release, 8/10/01)

September 2001: Stream Opened Call Center In British Columbia, Creating Roughly 900 New Canadian Jobs.

“CRM outsourcing and support services provider Stream International opened its third Canadian customer interaction center in Chilliwack, British Columbia. At full capacity, the company expects to employ approximately900 people. … Stream expects to fill its site management positions primarily from the local Chilliwack area.”

(“Stream Online In British Columbia,” Customer  Interaction Solutions, 9/1/01)

October 2001: Stream Announced It Would Expand Its Derry Facility In Ireland, Which Already Employed More Than 600 People Providing Support For Dell And H-P Product Users.

“Stream International has announced plans to expand its workforce in Londonderry. The company is currently recruiting technical support representatives and is also looking for team managers. … The Derry operation started in January 1996 and now employs over 600 people making it the third largest employer in the city. Each day around 14,000 customer service and technical support issues are handled by telephone and e-mail for the end user customers of companies such as Dell or Hewlett Packard. Steve Moore, CEO Stream, views the Derry operation as one of the company’s key worldwide reference sites in terms of the quality of the local workforce and the world-class reputation the Derry site has developed with its clients.”

(Joe Harkin, “Northwest Focus,” Belfast Telegraph[Ireland], 10/16/01)

October 2001: Stream Formed New Business Structure To Manage Canadian Operations In Wake Of New Facilities In British Columbia, Nova Scotia And Ontario.

“Stream International, a global Customer Relationship Management (CRM) outsourcing and support services provider for leading technology companies and e-businesses, today announced a new organizational structure to lead its Canadian Management Team. …This success has resulted in the opening of two additional Canadian sites in Chilliwack, British Columbia, and Cape Breton, Nova Scotia, in the past year.”

(Stream International, Press Release, 10/10/2001)

President And COO Scott Murray Praised Company’s Plans To Expand In Canada.

“We are very excited about the success we’ve had in Canada, which has prompted the formation of this new management structure for our Canadian Operations … With over 1,000 employees currently working in Belleville and a combined 1,600 positions set to be filled in Chilliwack and Cape Breton, we felt it was necessary to put a dedicated team in place that would work to manage the day-to-day Canadian Operations.”

(Stream International,Press Release, 10/10/2001)

November 2001: Stream Announced It Would Expand Its Facility In Mumbai, India To Include Voice Support Services In Addition To Existing E-Mail Services.

“Stream International … today announced that the company will expand its capabilities to provide voice support at its Mumbai, India, site. … Stream opened its Mumbai contact center in October 2000 to handle e-mail-based customer care. In only one year, the site reached a significant milestone by handling more than one million e-mail support requests. Based on this success and an increased demand for voice services from clients,  Stream has expanded its telecommunications infrastructure in India and expects to handle voice-based support by December 2001.”

(Stream International, Press Release, 11/12/01)

Stream President And COO Scott Murray:

“We work closely with our clients to understand their needs,which is why we have developed a cost-effective way to deliver voice support via our Mumbai location … The success of our off-shore customer care solution in India illustrates our ability to use a global infrastructure to develop cost-effective solutions that also meet our clients’ needs for high-quality support.”

(Stream International,Press Release, 11/12/01)

Stream Provided Its Indian Workers With “Three Weeks Of Training On American English And Culture.”

“Stream provides each agent with three weeks of training on American English and culture, in addition to client-specific training that they receive. Stream India is linked to Stream’s North American IT infrastructure with both dedicated and virtual network connections for speed, quality, reliability and redundancy.”

(Stream International, Press Release, 11/12/01)

After Bain Capital Sold Stream International To Solectron In 2001, Company Proceeded To Shed Thousands Of American Jobs

Stream Once Employed More Than 3,000 People In Dallas, TX Area – By 2003 That Number Had Fallen To350.

“While under the Solectron umbrella, Stream had a huge Metroplex presence, at one time employing more than 3,000 in a 250,000-squarefoot building in Carrollton. That number had dropped to about 350 workers by October 2003, when the company shuttered its local operations and shipped the jobs offshore. During fiscal 2003, Stream generated an estimated $400 million in revenue for Solectron.”
(Jeff Bounds and Christine Perez, “Stream Picks Richardson For Consolidated Offices,” Dallas Business Journal, 7/16/04)
In July 2003, Stream Closed Call Center In Silver City, New Mexico And Laid Off Nearly 800 People.
“A new call center here expects to have hired 100 people by February and will employ more than 500 once the center is in full operation. Teleperformance USA of Salt Lake City, one of the largest contact center outsourcers in the country, said its call center will provide customer services for telecommunications giant Sprint. …Teleperformance will take over a building vacated when Stream International shut down its call center in July2003 after less than three years in Silver City. That shutdown cost 770 jobs.”
(“Silver City Getting New Call Center,” The Associated Press, 12/29/05)
Three Years Earlier – Under Bain Management – Stream Officials Trumpeted Possibility Of Providing Up To 1,100 New Jobs For Local Residents.
“The new call center here will triple the number of jobs it originally promised, said Michael Padilla, director of New Mexico operations for Stream International. The company said it would hire 300 when it applied for and received $1.8 million of state in-plant training funds this summer. But Padilla told the Journal on Tuesday night that Stream expects to employ 620 by the end of October and could employ 900 to 1,100 by the end of December. ‘This will be a huge diamond in the rough for Silver City,’ he said.”
(Diane Velasco, “Stream Tripling Its Hiring,” Albuquerque Journal, 9/29/00)
In August 2003, Stream Closed Call Center In Kalispell, Montana, Laying Off 330 People.
“Montana’s numbers for call centers appear decidedly in decline after suffering a huge blow when a Stream International Inc. call center in Kalispell closed last year, putting 330 people out of work.”
(Frank Jossi, “Dialing Up Call Centers,” Fed gazette, 5/1/04)
Three Years Earlier – Under Bain Management – Stream Official Boasted That Company Would Create Between 500 And 650 Jobs At Kalispell Facility.
“Renovation work on Stream International’s 60,000 square-foot call center is scheduled to be completed in late June, but already the company may have a space problem. Stream promised to provide 500 full-time jobs within three years, but it appears the firm will create substantially more jobs within months, officials said. ‘Certainly there’s a likelihood that we’ll employ more than500 people,’ said Reed Garrett, a company vice president. Stream currently employs 225 people in Kalispell,and Garrett said hiring between 500 and 650 employees by the end of the year is reasonable.”

(“Stream May Hire Between 500 And 650,” The Associated Press, 6/14/00)

Stream’s Jobs Leaving Montana Were Likely To Head “To Foreign Lands.”

“Wages might be low in Montana’s Flathead Valley, but for the folks managing Stream International, they still aren’t low enough. ‘The entire industry is moving toward lower-cost locations,’ said Bob Kula. ‘It’s the reality of the marketplace. We’re definitely restructuring our business and adding capacity outside the United States and North America.’ That is to say, when 330 Stream International jobs leave Kalispell next month, they’ll likely head to foreign lands.”

(Michael Jamison, “Stream Jobs Flow Overseas,” Missoulian [Missoula, MT], 7/11/03)

“The Shutdown Comes Just Three Years After City Leaders Granted Stream A $4 Million Incentive Package To Entice The Company To Town.”

(Michael Jamison, “Stream Jobs Flow Overseas,” Missoulian [Missoula, MT],7/11/03)

In October 2003, Stream Shuttered Its Facility In Suburban Dallas, Firing 354 People As Local Official Lamented Industry’s Move “Offshore.”

“Massachusetts-based Stream International is apparently riding the wave of technology support companies relocating jobs overseas, as the giant customer service supplier exits the Metroplex, closing its Carrollton center and laying off 354 people. … ‘I’ve been aware they were downsizing,’ [Carrollton, TX economic development official Brad] Mink said. ‘That industry is moving offshore. It’s very commonplace nowadays.’”

(Margaret Allen, “Stream International Closes, Lays Off 354,” Dallas Business Journal, 10/3/03)

Stream Had Been Major Employer In Metroplex Area For At Least Five Years.

“Mink said Stream had been in the 250,000-square foot building, formerly occupied by Texas Instruments, for five years or more.During that time, the company had consolidated and downsized its other Metroplex operations into the center.”

(Margaret Allen, “Stream International Closes, Lays Off 354,” Dallas Business Journal, 10/3/03)

In 2004, Stream Shuffled Between 100 And 200 Jobs From Oregon Into Canada.

“Stream International plans to move between 100 and 200 Beaverton call-center jobs out of the United States. … Between now and July,Stream will move 100 to 200 jobs from Beaverton to Chilliwack, B.C., company officials said Tuesday. Stream,which employs about 800 people in Beaverton, will move technical support work that it handles for Hewlett-Packard.”

(Jeff Kosseff, “Beaverton Jobs Bound For B.C.,” The Oregonian, 4/7/04)

Former Stream Employee Wade Padgett: “Their Tactics, In My Mind, Are Very Predatory, Taking Advantage Of Towns That Are Really Hurting.”

PADGETT: “They continue to look for somewhere cheaper. If the benefit of leaving outweighs the penalties, they cut and run for the next cheap labor pool. Their tactics, in my mind, are very predatory, taking advantage of towns that are really hurting. … It’s like a shell game. It lets them say they aren’t moving jobs overseas, but all the new jobs are created overseas while the jobs here are eliminated.”

(Michael Jamison, “Stream Jobs Flow Overseas,” Missoulian  [Missoula, MT], 7/11/03)

MODUS MEDIA, INC.

Bain Capital Held Controlling Stake In Outsourced Manufacturing Services Provider Modus Media, Inc.(Formerly Known As Modus Media International, Inc.) From Early 1998 Through Mid-2004

In 1997, Outsourcing Services Company Stream International – Also A Bain Capital Investment –Announced It Would Split Into Three Separate Entities, One Of Which Was Modus Media.

“But by April of1997, Stream announced it was reorganizing into three independent businesses, citing ‘marketplace assumptions that … unfolded in ways different than originally envisioned.’ While its Outsource Technical Support division would retain the Stream International name, its Outsource Manufacturing Services division would become Modus Media,a global manufacturing and fulfillment business. Its Corporate Technologies group would revert back to Corporate Software and Technology to concentrate on software resale and technology services.”

(Christa Degnan, “Net Technology Yields Midstream Split For Donnelley,” Mass High Tech, 1/5/98)

Bain Capital Assumed Full Ownership Stake In Early 1998.

“Modus spokeswoman Donna Tolley said the company is investing heavily in new facilities to fuel worldwide expansion, including operations in Ireland,Scotland and the Netherlands. … She said in the next few weeks the company will be fully-owned by Bain Capital, an original minority investor in Stream.”

(Christa Degnan, “Net Technology Yields Midstream Split For Donnelley,” Mass High Tech, 1/5/98)

Bain Capital Had Taken Control Of Modus By February 1998.

“Modus Media International, headquartered in Westwood, MA, recently completed its incorporation as an independent company. Following the ownership restructuring of Stream International Holdings Inc., a unit of R.R. Donnelley & Sons Company, Modus Media International Inc. is now a privately held corporation owned by private equity investment firm Bain Capital, Inc., Modus Media management and certain other stockholders.”

(“Modus Media Now Independent,” Tape-Disc Business, 2/98)

In March 2004, CMGI Announced It Would Purchase Modus For $230 Million In Cash/Stock.

“Former high-tech high flier CMGI Inc., now based in Charlestown, leaped back into the limelight yesterday by acquiring Modus Media Inc., a Westwood supply-chain management company, for $230 million in cash and stock. It’s a significant comeback for CMGI, a marketing company once based in Andover whose Internet venture capital business became one of the most spectacular stars of the 1990s Internet boom and a major victim of the ensuing bust.”

(Hiawatha Bray, “CMGI Buy Marks A Comeback,” The Boston Globe, 3/25/04)

Bain Capital Was “Largest Shareholder” In Modus Media.

“CMGI Inc. scraped off the dust left from the dot-com bust yesterday, unveiling a $230.5 million deal to buy rival Modus Media International Inc. that will essentially double CMGI’s revenue. … The future of the top managers at Modus, whose largest shareholder is Boston private equity firm Bain Capital, also remains unclear.”

(Jon Chesto, “CMGI Says Buy-Buy To Sidelines,” Boston Herald, 3/25/04)

CMGI’s Acquisition Of Modus Media Was Completed By August 2004.

“CMGI, Inc. (CMGI) has completed the acquisition of Modus Media, Inc. Following the acquisition, CMGI will combine the supply chain management businesses of Sales Link Corporation, a wholly-owned subsidiary of CMGI, with that of Modus Media, and the combined business will operate as Modus Link Corporation.”

(“CMGI: Completes Acquisition Of Modus Media Inc.,”Knobias.com, 8/2/04)

Modus Media Operated Outsourced Manufacturing Support Centers For Clients In The Technology Space Modus Provided “Outsourcing Services” To Tech Companies.

“Modus Media provides outsourcing services like customer order and fulfillment, packaging and hardware assembly to high-tech companies like Dell Computer Corp., Hewlett-Packard Co., IBM and Sun Microsystems Inc. It also offers e-commerce transaction processing services.”

(Kelly Holman, “Modus Media Withdraws IPO,” The Daily Deal, 8/15/00)

Modus Had “Complex” Corporate History, Originally Part Of Larger Company Also Owned By Bain Capital Before Being Spun Off As Independent Firm In 1997.

“Modus Media has a complex history. It was the documentation services division of R.R. Donnelley & Sons and in 1993 it was merged with Corporate Software Inc., a company that Bain Capital owned, to create Stream International Holdings Inc. In 1997, Stream was recapitalized instead as Modus Media International Holdings Inc. Bain earned a $1.7 million advisory fee in connection with the recapitalization, and Modus Media paid Bain $3 million in fees between 1998 and 1999.During that time, the company’s growth was minimal. Its Ebitda increased only 2.6% to $36.8 million in 1999 from$35.9 million in 1998.”

(Kelly Holman, “Modus Media Withdraws IPO,” The Daily Deal, 8/15/00)

Bain Capital Worked Closely With Modus Media On Strategic Business Planning Throughout Period Of Its Ownership Stake December 1997: Modus Chairman And CEO Terry Leahy Said He Would Be “Working Closely With Bain”On Strategic Expansion Plan.

LEAHY: “Today marks an exciting beginning for Modus Media as a well-financed,independent corporation with a strong balance sheet and a leading market position … Working closely with Bain,we move into 1998 with a clear strategic direction and capital investment plans that will continue to enhance the scope of our global supply chain management solutions for customers.”

(Modus Media International, Press Release,12/16/97)

August 2000: “Bain Capital Managing Directors Jonathan Lavine, Mark Nunnelly And Robert White Sit On Modus Media’s Board Of Directors.”

(Kelly Holman, “Modus Media Withdraws IPO,” The Daily Deal, 8/15/00)

In August 2002, Modus Hired Former Stream International President Scott Murray As CEO.

“Modus Media International, Inc. (MMI) announced today the appointment of R. Scott Murray as Chief Executive Officer. … Prior to joining MMI, Murray was President and COO of Stream International of Canton, Mass, a leading outsourcer of technical support, formerly affiliated with Modus Media. … From 1994 to 1999, Murray served as Executive Vice President and Chief Financial Officer of The Learning Company (TLC), a public company that, at the time, was one of the largest consumer software companies in the world.”

(Modus Media International, Inc., Press Release, 8/19/02)

Murray Held Senior Positions For At Least Three Bain Capital Portfolio Companies By The Age Of Forty –Including His Stint At Stream.

“Before Murray, 40, joined Modus two years ago, he was president and COO of Stream International Holdings Inc., a call center company and Bain investment that in the mid-’90s included Modus. … Prior to Stream, Murray was chief financial officer of Learning Co., an educational software company and an investment of Thomas H. Lee Co., Bain and Centre Partners Management LLC.”

(Dennis Fitzgerald and Heidi Moore, “Movers & Shakers,” The Deal, 4/5/04)

The Deal Called Murray “A Point Person” For Bain Capital “As It Deals With Its Portfolio Companies.”

“Knowing that private equity firms like to operate privately, Scott Murray, CEO of Modus Media International Inc., doesn’t want to say too much about Bain Capital LLC. But over the past several years he has emerged as a point person for the Boston-based private equity firm as it deals with its portfolio companies.”

(Dennis Fitzgerald and Heidi Moore, “Movers & Shakers,” The Deal, 4/5/04)

1997-1999: Bain Capital Received Payments Of At Least $6.2 Million From Modus Media For Services Rendered Management Agreements Resulted In Bain Capital Receiving Sum Payment Of $1.7 Million In 1999 And Annual Payments Totaling $4.5 Million From 1997-99 For “Certain Financial And Managerial Services.”

“Management Agreement: In connection with the reorganization, Modus Media paid to Bain Capital, Inc., for prior services, the sum of $1.7 million, of which $710,000 was paid in cash and $1.0 million was paid by issuance of1,722,514 shares of our common stock. Also in 1997 we entered into a management agreement with an affiliate of Bain which required us to pay a fee of $1.5 million in each of 1997, 1998 and 1999 in exchange for certain financial and managerial services. This agreement terminates upon the closing of this offering.”

(Modus Media International Holdings, Inc., SEC Form S-1, Filed 12/10/99)

Bain Capital Held Roughly 39% Of Modus’ Common Stock At Time Of IPO Filing In Dec. 1999.

“Bain Capitalis an affiliate of the Bain Capital Funds, which hold approximately 39% of our common stock. Three of our directors, Jonathan Lavine, Mark Nunnelly and Robert White, are Managing Directors of Bain Capital.”

(Modus Media International Holdings, Inc., SEC Form S-1, Filed 12/10/99)

As Of Dec. 1999, Bain Was Invested In Modus Through Bain Capital Funds IV And V.

Bain Capital Funds owned 5,024,402 shares of Modus Media’s common stock at the time of its 1999 IPO filing, including “956,826shares held by Bain Capital Fund IV, L.P., 1,094,993 shares held by Bain Capital Fund IV-B, L.P., 143,514 sharesheld by BCIP Associates, 85,220 shares held by BCIP Trust Associates, 1,021,335 shares held by Information Partners Capital Fund, L.P., and 1,722,514 shares of non-voting common stock held by Bain Capital Fund V,L.P.”

(Modus Media International Holdings, Inc., SEC Form S-1, Filed 12/10/99)

Bain Planned On Taking Modus Public, But Company Withdrew IPO Without Comment In August 2000On August 14, 2000, Modus Media Withdrew Its Planned Initial Public Offering, Giving No Explanation.

“On Monday, Modus Media, a portfolio company of Bain Capital, Inc., the Boston private equity firm, informed the Securities and Exchange Commission that it was withdrawing its eight-million-share initial public offering. The deal had been expected to price between $11 and $13 a share. The Westwood, Mass., company did not offer an explanation for the withdrawal, nor did it return calls for comment. Bain Capital, which has a 39% stake in the company, did not return calls, either.”

(Kelly Holman, “Modus Media Withdraws IPO,” The Daily Deal, 8/15/00)

Months Earlier, Modus Had Decreased Price Of Its IPO From $14-16 Per Share To $11-13 Per Share.

“With the sell-off on the Nasdaq continuing Tuesday, several IPOs that had been scheduled to price may now be delayed. … Modus Media International, a global provider of supply-chain management services for the technology industry, postponed its initial public offering until further notice. Last month, the company decreased its price from$14 to $16 down to $11 to $13 per share.”

(“MetLife, Krispy Kreme Price Shares To Tempt Non-Tech Investors,”CBSMarketWatch.com, 4/4/00)

Had IPO Gone Through, Bain Capital’s Stake In Modus Would Have Been Worth Up To $130 Million.

“Had the offering been brought, Modus Media stood to raise between $88 million and $104 million. Although BainCapital did not plan to sell any shares in the offering, its stake would be worth even more – between $110.5million and $130 million.”

(Kelly Holman, “Modus Media Withdraws IPO,” The Daily Deal, 8/15/00)

EXPORTING AMERICAN JOBS

Modus Media’s Total Workforce Declined By 27 Percent Between 2000 And 2004, When Bain Capital Owned Majority Stake In Company In July 2000, Modus Reported Having 4,800 Employees.

“Headquartered in Westwood, Massachusetts (USA), MMI is a privately held corporation with 4,800 employees and 25 Solution Centers in 13 countries.”

(Modus Media,Inc., Press Release, 7/5/00)

In March 2004, Modus Reported Employing 3,500 People – Roughly 1,300 Fewer Jobs Than Four Years Earlier.

“Modus services include end-user order management, product packaging and assembly, process and systems integration services, fulfillment and reverse logistics. Modus is headquartered in Westwood, MA and employs 3,500 people across its operations in 13 countries.”

(CMGI, Inc., Press Release, 4/24/04)

Boston Herald: “About 3,500 Employees” At Time Of 2004 Sale To CMGI.

“CMGI Inc. scraped off the dust left from the dot-com bust yesterday, unveiling a $230.5 million deal to buy rival Modus Media International Inc. that will essentially double CMGI’s revenue. … Modus has about 3,500 employees, with 50 locally.”

(Jon Chesto, “CMGISays Buy-Buy To Sidelines,” Boston Herald, 3/25/04)

Modus Media Ran Majority Of Its Facilities In China, France, Singapore And Elsewhere Around The World As Of December 1999, Modus Operated 20 “Solution Centers,” At Least 13 Of Which Were Located Abroad.

“We operate 20 solution centers worldwide with an aggregate square footage of approximately 2.0 million. All of our solution centers are leased, other than Singapore and Kildare, Ireland, which are owned.”

(ModusMedia International Holdings, Inc., SEC Form S-1, Filed 12/10/99)

In 1999, Modus Also Disclosed It Served As Minority Partner In Centers In Japan And Korea.

“In addition,we are party to two minority owned joint ventures located in Ebina, Japan and Key Heung, Korea. In addition, we maintain approximately 550 seats in our response centers within these solution centers for the resolution of questions regarding shipping, billing and technical support as well as a variety of other questions.”

(Modus Media International Holdings, Inc., SEC Form S-1, Filed 12/10/99)

Modus Media’s Business Model Was Contingent Upon Expanding Operations Outside The United States –Under Bain Capital’s Management, Overseas Revenues Grew To Account For Nearly 70% Of Company’s Total.  In 1997, Modus Made Investments To Expand Facilities In Ireland, Scotland And The Netherlands, Launch New Management Center In Ireland And Open Sales Office In Malaysia.

“In the last six months of 1997, Modus Media completed several major investments to expand and strengthen its global operations including:Facility expansions in Ireland, Scotland and The Netherlands; Technology enhancements to enhance on-demand manufacturing capabilities in Europe and the United States; Start-up of an in-house CD-ROM manufacturing facility in the United States; Launch of a multi-lingual response management center in Ireland; Opening of a sales office in Malaysia.”

(Modus Media International, Press Release, 12/16/97)

From Fiscal 1997–1999, Sales Outside North America Accounted For Roughly 55% Of Modus Media’s Total Revenue.

“We currently conduct business in Taiwan, Singapore, Ireland, the United Kingdom, the Netherlands and other foreign locations, in addition to our North American operations. Sales outside North America accounted for 54%, 55% and 54% of our total revenue for 1997, 1998 and 1999.”

(Modus Media, Inc., SEC Form S-1/A, Filed 3/8/00)

In 2000 SEC Filing, Modus Said “Our Success Depends On Our Ability To Manage And Expand Our International Operations.”

“Our growth could be limited if we are unable to manage and expand our international operations. Our success depends on our ability to manage and expand our international operations. We currently expect international revenue to account for a significant percentage of our total revenue in the future. Failure to expand our international sales and fulfillment activities could limit our ability togrow.”

(Modus Media, Inc., SEC Form S-1/A, Filed 3/8/00)

From Fiscal 2001–2003, Overseas Operations Respectively Accounted For 60%, 66% And 68% Of Modus Media’s Revenues.

“With the completion of the Modus acquisition, we currently conduct business in Mexico, China, Taiwan, Singapore, Ireland, France, The Netherlands and certain other foreign locations, in addition to our United States operations. … [S]ales outside the United States accounted for 68%, 66% and 60% of Modus’ total revenue for fiscal 2003, 2002, and 2001, respectively.”

(CMGI, Inc., Form POS AM, Filed 8/2/04)

While Under Bain Capital’s Control, Modus Closed At Least Two U.S. Facilities, Laying Off More Than 250WorkersIn June 2000, Modus Closed Its Fremont, CA Facility – Cutting 200 Jobs – While Simultaneously Opening New Facility In Guadalajara, Mexico.

“Modus Media Inc., which handles customer services and manages inventories for clients, including Microsoft Corp., said it plans to cut 200 jobs, or 4% of its work force, as it closes a plant in Fremont, Calif., to consolidate its North American operations. … The closely held company said it’s also opening a plant in Guadalajara, Mexico.”

(“Modus Media To Close Plant, Cut 200 Jobs,” Bloomberg, 6/2/00)

Modus Explained Decision To Put 200 California Workers Out Of A Job: “We Believe We Can Deliver More Cost-Effective Fulfillment Solutions For Our Clients” Elsewhere.

“As part of optimizing capacity in North America, the company will cease its Fremont, California fulfillment operations by September 1, 2000.The decision affects approximately 200 full-time and part-time employees. … ‘It is always extremely difficult from an employee perspective to close a facility, but we believe we can deliver more cost-effective fulfillment solutions for our clients through one or a combination of our other Solution Centers,’ explains [Modus COO Pat] Donnellan.”

(Modus Media, Inc., Press Release, 6/1/00)

In December 2002, Modus Announced It Would Close Its Facility In Preston, WA, Eliminating Roughly 70 Jobs.

“Modus Media International, which builds and assembles technology products for companies such as Adobe, Dell Computer and Microsoft Corp., will close a 110,000-square-foot facility in Preston next year. About 70 employees at the east King County site will lose their jobs in February, according to company spokeswoman Donna Tolley. The work — primarily software package assembly — will be transferred to the company’s operations in Raleigh, N.C.; Austin, Texas; and Lindon, Utah.”

(“Recent Layoffs At Area Technology Companies,” Seattle Post-Intelligencer,12/11/02)

Modus Media’s Expansive Operations In China Were Called “Key Attraction” After Company Was Purchased By CMGI In 2004 Modus’ Chinese Presence Called “Key Attraction” In 2004 Buyout By CMGI.

“[I]n late March, CMGI was a buyer rather than a seller, agreeing to acquire Modus Media International Inc., a supply-chain rival, for $230.5 million in stock and cash. … A key attraction of Westwood, Mass.-based Modus, which is slated to merge with Sales Link, is its presence in China.”

(Dennis Fitzgerald, “Fire Sale,” The Deal, 4/5/04)

At Time Of Sale, Modus Had Five Active Facilities In China.

“Privately held Modus, which had 2003 revenues of $534 million, has 3,500 full-time workers in 25 facilities worldwide, including five in China.”

(Hiawatha Bray, “CMG   Buy Marks A Comeback,” The Boston Globe, 3/25/04)

Modus Called “Especially Attractive” Buyout Candidate “Because Of Its Success In The Chinese Market.”

“Modus … was especially attractive to CMGI because of its success in the Chinese market. Five of Modus’s facilities are in China, where most of the world’s laptop computers are made. Modus performs supply-chain work for a number of Chinese manufacturers, including Quanta, a major producer of laptops for American computer firms. … ‘We are the largest player in China; nobody else is anywhere near the market share and footprint we have in China,’ said [Modus CEO Scott] Murray.”

(Hiawatha Bray, “CMGI Buy Marks A Comeback,” The Boston Globe, 3/25/04)

While Under Bain Control, Modus Focused On Growing Operations In Asia – Launching Major 2001Initiative To Expand Facilities In Singapore And China While Planning New Ventures In Malaysia As Of August 1998, Modus Employed 400 Workers At Its Singapore Facility.

“Global software leader Microsoft Corp has selected Singapore as its operations centre for the Asia-Pacific region … For Modus Media International, whose plant is responsible for the finished packages and documentation for much of the Microsoft software sold in Singapore, the latest development comes as a welcome respite, given the economic slowdown. ‘It’s good news for us,’ its MD and vice-president for South Asia, S K Ramadas Naidu, told BT. The 400employees of the company’s Singapore plant could now rest a little easier, he added.”

(Kenneth James, “Microsoft Picks S’pore To Be Its Asia-Pacific Ops Centre,” Business Times[Singapore], 8/15/98)

In April 2000, Modus “Expanded Its Operations In Taiwan.”

“Massachusetts-based info-tech company Modus Media Inc has expanded its operations in Taiwan by establishing a joint venture called MMI Taiwan CD Services. The venture, in which Modus has a majority stake, will function as a CD production facility and currently has two CD replication lines with an annual production capacity of 12m CD units. Later this year MMI Taiwan plans to increase the capacity to four lines providing full premastering, mastering, replication, printing and packaging capabilities.”

(“Modus Media To Produce CDs In Taiwan, Telecom World Wire, 4/25/00)

February 2001: Modus Launched $100 Million Expansion Initiative In Asia, Creating Region Hub In Singapore Announcing It Would Employ Up To 350 New Workers.

“US-based Modus Media Inc (MMI), that offers outsourced SCM solutions for the IT industry, last week launched its Asian eFulfillment Solution Centre in Singapore. This $100 million initiative – located at the Chai Chee TechnoPark – will provide a central Asia-Pacific hub to service the region with integrated supply chain solutions and will officially open in April. … The Westwood, Massachusetts-based MMI will make investments in infrastructure, technology, call centre deployment and people. ‘We expect to hire up to 350 new knowledge workers as a result of this initiative,’ [Modus spokesman Nick] Jackson said.”

(Raju Chellam, “MMI Launches $100m E-Fulfillment Centre Here,” Business Times[Singapore] 2/26/01)

“The Singapore Hub Will Be Supported By MMI’s Physical Fulfillment Centres In Penang, Shenzhen And Shanghai.”

(Raju Chellam, “MMI Launches $100m E-Fulfillment Centre Here,” Business Times [Singapore] 2/26/01)

Plan Included $5 Million Investment In Malaysian Operations.

US-based supplier of outsourced supply chain management solutions, Modus Media Inc, plans to invest US$5 million in Malaysia over the next five years. Its senior vice-president for Asia-Pacific Ramadas Naidu said the investment will be used to expand the company’sexisting fulfilment centre in Penang and to set up a sales office in Kuala Lumpur by the end of this year.”

(I-Mei Low,“Modus Media To Expand Operations,” New Straits Times [Malaysia], 2/19/01)

Modus Executive Ramadas Naidu:

“Malaysia is a high-growth zone for us and we are committed toinvesting a substantial amount there.”

(I-Mei Low, “Modus Media To Expand Operations,” New Straits Times [Malaysia],2/19/01)

Company Officials Said Regional Hub In Singapore Would Be Supported By “Additional Expansion” Of Facilities In China.

“According to MMI Asia-Pacific’s marketing director Nick Jackson, the new eFulfillment Solution Centre will provide fully Web-enabled, end-to-end integrated supply chain management solutions. …Jackson said the Singapore eFulfillment hub will be supported by MMI’s regional presence across Asean and greater China as well as additional expansion in MMI’s physical fulfilment centres in Penang, Shenzhen andShanghai.”

(I-Mei Low, “Modus Media To Expand Operations,” New Straits Times [Malaysia], 2/19/01)

As Of February 2001, Modus Reportedly Employed More Than 1,100 Workers In Asia.

“MMI’s Asianresources include over 560,000 square feet of facilities and over 1,100 employees. According to Jackson, thecompany also invested US$500 million in the Asia-Pacific on new facilities, automation and technology (designedto build on its supply chain management platform).”

(I-Mei Low, “Modus Media To Expand Operations,” New Straits Times  [Malaysia], 2/19/01)

Modus Also Had Significant Operations In Ireland, Employing Over 1,000 Local Workers There July 1999: Modus Opened New Facility In Ireland, Expanding Number Of Employees In That Country To More Than 1,000.

“Modus Media International, a global provider of supply chain management solutions to the high technology industry, recently expanded its Ireland Operations with the opening of a new Solution Center in National Technology Park in Limerick. … The opening of the Limerick Solution Center creates 200 local jobs making Modus Media one of the Top 20 employers in Ireland. The company now employs more than 1,000people across its facilities in Limerick; Willsborough; Clonshaugh; Kildare; and Eastpoint, Ireland.”

(Modus MediaInternational, Inc., Press Release, 7/23/99)

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