Customer Installs of Award-Winning Press Commence in Chicago, London, Los Angeles, New York, Paris, Washington, D.C. CHICAGO, Oct. 7, 2002 – Delivering its most significant technology platform in a decade, Xerox Corporation (NYSE: XRX) today announced the availability of its ground-breaking DocuColor iGen3 Digital Production Press, effective this month in six major markets across the United States and Europe. The company also announced pricing plans designed to help graphic arts providers develop new business opportunities and revenue streams. As part of the announcement, commercial printing customers who have served as iGen3 test sites shared their experiences for the first time and showcased award-winning print jobs that rival the quality of traditional offset printing. "Beneath the surface of the iGen3 lies the result of digital printing expertise Xerox has gained since founding the on-demand printing marketing more than 12 years ago with our DocuTech family of production systems," said Frank D. Steenburgh, senior vice president and general manager, Xerox DocuColor iGen3 Business. "The iGen3 technology platform delivers a whole new world of revenue-generating color applications." Mercury Print Production, a commercial printer with 150 employees in Rochester, N.Y., has been testing the iGen3 for more than six months as part of its 24-hour, 7-day operation. "The quality is amazing. We knew it would be good, but we were surprised the machine’s color gamut allows us to easily print colors that we couldn’t print on offset equipment," said John Place, president, Mercury Print Production. "It has the best performance I’ve ever seen on coated stocks with a digital press. I anticipate growing volume to at least 700,000 prints per month." He cited Mercury’s success using iGen3 to produce customized children’s books, full-color catalogs and other applications. Mercury already has won two prestigious awards for work printed on the iGen3: the International Association of Printing House Craftsman’s (IAPHC) Best of the Best Award for Emerging Technology and NAPCO’s Bronze Golden Ink Award for Direct-to-Press Digital Imaging. "Xerox understands this is a press and is providing the right kind of support," Place pointed out. Xerox has created new service and support programs to ensure that DocuColor iGen3 customers are fully leveraging the press’ capabilities. SmartPress Production Consultants serve as part of a team of Xerox color production specialists available to work with product owners to help build revenue-generating volume and maximize business models potential. They are being provided at no cost for the first two months for early DocuColor iGen3 installs. According to Roger Gimbel, another early iGen3 user, industry expert and president of New York City-based Xerographic Reproduction Center, a division of Global Document Solutions, "I expected the iGen3 to be a real workhorse with outstanding quality. What impressed me is Xerox’s ability and commitment in keeping the machine running while providing additional people-based services to help train, advise and support my business. Xerox has a major focus on helping its customers develop their business — from business models to volume-building programs and innovative solutions in such areas as 1:1 and digital books. It’s way beyond what other vendors are doing." Pricing and Delivery With U.S. list prices starting at $510,000, the 100 page-per-minute DocuColor iGen3 provides unparalleled speed, productivity, image quality and paper-handling capabilities. Pricing programs for service and consumables were announced at Graph Expo: - Two full-service maintenance plans are immediately available, one for high volume and one for lower volumes, which include ongoing service by Xerox technicians. Under these plans, the customer will have the option of purchasing consumables by the container or by metered impressions. - A "no click" plan is planned for 2003, under which the customer will pay for certain parts and all consumables, and assume responsibility for pre-specified maintenance tasks. Customers will be given the option of switching to the no-click plan when it becomes available. Page costs including equipment, service and consumables run as low as a breakthrough 3.4 cents per 8.5" x 11" print, based on area of coverage and average monthly volume. With the launch of iGen3, Xerox is also announcing new paper products to meet the industry’s growing digital printing needs. The new Xerox qualified and developed stocks include Digital Color Xpressions and Digital Color Gloss papers in 80 lb. and 100 lb. weights. The new papers are immediately available for customer applications made possible by iGen3’s advanced printing technology. During Graph Expo, Xerox will take orders for the DocuColor iGen3. A phased roll-out in Chicago, London, Los Angeles, New York, Paris, and Washington D.C. will be followed by expansion to additional North American and European markets in 2003. At Graph Expo Xerox is featuring three DocuColor iGen3 presses printing live at its Graph Expo booth. The booth is organized into four quadrants – Digital Print Shop, 1:1 Marketing, On Demand Publishing, and Business Development – with each area designed to help customers focus on revenue generation and profitability. Applications being showcased include posters, catalogs, books, brochures and 1:1 jobs. In addition to the DocuColor iGen3, the company also is showcasing about 20 pieces of equipment, including its DocuColor, DocuTech and DocuPrint printers and presses. Xerox software, services, supplies and partner solutions also are being demonstrated.