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Xerox Accelerates Pension Funding

Press release from the issuing company

STAMFORD, Conn.--Sept. 15, 2003-- Xerox Corporation accelerated funding to the company's U.S. pension plans by contributing $450 million this morning to its plans. The contribution represents an increase of about $325 million from what was initially scheduled for 2003. Xerox's strong operating cash flow - $841 million for the first half of the year - and the success of its recent $3.6 billion recapitalization, which included the sale of stock and notes, provided the company with the financial flexibility to accelerate its pension funding. At the end of the second quarter, Xerox's cash position was $2.3 billion. Xerox noted that its pension plans for the most recently completed plan year are now well over 100 percent funded on a current liability basis under government funding rules. By making this $450 million contribution, Xerox substantially reduces its cash funding requirements for its U.S. pension plans in 2004.