OWEGO, NY, January 18th, 1999 -- Lockheed Martin Postal Systems and GATX Logistics, Inc., have formed Paxis LLC, a company that will provide a cost-effective system for shippers to deliver parcels using the U.S. Postal Service (USPS) for residential delivery. The new venture offers comprehensive parcel consolidation and distribution services to the most economical point-of-entry into the USPS delivery system primarily for the ground business-to-residential parcel transportation market. This will enable parcel mailers, including traditional shippers and a growing number of Internet-ordering customers, to take advantage of the USPS' new postage rate discounts with the USPS as the delivering carrier. Paxis services include basic parcel services of Internet-enabled track and trace, Electronic Data Interchange and parcel pickup, as well as a suite of integrated logistics services, including freight management, fulfillment and returns management. Paxis combines the automation and information technology and systems integration expertise of Lockheed Martin Postal Systems, the USPS' largest provider of technology products and services, with the integrated logistics capabilities of GATX Logistics, one of the nation's premier logistics providers. The estimated annual dollar value of the ground transportation parcel consolidation and distribution market ranges between $3.5 and $4 billion with growth projected up to $6 billion in five years. The new service is operational in January 1999, in Chicago, I11. This coincides with the implementation of the USPS' parcel rate reclassification. The Chicago facility is the first of eight strategically located facilities throughout the United States. These eight facilities will eventually comprise approximately one million square feet of parcel processing capacity. Paxis will enable mailers to capture upcoming postal discounts and improve levels of service without spending substantial funds on facilities, technology and personnel. Peter A. Jacobson is president and chief executive officer of the new venture company, which is headquartered in Jacksonville, Fla. Jacobson, formerly vice president, Business Development and Services, Lockheed Martin Postal Systems, has previous experience with the USPS as senior vice president, Processing and Distribution. "Paxis is a prime example of the strategic alliances we are initiating to expand our presence and technologies into the commercial marketplace," said Michael B. Schoultz, president, Lockheed Martin Postal Systems. "Paxis represents a win-win business proposition for both the parcel mailer and our Postal Service customer." Paxis is a strategic partnership in line with Lockheed Martin Postal Systems' diversification efforts and expanded presence in the commercial marketplace and GATX Logistics' goal for greater utilization of its facilities and transportation network, information systems and freight management capabilities. "Our new venture will offer cost savings and enhanced service features, such as Internet-enabled track and trace, to parcel mailers. Paxis looks forward to participating in the tremendous growth that electronic commerce will stimulate in parcel consolidation, distribution and delivery," said Joseph A. Nicosia, president and chief executive officer of GATX Logistics, Inc. "We are delighted to bring together our logistics expertise with Lockheed Martin's outstanding automation technology in Paxis. In addition, GATX has joined with a third party partner to provide funding for its portion of this transaction." GATX Logistics, Inc., one of North and South America's leading providers of contract logistics services, helps its broad customer base assemble, store, process and deliver its products through a wide range of integrated services. GATX Logistics is a subsidiary of Chicago-based GATX Corporation (NYSE: GMT). GATX provides more than $6 billion of service-enhanced assets primarily used to help its customers transport, store or distribute their products and services. GATX's assets include railcars and locomotives, bulk liquid terminals and pipelines, commercial aircraft, ships, warehouses, technology equipment, and other capital assets and services worldwide. Lockheed Martin Postal Systems is a leader in the design, production and systems integration of a broad product portfolio of recognition, sortation, material handling and information management systems equipment and technology for postal and commercial customers. It is part of the Electronics Platform Integration organization, which provides advanced-technology products, services and systems integration solutions. The organization is an operating unit of the Lockheed Martin Electronics Sector, a leader in the design, development and manufacture of electronics systems for the global aerospace, defense and commercial marketplace.