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Fidelity Holdings' Computer Business Receives State Regulatory Approval

11 November 1999

Fidelity Holdings' Computer Business Sciences Receives State Regulatory Approval of Thirty-Five Interconnection Agreements with Nine Regional Bell Operating Companies

    KEW GARDENS, N.Y.--Nov. 11, 1999--Fidelity Holdings, Inc. through its technology subsidiary, Computer Business Sciences, Inc. ("CBS"), today announced that it has finalized, and received applicable state regulatory bodies' approval for, 35 interconnection agreements with 9 Regional Bell Operating Companies ("RBOCs"), covering more than 31 states.
    These interconnection agreements permit CBS, in conjunction with its IG2, Inc. subsidiary, to purchase the unbundled network elements of, and to interconnect with, each RBOC's local exchange network.
    The Telecommunications Act of 1996 ("1996 Act") directed incumbent local exchange carriers ("ILECs", also known as "RBOCs") to make their networks available for interconnection and resale by new entrants to the local exchange market. The 1996 Act provided for interconnection and resale agreements to be negotiated and concluded by voluntary agreement. Interconnection among local networks enables all end user customers to complete calls on all networks and gives CBS access to the local loop, enabling it to distribute IG2's services to consumers.
    CBS, via its IG2, Inc. subsidiary, is preparing to deploy its services in 62 markets. CBS expects to begin rolling out its XDSL-based services shortly in the New York metropolitan area, via its interconnection and collocation arrangements with the local RBOC.
    Doron Cohen, President of Fidelity, stated: "The negotiation and establishment of interconnection agreements with the RBOCs has been a time-consuming yet crucial step in enabling us to deploy the IG2 network. These agreements permit us to access the necessary unbundled network elements ("UNEs") so that we can direct our services to the consumer. In combination with our recent Competitive Local Exchange Carrier ("CLEC") approvals, now in 24 states, we have met the regulatory hurdles, another necessary step towards preparing for deployment in most of the largest metropolitan areas in the nation. This capability is another factor to be considered as we contemplate the future of the technology division."
    Kimberly Peacock, Chief Executive Officer of IG2, Inc., added, "These agreements allow CBS to collocate its equipment alongside that of the ILEC, which will give us direct access to the copper telephone lines that already exist in the customer's home. We intend to utilize the vast capacity of current telephone wiring to create a powerful network that can provide an array of communications and entertainment services for one flat rate, all on one single bill, and all through a single pair of twisted copper wires."
    CBS presently has facilities-based CLEC approvals in Alabama, California, Colorado, Connecticut, District of Columbia, Florida, Georgia, Illinois, Indiana, Kentucky, Massachusetts, Michigan, Minnesota, Nebraska, New Jersey, New York, Ohio, Oregon, Pennsylvania, Rhode Island, Tennessee, Texas, Washington and Wisconsin. With these approvals, and in concert with the interconnection agreements with the RBOCs, CBS will be permitted to operate as a Facilities-Based Carrier of Local Telecommunications Services and Intrastate Interexchange Services in these twenty-four states, encompassing 53 of the planned rollout to 62 of the most populous cities nationwide.
    CBS's services are planned to be offered, via its IG2, Inc. subsidiary, on a multimedia network platform, IG2(TM), designed to provide a bundled package to residential and small business customers of high-speed Internet access, local and long distance telephone service, television programming, television quality video conferencing and e-Commerce capabilities, all through existing telephone wires already installed in the customer's home. Contributing to the IG2(TM) platform are a series of consumer electronic manufacturers, software developers and companies seeking additional exposure utilizing e-Commerce.
    Fidelity Holdings has been a diversified holding company that utilizes information and technology to target industries experiencing consolidation and/or deregulation. The Company operates two divisions -- Automotive and Technology. The Automotive Division operates through Major Automotive Group, a leading consolidator of automotive dealerships in the New York Metropolitan Area. The Technology Division operates under Computer Business Sciences, its IG2, Inc. subsidiary, and its plastics subsidiary. Fidelity Holdings, Inc. is presently exploring the divestiture of its non-automotive activities by way of sale, merger, consolidation or other opportunities. Accordingly, all such non-automotive activities have been classified as discontinued operations in its financial statements.
    For additional information, visit our website at www.fdhg.com, www.majorautomotive.com and www.majorworld.com.

    The information contained in this press release, including any "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 contained herein, should be reviewed in conjunction with the Company's Annual Report on Form 10-KSB and other publicly available information regarding the Company, copies of which are available from the Company upon request. Such publicly available information sets forth many risks and uncertainties related to the Company's business and such statements, including risks and uncertainties related to that are unpredictable and outside of the influence and/or control of the Company.