content: SECURITIES AND EXCHANGE COMMISSION
                               Washington, D.C. 20549
  
  
                                      FORM 8-K
  
                                   CURRENT REPORT
  
                      Filed pursuant to Section 13 or 15(d) of
                         THE SECURITIES EXCHANGE ACT OF 1934
  
                                   October 9, 1998
                           Date of Earliest Event Reported
  
  
  
                                   COMDISCO, INC.
                              (a Delaware Corporation)
                                6111 North River Road
                              Rosemont, Illinois 60018
                              Telephone (847) 698-3000
                            Commission file number 1-7725
                  I.R.S. Employer Identification Number 36-2687938
  
  
  
  
  
  <PAGE>
  
  
  
  
  
  Item 5.  Other Events
  
  Year 2000
  
  The  Securities  and  Exchange  Commission  has  issued  interpretive   guidance
  regarding  disclosure of Year 2000 issues and consequences,  effective August 4,
  1998 (the  "Interpretation").  Comdisco,  Inc.  (the  "Company")  provides  this
  disclosure to supplement the information  contained in its 1997 Annual Report on
  Form 10K and  subsequent  quarterly  reports on Form 10Q in accordance  with the
  Interpretation.
  
  This  document  contains  historical  information,  as well as  forward  looking
  statements  within the meaning of the "safe  harbor"  provisions  of the Private
  Securities  Litigation  Reform  Act  of  1995,   particularly  in  reference  to
  statements  regarding the Company's  expectations  with respect to the Company's
  plans and objectives for  assessment  and  remediation of Year 2000 issues;  the
  expected  costs  associated  with  assessment,   remediation  and  testing;  the
  Company's  contingency  plans;  the Company's  expectations  with respect to its
  operations at Year 2000; and other forward looking statements.  In addition, one
  can generally identify forward looking statements by the use of terminology such
  as "may," "will," "expect," "intend,"  "estimate,"  "anticipate,"  "believe," or
  "continue,"  as well as the  negative  thereof,  variations  thereon  or similar
  terminology.  The  Company  bases  such  statements  upon  management's  current
  expectations.  Forward-looking statements are subject to or may be impacted by a
  number of factors,  risks and  uncertainties  that could cause actual results to
  differ  materially from those described in the  forward-looking  statements.  In
  particular, give careful consideration to the cautionary statements made in this
  document.
  
  1.       Overview
  
  The  Company  has  implemented  a program to attempt  to assess,  remediate  and
  mitigate the potential impact of the "Year 2000" problem throughout the Company.
  A "Year 2000"  problem will occur where  date-sensitive  software uses two digit
  year date fields,  sorting the year 2000 ("00") before the year 1999 ("99"). The
  Year 2000 problem may result in data corruption and processing  errors occurring
  where  software,  technology  equipment,  or any other equipment or process uses
  date dependent software.
  
  The  Company's  program has been  structured  to address its  internal  computer
  systems and applications,  facilities,  equipment portfolio,  and continuity and
  network services operations. This program will include assessment and mitigation
  of Year 2000 issues with respect to information  technology and other  equipment
  that uses embedded software.  In addition,  the Company is attempting to monitor
  the Year 2000 compliance status of its vendors, suppliers, service providers and
  major  customers.  The Company  believes that it is taking the  necessary  steps
  regarding  Year 2000  compliance  with respect to matters  within its control to
  provide that Year 2000 issues will not materially impact the Company.
  
  2.       State of Readiness
  
  The Company has organized its Year 2000 project into the following subprojects:
  
        internal information systems;
        customer service delivery capabilities;
        facilities; and
        business unit impact, including third party impact and equipment portfolio
  issues.
  
  The  Company  has  approached  each  subproject  in as many as four  phases,  as
  applicable:  (1) assessment;  (2) remediation;  (3) testing; and (4) contingency
  planning.   "Assessment"   summarizes  the  process  of  issue   identification.
  "Remediation" refers to the process of taking corrective action to best mitigate
  identified  Year 2000 risks.  "Testing" is the process of  validating a specific
  Company   remediation   effort  or  confirming  a  third  party   capability  or
  certification of Year 2000 compliance.  "Contingency planning" means the process
  by which the Company  identifies an alternate course of action and/or procedures
  in the event the Company  cannot or fails to  remediate or mitigate a known Year
  2000  risk.  The  Company  may or may not  engage in  contingency  planning  for
  individual subproject components where successful Year 2000 remediation has been
  validated through the testing process or other methods.
  
           A.   Information Systems
  
           The Company has organized  its  information  systems  subproject in the
           following  areas:  (1)  Company-developed  applications  software;  (2)
           vendor applications  software;  (3) electronic data interchange trading
           partners; and (4) hardware. The Company has prioritized remediation and
           testing  activities  based  upon  the  mission-critical  nature  of the
           underlying  business  function.  The following  summarizes  the current
           status of this subproject:
  
           (1)  Company-developed software
  
           The Company plans to complete all  assessment,  remediation and testing
           activities with respect to  Company-developed  software by December 31,
           1998.
  
             (a) Mainframe. The Company has completed all assessment,  remediation
           and testing  activities  and  returned  into a  production  environment
           Company-developed mainframe applications as follows:
  
                                    Total Number Identified     Activity Completed
  
           Mainframe Modules:                6,838                           6,076
           Mainframe Database Records:         657                             491
  
           Most Company mission-critical functions are performed with applications
           software  on  mainframe  platforms,   including,   invoicing,  accounts
           receivable and contracts administration.
  
             (b) AS-400. The Company has completed all assessment, remediation and
           testing  activities and returned into a production  environment 8 of 13
           Company-developed AS-400 applications.
  
             (c)   Client-Server.   The  Company  has  completed  all  assessment,
           remediation  and testing  activities  and  returned  into a  production
           environment 46 of 94 Company-developed client-server applications.
  
           (2)   Vendor Software
  
           The Company has identified 258 vendor software packages  throughout the
           Company.  Forty of those  software  packages  have been  classified  as
           obsolete  and the Company  will  discontinue  its use of such  products
           prior to January 1, 2000. The Company has either converted or otherwise
           certified as Year 2000  compliant an additional  60 software  packages.
           The   Company   will   conduct   testing  of  mission-   and   business
           function-critical  vendor  software  packages.  The  Company  plans  to
           complete all assessment,  testing and or certification  activities with
           respect to vendor software by March 31, 1999.
  
           (3)   Electronic Data Interchange
  
           Electronic   data   interchange   ("EDI")   involves   the   electronic
           communication   and  exchange  of   information  by  two  companies  in
           accordance  with agreed upon  protocols.  A Year 2000 problem can arise
           where  either  trading  partner  does not utilize  Year  2000-compliant
           protocols  or   standards.   The  Company  plans  to  enable  the  Year
           2000-compliant  4010 EDI standard by December 31, 1998. The Company has
           sent out two mailings to all its EDI trading partners to survey trading
           partner EDI Year 2000 compliance  plans and requesting that the trading
           partners schedule  compatibility  testing during 1999. The Company will
           conduct  testing  and  migration  of its  trading  partners to the 4010
           standard  throughout  1999.  The Company will enable its EDI systems to
           accept  both  the  4010  standard  and the  current  non-compliant  EDI
           standard  to  minimize   potential   disruptions  in  the  exchange  of
           information.
  
           (4)   Hardware
  
           The Company has  completed its Year 2000  assessment of all  internally
           used and centrally  maintained  hardware,  including desktop computers.
           Replacement of  non-compliant  hardware will occur during the remainder
           of 1998 and throughout  1999.  Hardware and other equipment that is not
           centrally  maintained  will be  assessed  as part of the  scope  of the
           Company's business unit impact subproject.
  
       B.   Service Delivery Capabilities
  
  The Company  commenced  assessment of Year 2000 issues in  conjunction  with its
  business  continuity  services in April 1996 and network  services  during 1998.
  This subproject includes:
  
    *  identifying  the Year  2000  readiness  status  and  compliance  plans for
       equipment  manufacturers  and  software  vendors  of  backup  recovery  and
       infrastructure equipment used in the Company's recovery centers;
  
    *  testing such  equipment to validate Year 2000  readiness;  and to document
  
    *  progress on a periodic basis.
  
  The  business  continuity  component  of the  subproject  has been  organized by
  product line: (1) mainframe;  (2) midrange;  (3) customer network;  (4) internal
  network;  (5) workarea;  and (6) trading floor.  The Company also  separately is
  examining  the Year 2000  readiness  for the  Company's  39 business  continuity
  service facilities including infrastructure, security systems, fire suppression,
  electrical and key utilities. The hardware supporting customer subscriptions has
  generally been found to be Year 2000 capable,  if maintained at current firmware
  release levels. All critical systems supplied to customers can be made Year 2000
  compliant according to manufacturer's specifications.
  
  The Company  anticipates  this  subproject  will be  substantially  completed by
  September 1, 1999.
  
           C.   Facilities
  
  The  Company has  commenced  its  assessment  of its  general  facilities.  This
  subproject  includes  examination of the Company's  leased and owned  facilities
  Year 2000 readiness,  including an assessment of infrastructure  equipment, such
  as  elevators,  and security and HVAC  systems,  and critical  service  provider
  readiness issues,  such as that of utility  providers.  The Company has and will
  separately  examine  facility  issues  with  respect  to  its  service  delivery
  facilities as part of the Company's service delivery capability subproject.
  
  The Company has recently commenced its assessment of these facilities issues and
  currently plans to complete its preliminary  assessment  efforts by December 31,
  1998.  The Company will undertake  facilities  contingency  planning  during the
  first half of calendar year 1999.
  
  
           D.   Business Units
  
  The  Company has  commenced  assessment  of Year 2000  issues  within each of 42
  internal  business units. Each business unit will assess the impact of Year 2000
  issues  upon that  business  unit's  operational  capabilities.  Each group will
  attempt to identify,  assess and  remediate or otherwise  mitigate the impact of
  Year 2000 issues in the following  areas:  (1) software,  hardware and equipment
  outside the scope of the  information  systems  project,  including  impact upon
  portfolio  value;  (2) mission  critical  vendors;  and (3) purchasing and other
  contractual processes and procedures.
  
  The Company  anticipates that the business unit assessment will be substantially
  completed by  approximately  December 31, 1998. The Company plans to conduct any
  necessary remediation,  mitigation and/or contingency planning activities during
  the first half of calendar year 1999.
  
  
  3.       Costs
  
  Management  currently  estimates  the total  cost of its Year  2000  remediation
  efforts,  including capital expenditures,  will approximate  $21,000,000 through
  FY2000.  The Company  commenced  its Year 2000  program in 1994 and has expended
  approximately $ 10,000,000 to date as follows:
  
  FY 1994- Less than $ 100,000
  FY 1995- $2,030,000
  FY 1996- $1,628,000
  FY 1997- $2,790,000
  FY 1998- $3,420,000
  
  Management  believes that it will incur  approximately  $8,985,000 in connection
  with its Year 2000  remediation  efforts during fiscal year 1999.  Approximately
  $6,250,000  of the FY 1999  estimate has been  allocated to the  replacement  of
  identified  Year  2000  non-compliant  hardware,   software  and  infrastructure
  equipment.  The  Company  further  estimates  that it will  incur  approximately
  $2,000,000  in FY 2000.  The Company may be required to adjust its estimates for
  FY 1999 and/or FY 2000 if the Company incurs unanticipated personnel costs, must
  replace  or  accelerate  replacement  or  upgrade  of  equipment,   systems  and
  applications software as a result of Year 2000 non-compliance, or as a result of
  other currently unidentified expenses or costs associated with Year 2000 risks.
  
  The Company's Year 2000 expenditures and estimates include the Company's outside
  consultants  and  contractors,   internal  personnel  resources,  and  hardware,
  software and equipment  replacement  and upgrades  attributable to the Company's
  Year 2000 efforts.
  
  The Company's allocation of personnel resources to the Year 2000 project has not
  resulted in the deferral of any significant information technology projects. The
  Company  believes  that the Year 2000  costs  incurred  in  connection  with the
  internal information systems subproject will not exceed ten percent (10%) of the
  Company's information technology group budget during FY 1999.
  
  
  4.       Risks
  
  Management believes that Comdisco's  information technology and embedded systems
  will be  substantially  Year 2000 capable prior to the  commencement of the year
  2000.  Nevertheless,  the  Company  believes  that it may  face  potential  Year
  2000-related risk in several areas.
  
  First,  the  Company may  encounter  Year 2000 risk as a result of the Year 2000
  failure of equipment leased, sold and/or refurbished by the Company. The Company
  may face claims from  customers and their end users  arising in connection  with
  bodily injury,  property damage and business  interruption as a result of a Year
  2000  failure in  equipment  provided  by the  Company.  Based on the  Company's
  standard lease  agreement,  the Company believes that it would not be liable for
  such claims.  However,  there can be no  assurance  that such claims will not be
  bought against the Company.
  
  Second,  Year 2000 may have an impact on the Company's  estimates of fair market
  value at lease  termination,  commonly  referred  to as  "residual"  value,  for
  equipment leased to customers for which the manufacturer does not make available
  a Year  2000  compliance  upgrade  path or in the event an  available  Year 2000
  upgrade  is cost  prohibitive  relative  to the market  value of the  equipment.
  Although the Company is still in the process of evaluating  any  potential  Year
  2000 residual risks, nothing has come to the Company's attention that would lead
  it to believe that the amounts the Company will ultimately  realize would differ
  materially  from the  estimated  amounts  recorded  in the  Company's  financial
  statements.
  
  Third,  the Company may experience  intermittent  business  interruption  to its
  internal operations and service delivery capability as a result of the Company's
  suppliers,  vendors,  service providers and/or customers failing to successfully
  address their own Year 2000 issues.  While the Company exercises no control over
  such third  parties,  the  Company's  Year 2000 project  plan  includes a survey
  assessment of critical third parties response and remediation  plans to identify
  Year 2000  issues  within such  companies  and their  potential  impact upon the
  Company. The Company has no significant concentration of revenue with any single
  or group of customers.  Revenue from the Company's largest customer in 1998 does
  not exceed 2% of Comdisco's  total  revenue.  However,  if a large number of the
  Company's major  customers  encounter  operating  problems due to Year 2000 that
  results in their defaulting in their  obligations,  the Company may experience a
  material impact due to higher credit losses and lower income.
  
  
  5.       Contingency Planning
  
  The Company currently  anticipates that its information  technology and critical
  non-information  technology  systems will be Year 2000 compliant in all material
  respects.  This assessment is based upon the current  readiness of a majority of
  the  information  technology  systems  and  the  Company's  assessed  degree  of
  difficulty  associated with completing the remainder of its Year 2000 plans. The
  Company  has not yet  commenced  substantial  contingency  planning  efforts  in
  connection  with  its  Year  2000  efforts  due to  its  focus  on  its  ongoing
  assessment, remediation and testing efforts. The Company believes that effective
  contingency  planning  requires full completion of all assessment  efforts.  The
  Company  anticipates that it will engage in comprehensive  contingency  planning
  during the first half of calendar year 1999.
  
  
  
  <PAGE>
  
  
  
  
  
  SIGNATURES
  
  Pursuant  to the  requirements  of the  Securities  Exchange  Act of  1934,  the
  registrant  has duly caused this Current  Report on Form 8-K to be signed on its
  behalf by the undersigned hereunto duly authorized.
  
  
  
                                                      COMDISCO, INC.
  
  
  
  Date: October 9, 1998                          by:  /s/ John J. Vosicky
                                                      -------------------
                                                      John J. Vosicky
                                                      Executive Vice President and
                                                      Chief Financial Officer
metadata_documents: [{"type": "8-K", "sequence": "1", "description": "CURRENT REPORT", "secsgml_size_bytes": 18612}]
metadata_filer: {"company-data": {"conformed-name": "COMDISCO INC", "cik": "0000722487", "assigned-sic": "7377", "irs-number": "362687938", "state-of-incorporation": "DE", "fiscal-year-end": "0930"}, "filing-values": {"form-type": "8-K", "act": "34", "file-number": "001-07725", "film-number": "98723730"}, "business-address": {"street1": "6111 N RIVER RD", "city": "ROSEMONT", "state": "IL", "zip": "60018", "phone": "8476983000"}, "mail-address": {"street1": "6111 NOTH RIVER ROAD", "street2": "6111 NOTH RIVER ROAD", "city": "ROSEMONT", "state": "IL", "zip": "60018"}}
text: SECURITIES AND EXCHANGE COMMISSION
                               Washington, D.C. 20549
  
                                      FORM 8-K
  
                                   CURRENT REPORT
  
                      Filed pursuant to Section 13 or 15(d) of
                         THE SECURITIES EXCHANGE ACT OF 1934
  
                                   October 9, 1998
                           Date of Earliest Event Reported
  
                                   COMDISCO, INC.
                              (a Delaware Corporation)
                                6111 North River Road
                              Rosemont, Illinois 60018
                              Telephone (847) 698-3000
                            Commission file number 1-7725
                  I.R.S. Employer Identification Number 36-2687938
  Item 5.  Other Events
  
  Year 2000
  
  The  Securities  and  Exchange  Commission  has  issued  interpretive   guidance
  regarding  disclosure of Year 2000 issues and consequences,  effective August 4,
  1998 (the  "Interpretation").  Comdisco,  Inc.  (the  "Company")  provides  this
  disclosure to supplement the information  contained in its 1997 Annual Report on
  Form 10K and  subsequent  quarterly  reports on Form 10Q in accordance  with the
  Interpretation.
  
  This  document  contains  historical  information,  as well as  forward  looking
  statements  within the meaning of the "safe  harbor"  provisions  of the Private
  Securities  Litigation  Reform  Act  of  1995,   particularly  in  reference  to
  statements  regarding the Company's  expectations  with respect to the Company's
  plans and objectives for  assessment  and  remediation of Year 2000 issues;  the
  expected  costs  associated  with  assessment,   remediation  and  testing;  the
  Company's  contingency  plans;  the Company's  expectations  with respect to its
  operations at Year 2000; and other forward looking statements.  In addition, one
  can generally identify forward looking statements by the use of terminology such
  as "may," "will," "expect," "intend,"  "estimate,"  "anticipate,"  "believe," or
  "continue,"  as well as the  negative  thereof,  variations  thereon  or similar
  terminology.  The  Company  bases  such  statements  upon  management's  current
  expectations.  Forward-looking statements are subject to or may be impacted by a
  number of factors,  risks and  uncertainties  that could cause actual results to
  differ  materially from those described in the  forward-looking  statements.  In
  particular, give careful consideration to the cautionary statements made in this
  document.
  
  1.       Overview
  
  The  Company  has  implemented  a program to attempt  to assess,  remediate  and
  mitigate the potential impact of the "Year 2000" problem throughout the Company.
  A "Year 2000"  problem will occur where  date-sensitive  software uses two digit
  year date fields,  sorting the year 2000 ("00") before the year 1999 ("99"). The
  Year 2000 problem may result in data corruption and processing  errors occurring
  where  software,  technology  equipment,  or any other equipment or process uses
  date dependent software.
  
  The  Company's  program has been  structured  to address its  internal  computer
  systems and applications,  facilities,  equipment portfolio,  and continuity and
  network services operations. This program will include assessment and mitigation
  of Year 2000 issues with respect to information  technology and other  equipment
  that uses embedded software.  In addition,  the Company is attempting to monitor
  the Year 2000 compliance status of its vendors, suppliers, service providers and
  major  customers.  The Company  believes that it is taking the  necessary  steps
  regarding  Year 2000  compliance  with respect to matters  within its control to
  provide that Year 2000 issues will not materially impact the Company.
  
  2.       State of Readiness
  
  The Company has organized its Year 2000 project into the following subprojects:
  
        internal information systems;
        customer service delivery capabilities;
        facilities; and
        business unit impact, including third party impact and equipment portfolio
  issues.
  
  The  Company  has  approached  each  subproject  in as many as four  phases,  as
  applicable:  (1) assessment;  (2) remediation;  (3) testing; and (4) contingency
  planning.   "Assessment"   summarizes  the  process  of  issue   identification.
  "Remediation" refers to the process of taking corrective action to best mitigate
  identified  Year 2000 risks.  "Testing" is the process of  validating a specific
  Company   remediation   effort  or  confirming  a  third  party   capability  or
  certification of Year 2000 compliance.  "Contingency planning" means the process
  by which the Company  identifies an alternate course of action and/or procedures
  in the event the Company  cannot or fails to  remediate or mitigate a known Year
  2000  risk.  The  Company  may or may not  engage in  contingency  planning  for
  individual subproject components where successful Year 2000 remediation has been
  validated through the testing process or other methods.
  
           A.   Information Systems
  
           The Company has organized  its  information  systems  subproject in the
           following  areas:  (1)  Company-developed  applications  software;  (2)
           vendor applications  software;  (3) electronic data interchange trading
           partners; and (4) hardware. The Company has prioritized remediation and
           testing  activities  based  upon  the  mission-critical  nature  of the
           underlying  business  function.  The following  summarizes  the current
           status of this subproject:
  
           (1)  Company-developed software
  
           The Company plans to complete all  assessment,  remediation and testing
           activities with respect to  Company-developed  software by December 31,
           1998.
  
             (a) Mainframe. The Company has completed all assessment,  remediation
           and testing  activities  and  returned  into a  production  environment
           Company-developed mainframe applications as follows:
  
                                    Total Number Identified     Activity Completed
  
           Mainframe Modules:                6,838                           6,076
           Mainframe Database Records:         657                             491
  
           Most Company mission-critical functions are performed with applications
           software  on  mainframe  platforms,   including,   invoicing,  accounts
           receivable and contracts administration.
  
             (b) AS-400. The Company has completed all assessment, remediation and
           testing  activities and returned into a production  environment 8 of 13
           Company-developed AS-400 applications.
  
             (c)   Client-Server.   The  Company  has  completed  all  assessment,
           remediation  and testing  activities  and  returned  into a  production
           environment 46 of 94 Company-developed client-server applications.
  
           (2)   Vendor Software
  
           The Company has identified 258 vendor software packages  throughout the
           Company.  Forty of those  software  packages  have been  classified  as
           obsolete  and the Company  will  discontinue  its use of such  products
           prior to January 1, 2000. The Company has either converted or otherwise
           certified as Year 2000  compliant an additional  60 software  packages.
           The   Company   will   conduct   testing  of  mission-   and   business
           function-critical  vendor  software  packages.  The  Company  plans  to
           complete all assessment,  testing and or certification  activities with
           respect to vendor software by March 31, 1999.
  
           (3)   Electronic Data Interchange
  
           Electronic   data   interchange   ("EDI")   involves   the   electronic
           communication   and  exchange  of   information  by  two  companies  in
           accordance  with agreed upon  protocols.  A Year 2000 problem can arise
           where  either  trading  partner  does not utilize  Year  2000-compliant
           protocols  or   standards.   The  Company  plans  to  enable  the  Year
           2000-compliant  4010 EDI standard by December 31, 1998. The Company has
           sent out two mailings to all its EDI trading partners to survey trading
           partner EDI Year 2000 compliance  plans and requesting that the trading
           partners schedule  compatibility  testing during 1999. The Company will
           conduct  testing  and  migration  of its  trading  partners to the 4010
           standard  throughout  1999.  The Company will enable its EDI systems to
           accept  both  the  4010  standard  and the  current  non-compliant  EDI
           standard  to  minimize   potential   disruptions  in  the  exchange  of
           information.
  
           (4)   Hardware
  
           The Company has  completed its Year 2000  assessment of all  internally
           used and centrally  maintained  hardware,  including desktop computers.
           Replacement of  non-compliant  hardware will occur during the remainder
           of 1998 and throughout  1999.  Hardware and other equipment that is not
           centrally  maintained  will be  assessed  as part of the  scope  of the
           Company's business unit impact subproject.
  
       B.   Service Delivery Capabilities
  
  The Company  commenced  assessment of Year 2000 issues in  conjunction  with its
  business  continuity  services in April 1996 and network  services  during 1998.
  This subproject includes:
  
    *  identifying  the Year  2000  readiness  status  and  compliance  plans for
       equipment  manufacturers  and  software  vendors  of  backup  recovery  and
       infrastructure equipment used in the Company's recovery centers;
  
    *  testing such  equipment to validate Year 2000  readiness;  and to document
  
    *  progress on a periodic basis.
  
  The  business  continuity  component  of the  subproject  has been  organized by
  product line: (1) mainframe;  (2) midrange;  (3) customer network;  (4) internal
  network;  (5) workarea;  and (6) trading floor.  The Company also  separately is
  examining  the Year 2000  readiness  for the  Company's  39 business  continuity
  service facilities including infrastructure, security systems, fire suppression,
  electrical and key utilities. The hardware supporting customer subscriptions has
  generally been found to be Year 2000 capable,  if maintained at current firmware
  release levels. All critical systems supplied to customers can be made Year 2000
  compliant according to manufacturer's specifications.
  
  The Company  anticipates  this  subproject  will be  substantially  completed by
  September 1, 1999.
  
           C.   Facilities
  
  The  Company has  commenced  its  assessment  of its  general  facilities.  This
  subproject  includes  examination of the Company's  leased and owned  facilities
  Year 2000 readiness,  including an assessment of infrastructure  equipment, such
  as  elevators,  and security and HVAC  systems,  and critical  service  provider
  readiness issues,  such as that of utility  providers.  The Company has and will
  separately  examine  facility  issues  with  respect  to  its  service  delivery
  facilities as part of the Company's service delivery capability subproject.
  
  The Company has recently commenced its assessment of these facilities issues and
  currently plans to complete its preliminary  assessment  efforts by December 31,
  1998.  The Company will undertake  facilities  contingency  planning  during the
  first half of calendar year 1999.
  
           D.   Business Units
  
  The  Company has  commenced  assessment  of Year 2000  issues  within each of 42
  internal  business units. Each business unit will assess the impact of Year 2000
  issues  upon that  business  unit's  operational  capabilities.  Each group will
  attempt to identify,  assess and  remediate or otherwise  mitigate the impact of
  Year 2000 issues in the following  areas:  (1) software,  hardware and equipment
  outside the scope of the  information  systems  project,  including  impact upon
  portfolio  value;  (2) mission  critical  vendors;  and (3) purchasing and other
  contractual processes and procedures.
  
  The Company  anticipates that the business unit assessment will be substantially
  completed by  approximately  December 31, 1998. The Company plans to conduct any
  necessary remediation,  mitigation and/or contingency planning activities during
  the first half of calendar year 1999.
  
  3.       Costs
  
  Management  currently  estimates  the total  cost of its Year  2000  remediation
  efforts,  including capital expenditures,  will approximate  $21,000,000 through
  FY2000.  The Company  commenced  its Year 2000  program in 1994 and has expended
  approximately $ 10,000,000 to date as follows:
  
  FY 1994- Less than $ 100,000
  FY 1995- $2,030,000
  FY 1996- $1,628,000
  FY 1997- $2,790,000
  FY 1998- $3,420,000
  
  Management  believes that it will incur  approximately  $8,985,000 in connection
  with its Year 2000  remediation  efforts during fiscal year 1999.  Approximately
  $6,250,000  of the FY 1999  estimate has been  allocated to the  replacement  of
  identified  Year  2000  non-compliant  hardware,   software  and  infrastructure
  equipment.  The  Company  further  estimates  that it will  incur  approximately
  $2,000,000  in FY 2000.  The Company may be required to adjust its estimates for
  FY 1999 and/or FY 2000 if the Company incurs unanticipated personnel costs, must
  replace  or  accelerate  replacement  or  upgrade  of  equipment,   systems  and
  applications software as a result of Year 2000 non-compliance, or as a result of
  other currently unidentified expenses or costs associated with Year 2000 risks.
  
  The Company's Year 2000 expenditures and estimates include the Company's outside
  consultants  and  contractors,   internal  personnel  resources,  and  hardware,
  software and equipment  replacement  and upgrades  attributable to the Company's
  Year 2000 efforts.
  
  The Company's allocation of personnel resources to the Year 2000 project has not
  resulted in the deferral of any significant information technology projects. The
  Company  believes  that the Year 2000  costs  incurred  in  connection  with the
  internal information systems subproject will not exceed ten percent (10%) of the
  Company's information technology group budget during FY 1999.
  
  4.       Risks
  
  Management believes that Comdisco's  information technology and embedded systems
  will be  substantially  Year 2000 capable prior to the  commencement of the year
  2000.  Nevertheless,  the  Company  believes  that it may  face  potential  Year
  2000-related risk in several areas.
  
  First,  the  Company may  encounter  Year 2000 risk as a result of the Year 2000
  failure of equipment leased, sold and/or refurbished by the Company. The Company
  may face claims from  customers and their end users  arising in connection  with
  bodily injury,  property damage and business  interruption as a result of a Year
  2000  failure in  equipment  provided  by the  Company.  Based on the  Company's
  standard lease  agreement,  the Company believes that it would not be liable for
  such claims.  However,  there can be no  assurance  that such claims will not be
  bought against the Company.
  
  Second,  Year 2000 may have an impact on the Company's  estimates of fair market
  value at lease  termination,  commonly  referred  to as  "residual"  value,  for
  equipment leased to customers for which the manufacturer does not make available
  a Year  2000  compliance  upgrade  path or in the event an  available  Year 2000
  upgrade  is cost  prohibitive  relative  to the market  value of the  equipment.
  Although the Company is still in the process of evaluating  any  potential  Year
  2000 residual risks, nothing has come to the Company's attention that would lead
  it to believe that the amounts the Company will ultimately  realize would differ
  materially  from the  estimated  amounts  recorded  in the  Company's  financial
  statements.
  
  Third,  the Company may experience  intermittent  business  interruption  to its
  internal operations and service delivery capability as a result of the Company's
  suppliers,  vendors,  service providers and/or customers failing to successfully
  address their own Year 2000 issues.  While the Company exercises no control over
  such third  parties,  the  Company's  Year 2000 project  plan  includes a survey
  assessment of critical third parties response and remediation  plans to identify
  Year 2000  issues  within such  companies  and their  potential  impact upon the
  Company. The Company has no significant concentration of revenue with any single
  or group of customers.  Revenue from the Company's largest customer in 1998 does
  not exceed 2% of Comdisco's  total  revenue.  However,  if a large number of the
  Company's major  customers  encounter  operating  problems due to Year 2000 that
  results in their defaulting in their  obligations,  the Company may experience a
  material impact due to higher credit losses and lower income.
  
  5.       Contingency Planning
  
  The Company currently  anticipates that its information  technology and critical
  non-information  technology  systems will be Year 2000 compliant in all material
  respects.  This assessment is based upon the current  readiness of a majority of
  the  information  technology  systems  and  the  Company's  assessed  degree  of
  difficulty  associated with completing the remainder of its Year 2000 plans. The
  Company  has not yet  commenced  substantial  contingency  planning  efforts  in
  connection  with  its  Year  2000  efforts  due to  its  focus  on  its  ongoing
  assessment, remediation and testing efforts. The Company believes that effective
  contingency  planning  requires full completion of all assessment  efforts.  The
  Company  anticipates that it will engage in comprehensive  contingency  planning
  during the first half of calendar year 1999.
  SIGNATURES
  
  Pursuant  to the  requirements  of the  Securities  Exchange  Act of  1934,  the
  registrant  has duly caused this Current  Report on Form 8-K to be signed on its
  behalf by the undersigned hereunto duly authorized.
  
                                                      COMDISCO, INC.
  
  Date: October 9, 1998                          by:  /s/ John J. Vosicky
                                                      -------------------
                                                      John J. Vosicky
                                                      Executive Vice President and
                                                      Chief Financial Officer