Jo-Ann Stores Announces New $365 Million Senior Secured Credit Facilities

Apr 25, 2001, 01:00 ET from Jo-Ann Stores, Inc.

    HUDSON, Ohio, April 25 /PRNewswire/ -- Jo-Ann Stores, Inc.
 (NYSE:   JAS.A and JAS.B), the leading national fabric and craft retailer with
 locations in 49 states, today announced that it has entered into new four-year
 $365 million senior secured credit facilities, agented by Fleet Retail Finance
 Inc., a subsidiary of FleetBoston Financial (NYSE:   FBF).  These credit
 facilities consist of a $325 million revolving credit facility and a $40
 million term loan facility and are secured by the inventory, receivables and
 other assets of the Company.  These facilities are replacing the Company's
 prior senior credit facility and a $40 million synthetic lease facility.  The
 prior senior credit facility had $187 million outstanding, including
 outstanding letters of credit, as of April 24.  Based on the borrowing base
 formula under the new credit facilities, the Company currently has over $90
 million of excess availability, after repaying the synthetic lease facility
 and repaying or replacing all borrowings and letters of credit outstanding
 under the prior senior credit facility.  Under the new credit facilities, the
 borrowing base formula is structured in a manner that allows the Company
 expanded availability during its seasonal inventory peaks when borrowing needs
 are greatest.
     Interest on borrowings under the credit facilities is calculated at the
 bank's base rate or London Interbank Offered Rate ("LIBOR") plus 1.75% to
 2.25%, depending on the level of excess availability that is maintained.  The
 credit facilities provide for the applicable LIBOR margin to be set at 2.00%
 for the first 12 months of the term of the facilities.  The credit facilities
 do not contain any financial covenant tests as long as excess availability, as
 defined, is greater than $35 million. A minimum net worth covenant exists if
 excess availability is less than $35 million.
     "This commitment provides us with more financial liquidity than we enjoyed
 under our prior bank facility.  We are pleased that Fleet was able to provide
 a four-year facility that more than meets our expected operating needs," said
 Alan Rosskamm, Chairman and Chief Executive Officer.  "This financing gives us
 the necessary flexibility we need to effect the turnaround effort we outlined
 last month.  At that time, we indicated we were slowing new store growth in
 order to maximize our cash flows and focus on improving the productivity of
 our existing asset base, both from an inventory and a real estate standpoint.
 We are working diligently on many fronts to accelerate the operating
 improvements necessary to create the positive momentum that will lead to
 meaningful and sustained earnings improvement by fiscal 2003."
     "We are pleased to provide Jo-Ann Stores with this financing," said Ward
 K. Mooney, President of Fleet Retail Finance.  "Jo-Ann is a leader in its
 retail niche, with a strong customer franchise."
     Jo-Ann Stores also announced it will record an extraordinary after-tax
 charge of $1.1 million, or approximately $.06 per share, in the first quarter,
 to write-off remaining deferred finance charges under the prior senior credit
 and synthetic lease facilities.
     Jo-Ann Stores, Inc. ( http://www.joann.com ), the leading national fabric
 and craft retailer with locations in 49 states, operates 928 Jo-Ann Fabrics
 and Crafts traditional stores and 58 Jo-Ann etc superstores.  The Company
 recorded sales of $1.48 billion for its fiscal year ended February 3, 2001.
     Fleet Retail Finance Inc. is one of the leading asset-based lenders in the
 country exclusively devoted to the retail industry. Fleet Retail Finance
 provides inventory-based working capital loans, long-term capital for
 expansion, turnaround financing, capital markets advisory services, global
 trade finance and cash management services. The company has agented more than
 $5.5 billion in financing to retailers across the U.S., Canada and the UK.
 Fleet Retail Finance is a subsidiary of FleetBoston Financial, a $200 billion
 diversified financial services company and the seventh-largest financial
 holding company in the United States. FleetBoston Financial offers a
 comprehensive array of innovative financial solutions to 20 million customers
 in more than 20 countries and territories. FleetBoston Financial is
 headquartered in Boston and listed on the New York Stock Exchange (NYSE:   FBF)
 and the Boston Stock Exchange (BSE: FBF).
     This press release contains certain forward-looking statements, indicated
 by such words as "expects," "believes," "anticipates," "estimates," "intends,"
 "plans," and similar expressions, that are based on our current expectations,
 assumptions, estimates and projections about our Company.  As such, those
 statements are subject to significant risks and uncertainties.  These and
 other important factors may cause actual results to differ materially from
 those expressed in the forward-looking statements as discussed in the
 Company's Securities and Exchange Commission filings.
 
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SOURCE Jo-Ann Stores, Inc.
    HUDSON, Ohio, April 25 /PRNewswire/ -- Jo-Ann Stores, Inc.
 (NYSE:   JAS.A and JAS.B), the leading national fabric and craft retailer with
 locations in 49 states, today announced that it has entered into new four-year
 $365 million senior secured credit facilities, agented by Fleet Retail Finance
 Inc., a subsidiary of FleetBoston Financial (NYSE:   FBF).  These credit
 facilities consist of a $325 million revolving credit facility and a $40
 million term loan facility and are secured by the inventory, receivables and
 other assets of the Company.  These facilities are replacing the Company's
 prior senior credit facility and a $40 million synthetic lease facility.  The
 prior senior credit facility had $187 million outstanding, including
 outstanding letters of credit, as of April 24.  Based on the borrowing base
 formula under the new credit facilities, the Company currently has over $90
 million of excess availability, after repaying the synthetic lease facility
 and repaying or replacing all borrowings and letters of credit outstanding
 under the prior senior credit facility.  Under the new credit facilities, the
 borrowing base formula is structured in a manner that allows the Company
 expanded availability during its seasonal inventory peaks when borrowing needs
 are greatest.
     Interest on borrowings under the credit facilities is calculated at the
 bank's base rate or London Interbank Offered Rate ("LIBOR") plus 1.75% to
 2.25%, depending on the level of excess availability that is maintained.  The
 credit facilities provide for the applicable LIBOR margin to be set at 2.00%
 for the first 12 months of the term of the facilities.  The credit facilities
 do not contain any financial covenant tests as long as excess availability, as
 defined, is greater than $35 million. A minimum net worth covenant exists if
 excess availability is less than $35 million.
     "This commitment provides us with more financial liquidity than we enjoyed
 under our prior bank facility.  We are pleased that Fleet was able to provide
 a four-year facility that more than meets our expected operating needs," said
 Alan Rosskamm, Chairman and Chief Executive Officer.  "This financing gives us
 the necessary flexibility we need to effect the turnaround effort we outlined
 last month.  At that time, we indicated we were slowing new store growth in
 order to maximize our cash flows and focus on improving the productivity of
 our existing asset base, both from an inventory and a real estate standpoint.
 We are working diligently on many fronts to accelerate the operating
 improvements necessary to create the positive momentum that will lead to
 meaningful and sustained earnings improvement by fiscal 2003."
     "We are pleased to provide Jo-Ann Stores with this financing," said Ward
 K. Mooney, President of Fleet Retail Finance.  "Jo-Ann is a leader in its
 retail niche, with a strong customer franchise."
     Jo-Ann Stores also announced it will record an extraordinary after-tax
 charge of $1.1 million, or approximately $.06 per share, in the first quarter,
 to write-off remaining deferred finance charges under the prior senior credit
 and synthetic lease facilities.
     Jo-Ann Stores, Inc. ( http://www.joann.com ), the leading national fabric
 and craft retailer with locations in 49 states, operates 928 Jo-Ann Fabrics
 and Crafts traditional stores and 58 Jo-Ann etc superstores.  The Company
 recorded sales of $1.48 billion for its fiscal year ended February 3, 2001.
     Fleet Retail Finance Inc. is one of the leading asset-based lenders in the
 country exclusively devoted to the retail industry. Fleet Retail Finance
 provides inventory-based working capital loans, long-term capital for
 expansion, turnaround financing, capital markets advisory services, global
 trade finance and cash management services. The company has agented more than
 $5.5 billion in financing to retailers across the U.S., Canada and the UK.
 Fleet Retail Finance is a subsidiary of FleetBoston Financial, a $200 billion
 diversified financial services company and the seventh-largest financial
 holding company in the United States. FleetBoston Financial offers a
 comprehensive array of innovative financial solutions to 20 million customers
 in more than 20 countries and territories. FleetBoston Financial is
 headquartered in Boston and listed on the New York Stock Exchange (NYSE:   FBF)
 and the Boston Stock Exchange (BSE: FBF).
     This press release contains certain forward-looking statements, indicated
 by such words as "expects," "believes," "anticipates," "estimates," "intends,"
 "plans," and similar expressions, that are based on our current expectations,
 assumptions, estimates and projections about our Company.  As such, those
 statements are subject to significant risks and uncertainties.  These and
 other important factors may cause actual results to differ materially from
 those expressed in the forward-looking statements as discussed in the
 Company's Securities and Exchange Commission filings.
 
                      MAKE YOUR OPINION COUNT - Click Here
                http://tbutton.prnewswire.com/prn/11690X72138085
 
 SOURCE  Jo-Ann Stores, Inc.