Avalon Correctional Services, Inc. Announces $18 Million Credit Facility.

OKLAHOMA CITY--(BUSINESS WIRE)--March 2, 1999--Avalon Correctional Services, Inc. (NASDAQ: CITY), announced today it has successfully secured an $18 million loan from Fleet Capital. The new loan is a four-year revolving credit facility primarily utilized to finance the expansion of the Company's business in owning and operating community corrections facilities.

"We are pleased to have completed this credit facility," said Donald E. Smith, Avalon Chairman and CEO. "This credit agreement displays the confidence that the financial community has in Avalon and in its management. In the last fifteen months we have secured a total of $37 million in senior debt and equity that will assist Avalon in reaching its strategic goals."

Legg Mason Wood Walker served as the placement agent for Avalon.

Avalon Correctional Services, Inc. is a leading developer and manager of privatized community correctional facilities in the United States. Avalon provides a diverse range of programs and services to local, state, and federal government agencies.

Certain statements in this release constitute forward-looking statements or statements which may be deemed or construed to be forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The words "forecast," "estimate," "project," "intend," "expect," "should," "would," and similar expressions and all statements which are not historical facts are intended to identify forward-looking statements. These forward-looking statements involve and are subject to known and unknown risks, uncertainties and other factors which could cause the Company's actual results, performance (financial or operating) or achievements to differ from the future results, performance (financial or operating) or achievements expressed or implied by such forward-looking statements. The above factors are more fully discussed in the Company's SEC filings.