FACTORY 2-U STORES, INC. Announces Completion of $7.5 Million Debt Financing.Business Editors SAN DIEGO--(BUSINESS WIRE)--April 10, 2003 FACTORY 2-U STORES, INC inc - /ink/ increment, i.e. increase by one. Especially used by assembly programmers, as many assembly languages have an "inc" mnemonic. Antonym: dec. . (Nasdaq: FTUS FTUS Full-Time Unit Support ) today announced it has completed the previously announced $7.5 million debt financing Debt Financing When a firm raises money for working capital or capital expenditures by selling bonds, bills, or notes to individual and/or institutional investors. In return for lending the money, the individuals or institutions become creditors and receive a promise to repay with GB Retail Funding, LLC (Logical Link Control) See "LANs" under data link protocol. LLC - Logical Link Control . This debt financing consists of $6.5 million of junior subordinated debt Subordinated Debt A loan (or security) that ranks below other loans (or securities) with regard to claims on assets or earnings. Also known as "junior security" or "subordinated loan". secured primarily by inventory and a $1.0 million term loan secured primarily by equipment and other assets other assets Assets of relatively small value. For financial reporting purposes, firms frequently combine small assets into a single category rather than listing each item separately. . Bill Fields, Chairman and Chief Executive Officer, commented, "The completion of this transaction is another significant step toward completing the series of capital raising efforts we previously announced. We intend to raise another $3.0 million to $4.0 million through a sale/leaseback transaction covering distribution equipment for our new Otay Mesa, CA, distribution center by the end of May 2003. Together with this debt financing, the recent completion of an approximately $5.9 million equity financing Equity Financing The act of raising money for company activities by selling common or preferred stock to individual or institutional investors. In return for the money paid, shareholders receive ownership interests in the corporation. and the receipt of an $8.2 million federal tax refund in March, when we close the proposed sale/leaseback transaction we will have raised approximately $25 million for liquidity purposes." FACTORY 2-U STORES, INC. operates 243 "Factory 2-U" off-price retail stores which sell branded casual apparel for the family, as well as selected domestics and household merchandise at prices which generally are significantly lower than the prices offered by its discount competitors. The Company operates 32 stores in Arizona, 2 stores in Arkansas, 64 stores in southern California, 63 stores in northern California, 1 store in Idaho, 8 stores in Nevada, 9 stores in New Mexico, 1 store in Oklahoma, 15 stores in Oregon, 34 stores in Texas and 14 stores in Washington. Except for the historical information contained herein, the matters discussed in this news release are forward-looking statements that involve risks and uncertainties, and actual results could differ materially from the Company's present expectations. Among the important factors that could cause actual results to differ materially from those indicated in the forward-looking statements are: customer demand and trends in the off-price apparel industry, the effect of economic conditions, the impact of competitive openings and pricing, supply constraints or difficulties and other risks detailed in the Company's Securities and Exchange Commission filings. |
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