"The Fortress transaction is intended to stabilize the company'sfinancial condition and strengthen the company's balance sheet byreducing our overall level of debt and extending certain loanmaturities," says Glenn D. Reschke, Prime Retail's chairman,president and CEO.

The proceeds from the mezzanine loan, the Puerto Rico mortgageloan, and the sale of the four outlet centers will be used to payoff up to $117 million of Prime Retail's short-term debt, some ofwhich is currently in default. The remainder of the proceeds willbe used for general corporate purposes, including the funding ofcertain programs to attract and retain tenants through increasedmarketing and capital improvements.

The $71-million loan will be secured by pledges of equityinterests in certain outlet centers. Negotiations are underwayregarding numerous conditions attached to the proposedtransaction.