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Precision Auto Care Secures $5 Million Bridge Loan

26 January 1999

Precision Auto Care Secures $5 Million Bridge Loan to Help Restructure its Debt

    LEESBURG, Va., Jan. 26 -- Precision Auto Care, Inc. announced
today that it has received a $5,000,000 bridge loan from a member of its Board
of Directors to help restructure its debt, according to Charles L. Dunlap,
President and CEO.
    Precision Auto Care also has reached an agreement in principal with the
Company's senior lender on a modification to its loan agreement, which
provides for the restructuring of its repayment. The Bank has also agreed to
the waiver of financial covenants through the quarter ending March 31, 1999.
The proposed modification with the Bank calls for the Company to reduce its
outstanding indebtedness with the Bank by $13,500,000 by April, 25, 1999.  The
Company will use $2,500,000 of the proceeds from the bridge financing as Bank
repayment, and announced that it currently has approximately $11,000,000 in
commitments from mortgage lenders and another $5,750,000 in signed purchase
agreements for the sale of non-strategic Company car washes and auto care
centers, said Dunlap.
    "This bridge loan will allow the Company to achieve significant paydown in
its status with vendors and to give the Company much needed breathing room to
continue to improve our core businesses," said Dunlap.
    He further explained that "the restructuring which we began in November is
having a positive impact on our operations, and we fully expect that future
quarters, starting with the current third fiscal quarter, will show much
improved performance. We are very appreciative of the financial support from
our Board, as well as the willingness of our Bank to work with us as we
continue to restructure and solidify our business."
    Precision Auto Care, Inc. is the world's largest franchisor
of auto care centers, currently with 628 operating centers worldwide as of
January 25, 1999.  The Company franchises and operates Precision Tune Auto
Care, Precision Auto Wash, and Precision Lube Express centers around the
world.  Please visit the Company's web site at:  http://www.PrecisionAC.com
    Cautionary Statement:  The statements in this press release constitute
"forward-looking statements" within the meaning of Section 27A of the
Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934.
These statements are subject to risks and uncertainties that could cause
Precision Auto Care Inc.'s actual results, performance or achievements to
differ materially from any future results, performance or achievements
expressed or implied by such forward-looking statements.  Such risks and
uncertainties include, but are not limited to, (i) the risks and uncertainties
reflected and set forth in the text of this press release, (ii) the fact that
Precision Auto Care Inc. and the companies it acquired on and subsequent to
the date of its initial public offering have only recently conducted
operations as a combined company, (iii) the seasonal nature of portions of the
business, (iv) the highly competitive markets in which Precision Auto Care
Inc. operations, (v) difficulties in integrating all of the businesses
Precision Auto Care Inc. has acquired, (vi) risks associated with Precision
Auto Care Inc.'s ability to continue its strategy of growth through
acquisitions and (vii) risks associated with Company's ability to make or
effect acquisitions in the future and to successfully integrate newly-acquired
businesses into existing operations and the risks associated with such newly-
acquired businesses.