J. C. Penney Corporation, Inc. Completes Exchange Offer and Consent Solicitation.

Business Editors

PLANO, Texas--(BUSINESS WIRE)--Aug. 12, 2002

J. C. Penney Corporation, Inc. (the "Corporation"), the wholly-owned operating subsidiary of J. C. Penney Company, Inc. ("Company") (NYSE:JCP), announced today the completion of its offer to exchange

The exchange offer commenced on June 26, 2002. Revised aggregate totals of $79,394,000 principal amount of 6.125% Notes due 2003, $66,964,000 of 7.375% Notes due 2004 and $80,805,000 of 6.900% Debentures due 2026 were tendered in response to the exchange offer.

New notes in the aggregate principal amount of $230,203,000 were issued to noteholders tendering in the exchange. The Corporation also paid the required consent payment to holders who tendered. No amendments were made to the indentures governing the old notes.

This press release shall not constitute an offer to sell or the solicitation of an offer to buy any security and shall not constitute an offer, solicitation or sale in any jurisdiction in which such offering, solicitation or sale would be unlawful. The New Notes have not been registered under the Securities Act of 1933, as amended.

J. C. Penney Corporation, Inc., the wholly-owned operating subsidiary of the Company, is one of America's largest department store, drugstore, catalog, and e-commerce retailers, employing approximately 250,000 associates. As of July 27, 2002, it operated 1,068 JCPenney department stores in all 50 states, Puerto Rico, and Mexico, and 54 Renner department stores in Brazil. Eckerd Corporation operated 2,642 drugstores throughout the Southeast, Sunbelt, and Northeast regions of the U.S. JCPenney Catalog, including e-commerce, is the nation's largest catalog merchant of general merchandise. J. C. Penney Corporation, Inc. is a contributor to JCPenney Afterschool Fund, a charitable organization committed to providing children with high quality after school programs to help them reach their full potential.

The statements in this press release which are not historical facts or information may be forward-looking statements. These forward-looking statements involve risks and uncertainties that could cause the outcome to be materially different. Certain of these risks and uncertainties are described in the 2001 Form 10-K and subsequent filings of J. C. Penney Company, Inc.