CD Warehouse and Djangos.com Extend Letter of Intent

CD Warehouse, an operator and franchisor of retail music stores, and Djangos.com, Inc. ("Djangos"), a privately held retailer of used and new music and movies through its stores and through the Djangos.com website, jointly announced today that CD Warehouse and Djangos have amended the existing letter of intent, in which CD Warehouse has agreed to merge with Djangos, to provide that if the parties do not enter into a definitive merger agreement on or before January 25, 2002, the letter of intent will terminate. The merger of CD Warehouse and Djangos is subject to, among other things, the negotiation and execution of a definitive merger agreement and the approval of the transaction by the shareholders of CD Warehouse.

CD Warehouse, Inc. Franchises and operates retail music stores in 36 states, the District of Columbia, England, Thailand, Guatemala, Canada and Venezuela under the names "CD Warehouse," "Disc Go Round," "CD Exchange" and "Music Trader." CD Warehouse stores buy, sell and trade pre-owned CDs, DVDs and games with their customers, as well as sell a full complement of new release CDs.

Djangos states that it is the largest independent re-seller of used music on the Internet and offers more than one million titles of used and new music and movies for sale through its 19 retail stores and Web site (www.djangos.com ). Djangos has stores in California, Washington, Oregon and Illinois that operate under the names "Djangos' Moby Disc," "Djangos' Cellophane Square," "Django Records," and "Djangos' Second Hand Tunes." In addition, Djangos states the Djangos.com Web site currently sells to over 95 countries worldwide.