FRANCHISE FINANCE CORP OF AMERICA, DEF 14A, 1999-03-30

FRANCHISE FINANCE CORP OF AMERICA
DEF 14A, 1999-03-30
REAL ESTATE INVESTMENT TRUSTS

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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

SCHEDULE 14A
(Rule 14a-101)

INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934 (Amendment No. )

Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]

Check the appropriate box:
[ ] Preliminary Proxy Statement [ ] Confidential, For Use of the
[X] Definitive Proxy Statement Commission Only (as permitted
[ ] Definitive Additional Materials by Rule 14a-6(e)(2))
[ ] Soliciting Material Pursuant to
Rule 14a-11(c) or Rule 14a-12

FRANCHISE FINANCE CORPORATION OF AMERICA
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)

- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)

Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.

- --------------------------------------------------------------------------------
1) Title of each class of securities to which transaction applies:

- --------------------------------------------------------------------------------
2) Aggregate number of securities to which transaction applies:

- --------------------------------------------------------------------------------
3) Per unit price or other underlying value of transaction computed pursuant
to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is
calculated and state how it was determined):

- --------------------------------------------------------------------------------
4) Proposed maximum aggregate value of transaction:

- --------------------------------------------------------------------------------
5) Total fee paid:
[ ] Fee paid previously with preliminary materials:
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration
statement number, or the form or schedule and the date of its filing.

1) Amount previously paid:
------------------------------------------
2) Form, Schedule or Registration Statement No.:
--------------------
3) Filing Party:
----------------------------------------------------
4) Date Filed:
------------------------------------------------------
<PAGE>

--------------------
NOTICE OF
1999
ANNUAL MEETING
AND
PROXY STATEMENT
--------------------

ANNUAL MEETING
TO BE HELD
May 12, 1999
<PAGE>

[FRANCHISE FINANCE CORPORATION OF AMERICA LOGO]

Dear Shareholder:

On behalf of the Board of Directors, I cordially invite you to attend
the 1999 Annual Meeting of Shareholders of Franchise Finance Corporation of
America to be held at The Scottsdale Princess Resort, 7575 East Princess Drive,
Scottsdale, Arizona on Wednesday, May 12, 1999 at 10:00 a.m. local time.

The Notice of Annual Meeting of Shareholders and the Proxy Statement
that follow describe the business to be conducted at the meeting. We will also
report on matters of current interest to our shareholders.

Whether you own a few or many shares of stock of Franchise Finance
Corporation of America, it is important that your shares be represented. If you
cannot personally attend the meeting, we encourage you to make certain you are
represented at the meeting by signing and dating the accompanying proxy card and
promptly returning it in the enclosed envelope. Returning your proxy card will
not prevent you from voting in person, but will assure that your vote will be
counted if you are unable to attend the meeting.

Sincerely,

/s/ Morton H. Fleischer

March 31, 1999 Morton H. Fleischer, President, Chief Executive
Officer and Chairman of the Board
<PAGE>
[FRANCHISE FINANCE CORPORATION OF AMERICA LOGO]

----------------------------------------------------------------
NOTICE OF 1999 ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD MAY 12, 1999
----------------------------------------------------------------

NOTICE IS HEREBY GIVEN that the Annual Meeting of Shareholders (the
"Meeting") of Franchise Finance Corporation of America (the "Company") will be
held on Wednesday, May 12, 1999 at 10:00 a.m. local time, at The Scottsdale
Princess Resort, 7575 East Princess Drive, Scottsdale, Arizona for the following
purposes:

1. To elect nine directors to the Board of Directors.

2. To consider and vote upon a proposal to amend the Company's 1995
Stock Option and Incentive Plan (the "Stock Option Plan") to
increase the number of shares of the Company's common stock
reserved for issuance under the Stock Option Plan by 1,500,000
shares, from 3,018,804 shares to 4,518,804 shares.

3. To ratify the selection of Arthur Andersen LLP as the Company's
independent auditors for the fiscal year ending December 31,
1999.

4. To transact such other business as may properly come before the
Meeting and at any postponements or adjournments thereof.

Only shareholders of record at the close of business on March 17, 1999
are entitled to notice of and to vote at the Meeting or at any postponements or
adjournments thereof.

You are cordially invited and urged to attend the Meeting. All
shareholders, whether or not they expect to attend the Meeting in person, are
requested to complete, date and sign the enclosed form of Proxy and return it
promptly in the postage paid, return-addressed envelope provided for that
purpose. By returning your Proxy promptly you can help the Company avoid the
expense of follow-up mailings to ensure a quorum so that the Meeting can be
held. Shareholders who attend the Meeting may revoke a prior proxy and vote in
person as set forth in the Proxy Statement.

THE ENCLOSED PROXY IS BEING SOLICITED BY THE BOARD OF DIRECTORS OF THE
COMPANY. THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE IN FAVOR OF THE
PROPOSED ITEMS. YOUR VOTE IS IMPORTANT.

By Order of the Board of Directors

/s/ Christopher H. Volk

Christopher H. Volk, Secretary

Scottsdale, Arizona
Dated: March 31, 1999
<PAGE>
FRANCHISE FINANCE CORPORATION OF AMERICA
17207 North Perimeter Drive
Scottsdale, Arizona 85255

--------------------------------------------------

PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD MAY 12, 1999

--------------------------------------------------

GENERAL INFORMATION

This Proxy Statement is furnished in connection with the solicitation
of proxies by and on behalf of the Board of Directors (the "Board") of Franchise
Finance Corporation of America, a Delaware corporation (the "Company"), for use
at the Annual Meeting of Shareholders of the Company to be held at The
Scottsdale Princess Resort, 7575 East Princess Drive, Scottsdale, Arizona, on
Wednesday, May 12, 1999 at 10:00 a.m. local time, and at any and all
postponements or adjournments thereof (collectively referred to herein as the
"Meeting"). This Proxy Statement, the accompanying form of proxy (the "Proxy")
and the Notice of Annual Meeting will be first mailed or given to the Company's
shareholders on or about March 31, 1999.

Because many of the Company's shareholders may be unable to attend the
Meeting in person, the Board solicits proxies by mail to give each shareholder
an opportunity to vote on all matters presented at the Meeting. Shareholders are
urged to: (i) read this Proxy Statement carefully; (ii) specify their choice in
each matter by marking the appropriate box on the enclosed Proxy; and (iii)
sign, date and return the Proxy by mail in the postage-paid, return addressed
envelope provided for that purpose.

All shares of the Company's common stock, $.01 par value per share (the
"Shares"), represented by properly executed and valid Proxies received in time
for the Meeting will be voted at the Meeting in accordance with the instructions
marked thereon or otherwise as provided therein, unless such Proxies have
previously been revoked. Unless instructions to the contrary are marked, or if
no instructions are specified, Shares represented by the Proxies will be voted
for the proposals set forth on the Proxy, and in the discretion of the persons
named as proxies on such other matters as may properly come before the Meeting.
Any Proxy may be revoked at any time prior to the exercise thereof by submitting
another Proxy bearing a later date or by giving written notice of revocation to
the Company at the Company's address indicated above or by voting in person at
the Meeting. Any notice of revocation sent to the Company must include the
shareholder's name and must be received prior to the Meeting to be effective.

VOTING

Only persons holding Shares of record at the close of business on March
17, 1999 (the "Record Date") will be entitled to receive notice of and to vote
at the Meeting. On the Record Date there were 55,861,838 Shares outstanding,
each of which will be entitled to one vote on each matter properly submitted for
vote to the Company's shareholders at the Meeting. The presence, in person or by
proxy, of holders of a majority of outstanding Shares entitled to vote at the
Meeting constitutes a quorum for the transaction of business at the Meeting.
<PAGE>
The election of each director nominee requires the affirmative vote of
a plurality of the Shares cast in the election of directors at the Meeting. The
Company's shareholders are not entitled to cumulate votes with respect to the
election of directors. An affirmative vote of a majority of the votes cast at
the Meeting is required for approval of all other items being submitted to the
shareholders for their consideration.

Those Shares present, in person or by proxy, including Shares as to
which authority to vote on any proposal is withheld, Shares abstaining as to any
proposal, and broker non-votes (where a broker submits a proxy but does not have
authority to vote a customer's Shares on one or more matters) on any proposal,
will be considered present at the Meeting for purposes of establishing a quorum.
Each will be tabulated separately.

Brokers who hold shares in street name for customers have the authority
to vote on certain items when they have not received instructions from
beneficial owners. Brokers that do not receive instructions are entitled to vote
on all proposals contained in this Proxy.

Abstentions are counted in tabulations of the votes cast on proposals
presented to shareholders, while broker non-votes are not counted for purposes
of determining whether a proposal has been approved.

Votes cast by proxy will be tabulated by an automated system
administered by Gemisys Transfer Agents, the Company's transfer agent. Votes
cast by proxy or in person at the Meeting will be counted by the independent
persons appointed by the Company to act as election inspectors for the Meeting.

PROPOSAL NO. 1

ELECTION OF DIRECTORS

It is intended that the Shares represented by properly executed Proxies
will be voted to elect the director nominees, unless authority so to vote is
withheld. Each nominee is currently a member of the Board and all of the
nominees have indicated a willingness to serve as a director if re-elected. If
elected, each nominee will serve until the 2000 Annual Meeting of Shareholders
or until his earlier removal or resignation. The Board has no reason to believe
that any of the director nominees will be unable to serve as directors or become
unavailable for any reason. If, at the time of the Meeting, any of the director
nominees shall become unavailable for any reason, the persons entitled to vote
the Proxy will vote, as such persons shall determine in his or her discretion,
for such substituted nominee or nominees, if any, nominated by the Board. There
are no family relationships among any directors and executive officers of the
Company.

The affirmative vote of a plurality of the Shares present or
represented to vote at the Meeting is necessary to elect each director nominee.
Shareholders of the Company will have an opportunity on their Proxy to vote in
favor of one or more director nominees while withholding authority to vote for
one or more director nominees.

THE BOARD RECOMMENDS THAT SHAREHOLDERS GRANT AUTHORITY FOR THE ELECTION
OF THE NOMINEES TO THE BOARD OF DIRECTORS

2
<PAGE>
DIRECTORS

The following table sets forth certain information with respect to the
directors of the Company:
<TABLE>
<CAPTION>
Principal Occupation or Employment During Director of the
Name and Age the Past Five Years; Other Directorships Company Since
- ------------ ---------------------------------------- ---------------
<S> <C> <C>
Morton H. Fleischer Director, Chairman of the Board, President and Chief June 22, 1993
(62) Executive Officer of the Company. Mr. Fleischer
previously served as the President, Chief Executive
Officer and director of Franchise Finance Corporation
of America I, a Delaware corporation ("FFCA I") (a
predecessor corporation of the Company) since its
formation in 1980. Mr. Fleischer has acted as an
individual general partner (or general partner of the
general partner) of the eleven public limited
partnerships that were consolidated to form the
Company in 1994. In addition, he is a general partner
(or general partner of the general partner) in the
following public limited partnerships whose
investments are set forth in parentheticals:
Participating Income Properties 1986, L.P. (travel
plazas); Participating Income Properties II, L.P.
(travel plazas); Participating Income Properties III
Limited Partnership (travel plazas); and Scottsdale
Land Trust Limited Partnership (commercial land
development).

Robert W. Halliday Director and Chairman Emeritus of the Board of the June 22, 1993
(79) Company. Mr. Halliday previously served as the
Chairman of the Board of the Company since its
organization and of FFCA I since its formation in
1980. He has served as a director of several publicly
held American and Canadian companies, including Great
Pacific Corporation, Mitchell Energy & Development
Corporation, Boise Cascade Corporation and Jim
Pattison Enterprises.

Willie R. Barnes, Esq. Corporate and securities law attorney. Mr. Barnes has March 14, 1995
(67) been a partner in the law firm of Musick, Peeler &
Garrett since June 1992. He is a member of the
Business Law Section of the American Bar Association,
in addition to other committees. Mr. Barnes was
appointed as the Commissioner of Corporations for the
State of California in 1975 and is a member of the
California Senate Commission on Corporate Governance,
Shareholder Rights and Securities Transactions. He is
currently a director and secretary of American Shared
Hospital Services.

Kelvin L. Davis Mr. Davis is President and Chief Operating Officer of March 13, 1998
(35) Colony Capital, Inc., an international real
estate-related investment firm. He has been with
Colony since its formation in 1991. He also serves as
Co-Managing General Partner of Colony's active
discretionary equity funds, including Colony
Investors II, L.P., and Colony Investors III, L.P.
Prior to 1991, Mr. Davis was a principal of RMB
Realty, Inc. Prior to that time he was employed by
Goldman, Sachs & Co. and Trammell Crow Company.

Donald C. Hannah Chairman and Chief Executive Officer of U.S. August 1, 1994
(66) Properties, Inc. Mr. Hannah is a member of the Chief
Executives Organization and the World Presidents'
Organization, and is a director of the Precision
Standard Corporation (NASDAQ), the Samoth Capital
Corporation and the Marine Resources Foundation.
</TABLE>
3
<PAGE>
<TABLE>
<CAPTION>
Principal Occupation or Employment During Director of the
Name and Age the Past Five Years; Other Directorships Company Since
- ------------ ---------------------------------------- ---------------
<S> <C> <C>
Dennis E. Mitchem Director of Corporate Relations, Northern Arizona January 29, 1996
(67) University since October 1998. Mr. Mitchem has also
served as Executive Director of Habitat for Humanity,
Valley of the Sun, from April 1996 to October 1998,
and prior to that time was an independent management
consultant for privatization and financial services
projects. From March 1994 to December 1995, Mr.
Mitchem worked in Moscow serving as a consultant to
the Russian Privatization Center in the establishment
of its local Privatization Centers. From July 1992 to
February 1994, he was Managing Director of CAJV, a
joint venture between Arthur Andersen and Castillo
Company, Inc., and managed the Denver, Colorado,
financial processing center of the Resolution Trust
Corporation. From 1954 to June 1993, he was employed
by Arthur Andersen LLP, where he became a partner in
1967 and retired as a senior partner in June 1993.

Louis P. Neeb Chairman of the Board and Chief Executive Officer of August 1, 1994
(59) Casa Ole Restaurants, Inc. since October 1995. Mr.
Neeb also serves as President of Neeb Enterprises,
Inc., a restaurant consulting firm. He was President
and Chief Executive Officer of Spaghetti Warehouse,
Inc., from 1991 to January 1994 and President of
Geest Foods USA from September 1989 to June 1991,
prior to which he served as President and Chief
Executive Officer of Taco Villa, Inc. Mr. Neeb spent
ten years with the Pillsbury Company in various
positions which included: Executive Vice President,
Pillsbury; Chairman of the Board, Burger King; and
President, Steak 'N Ale Restaurants. Mr. Neeb is also
a director of CEC Entertainment, Inc. (formerly
ShowBiz Pizza Time, Inc.) and Silver Diner
Development Inc. and was previously a director of On
the Border Cafes, Inc.

Kenneth B. Roath Chairman and Chief Executive Officer of Health Care August 1, 1994
(63) Property Investors, Inc., a real estate investment
trust organized in 1985 to invest, on a net lease
basis, in health care properties. Mr. Roath is a
director and chairman of the compensation committee
of Arden Realty, Inc. (NYSE), a real estate
investment trust. Mr. Roath is also the past Chairman
and a past member of the executive committee of the
National Association of Real Estate Investment
Trusts, Inc. ("NAREIT"). Mr. Roath is Ex-Officio
member of the Board of Governors of NAREIT.

Casey J. Sylla Senior Vice President and Chief Investment Officer of August 1, 1994
(55) Allstate Insurance Company. From 1992 until July
1995, Mr. Sylla was an Executive Officer and Vice
President and head of the Securities Department of
The Northwestern Mutual Life Insurance Company.

Shelby Yastrow Mr. Yastrow is an attorney and counsel to the law July 24, 1997
(63) firm of Sonnenschein Nath & Rosenthal in Chicago,
Illinois. He joined McDonald's Corporation in 1978 as
Vice President, Chief Counsel of Litigation and
Assistant Secretary. He was appointed Vice President,
General Counsel of McDonald's Corporation in 1982 and
Senior Vice President in 1988, before being named
Executive Vice President in 1995. He retired from
McDonald's Corporation in December 1997. Mr. Yastrow
received his law degree from Northwestern University
in 1959.
</TABLE>
4
<PAGE>
With the exception of Mr. Hannah, each of the persons named above has
been nominated for re-election to the Board of Directors of the Company.

ARRANGEMENTS REGARDING THE SELECTION OF DIRECTORS

Mr. Kelvin L. Davis is currently serving on the Board pursuant to the
terms of an Investor's Agreement dated March 13, 1998 (the "Investor's
Agreement"), together with a Stock Purchase Agreement dated February 13, 1998,
whereby Colony SB, LLC, a Delaware limited liability company ("Colony"), an
affiliate of Colony Capital, Inc., acquired 3,792,112 shares of the Company's
common stock and warrants to purchase an additional 1,476,908 shares of the
Company's common stock. As provided in the Investor's Agreement, Colony
Investors III, L.P., the sole managing member of Colony, may designate one
nominee for election to the Board at each annual meeting of shareholders of the
Company, so long as Colony beneficially owns common stock representing at least
50% of its initial purchase. Pursuant to the Investor's Agreement, Mr. Davis is
currently serving on the Board and is a nominee for election to the Board at the
Meeting.

BOARD MEETINGS

The Board held seven (7) meetings during the fiscal year ended December
31, 1998. The Board also took action three (3) times by unanimous written
consent. During a director's tenure, no director other than Mr. William Foxley
attended fewer than 75% of the aggregate of (i) the total number of meetings of
the Board during 1998; and (ii) the total number of meetings held by all
committees of the Board on which he served during 1998. Mr. Foxley attended four
(4) of the seven (7) Board meetings held during the fiscal year ended December
31, 1998.

COMMITTEES OF THE BOARD

AUDIT COMMITTEE. In 1998, the members of the Audit Committee were
Messrs. Kenneth B. Roath, Chairman, Wendell J. Smith, Willie R. Barnes and
Dennis E. Mitchem. The Audit Committee makes recommendations concerning the
engagement of independent public accountants, reviews with the independent
public accountants the plans and results of the audit engagement, approves
professional services provided by the independent public accountants, reviews
the independence of the independent public accountants, considers the range of
audit and non-audit fees and reviews the adequacy of the Company's internal
accounting controls. The Audit Committee held two (2) meetings in 1998.

EXECUTIVE COMMITTEE. In 1998, the members of the Executive Committee
were Messrs. Morton H. Fleischer, Chairman, Kelvin L. Davis, Robert W. Halliday
and Donald C. Hannah. The Executive Committee has the authority to acquire,
dispose of and finance investments for the Company and execute contracts and
agreements, including those related to the borrowing of money by the Company,
and generally exercise all other powers of the Board except as prohibited by
law. The Executive Committee held two (2) meetings in 1998 and took action eight
(8) times by unanimous written consent.

COMPENSATION COMMITTEE. In 1998, the members of the Compensation
Committee were Messrs. Casey J. Sylla, Chairman, Louis P. Neeb, Kelvin L. Davis
and Shelby Yastrow. The Compensation Committee, among other things, advises the
Board on all matters pertaining to compensation programs and policies,
establishes guidelines for employee incentive and benefit programs, makes
specific recommendations to the Board relating to salaries of officers and all
incentive awards and administers the Company's 1995 Stock Option and Incentive
Plan. The Compensation Committee held five (5) meetings in 1998.

NOMINATING AND GOVERNANCE COMMITTEE. The Nominating and Governance
Committee was created on July 27, 1998. In 1998, the members of the Nominating
and Governance Committee were Messrs. Shelby Yastrow, Chairman, Willie R.
Barnes, Louis P. Neeb and Casey J. Sylla. The Nominating and Governance
Committee makes recommendations to the Board regarding the size of the Board and
its makeup in terms of specific areas of expertise and diversity. The Nominating
and Governance Committee also recommends the nomination of directors to be
elected at each annual meeting and nominates candidates to fill any vacancies on
the Board. The Nominating and Governance Committee will also consider nominees
recommended by shareholders. Recommendations for the Company's 2000 Annual
Meeting of Shareholders must be submitted in writing to Christopher H. Volk,

5
<PAGE>
Executive Vice President and Secretary of the Company, at 17207 North Perimeter
Drive, Scottsdale, Arizona 85255. Such recommendations must include the name,
address and principal business occupation of the candidate for the last five
years, and must be received at the Company's offices on or before November 15,
1999.

COMPENSATION OF DIRECTORS

The Company pays an annual fee of $30,000 to its Independent Directors
(i.e., directors who are not employees of the Company or its affiliates). In
1998, the Independent Directors received 20% of such annual fee in non-qualified
stock options to purchase Shares based upon the Black-Scholes option pricing
model. In 1998, Messrs. Barnes, Davis, Foxley, Halliday, Hannah, Mitchem, Neeb,
Roath, Smith, Sylla and Yastrow each received options to purchase 2,273 Shares
at $27.125 per Share, the fair market value of the Shares on May 18, 1998, the
date of grant. These options are exercisable when granted.

Directors who are employees of the Company are not paid director's
fees, but the Company does reimburse directors for travel expenses incurred in
connection with their activities on behalf of the Company. Each director also
receives $500 for each committee meeting the director attends, with the chairman
of the respective committee receiving $1,000 for each committee meeting.

EXECUTIVE OFFICERS

Set forth below is certain information regarding the executive officers
of the Company, including age, principal occupation during the last five years
and the date each became an executive officer of the Company.
<TABLE>
<CAPTION>
Executive Officer of
Name/Age Present Executive Office the Company Since
- -------- ------------------------ --------------------
<S> <C> <C>
Morton H. Fleischer Director, Chairman of the Board, President and Chief June 22, 1993
(62) Executive Officer of the Company. Mr. Fleischer
previously served as the President, Chief Executive
Officer and director of Franchise Finance Corporation
of America I, a Delaware corporation ("FFCA I") (a
predecessor corporation of the Company) since its
formation in 1980. Mr. Fleischer has acted as an
individual general partner (or general partner of the
general partner) of the eleven public limited
partnerships that were consolidated to form the
Company in 1994. In addition, he is a general partner
(or general partner of the general partner) in the
following public limited partnerships whose
investments are set forth in parentheticals:
Participating Income Properties 1986, L.P. (travel
plazas); Participating Income Properties II, L.P.
(travel plazas); Participating Income Properties III
Limited Partnership (travel plazas); and Scottsdale
Land Trust Limited Partnership (commercial land
development).

John R. Barravecchia Executive Vice President, Chief Financial Officer, June 1, 1994
(43) Treasurer and Assistant Secretary. Mr. Barravecchia
previously served as Senior Vice President, Chief
Financial Officer and Treasurer of the Company from
June 1, 1994 until July 28, 1995, and as Senior Vice
President of FFCA I from October 1989 until June 1,
1994. Prior to joining FFCA I in March 1984, Mr.
Barravecchia was associated with the international
public accounting firm of Arthur Andersen LLP.
</TABLE>
6
<PAGE>
<TABLE>
<CAPTION>
Executive Officer of
Name/Age Present Executive Office the Company Since
- -------- ------------------------ --------------------
<S> <C> <C>
Christopher H. Volk Executive Vice President, Chief Operating Officer, June 1, 1994
(42) Secretary and Assistant Treasurer. Mr. Volk
previously served as Senior Vice
President--Underwriting and Research of the Company
from June 1, 1994 until July 28, 1995, and as Vice
President--Research of FFCA I from October 1989 until
June 1, 1994. Mr. Volk is a member of NAREIT and
currently serves as co-chair of its Public Relations
Committee.

Dennis L. Ruben Executive Vice President, General Counsel and June 1, 1994
(46) Assistant Secretary. Mr. Ruben served as Senior Vice
President and General Counsel of the Company from
June 1, 1994 to January 28, 1997. Mr. Ruben
previously served as an attorney and counsel of FFCA
I from March 1991 until June 1, 1994. Prior to
joining FFCA I, Mr. Ruben was a partner with the
national law firm of Kutak Rock.

Stephen G. Schmitz Executive Vice President, Chief Investment Officer May 31, 1995
(44) and Assistant Secretary. Mr. Schmitz served as Senior
Vice President--Corporate Finance from June 1, 1994
to January 28, 1997. Mr. Schmitz previously served as
Senior Vice President of the Company and served in
various positions as an officer of FFCA I from 1986
to June 1, 1994.

Catherine F. Long Senior Vice President--Finance, Principal Accounting June 1, 1994
(42) Officer, Assistant Secretary and Assistant Treasurer.
Ms. Long served as Vice President--Finance of the
Company from June 1, 1994 to January 28, 1997. Ms.
Long previously served as Vice President--Finance of
FFCA I from June 1990 until June 1, 1994. From 1978
to May 1990, Ms. Long was associated with the
international public accounting firm of Arthur
Andersen LLP.
</TABLE>
7
<PAGE>
EXECUTIVE COMPENSATION

SUMMARY COMPENSATION TABLE

The following table sets forth the compensation awarded to, earned by,
or paid to (i) the Company's Chief Executive Officer ("CEO") during 1998, 1997,
and 1996, and (ii) the Company's other four most highly compensated executive
officers whose total annual compensation exceeded $100,000 during 1998, 1997,
and 1996 (the "Named Executive Officers").

SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
ANNUAL COMPENSATION LONG-TERM AWARDS
-------------------------------- ----------------------
Securities
Other Annual Restricted Underlying
Bonus Compensation Stock Options All Other
Name and Principal Positions Year Salary($) ($)(1) ($) ($)(2) (#) Compensation(3)
- ---------------------------- ---- --------- ------ ------------ ---------- ---------- ---------------
<S> <C> <C> <C> <C> <C> <C> <C>
Morton H. Fleischer 1998 $450,000 $450,000 -0- $138,075 -0- -0-
Director, Chairman of the 1997 $450,000 -0- -0- -0- 200,000 -0-
Board, President and Chief 1996 $450,000 $250,000 -0- -0- 200,000 -0-
Executive Officer

Christopher H. Volk 1998 $250,000 $250,000 -0- $124,958 -0- $10,000
Executive Vice President, 1997 $250,000 $165,000 -0- -0- 157,000 $ 9,500
Chief Operating Officer, 1996 $222,917 $125,000 -0- -0- 30,000 $ 8,183
Secretary and Assistant
Treasurer

John R. Barravecchia 1998 $200,000 $200,000 -0- $99,966 -0- $10,000
Executive Vice President, 1997 $200,000 $138,000 -0- -0- 82,000 $ 9,500
Chief Financial Officer, 1996 $200,000 $100,000 -0- -0- 30,000 $ 9,000
Treasurer and Assistant
Secretary

Stephen G. Schmitz 1998 $200,000 $300,000 -0- $99,966 -0- $10,000
Executive Vice President, 1997 $200,000 $193,000 -0- -0- 92,000 $ 9,375
Chief Investment Officer 1996 $165,000 $135,000 -0- -0- 20,000 $ 9,000
and Assistant Secretary

Dennis L. Ruben 1998 $200,000 $250,000 -0- $99,966 -0- $10,000
Executive Vice President, 1997 $200,000 $154,000 -0- -0- 62,000 $ 9,180
General Counsel and 1996 $172,500 $ 86,250 -0- -0- -0- $ 9,000
Assistant Secretary
</TABLE>
- ----------
(1) Bonus includes the amount of cash bonus earned and accrued (a) during the
period from January 1, 1998 to December 31, 1998 and paid in January 1999;
(b) during the period from January 1, 1997 to December 31, 1997 and paid in
January 1998; and (c) during the period from January 1, 1996 to December
31, 1996 and paid in January 1997.
(2) As of December 31, 1998, there were outstanding 29,886 shares of restricted
stock which were valued at $717,264 using the market value of the Company's
shares at fiscal yearend. The closing price of the Company's Shares on
December 31, 1998 was $24. The restricted stock was granted on January 30,
1998 and is subject to continued-service conditions on vesting. The stock
vests in three equal installments on the third, fourth and fifth
anniversaries of the date of grant. Dividends are paid on the restricted
stock at the same rate as is paid on the Company's common stock.
(3) Amounts included in All Other Compensation represent matching Company
contribution amounts received under the Company's 401(k) Plan.

The foregoing compensation tables do not include certain fringe
benefits made available on a nondiscriminatory basis to all Company employees
such as group health insurance, dental insurance, long-term disability
insurance, vacation and sick leave. In addition, the Company makes available
certain non-monetary benefits to its executive officers with a view to acquiring
and retaining qualified personnel and facilitating job performance. The Company
considers such benefits to be ordinary and incidental business costs and
expenses. The aggregate value of such benefits in the case of each executive
officer and of the group listed in the above table is less than the lesser of

8
<PAGE>
(a) ten percent of the cash compensation paid to each such executive officer or
to the group, respectively, or (b) $50,000, or $50,000 times the number of
individuals in the group, as the case may be, and is not included in such table.

COMPENSATION PURSUANT TO PLANS

401(k) PLAN. The Company has adopted a defined contribution savings
plan (the "401(k) Plan") to provide retirement income to employees of the
Company, including the executive officers referred to in the Summary
Compensation Table. The 401(k) Plan is intended to be qualified under Section
401(a) of the Internal Revenue Code of 1986, as amended (the "Code"), and
incorporates features permitted under Section 401(k) of the Code.

The 401(k) Plan covers all employees who have completed six months of
service. Participants can elect to contribute up to 15% of annual compensation
on a pre-tax basis. The Company provides a 100% matching contribution, in the
Company's common stock, up to 6% of annual compensation, with a maximum of
$10,000.

Company contributions are subject to a vesting schedule and are 100%
vested after six years of service. In determining the years of service, the
Company includes the time a participant was an employee of FFCA I, a predecessor
corporation of the Company. Participant contributions are invested as directed
by each participant in investment funds available under the 401(k) Plan. Full
retirement benefits are payable to each participant in a single cash payment or
an actuarial equivalent form of annuity on the first day of the month following
the participant's retirement or after his or her 65th birthday. In general, if
employment ceases before the employee reaches age 65, the vested benefits under
the 401(k) Plan are paid in full at termination of employment or a later date
elected by the participant. The 401(k) Plan provides death benefits to a
participant's beneficiary if the participant dies before his or her retirement
benefits commence or if a survivor form of annuity is in effect.

STOCK OPTION PLANS. The Company has one stock option plan, the 1995
Stock Option and Incentive Plan (the "Stock Option Plan"), under which options
may currently be granted. Directors, executive officers, other key employees and
other key persons associated with the Company are eligible to receive options
under this plan.

The Compensation Committee and the Board believe that stock-based
compensation programs are a key element in achieving the Company's continued
financial and operational success. The Company has established the Stock Option
Plan to enable directors, executive officers, other key employees and other key
persons associated with the Company to participate in the ownership of the
Company. Initially, the Company reserved 3,018,804 Shares, which equals 7-1/2%
of the Shares outstanding as of March 14, 1995, for grant under the Stock Option
Plan, and this amount may not be increased without the approval of the
shareholders. The maximum number of Shares with respect to which awards may be
granted to any one individual during any calendar year is 200,000. In addition,
Shares may not be acquired pursuant to the Stock Option Plan if the acquisition
violates the ownership limit or causes the Company to fail to qualify as a real
estate investment trust ("REIT") for federal income tax purposes.

The Stock Option Plan is designed to attract and retain directors,
executive officers, key employees and other key persons associated with the
Company and to provide incentives to such persons to maximize the Company's cash
flow available for distribution. The Stock Option Plan provides for the award to
executive officers (including officers who are also directors) and other key
employees of the Company of a broad variety of stock-based compensation
alternatives such as non-qualified stock options, incentive stock options
(unless the context indicates to the contrary, the term "option" shall refer to
both incentive and non-qualified stock options), restricted stock and
performance awards.

The Stock Option Plan is administered by the Compensation Committee,
consisting entirely of Independent Directors. The Compensation Committee shall
construe and interpret the Stock Option Plan and, subject to the express
provisions of the Stock Option Plan, is authorized to select from among the
eligible employees of the Company the individuals to whom options, restricted
stock purchase rights and performance awards are to be granted and to determine
the number of Shares to be subject thereto and the terms and conditions thereof.
The Compensation Committee is also authorized to adopt, amend and rescind rules
relating to the administration of the Stock Option Plan.

9
<PAGE>
AWARDS UNDER THE STOCK OPTION PLAN

TERMS AND CONDITIONS OF OPTIONS; PAYMENT. Incentive stock options
granted under the Stock Option Plan are exercisable for a period of not more
than ten (10) years from the date of the grant. Any non-qualified options
granted under the Stock Option Plan are exercisable at such times, in such
amounts and during such periods as the Compensation Committee determines at the
date of the grant. Such options generally vest over a three-year period for
employees. If the optionee exercises the option, payment may be made either in
cash, certified check or other immediately available funds, with previously
issued Shares (valued as of the date of the option exercise), a combination of
cash, certified check or other immediately available funds and Shares or any
other consideration permitted under applicable law. The Compensation Committee
may allow a delay in payment up to thirty days from the date the option is
exercised; however, the Company will not issue stock certificates until it has
received full payment for the Shares.

NON-QUALIFIED STOCK OPTIONS. The Compensation Committee may grant
non-qualified stock options to employee directors, officers, employees and other
persons associated with the Company and such options may provide for the right
to purchase Shares at a specified price which may be less than fair market value
on the date of grant (but not less than par value), and usually will become
exercisable in installments after the grant date. Non-qualified stock options
may be granted to employee directors, officers and employees and other persons
associated with the Company for any reasonable term.

In addition, non-employee directors of the Company will automatically
receive certain non-qualified stock options in an amount equal to 20% of the
dollar amount of the directors' annual retainer fee. The exercise price of the
options will equal the fair market value of the Company's common stock on the
date of grant. The amount of options received will be determined through the
application of the Black-Scholes option pricing model.

INCENTIVE STOCK OPTIONS. Incentive stock options are designed to comply
with the provisions of the Code and are subject to restrictions contained in the
Code, including a requirement that exercise prices are equal to at least 100% of
fair market value of the Shares on the grant date and a ten-year restriction on
the option term, but may be subsequently modified to disqualify them from
treatment as incentive stock options. For purposes of the Stock Option Plan, the
fair market value of a Share as of a given date is the average of the daily
market price for the ten consecutive trading days immediately preceding the
valuation date. To the extent the aggregate fair market value of Shares with
respect to which incentive stock options are exercisable for the first time by
the optionee during any calendar year under the Stock Option Plan exceeds
$100,000, such options shall be treated as non-qualified options to the extent
required by the Code.

RESTRICTED STOCK. Restricted stock may be sold to participants at
various prices (but not below par value) and made subject to such restrictions
as may be determined by the Compensation Committee. Typically, restricted stock
may be repurchased by the Company at the original purchase price if the
conditions or restrictions are not met. In general, restricted stock may not be
sold, or otherwise transferred or hypothecated, until the restrictions are
removed or expire. Purchasers of restricted stock, unlike recipients of options,
will have voting rights and will receive dividends prior to the time when the
restrictions lapse.

PERFORMANCE AWARDS. The value of performance awards may be limited to
the market value, book value or other measure of the Company's common stock or
other specific performance criteria deemed appropriate by the Compensation
Committee. In making such determinations, the Compensation Committee considers,
among other factors it deems relevant, the contributions, responsibilities and
other compensation of the key employee, or person associated with the Company,
at issue. The manner of exercise, payment of consideration and term of the
performance awards are generally the same as those applying to stock options
granted under the Stock Option Plan. The Company has not issued any performance
awards.

10
<PAGE>
EMPLOYMENT AND CHANGE-IN-CONTROL ARRANGEMENTS

The Company has no employment or change-in-control agreements with any
executive officer of the Company.

OPTION GRANTS TABLE

Neither the CEO nor any of the Named Executive Officers were granted
stock options under the Stock Option Plan during the fiscal year ended December
31, 1998.

AGGREGATED OPTION EXERCISES AND FISCAL YEAR-END OPTION VALUE TABLE

The following table provides information related to the exercise of
stock options during the year ended December 31, 1998 by the CEO and each of the
Named Executive Officers and the 1998 fiscal year-end value of unexercised
options.

AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR-END
OPTION VALUES
<TABLE>
<CAPTION>
NUMBER OF SECURITIES VALUE OF UNEXERCISED
UNDERLYING UNEXERCISED IN-THE-MONEY
OPTIONS AT FY-END (#) OPTIONS AT FY-END
--------------------- -----------------
SHARES ACQUIRED EXERCISABLE/ EXERCISABLE/
NAME ON EXERCISE(#) VALUE REALIZED($) UNEXERCISABLE UNEXERCISABLE($)(1)
---- -------------- ----------------- ------------- -------------------
<S> <C> <C> <C> <C>
Morton H. Fleischer 0 0 199,999/200,001 $283,333/$141,667

Christopher H. Volk 5,125 $41,641 205,208/114,667 $640,438/$21,250

John R. Barravecchia 0 0 185,333/64,667 $663,500/$21,250

Stephen G. Schmitz 0 0 181,999/68,001 $649,333/$14,167

Dennis L. Ruben 0 0 158,666/41,334 $621,000/$-0-
</TABLE>
- ----------
(1) Market value of underlying Shares on date of fiscal year-end minus the
exercise price. The closing price of the Company's Shares on December 31,
1998 was $24.

COMPLIANCE WITH SECTION 16(a) OF THE SECURITIES EXCHANGE ACT OF 1934

Section 16(a) of the Securities Exchange Act of 1934, as amended,
requires the Company's directors and executive officers and persons who own more
than ten percent (10%) of a registered class of the Company's equity securities
("10% Shareholders") to file with the Securities and Exchange Commission (the
"Commission") and the New York Stock Exchange ("NYSE") reports of ownership and
changes in ownership of equity securities of the Company and to furnish the
Company with copies of all Section 16(a) forms they file.

To the Company's knowledge (based solely upon a review of the copies of
such Section 16(a) reports furnished to the Company and written representations
that no other reports were required), for the Company's fiscal year ended
December 31, 1998, the Company's officers, directors and 10% Shareholders have
complied with the Section 16(a) filing requirements.

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

In fiscal 1998, the members of the Compensation Committee were Casey J.
Sylla, Louis P. Neeb, Kelvin L. Davis and Shelby Yastrow. No member of the
Compensation Committee was previously an officer or an employee of the Company
or any of its subsidiaries.

11
<PAGE>
REPORT OF THE COMPENSATION COMMITTEE
ON FISCAL 1998 EXECUTIVE COMPENSATION

The Compensation Committee of the Board is responsible for establishing
compensation policy and administering the compensation programs of the Company's
officers. The Compensation Committee is comprised of four independent outside
directors. The Compensation Committee meets at least once a year to review
executive compensation policies, design of compensation programs and individual
salaries and awards for executive officers.

Pursuant to the rules regarding disclosure of Company policies
concerning executive compensation, this report is submitted by Messrs. Sylla,
Neeb, Davis and Yastrow in their capacity as members of the 1998 Compensation
Committee and addresses the Company's compensation policies for 1998 as they
affected Mr. Fleischer, the Chief Executive Officer ("CEO"), and the Company's
other executive officers, including the Named Executive Officers.

OVERVIEW OF EXECUTIVE COMPENSATION POLICY

The Company's compensation philosophy for executive officers is
incentive oriented. The incentive portion of the Company's executive
compensation program is designed to be closely linked to corporate performance
and returns to shareholders. Accordingly, the Company has developed an overall
compensation strategy and specific compensation plans that tie a significant
portion of executive compensation to the Company's success in meeting specified
performance goals.

The key elements of the Company's executive compensation program
consist of salary, annual bonus, stock options and restricted stock awards. The
Compensation Committee's policies with respect to each of these elements,
including the basis for the compensation awarded to the CEO, are discussed
below. The process used by the Compensation Committee in determining executive
officer compensation levels for all of these components takes into account both
qualitative and quantitative factors. Among the factors considered by the
Compensation Committee are the recommendations of the CEO with respect to the
compensation of the Company's other key executive officers. However, the
Compensation Committee makes the final compensation decisions concerning such
officers.

In making compensation decisions, the Compensation Committee considers
compensation practices and financial performance of the other industry
participants. This information provides guidance to the Compensation Committee,
but the Compensation Committee does not target total executive compensation or
any component thereof to any particular point within, or outside, the range of
results for other industry participants. However, the Compensation Committee
believes that compensation at or near the 75th percentile is generally
appropriate for the Compensation Committee to use as a framework for
compensation decisions. The specified percentiles are considered on both an
absolute basis and a size-adjusted basis (i.e., reflecting compensation levels
that are commensurate with the Company's size relative to the sizes of the other
industry participants). Specific compensation for individual officers will vary
from these levels as the result of other factors considered by the Compensation
Committee.

In making compensation decisions, the Compensation Committee also from
time to time receives assessments and advice regarding the compensation
practices of the Company and others from independent compensation consultants.

The Compensation Committee does not believe that Internal Revenue Code
Section 162(m), which denies a deduction for compensation payments in excess of
one million dollars to the CEO or a Named Executive Officer, is likely to be
applicable to the Company in the near future, but will reconsider the
implications of Section 162(m) if and when it appears that the section may
become applicable.

12
<PAGE>
SALARIES

Salaries for executive officers are determined by evaluating
subjectively the responsibilities of the position held and the experience and
performance of the individual and comparing base salaries for comparable
positions at other industry participants. Subject to an executive officer's
individual performance, the Compensation Committee sets salaries at or about the
median as reflected by such information.

In evaluating the CEO's salary for 1998, the Compensation Committee
considered quantitative factors such as the Company's increased investments
resulting in the Company attaining increased market share in both the ownership
of real estate and the financing of chain properties, and increased FFO. In
addition, the Compensation Committee considered qualitative factors such as Mr.
Fleischer's development of long-term financing strategies for the Company.

ANNUAL BONUS

All Company employees, including the Company's executive officers and
CEO, are eligible for an annual cash bonus. The purpose of the incentive bonus
is to supplement the pay of executive officers (and other key management
personnel) so that overall total cash compensation (salary and bonus) is
competitive and properly rewards them for their efforts in achieving certain
funds from operations ("FFO") targets. FFO generally includes net income, plus
certain non-cash items, primarily depreciation and amortization, and excludes
any gain on the sale of property or the securitization of mortgage loans. The
Company's objective is for the CEO and executive officers to be paid a mix of
total cash compensation of salary and bonus, if the target performance (as
described below) under the plan is achieved.

On an annual basis the Compensation Committee and the Board set minimum
targeted FFO per Share levels ("Targeted FFO") and a target bonus pool. To the
extent the Targeted FFO is attained, the pool will be sufficient to pay the
executive officers, as well as other key management personnel, their target
bonuses. To the extent the Targeted FFO is not achieved, then the target bonus
pool is reduced accordingly. The bonus pool begins to be funded at the point FFO
per Share reaches 95% of Targeted FFO. This minimum level is designed to assure
a threshold return to Company shareholders before a bonus pool is funded. If the
minimum 95% of Targeted FFO is not achieved, no bonus pool is funded. There is
no cap on the size of the pool and thus bonuses in excess of the target may be
earned if FFO exceeds the target level. For 1998, the FFO target level was
reached.

The Board reserves the right to make whatever changes it deems
necessary in the size of the pool and to make such other changes it deems
necessary to preserve the purpose and objectives of the incentive bonus
arrangement. The bonus pool was increased in 1998 because of the Company's
substantial increase in acquisitions and financings in 1998. During 1998, the
Company originated $928 million in new investments, an increase of 84% over the
Company's 1997 level of $504 million. These increased investments were also
attributable to the Company's expansion into the convenience store and
automotive services and parts industries. In addition, the Company received a
positive effect upon its financial condition as a result of the closing of its
securitization transaction in 1998.

The CEO receives a discretionary annual bonus based on both qualitative
and quantitative factors. The primary quantitative factor was achieving the
Company's Target FFO in 1998. An additional quantitative factor also considered
was the significant increase in new investments originated by the Company in
1998, which resulted in $928 million of new investments, or an increase of 84%
over the Company's 1997 level of $504 million. Another quantitative factor
considered was the investment growth in the financing of the convenience store
and automotive services and parts stores, which were new industries for the
Company. These industries represented over $426 million in investments in 1998
as compared to $93 million in 1997.

Qualitative factors considered by the Compensation Committee included
the CEO's long term strategic plan for the Company, the CEO's success in
addressing the significant change occurring in the capital markets in 1998 and
obtaining increased liquidity for the Company during a period of a contraction
in liquidity. Finally, the Compensation Committee considered as a qualitative
factor the CEO's ability to develop teamwork among senior executives of the
Company with a common goal.

13
<PAGE>
RESTRICTED STOCK AWARDS

Restricted stock grants are designed to increase senior management's
stock ownership in the Company and to operate as an executive retention
mechanism for the Company's key members of management. The grants permit the
grantee to purchase a specified number of restricted shares of the Company's
common stock at $.01 per share. Grants of restricted stock to executive officers
in 1998 were generally made in an amount of approximately 50% of base salary,
with vesting one third each on the third, fourth and fifth anniversary of the
date of the grant.

STOCK OPTIONS

The Compensation Committee grants stock options to executive officers
upon the recommendation of senior management. Such grants are based upon the
level of each executive officer's position with the Company, an evaluation of
the executive officer's past and expected future performance, the number of
outstanding and previously granted options, and discussions with the executive
officer. The purpose of grants is to encourage long-term dedication to the
Company. The Compensation Committee did not grant stock options to the Company's
executive officers in 1998 because of the number of stock option awards in prior
years.

Compensation Committee:

Casey J. Sylla, Chairman
Louis P. Neeb
Kelvin L. Davis
Shelby Yastrow

14
<PAGE>
SHAREHOLDER RETURN PERFORMANCE GRAPH

The graph and table below compare the cumulative total shareholder
returns (assuming reinvestment of dividends before consideration of income
taxes) of the Company's Shares, the S&P 500 Index and the NAREIT Equity Index.
The graph assumes $100 invested on June 30, 1994 in the Company's Shares and
each of the indices. The stock price performance data shown on the graph below
are not necessarily indicative of future price performance.

[PERFORMANCE CHART]

MEASUREMENT PERIOD NAREIT EQUITY
(FISCAL YEAR COVERED) FFCA S&P 500 INDEX INDEX
--------------------- ---- ------------- -----
Measurement Pt 6/30/94 $100.00 $100.00 $100.00
12/31/94 86.17 104.87 97.97
12/31/95 119.75 144.29 112.93
12/31/96 158.14 177.42 152.75
12/31/97 165.87 236.61 183.69
12/31/98 158.39 304.22 151.52

NOTWITHSTANDING ANYTHING TO THE CONTRARY SET FORTH IN ANY OF THE
COMPANY'S PREVIOUS FILINGS UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE
SECURITIES EXCHANGE ACT OF 1934, AS AMENDED, THAT MIGHT INCORPORATE FUTURE
FILINGS BY REFERENCE, INCLUDING THIS PROXY STATEMENT, IN WHOLE OR IN PART, THE
PREVIOUS REPORT OF THE COMPENSATION COMMITTEE AND THE PERFORMANCE GRAPH AND
TABLE SHALL NOT BE INCORPORATED BY REFERENCE INTO ANY SUCH FILINGS.

15
<PAGE>
PROPOSAL NO. 2
AMENDMENT TO THE COMPANY'S
1995 STOCK OPTION AND INCENTIVE PLAN

At a meeting held on January 29, 1999, the Board unanimously approved a
resolution to amend the Company's 1995 Stock Option and Incentive Plan (the
"Stock Option Plan"), to increase the number of shares of the Company's common
stock reserved for issuance under the Stock Option Plan by 1,500,000 shares,
from 3,018,804 to 4,518,804 shares, subject to approval by the Company's
shareholders at the Meeting. The number of the Company's outstanding shares of
common stock has increased approximately 39% since the Stock Option Plan was
originally adopted. The amendment is being recommended because the Board
believes an additional number of shares of common stock reserved for issuance
under the Stock Option Plan is needed to permit the Company to continue
providing the Company's directors, executive officers, key employees and other
persons associated with the Company with adequate incentives and
performance-based compensation through grants of options. The proposed amendment
does not extend the term of the Stock Option Plan. The approval of the amendment
to the Stock Option Plan requires the affirmative vote of a majority of the
votes cast at the Meeting.

The following paragraphs summarize the principal features of the Stock
Option Plan. The summary is subject, in all respects, to the terms of the Stock
Option Plan. The Company will provide promptly, upon request and without charge,
a copy of the full text of the Stock Option Plan to each person to whom this
Proxy Statement is delivered. Requests should be directed to the Corporate
Secretary at the Company's principal executive offices at 17207 North Perimeter
Drive, Scottsdale, Arizona 85255-5402.

AWARDS UNDER THE PLAN

TERMS AND CONDITIONS OF OPTIONS; PAYMENT. Incentive stock options
granted under the Stock Option Plan are exercisable for a period of not more
than ten (10) years from the date of the grant. Any non-qualified options
granted under the Stock Option Plan are exercisable at such times, in such
amounts and during such periods as the Compensation Committee determines at the
date of the grant. If the optionee exercises the option, payment may be made
either in cash, certified check or other immediately available funds, with
previously issued Shares (valued as of the date of the option exercise), a
combination of cash, certified check or other immediately available funds and
Shares or any other consideration permitted under applicable law. The
Compensation Committee may allow a delay in payment up to thirty days from the
date the option is exercised; however, the company will not issue stock
certificates until it has received full payment for the Shares.

OPTION PRICE. The purchase price of each Share issued pursuant to the
exercise of an incentive stock option granted under the Stock Option Plan may
not be less than 100% of the fair market value per Share on the date of the
grant, as calculated pursuant to the Stock Option Plan. For purposes of the
Stock Option Plan, the fair market value of a Share as of a given date is the
average of the daily market price for the ten consecutive trading days
immediately preceding the valuation date. The purchase price of each Share
issued pursuant to the exercise of a non-qualified stock option granted under
the Stock Option Plan shall be determined by the Compensation Committee.

TRANSFERABILITY. Options granted under the Stock Option Plan may not be
transferred by the optionee except by will, the laws of descent and distribution
or pursuant to qualified domestic relation orders, and any option granted under
the Stock Option Plan shall be exercisable, during the lifetime of the holder,
only by such holder.

ADJUSTMENTS; MERGERS AND CONSOLIDATIONS. The Stock Option Plan provides
that in the event of any change in the outstanding Shares through merger,
consolidation, reorganization, recapitalization, stock dividend, stock split,
split-up, split-off, combination of Shares, exchange of Shares, or other like
change in capital structure of the company, an adjustment will be made to each
outstanding option or performance awards granted under the Stock Option Plan
such that each such option shall thereafter be exercisable for such securities,
cash and/or other property as would have been received in respect of the Shares
subject to such option had the option been exercised in full immediately prior
to such change.

VESTING. The period during which the right to exercise an option in
whole or in part vests shall be set by the Compensation Committee. Generally, no
portion of an option which is unexercisable at termination of employment shall

16
<PAGE>
thereafter become exercisable. While an option is generally only exercisable by
the optionee while he or she is an employee, the Compensation Committee may
allow exercise subsequent to an optionee's termination of employment, subject to
certain additional limitations.

ACCELERATION OF VESTING PROVISIONS. The Stock Option Plan authorizes
the Compensation Committee to accelerate the vesting of an outstanding option
upon written notice to the optionholder. An acceleration of the vesting period
in accordance with such authority would not affect the expiration date of the
option.

REDUCTION OF VESTING PERIOD. The Stock Option Plan provides that
outstanding options or performance awards will become immediately exercisable in
the event of a change of control of the Company. For purposes of the Stock
Option Plan unless otherwise defined in any applicable agreement, a change in
control would generally be deemed to have occurred when (a) any person becomes
the beneficial owner of 80% or more of the total number of Shares then
outstanding; (b) the Board or shareholders approve the sale of all or
substantially all of the assets of the Company or any merger, consolidation,
issuance of securities, the result of which would be the occurrence of an event
described in clause (a) above; or (c) as a result of, or in connection with, any
cash tender offer, exchange offer, merger or other business combination, sale of
assets or contested election, or any combination of the foregoing.

CANCELLATION AND REGRANT OF OPTIONS. The Stock Option Plan allows the
Compensation Committee to modify, extend or renew outstanding options granted
under the Stock Option Plan, or accept the surrender of options outstanding
under the Stock Option Plan (to the extent not theretofore exercised), and
authorize the granting of a like number of new options under the Stock Option
Plan in substitution of the original options, regardless of whether the vesting
schedules or exercise prices are the same or different from the original options
being surrendered. The grant of new options would be subject to the terms and
conditions of and within the limitations of the Stock Option Plan, and any
modification that would alter or impair any rights or obligations of the
optionholder under an option would be prohibited in the absence of such holder's
consent.

AMENDMENTS. The Board may from time to time, insofar as permitted by
law, revise or amend the Stock Option Plan in any way, except that no amendments
may be made without the approval of the shareholders if such amendments (i)
increase the maximum number of Shares which may be issued under the Stock Option
Plan (except as otherwise provided therein), (ii) change the manner of
determining the exercise price, (iii) extend the maximum period during which
options may be granted or exercised, (iv) materially modify the eligibility
requirements for participation in the Stock Option Plan, or (v) materially
increase the benefits accruing to participants under the Stock Option Plan.

In addition, non-employee directors of the Company will automatically
receive certain non-qualified stock options in an amount equal to 10% of the
dollar amount of the directors' annual retainer fee. The exercise price of the
options will equal the fair market value of the Company's common stock on the
date of grant. The amount of options received will be determined through the
application of the Black-Scholes option pricing model.

INCENTIVE STOCK OPTIONS. Incentive stock options will be designed to
comply with the provisions of the Code and will be subject to restrictions
contained in the Code, including a requirement that exercise prices are equal to
at least 100% of fair market value of the Shares on the grant date and a
ten-year restriction on the option term, but may be subsequently modified to
disqualify them from treatment as incentive stock options. To the extent the
aggregate fair market value of stock with respect to which incentive stock
options are exercisable for the first time by the optionee during any calendar
year under the Stock Option Plan exceeds $100,000, such option shall be treated
as non-qualified options to the extent required by the Code.

17
<PAGE>
may be repurchased by the Company at the original purchase price if the
conditions or restrictions are not met. In general, restricted stock may not be
sold, or otherwise transferred or hypothecated, until the restrictions are
removed or expire. Purchasers of restricted stock, unlike recipients of options,
will have voting rights and will receive dividends prior to the time when the
restrictions lapse.

FEDERAL INCOME TAX CONSEQUENCES

Under current federal income tax laws, neither the grant nor the
exercise of an option that qualifies for treatment as an incentive stock option
will result in the recognition of income by the optionee. To qualify for the
foregoing treatment, the optionee must hold shares acquired through the exercise
of an incentive stock option for at least two years from the date of the grant
of the option and at least one year from the date of its exercise. If an
optionee satisfies the holding period requirements, the sale of the shares
acquired through the exercise of the incentive stock option will result in
long-term capital gain (or loss) to the optionee. If an optionee does not
satisfy the holding period requirements, the optionee will recognize, at the
time of the disposition of the shares, ordinary income equal to the amount by
which the lesser of (i) the fair market value of the shares on the date of the
exercise and (ii) the fair market value of the shares on the date of disposition
exceeds the exercise price of the incentive stock option. Any gain realized in
excess of such ordinary income will be either long-term or short-term capital
gain depending on the optionee's holding period for the shares.

As a general matter, no deduction is permitted to the optionor as a
result of the grant or exercise of an incentive option. However, in the event an
optionee recognizes ordinary income for federal tax purposes in connection with
the disposition of shares acquired through exercise of an incentive stock option
under the circumstances discussed above, the Company will generally be entitled
to a deduction for federal income tax purposes equal to the amount of ordinary
income recognized by the optionee.

A grantee of a non-qualified stock option will not recognize taxable
income and the Company will not receive a deduction upon the grant of such
option. Upon an optionee's exercise of a non-qualified stock option: (i) the
optionee will receive ordinary income in an amount equal to the difference
between the fair market value on the exercise date and the exercise price of the
shares; and (ii) if certain conditions are satisfied, the Company will be
entitled to a tax deduction in an amount equal to the amount of income realized
by the optionee. Following exercise, the optionee will realize gain or loss at
disposition in an amount equal to the difference between the disposition price
and the basis of the shares.

The federal tax law is subject to changes in the Code and the
regulations promulgated by the Internal Revenue Service, and in court and
administrative interpretation.

THE BOARD RECOMMENDS THAT THE SHAREHOLDERS VOTE "FOR" PROPOSAL NO. 2

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<PAGE>
PROPOSAL NO. 3
RATIFICATION OF SELECTION OF INDEPENDENT AUDITORS

The Board, upon the recommendation of the Audit Committee, has selected
Arthur Andersen LLP to serve as independent auditors of the Company for the
fiscal year ending December 31, 1999. The shareholders of the Company are being
asked to ratify this selection at the Meeting. Arthur Andersen LLP has served as
the Company's independent auditors since the Company's inception.
Representatives of Arthur Andersen LLP will be present at the Meeting and will
have the opportunity to make a statement if they desire to do so and will be
available to respond to appropriate questions from shareholders.

Although it is not required to do so, the Board is submitting its
selection of the Company's independent auditors for ratification by the
shareholders at the Meeting in order to ascertain the views of shareholders
regarding such selection. A majority of the votes cast at the Meeting, if a
quorum is present, will be sufficient to ratify the selection of Arthur Andersen
LLP as the Company's independent auditors for the fiscal year ending December
31, 1999. Whether the proposal is approved or defeated, the Board may reconsider
its selection.

THE BOARD RECOMMENDS THAT THE SHAREHOLDERS VOTE "FOR" PROPOSAL NO. 3

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
AND MANAGEMENT

The following table sets forth information as of February 18, 1999,
regarding beneficial ownership of Shares by (i) each director of the Company,
(ii) the CEO and each of the Named Executive Officers, (iii) all directors and
executive officers of the Company as a group, and (iv) all persons known to the
Company to be the beneficial owner of 5% or more of the outstanding Shares of
the Company. Unless otherwise noted in the footnotes following the table, the
persons as to whom information is given have sole voting and investment power
over the Shares beneficially owned.

Shares of Common
Stock Beneficially Percent
Name Owned(1)(2) of Class
- ---- ----------- --------
Morton H. Fleischer ............................ 1,464,202(3) 2.6%
Robert W. Halliday ............................. 409,602(4) *
Willie R. Barnes ............................... 12,417 *
Donald C. Hannah ............................... 17,617 *
Dennis E. Mitchem .............................. 9,225 *
Louis P. Neeb .................................. 25,001 *
Kenneth B. Roath ............................... 16,432 *
Casey J. Sylla ................................. 17,443 *
Shelby Yastrow ................................. 11,797 *
John R. Barravecchia ........................... 252,039 *
Christopher H. Volk ............................ 303,891 *
Stephen G. Schmitz ............................. 224,953 *
Dennis L. Ruben ................................ 199,453 *
Kelvin L. Davis ................................ 5,272,312(5) 9.2%
1999 Avenue of the Stars, Suite 1200
Los Angeles, California 90067
Colony SB, LLC ................................. 5,270,039(6) 9.2%
1999 Avenue of the Stars, Suite 1200
Los Angeles, California 90067
Directors and executive officers as a group .... 8,314,733 14.2%
(16 persons)
- ----------
19
<PAGE>
* Less than one percent
(1) Share amount and percentage figures are rounded to the nearest whole
number. All Shares not outstanding but which may be acquired by such
shareholder within 60 days by the exercise of any stock option or any other
right, are deemed to be outstanding for the purposes of calculating
beneficial ownership and computing the percentage of the class beneficially
owned by such stockholder, but not by any other shareholder. The foregoing
Share amounts include the following number of Shares which may be acquired
pursuant to stock options and warrants exercisable within 60 days of
February 18, 1999: Mr. Fleischer, 333,333 Shares; Mr. Halliday, 54,743
Shares; Mr. Mitchem, 7,642 Shares; Mr. Yastrow, 2,273 Shares; Mr.
Barravecchia, 222,666 Shares; Mr. Volk, 267,541 Shares; Mr. Schmitz,
219,333 Shares; Mr. Ruben, 179,333 Shares; and all executive officers and
directors as a group, 2,890,431 Shares. The Shares beneficially owned by
Messrs. Barnes, Hannah, Neeb, Roath, and Sylla include 10,569 Shares
representing stock options currently exercisable by each individual. The
Shares beneficially owned by Mr. Davis include Shares beneficially owned by
Colony SB, LLC ("Colony") and include 1,476,908 Shares which may be
acquired pursuant to an immediately exercisable warrant agreement, and
2,273 Shares representing stock options currently exercisable by Mr. Davis.
See footnotes (5) and (6) below.
(2) Does not include Shares awarded to employees as the matching portion of the
Company's 401(k) plan.
(3) Includes an aggregate of 10,000 Shares held by Donna H. Fleischer, the wife
of Mr. Fleischer.
(4) Includes 40,000 Shares held by the Halliday Foundation, of which Mr.
Halliday is a trustee, and 100,000 Shares held by a charitable remainder
trust, of which Mr. Halliday is a trustee.
(5) Includes an aggregate of 3,793,131 Shares currently owned by Colony,
1,476,908 Shares which Colony has the right to acquire pursuant to an
immediately exercisable warrant agreement dated March 13, 1998, and 2,273
Shares representing stock options currently exercisable by Mr. Davis. Mr.
Davis shares the power to vote and the power to dispose of Colony's Shares
with another affiliate of Colony. See footnote (6) below.
(6) These Shares consist of 3,793,131 Shares currently owned by Colony, and
1,476,908 Shares which Colony has the right to acquire pursuant to an
immediately exercisable warrant agreement dated March 13, 1998. Based upon
a Schedule 13D, dated March 23, 1998, these Shares are also deemed to be
beneficially owned by Colony GP III, Inc., Colony Capital III, L.P., Colony
Investors III, L.P., Thomas J. Barrack, Jr. and Kelvin L. Davis. The
address of these beneficial owners is 1999 Avenue of the Stars, Suite 1200,
Los Angeles, California 90067. As the sole stockholders of Colony GP III,
Inc., Mr. Barrack and Mr. Davis are deemed to share the power to vote and
dispose of, or to direct the vote or disposition of, Colony's Shares.

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

ADMINISTRATIVE SERVICES AGREEMENTS. The Company has entered into
administrative services agreements (the "Administrative Agreements") with the
following entities: FFCA Management Company Limited Partnership; FFCA
Participating Management Company Limited Partnership; Perimeter Center
Management Company; Franchise Finance Corporation of America II; and Franchise
Finance Corporation of America III (collectively the "Companies"). The Companies
are affiliates of the Company primarily due to Mr. Fleischer's individual
ownership interest or interest as an individual general partner of such
entities. Mr. Fleischer and other executive officers and directors of the
Company also serve as executive officers and directors in certain of the
Companies.

The Administrative Agreements appoint the Company as administrator of
the Companies. As administrator, the Company supervises all aspects of the
operations of such Companies. The Company charges for all personnel expenses
directly attributable to the individual company and allocates overhead to the
Companies pursuant to a predetermined formula, as determined in the Company's
reasonable discretion. The Company also adds a profit percentage not to exceed
20% of the sum of the total expenses charged to each individual entity. In the
1998 fiscal year, the above Companies paid approximately $360,000 to the Company
pursuant to the Administrative Agreements.

MORTGAGE PAYABLE TO AFFILIATE. In 1988, the Company purchased land from
Scottsdale Land Trust Limited Partnership ("SLT") for the construction of the
Company's headquarters (collectively the "FFCA Premises"). The purchase of the
land for and construction of the FFCA Premises were financed through a mortgage
loan provided to the Company by SLT. The mortgage loan on the FFCA Premises
currently has a principal balance of $8.5 million and provides for the payment
of interest only, at the rate of 10% per year, until May 2000, at which time the

20
<PAGE>
entire principal amount is due. SLT's general partner is FFCA Management Company
Limited Partnership. Morton H. Fleischer, the Company's Chairman of the Board
and Chief Executive Officer, serves as a general partner of FFCA Management
Company Limited Partnership.

RELATED PARTY EMPLOYMENT. Jeffrey Fleischer, son of Morton H.
Fleischer, serves as Vice President of the Company. In 1998, Jeffrey Fleischer
received total cash compensation in the amount of $181,126 from the Company.

SOLICITATION OF PROXIES

This solicitation is being made by mail on behalf of the Board, but may
also be made without additional remuneration by officers or employees of the
Company by telephone, telegraph, facsimile transmission or personal interview.
The expense of the preparation, printing and mailing of this Proxy Statement and
the enclosed form of Proxy and Notice of Annual Meeting, and any additional
material relating to the Meeting which may be furnished to shareholders by the
Board subsequent to the furnishing of this Proxy Statement, has been or will be
borne by the Company. The Company will reimburse banks and brokers who hold
Shares in their name or custody, or in the name of nominees for others, for
their out-of-pocket expenses incurred in forwarding copies of the proxy
materials to those persons for whom they hold such Shares. To obtain the
necessary representation of shareholders at the Meeting, supplementary
solicitations may be made by mail, telephone or interview by officers of the
Company or selected securities dealers. In addition, the Company has retained
D.F. King & Co., Inc. ("D.F. King") to solicit proxies from shareholders by
mail, in person and by telephone. The Company will pay D.F. King a fee of $8,000
for its services, plus reimbursement of reasonable out-of-pocket expenses
incurred in connection with the proxy solicitation. It is anticipated that the
cost of any other supplementary solicitations, if any, will not be material.

ANNUAL REPORT

The Company has mailed the Company's Annual Report for the 1998 fiscal
year to shareholders along with this Proxy Statement. THE COMPANY WILL, UPON
WRITTEN REQUEST AND WITHOUT CHARGE, PROVIDE TO ANY PERSON SOLICITED HEREUNDER A
COPY OF THE COMPANY'S ANNUAL REPORT ON FORM 10-K FOR THE YEAR ENDED DECEMBER 31,
1998, INCLUDING FINANCIAL STATEMENTS AND FINANCIAL STATEMENT SCHEDULES, AS FILED
WITH THE SECURITIES AND EXCHANGE COMMISSION. Requests should be addressed to
Ronald E. Davis, Vice President of Corporate Communications of the Company,
17207 North Perimeter Drive, Scottsdale, Arizona 85255.

SHAREHOLDER PROPOSALS FOR 2000 ANNUAL MEETING

Shareholders are entitled to present proposals for action at
shareholders' meetings if they comply with the requirements of the proxy rules.
In connection with this year's Meeting, no shareholder proposals were presented.
Any proposals intended to be presented at the Company's Annual Meeting of
Shareholders to be held in the year 2000 must be received at the Company's
offices on or before November 12, 1999, in order to be considered for inclusion
in the Company's proxy statement and form of proxy relating to such meeting.

The accompanying proxy card grants the proxy holders discretionary
authority to vote on any matter raised at the Meeting. If a shareholder intends
to submit a proposal at the Company's 2000 Annual Meeting of Shareholders, which
proposal is not intended to be included in the Company's proxy statement and
form of proxy relating to such meeting, the shareholder must give proper notice
no later than January 14, 2000. If a shareholder fails to submit the proposal by
such date, the Company will not be required to provide any information about the
nature of the proposal in its proxy statement, and the proposal will not be
considered at the 2000 Annual Meeting of Shareholders.

Proposals should be sent to Christopher H. Volk, Executive Vice
President and Secretary of the Company, at 17207 North Perimeter Drive,
Scottsdale, Arizona 85255.

21
<PAGE>
OTHER MATTERS

The Board is not aware of any matters to come before the Meeting, other
than those specified in the Notice of Annual Meeting. However, if any other
matter requiring a vote of the shareholders should arise at the Meeting, it is
the intention of the persons named in the accompanying Proxy to vote such Proxy
in accordance with their best judgment.

NOTICE TO BANKS, BROKER-DEALERS AND
VOTING TRUSTEES AND THEIR NOMINEES

Please advise the Company whether other persons are the beneficial
owners of the Shares for which proxies are being solicited from you, and, if so,
the number of copies of this Proxy Statement and other soliciting materials you
wish to receive in order to supply copies to the beneficial owners of the
Shares.

IT IS IMPORTANT THAT PROXIES BE RETURNED PROMPTLY. SHAREHOLDERS,
WHETHER OR NOT THEY EXPECT TO ATTEND THE MEETING IN PERSON, ARE URGED TO
COMPLETE, DATE AND SIGN THE ENCLOSED PROXY CARD AND RETURN IT PROMPTLY IN THE
ENVELOPE PROVIDED FOR THAT PURPOSE. BY RETURNING YOUR PROXY CARD PROMPTLY YOU
CAN HELP THE COMPANY AVOID THE EXPENSE OF FOLLOW-UP MAILINGS TO ENSURE A QUORUM
SO THAT THE MEETING CAN BE HELD. SHAREHOLDERS WHO ATTEND THE MEETING MAY REVOKE
A PRIOR PROXY AND VOTE THEIR PROXY IN PERSON AS SET FORTH IN THIS PROXY
STATEMENT.

By Order of the Board of Directors

/s/ Christopher H. Volk

Christopher H. Volk, Secretary

Scottsdale, Arizona
March 31, 1999

22
<PAGE>
PROXY/VOTING INSTRUCTION CARD

FRANCHISE FINANCE CORPORATION OF AMERICA
c/o Gemisys Transfer Agents, P.O. Box 3287, Englewood, CO 80155-3287

ANNUAL MEETING DATE: MAY 12, 1999
THIS PROXY IS SOLICITED ON BEHALF OF THE COMPANY'S BOARD OF DIRECTORS

The undersigned shareholder of Franchise Finance Corporation of America (the
"Company"), a Delaware corporation, hereby constitutes and appoints Christopher
H. Volk and John R. Barravecchia, and each of them, proxies, with full power of
substitution, for and on behalf of the undersigned to vote, as designated below,
according to the number of shares of the Company's $.01 par value common stock
held of record by the undersigned on March 17, 1999, and as fully as the
undersigned would be entitled to vote if personally present, at the Annual
Meeting of Shareholders to be held at The Scottsdale Princess Resort, 7575 East
Princess Drive, Scottsdale, Arizona on Wednesday, May 12, 1999 at 10:00 a.m.
local time, and at any postponements or adjournments thereof.

THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED HEREIN BY
THE UNDERSIGNED. IF PROPERLY EXECUTED AND NO DIRECTION IS MADE, THIS PROXY WILL
BE VOTED IN FAVOR OF THE ELECTION OF ALL LISTED NOMINEES TO THE BOARD OF
DIRECTORS AND FOR EACH OF THE OTHER ITEMS SET FORTH ON THE PROXY.

Please mark boxes [x] in ink. Sign, date and return this Proxy promptly, using
the enclosed envelope.

1. Election of Directors.

[ ] FOR ALL NOMINEES LISTED BELOW [ ] WITHHOLD AUTHORITY
(except as marked to the contrary below) to vote all nominees listed below

(INSTRUCTION: To withhold authority to vote for any individual nominee write
that nominee's name on the space provided below)

- --------------------------------------------------------------------------------

Morton H. Fleischer, Robert W. Halliday, Willie R. Barnes, Kelvin L. Davis,
Dennis E. Mitchem, Louis P. Neeb, Kenneth B. Roath, Casey J. Sylla and
Shelby Yastrow

2. Proposal to amend the Company's 1995 Stock Option and Incentive Plan (the
"Stock Option Plan") to increase the number of shares of the Company's
common stock reserved for issuance under the Stock Option Plan by 1,500,000
shares, from 3,018,804 shares to 4,518,804 shares.

[ ] FOR [ ] AGAINST [ ] ABSTAIN

3. Proposal to ratify the selection of Arthur Andersen LLP as the Company's
independent auditors for the fiscal year ending December 31, 1999.

[ ] FOR [ ] AGAINST [ ] ABSTAIN

4. In the discretion of such proxy holders, upon such other business as may
properly come before the Meeting or any and all postponements or
adjournments thereof.
<PAGE>
The undersigned hereby acknowledges receipt of the Notice of Annual Meeting of
Shareholders, dated March 31, 1999 and the Proxy Statement furnished therewith.

Please sign exactly as name appears hereon. When shares are held by joint
tenants, both should sign. Executors, administrators, trustees and other
fiduciaries, and persons signing on behalf of corporations or partnerships,
should so indicate when signing.

Dated , 1999
----------------------------------

---------------------------------------------
Authorized Signature

---------------------------------------------
Title

---------------------------------------------
Authorized Signature

---------------------------------------------
Title

TO SAVE THE COMPANY ADDITIONAL VOTE SOLICITATION EXPENSES, PLEASE SIGN, DATE AND
RETURN THIS PROXY PROMPTLY, USING THE ENCLOSED ENVELOPE.

NON-VOTING INSTRUCTIONS

[ ] ANNUAL MEETING. Please check here to indicate that you plan to
attend the Annual Meeting of Shareholders on May 12, 1999.