SOURCE: Franchise Capital Corporation

March 14, 2007 12:39 ET

Franchise Capital Corporation Files Form N-54C Notification of Withdrawal of Business Development Company Election

TEMECULA, CA -- (MARKET WIRE) -- March 14, 2007 --Franchise Capital Corporation (PINKSHEETS: FCCN) today announced that at the company's annual meeting of shareholders held on March 13, 2007, a majority of the holders of the company's common stock approved a proposal to withdraw Franchise Capital's election to be treated as a business development company (BDC).

Franchise Capital has filed a Form N-54C notifying the Securities and Exchange Commission that the company has withdrawn its election to be subject to sections 55 through 65 of the Investment Company Act of 1940. The withdrawal is effective immediately, and Franchise Capital is currently conducting business as an operating company rather than as a business development company subject to the Investment Company Act.

At the special meeting, the company's inspector of election totaled the number of shares represented at the meeting, and concluded that a total of 781,326,143 shares of Franchise Capital's common stock were represented in person and/or by proxy. This represented a quorum for the purpose of conducting valid shareholder business at the meeting, since as of February 21, 2007, there were a total of 921,183,413 shares of Franchise Capital common stock issued and outstanding. The following voting results were then announced: 781,169,297 shares voted in favor, 55,912 shares voted against and 100,934 shares abstained. With a majority of the outstanding common stock voting in favor, the proposal was approved.

In January 2007, Franchise Capital executed a definitive agreement to acquire the issued and outstanding shares of Aero Exhaust Inc., a leader in performance exhaust airflow technology and NASCAR Performance Partner. The acquisition is expected to close in the second quarter of 2007.

"We are pleased to have conducted our shareholders meeting and to have successfully withdrawn the company's BDC election," said Franchise Capital chief executive officer Steven R. Peacock. "This is another important step in the clean-up process for Franchise Capital as we position it to become an effective public vehicle for Aero Exhaust.

"It was also a great pleasure to meet and speak with the shareholders who were able to attend the meeting. We look forward to continuing our substantive dialogue with stockholders and the public markets through the period leading up to the close of our acquisition of Aero Exhaust," added Mr. Peacock.

After the business of the meeting was conducted, Mr. Peacock opened the floor to questions from shareholders. Among the topics addressed was the amount of capital currently drawn down by Aero as part of the $1.5 million loan made available by Franchise Capital. Mr. Peacock estimated the total amount drawn down to be approximately $1.2 million thus far.

Mr. Peacock also addressed the progress of filing Franchise Capital's delinquent quarterly and year-end reports as part of the clean up of the company. The company is working with its independent auditor and expects to begin filing the reports shortly. Franchise Capital anticipates having all of the delinquent reports filed by the end of March.

Shareholders can still access Mr. Peacock's recent interview with Equity Digest at and in the "Recent News" section on the company's website at

To sign up to receive information by email directly from Franchise Capital Corporation whenever new press releases, investor newsletters, SEC filings, and other written material is issued, please visit

About Aero Exhaust:

Aero Exhaust is a world leader in performance exhaust airflow technology, manufacturing and distributing the most technologically advanced muffler on the market. Its product lines are built to the highest industry standards and offer the consumer a lifetime warranty. Aero Exhaust has been issued U.S. and Australian patents on its innovations and development in the exhaust industry, and its mufflers are available worldwide through major retailers, mass merchant centers, automotive aftermarket supply stores and wholesalers. Aero Exhaust mufflers are an exclusive National Association for Stock Car Auto Racing (NASCAR) Performance product and carry the prestigious NASCAR brand on product, packaging and related media. NASCAR legend Rusty Wallace is the official spokesperson for Aero Exhaust products. Additional information on Aero Exhaust's products, race team, and motorsports ventures can be found on its corporate web site,

Safe Harbor Statement: The statements in this release that relate to future plans, expectations, events, performance and the like are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and the Securities Exchange Act of 1934. Actual results or events could differ materially from those described in the forward-looking statements due to a variety of factors, including the lack of funding, inability to complete required SEC filings, and others set forth in the Company's report on Form 10-K/A for fiscal year 2005 filed with the Securities and Exchange Commission.

Contact Information

    Gemini Financial Communications, Inc.
    A. Beyer
    Email Contact