FENDER HISTORY 
(adapted from the Official Fender Website)

                   In the 1940's, a California inventor named Leo Fender had made some custom
                   guitars and amplifiers in his radio shop. Eventually, Leo would create the
                   world's very first instrument amplifiers with built-in tone controls. More
                   importantly, though, was Leo's vision of better guitar. With his knowledge of
                   existing technologies, he knew he could improve on contemporary amplified
                   hollow-body instruments . . . and improve upon them, he did. In 1951, he
                   introduced the Broadcaster, the prototype solid-body guitar that would
                   eventually become the legendary Telecaster®. The Tele®, as it became
                   affectionately known, was the first solid-body electric Spanish-style guitar
                   ever to go into commercial production. Soon to follow the Tele were the
                   revolutionary Precision Bass® guitar in 1951, and the Stratocaster® in 1954.

                   In 1965, because of poor health, Leo Fender sold his company to corporate
                   giant CBS. Over the next two decades, Fender Musical Instruments
                   experienced some tremendous growth. But as time wore on, CBS's lack of
                   commitment and real understanding of music and musicians was becoming
                   apparent.

                   In 1981, CBS recruited a new management team to "re-invent" Fender. William
                   Schultz was soon named President, and was supported by associates William
                   Mendello and Kurt Hemrich. They had developed a five-year business plan
                   based on the idea of increasing Fender's presence in the marketplace by
                   dramatically improving quality and making a significant commitment to
                   research and development. This association continued until CBS decided to
                   divest itself from the non-broadcast media business.

                   So, in 1985, a group of employees and investors led by William Schultz
                   purchased the company from CBS. This sale put Fender in the hands of a
                   small group of musically dedicated people who have committed their lives to
                   creating the world's best guitars and amplifiers.

                   The team had to start from scratch - there were no buildings or machines
                   included in the deal. They owned only the name, the patents, and the parts
                   that were left over in stock. Supported by a core group of loyal employees,
                   dealers and suppliers - some of whom had been with the company since Leo
                   Fender began making guitars and amplifiers - Bill Schultz and his colleagues
                   set out to re-build an American icon.

                   Initially, Fender imported their guitars from offshore manufacturers who had
                   proven their ability to produce affordable, viable instruments. But the quest
                   for even more control over quality soon led to the construction of Fender's
                   flagship domestic factory in Corona, California. Eventually, Fender would
                   build a second modern manufacturing facility in Ensenada, Baja California,
                   Mexico, with the goal of being able to build quality instruments and offer
                   them at more budget-oriented prices.

                   In 1987, Fender acquired Sunn, a storied line of amplifiers whose past
                   endorsees have included The Who, Jimi Hendrix and The Rolling Stones.
                   This jump-started Fender's re-entry into the amplifier business by making
                   accessible Sunn's manufacturing facilities in Lake Oswego, Oregon. But this
                   was still an early stage of the "new" Fender, so Schultz put the Sunn line of
                   amps on the shelf until the Fender name had been re-established as the
                   world's leading amplifier.

                   Fender has always recognized the importance of an open-door policy for the
                   professional musician. When artists first started requesting specific features
                   for their guitars, they were accommodated on an individual basis. These
                   relationships led to the formalizing of Fender's custom operation in 1987.
                   Today, the world's greatest guitarists work with the renowned Fender Custom
                   Shop in Corona, California, to create their dream instruments. Recently,
                   Fender has added amplifiers to the list of custom-made instruments that can
                   be produced at the Custom Shop in Corona.

                   In 1991, Fender moved its corporate headquarters from Corona to Scottsdale,
                   Arizona. From here, administration, marketing, advertising, sales and export
                   teams oversee the operations of Fender's satellite facilities around the world,
                   which now include the locations in the United States (California, Tennessee,
                   New York and Rhode Island), as well as international operations in:
                   Ensenada, Baja California, Mexico; London, England; Dusseldorf, Germany;
                   Suresnes, France; Brussels; Japan; Korea; and China.

                   Also brought to Scottsdale at this time was Fender's Amplifier and Pro Audio
                   Research & Development. With guitar amplifiers, Fender sets the standard for
                   sound and value. Its R & D staff has pioneered many technological
                   advancements in developing amplifiers that meet the needs of the performing
                   musician. In late 1992, the Amp Custom Shop was opened in Scottsdale,
                   Arizona, to offer custom and limited editions of professional amplifiers for
                   working musicians.

                   Recognizing that country music and acoustic guitars were increasing in
                   popularity, Fender expanded upon its acoustic guitar line. In addition to
                   working with respected manufacturers in Japan, Korea and China to produce
                   quality acoustic guitars, the company has become the exclusive North
                   American distributor of the prestigious Manuel Rodriguez line of
                   nylon-stringed guitars, which have been hand-crafted in Spain by the
                   Rodriguez family since 1905. These additions have put the company in an
                   excellent position for growth within the acoustic guitar market.

                   Founded in a loft in New York City in 1952, Guild Guitar Company continues
                   to be known for its quality instruments and exceptional value. Faced with
                   internal financial troubles in the early 1990's, Guild management had decided
                  to sell the company. Fender acquired Guild in 1995, signaling a return to
                   ownership by a group of people dedicated to producing the finest value in
                   American-made acoustic and electric guitars. Today, Guilds are still being
                  produced at its historic, 60,000 square-foot facility in Westerly, Rhode Island.

                   1998 would prove to be a banner year for Fender and its subsidiaries. With
                   Fender amplifiers once again enjoying a very strong presence in the market
                   place, it was now time to dust off the Sunn line of amps. R&D had spent the
                   previous three years studying the original Sunn products and developing
                   prototype models that faithfully replicated the trademark Sunn sound. The
                   timing was right, and Fender introduced the new Sunn line of amplifiers to an
                   immediate industry acclaim.

                   And for Guild, 1998 brought the expansion of its Custom Shop in Nashville,
                   Tennessee. First opened in 1996, the new Guild Custom Shop boasts an 8,000
                   square-foot , climate controlled facility near downtown Nashville that allows a
                   great deal of extra space for production and storage of raw materials.

                   Guild had also introduced DeArmond guitars in 1998. Fender had purchased
                   the DeArmond brand of musical instrument pickups in 1997, and then
                   combined the company with Guild to produce an alternative line of high
                   quality, affordable guitars and basses that are modeled after Guild designs.
                   The guitars themselves are built and assembled in Korea before being sent
                   back to Corona, where they are fitted with American-made DeArmond
                   pickups. Following their successful test runs in European and Asian markets,
                   DeArmond guitars were introduced to American and Canadian consumers
                  and received instant acclaim as an exceptional value.

                   But the biggest event for Fender in 1998 was the opening of its new
                   state-of-the-art manufacturing facility in Corona. The 177,000 square-foot
                   facility was built on a nineteen acre site, with over half of that space set aside
                   for future growth, and is the culmination of a vision that at times seemed
                   almost impossible. The entire line of American-made Fender guitars are built
                   at the Corona factory, which is capable of making over 350 guitars each day.
                   In addition, the Corona facility utilizes the innovative UVOXÔ system, which
                   combines ultraviolet light, a special scrubber process, and a carbon bed
                   absorption system to help ensure that the air emitted from the factory is 95%
                   clean. The new factory is not only a state-of-the-art manufacturing facility,
                   but a tribute to how a group of dedicated individuals, when they set their
                   minds to it, can create the "impossible".

                   The Fender Custom Shop also shares space at the new facility. Over fifty
                   artisans now work at the Custom Shop, offering the world's finest custom
                   made instruments to professional musicians, as well as a complete line of
                   hand-crafted replications of classic Fender models. And to complete the
                   Corona operation, the amplifier Custom Shop was brought back from
                   Scottsdale and folded into the guitar Custom Shop.

                   Simultaneously, a new 70,000 square-foot addition was completed at the
                   Ensenada facility. The extra space was added to bring amplifier production,
                   aside from those produced at the Custom Shop, into one main facility.

                  During the past decade, Fender has grown dramatically in sales and stature.
                   The company manufactures and distributes virtually everything that a
                   guitarist needs to perform, from the guitar, strings and accessories, to the pro
                   audio products including amplifiers and mixing boards. Today, under
                   Schultz's direction, Fender Musical Instruments Corporation is a world leader
                   in the manufacturing and distribution of electric guitars and amplifiers.

                   Fender became the world leader by defining the sounds we hear, meeting the
                   needs of musicians, creating quality products and backing them up with
                   service and stability. As Fender Musical Instruments Corporation forges
                   through the 1990's and into the 21st century, its management team will
                   maintain Fender's number-one status through a winning combination of
                   business acumen and a love of music.