PRELIMINARY PROXY MATERIAL Dated April ___, 1998 PROXY THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF AMERICAN ASSET ADVISERS TRUST, INC. Special Meeting of Shareholders - April ___, 1998 The undersigned shareholder of AMERICAN ASSET ADVISERS TRUST, INC., a Maryland corporation, hereby acknowledges receipt of the Notice of Special Meeting of Shareholders and Proxy Statement for the Special Meeting of Shareholders to be held on _____________, April ___, 1998 at ___:00 __.m. Local Time, at Eight Greenway Plaza, Suite 824, Houston, Texas (telephone no. (713) 850-1400), and hereby appoints H. Kerr Taylor and Timothy W. Kelley, and each of them, proxies and attorneys-in-fact, with full power to each of substitution, on behalf and in the name of the undersigned, to represent the undersigned at said Special Meeting and at any adjournment or adjournments thereof, and to vote all shares of Common Stock which the undersigned would be entitled to vote if then and there personally present, on the matters set forth on the reverse side. Either of such attorneys or their substitutes has and may exercise all of the powers of said attorneys-in-fact hereunder. [SEE REVERSE SIDE] ________________________________________ CONTINUED AND TO BE SIGNED ON REVERSE SIDE [ X ] Please mark votes as in this example. Recommendation of This Proxy will be voted as directed or, if no the direction is indicated, will be voted FOR Board of Directors proposals 1 through 4, inclusive, below, and as said proxies deem advisable on such other matters as may properly come before the meeting. Management will not vote proxies voting against the transaction for adjournment of the meeting. FOR 1. TO APPROVE THE ACQUISITION OF THE ADVISER, AMERICAN ASSET ADVISERS REALTY CORPORATION, A TEXAS CORPORATION, BY THE CORPORATION AND (THE "THE COMPAMY BECOMING A SELF-ADMINISTERED AND SELF-MANAGED REIT"). [ ] FOR [ ] AGAINST [ ] ABSTAIN FOR 2. TO AMEND ARTICLE III, SECTION 3.13 OF THE CORPORATION'S BYLAWS TO AUTHORIZE THE ACQUISITION. [ ] FOR [ ] AGAINST [ ] ABSTAIN FOR 3. TO AMEND ARTICLE III OF THE COMPANY'S BYLAWS TO CHANGE INVESTMENT POLICY RESTRICTIONS REGARDING THE NATURE AND LEASING OF PROPERTIES. [ ] FOR [ ] AGAINST [ ] ABSTAIN FOR 4. TO AMEND ARTICLE I OF THE CORPORATION'S ARTICLES OF INCORPORATION TO CHANGE THE CORPORATION'S NAME TO "AMREIT, INC." [ ] FOR [ ] AGAINST [ ] ABSTAIN (This proxy should be marked, dated, signed by the shareholder(s) exactly as his or her name appears hereon, and returned promptly in the enclosed envelope. Persons signing in a fiduciary capacity should so indicate. If shares are held by joint tenants or as community property, both should sign.) Signature: Date: Signature: Date: (Joint owners must each sign. Please sign exactly as your name(s) appear(s) on this Proxy. When signing as an attorney, trustee, executor, administrator or guardian, please give your full title. If signer is a corporation, please sign the full corporation name and full title of signing officer.)