Extreme Motorsports Receives Large Manufacturing Contract & Updates on Progress

BAKERSFIELD, Calif., July 1 -- Extreme Motorsports of California, Inc. (Pink Sheets: EMOC) ("Xtreme" or the "Company"), has received a large manufacturing contract from Senatore Trailers LLC.

At the beginning of this 2008 year, Extreme Motorsports of California, Inc. began negotiating an agreement for use of the patent rights with Senatore Trailers from New York State. Senatore Trailers approached the Company about building a patented utility trailer that they owned and manufactured. An agreement was negotiated to allow their patent rights to be re-engineered and trailers manufactured to meet the needs of the existing dealer base started by Senatore Trailers. The agreement consists of the following points:

1) To re-engineer the trailer to provide for a hydraulic load-unload capability from a full-size pick-up truck bed, expanding from 4'x6' to 6'x10' once unloaded. Construction is to be all-aluminum and it is to be mass-produced through advanced manufacturing methods, similar to the sandcars, already built through Xtreme Motorsports.

2) To create and control a worldwide website to conduct the sales, tracking, shipping and payment of the product for consumers and dealers. This new website will have video demonstrations of how the trailer operates and how it is manufactured.

3) To start manufacturing immediately upon completion of engineering to provide trailers to the existing dealer base. Manufacturing to begin early in July and will be limited to 50 units per month for the first three months to allow the Company to "tool up" to meet the planned 2000 -- 2500 trailers per year requirement within the first 12 months.

4) To assist in the retail cost structure of the trailers to meet the needs of the clients and the consumers.

5) To create additional dealerships in selected states on the West Coast and overseas.

The Company is excited to announce the tremendous progress of this agreement! Around July 8th, manufacturing of the first unit(s) to allow for the final filming of the website videos will begin. Around the middle of July our website is expected to be operational to allow the existing registered distributors and dealers to begin ordering and pre-paying by a selection of online payment options. The trailers will be competitively priced at a retail price of $4,995 each for the base model and options such as a trailer dump bed, a variety of powder-coated finished and dual-axle, heavy-duty models are being considered that would generate additional revenues. Since all orders are pre-paid we are planning that the first week in August, with the distributors and dealers that are already in place (in excess of 45 dealers across the US), our first month should generate approximately $250,000 in revenues and grow steadily to a conservative estimate of $829,000 per month through the rest of the year. These revenues do not include consumers being able to order the trailer directly online and pre-pay with a selection of online payment options and also do not include additional dealers that the Company is lining up now. Our conservative estimate plans on sales to reach 3,000 trailer units per year within 18 months, generating revenues of almost $15,000,000 per year.

In order to properly manage the manufacturing of the trailers, Extreme Fabrication LLC, was formed with Extreme Motorsports of California, Inc. as one of the owners. This entity will handle the management of the website, sales, shipping and delivery to the customers for a smooth flow of products without interfering with Xtreme Motorsports' existing projects. The agreement also accommodates approximately $1.8 million in new, state-of-the-art equipment, which will allow for lights out operation and robotic welding, as well as additional factory space to facilitate the production numbers. Watch for the new website being uploaded soon so the public can get its first look at this magnificent product.