SOURCE: Franchise Capital Corporation

January 18, 2007 09:14 ET

Franchise Capital Corporation Announces a Definitive Agreement With Aero Exhaust, a World Leader in Automotive Exhaust Technology and NASCAR Performance Partner

TEMECULA, CA -- (MARKET WIRE) -- January 18, 2007 -- Franchise Capital Corporation (PINKSHEETS: FCCN) today announced that it has reached a definitive agreement with Aero Exhaust, Inc., a world leader in performance exhaust airflow technology, under which Franchise Capital Corporation is expected to exchange up to 95% of its total capital stock in exchange for all of Aero Exhaust's issued and outstanding shares.

The execution of the definitive agreement has been disclosed in a Current Report on Form 8-K filed with the Securities and Exchange Commission.

"We are pleased to have reached this definitive agreement with Aero Exhaust and look forward to completing the acquisition, which is expected to occur in the second quarter of this year," stated Steven R. Peacock, chief executive officer of Franchise Capital Corporation. "There is still much work to be done to close this transaction, but we now have a solid framework, and both companies are committed to what we believe to be an effective strategy to introduce Aero Exhaust to the public markets. We anticipate discussing additional details of the transaction in the coming days and weeks as the acquisition moves forward."

In conjunction with executing the definitive agreement, Franchise Capital has agreed to provide a revolving commercial loan to Aero Exhaust in the amount of $1,500,000. The loan bears interest at the prime rate and is due and payable in 18 months. Notwithstanding the payment terms, the loan and any accrued interest are convertible into Aero Exhaust common stock at the time the share exchange closes.

"Reaching a definitive agreement with Franchise Capital represents a great opportunity for our shareholders," commented Bryan Hunsaker, CEO of Aero Exhaust, Inc. "We believe that our marketing partnerships will represent a significant value for Franchise Capital's shareholders, and the revolving line of credit, made available as part of this agreement, will assist us in managing our accelerated growth. We are anxious to move towards closing this transaction as quickly as possible and appreciate the dedication and enthusiasm of Franchise Capital's management and shareholders."

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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, www.aeroexhaust.com.

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.

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