SOURCE: Xtreme Motorsports of California, Inc.

February 20, 2007 08:30 ET

Xtreme Motorsports to Provide Stock and Cash Dividend to Shareholders

BAKERSFIELD, CA -- (MARKET WIRE) -- February 20, 2007 -- Xtreme Motorsports of California, Inc. (PINKSHEETS: XTMS) ("Xtreme" or the "Company"), today announced a stock and cash dividend to shareholders of record as of February 12, 2006. The Company is in the process of determining the exact amounts of the stock and cash dividend and will release additional information on or before February 28, 2007. Xtreme anticipates completing the distribution on or before June 1, 2007.

This cash and stock dividend is intended to protect shareholders and address the recent drop in share price during the week of February 5, 2007, which the Company believes is the result of reputable brokerages engaging in the illegal practice of naked short selling. The Company will consider taking further action if this activity continues.

While purchasers who have bought this "naked-shorted" stock may not be able to participate in the proposed dividend distribution, they may have a claim or cause of action against their brokers or the seller of the non-existent stock. For this reason, the Company is urging shareholders to contact their brokers to determine if they purchased naked-shorted stock.

"Our intent is to both protect and reward shareholders, as well as to cause any short sellers to cover their positions," commented Alan McCaa, President & CEO of Xtreme Motorsports. "On an annual basis, Xtreme will evaluate the distribution of a dividend to shareholders and hope to increase the amount in the future.

"Overall, our goal is to maintain and grow shareholder value, and we have been working diligently to professionalize and grow our operations as part of that commitment. The recent drop in stock price is of concern and we hope the dividend will assure shareholders we are acting as good stewards of their investment," McCaa continued.

About Xtreme Motorsports of California, Inc.

Xtreme Motorsports is a manufacturer of custom and production-line sandrails, desert and dual sport racecars. Founded in 1983, Xtreme's sandcars have been sold to customers in England, the United Arab Emirates, Australia, South America and the U.S. For more information, visit the corporate web site

Forward-Looking Statements

Certain statements in this release, and other written or oral statements made by the Company, including the use of the words "expect," "anticipate," "estimate," "project," "forecast," "outlook," "target," "objective," "plan," "goal," "pursue," "on track," and similar expressions, are "forward-looking statements" and are subject to known and unknown risks, uncertainties and other factors that may cause actual results, performance, or achievements of the company to be different from those expressed or implied. The Company assumes no obligation and does not intend to update these forward-looking statements and takes no obligation to update or correct information prepared by third parties that are not paid for by the Company.

Contact Information

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