Fallkbrook Technologies, Inc. Closes $16 Million In Private Equity Financing

– Commercial availability of bicycles using NuVinci™ Continuously Variable Planetary technology expected in Q4 2006 –

(San Diego, Calif., August 14, 2006) – Fallbrook Technologies Inc. (Fallbrook), a pioneering technology development and intellectual property licensing company, announced today it has closed its latest round of equity financing, placing just over $16 million in Series C Preferred Shares with private investors.

The first close of the current financing round, involving the placement of $9.3 million in Series C Preferred Shares, took place in February 2006. Because of very strong investor demand, the company’s board subsequently extended and expanded the round, authorizing the offering of additional shares. Sixty-one new investors and 26 existing investors participated in this round, making a total of more than 150 investors that now have purchased a stake in Fallbrook.

The share price sets the company’s pre-money valuation at $120 million, approximately four times the valuation in Fallbrook’s previous financing round, completed in February 2005.

“Fallbrook’s core technology is the revolutionary NuVinci® continuously variable planetary (CVP) technology. NuVinci technology is a new class of highly adaptable and scalable continuously variable transmissions (CVTs). It promises to be the most practical and economical CVT for both human-powered and motor-powered vehicles and machines. The NuVinci CVP is applicable to virtually any product that uses a transmission, including bicycles, light electric vehicles, agricultural equipment, automobiles,and utility class wind turbines, among others.

Commercialization of the technology will soon reach a milestone with the Q4 2006 availability of bicycles incorporating the NuVinci CVP. Under an OEM licensing agreement, Ellsworth International, Inc. (Ellsworth), one of the bicycle industry’s most respected and innovative companies, is designing and building a new line of bicycles called The Ride™, using the NuVinci CVP instead of a traditional derailleur or internal gear hub. The Ride, described as a “performance lifestyle” bike, is designed for riders of all ages and skill levels. It will complement Ellsworth’s premier line of mountain and road bikes.

Ellsworth will purchase NuVinci CVPs from Aftermarket Technology Corp. (ATC) (NASDAQ: ATAC), Fallbrook’s licensed manufacturing partner. ATC will begin manufacturing NuVinci CVP hubs in Q3 2006.

A number of additional agreements with vehicle OEM partners are expected throughout the remainder of 2006.

Transmission fluid for the hubs is being manufactured and marketed under a development and trademark agreement with the Valvoline division of Ashland, Inc. (NYSE: ASH). Valvoline’s fluid will be commercially available during Q3 2006.

“Our investors have given Fallbrook and NuVinci technology a resounding vote of confidence,” said William Klehm III, president and CEO of Fallbrook. “With the impending commercial availability of NuVinci technology, we’re well on the way to achieving one of our core objectives – to change the way all transmission-based devices are designed and built.”

About Fallbrook Technologies Inc.
Fallbrook Technologies Inc. (Fallbrook) is a technology development and intellectual property licensing company dedicated to improving the performance and flexibility of transmissions for vehicles and equipment. Fallbrook's revolutionary NuVinci® continuously variable planetary (CVP) technology is applicable to virtually any machines that use a transmission such as bicycles, light electric vehicles, automobiles, agricultural equipment, and utility class wind turbines among others. The NuVinci technology offers companies the flexibility to design and produce next generation products that are better tailored to their unique business, market and competitive requirements.  To download a comprehensive press kit and company/technology backgrounder, click on a link below.

Fallbrook Press Kit