Beacon Power Announces $10.6 Million Investment Commitment

Beacon Power Corp. announced that it has received commitments for $10.6 million of new investment in the company. The capital will be used to fund ongoing operations, including, among other things, the expected completion of Beacon’s Smart Energy 25 flywheel development and the design of the first 20MW frequency regulation power plant. The transaction is expected to close on February 15, 2007.

Investors agreed to purchase approximately 11.8 million units for $0.90 per unit, each of which consists of one share of the company’s common stock, par value $0.01 per share, and a warrant to purchase 0.5 shares of the company’s common stock at an exercise price of $1.33 per share. The net proceeds to the company are expected to be approximately $9.8 million after deducting placement agency fees and estimated offering expenses.

The warrants are immediately separable from the units, and will be exercisable beginning six months and one day after the date of their issuance, and will expire on the fifth anniversary of the date of their issuance. All of the units are being offered by Beacon Power under an effective shelf registration statement previously filed with the Securities and Exchange Commission.