TAX.L Regulatory News (TAX)

22 June 2012

Eco City Vehicles PLC

("ECV" or "the Group")

Revised Financing Arrangement with the Pension Scheme

Eco City Vehicles PLC, a developer and supplier of eco-friendly commercial vehicles and the London licensed Mercedes Vito taxi, is pleased to announce the variation to the financing arrangements with the KPM-UK Taxi Plc Discretionary Pension Scheme (the "Pension Scheme").

Further to the announcement made on 2 May the Pension Scheme, whose beneficiaries are Peter DaCosta, Michael Troullis and Keith Marder (all directors and/or shareholders of the Group) has agreed a letter of variation addressed to ECV in relation to the £0.5 million tranche (the "Pension Loan") of the Pension Scheme's loans to the Group, which were announced on 2 May 2012. Pursuant to this letter the Pension Scheme has undertaken, inter alia, to ECV to maintain the Pension Loan until 14 June 2013 by lending back to the Group, subject to HMRC rules, within thirty days of receipt any repayment of principal amounts. If ECV raises further capital the parties will agree a revised payment schedule for the Loan. In accordance with AIM Rules 13 and 16, this variation is classified as a related party transaction for the purposes of the AIM Rules for Companies. Accordingly, the independent Directors (being all of the Directors other than Peter DaCosta, Michael Troullis and Keith Marder), having consulted with Numis Securities Limited (in its capacity as the Group's nominated adviser), confirm that they are satisfied that the terms of the agreements are fair and reasonable insofar as shareholders in the Group are concerned.

The cash position of the Group remains tight following the challenging conditions in 2011. The Group continues to maintain the full support of the Pension Scheme and its bank whilst continuing to consider other funding options.

Enquiries: