Disposal

    11 March 2008

                                   ParOS plc                                   

                          ("ParOS" or the "Company")                           

                        Disposal of trading subsidiary                         

Further to the announcement on 11 February 2008, the Company announces that it
has entered into a conditional sale and purchase agreement (the "Sale and
Purchase Agreement") to sell the entire issued share capital of its trading
subsidiary (the "Trading Subsidiary") to a company owned and controlled by
Professor Efstratios Pistikopoulos (the "Purchaser") for an initial
consideration of £1.00 plus certain other deferred amounts (the "Disposal").

Principal terms of the Disposal

The Company will receive an initial consideration of £1.00.

Furthermore, the Purchaser will pay additional consideration to the Company
calculated as to 7 per cent. of the gross revenue (including, without
limitation, grants and royalties) generated or received by it or its
subsidiaries in each of the financial years until the year ending 31 December
2022.

In addition, in the event of;

  * a sale of a controlling interest in the voting share capital of the
    Purchaser or that of the Trading Subsidiary or any subsidiary of the
    Trading Subsidiary; or
   
  * the Purchaser procures the sale of a material part of its business and
    assets or that of the Trading Subsidiary's business and assets (which
    includes any patents held at that time); or
   
  * the Purchaser or Trading Subsidiary's share capital is admitted to trading
    on a stock market,
   
at any time prior to 1 April 2018, the Purchaser will pay the Company
additional consideration equal to 40 per cent. of the gross proceeds arising
from any of these transactions.

The Company has given the Purchaser certain limited covenants in the Sale and
Purchase Agreement relating to the share capital, title to the Trading
Subsidiary and its capacity to enter into the agreement only. It has also given
a tax covenant in respect of tax liabilities of the Trading Subsidiary in
respect of tax liabilities arising in the period up until 15 February 2008.

The Sale and Purchase Agreement provides that the effective date of the sale
will be deemed to be 15 February 2008, with costs and expenses apportioned to
that date for the account of the Company and from that date for the account of
the Purchaser (save for certain specified costs which shall be borne by the
Company).

The Company will also enter in a deed of release of intra-group indebtedness
waiving the intra-group debt of approximately £925,000 owed by the Trading
Subsidiary to the Company, a compromise agreement terminating the employment of
Professor Pistikopoulos with the Company and written waivers to be signed by
each of Professor Pistikopoulos, Nikos Bozinis, Tara Lindstedt and Philip Keys
waiving all rights under the EMI Option Agreement dated 21 March 2006 and made
between the above listed persons and the Company (the "Option Waivers").

In the year ended 31 December 2007, the Trading Subsidiary incurred an
unaudited loss before taxation of £526,776 (2006 audited: loss £744,694) on
turnover of £88,878 (2006 audited: £75,730). At that date, the Trading
Subsidiary had unaudited assets of £267,602 (2006 audited: £359,582).

Under the AIM Rules, as the Disposal will result in the Company no longer
having a trading business, the Sale and Purchase Agreement is conditional,
inter alia, on the passing of the Resolutions at a general meeting of the
Company to be held on 28 March 2008 (the "GM"), notice of which is set out in a
circular which has been sent to shareholders today.

As a company owned and controlled by Professor Pistikopoulos is acquiring the
Trading Subsidiary, the transaction constitutes a related party transaction for
the purposes of Rule 13 of the AIM Rules. If approved by shareholders of the
Company at the GM, substantially all of the assets of the Company will be sold
to a related party of the Company. The Independent Directors, having consulted
with the Company's Nominated Adviser, John East & Partners Limited ("JEP"),
consider the terms of the Transaction to be fair and reasonable insofar as the
Company's shareholders are concerned. In advising the Independent Directors,
JEP has taken into account the commercial judgement of the Directors.

Reasons for the Disposal

In December 2007, the Company announced that it was to be granted a US patent
for its technology, in addition to the European patent that was granted earlier
in the same year.

In January 2008, the Company announced that it had been formally granted
patents in the UK, France, Germany, Switzerland, Greece and Italy.

Despite the Company winning a limited number of small development contracts and
some European research grants, it has been unable to secure a major contract
and, as a result, has not been able to reach a monthly break even cash
position.

The Trading Subsidiary requires significant working capital in order to
continue to trade. During the last six months the Company has been involved in
extensive discussions with potential investors with a view to them providing
sufficient working capital to enable the Trading Subsidiary to continue to
trade. However, despite the efforts of the Board, it has not been able to
conclude these discussions.

In light of these difficulties, the Directors have concluded that the Trading
Subsidiary cannot continue to trade and that the Disposal is in the best
interests of the Company and its Shareholders.

The Company had cash in hand of approximately £160,000 on 29 February 2008. The
Directors estimate that following completion of the Disposal, the Company will
have approximately £140,000 of cash.

Investing Strategy

Following the Disposal, the Directors believe that the remaining cash resources
of the Company could be attractive to a number of potential targets/
investments.

The Directors intend to seek to acquire another company or business in exchange
for the issue of Ordinary Shares in a single transaction (a "reverse
takeover"). The Directors' main investment criteria are: -

  * the engineering sector in the UK, Europe and North America;
   
  * businesses which require little or no funding in excess of the cash
    resources available to the Company following the Disposal; and
   
  * businesses whose growth prospects, if achieved, will be earnings enhancing
    for Shareholders.
   
However, these criteria are not intended to be exhaustive and the Company may
make an investment which does not fulfil all the investment criteria if they
believe it is in the interests of Shareholders as a whole to proceed with such
an investment. Any acquisition by the Company will be put to Shareholders for
their approval at the appropriate time.

Under the AIM Rules, the Company will have to make an acquisition or
acquisitions which constitute a reverse takeover or otherwise implement the
above investing strategy to the satisfaction of the London Stock Exchange
within twelve months of having received the consent of Shareholders at the
General Meeting, failing which trading in the Company's shares on AIM will be
suspended for up to six months. If a reverse takeover has not been made by that
time trading in the Company's shares will be cancelled.

Board changes

Upon the completion of the disposal, Professor Efstratios Pistikopoulos will
resign as a Director and as an employee of the Company and the Board will then
comprise of Patrick McHugh and Laura Avigdori.

Enquiries:

ParOS plc

Patrick McHugh Tel: [phone]

John East & Partners Limited (Nominated Adviser)

Simon Clements Tel: [phone]

Square1 Consulting Limited (Financial PR Adviser)

Mike Feltham Tel: [phone]



END