Memorandum of Understanding

Proton Power Systems PLC
11 April 2008




Press Release                                                      11 April 2008



                            Proton Power Systems plc

                       ('Proton Power' or 'the Company')

          Proton and Karmann to build zero-emission commercial vehicle


Proton Power Systems plc (AIM: PPS), a leading designer, developer and producer
of fuel cells and fuel cell electric hybrid systems for 'back to base' markets,
is pleased to announce that its wholly owned subsidiary, Proton Motor Fuel Cell
GmbH ('Proton Motor'), has signed a memorandum of understanding ('MoU') with
Wilhelm Karmann GmbH ('Karmann'), a leading supplier of full-service vehicles
operating worldwide, to build a zero-emission, light-duty commercial vehicle.

Karmann and Proton Motor intend to collaborate in the 'Ecocarrier' project, a
vehicle designed by EcoCraft Automotive, in which Karmann will build the vehicle
and its electrical propulsion system, while Proton Motor will deliver the fuel
cell hybrid system. The project aims to deliver a zero-emission vehicle to
customers such as small businesses, local communities, airports, and postal and
delivery services, and to collect information on the operation of such vehicles.
  The Ecocarrier range will be based on a new frame and electrical drive concept
from EcoCraft Automotive, built by Karmann, and an electric fuel cell hybrid
system built by Proton Motor.

Proton Motor and Karmann intend to collaborate for the long term and to extend
this agreement after 2013 on terms based on the results of the cooperation
reached by that stage.

Felix Heidelberg, CEO of Proton Power Systems plc, said: 'We are delighted to
collaborate with Karmann.  We both see this project as a starting point for more
joint business in the area of fuel cell hybrid commercial vehicles.  Drawing
from experiences of both companies, Proton Power will be well-positioned to
develop and commercialise sustainable technical solutions for our target markets
and to generate new projects and contracts. We are looking forward to a
long-standing and fruitful cooperation'.



                                    - Ends -



For further information:

Proton Power Systems plc
Felix Heidelberg, CEO                                  Tel: [phone]
[e-mail]                          www.protonpowersystems.com

Noble & Company Limited
Andy Yeo / Nick Athanas                                Tel: [phone]
                                                                 www.noblegp.com

Media enquiries:
Abchurch Communications Limited
Justin Heath / Monique Tsang                           Tel: [phone]
[e-mail]                          www.abchurch-group.com



About Proton Power Systems plc

Proton Power Systems plc is a developer of fuel cells and fuel cell hybrid
systems for motive and back-up power supply. Proton Power has more than 13 years
of experience in the fuel cell market. Through its wholly owned subsidiary,
Proton Motor Fuel Cell GmbH, the Company has developed and produced a fuel cell
module running on hydrogen and integrated this with an energy storage system to
create a hybrid electric fuel cell system. The system harnesses the excess power
generated by the fuel cell during partial load (such as stop-start operations)
and uses the stored energy in peak demand times. The system thus boasts lower
fuel consumption and more consistent levels of power delivery than conventional
combustion engine or fuel cell-only systems, in addition to producing zero
harmful emissions.

Proton Power's market focus lies in industrial applications where 'back-to-base'
refuelling occurs at the end of each shift or work period, such as in the
materials handling and mass transportation sectors. In these markets, the
commercialization of applications is possible at a very early stage, as they do
not depend on the existence of a ubiquitous hydrogen infrastructure. Through
partnerships with leading OEMs such as Skoda, Proton Power's technology is
already deployed in city buses and forklift trucks.

Proton Power also targets the upcoming market for marine transportation
applications and provides the hybrid fuel cell propulsion system for Europe's
first fuel-cell-powered passenger ferry, which will be operating in Hamburg from
summer 2008.

Proton Power Systems plc was admitted to trading on AIM on 31 October 2006 and
is based in the UK. Its operating subsidiary, Proton Motor Fuel Cell GmbH, is
located in Puchheim, near Munich, Germany.

www.protonpowersystems.com



About Wilhelm Karmann GmbH and the 'Ecocarrier'

As a full-service vehicle supplier, Karmann supplies the international
automotive industry with ideas, new solutions, products and production plants.
For more than 100 years, their knowledge from modules to complete vehicles has
made them partners with the great names in the industry.

As a contract manufacturer, Wilhelm Karmann GmbH is building one of the world's
first fully electric small utility vehicle for EcoCraft Automotive, based at
Wunstorf (near Hanover). This range of vehicles, called EcoCarrier, can provide
transport and delivery independent of traffic bans related to smog or
particulate matter. For the current year, a production of 500 units is planned
to be built at Karmann's Osnabrueck facility. EcoCraft Automotive was in charge
of the serial development of the vehicle branded EcoCarrier. The concept
provides for a two-axle fully electric vehicle as well as a three-axle with a
hybrid powertrain system. Energy for the 'small' vehicle is currently derived
from a mobile storage system with globally available standard batteries. In the
future, fuel cells will power the vehicle. The 'larger' EcoCarrier features an
additional gasoline or diesel-operated engine powering the third axle, extending
its range substantially. The target group for the EcoCarrier includes small
businesses, catering and health care services, local communities, airports,
postal and delivery services. The vehicle is distributed by 16 retail partners,
and directly by EcoCraft Automotive in Wunstorf.

www.karmann.com




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