Settlement of Litigation

Environmental Recycling Technologies plc

Settlement of Litigation

Environmental Recycling Technologies plc ("ERT" or "the Company") (AIM: ENRT), which has developed and is exploiting the patented rights to the Powder Impression Moulding process ("PIM Process") capable of converting mixed waste plastics into commercially viable products, is pleased to announce the settlement by agreement of a series of disputes and litigation with Mr Sean Daley ("Mr Daley"), the former director of Camco Corporation Limited and CEO of the group's Central Asian operations

The settlement with Mr Daley is confidential, however the Board can confirm it will be payable in both cash and shares over a period of three years. Of the total settlement to be paid over the three years, approximately half the settlement will be paid in cash for which the Company has made provision in its 2009 interim report with the remainder to be satisfied in shares .

As part of the share settlement Mr Daley will immediately be issued 10,000,000 ordinary shares of 2.5 pence each in the Company to be issued at par value. Mr Daley has agreed to a share sale restraint agreement. The cash portion of the settlement will be satisfied from the Company's existing resources and future expected cash flow

The Board has taken the view that it was in shareholders and the Company's best interests to settle with Mr Daley and focus its efforts on the commercialisation of the PIM Process.

The settlement provides that the parties have withdrawn all complaints and all allegations about each other and have agreed not to comment any further

The Board intends to issue a year end trading update before the end of February 2010.

2nd February 2010

ENQUIRIES: