Axial Vector Clarifies Recently Announced Standstill Agreement


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DUBAI, United Arab Emirates, March 17 -- Due to an enormous number of calls and questions regarding its announcement March 10, Axial Vector Engine Corporation (Pink Sheets: AXVC) (Frankfurt: BAE1) wishes to bring more clarity to this press release. On Monday, March 10, Axial Vector announced a "standstill" agreement with Emirates International Capital Advisory (EICA) (http://www.emiratescapital.net/) precluding the sale of AVEC treasury stock for less than US$4 per share. It also precludes EICA from buying directly from any large shareholders. The Agreement does not, however, prevent EICA from acquiring shares on the open market.

EICA Senior Managing Director Arash Masom stated, "As I said in the AVEC webcast on http://www.thegreenbaron.com/, EICA is a conservative investor and AVEC has matured to the point where we view it as a conservative, low risk investment for us, even at $4 per share. As the largest shareholder, we recognize our obligation to existing shareholders to minimize dilution, particularly when the stock is so deeply discounted. The March 10 announcement was addressing this point alone."

Mr. Masom continued, "Hence, we will inject capital in a variety of ways, as evidenced by our recent announcements regarding the acquisition of AVEC's primary supplier and military development company Adaptive Propulsion Systems, the extension of US$45 million of credit to AVEC for a full scale production line for generator sets in Detroit and/or Dubai and the dedication of even more capital for financing leases for end-users."

Director Masom concluded, "These obligations alone represent potentially hundreds of millions of dollars of commitment. We have the resources necessary to fully support AVEC's engine and small motor product lines as well and intend to commit additional resources as needed to expedite production and sales of all products."

Mr. Ahmed Khalifa, Chairman of AVEC stated, "We are delighted with the commitment of orders for emergency power and stand alone power that AVEC's products received at the Water, Energy Technology & Environment Exhibition (WETEX) here in Dubai."

Mr. Khalifa added, "We anticipate hosting a second webcast shortly and will summarize last week's order activities at some point this week and provide guidance going forward. The time and date of the webcast will be announced very shortly. In the meantime, pictures of AVEC's exhibit can be viewed under Press Room -- Gallery at http://www.axialvectorengine.com/."

Axial Vector(TM) Engine Corporation is a publicly traded company (OTC Pink Sheets: AXVC.PK) that owns, develops and licenses proprietary intellectual property regarding unique internal combustion engine technologies. AVEC is applying these technologies to develop an exciting, new, smaller and lighter internal combustion engine that produces significantly greater horsepower and three times more torque on less fuel than conventional engines of similar size.

Forward-Looking Statements

This press release may be deemed to contain forward-looking information. Any forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements, including statements as to industry trends, future economic performance, anticipated profitability, anticipated revenues and expenses, and products or service line growth, may be significantly and materially impacted by certain risks and uncertainties, including, but not limited to, failure to meet operating objectives or to execute the operating plan, completion, and other economic factors. Additional risks and uncertainties are described in the Company's public filings with the Securities and Exchange Commission.

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