Licence Payment

18 March 2010

Torotrak Plc

("Torotrak" or "the Company")

Additional Licence Payment

In the Interim Management Statement issued on 16 February 2010, Torotrak (LSE: TRK) said that it would provide an update in March regarding licence and option payments in relation to the Licence and Exclusivity Agreement ("the Agreement") signed on 16 March 2009 with Allison Transmissions, Inc ("Allison").

Accordingly, we are pleased to confirm that £3.75m has been received from Allison in accordance with the terms of the Agreement. This brings the total licence payments now paid under the Agreement to £8.44m. These initial payments have provided Allison with non-exclusive licence rights over Torotrak's full-toroidal traction drive technology in the medium-sized commercial vehicle market, together with options to secure global manufacturing and sales exclusivity in this sector (except for Torotrak's existing licensees in this field).

Following this payment, we remain on course to achieve our target to break even on a profit after tax basis for the financial year to 31 March 2010.

Under the Agreement, Allison has further options to purchase, at a future date, a non-exclusive licence for Torotrak's technology in relation to applications in large commercial vehicles and further options to secure worldwide exclusivity (except for Torotrak's existing licensees in this field) across the commercial vehicle market. Total additional fees payable to Torotrak could amount to a further £6.75 million to £17.37 million, payable over the next three years, depending upon when, or if at all (in which case no additional fees are payable), these rights are taken up by Allison.