Exhibit 10.1

INVESTMENT AGREEMENT

BY AND BETWEEN

FEDERAL-MOGUL CORPORATION

AND

IEH FM HOLDINGS LLC

DATED AS OF DECEMBER 2, 2012

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TABLE OF CONTENTS

 

            Page   ARTICLE I DEFINITIONS AND INTERPRETATION      1   

Section 1.1.

     Definitions      1   

Section 1.2.

     Interpretation      6    ARTICLE II PURCHASE COMMITMENT      6   

Section 2.1.

     Purchase Commitment      6    ARTICLE III THE RIGHTS OFFERING AND BACKSTOP
COMMITMENT      7   

Section 3.1.

     The Rights Offering      7   

Section 3.2.

     Backstop Commitment      9    ARTICLE IV REPRESENTATIONS AND WARRANTIES OF
THE COMPANY      10   

Section 4.1.

     Organization      10   

Section 4.2.

     Authorization      10   

Section 4.3.

     Valid Issuance of Shares      10   

Section 4.4.

     Non-Contravention; Authorizations      10   

Section 4.5.

     Registration Statement; Prospectus      11   

Section 4.6.

     No Further Reliance      11    ARTICLE V REPRESENTATIONS AND WARRANTIES OF
INVESTOR      11   

Section 5.1.

     Organization      11   

Section 5.2.

     Non-Contravention; Governmental Authorization      12   

Section 5.3.

     Securities Act Compliance      12   

Section 5.4.

     Ownership      13   

Section 5.5.

     Financial Capability      13   

Section 5.6.

     No Further Reliance      13    ARTICLE VI CONDITIONS TO CLOSING      13   

Section 6.1.

     Conditions to the Obligations of the Company and the Investor      13   

Section 6.2.

     Common Stock Closing – Conditions to the Obligations of the Company      14
  

Section 6.3.

     Common Stock Closing – Conditions to the Obligations of the Investor     
15   

Section 6.4.

     Backstop Closing – Conditions to the Obligations of the Company      15   

Section 6.5.

     Backstop Closing – Conditions to the Obligations of the Investor      16   

ARTICLE VII COVENANTS

     17   

Section 7.1.

     Securities to be Issued      17   

Section 7.2.

     Share Listing      17   

Section 7.3.

     Minority Stockholder Protection      17   

 

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ARTICLE VIII TERMINATION

     18   

Section 8.1.

     Termination      18   

Section 8.2.

     Effects of Termination      18   

ARTICLE IX MISCELLANEOUS

     18   

Section 9.1.

     Survival      18   

Section 9.2.

     Indemnification      18   

Section 9.3.

     Legends      20   

Section 9.4.

     Notices      20   

Section 9.5.

     Further Assurances      21   

Section 9.6.

     Amendments and Waivers      21   

Section 9.7.

     Fees and Expenses      21   

Section 9.8.

     Successors and Assigns      21   

Section 9.9.

     Governing Law      21   

Section 9.10.

     Waiver of Jury Trial      22   

Section 9.11.

     Entire Agreement      22   

Section 9.12.

     Effect of Headings and Table of Contents      22   

Section 9.13.

     Severability      22   

Section 9.14.

     Counterparts; No Third Party Beneficiaries      22   

Section 9.15.

     Specific Performance      22   

Section 9.16.

     Guaranty of Performance      22   

 

Exhibits    Exhibit A    Form of Amendment and Joinder to Registration Rights
Agreement Exhibit B    Form of Tax Allocation Agreement

 

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INVESTMENT AGREEMENT

This INVESTMENT AGREEMENT, dated as of December 2, 2012 (this “Agreement”), is
by and between Federal-Mogul Corporation, a Delaware corporation (the
“Company”), and IEH FM Holdings LLC, a Delaware limited liability company (the
“Investor”).

BACKGROUND

WHEREAS, the Company desires that the Investor provide, and the Investor has
agreed to provide, a Purchase Commitment (as defined below) pursuant to which
the Investor will purchase shares of Common Stock (as defined below), on the
terms and subject to the conditions set forth herein; and

WHEREAS, the Company has proposed to offer and sell certain shares of Common
Stock pursuant to a Rights Offering (as defined below), on the terms and subject
to the conditions set forth herein; and

WHEREAS, the Company desires that the Investor provide, and the Investor has
agreed to provide, a Backstop Commitment (as defined below) to the Rights
Offering, on the terms and subject to the conditions set forth herein.

NOW, THEREFORE, in consideration of the mutual covenants and agreements
contained in this Agreement, the receipt and sufficiency of which are hereby
acknowledged, the parties to this Agreement hereby agree as follows:

ARTICLE I

DEFINITIONS AND INTERPRETATION

Section 1.1. Definitions. As used in this Agreement, the following terms have
the respective meanings set forth below:

“10b-5 Representation” shall have the meaning set forth in Section 4.5.

“Acquired Shares” means the Common Stock acquired pursuant to Section 2.1(a),
together with the Common Stock acquired pursuant to the Basic Subscription
Privilege and the Backstop Commitment and the Additional Shares acquired
pursuant to Section 3.1(d).

“Affiliate” of any Person means any other Person directly or indirectly
Controlling, Controlled by or under direct or indirect common Control with such
Person, provided that for purposes of this Agreement, the Company and its
Subsidiaries shall not be deemed to be Affiliates of the Investor.

“Aggregate Offered Shares” shall have the meaning set forth in Section 3.1(b).

“Agreement” shall have the meaning set forth in the Preamble.

 

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“Ancillary Agreements” means the Registration Rights Agreement and the Tax
Allocation Agreement.

“Backstop Shares” shall have the meaning set forth in Section 3.2(a).

“Backstop Closing” shall have the meaning set forth in Section 3.2(b).

“Backstop Closing Date” shall have the meaning set forth in Section 3.2(b).

“Backstop Commitment” shall have the meaning set forth in Section 3.2(a).

“Basic Subscription Privilege” shall have the meaning set forth in
Section 3.1(b).

“Beneficially Own,” “Beneficially Owned,” “Beneficial Ownership” and “Beneficial
Owner” with respect to any securities means a holder who is deemed to be the
beneficial owner, or ownership that is deemed to be beneficial ownership, of
such securities under Rule 13d-3 or Rule 13d-5 of the Exchange Act, and shall
include such securities Beneficially Owned by all other persons with whom a
holder would constitute a “group” within the meaning of Section 13(d) of the
Exchange Act with respect to such securities.

“Board” means the Board of Directors of the Company.

“Business Day” means any day other than a Saturday, Sunday or one on which banks
in New York, New York are authorized or required to close.

“Capital Stock” of any Person means any and all shares, interests,
participations or other equivalents however designated of corporate stock or
other equity participations, including partnership interests, whether general or
limited, of such Person and any rights (other than debt securities convertible
or exchangeable into an equity interest), warrants or options to acquire an
equity interest in such Person.

“Certified Ownership Percentage” shall have the meaning set forth in
Section 6.2(f).

“Common Stock” means the common stock, par value $0.01 per share, of the
Company.

“Common Stock Closing” shall have the meaning set forth in Section 2.1(b).

“Common Stock Closing Date” shall have the meaning set forth in Section 2.1(b).

“Company” shall have the meaning set forth in the Preamble.

“Company Indemnified Parties” shall have the meaning set forth in
Section 9.2(b).

“Control” has the meaning specified in Rule 12b-2 under the Exchange Act.

“DGCL” means the General Corporation Law of the State of Delaware.

“Effect” shall have the meaning set forth in the definition of “Material Adverse
Effect.”

 

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“Exchange Act” means the Securities Exchange Act of 1934, as amended.

“GAAP” means generally accepted accounting principles in the United States of
America as in effect from time to time.

“Governmental Entity” means any national, state, local, county, parish or
municipal government, domestic or foreign, any agency, board, bureau,
commission, court, tribunal, subdivision, department or other governmental or
regulatory authority or instrumentality that has jurisdiction over any of the
Company or any of its properties or assets or any matter relating to the
transactions contemplated by this Agreement.

“Group” has the meaning set forth in Section 13(d) of the Exchange Act as in
effect on the date of this Agreement.

“HSR Act” shall have the meaning set forth in Section 5.2(c).

“Indemnified Party” means an Investor Indemnified Party or a Company Indemnified
Party, as the case may be.

“Indemnifying Party” means the Company or the Investor, as the case may be.

“Investor” shall have the meaning set forth in the Preamble.

“Investor Indemnified Parties” shall have the meaning set forth in
Section 9.2(a).

“Law” means any federal, state, local or foreign law, statute or ordinance,
common law, or any rule, regulation, judgment, order, writ, injunction, decree,
arbitration award, license or permit of any Governmental Entity.

“Losses” shall have the meaning set forth in Section 9.2(a).

“Material Adverse Effect” means any fact, circumstance, event, change, effect or
occurrence (an “Effect”) that, individually or in the aggregate with all other
Effects, (x) would reasonably be expected to prevent, materially delay or
materially impair the ability of the Company to consummate the transactions
contemplated hereby in the timeframe contemplated hereby or (y) has had or
caused, or would have or cause, a material adverse effect on the assets,
properties, business, results of operations, or financial condition of the
Company and its Subsidiaries, taken as a whole, but, in the case of this clause
(y) shall not include (a) Effects generally affecting (i) the industry in which
the Company and its Subsidiaries operate or (ii) economic, political or
regulatory conditions or the financial, securities or credit markets in the U.S.
or elsewhere in the world, including natural disasters, any regulatory or
political developments, or any outbreak or escalation of hostilities or declared
or undeclared acts of war, terrorism or insurrection, whether occurring before
or after the date hereof, unless any such Effects disproportionately affect the
assets, properties, business, results of operations or financial condition of
the Company and its Subsidiaries, taken as a whole, relative to other industry
participants; (b) Effects to the extent resulting from the announcement of the
execution of this Agreement or the pendency of the transactions contemplated
hereby (including, without limitation, and solely by way of example of such
Effects, the Effects of the public announcement

 

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of this Agreement or the transactions contemplated hereby on the relationships
of the Company or any of its Subsidiaries with customers, suppliers,
distributors or employees); (c) Effects resulting from compliance by the Company
and its Subsidiaries with the terms of this Agreement, (d) declines in the price
or trading volume of shares of any Capital Stock of the Company; (e) Effects to
the extent resulting from any changes in Law or in GAAP (or the interpretation
thereof) after the date hereof, unless any such Effects disproportionately
affect the assets, properties, business, results of operations or financial
condition of the Company and its Subsidiaries, taken as a whole, relative to
other industry participants; (f) any failure by the Company to meet any
published analyst estimates or expectations regarding the Company’s revenue,
earnings or other financial performance or results of operations for any period,
or any failure by the Company to meet its internal budgets, plans or forecasts
regarding its revenues, earnings or other financial performance or results of
operations; or (g) any change or proposed change in the debt ratings of the
Company or any of its Subsidiaries or any debt securities of the Company or any
of its Subsidiaries; provided that the exception in clauses (d), (f), (g) shall
not prevent or otherwise affect a determination that any Effect underlying such
failure has resulted in, or contributed to, a Material Adverse Effect.

“Nasdaq” means the NASDAQ Global Select Market.

“Oversubscription Privilege” shall have the meaning set forth in Section 3.1(b).

“Person” means an individual, a corporation, a partnership, a limited liability
company, limited partnership, an association, a trust or any other entity or
organization, including a government or political subdivision or an agency or
instrumentality thereof.

“Previously Disclosed” means information set forth in or incorporated by
reference into the Company’s Annual Report on Form 10-K for the fiscal year
ended December 31, 2011 or its other reports and forms filed with the SEC under
Sections 13(a), 14(a) or 15(d) of the Exchange Act on or after January 1, 2012
(except for risks and forward looking information set forth in the “Risk
Factors” section of such annual report or in any forward looking statement
disclaimers or similar statements that are similarly non-specific and are
predictive or forward looking in nature).

“Prospectus” means the prospectus that forms a part of the Registration
Statement, including all documents incorporated therein by reference, as from
time to time amended or supplemented pursuant to the Securities Act or the
Exchange Act, including by the Prospectus Supplement.

“Prospectus Supplement” means the prospectus supplement relating to the Rights
and the Common Stock to be issued in the Rights Offering (including the Backstop
Shares) to be filed pursuant to Rule 424 under the Securities Act.

“Purchase Commitment” shall have the meaning set forth in Section 2.1(a).

“Purchase Commitment Price” means $7.85 per share of Common Stock.

“Record Date” means the date as of which each record holder of Common Stock will
be entitled to receive one (1) Right for each share of Common Stock held as of
such date, which date shall be a date after the Common Stock Closing Date
selected by the Board in accordance with the DGCL and the requirements of
Nasdaq.

 

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“Registration Rights Agreement” means the Registration Rights Agreement between
the Company and the Investor in substantially the form set forth in Exhibit A.

“Registration Statement” the registration statement on Form S-3 to be filed by
the Company pursuant to Section 3.1(a), including all documents incorporated
therein by reference, as from time to time amended or supplemented pursuant to
the Securities Act or the Exchange Act, including by any information contained
in any prospectus or prospectus supplement that is deemed to be a part of the
Registration Statement pursuant to Rule 430B under the Securities Act.

“Representatives” means, with respect to a Person, such Person’s directors,
officers, investment bankers, attorneys, accountants and other advisors or
representatives.

“Rights” shall have the meaning set forth in Section 3.1(b).

“Rights Offering” shall have the meaning set forth in Section 3.1(b).

“SEC” means the Securities and Exchange Commission.

“Securities Act” means the Securities Act of 1933, as amended.

“Special Committee” means a special committee of the Board comprised solely of
directors who are independent for purposes of Nasdaq rules.

“Subscription Notice” shall have the meaning set forth in Section 3.2(a).

“Subscription Period” shall have the meaning set forth in Section 3.1(b).

“Subscription Price” means the lower of (i) the Purchase Commitment Price and
(ii) the volume-weighted average price of the Common Stock as reported by
Nasdaq, obtained from Bloomberg L.P., for the trading hours from 9:30 a.m. to
4:00 p.m., Eastern Standard Time during the ten trading days immediately
preceding the date of the Record Date.

“Subsidiary” means, with respect to any specified Person, (a) any corporation,
association or other business entity of which more than 50% of the total voting
power of shares of Capital Stock entitled (without regard to the occurrence of
any contingency and after giving effect to any voting agreement or stockholders’
agreement that effectively transfers voting power) to vote in the election of
directors, managers or trustees of the corporation, association or other
business entity is at the time owned or controlled, directly or indirectly, by
that Person or one or more of the other Subsidiaries of that Person (or a
combination thereof); (b) any partnership a general partner or a managing
general partner of which is such Person or a Subsidiary of such Person; and
(c) any limited liability company a managing member or manager of which is such
Person or a Subsidiary of such Person.

“Tax Allocation Agreement” shall have the meaning set forth in Section 6.1(d).

 

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“Threshold Amount” shall mean 80.1% of the outstanding shares of Common Stock of
the Company after giving effect to the transactions contemplated by the Purchase
Commitment and the Rights Offering and the exercise of the Rights pursuant
thereto and the closing of the Rights Offering.

Section 1.2. Interpretation. When a reference is made in this Agreement to
“Preamble,” “Articles,” “Sections” or “Annexes,” such reference shall be to a
Preamble, Article or Section of, or Annex to, this Agreement, unless otherwise
indicated. The terms defined in the singular have a comparable meaning when used
in the plural, and vice versa, and words importing any gender include the other
gender. The table of contents and headings contained in this Agreement are for
reference purposes only and are not part of this Agreement. Whenever the words
“include,” “includes” or “including” are used in this Agreement, they shall be
deemed followed by the words “without limitation.” No rule of construction
against the draftsperson shall be applied in connection with the interpretation
or enforcement of this Agreement, as this Agreement is the product of
negotiation between sophisticated parties advised by counsel. All references to
“$” or “dollars” mean the lawful currency of the United States of America.
Except as expressly stated in this Agreement, all references to any statute,
rule or regulation are to the statute, rule or regulation as amended, modified,
supplemented or replaced from time to time (and, in the case of statutes,
include any rules and regulations promulgated under the statute) and all
references to any section of any statute, rule or regulation include any
successor to the section. References to “words of similar import” with respect
to Material Adverse Effect or materiality, does not include knowledge
qualifiers.

ARTICLE II

PURCHASE COMMITMENT

Section 2.1. Purchase Commitment.

(a) Subject to Section 2.1(b), the Investor shall purchase from the Company, and
the Company shall issue and sell to the Investor, 19,108,280 shares of Common
Stock, at the Purchase Commitment Price, in exchange for an aggregate purchase
price of $150,000,000.00 (the “Initial Purchase Amount”). The Investor’s
commitment to purchase the Common Shares as set forth in this Section 2.1(a) is
referred to herein as the “Purchase Commitment.”

(b) On the terms and subject to the conditions set forth in this Agreement, the
closing of the Purchase Commitment (the “Common Stock Closing”) shall occur at
10:00 a.m. (Central Standard Time) at the offices of Winston & Strawn LLP, 35
West Wacker Drive, Chicago, Illinois 60601, one Business Day following the date
that all of the conditions to the Common Stock Closing set forth in Article VI
of this Agreement have been satisfied or waived (other than those conditions
that by their nature are to be satisfied at the Common Stock Closing), or such
other place, time and date as shall be agreed between the Company and the
Investor (the date on which the Common Stock Closing occurs, the “Common Stock
Closing Date”).

(c) On the Common Stock Closing Date, (i) the Company shall deliver to the
Investor evidence of the issuance of the Common Shares in the name of the
Investor against

 

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payment by or on behalf of the Investor of the purchase price therefor, pursuant
to Section 2.1(a) by wire transfer of immediately available funds to the account
designated by the Company in writing, (ii) the Company shall deliver all other
documents and certificates required to be delivered to the Investor pursuant to
Section 6.3, and (iii) the Investor shall deliver all documents and certificates
required to be delivered to the Company pursuant to Section 6.2.

ARTICLE III

THE RIGHTS OFFERING AND BACKSTOP COMMITMENT

Section 3.1. The Rights Offering.

(a) As promptly as practicable after the Common Stock Closing Date, the Company
shall use its reasonable best efforts to prepare and file with the SEC the
Registration Statement which shall register under the Securities Act the
issuance of the Rights and the shares of Common Stock to be issued in the Rights
Offering (including the Backstop Shares). The Company shall not permit any
securities other than the Rights and the Common Stock to be issued in the Rights
Offering (including the Backstop Shares) to be included in the Registration
Statement. The Registration Statement (and any amendments thereto) and the
Prospectus shall be provided to the Investor and its counsel prior to its filing
with the SEC, and the Investor and its counsel shall be given a reasonable
opportunity to review and comment thereon.

(b) Following the date on which the Registration Statement is declared effective
by the SEC, the Company shall file with the SEC and print the Prospectus
Supplement, distribute copies of the Prospectus Supplement to the holders of
record of Common Stock as of the Record Date, and thereafter, promptly commence
a rights offering on the following terms: (i) the Company shall distribute, one
transferable right (“Rights”) to each holder of record of Common Stock for each
share of Common Stock held by such holder as of the Record Date; (ii) each Right
shall entitle the holder thereof to subscribe to purchase, at the election of
such holder, a number of shares of Common Stock at the Subscription Price (the
“Basic Subscription Privilege”), equal to such stockholder’s pro rata portion of
shares of Common Stock with an aggregate value of $150,000,000 million
calculated at the Subscription Price (the actual aggregate number of shares of
Common Stock, the “Aggregate Offered Shares”) where such pro rata portion is
calculated based upon the number of shares of Common Stock owned of record (as
reflected in the stock ledger maintained by the Company’s transfer agent) by a
stockholder on the Record Date relative to the number of shares of Common Stock
outstanding on the Record Date; (iii) the offering shall remain open for thirty
(30) days (or such longer period as may be required by Law) (the “Subscription
Period”); and (iv) each holder (other than the Investor and its Affiliates) who
fully exercises its Basic Subscription Privilege shall be entitled to subscribe
for additional shares of Common Stock at the Subscription Price pursuant to the
instructions set forth in the Prospectus Supplement and related materials to the
extent that other holders elect not to exercise all of their respective Rights
under the Basic Subscription Privilege (the “Oversubscription Privilege”);
provided that if insufficient shares of Common Stock are available to satisfy
all oversubscription requests, such requests shall be honored on a pro rata
basis in the manner set forth above (such rights offering, the “Rights
Offering”). No fractional shares of Common Stock shall be issued in connection
with the Rights Offering. The number of shares of Common Stock to be issued upon
exercise by a holder of Rights will be rounded down

 

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to the next lowest whole number of shares of Common Stock. Unless and until a
Special Committee exercises its right to cause the Investor to purchase
Additional Shares pursuant to Section 3.1(d), the Company shall use reasonable
best efforts to engage in and complete the transactions contemplated in Sections
3.1(a) and 3.1(b) as promptly as practicable.

(c) The Investor hereby agrees that it will exercise all of its Rights under its
Basic Subscription Privilege; provided, however, that if one or more
stockholders of the Company fully exercise their Basic Subscription Privilege,
and such stockholder(s) elect to subscribe for more shares of Common Stock than
are otherwise available for the Oversubscription Privilege pursuant to
Section 3.1(b)(iv), the Investor and its Affiliates hereby agree to not exercise
a number of Rights as may be necessary to satisfy the subscriptions submitted to
the Company by such stockholders pursuant to Section 3.1(b)(iv); provided, that
in no event shall the number of Rights of the Investor and its Affiliates that
the Investor agrees not to exercise pursuant to this Section 3.1(c) cause the
aggregate beneficial ownership of the Investor and its Affiliates of Common
Stock to be less than the Threshold Amount. The Investor shall not subscribe for
any shares of Common Stock under the Oversubscription Privilege.

(d) In the event the Rights Offering is not consummated within 180 calendar days
after the date hereof, then, for a period of 90 calendar days following the
expiration of such 180 calendar day period, upon the request of a Special
Committee, acting on behalf of the Company, the Investor hereby agrees to
purchase from the Company, as soon as practicable after the request of a Special
Committee (on a date selected by a Special Committee and in any case within 30
calendar days and with the amount being set forth in such request), additional
shares of Common Stock having an aggregate value of up to $150,000,000 million
at a price equal to the volume-weighted average price of the Common Stock as
reported by Nasdaq obtained from Bloomberg L.P., for the trading hours from 9:30
am to 4:00 p.m., Eastern Standard Time during the ten trading days immediately
preceding the date of such sale (the “Additional Shares”). The issuance and sale
of the Additional Shares shall be subject to the receipt of any approval of the
stockholders of the Company required under applicable Nasdaq rules. The Company
and the Investor agree to take all actions necessary to consummate the issuance
and sale of the Additional Shares (including, without limitation, the execution
by the Investor, in its capacity as a stockholder of the Company, of a written
consent approving the issuance and sale of the Additional Shares pursuant to
this Section 3.1(d)).

(e) The Company shall not amend any of the material terms of the Rights Offering
described in clauses (i) through (iv) of Section 3.1(b) or waive any material
conditions to the closing of the Rights Offering without the prior written
consent of the Investor and a Special Committee. Subject to the terms and
conditions of the Rights Offering, the Company shall effect the closing of the
Rights Offering as promptly as practicable following the end of the Subscription
Period.

(f) The Company shall pay all of its expenses associated with the Registration
Statement, the Prospectus, the Rights Offering and the other transactions
contemplated hereby, including filing and printing fees, the fees and expenses
of any subscription and information agents, the fees and expenses of its
counsel, accounting fees and expenses and costs associated with clearing the
Common Stock offered for sale under applicable state securities Laws.

 

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(g) The Investor shall provide to the Company such information as the Company
may reasonably require in connection with the preparation and filing of the
Registration Statement and the Prospectus. No such information provided by the
Investor shall contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the statements
therein not misleading (i) at the time the Registration Statement becomes
effective under the Securities Act and as of the “new effective date” with
respect to the Rights Offering pursuant to, and within the meaning of, Rule
430B(f)(2) under the Securities Act, and (ii) as of the date of the Prospectus
and the closing date of the Rights Offering and the Backstop Closing Date.

Section 3.2. Backstop Commitment.

(a) The Investor shall purchase from the Company, and the Company shall issue
and sell to the Investor, at a price per share equal to the Subscription Price,
a number of shares of Common Stock (the “Backstop Commitment”) equal to (i) the
Aggregate Offered Shares minus (ii) the number of shares of Common Stock
subscribed for and purchased by the holders of record of Common Stock as of the
Record Date under the Basic Subscription Privilege and the Oversubscription
Privilege. As soon as practicable (but not more than two Business Days) after
the expiration of the Rights Offering, the Company shall deliver to the Investor
a notice (the “Subscription Notice”) setting forth the number of shares of
Common Stock subscribed for in the Rights Offering and the number of shares of
Common Stock to be acquired by the Investor pursuant to the Backstop Commitment.
The shares of Common Stock acquired by the Investor pursuant to the Backstop
Commitment are collectively referred to as the “Backstop Shares.”

(b) On the terms and subject to the conditions set forth in this Agreement, the
closing of the Backstop Commitment (the “Backstop Closing”) shall occur on the
later of (i) three Business Days following the closing of the Rights Offering
and (ii) one Business Day following the date that all of the conditions to the
Backstop Closing set forth in Article VI of this Agreement have been satisfied
or waived (other than those conditions that by their nature are to be satisfied
at the Backstop Closing), at 10:00 a.m. (Central Standard Time) at the offices
of Winston & Strawn LLP, 35 West Wacker Drive, Chicago, Illinois 60601 or such
other place, time and date as shall be agreed between the Company and the
Investor (the date on which the Backstop Closing occurs, the “Backstop Closing
Date”).

(c) At the Backstop Closing (i) the Company shall deliver to the Investor
evidence of the issuance of the Backstop Shares in the name of the Investor
against payment by or on behalf of the Investor of the purchase price therefor
by wire transfer of immediately available funds to the account designated by the
Company in writing, (ii) the Company shall deliver all other documents and
certificates required to be delivered to the Investor pursuant to Section 6.5,
and (iii) the Investor shall deliver all documents and certificates required to
be delivered to the Company pursuant to Section 6.4.

 

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ARTICLE IV

REPRESENTATIONS AND WARRANTIES OF THE COMPANY

Except as Previously Disclosed, the Company represents and warrants to the
Investor that:

Section 4.1. Organization. The Company is duly incorporated and validly existing
as a corporation in good standing under the Laws of the State of Delaware and
has all corporate power and authority to own its property and assets and conduct
its business in all material respects as currently conducted. The Company is
duly qualified as a foreign corporation for the transaction of business and is
in good standing under the Laws of each other jurisdiction in which that nature
of the business conducts or the property owned by it makes such qualification
necessary, except, in each case, as would not, individually or in the aggregate,
have or reasonably be expected to have a Material Adverse Effect.

Section 4.2. Authorization. The Company has the requisite corporate power and
authority to execute and deliver this Agreement and each Ancillary Agreement to
which it is a party and to perform its obligations hereunder and thereunder. The
execution, delivery and performance by the Company of this Agreement and each
Ancillary Agreement to which it is a party and the consummation of the
transactions contemplated hereby and thereby have been (or will be when
delivered) duly authorized by all necessary corporate action on the part of the
Company, and no further approval or authorization is required on the part of the
Company, its board of directors or stockholders (except as expressly
contemplated by this Agreement). This Agreement and each Ancillary Agreement to
which the Company is a party constitute (or will constitute when delivered) the
valid and binding obligation of the Company, enforceable against the Company in
accordance with their terms, except as such may be limited by bankruptcy,
insolvency, fraudulent conveyance, reorganization or other similar Laws
affecting creditors’ rights generally and by general equitable principles, and
except as may be limited by applicable Law and public policy.

Section 4.3. Valid Issuance of Shares. The Acquired Shares will be, as of the
date or dates of their issuance, duly authorized by all necessary corporate
action on the part of the Company and, when issued and delivered by the Company
against payment therefor as provided in this Agreement, (a) will be validly
issued, fully paid and non-assessable and (b) will not be subject to any
statutory or contractual preemptive rights or other similar rights of
stockholders.

Section 4.4. Non-Contravention; Authorizations. The Company’s execution,
delivery and performance of this Agreement and the Ancillary Agreements,
issuance and delivery of the Acquired Shares, and consummation of the
transactions contemplated hereby and thereby will not: (i) result in any
violation of the provisions of the charter or bylaws of the Company,
(ii) conflict with or constitute a breach of or default (or, with the giving of
notice or lapse of time, would be in default) under, result in the creation or
imposition of any lien, charge or encumbrance upon any property or assets of the
Company pursuant to, or require the consent of any other party to, any
indenture, mortgage, loan or credit agreement, note, contract, franchise, lease
or other instrument to which the Company is a party or bound or to which any of
the property or assets of the Company is subject or (iii) result in any
violation of any Law applicable

 

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to the Company or any Subsidiary, except, in the case of clauses (ii) and (iii),
as would not, individually or in the aggregate, have a Material Adverse Effect.
Except for any application or other filing to be filed with Nasdaq and assuming
the accuracy of the Investor’s representations and warranties in Section 5.2(c),
no consent, approval, authorization or other order of, or registration or filing
with, any Governmental Entity or Nasdaq is required for the Company’s execution,
delivery and performance of this Agreement and the Ancillary Agreements, the
issuance and delivery of the Acquired Shares or the consummation of the
transactions contemplated hereby and thereby, except such as have been obtained
or made by the Company.

Section 4.5. Registration Statement; Prospectus. The Registration Statement and
the Prospectus, at the time the Registration Statement becomes effective and as
of the closing date of the Rights Offering and the Backstop Closing Date, will
comply as to form in all material respects with the applicable requirements of
the Securities Act and the Exchange Act and the rules and regulations of the SEC
thereunder. The Registration Statement, at the time it becomes effective under
the Securities Act and as of the “new effective date” with respect to the Rights
Offering pursuant to, and within the meaning of, Rule 430B(f)(2) under the
Securities Act, shall not contain an untrue statement of a material fact or omit
to state a material fact required to be stated therein or necessary to make the
statements therein not misleading; and the Prospectus, at the time the
Registration Statement becomes effective and as of its date and the closing date
of the Rights Offering and the Backstop Closing Date, shall not contain an
untrue statement of a material fact or omit to state a material fact necessary
in order to make the statements therein, in the light of the circumstances under
which they were made, not misleading; provided that, in each case, the Company
makes no such representation with respect to information provided to it by the
Investor pursuant to Section 3.1(g). The previous sentence is referred to as the
“10b-5 Representation.”

Section 4.6. No Further Reliance. The Company acknowledges that it is not
relying upon any representation or warranty made by the Investor not set forth
in this Agreement or in an Ancillary Agreement.

ARTICLE V

REPRESENTATIONS AND WARRANTIES OF INVESTOR

The Investor represents and warrants to the Company that:

Section 5.1. Organization. The Investor is duly organized and validly existing
as a limited liability company in good standing under the Laws of the State of
Delaware.

(a) Authorization. The Investor has the requisite power and authority to execute
and deliver this Agreement and each Ancillary Agreement to which it is a party
and to perform its obligations hereunder and thereunder. The execution, delivery
and performance by the Investor of this Agreement and each such Ancillary
Agreement and consummation of the transactions contemplated hereby and thereby
have been duly authorized by all necessary action on the part of the Investor,
and no further approval or authorization is required on the part of the
Investor, its managers or members. This Agreement and each Ancillary Agreement
to which the Investor is a party constitute (or will constitute when delivered)
the valid and binding obligation

 

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of the Company, enforceable against the Investor in accordance with their terms,
except as such may be limited by bankruptcy, insolvency, fraudulent conveyance,
reorganization or other similar Laws affecting creditors’ rights generally and
by general equitable principles, and except as may be limited by applicable Law
and public policy.

Section 5.2. Non-Contravention; Governmental Authorization.

(a) The execution, delivery and performance by the Investor of this Agreement
and the consummation of the transactions contemplated hereby will not:
(i) conflict with or violate any provision of its charter, bylaws or similar
governing documents, (ii) conflict with or result in any breach of, or
constitute a default (or, with the giving of notice or lapse of time, would be
in default) under, or give rise to any right to termination, acceleration or
cancellation under, any agreement, lease, mortgage, license, indenture or any
other contract to which the Investor is a party or by which its properties may
be bound or affected and (iii) conflict with or violate any Law applicable to
the Investor, except, in the case of clauses (ii) and (iii), as would not,
individually or in the aggregate, reasonably be expected to materially and
adversely affect the Investor’s ability to perform its obligations under this
Agreement or consummate the transactions contemplated hereby on a timely basis.

(b) Each approval, consent, order, authorization, designation, declaration or
filing by or with any regulatory, administrative or other Governmental Entity
necessary in connection with the execution and delivery by the Investor of this
Agreement and the consummation of the transactions contemplated herein (except
for such additional steps as may be required by Nasdaq or such additional steps
as may be necessary to qualify the Acquired Shares under federal securities,
state securities or blue sky Laws) has been obtained or made and is in full
force and effect, except as would not, individually or in the aggregate,
reasonably be expected to materially and adversely affect the Investor’s ability
to perform its obligations under this Agreement or consummate the transactions
contemplated hereby on a timely basis.

(c) In connection with the Investor’s prior acquisition of control of the
Company, Investor and all other Affiliates of Investor required to do so made a
timely filing pursuant to the Hart-Scott-Rodino Antitrust Improvements Act (“HSR
Act”) on February 2, 2007. The waiting periods under the act expired and,
accordingly, Investor obtained control of the Company. Pursuant to Code of
Federal Regulations 802.21, no further HSR Act filing will be required in
connection with Investor’s purchase of any additional shares of the Company
either in any private placement or public offering.

Section 5.3. Securities Act Compliance. The Acquired Shares being acquired by
the Investor hereunder are being acquired for its own account, for the purpose
of investment and not with a view to or for sale in connection with any public
resale or distribution thereof in violation of applicable securities Laws. The
Investor is an “accredited investor” within the meaning of Rule 501(a)
promulgated under the Securities Act and is knowledgeable, sophisticated and
experienced in business and financial matters, and it fully understands the
limitations on the ownership and sale, transfer or other disposition of the
Acquired Shares. The Investor is able to bear the financial risk of its
investment in the Acquired Shares and is able to afford the complete loss of
such investment. The Investor has been afforded access to information about the
Company and its financial condition and business, sufficient to enable the
Investor to evaluate its

 

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investment in the Acquired Shares. The Investor understands that the Acquired
Shares may be resold only if registered pursuant to the provisions of the
Securities Act or if an exemption from registration is available, except under
circumstances where neither such registration nor such an exemption is required
by Law.

Section 5.4. Ownership. As of the date of this Agreement, Investor and its
Affiliates are the Beneficial Owners of 76,697,804 shares of Common Stock.

Section 5.5. Financial Capability. As of the date hereof and at the Common Stock
Closing and the Backstop Closing and at the time of any purchase of Additional
Shares pursuant to Section 3.1(d) of this Agreement, the Investor will have
available funds necessary to consummate the Common Stock Closing and the
Backstop Closing, respectively, on the terms and conditions contemplated by this
Agreement.

Section 5.6. No Further Reliance. The Investor acknowledges that it is not
relying upon any representation or warranty made by the Company not set forth in
this Agreement or in an Ancillary Agreement. The Investor acknowledges that it
has conducted such review and analysis of the business, assets, condition,
operations and prospects of the Company that the Investor considers sufficient
for purposes of the purchase of the Acquired Shares.

ARTICLE VI

CONDITIONS TO CLOSING

Section 6.1. Conditions to the Obligations of the Company and the Investor. The
obligations of the Company and the Investor to effect the Common Stock Closing
and the Backstop Closing, as applicable, shall be subject to the following
conditions:

(a) no provision of any applicable Law and no judgment, injunction, order or
decree shall prohibit the consummation of any of the transactions contemplated
hereby; and

(b) the Common Shares and the Common Stock to be issued in the Rights Offering
(including the Backstop Shares) shall have been authorized for listing on
Nasdaq, subject to official notice of issue, prior to the Common Stock Closing
Date, with respect to the Common Shares, and the Backstop Closing Date, with
respect to the Common Stock to be issued in the Rights Offering (including the
Backstop Shares);

(c) the Term Loan and Revolving Credit Agreement, dated as of December 27, 2007
(as amended, restated, supplemented or otherwise modified through the date
hereof, the “Existing Credit Agreement”), among the Company, the lenders party
thereto, Citicorp USA, Inc., as Administrative Agent, JPMorgan Chase Bank, N.A.
(“JPMCB”), as Syndication Agent, and Wachovia Capital Finance Corporation and
Wells Fargo Foothill, LLC, as Co-Documentation Agents, shall have been amended
on substantially the terms described in the Commitment Letter, dated as of
December 2, 2012 (as amended, restated, supplemented or otherwise modified, the
“Commitment Letter”), among JPMCB, J.P. Morgan Securities LLC, Wells Fargo Bank,
National Association, Wells Fargo Capital Finance, LLC and the Company, with
such changes as may be approved by the Company;

 

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(d) Tranche B Lenders (as defined in the Existing Credit Agreement) holding at
least $1.2 billion of the outstanding principal amount of Tranche B Term Loans
(as defined in the Existing Credit Agreement) shall have agreed to extend the
maturity date of such Tranche B Loans to the Extended Tranche B Term Loan
Maturity Date (as defined in the Commitment Letter); and

(e) the Company and the Investor shall have entered into a tax allocation
agreement (the “Tax Allocation Agreement”) in the form attached hereto as
Exhibit B.

Section 6.2. Common Stock Closing – Conditions to the Obligations of the
Company. The obligations of the Company to effect the Common Stock Closing shall
be subject to the following conditions:

(a) the representations and warranties of the Investor contained in this
Agreement (i) that are qualified by materiality or words of similar import shall
be true and correct as of the date hereof and as of the Common Stock Closing
Date (except to the extent that any such representation and warranty expressly
speaks as of an earlier date, in which case such representation and warranty
shall be true and correct as of such earlier date) and (ii) that are not
qualified by materiality or words of similar import, shall be true and correct
in all material respects as of the Common Stock Closing Date (except to the
extent that any such representation and warranty expressly speaks as of an
earlier date, in which case such representation and warranty shall be true and
correct in all material respects as of such earlier date);

(b) the Investor shall have performed in all material respects all of its
obligations required to be performed by it hereunder at or prior to the Common
Stock Closing Date;

(c) the Company shall have received a certificate, signed by an officer of the
Investor, certifying as to the matters set forth in Section 6.2(a) and
Section 6.2(b);

(d) the Company shall have received a certificate of the Secretary of the
Investor, dated as of the Common Stock Closing Date, certifying: (i) a true,
complete and correct copy of the certificate of formation of the Investor, as
amended, (ii) a true, complete and correct copy of the operating agreement of
the Investor, as amended and (iii) resolutions of the managers of the Investor
authorizing and approving the execution, delivery and performance by the
Investor of this Agreement and any agreements, instruments, certificates or
other documents executed by the Investor pursuant hereto;

(e) certificate of good standing for the Investor from the Secretary of State of
the State of Delaware, dated not more than two Business Days immediately
preceding the Common Stock Closing Date;

(f) the Company shall have received a certificate, signed by an officer of the
Investor, certifying the number of shares of Common Stock of the Company
Beneficially Owned (such amount the “Certified Ownership Percentage”) as of the
close of business on the Business Day immediately prior to the Common Stock
Closing Date by the Investor and its Affiliates; and

 

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(g) the Investor shall have delivered funds by wire transfer of immediately
available funds in order to satisfy the payment obligations set forth in
Section 2.1(c).

Section 6.3. Common Stock Closing – Conditions to the Obligations of the
Investor. The obligations of the Investor to effect the Common Stock Closing
shall be subject to the following conditions:

(a) the representations and warranties of the Company contained in this
Agreement (i) that are qualified by materiality, Material Adverse Effect or
words of similar import shall be true and correct as of the date hereof and as
of the Common Stock Closing Date (except to the extent that any such
representation and warranty expressly speaks as of an earlier date, in which
case such representation and warranty shall be true and correct as of such
earlier date) and (ii) that are not qualified by materiality, Material Adverse
Effect or words of similar import, shall be true and correct in all material
respects as of the Common Stock Closing Date (except to the extent that any such
representation and warranty expressly speaks as of an earlier date, in which
case such representation and warranty shall be true and correct in all material
respects as of such earlier date), other than in the case of both (i) and (ii),
any failure to be true and correct which, in the aggregate would not reasonably
be expected to have a Material Adverse Effect;

(b) the Company shall have performed in all material respects all of its
obligations required to be performed by it hereunder at or prior to the Common
Stock Closing;

(c) the Investor shall have received a certificate, signed by an officer of the
Company, certifying as to the matters set forth in Section 6.3(a) and
Section 6.3(b);

(d) the Investor shall have received a certificate of the Secretary of the
Company, dated as of the Common Stock Closing Date, certifying: (i) a true,
complete and correct copy of the charter of the Investor, as amended, (ii) a
true, complete and correct copy of the bylaws of the Company, as amended and
(iii) resolutions of the board of directors of the Investor authorizing and
approving the execution, delivery and performance by the Investor of this
Agreement and any agreements, instruments, certificates or other documents
executed by the Company pursuant hereto;

(e) certificate of good standing for the Company from the Secretary of State of
the State of Delaware, dated not more than two Business Days immediately
preceding the Backstop Closing Date;

(f) the Investor shall have received the Registration Rights Agreement, duly
executed by the Company; and

(g) the Company shall have delivered evidence of the issuance of the Common
Shares in the name of the Investor in accordance with Section 2.1(c).

Section 6.4. Backstop Closing – Conditions to the Obligations of the Company.
The obligations of the Company to effect the Backstop Closing shall be subject
to the following conditions:

(a) the Rights Offering shall have been consummated in accordance in all
material respects with the terms set forth in Section 3.1(b) hereof and in
accordance with the Securities Act.

 

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(b) the representations and warranties of the Investor contained in this
Agreement (i) that are qualified by materiality or words of similar import shall
be true and correct as of the date hereof and as of the Backstop Closing Date
(except to the extent that any such representation and warranty expressly speaks
as of an earlier date, in which case such representation and warranty shall be
true and correct as of such earlier date) and (ii) that are not qualified by
materiality or words of similar import, shall be true and correct in all
material respects as of the Backstop Closing Date (except to the extent that any
such representation and warranty expressly speaks as of an earlier date, in
which case such representation and warranty shall be true and correct in all
material respects as of such earlier date);

(c) the Investor shall have performed in all material respects all of its
obligations required to be performed by it hereunder at or prior to the Backstop
Closing Date;

(d) the Company shall have received a certificate, signed by an officer of the
Investor, certifying as to the matters set forth in Section 6.4(b) and
Section 6.4(c);

(e) the Company shall have received a certificate of the Secretary of the
Investor, dated as of the Backstop Closing Date, certifying: (i) a true,
complete and correct copy of the certificate of formation of the Investor, as
amended, (ii) a true, complete and correct copy of the operating agreement of
the Investor, as amended and (iii) resolutions of the managers of the Investor
authorizing and approving the execution, delivery and performance by the
Investor of this Agreement and any agreements, instruments, certificates or
other documents executed by the Investor pursuant hereto;

(f) certificate of good standing for the Investor from the Secretary of State of
the State of Delaware, dated not more than two Business Days immediately
preceding the Backstop Closing Date;

(g) the Company shall have received a certificate, signed by an officer of the
Investor, certifying the Certified Ownership Percentage as of the close of
business on the Business Day immediately prior to the Backstop Closing Date by
the Investor and its Affiliates; and

(h) the Investor shall have delivered funds by wire transfer of immediately
available funds in order to satisfy the payment obligations set forth in
Section 3.1(c).

Section 6.5. Backstop Closing – Conditions to the Obligations of the Investor.
The obligations of the Investor to effect the Backstop Closing shall be subject
to the following conditions:

(a) the Rights Offering shall have been consummated in accordance in all
material respects with the terms set forth in Section 3.1(b) hereof and in
accordance with the Securities Act;

 

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(b) the representations and warranties of the Company contained in this
Agreement (i) that are qualified by materiality, Material Adverse Effect or
words of similar import shall be true and correct as of the date hereof and as
of the Backstop Closing Date (except to the extent that any such representation
and warranty expressly speaks as of an earlier date, in which case such
representation and warranty shall be true and correct as of such earlier date)
and (ii) that are not qualified by materiality, Material Adverse Effect or words
of similar import, shall be true and correct in all material respects as of the
Backstop Closing Date (except to the extent that any such representation and
warranty expressly speaks as of an earlier date, in which case such
representation and warranty shall be true and correct in all material respects
as of such earlier date), other than in the case of both (i) and (ii), any
failure to be true and correct which, in the aggregate would not reasonably be
expected to have a Material Adverse Effect;

(c) the Company shall have performed in all material respects all of its
obligations required to be performed by it hereunder at or prior to the Backstop
Closing;

(d) the Investor shall have received a certificate, signed by an officer of the
Company, certifying as to the matters set forth in Section 6.5(b) and
Section 6.5(c);

(e) the Investor shall have received a certificate of the Secretary of the
Company, dated as of the Backstop Closing Date, certifying: (i) a true, complete
and correct copy of the charter of the Company, as amended, (ii) a true,
complete and correct copy of the bylaws of the Company, as amended and
(iii) resolutions of the board of directors of the Company authorizing and
approving the execution, delivery and performance by the Company of this
Agreement and any agreements, instruments, certificates or other documents
executed by the Company pursuant hereto;

(f) certificate of good standing for the Company from the Secretary of State of
the State of Delaware, dated not more than two Business Days immediately
preceding the Backstop Closing Date; and

(g) the Company shall have delivered evidence of the issuance of the Backstop
Shares in the name of the Investor in accordance with Section 3.1(c).

ARTICLE VII

COVENANTS

Section 7.1. Securities to be Issued. The Acquired Shares to be issued to the
Investor pursuant to this Agreement shall be subject to the terms and provisions
of the Company’s certificate of incorporation.

Section 7.2. Share Listing. The Company shall use its reasonable best efforts to
cause the Common Stock to be issued in the Rights Offering (including the
Backstop Shares) to be issued and approved for listing on Nasdaq, subject to
official notice of issuance.

Section 7.3. Minority Stockholder Protection. Except as specifically
contemplated by this Agreement, the Investor (together with all Affiliates of
the Investor) shall not, without the prior approval of a Special Committee:
(i) for a period of three (3) years from the date of the

 

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Common Stock Closing, effectuate a short-form merger involving the Company
pursuant to Section 253 of the General Corporation Law of the State of Delaware;
or (ii) through the earlier of (x) 180 days from the Common Stock Closing or
(y) the closing of the Rights Offering, acquire, through transactions executed
on Nasdaq (other than privately negotiated block trades completed through
Nasdaq) or through any tender offer, any additional shares of Common Stock.

ARTICLE VIII

TERMINATION

Section 8.1. Termination. This Agreement may be terminated at any time prior to
the occurrence of either the Backstop Closing or the Common Stock Closing, as
applicable, by (x) mutual agreement of a Special Committee, acting on behalf of
the Company, and the Investor, and (y) either party, upon written notice to the
other, in the event that the Common Stock Closing does not occur on or before
December 24, 2012. This Agreement shall automatically terminate, without any
action by the parties hereto, thirteen months following the date of this
Agreement.

Section 8.2. Effects of Termination. In the event of the termination of this
Agreement as provided in Section 8.1, this Agreement shall forthwith become
wholly void and of no further force and effect, except as expressly provided in
Section 9.1; provided that nothing herein shall relieve any party from liability
for any intentional and willful breach of this Agreement occurring prior to such
termination. In determining losses or damages recoverable upon termination by a
party hereto for the other party’s breach, the parties hereto acknowledge and
agree that such losses and damages shall not be limited to reimbursement of
expenses or out-of-pocket costs, and shall include the benefit of the bargain
lost by such party.

ARTICLE IX

MISCELLANEOUS

Section 9.1. Survival. Each of the representations and warranties set forth in
Section 4 and Section 5 shall survive the Common Stock Closing and the Backstop
Closing, as applicable. In addition, Section 3.1(f), Section 9.2 and Section 9.7
shall survive the Common Stock Closing and the Backstop Closing or the
termination of this Agreement.

Section 9.2. Indemnification.

(a) Notwithstanding anything in this Agreement to the contrary, from and after
the date hereof, the Company agrees to indemnify and hold harmless the Investor,
its Affiliates and each of their respective officers, directors, partners,
employees, agents and Representatives (the “Investor Indemnified Parties”), to
the fullest extent lawful, from and against any and all actions, suits, claims,
proceedings, costs, losses, liabilities, damages, expenses (including reasonable
and documented fees of counsel), amounts paid in settlement and other costs
(collectively, “Losses”) arising out of or relating to (i) any inaccuracy in or
breach of the Company’s representations or warranties contained in this
Agreement or (ii) the Company’s breach of any agreement or covenant made by the
Company in this Agreement. Notwithstanding

 

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the above, there shall be no indemnity hereunder in respect of any Losses
resulting from any action, suit, claim, matter or proceeding initiated by or on
behalf of a stockholder of the Company (other than the Investor, with respect to
its rights under this Agreement against the Company) relating to the
transactions contemplated by this Agreement.

(b) Notwithstanding anything in this Agreement to the contrary, from and after
the date hereof the Investor, agrees to indemnify and hold harmless the Company,
its Affiliates and each of their respective officers, directors, partners,
employees, agents and Representatives (the “Company Indemnified Parties”), to
the fullest extent lawful, from and against any and all Losses arising out of or
relating to (i) any inaccuracy in or breach of the Investor’s representations or
warranties contained in this Agreement, or (ii) the Investor’s breach of any
agreement or covenant made by the Investor in this Agreement.

(c) An Indemnified Party shall give written notice to the Indemnifying Party of
any claim with respect to which it seeks indemnification promptly after the
discovery by such Indemnified Party of any matters giving rise to a claim for
indemnification pursuant to Section 9.2(a) or Section 9.2(b), and the
Indemnifying Party shall assume the defense thereof, including the employment of
counsel reasonably satisfactory to the Indemnified Party and the payment of all
fees and expenses incurred in connection with defense thereof; provided that the
failure of any Indemnified Party to give notice as provided herein shall not
relieve the Indemnifying Party of its obligations under this Section 9.2 unless
and to the extent that the Indemnifying Party shall have been actually
prejudiced by the failure of such Indemnified Party to so notify the
Indemnifying Party. Such notice shall describe in reasonable detail such claim.
An Indemnified Party shall have the right to employ separate counsel in any such
proceeding and to participate in the defense thereof, provided that the fees and
expenses of such counsel shall be at the expense of such Indemnified Party
unless: (i) the Indemnifying Party has agreed in writing to pay such fees and
expenses; (ii) the Indemnifying Party shall have failed promptly to assume the
defense of such proceeding and to employ counsel reasonably satisfactory to such
Indemnified Party in any such proceeding; or (iii) the named parties to any such
proceeding (including any impleaded parties) include both such Indemnified Party
and the Indemnifying Party, and such Indemnified Party shall have been advised
by counsel that a conflict of interest is likely to exist if the same counsel
were to represent such Indemnified Party and the Indemnifying Party (in which
case, if such Indemnified Party notifies the Indemnifying Party in writing that
it elects to employ separate counsel at the expense of the Indemnifying Party,
the Indemnifying Party shall not have the right to assume the defense thereof
and shall be liable for the reasonable and documented legal fees and expenses of
one law firm retained by the Indemnified Party). The Indemnifying Party shall
not be liable for any settlement of any action, suit, claim or proceeding
effected without its written consent. The Indemnifying Party will not, without
the Indemnified Party’s prior written consent, settle or compromise any claim or
consent to entry of any judgment in respect thereof in any pending or threatened
action, suit, claim or proceeding in respect of which indemnification has been
sought hereunder unless such settlement or compromise includes an unconditional
release of such Indemnified Party from all liability arising out of such action,
suit, claim or proceeding.

 

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Section 9.3. Legends. The Investor agrees with the Company that each Common
Share shall contain a legend substantially to the following effect until it may
be removed in accordance with applicable Law:

THE OFFER AND SALE OF THE SECURITY EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”)
OR ANY STATE SECURITIES LAWS. ACCORDINGLY, SUCH SECURITY MAY NOT BE OFFERED OR
SOLD UNLESS SUCH OFFER AND SALE IS IN COMPLIANCE WITH THE SECURITIES ACT OR SUCH
TRANSFER IS CONDUCTED PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
SECURITIES ACT.

Section 9.4. Notices. All notices and other communications required or permitted
to be given under this Agreement shall be in writing and shall be deemed to have
been duly given (a) on the date of delivery, if delivered personally or by
facsimile, upon confirmation of receipt, (b) on the first Business Day following
the date of dispatch if delivered by a recognized next-day courier services,
(c) upon receipt, if delivered by facsimile or other electronic transmission
(provided confirmation of transmission and deliver is electronically generated
and kept on file by the sending party) or (d) on the third Business Day
following the date of mailing if delivered by registered or certified mail,
return receipt requested, postage prepaid, to the parties to this Agreement at
the following address or to such other address either party to this Agreement
shall specify by notice to the other party:

If to the Company:

Federal-Mogul Corporation

2655 Northwestern Highway

Southfield, Michigan

Attention: General Counsel

Facsimile: (248) 354-7727

With a copy to (which shall not constitute notice):

Winston & Strawn LLP

35 West Wacker Drive

Chicago, Illinois 60601

Attention: Bruce A. Toth

  Brian M. Schafer

Facsimile: (312) 558-5700

If to the Investor:

IEH FM Holdings LLC

c/o Icahn Enterprises L.P.

767 Fifth Avenue, 46th Floor

New York, New York 10153

Attention: Daniel A. Ninivaggi

Facsimile: (212) 658-9371

 

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With a copy to (which shall not constitute notice):

Icahn Enterprises L.P.

767 Fifth Avenue, 47th Floor

New York, New York 10153

Attention: Keith L. Schaitkin

  Jesse A. Lynn

Facsimile: (212) 688-1158

Section 9.5. Further Assurances. Each party hereto shall do and perform or cause
to be done and performed all further acts and shall execute and deliver all
other agreements, certificates, instruments and documents as the other party
hereto reasonably may request in order to carry out the intent and accomplish
the purposes of this Agreement and the consummation of the transactions
contemplated hereby.

Section 9.6. Amendments and Waivers. Any provision of this Agreement may be
amended or waived if, but only if, such amendment or waiver is in writing and is
duly executed and delivered by a Special Committee, acting on behalf of the
Company, and the Investor. No failure or delay by any party in exercising any
right, power or privilege hereunder shall operate as a waiver thereof nor shall
any single or partial exercise thereof preclude any other or further exercise
thereof or the exercise of any other right, power or privilege. The rights and
remedies herein provided shall be cumulative and not exclusive of any rights or
remedies provided by Law.

Section 9.7. Fees and Expenses. Subject to Section 3.1(f), each party hereto
shall pay all of its own fees and expenses (including attorneys’ fees) incurred
in connection with this Agreement and the transactions contemplated hereby.

Section 9.8. Successors and Assigns. This Agreement shall not be assignable or
otherwise transferable (by operation of law or otherwise) by any party hereto
without the prior written consent of the other party hereto. The provisions of
this Agreement shall be binding upon and inure to the benefit of the parties
hereto and their respective successors and permitted assigns.

Section 9.9. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York. The parties hereby
irrevocably submit to the exclusive jurisdiction of the Court of Chancery of the
state of Delaware, or to the extent such court does not have subject matter
jurisdiction, the Superior Court of the State of Delaware or the United States
District Court of the State of Delaware, and hereby waive, and agree not to
assert, as a defense in any action, suit or proceeding for the interpretation or
enforcement hereof, that it is not subject thereto or that such action, suit or
proceeding may not be brought or is not maintainable in said courts or that the
venue thereof may not be appropriate or that this Agreement may not be enforced
in or by said courts, and the parties hereto irrevocably agree that all claims
with respect to such action or proceeding shall be heard and determined in the
Court of Chancery of the state of Delaware, or to the extent such court does not
have subject matter jurisdiction, the Superior Court of the State of Delaware or
the United States District Court of the State of Delaware. The parties hereby
consent to and grant any such court jurisdiction over the

 

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person of such parties and over the subject matter of any such dispute and agree
that mailing of process or other papers in connection with any such action or
proceeding in the manner provided in Section 9.4, or in such other manner as may
be permitted by applicable Law, shall be valid and sufficient service thereof.

Section 9.10. Waiver of Jury Trial. Each party acknowledges and agrees that any
controversy that may arise under this agreement is likely to involve complicated
and difficult issues, and therefore each such party hereby irrevocably and
unconditionally waives any right such party may have to a trial by jury in
respect of any litigation directly or indirectly arising out of or relating to
this agreement or the transactions contemplated by this agreement.

Section 9.11. Entire Agreement. This Agreement, together with the Ancillary
Agreements, constitutes the entire agreement between the parties with respect to
the subject matter of this Agreement and supersedes all prior agreements and
understandings, both oral and written, between the parties and/or their
Affiliates with respect to the subject matter of this Agreement.

Section 9.12. Effect of Headings and Table of Contents. The Article and Section
headings herein and the Table of Contents are for convenience only and shall not
affect the construction hereof.

Section 9.13. Severability. If one or more provisions of this Agreement are held
to be unenforceable under applicable Law, such provision shall be deemed to be
excluded from this Agreement and the balance of this Agreement shall be
interpreted as if such provision were so excluded and shall be enforced in
accordance with its terms to the maximum extent permitted by Law.

Section 9.14. Counterparts; No Third Party Beneficiaries. This Agreement may be
signed in any number of counterparts, each of which shall be an original, with
the same effect as if the signatures were upon the same instrument. No provision
of this Agreement shall confer upon any Person other than the parties hereto any
rights or remedies hereunder.

Section 9.15. Specific Performance. The parties hereto agree that irreparable
damage would occur in the event that any of the provisions of this Agreement
were not performed in accordance with their specific terms or were otherwise
breached. It is accordingly agreed that the parties shall be entitled to an
injunction or injunctions to prevent breaches of the provisions of this
Agreement and to enforce specifically the terms and provisions hereof in the
Court of Chancery of the State of Delaware or, to the extent such courts does
not have subject matter jurisdiction, the United States District Court for the
District of Delaware, and each party hereto agrees to waive in any action for
such enforcement the defense that a remedy at law would be adequate.

Section 9.16. Guaranty of Performance. Icahn Enterprises Holdings L.P. hereby
unconditionally and irrevocably guarantees the full and punctual payment by
Investor of each of its obligations under this Agreement.

(Signature page follows)

 

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IN WITNESS WHEREOF, the parties hereto have caused this Investment Agreement to
be duly executed by their respective authorized officers as of the date first
written above.

 

FEDERAL-MOGUL CORPORATION By:  

/s/ Alan J. Haughie

Name:   Alan J. Haughie Title:   Chief Financial Officer IEH FM HOLDINGS LLC By:
ICAHN ENTERPRISES HOLDINGS L.P., its sole member

By: ICAHN ENTERPRISES G.P., INC., its

general partner

By:  

/s/ Sung Hwan Cho

Name:   Sung Hwan Cho Title:   Chief Financial Officer

For Purposes of Section 9.16

 

ICAHN ENTERPRISES HOLDINGS L.P.

By: ICAHN ENTERPRISES G.P., INC.,

its general partner

By:  

/s/ Sung Hwan Cho

Name:   Sung Hwan Cho Title:   Chief Financial Officer

 

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EXHIBIT A

FORM OF AMENDMENT AND JOINDER TO REGISTRATION RIGHTS AGREEMENT

 

A-1

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EXHIBIT B

FORM OF TAX ALLOCATION AGREEMENT

 

B-1