Document:

EX-10.1

 

Exhibit 10.1

	 	 	 
	 
	 	BLAKE DAWSON WALDRON
	 
	 	LAWYERS
	 
	 	 

Amendment Deed

Novogen Research Pty Limited

ABN 87 060 202 931

Marshall Edwards Pty Limited

ABN 36 099 665 675

	 	 	 	 	 	 	 	 
	 

	 	 	 	 	
	 	 
	 

	 	 	 	 	
	 	 
	 

	 	Level 36
	 	 	 
	 	 
	 

	 	Grosvenor Place	 	 	 	 	 
	 

	 	225 George Street	 	 	 	 	 
	 

	 	Sydney NSW 2000	 	 	 	 	 
	 

	 	Telephone: +61 2 9258 6000	 	 	3rd April 2007 	 	 
	 

	 	Fax: + 61 2 9258 6999
	 	 	Ref: BLM FZD 02 1372 3369
	 	 

© Blake Dawson Waldron 2007

 

 

CONTENTS

	 	 	 	 	 	 	 	 	 
	1.	 	INTERPRETATION	 	 	1	 
	 
	 

	 	1.1	 	Definitions
	 	 	 	 	1
	 

	 	1.2	 	Terms defined in the Licence Agreement	 	 	 	 	1	 
	 

	 	1.3	 	Rules for interpreting this document	 	 	 	 	1	 
	 
	 	 	 	 	 	 	 	 	 	 
	2.	 	CONSIDERATION	 	 	2	 
	 
	 	 	 	 	 	 	 	 	 	 
	3.	 	AMENDMENT	 	 	2	 
	 
	 	 	 	 	 	 	 	 	 	 
	4.	 	REPRESENTATIONS AND WARRANTIES	 	 	2	 
	 
	 

	 	4.1	 	Representations and warranties	 	 	 	 	2	 
	 

	 	4.2	 	Reliance on representations and warranties	 	 	 	 	3	 
	 
	 	 	 	 	 	 	 	 	 	 
	5.	 	GENERAL	 	 	3	 
	 
	 

	 	5.1	 	Governing law	 	 	 	 	3	 
	 

	 	5.2	 	Liability for expenses	 	 	 	 	4	 
	 

	 	5.3	 	Giving effect to this document	 	 	 	 	4	 
	 

	 	5.4	 	Amendment	 	 	 	 	4	 
	 

	 	5.5	 	Counterparts	 	 	 	 	4	 

 

 

AMENDMENT DEED

DATE 3rd April 2007

PARTIES

Novogen Research Pty Limited ABN 87 060 202 931 of 140 Wicks Road, North Ryde NSW 2113
Australia (Novogen Research)

Marshall Edwards Pty Limited ABN 36 099 665 675 of 140 Wicks Road, North Ryde NSW 2113
Australia (MEPL)

RECITALS

	A.	 	The parties are parties to the Licence Agreement.
	 
	B.	 	The parties wish to amend the Licence Agreement on the terms of this document.

OPERATIVE PROVISIONS

	1.	 	INTERPRETATION
	 
	1.1	 	Definitions
	 
	 	 	The following definitions apply in this document.
	 
	 	 	Effective Date means the date this document is executed by the last of the parties to
execute it.
	 
	 	 	Licence Agreement means the agreement entitled “Amended and Restated Licence Agreement”
between Novogen Research and MEPL dated 24 September 2003, as further amended by an
Amendment Deed between the parties dated 6 June 2006.
	 
	1.2	 	Terms defined in the Licence Agreement
	 
	 	 	Terms that are not defined in clause 1.1 and that are defined in the Licence Agreement (as
amended by this document) have the same meaning in this document.
	 
	1.3	 	Rules for interpreting this document
	 
	 	 	Headings are for convenience only, and do not affect interpretation. The following rules
also apply in interpreting this document, except where the context makes it clear that a
rule is not intended to apply.

	 	(a)	 	A reference to:

	 	(i)	 	legislation (including subordinate legislation) is to that
legislation as amended, re-enacted or replaced, and includes any subordinate
legislation issued under it;

 

 

	 	(ii)	 	a document or agreement, or a provision of a document or
agreement, is to that document, agreement or provision as amended,
supplemented, replaced or novated;
	 
	 	(iii)	 	a party to this document or to any other document or agreement
includes a permitted substitute or a permitted assign of that party;
	 
	 	(iv)	 	a person includes any type of entity or body of persons,
whether or not it is incorporated or has a separate legal identity, and any
executor, administrator or successor in law of the person; and
	 
	 	(v)	 	anything (including a right, obligation or concept) includes
each part of it.

	 	(b)	 	A singular word includes the plural, and vice versa.
	 
	 	(c)	 	A word which suggests one gender includes the other genders.
	 
	 	(d)	 	If a word is defined, another part of speech has a corresponding meaning.
	 
	 	(e)	 	If an example is given of anything (including a right, obligation or concept),
such as by saying it includes something else, the example does not limit the scope of
that thing.
	 
	 	(f)	 	The word agreement includes an undertaking or other binding arrangement or
understanding, whether or not in writing.

	2.	 	CONSIDERATION
	 
	 	 	Each party acknowledges that it has received valuable consideration for entering into this
document.
	 
	3.	 	AMENDMENT

	 	(a)	 	The Licence Agreement is amended, with effect on the Effective Date, as
attached in Annexure A.
	 
	 	(b)	 	Subject to paragraph (c), paragraph (a) does not affect any right or obligation
that arises before the Effective Date.
	 
	 	(c)	 	The amendments in paragraph (a) are deemed to have taken effect on and from the
date the Licence Agreement was executed by the last of the parties to execute it.

	4.	 	REPRESENTATIONS AND WARRANTIES
	 
	4.1	 	Representations and warranties
	 
	 	 	Each party represents and warrants that:

	 	(a)	 	(status) it is a company limited by shares under the Corporations Act;
	 
	 	(b)	 	(power) it has full legal capacity and power:

2

 

	 	(i)	 	to own its property and assets and to carry on its business;
and
	 
	 	(ii)	 	to enter into this document and to carry out the transactions
that it contemplates;

	 	(c)	 	(corporate authority) it has taken all corporate action that is necessary or
desirable to authorise its entry into this document and its carrying out the
transactions that it contemplates;
	 
	 	(d)	 	(Authorisations) it holds each Authorisation that is necessary or desirable to:

	 	(i)	 	execute this document and to carry out the transactions that it
contemplates; and
	 
	 	(ii)	 	ensure that this document is legal, valid, binding and
admissible in evidence,

and it is complying with any conditions to which any of these Authorisations is
subject;

	 	(e)	 	(document effective) this document constitutes its legal, valid and binding
obligations, enforceable against it in accordance with its terms (except to the extent
limited by equitable principles and laws affecting creditors’ rights generally),
subject to any necessary stamping or registration;
	 
	 	(f)	 	(no contravention) neither its execution of this document, nor the carrying out
by it of the transactions that it contemplates, does or will:

	 	(i)	 	contravene any law to which it or any of its property is
subject or any order of any Government Agency that is binding on it or any of
its property;
	 
	 	(ii)	 	contravene any Authorisation;
	 
	 	(iii)	 	contravene any undertaking or instrument binding on it or any
of its property; or
	 
	 	(iv)	 	contravene its constitution; and

	 	(g)	 	(no trust) it is not entering into this document as trustee of any trust or
settlement.

	4.2	 	Reliance on representations and warranties
	 
	 	 	Each party acknowledges that the other party has executed this document and agreed to take
part in the transactions that it contemplates in reliance on the representations and
warranties that are made or repeated in this clause.
	 
	5.	 	GENERAL
	 
	5.1	 	Governing law
	 
	 	 	This document is governed by the law in force in New South Wales.

3

 

	5.2	 	Liability for expenses
	 
	 	 	Each party must pay its own expenses incurred in negotiating, executing, stamping and
registering this document.
	 
	5.3	 	Giving effect to this document
	 
	 	 	Each party must do anything (including execute any document), and must ensure that its
employees and agents do anything (including execute any document), that the other party may
reasonably require to give full effect to this document.
	 
	5.4	 	Amendment
	 
	 	 	This document can only be amended, supplemented, replaced or novated by another document
signed by the parties.
	 
	5.5	 	Counterparts
	 
	 	 	This document may be executed in counterparts.

EXECUTED as a deed.

	 	 	 
	 
	 	 
	EXECUTED by NOVOGEN 

RESEARCH PTY LIMITED:

	 	 
	 
	 	 
	/s/  Christopher
Naughton
	 	/s/  Ronald Lea
Erratt
	 

	 	 
	Signature of director

	 	Signature of director/secretary
	 
	 	 
	Christopher
Naughton
	 	Ronald Lea Erratt
	 

	 	 
	Name

	 	Name
	 
	 	 
	EXECUTED by MARSHALL 

EDWARDS PTY LIMITED:

	 	 
	 
	 	 
	/s/  Christopher
Naughton
	 	/s/  David Ross
Seaton
	 

	 	 
	Signature of director

	 	Signature of director/secretary
	 
	 	 
	Christopher
Naughton
	 	David Ross Seaton
	 

	 	 
	Name

	 	Name

4

 

	 	 	 
	 
	 	BLAKE DAWSON WALDRON
	 
	 	LAWYERS
	 
	 	 

ANNEXURE A

Further Amended and

Restated Licence

Agreement

Novogen Research Pty Limited

ABN 87 060 202 931

Marshall Edwards Pty Limited

ABN 36 099 665 675

	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	Level 41   
	 	 
	 	225 George Street   
	 	 
	 	Sydney NSW 2000   
	 	 
	 	Telephone: +61 2 9258 6000   

	 	   24 September 2003   
	 	Fax: +61 2 9258 6999   

	 	   Ref: SJD.BLM.02-1308-9508
	 
	© Blake Dawson Waldron 2002-2003

 

 

CONTENTS

	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	1.	 	INTERPRETATION	 	1
	 
	 	 	 	 	 	 
	 
	 	1.1	 	Definitions	 	1
	 
	 	1.2	 	Rules for interpreting this document	 	8
	 
	 	1.3	 	Business Days	 	9
	 
	 	 	 	 	 	 
	2.	 	LICENCE TO EXPLOIT THE PRODUCT	 	9
	 
	 	 	 	 	 	 
	 
	 	2.1	 	Grant of licence	 	9
	 
	 	2.2	 	Exclusivity	 	10
	 
	 	2.3	 	Expiration of Licensed Patent Rights	 	10
	 
	 	2.4	 	Sub-licences	 	10
	 
	 	2.5	 	Sub-contractors	 	10
	 
	 	 	 	 	 	 
	3.	 	CLINICAL TRIALS	 	10
	 
	 	 	 	 	 	 
	 
	 	3.1	 	Clinical Trials to date	 	10
	 
	 	3.2	 	Obligation to conduct Clinical Trials	 	11
	 
	 	3.3	 	Conduct of Clinical Trials	 	11
	 
	 	3.4	 	Clinical Trial Materials	 	11
	 
	 	3.5	 	Facilities and personnel	 	11
	 
	 	3.6	 	Records of Clinical Trials	 	11
	 
	 	3.7	 	Inspection of records	 	12
	 
	 	3.8	 	Reports on Clinical Trials	 	12
	 
	 	3.9	 	Publication of results of Clinical Trials	 	12
	 
	 	3.10	 	Intellectual Property Rights in Clinical Trial Materials	 	12
	 
	 	 	 	 	 	 
	4.	 	DEVELOPMENTS	 	12
	 
	 	 	 	 	 	 
	 
	 	4.1	 	MEPL Developments	 	12
	 
	 	4.2	 	Novogen Developments	 	12
	 
	 	 	 	 	 	 
	5.	 	MARKETING AND COMMERCIALISATION	 	13
	 
	 	 	 	 	 	 
	 
	 	5.1	 	Marketing and commercialisation	 	13
	 
	 	5.2	 	Commercialisation	 	13
	 
	 	5.3	 	Records and customer relations	 	13
	 
	 	5.4	 	Marketing and promotion	 	13
	 
	 	5.5	 	Approval of promotional and advertising material	 	14
	 
	 	5.6	 	Compliance with laws	 	14
	 
	 	5.7	 	Storage and handling	 	14
	 
	 	5.8	 	Compliance with laws	 	14
	 
	 	5.9	 	Packing and transport of Products	 	15
	 
	 	 	 	 	 	 
	6.	 	START GRANT AGREEMENT	 	15
	 
	 	 	 	 	 	 
	 
	 	6.1	 	Acknowledgment	 	15

 

 

	 	 	 	 	 	 	 
	 
	 	6.2	 	Compliance with the START Grant Agreement	 	15
	 
	 	6.3	 	Compliance with reasonable directions	 	15
	 
	 	 	 	 	 	 
	7.	 	LICENCE FEES	 	15
	 
	 	 	 	 	 	 
	 
	 	7.1	 	First lump sum licence fee	 	15
	 
	 	7.2	 	Second lump sum licence fee	 	16
	 
	 	7.3	 	Royalties during the Exclusivity Period	 	16
	 
	 	7.4	 	Royalties after the Exclusivity Period	 	16
	 
	 	7.5	 	Milestone Licence Fees	 	16
	 
	 	 	 	 	 	 
	8.	 	PAYMENT TERMS	 	17
	 
	 	 	 	 	 	 
	 
	 	8.1	 	Payments	 	17
	 
	 	8.2	 	Interest on overdue accounts	 	17
	 
	 	 	 	 	 	 
	9.	 	REPORTS AND ACCOUNTING	 	17
	 
	 	 	 	 	 	 
	 
	 	9.1	 	Books and records	 	17
	 
	 	9.2	 	Auditor’s certificates	 	17
	 
	 	9.3	 	Quarterly statements	 	17
	 
	 	9.4	 	Certification	 	18
	 
	 	9.5	 	Adjustments	 	18
	 
	 	9.6	 	Interest on adjustments	 	18
	 
	 	9.7	 	Inspection	 	18
	 
	 	 	 	 	 	 
	10.	 	OTHER COSTS	 	19
	 
	 	 	 	 	 	 
	 
	 	10.1	 	Maintenance of Licensed Patent Rights	 	19
	 
	 	10.2	 	Reimbursement by MEPL	 	19
	 
	 	10.3	 	Registration of Products	 	19
	 
	 	 	 	 	 	 
	11.	 	GOODS AND SERVICES TAX	 	19
	 
	 	 	 	 	 	 
	 
	 	11.1	 	GST Law definitions	 	19
	 
	 	11.2	 	GST payable in addition to other amounts	 	19
	 
	 	11.3	 	Tax invoice	 	20
	 
	 	11.4	 	Adjustments	 	20
	 
	 	11.5	 	GST where MEPL supplies Novogen Research	 	20
	 
	 	 	 	 	 	 
	12.	 	OTHER DEDUCTIONS AND WITHHOLDINGS	 	20
	 
	 	 	 	 	 	 
	13.	 	INTELLECTUAL PROPERTY RIGHTS	 	21
	 
	 	 	 	 	 	 
	 
	 	13.1	 	Acknowledgment	 	21
	 
	 	13.2	 	Maintenance of Licensed Intellectual Property	 	21
	 
	 	13.3	 	Notification	 	21
	 
	 	13.4	 	Proceedings by MEPL	 	21
	 
	 	13.5	 	Directions by Novogen Research	 	21
	 
	 	13.6	 	Joinder of Novogen Research	 	22

ii.

 

	 	 	 	 	 	 	 
	 
	 	13.7	 	Proceedings by Novogen Research	 	22
	 
	 	13.8	 	Joinder of MEPL	 	22
	 
	 	13.9	 	Damages and settlement amounts	 	22
	 
	 	13.10	 	Assignment of Intellectual Property Rights	 	22
	 
	 	 	 	 	 	 
	14.	 	CONFIDENTIAL INFORMATION	 	22
	 
	 	 	 	 	 	 
	 
	 	14.1	 	Confidentiality	 	22
	 
	 	14.2	 	Security	 	23
	 
	 	14.3	 	Exceptions to obligations of confidentiality	 	23
	 
	 	14.4	 	Public domain	 	23
	 
	 	 	 	 	 	 
	15.	 	REPRESENTATIONS AND WARRANTIES	 	23
	 
	 	 	 	 	 	 
	 
	 	15.1	 	Warranties of each party	 	23
	 
	 	15.2	 	Representations and warranties by Novogen Research	 	24
	 
	 	15.3	 	Validity of Licensed Patent Rights	 	25
	 
	 	15.4	 	Reliance on representations and warranties	 	25
	 
	 	 	 	 	 	 
	16.	 	LIMITATION OF LIABILITY	 	25
	 
	 	 	 	 	 	 
	 
	 	16.1	 	Limitation of liability of Novogen Research	 	25
	 
	 	16.2	 	Liability for infringement of Intellectual Property Rights	 	25
	 
	 	16.3	 	Exclusion of conditions and warranties	 	25
	 
	 	16.4	 	Indirect and consequential loss	 	25
	 
	 	 	 	 	 	 
	17.	 	INDEMNITIES AND INSURANCE	 	26
	 
	 	 	 	 	 	 
	 
	 	17.1	 	Clinical Trial indemnity	 	26
	 
	 	17.2	 	Commercialisation indemnity	 	26
	 
	 	17.3	 	MEPL’s insurance policies	 	27
	 
	 	17.4	 	Name of Novogen Research	 	27
	 
	 	17.5	 	Certificates of currency	 	27
	 
	 	17.6	 	Default	 	27
	 
	 	17.7	 	Expiry	 	27
	 
	 	17.8	 	Novogen Research’s insurance	 	27
	 
	 	 	 	 	 	 
	18.	 	FORCE MAJEURE	 	27
	 
	 	 	 	 	 	 
	 
	 	18.1	 	Notice and suspension of obligations	 	27
	 
	 	18.2	 	Effort to overcome	 	28
	 
	 	18.3	 	Termination	 	28
	 
	 	 	 	 	 	 
	19.	 	TERM AND TERMINATION	 	28
	 
	 	 	 	 	 	 
	 
	 	19.1	 	Term	 	28
	 
	 	19.2	 	Termination by Novogen Research	 	28
	 
	 	19.3	 	Termination by MEPL	 	29
	 
	 	19.4	 	Consequences to MEPL of termination	 	29
	 
	 	19.5	 	Consequences to Novogen Research of termination	 	29

iii.

 

	 	 	 	 	 	 	 
	 
	 	19.6	 	Survival and accrued rights	 	30
	 
	 	 	 	 	 	 
	20.	 	DISPUTE RESOLUTION	 	30
	 
	 	 	 	 	 	 
	 
	 	20.1	 	Disputes	 	30
	 
	 	20.2	 	Notice of Dispute	 	30
	 
	 	20.3	 	Negotiation	 	30
	 
	 	20.4	 	Resolution of Dispute	 	30
	 
	 	20.5	 	Mediation	 	30
	 
	 	 	 	 	 	 
	21.	 	NOTICES	 	31
	 
	 	 	 	 	 	 
	22.	 	AMENDMENT AND ASSIGNMENT	 	31
	 
	 	 	 	 	 	 
	 
	 	22.1	 	Amendment	 	31
	 
	 	22.2	 	Assignment	 	31
	 
	 	 	 	 	 	 
	23.	 	GENERAL	 	31
	 
	 	 	 	 	 	 
	 
	 	23.1	 	Governing law	 	31
	 
	 	23.2	 	Liability for expenses	 	32
	 
	 	23.3	 	Relationship of the parties	 	32
	 
	 	23.4	 	Giving effect to this document	 	32
	 
	 	23.5	 	Waiver of rights	 	32
	 
	 	23.6	 	Operation of this document	 	32
	 
	 	23.7	 	Operation of indemnities	 	32
	 
	 	23.8	 	Consents	 	33
	 
	 	23.9	 	Exclusion of contrary legislation	 	33
	 
	 	23.10	 	Counterparts	 	33
	 
	 	 	 	 	 	 
	SCHEDULE 1: Product Patent Rights	 	34
	 
	 	 	 	 	 	 
	SCHEDULE 2: Manufacturing Patent Rights	 	37

iv.

 

FURTHER AMENDED AND RESTATED

LICENCE AGREEMENT

DATE 24 September 2003

PARTIES

Novogen Research Pty Limited ABN 87 060 202 931 (“Novogen Research”)

Marshall Edwards Pty Limited ABN 36 099 665 675 (“MEPL”)

RECITALS

	A.	 	Novogen Research is the proprietor of certain patents, the applicant for certain patent
applications and the owner of certain know how relating to:

	 	(a)	 	a method of preparation of the compound known as “phenoxodiol”; and
	 
	 	(b)	 	agents comprising phenoxodiol and compositions containing it and its use as a
human therapeutic treatment.

	B.	 	MEPL wishes to conduct clinical trials relating to the use of phenoxodiol and to exploit
phenoxodiol throughout the world for certain human therapeutic uses.

	C.	 	In May 2002 Novogen Research agreed to grant to MEPL a licence to conduct clinical trials and
to exploit phenoxodiol on terms and conditions set out in a licence agreement between the
parties (the “Original Licence Agreement”).

	D.	 	The parties have agreed to amend and restate the terms of the Original Licence Agreement as
set out in this document with effect from the date of this document.

OPERATIVE PROVISIONS

	1.	 	INTERPRETATION

	1.1	 	Definitions

The following definitions apply in this document.

“Affiliate” means:

	 	(a)	 	in relation to a body corporate, each of:

	 	(i)	 	that body’s related bodies corporate;
	 
	 	(ii)	 	that body’s directors; and
	 
	 	(iii)	 	the persons who have a substantial holding (as that term is
defined in the Corporations Act) in that body; and

	 	(b)	 	in relation to a natural person, any:

	 	(i)	 	spouse;

 

	 	(ii)	 	relative by blood or adoption of that person or that person’s
spouse; and

	 	(iii)	 	body corporate in which that person and Affiliates of that
person hold in aggregate more than 20% of the voting shares.

“Authorisation” means:

	 	(a)	 	an authorisation, consent, declaration, exemption, notarisation or waiver,
however it is described; and
	 
	 	(b)	 	in relation to anything that could be prohibited or restricted by law if a
Government Agency acts in any way within a specified period, the expiry of that period
without that action being taken,

including any renewal or amendment.

“Bank Bill” means a bill of exchange (as defined in the Bills of Exchange Act 1909 (Cth))
that has been accepted by a bank authorised under a law of the Commonwealth or any state to
carry on banking business.

“Bank Bill Rate” means, for a period:

	 	(a)	 	the average, expressed as a yield per cent per annum (rounded up (if necessary)
to 4 decimal places) of all rates quoted on each day in the period as the 180 day
bank-accepted bill rate on the web site of the Reserve Bank of Australia at
www.rba.gov.au (or any web site that replaces that web site); or
	 
	 	(b)	 	if no rate can be calculated under paragraph (a), the bid rate available to
MEPL at about 11.00 am (Sydney time) on that day, as conclusively determined in good
faith by MEPL, for Bank Bills that have the tenor described in paragraph (a).

“Business Day” means a day that is not a Saturday, Sunday or public holiday in Sydney,
Australia.

“Change of Control” of MEPL means a change in:

	 	(a)	 	Control of the composition of the board of directors of the corporation;
	 
	 	(b)	 	Control of more than half the voting rights attaching to shares in the
corporation; or
	 
	 	(c)	 	Control of more than half the issued shares of the corporation (not counting
any share which carries no right to participate beyond a specified amount in the
distribution of either profit or capital),

which, for the avoidance of doubt, does not include a change in:

	 	(d)	 	Control of the composition of the board of directors of Novogen Limited;
	 
	 	(e)	 	Control of more than half the voting rights attaching to shares in Novogen
Limited; or

2.

 

	 	(f)	 	Control of more than half the issued shares of Novogen Limited (not counting
any share which carries no right to participate beyond a specified amount in the
distribution of either profit or capital).

“Clinical Trial” means a clinical evaluation of the stability, tolerability, synergy or
efficacy of a Product for use in the Field.

“Clinical Trial Materials” means all medication, Trial Protocols, results of Clinical
Trials, case report forms, study aids, and any other materials used in, or arising out of,
the conduct of Clinical Trials.

“Clinical Trial Subject” means a person who is enrolled in a Clinical Trial, whether or not
that person meets all eligibility criteria for enrolment into the Clinical Trial set out in
any Trial Protocol or otherwise.

“Commencement Date” means the date the Original Licence Agreement was executed by the last
of the parties to execute it.

“Commercialisation Income” means all gross income received by or on behalf of MEPL or its
related bodies corporate (other than Novogen Research and Novogen Laboratories) as a result
of or in connection with any assignment, sublicensing, or other dealing with MEPL’s rights
under this document, other than income received solely in consideration of the sale, hiring
or other disposal of Product.

“Commonwealth” means the Commonwealth of Australia.

“Confidential Information” means:

	 	(a)	 	in relation to Novogen Research, the Clinical Trial Materials, the Licensed
Know How, all Novogen Developments and MEPL Developments, all documents, records and
reports relating to the Licensed Intellectual Property or Products, which are provided
by MEPL under this document and all other written or oral information disclosed by
Novogen Research to MEPL under this document, other than information which MEPL can
establish:

	 	(i)	 	was in the public domain when it was given to MEPL;
	 
	 	(ii)	 	becomes, after being given to MEPL, part of the public domain,
except through disclosure contrary to this document; or
	 
	 	(iii)	 	was lawfully received by MEPL from another person having the
unrestricted legal right to disclose that information without requiring the
maintenance of confidentiality; and

	 	(b)	 	in relation to MEPL, all written or oral information disclosed by MEPL to
Novogen Research under this document, other than information referred to in paragraph
(a) and information which Novogen Research can establish:

	 	(i)	 	was in the public domain when it was given to it;

3.

 

	 	(ii)	 	becomes, after being given to it, part of the public domain,
except through disclosure contrary to this document; or
	 
	 	(iii)	 	was lawfully received by it from another person having the
unrestricted legal right to disclose that information without requiring the
maintenance of confidentiality.

“Control” means a power or control that is direct or indirect or that is, or can be,
exercised as a result of, by means of or by the revocation or breach of a trust, an
agreement, a practice, or any combination of them, whether or not they are enforceable. It
does not matter whether the power or control is express or implied, formal or informal,
exercisable alone or jointly with someone else.

“Corporations Act” means the Corporations Act 2001 (Cth).

“Deed of Acknowledgment and Undertaking” means the document so entitled to be entered into
between Novogen Limited and the Industry Research and Development Board for and on behalf of
the Commonwealth.

“Default Rate” means, in relation to an amount which has not been paid to a party, a rate
equal to the sum of that party’s cost of funding the amount (if that party were to borrow
that amount and as determined conclusively by that party) and 2% per annum.

“Disclosing Party” in relation to any information means the party who disclosed to another
party that information.

“Dispute” has the meaning given to that term in clause 20.1.

“Dispute Notice” has the meaning given to that term in clause 20.2.

“Encumbrance” means a mortgage, charge, pledge, lien, hypothecation or title retention
arrangement, a right of set-off or right to withhold payment of a deposit or other money, a
notice under section 255 of the Income Tax Assessment Act 1936 (Cth), section 260-5 in
schedule 1 to the Taxation Administration Act 1953 (Cth) or any similar legislation, or an
easement, restrictive covenant, caveat or similar restriction over property, or an agreement
to create any of them or to allow any of them to exist.

“Exclusivity Period” means the period commencing on the Commencement Date and ending the
later of:

	 	(a)	 	the date of expiration or lapsing of the last Patent Right in the patents and
patent applications set out in schedule 1 and 2; or
	 
	 	(b)	 	the date of expiration or lapsing of the last Licensed Patent Right which MEPL
would, but for the licence granted in clause 2.1, infringe in any country in the
Territory by doing in that country any of the things set out in clause 2.1.

“FDA Approval” means the approval by the Food and Drug Administration of the United States
of an investigational new drug (IND) application for a Product to commence phase 1 Clinical
Trials in the United States.

4.

 

“Field” means the prevention, treatment or cure of cancer in humans by pharmaceuticals
delivered or administered by injection or by any other means but excluding topical
applications. For the avoidance of doubt, “non-topical applications” shall be any means of
administration other than to the skin.

“Fixed and Floating Charge” means the document entitled “Deed of Fixed and Floating Charge”
between Novogen Research and St George Bank Limited dated 30 June 1997.

“Force Majeure Event” means any occurrence or omission as a direct or indirect result of
which the party relying on it is prevented from or delayed in performing any of its
obligations (other than a payment obligation) under this document and that is beyond the
reasonable control of that party, including forces of nature, industrial action and action
or inaction by a Government Agency.

“Government Agency” means:

	 	(a)	 	a government or government department or other body;
	 
	 	(b)	 	a governmental, semi-governmental or judicial person; or
	 
	 	(c)	 	a person (whether autonomous or not) who is charged with the administration of
a law.

“GST” means:

	 	(a)	 	the same as in the GST Law; and
	 
	 	(b)	 	any other goods and services tax, or any tax applying to this transaction in a
similar way; and
	 
	 	(c)	 	any additional tax, penalty tax, fine, interest or other charge under a law for
such a tax.

“GST Law” means the same as “GST law” means in A New Tax System (Goods and Services Tax) Act
1999 (Cth).

“Insolvency Event” means, for a person, being in liquidation or provisional liquidation or
under administration, having a controller (as defined in the Corporations Act) or analogous
person appointed to it or any of its property, being taken under section 459F(1) of the
Corporations Act to have failed to comply with a statutory demand, being unable to pay its
debts or otherwise insolvent, dying, ceasing to be of full legal capacity or otherwise
becoming incapable of managing its own affairs for any reason, taking any step that could
result in the person becoming an insolvent under administration (as defined in section 9 of
the Corporations Act), entering into a compromise or arrangement with, or assignment for the
benefit of, any of its members or creditors, or any analogous event, otherwise than in the
course of a reorganisation, reconstruction, amalgamation or merger.

“Intellectual Property Rights” means any and all existing and future intellectual and
industrial property rights throughout the world, whether conferred by statute, common law or
equity, including rights in relation to copyright, trade marks, designs, circuit layouts,
plant varieties, business and domain names, trade secrets and Know How (including the

5.

 

right to apply for registration of any such rights), Patent Rights and other results of
intellectual activity in the industrial, commercial, scientific, literary or artistic
fields.

“Know How” means technical and other information which is not in the public domain including
inventions, discoveries, concepts, data, formulae, ideas, specifications, procedures for
experiments and tests, results of experimentation and testing, results of research and
development and information in laboratory records, data collected during the course of
Clinical Trials, case reports, data analyses and summaries and submissions to and
information from ethical committees and regulatory authorities.

“Licensed Intellectual Property” means the Licensed Patent Rights and the Intellectual
Property Rights in the Licensed Know How.

“Licensed Know How” means the Manufacturing Know How, all existing Know How of Novogen
Research in relation to Products and its uses in the Field and all Know How in Clinical
Trial Materials, Novogen Developments and MEPL Developments.

“Licensed Patent Rights” means the Product Patent Rights, the Manufacturing Patent Rights
and all Patent Rights in any Novogen Developments and MEPL Developments.

“Manufacturing Know How” means all existing Know How of Novogen Research in relation to the
synthesis and manufacture of Products.

“Manufacturing Licence and Supply Agreement” means the agreement of that title between MEPL
and Novogen Laboratories dated on or about the date of this document.

“Manufacturing Patent Rights” means all Patent Rights in the patents and patent applications
set out in schedule 2.

“MEPL Developments” means all developments, improvements, enhancements, adaptations and new
Know How, whether patentable or otherwise, in relation to the Product or the Licensed
Intellectual Property, which during the Term are made or acquired by MEPL, its employees,
agents or contractors.

“Milestone Licence Fee” means:

	 	(a)	 	for the calender year ending 31 December 2003: US$1,000,000;
	 
	 	(b)	 	for the calender year ending 31 December 2004: US$2,000,000;
	 
	 	(c)	 	for the calender year ending 31 December 2005: US$4,000,000; and
	 
	 	(d)	 	upon the receipt by MEPL of the first:

	 	(i)	 	approval by the FDA of a New Drug Application (NDA) for a
Product (on an accelerated basis or otherwise);
	 
	 	(ii)	 	approval or authorisation of any kind to market a Product in
the United States; or
	 
	 	(iii)	 	approval or authorisation of any kind by a Government Agency
in any other country to market a Product,

6.

 

	 	 	 	(the Approval Date): US$8,000,000, together with interest on that amount from (and
including) 31 December 2006 to (but excluding) the Approval Date, at the Bank Bill
Rate;

	 	(e)	 	for the calendar year of the year of the Approval Date, and for each calendar
year during the Exclusivity Period thereafter: US$8,000,000,

less any amount payable to Novogen Research during that calendar year under clause 7.1.

“Net Sales” in relation to any Product means the gross invoice or contract price of that
Product sold, hired or otherwise disposed of by MEPL, its Affiliates (other than Novogen
Laboratories) or sub-licensees (which for avoidance of doubt includes sub-licensees via one
or more interposing sub-licences, but does not include mere distributors) to the first
person who is not its Affiliate or sub-licensee, after deducting (to the extent not already
deducted):

	 	(a)	 	trade and quantity discounts; and
	 
	 	(b)	 	returns, rebates and allowances actually taken.

“Novogen Developments” means all developments of, improvements to, enhancements to, or
adaptations of Products or Licensed Know How, whether patentable or otherwise, in the Field
which during the Term are made or acquired by Novogen Research, Novogen Limited or Novogen
Laboratories Pty Limited (ABN 42 002 489 947) or their employees, contractors or agents,
which Novogen Research is free to license or disclose to MEPL, but does not include any
Option Compound or any new isoflavonoid compound having a formula which does not fall within
the claims of the Product Patent Rights.

“Novogen Limited” means Novogen Limited ABN 37 063 259 754.

“Option Compound” has the meaning given in the document entitled “Amended and Restated
Licence Option Deed” between Novogen Research and MEPL dated 24 September 2003.

“Patent Rights” means existing and future patents (including any divisions, continuations,
continuations in part, renewals, reissues, extensions, supplementary protection
certificates, utility models and foreign equivalents thereof) and rights with respect to
existing and future patent applications and patentable inventions, including the right to
apply for registration of any such rights.

“Product” means any product or formulation containing the compound known as “phenoxodiol”
(or NV-06) for delivery or administration by injection or by any other means but excluding
topical applications, whether in primary manufactured form, final packaged form or
otherwise, and whether in combination with any other compound or component, active or
otherwise. For the avoidance of doubt, “non-topical applications” shall be any means of
administration of the Product other than to the skin.

“Product Patent Rights” means all Patent Rights in the patents and patent applications set
out in schedule 1.

7.

 

“Quarter” means, in respect of any calender year in the Term, the four quarters of that
year, the first of which commences on the first day of that year.

“START Grant Agreement” means the agreement entitled “R & D Start Grant Agreement No:
STG/00220” between Novogen Limited and the Industry Research and Development Board for and
on behalf of the Commonwealth, dated 24 December 1998.

“Tax” means a tax, levy, duty, charge, deduction or withholding, however it is described,
that is imposed by a Government Agency, together with any related interest, penalty, fine or
other charge.

“Term” means the term of this document as determined under clause 19.

“Territory” means the world.

“Trial Protocol” means a protocol for the conduct of a Clinical Trial as may be developed by
MEPL from time to time.

	1.2	 	Rules for interpreting this document

Headings are for convenience only, and do not affect interpretation. The following rules
also apply in interpreting this document, except where the context makes it clear that a
rule is not intended to apply.

	 	(a)	 	A reference to:

	 	(i)	 	legislation (including subordinate legislation) is to that
legislation as amended, re-enacted or replaced, and includes any subordinate
legislation issued under it;
	 
	 	(ii)	 	a document or agreement, or a provision of a document or
agreement, is to that document, agreement or provision as amended,
supplemented, replaced or novated;
	 
	 	(iii)	 	a party to this document or to any other document or agreement
includes a permitted substitute or a permitted assign of that party;
	 
	 	(iv)	 	a person includes any type of entity or body of persons,
whether or not it is incorporated or has a separate legal identity, and any
executor, administrator or successor in law of the person; and
	 
	 	(v)	 	anything (including a right, obligation or concept) includes
each part of it.

	 	(b)	 	A singular word includes the plural, and vice versa.
	 
	 	(c)	 	A word which suggests one gender includes the other genders.
	 
	 	(d)	 	If a word is defined, another part of speech has a corresponding meaning.
	 
	 	(e)	 	If an example is given of anything (including a right, obligation or concept),
such as by saying it includes something else, the example does not limit the scope of
that thing.

8.

 

	 	(f)	 	The word “agreement” includes an undertaking or other binding arrangement or
understanding, whether or not in writing.
	 
	 	(g)	 	The words “subsidiary”, “holding company” and “related body corporate” have the
same meanings as in the Corporations Act.
	 
	 	(h)	 	A reference to “US$” is to the currency of the United States of America.

	1.3	 	Business Days

If the day on or by which a person must do something under this document is not a Business
Day:

	 	(a)	 	if the act involves a payment that is due on demand, the person must do it on
or by the next Business Day; and
	 
	 	(b)	 	in any other case, the person must do it on or by the previous Business Day.

	1.4	 	Application of this document

	 	(a)	 	This document varies and amends the Original Licence Agreement with effect from
the date of execution of this document.
	 
	 	(b)	 	The terms and conditions of this document replace the terms and conditions of
the Original Licence Agreement.

	2.	 	LICENCE TO EXPLOIT THE PRODUCT

	2.1	 	Grant of licence

Novogen Research by this document grants to MEPL for the Term a non-transferable licence
under the Licensed Patent Rights and the Intellectual Property Rights in the Licensed Know
How to:

	 	(a)	 	make, have made, sell, hire or otherwise dispose of Products in the Territory
for use in the Field;
	 
	 	(b)	 	offer to make, sell, hire or otherwise dispose of Products in the Territory for
use in the Field;
	 
	 	(c)	 	use and import Products into any country in the Territory for the purpose of
exercising its rights under paragraphs (a) and (b);
	 
	 	(d)	 	use, reproduce, apply, develop, modify and enhance the Licensed Know How in the
Field;
	 
	 	(e)	 	keep Products and the Licensed Know How for the purpose of doing any of the
things in paragraphs (a) to (d); and
	 
	 	(f)	 	use any method or process claimed or disclosed in the Manufacturing Patent
Rights or forming part of the Manufacturing Know How for the purpose of exercising its
rights under paragraphs (a) to (e).

9.

 

	2.2	 	Exclusivity

The licence granted in clause 2.1 is:

	 	(a)	 	exclusive in the Field and in the Territory during the Exclusivity Period; and
	 
	 	(b)	 	non-exclusive in the Field and in the Territory from the date of expiration of
the Exclusivity Period until the end of the Term.

	2.3	 	Expiration of Licensed Patent Rights

If during the Term all Licensed Patent Rights in any country in the Territory lapse or are
held invalid, then subject to clause 19.1, the licence granted in clause 2.1 shall continue
in full force and effect in that country on the same terms as a licence under the
Intellectual Property Rights in the Licensed Know How only.

	2.4	 	Sub-licences

	 	(a)	 	Subject to paragraphs (b) and (c), MEPL may not grant sub-licences under any of
the rights granted to it under this document without the prior written consent of
Novogen Research.
	 
	 	(b)	 	MEPL may grant a sub-licence to Novogen Laboratories on the terms and
conditions of the Manufacturing Licence and Supply Agreement.
	 
	 	(c)	 	Novogen Research must grant its consent to any sub-licence proposed to be
granted by MEPL in the circumstances set out in clause 3.9 of the Manufacturing Licence
and Supply Agreement provided that sub-licence is in terms substantially consistent
with those in the Manufacturing Licence and Supply Agreement.

	2.5	 	Sub-contractors

MEPL may not engage agents or sub-contractors to perform its obligations under this
document:

	 	(a)	 	without the prior written consent of Novogen Research; and
	 
	 	(b)	 	unless such agents or sub-contractors first agree in writing:

	 	(i)	 	to comply with confidentiality obligations substantially
identical to those of MEPL under this document; and
	 
	 	(ii)	 	to assign to Novogen Research all Intellectual Property Rights
in the Field created or acquired by them in the course of their engagement.

	3.	 	CLINICAL TRIALS
	 
	3.1	 	Clinical Trials to date

Novogen Research represents and warrants to MEPL that:

	 	(a)	 	Novogen Limited has sponsored and funded phase 1 Clinical Trials in Australia;

10.

 

	 	(b)	 	Novogen Limited has obtained the FDA Approval; and
	 
	 	(c)	 	the FDA Approval has not been revoked or amended.

	3.2	 	Obligation to conduct Clinical Trials

MEPL shall continue current Clinical Trials and undertake further Clinical Trials on the
terms and conditions of this document.

	3.3	 	Conduct of Clinical Trials

MEPL must and must ensure that its agents, contractors and sub-licensees:

	 	(a)	 	fund or arrange adequate third party funding of Clinical Trials;
	 
	 	(b)	 	use all reasonable endeavours to design and conduct Clinical Trials to generate
outcomes which are calculated to result in regulatory approval of a Product for use in
the Field;
	 
	 	(c)	 	conduct Clinical Trials diligently, in good scientific manner, in compliance
with any applicable laws, rules and regulations of any Government Agency in the
Territory (including any laws governing the protection and privacy of personal
information), in accordance with any Trial Protocol and any other reasonable directions
given by Novogen Research from time to time, and consistently with the requirements of
any applicable good laboratory practices;
	 
	 	(d)	 	ensure that all Clinical Trial Materials are handled appropriately and stored
securely by MEPL, its employees, contractors and agents for the duration of the
Clinical Trials;
	 
	 	(e)	 	ensure that MEPL’s employees, contractors, sub-licensees and agents who are
involved in carrying out Clinical Trials fully understand and adhere to any Trial
Protocol; and
	 
	 	(f)	 	take all reasonable measures, in consultation with Novogen Research, to protect
Clinical Trial Subjects at risk following a serious adverse drug experience.

	3.4	 	Clinical Trial Materials
	 
	 	 	MEPL shall be solely responsible for providing all Clinical Trial Materials necessary for
the conduct of Clinical Trials.

	3.5	 	Facilities and personnel
	 
	 	 	In order to comply with its obligations under this clause 3, MEPL must, and must ensure that
its employees, agents, contractors and sub-licensees use appropriate skill, experience,
equipment and facilities.

	3.6	 	Records of Clinical Trials

MEPL must maintain complete and accurate records in good scientific manner, which fully
record:

11.

 

	 	(a)	 	all work done and results achieved in the course of Clinical Trials;
	 
	 	(b)	 	details of MEPL’s employees, agents, contractors and sub-licensees engaged to
conduct Clinical Trials, all Clinical Trial Subjects and all other persons involved in
Clinical Trials; and
	 
	 	(c)	 	the Clinical Trial Materials.

	3.7	 	Inspection of records

Novogen Research or its nominee may, during normal business hours and upon reasonable notice
to MEPL, inspect and copy the records maintained by MEPL under clause 3.6, and may take and
retain such copies as Novogen Research thinks fit.

	3.8	 	Reports on Clinical Trials

	 	(a)	 	Within 5 Business Days of a written request by Novogen Research from time to
time during the Term, MEPL shall submit a written report to Novogen Research on the
status of all Clinical Trials.
	 
	 	(b)	 	MEPL shall immediately report to Novogen Research any serious adverse drug
experience which occurs during the course of Clinical Trials, and if requested by
Novogen Research, MEPL shall cooperate in reporting that experience to any relevant
third party or Government Agency.

	3.9	 	Publication of results of Clinical Trials

MEPL must not, and must ensure that its employees, agents, contractors and sub-licensees do
not, publish, present in public or make available to any third party the results of any
Clinical Trials without the prior written consent of Novogen Research.

	3.10	 	Intellectual Property Rights in Clinical Trial Materials

By this document, MEPL assigns to Novogen Research absolutely and as beneficial owner, the
entire right, title and interest in all Intellectual Property Rights in all Clinical Trial
Materials.

	4.	 	DEVELOPMENTS
	 
	4.1	 	MEPL Developments

MEPL shall disclose to Novogen Research all MEPL Developments as soon as is reasonably
practicable after becoming aware of them, and by this document MEPL assigns to Novogen
Research absolutely and as beneficial owner the entire right, title and interest in all
Intellectual Property Rights in all MEPL Developments.

	4.2	 	Novogen Developments

Novogen Research shall disclose to MEPL all Novogen Developments as soon as is reasonably
practicable after becoming aware of them.

12.

 

	5.	 	MARKETING AND COMMERCIALISATION

	5.1	 	Marketing and commercialisation

Subject to clauses 5.2 to 5.9, MEPL may, at its sole cost and expense, exploit Products in
the Field in the Territory in such manner as it thinks fit.

	5.2	 	Commercialisation

MEPL must, and must procure that each of its agents, contractors and sub-licensees:

	 	(a)	 	conduct any marketing and commercialisation activities on a commercially
reasonable basis, in compliance with any applicable laws, rules and regulations of any
Government Agency;
	 
	 	(b)	 	observe all reasonable directions and instructions given to it by Novogen
Research about marketing and commercialisation of any Product, including directions
about the preparation of or amendment of any advertising, publicity, sales literature
or other document relating to the Product; and
	 
	 	(c)	 	otherwise act as it reasonably considers to be most beneficial to the interests
of MEPL and Novogen Research.

	5.3	 	Records and customer relations

MEPL must, and must procure that each of its agents, contractors and sub-licensees:

	 	(a)	 	keep accurate and separate records and accounts of the supply of Products
sufficient to enable the recall of Products by batch number, and must submit copies of
those records to Novogen Research immediately upon request by Novogen Research;
	 
	 	(b)	 	note details of any customer complaints about Products and details of any
return of any Product and must provide those details to Novogen Research in writing as
soon as is practicable after becoming aware of them;
	 
	 	(c)	 	provide all reasonable assistance to Novogen Research if Novogen Research
wishes to investigate any customer complaint or return of any Product; and
	 
	 	(d)	 	consult with Novogen Research regarding any action to be taken about any
customer complaint or return of any Product.

	5.4	 	Marketing and promotion

MEPL must, and must procure that its agents, contractors and sub-licensees:

	 	(a)	 	act in good faith towards Novogen Research and actively promote sales of
Products and develop markets for Products throughout the Territory;
	 
	 	(b)	 	not during the Term do anything which might injure or destroy the market in the
Territory for Products;

13.

 

	 	(c)	 	subject to applicable laws and regulations in the Territory, advertise Products
to keep customers and potential customers informed of them;
	 
	 	(d)	 	subject to applicable laws and regulations in the Territory, disseminate
samples of Products and technical and promotional literature about Products; and
	 
	 	(e)	 	subject to applicable laws and regulations in the Territory, establish
advertising or promotional programs for Products.

	5.5	 	Approval of promotional and advertising material

MEPL must, and must procure that its agents, contractors and sub-licensees:

	 	(a)	 	submit to Novogen Research for prior approval by Novogen Research
representative samples of any promotional piece, advertising or technical narrative in
relation to Products;
	 
	 	(b)	 	use promotional pieces, advertising and technical narratives only in accordance
with the prior written consent of Novogen Research and any conditions attaching to that
consent; and
	 
	 	(c)	 	make no representation or warranty about Products except with the prior written
consent of Novogen Research.

	5.6	 	Compliance with laws

No consent granted by Novogen Research under clause 5.5 shall relieve MEPL of its
obligations under this clause 5 and MEPL remains solely responsible for the compliance of
any promotional activity with applicable laws despite any consent by Novogen Research under
clause 5.5.

	5.7	 	Storage and handling

MEPL must, and must procure that its agents, contractors and sub-licensees:

	 	(a)	 	store Products safely and securely and in accordance with the reasonable
written directions of Novogen Research from time to time; and
	 
	 	(b)	 	permit Novogen Research to inspect Products in the possession, custody or
control of MEPL, its agents, contractors and sub-licensees.

	5.8	 	Compliance with laws

MEPL must, and must procure that its agents, contractors and sub-licensees, ensure that all
Products comply with the requirements of all applicable laws in jurisdictions within the
Territory in which MEPL exploits those Products, and MEPL must inform Novogen Research
immediately in writing upon becoming aware of any failure to comply with those requirements.

14.

 

	5.9	 	Packing and transport of Products

MEPL must, and must procure that its agents, contractors and sub-licensees, ensure that all
Products are stored and packed in a secure and appropriate manner so that the Products are
reasonably likely to reach their destination in good condition under normal conditions of
transport.

	6.	 	START GRANT AGREEMENT

	6.1	 	Acknowledgment

MEPL acknowledges to Novogen Research that:

	 	(a)	 	Novogen Limited has obligations to the Commonwealth under the START Grant
Agreement with respect to the conduct of Clinical Trials and the commercialisation of
Products; and
	 
	 	(b)	 	Novogen Limited has undertaken (or proposes to undertake) to the Commonwealth
under the Deed of Acknowledgment and Undertaking to procure that certain of its
obligations under the START Grant Agreement are fulfilled by its subsidiaries,
including MEPL.

	6.2	 	Compliance with the START Grant Agreement

MEPL must not, and must procure that its agents, contractors and sub-licensees do not:

	 	(a)	 	exercise MEPL’s rights or perform MEPL’s obligations in a manner which is
inconsistent with the obligations of Novogen Limited under the START Grant Agreement;
or
	 
	 	(b)	 	otherwise do anything which may cause Novogen Limited to be in default of its
obligations under the START Grant Agreement or the Deed of Acknowledgment and
Undertaking.

	6.3	 	Compliance with reasonable directions

If at any time during the Term Novogen Limited is in default of its obligations to the
Commonwealth under the START Grant Agreement or the Deed of Acknowledgment and Undertaking,
MEPL must comply with all reasonable directions of Novogen Research to rectify that default.

	7.	 	LICENCE FEES

	7.1	 	First lump sum licence fee

In consideration of the licence granted in clause 1.4, MEPL must pay to Novogen Research a
first lump sum licence fee of US$5,000,000 on the later of:

	 	(a)	 	1 November 2002; or
	 
	 	(b)	 	the date on which the cumulative total of any:

15.

 

	 	(i)	 	funding (whether debt or equity);
	 
	 	(ii)	 	Commercialisation Income; and
	 
	 	(iii)	 	income as a result of or in connection with the sale, hiring
or other disposal of Products,

received by MEPL and its related bodies corporate (other than Novogen Research and
Novogen Laboratories), exceeds US$25,000,000.

	7.2	 	Second lump sum licence fee

In further consideration of the licence granted in clause 1.4, MEPL must pay to Novogen
Research a second lump sum licence fee of US$5,000,000 on the later of:

	 	(a)	 	1 November 2003; or
	 
	 	(b)	 	the date on which the cumulative total of any:

	 	(i)	 	funding (whether debt or equity);
	 
	 	(ii)	 	Commercialisation Income; and
	 
	 	(iii)	 	income as a result of or in connection with the sale, hiring
or other disposal of Products,

received by MEPL and its related bodies corporate (other than Novogen Research and
Novogen Laboratories), exceeds US$50,000,000.

	7.3	 	Royalties during the Exclusivity Period

In further consideration of the licence granted in clause 1.4, MEPL must, during the
Exclusivity Period, pay to Novogen Research:

	 	(a)	 	2.5% of all Net Sales of Products in the Territory, Quarterly in arrears,
within 30 days of the end of each Quarter; and
	 
	 	(b)	 	25% of all Commercialisation Income, Quarterly in arrears within 30 days of the
end of each Quarter.

	7.4	 	Royalties after the Exclusivity Period

In further consideration of the licence granted in clause 1.4, MEPL must, from the
expiration of the Exclusivity Period until the end of the Term, pay to Novogen Research 1.5%
of all Net Sales of Products in the Territory, Quarterly in arrears, within 30 days of the
end of each Quarter.

	7.5	 	Milestone Licence Fees

In further consideration of the licence granted in clause 1.4, MEPL must pay to Novogen
Research the Milestone Licence Fees during the Exclusivity Period. MEPL must pay:

16.

 

	 	(a)	 	each Milestone Licence Fee payable for a calendar year within 30 days following
the end of the relevant calendar year; and
	 
	 	(b)	 	the Milestone Licence Fee payable on the Approval Date within 30 days following
the Approval Date.

	8.	 	PAYMENT TERMS

	8.1	 	Payments

All amounts due and payable under clause 7 must be calculated and paid in United States
dollars and must be paid by bank cheque or electronic transfer to an account notified by
Novogen Research in writing.

	8.2	 	Interest on overdue accounts

Interest shall accrue at the Default Rate on the outstanding balance of all overdue amounts
payable under clause 7, calculated daily.

	9.	 	REPORTS AND ACCOUNTING

	9.1	 	Books and records

In addition to those records which MEPL must make and keep under clauses 3.6 and 5.3, MEPL
must, and must ensure that its agents, contractors and sublicensees, make, keep and maintain
for the Term and a period of six years after the end of the Term, separate and complete
records and books of account relating to:

	 	(a)	 	all marketing, sale, distribution, exploitation and commercialisation of
Products; and
	 
	 	(b)	 	any assignment, sublicensing, or other dealing with MEPL’s rights under this
document,

which must contain clear particulars sufficient to enable the calculation of all amounts
payable under clause 7.

	9.2	 	Auditor’s certificates

Within 60 days of a written request by Novogen Research at any time during the Term or
within six years after the end of the Term, MEPL must produce a certificate by the auditors
or accountants of MEPL as to the accuracy and completeness of the records and books of
account referred to in clause 13.1.

	9.3	 	Quarterly statements

MEPL must, and must procure that its agents, contractors and sub-licensees, prepare
statements for each Quarter showing:

	 	(a)	 	the progress of marketing and commercialisation of Products;

17.

 

	 	(b)	 	details of any Commercialisation Income received by or on behalf of MEPL and
its subsidiaries in the period to which the statement relates;
	 
	 	(c)	 	details of any funding received by or on behalf of MEPL and its subsidiaries,
by way of debt, equity or otherwise;
	 
	 	(d)	 	details of all income received by or on behalf of MEPL and its subsidiaries as
a result of or in connection with the sale, hiring or other disposal of Product; and
	 
	 	(e)	 	the calculation of any payments due under clause 7;

and must submit those statements to Novogen Research within 30 days of the end of the
Quarter to which they relate, together with payment of the amount due to Novogen Research
under clause 7. All figures in the statements must be in United States dollars.

	9.4	 	Certification

Novogen Research may give notice to MEPL at any time that it disputes any statement
submitted by MEPL under clause 9.3 and that it wishes to have the statement certified by an
independent accountant at its own cost. In order to do so, Novogen Research and its nominee
may inspect MEPL’s records and books of account, and those of MEPL’s contractors and
sub-licensees under clause 9.7.

	9.5	 	Adjustments

	 	(a)	 	A certification of a statement under clause 9.4 is final and binding on the
parties.
	 
	 	(b)	 	Within 14 days of notice in writing by Novogen Research of the certification
under clause 9.4, the parties must make any adjustments required as a result of the
certification, including:

	 	(i)	 	any refund by Novogen Research to MEPL of the amount of any
overpayment; and
	 
	 	(ii)	 	any payment by MEPL to Novogen Research of the amount of any
underpayment.

	 	(c)	 	If the certification reveals the amount paid to Novogen Research was
underestimated by 5% or more, then within 14 days of notice of the certification, MEPL
must also reimburse Novogen Research the cost of certification.

	9.6	 	Interest on adjustments

Interest at the Default Rate (calculated daily) on the amounts payable under clause 9.5
accrues from and including the 14th day after the date of notice of the
certification by Novogen Research to MEPL.

	9.7	 	Inspection

Novogen Research may, during normal business hours and upon reasonable notice, by its
authorised representatives (including accountants and auditors) inspect the records and
books of account referred to in clause 9.1. Such authorised representatives may take such

18.

 

copies and extracts of the records and books of account as they think fit and MEPL must, and
must ensure that its contractors and sublicensees give such authorised representatives such
assistance as is necessary, including by providing access to facilities, hardware, software
and documents, to enable the Commercialisation Income and all amounts payable by MEPL to
Novogen Research under this document to be ascertained or verified.

	10.	 	OTHER COSTS

	10.1	 	Maintenance of Licensed Patent Rights

Subject to clause 10.2, Novogen Research is responsible at its sole cost and expense for
filing, prosecution and maintenance in the Territory of the Licensed Patent Rights.

	10.2	 	Reimbursement by MEPL

MEPL must reimburse Novogen Research one half of the costs incurred by Novogen Research
during the Exclusivity Period in filing, prosecuting and maintaining the Licensed Patent
Rights, within 30 days of presentation by Novogen Research of invoices for those amounts,
together with copies of all invoices, receipts and other documents evidencing those costs.

	10.3	 	Registration of Products

MEPL must, at its own cost and expense:

	 	(a)	 	register and maintain the registration of Products for use in the Field in
accordance with any applicable laws, rules and regulations of any Government Agency;
and
	 
	 	(b)	 	do everything necessary to apply for and obtain each Authorisation from a
Government Agency required by any applicable law in the Territory for the importation,
promotion, distribution, storage, sale and use of Products in the Field.

	11.	 	GOODS AND SERVICES TAX

	11.1	 	GST Law definitions

Words defined in the GST Law have the same meaning in this clause 11, unless the context
makes it clear that a different meaning is intended.

	11.2	 	GST payable in addition to other amounts

In addition to paying all amounts payable by MEPL under this document, MEPL must:

	 	(a)	 	pay to Novogen Research an amount equal to any GST payable on any supply by
Novogen Research under or in connection with this document without deduction or set-off
of any other amount;
	 
	 	(b)	 	make that payment:

	 	(i)	 	if Novogen Research must pay GST on or after receiving the
consideration or any part of it — as and when MEPL must pay or provide the
consideration or that part of it;

19.

 

	 	(ii)	 	if Novogen Research must pay GST on issuing an invoice under
this document — on the earlier of the due date for payment of that invoice, or
10 Business Days following the end of the month in which Novogen Research
issued that invoice; and
	 
	 	(iii)	 	if Novogen Research must pay GST upon the occurrence of some
other event — within 5 Business Days of a written request by Novogen Research
for payment for the GST, which may be in the form of a tax invoice (or an
adjustment note); and

	 	(c)	 	indemnify Novogen Research against, and pay Novogen Research on demand the
amount of:

	 	(i)	 	all GST on the transactions contemplated by this document; and
	 
	 	(ii)	 	any loss, liability or expense directly or indirectly incurred
in connection with or arising from or caused by any failure by MEPL to pay any
amount as and when required by this clause 11, for example, any additional tax,
penalty tax, fine, interest or other charge under a GST Law.

	11.3	 	Tax invoice

Within 28 days of a written request from MEPL, Novogen Research must issue a tax invoice (or
an adjustment note) to MEPL for any supply for which Novogen Research may recover GST from
MEPL under this document, and must include in the tax invoice (or adjustment note) the
particulars required by the GST Law for MEPL to obtain an input tax credit for that GST.

	11.4	 	Adjustments

Novogen Research must refund to MEPL any overpayment by MEPL for GST, but Novogen Research
need not refund to MEPL any amount for GST paid to the Commissioner of Taxation unless
Novogen Research has received a refund or credit of that amount.

	11.5	 	GST where MEPL supplies Novogen Research

If MEPL must pay GST for anything provided or supplied by MEPL under this document, Novogen
Research must pay to MEPL an amount equal to that GST in exactly the same way as MEPL must
so do for any GST Novogen Research must pay, and this clause 11 applies to that GST as if
MEPL was Novogen Research, and Novogen Research was MEPL.

	12.	 	OTHER DEDUCTIONS AND WITHHOLDINGS

If at any time an applicable law obliges MEPL to make a deduction or withholding in respect
of any Tax from any payment by MEPL to Novogen Research under this document, MEPL must:

	 	(a)	 	notify Novogen Research of the obligation promptly after MEPL becomes aware of
it;

20.

 

	 	(b)	 	ensure that the deduction or withholding does not exceed the minimum amount
required by law;
	 
	 	(c)	 	pay to the relevant Government Agency on time the full amount of the deduction
or withholding and promptly deliver to Novogen Research a copy of any receipt,
certificate or other proof of payment; and
	 
	 	(d)	 	indemnify Novogen Research against the deduction or withholding, by paying to
Novogen Research, at the time that the payment is due, an additional amount that
ensures that, after the deduction or withholding is made, Novogen Research receives a
net sum equal to the sum that it would have received if the deduction or withholding
had not been made.

	13.	 	INTELLECTUAL PROPERTY RIGHTS

	13.1	 	Acknowledgment

Each party acknowledges that nothing in this document effects an assignment or transfer to
MEPL of any right, title or interest in the Licensed Intellectual Property, and MEPL must
not represent that it has any right, title or interest in the Licensed Intellectual Property
other than the rights expressly granted to it under this document.

	13.2	 	Maintenance of Licensed Intellectual Property

MEPL must do all things necessary in storing, manufacturing, packing, supplying,
commercialising and otherwise dealing with the Products to maintain the Licensed
Intellectual Property and must not cause or permit to be done anything which may damage or
endanger the Licensed Intellectual Property.

	13.3	 	Notification

MEPL must notify Novogen Research immediately upon becoming aware of:

	 	(a)	 	any actual or apparent infringement by any person of the Licensed Intellectual
Property; or
	 
	 	(b)	 	any assertion or claim by any person that the activities of a party under this
document infringe the Intellectual Property Rights of any person.

	13.4	 	Proceedings by MEPL

Subject to clauses 13.5 and 13.7, MEPL may in its discretion and for its own benefit enforce
and defend in the Territory the Licensed Intellectual Property during the Exclusivity
Period, and in the event it does so, MEPL shall have the conduct and control of any
proceedings, including the right to settle them.

	13.5	 	Directions by Novogen Research

During the Exclusivity Period, MEPL shall take such proceedings in respect of any actual or
suspected infringement in the Territory of the Licensed Intellectual Property, and shall

21.

 

defend any claim of infringement against the parties, as directed by notice in writing by
Novogen Research from time to time.

	13.6	 	Joinder of Novogen Research

If it is necessary that Novogen Research be a party to any proceedings commenced by MEPL,
Novogen Research shall join such proceedings as a plaintiff and shall at MEPL’s cost provide
all reasonable assistance, and execute any documents MEPL reasonably requests, in relation
to the proceedings.

	13.7	 	Proceedings by Novogen Research

If MEPL fails to take or defend any proceedings within 28 days of receipt of a notice under
clause 13.5, then without prejudice to any other right Novogen Research may have, Novogen
Research may commence or defend those proceedings itself, and in the event it does so
Novogen Research shall have the conduct and control of the proceedings including the right
to settle them.

	13.8	 	Joinder of MEPL

If it is necessary that MEPL be a party to any proceedings taken under clause 13.7, MEPL
shall join such proceedings as a plaintiff and shall provide all reasonable assistance, and
execute any documents Novogen Research reasonably requests, in relation to the proceedings.

	13.9	 	Damages and settlement amounts

If in any proceedings commenced by Novogen Research under clause 13.7, damages or an account
of profits are awarded to any party to this document, or an amount is received by any party
by way of settlement of those proceedings, all such damages, profits and settlement amounts
must be paid to Novogen Research within 5 Business Days of receipt.

	13.10	 	Assignment of Intellectual Property Rights

For the avoidance of doubt, if in any proceedings commenced or defended under this clause
13, a court makes an order in favour of a party to this document other than Novogen Research
in relation to the ownership of any Intellectual Property Rights forming part of the
Licensed Intellectual Property, the parties agree that those Intellectual Property Rights
are by this document assigned absolutely to Novogen Research.

	14.	 	CONFIDENTIAL INFORMATION

	14.1	 	Confidentiality

Each party must:

	 	(a)	 	keep and maintain all Confidential Information of the other party strictly
confidential;
	 
	 	(b)	 	use Confidential Information of the other parties only for the purposes for
which it is disclosed; and

22.

 

	 	(c)	 	not disclose any Confidential Information of another party other than to its
employees, authorised sub-contractors, legal advisers, auditors or other consultants
requiring the information for the purposes of this document and then only upon those
persons undertaking in writing to keep that information strictly confidential.

	14.2	 	Security

For the purposes of clause 14.1, each party must establish and maintain effective security
measures to safeguard the Confidential Information of the other party from unauthorised use
or access and must notify the Disclosing Party immediately upon becoming aware of any
suspected or actual unauthorised use or disclosure of its Confidential Information.

	14.3	 	Exceptions to obligations of confidentiality

The obligations in clauses 14.1 and 14.2 do not apply to the extent that a party is required
by law to disclose any Confidential Information, provided the party promptly gives notice to
the Disclosing Party of that requirement and discloses only that portion of its Confidential
Information which it is legally required to disclose.

	14.4	 	Public domain

No Confidential Information shall be deemed to be in the public domain merely because it
contains information which is in the public domain or is embraced by a general disclosure
which is in the public domain.

	15.	 	REPRESENTATIONS AND WARRANTIES

	15.1	 	Warranties of each party

Each party represents and warrants that:

	 	(a)	 	(status) it is a company limited by shares under the Corporations Act;
	 
	 	(b)	 	(power) it has full legal capacity and power to:

	 	(i)	 	own its property and to carry on its business; and
	 
	 	(ii)	 	enter into this document and to carry out the transactions that
this document contemplates;

	 	(c)	 	(corporate authority) it has taken all corporate action that is necessary or
desirable to authorise its entry into this document and its carrying out the
transactions that this document contemplates;
	 
	 	(d)	 	(Authorisations) it holds each Authorisation that is necessary or desirable to:

	 	(i)	 	enable it to properly execute this document and to carry out
the transactions that this document contemplates;
	 
	 	(ii)	 	ensure that this document is legal, valid, binding and
admissible in evidence; or

23.

 

	 	(iii)	 	enable it to properly carry on its business,

and it is complying with any conditions to which any of these Authorisations is
subject;

	 	(e)	 	(documents effective) this document constitutes its legal, valid and binding
obligations, enforceable against it in accordance with its terms (except to the extent
limited by equitable principles and laws affecting creditors’ rights generally),
subject to any necessary stamping or registration;
	 
	 	(f)	 	(no contravention) neither its execution of this document nor the carrying out
by it of the transactions that this document contemplates, does or will:

	 	(i)	 	contravene any law to which it or any of its property is
subject or any order of any Government Agency that is binding on it or any of
its property;
	 
	 	(ii)	 	contravene any Authorisation;
	 
	 	(iii)	 	contravene any undertaking or instrument binding on it or any
of its property;
	 
	 	(iv)	 	contravene its constitution; or
	 
	 	(v)	 	require it to make any payment or delivery in respect of any
financial indebtedness before it would otherwise be obliged to do so.

	15.2	 	Representations and warranties by Novogen Research

Novogen Research represents and warrants that:

	 	(a)	 	(ownership) to the best of its knowledge Novogen Research is the legal and
beneficial owner of the Licensed Intellectual Property and to the best of its knowledge
no other person has or shall have any claim of ownership with respect to the Licensed
Intellectual Property;
	 
	 	(b)	 	(no dealings) subject to the START Grant Agreement, it has not assigned or
granted to any person any right, title or interest in or in relation to the Licensed
Intellectual Property;
	 
	 	(c)	 	(no Encumbrance) subject to the Fixed and Floating Charge, the Licensed
Intellectual Property is free from any Encumbrance;
	 
	 	(d)	 	(filing, prosecution and maintenance) Novogen Research has diligently filed,
prosecuted and maintained the patents and patent applications listed in schedule 1 and
as at the Commencement Date all filing, prosecution and maintenance fees have been
paid;
	 
	 	(e)	 	(confidentiality) to its knowledge Novogen Research has kept the Licensed Know
How confidential and to its knowledge there has been no breach of that confidentiality;

24.

 

	 	(f)	 	(no infringement) to its knowledge the exercise by MEPL, in any country
in which a patent application in schedule 1 has been filed, of the rights granted to
MEPL under this document with respect to the Licensed Intellectual Property does not
infringe the Intellectual Property Rights of any person; and
	 
	 	(g)	 	(no further Patent Rights) other than the Licensed Patent Rights, Novogen
Research has no Patent Rights which are necessary in order for MEPL to exercise its
rights and perform its obligations under this document.

	15.3	 	Validity of Licensed Patent Rights
	 
	 	 	MEPL acknowledges that Novogen Research makes and has made no representation, warranty,
statement or promise to the effect that:

	 	(a)	 	any letters patent will be granted in respect of the Licensed Intellectual
Property in any country in the Territory; or
	 
	 	(b)	 	if any letters patent are granted in respect of the Licensed Intellectual
Property in any country in the Territory, such letters patent will be valid.

	15.4	 	Reliance on representations and warranties
	 
	 	 	Each party acknowledges that the other party has executed this document and agreed to take
part in the transactions that this document contemplates in reliance on the representations
and warranties that are made in this document.

	16.	 	LIMITATION OF LIABILITY
	 
	16.1	 	Limitation of liability of Novogen Research
	 
	 	 	Subject to clause 16.2 and to the extent permitted by law, the liability of Novogen Research
to MEPL under this document and any other liability of Novogen Research to MEPL, whether in
contract, tort (including negligence and breach of statutory duty) or otherwise is limited
to US$200,000.
	 
	16.2	 	Liability for infringement of Intellectual Property Rights
	 
	 	 	Clause 16.1 does not apply to any liability which Novogen Research may have to MEPL with
respect to any breach by Novogen Research of the representations and warranties in clauses
15.2(a), (b), (c) and (f).
	 
	16.3	 	Exclusion of conditions and warranties
	 
	 	 	Except for the warranties expressly made in this document, all conditions, warranties,
undertakings or representations express or implied arising by statute, general law or
otherwise are expressly excluded to the extent permitted by law.
	 
	16.4	 	Indirect and consequential loss
	 
	 	 	Notwithstanding any other provision of this document, and to the extent permitted by law, in
no circumstances is Novogen Research liable in contract, tort (including negligence or
breach of statutory duty) or otherwise, and whatever the cause, to compensate MEPL for:

25.

 

	 	(a)	 	any increased costs or expenses;
	 
	 	(b)	 	any economic loss, loss of profit, revenue, business, contracts or anticipated
savings; or
	 
	 	(c)	 	any other special, indirect or consequential loss or damage of any nature.

	17.	 	INDEMNITIES AND INSURANCE
	 
	17.1	 	Clinical Trial indemnity
	 
	 	 	MEPL must indemnify and keep indemnified Novogen Research, its directors, employees and
agents against all damages, costs or expenses (including legal costs and expenses on an
indemnity basis) in respect of any claims, demands, actions, proceedings or prosecution
which may be brought or commenced as a result of or in relation to:

	 	(a)	 	the conduct of Clinical Trials generally; or
	 
	 	(b)	 	any personal injury to or death of a Clinical Trial Subject arising out of or
relating to the administration of the Products or any clinical intervention or
procedure provided for or required for the purposes of the Clinical Trials to which the
Clinical Trial Subjects would not have been exposed but for their participation in the
Clinical Trials,

except to the extent that the claim, demand, action, proceeding or prosecution arose from an
action or omission of MEPL in accordance with a direction given by Novogen Research under
this document or from any negligence (including breach of statutory duty) of Novogen
Research or any breach by Novogen Research of its obligations under this document.

	17.2	 	Commercialisation indemnity
	 
	 	 	MEPL must indemnify and keep indemnified Novogen Research, its directors, employees and
agents against all damages, costs or expenses (including legal costs and expenses on an
indemnity basis) in respect of any claims, demands, actions, proceedings or prosecution
which may be brought or commenced as a result of or in relation to:

	 	(a)	 	the licensing or sub-licensing of the Licensed Intellectual Property;
	 
	 	(b)	 	the sale, distribution or other commercialisation or exploitation of Products; or
	 
	 	(c)	 	any packaging, marketing, advertisement or promotion of Products,

by MEPL, its employees, agents, contractors and sub-licensees, including any warranty
claims, product liability claims, product recalls and claims for personal injury or property
damage, except to the extent that the claim, demand, action, proceeding or prosecution arose
from an action or omission of MEPL in accordance with a direction given by Novogen Research
under this document, from the negligence (including breach of statutory duty) of Novogen
Research or the breach by Novogen Research of its obligations under this document.

26.

 

	17.3	 	MEPL’s insurance policies
	 
	 	 	MEPL must take out and maintain in force in the Territory comprehensive general liability
insurance including advertising and product liability insurance for personal injury and
property damage and product recall insurance, in relation to all Products on terms
satisfactory to Novogen Research.
	 
	17.4	 	Name of Novogen Research
	 
	 	 	If requested by Novogen Research, MEPL must ensure that that Novogen Research is included on
the policies referred to in clause 17.3 as a joint insured or loss payee.
	 
	17.5	 	Certificates of currency
	 
	 	 	At the request of Novogen Research from time to time, MEPL must provide to Novogen Research
a certificate of currency evidencing its compliance with its obligations under this clause
17.
	 
	17.6	 	Default
	 
	 	 	If within 15 Business Days of a request by Novogen Research under clause 17.5, MEPL does not
comply with its obligations under that clause, Novogen Research may (but is not obliged to)
take out and maintain the insurance and may recover any premiums paid as a debt due by MEPL.
	 
	17.7	 	Expiry
	 
	 	 	MEPL shall maintain each insurance policy referred to in clause 17.3 until the expiry date
of the last Product sold, hired or otherwise disposed of by or on behalf of MEPL or its
sub-licensees.
	 
	17.8	 	Novogen Research’s insurance
	 
	 	 	Novogen Research must take out and maintain in force in the Territory comprehensive general
liability insurance policies in relation to its obligations under this document on terms
reasonably satisfactory to MEPL.
	 
	18.	 	FORCE MAJEURE
	 
	18.1	 	Notice and suspension of obligations
	 
	 	 	If a party to this document is affected, or likely to be affected, by a Force Majeure Event:

	 	(a)	 	that party must immediately give the other prompt notice of that fact
including:

	 	(i)	 	full particulars of the Force Majeure Event;
	 
	 	(ii)	 	an estimate of its likely duration;
	 
	 	(iii)	 	the obligations affected by it and the extent of its effect on
those obligations; and

27.

 

	 	(iv)	 	the steps taken to rectify it; and

	 	(b)	 	the obligations under this document of the party giving the notice are
suspended to the extent to which they are affected by the relevant Force Majeure Event
as long as the Force Majeure Event continues.

	18.2	 	Effort to overcome
	 
	 	 	A party claiming a Force Majeure Event must use its best endeavours to remove, overcome or
minimise the effects of that Force Majeure Event as quickly as possible. However, this does
not require a party to settle any industrial dispute in any way it does not want to.
	 
	18.3	 	Termination
	 
	 	 	If a Force Majeure Event continues for more than 3 months, any party may terminate this
document by giving at least 10 Business Days notice to the other parties.
	 
	19.	 	TERM AND TERMINATION
	 
	19.1	 	Term

	 	(a)	 	Subject to paragraph (b), the rights and obligations of the parties under this
document begin on the Commencement Date and continue until this document is terminated
in accordance with this clause 19.
	 
	 	(b)	 	The variations made by this document to the Original Licence Agreement are
effective from the date of this document.

	19.2	 	Termination by Novogen Research
	 
	 	 	Novogen Research may terminate this document at any time:

	 	(a)	 	immediately if MEPL defaults in the performance of any of its obligations under
this document which in Novogen Research’s reasonable opinion is capable of remedy and
fails to remedy that default within 21 days of receiving written notice from Novogen
Research specifying the default and requiring the default to be remedied;
	 
	 	(b)	 	on 21 days written notice if MEPL defaults in the performance of any of its
material obligations under this document which in Novogen Research’s reasonable opinion
is not capable of remedy; and
	 
	 	(c)	 	immediately by notice in writing if:

	 	(i)	 	there is a Change of Control of MEPL without Novogen Research’s
written consent (which shall not be unreasonably withheld or delayed or
conditioned);
	 
	 	(ii)	 	MEPL is involved in an Insolvency Event; or

28.

 

	 	(iii)	 	MEPL ceases for any reason to be able lawfully to carry out
all the transactions which this document contemplates may be carried out by
MEPL.

	19.3	 	Termination by MEPL
	 
	 	 	MEPL may terminate this document at any time:

	 	(a)	 	on three month’s written notice to Novogen Research;
	 
	 	(b)	 	immediately if Novogen Research defaults in the performance of any of its
obligations under this document which in MEPL’s reasonable opinion is capable of remedy
and fails to remedy that default within 21 days of receiving written notice from MEPL
specifying the default and requiring the default to be remedied;
	 
	 	(c)	 	on 21 days written notice if Novogen Research defaults in the performance of
any of its material obligations under this document which in MEPL’s reasonable opinion
is not capable of remedy; and
	 
	 	(d)	 	immediately by notice in writing if:

	 	(i)	 	Novogen Research is involved in an Insolvency Event; or
	 
	 	(ii)	 	Novogen Research ceases for any reason to be able lawfully to
carry out all the transactions which this document contemplates may be carried
out by Novogen Research.

	19.4	 	Consequences to MEPL of termination
	 
	 	 	Upon termination of this document MEPL must:

	 	(a)	 	immediately cease using and exploiting the Products;
	 
	 	(b)	 	within 14 Business Days return to Novogen Research or destroy at Novogen
Research’s election, all Products, Clinical Trial Materials, all copies (including
electronic copies) of any labelling and packaging materials relating to Products and
any other Confidential Information of Novogen Research in MEPL’s possession, custody or
power; and
	 
	 	(c)	 	cooperate with Novogen Research and do everything necessary to bring about the
orderly and medically and ethically permissible termination of all Clinical Trials,
	 
	 	 	 	provided that MEPL may complete in accordance with its obligations under this document any
contracts for sale or supply of Products to which MEPL is bound prior to the date of
termination.

	19.5	 	Consequences to Novogen Research of termination
	 
	 	 	Upon termination of this document Novogen Research must return to MEPL or destroy at MEPL’s
election within 10 Business Days, all Confidential Information of MEPL in the possession,
custody or power of Novogen Research.

29.

 

	19.6	 	Survival and accrued rights
	 
	 	 	Upon termination under this clause 19, this document is at an end as to its future operation
except for:

	 	(a)	 	the enforcement of any right or claim which arises on or has arisen before
termination; and
	 
	 	(b)	 	the obligations of the parties under clauses 1, 3.6, 3.7, 3.9, 5.3, 9, 13.1,
13.9, 14, 16, 17, 20, 21 and 23 (except clause 23.4) and this clause 19 which survive
termination.

	20.	 	DISPUTE RESOLUTION
	 
	20.1	 	Disputes
	 
	 	 	If a dispute arises out of or in relation to this document (including any dispute as to
breach or termination of the document or as to any claim in tort, in equity or pursuant to
any statute) (a “Dispute”), a party to this document may not commence any court or
arbitration proceedings relating to the Dispute unless it has complied with this clause 20
except where the party seeks urgent interlocutory relief.
	 
	20.2	 	Notice of Dispute
	 
	 	 	A party to this document claiming that a Dispute has arisen under or in relation to this
document must give written notice to the other party specifying the nature of the Dispute (a
“Dispute Notice”).
	 
	20.3	 	Negotiation
	 
	 	 	Upon receipt by a party of a Dispute Notice, Novogen Research and MEPL must procure that
their respective Managing Directors meet to endeavour to resolve the Dispute expeditiously
by negotiation.
	 
	20.4	 	Resolution of Dispute
	 
	 	 	If the parties have not resolved the Dispute under clause 20.3 within 14 days of receipt of
a Dispute Notice, the parties must endeavour to resolve the Dispute expeditiously using
informal dispute resolution techniques such as mediation, expert evaluation or determination
or similar techniques agreed by the parties.
	 
	20.5	 	Mediation
	 
	 	 	If the parties do not agree within 28 days of receipt of a Dispute Notice (or such further
period as the parties agree in writing) as to:

	 	(a)	 	the dispute resolution technique and procedures to be adopted;
	 
	 	(b)	 	the timetable for all steps in those procedures; and
	 
	 	(c)	 	the selection and compensation of the independent person required for such
technique,

30.

 

	 	 	 	the parties must mediate the Dispute in accordance with the Mediation Rules of the Law
Society of New South Wales.

	21.	 	NOTICES

	 	(a)	 	A notice, consent or other communication under this document is only effective
if it is in writing, signed and either left at the addressee’s address or sent to the
addressee by mail or fax. If it is sent by mail, it is taken to have been received 3
working days after it is posted. If it is sent by fax, it is taken to have been
received when the addressee actually receives it in full and in legible form.
	 
	 	(b)	 	The parties’ addresses and fax numbers are those set out below, or as a party
notifies the other:

	 	 	 	 
	 	Novogen Research

	 	 
	 	Address:

	 	140 Wicks Road, North Ryde NSW 2113 AUSTRALIA
	 	Fax number:

	 	Int + 612 9878 0055
	 	Attention:

	 	Managing Director
	 	 
	 	 
	 	MEPL

	 	 
	 	Address:

	 	140 Wicks Road, North Ryde NSW 2113 AUSTRALIA
	 	Fax number:

	 	Int + 612 9878 0055
	 	Attention:

	 	Managing Director

	22.	 	AMENDMENT AND ASSIGNMENT
	 
	22.1	 	Amendment
	 
	 	 	This document can only be amended, supplemented, replaced or novated by another document
signed by the parties.
	 
	22.2	 	Assignment

	 	(a)	 	MEPL may only dispose of, declare a trust over or otherwise create an interest
in its rights under this document with the prior written consent of Novogen Research.
	 
	 	(b)	 	Novogen Research may dispose of, declare a trust over or otherwise create an
interest in its rights under this document without the consent of MEPL, and may
disclose to any potential holder of the right or interest any information relating to
this document or any party to it.

	23.	 	GENERAL
	 
	23.1	 	Governing law

	 	(a)	 	This document is governed by the law in force in New South Wales.
	 
	 	(b)	 	Each party submits to the non-exclusive jurisdiction of the courts exercising
jurisdiction in New South Wales, and any court that may hear appeals from any of those
courts, for any proceedings in connection with this document, and waives any right it
might have to claim that those courts are an inconvenient forum.

31.

 

	23.2	 	Liability for expenses
	 
	 	 	Each party must pay its own expenses incurred in negotiating, executing, stamping and
registering this document.
	 
	23.3	 	Relationship of the parties
	 
	 	 	Nothing in this document creates a relationship of employment, partnership or joint venture
between the parties under the laws of any applicable jurisdiction and no party may act or
has the authority to act as agent of or in any way bind or commit another party to any
obligation.
	 
	23.4	 	Giving effect to this document
	 
	 	 	Each party must do anything (including execute any document), and must ensure that its
employees and agents do anything (including execute any document), that the other party may
reasonably require to give full effect to this document.
	 
	23.5	 	Waiver of rights
	 
	 	 	A right may only be waived in writing, signed by the party giving the waiver, and:

	 	(a)	 	no other conduct of a party (including a failure to exercise, or delay in
exercising, the right) operates as a waiver of the right or otherwise prevents the
exercise of the right;
	 
	 	(b)	 	a waiver of a right on one or more occasions does not operate as a waiver of
that right if it arises again; and
	 
	 	(c)	 	the exercise of a right does not prevent any further exercise of that right or
of any other right.

	23.6	 	Operation of this document

	 	(a)	 	This document contains the entire document between the parties about its
subject matter. Any previous understanding, document, representation or warranty
relating to that subject matter is replaced by this document and has no further effect.
	 
	 	(b)	 	Any right that a person may have under this document is in addition to, and
does not replace or limit, any other right that the person may have.
	 
	 	(c)	 	Any provision of this document which is unenforceable or partly unenforceable
is, where possible, to be severed to the extent necessary to make this document
enforceable, unless this would materially change the intended effect of this document.

	23.7	 	Operation of indemnities

	 	(a)	 	Each indemnity in this document survives the expiry or termination of this
document.

32.

 

	 	(b)	 	A party may recover a payment under an indemnity in this document before it
makes the payment.

	23.8	 	Consents
	 
	 	 	Where this document contemplates that a party may agree or consent to something (however it
is described), that party may:

	 	(a)	 	agree or consent, or not agree or consent, in its absolute discretion; and
	 
	 	(b)	 	agree or consent subject to conditions,
	 
	 	 	 	unless this document expressly contemplates otherwise.

	23.9	 	Exclusion of contrary legislation
	 
	 	 	Any legislation that adversely affects an obligation of a party, or the exercise by a party
of a right or remedy, under or relating to this document is excluded to the full extent
permitted by law.
	 
	23.10	 	Counterparts
	 
	 	 	This document may be executed in counterparts.

	 	 	 
	EXECUTED as an agreement.
	 	 
	 
	 	 
	EXECUTED by NOVOGEN RESEARCH 

PTY LIMITED
	 	 
	 
	 	 
	 

	 	 
	Signature of director

	 	Signature of director/secretary
	 
	 	 
	 

	 	 
	Name of director

	 	Name of director/secretary
	 
	 	 
	EXECUTED by MARSHALL 

EDWARDS PTY LIMITED
	 	 
	 
	 	 
	 

	 	 
	Signature of director

	 	Signature of director/secretary
	 
	 	 
	 

	 	 
	Name of director

	 	Name of director/secretary

33.

 

SCHEDULE 1

Product Patent Rights

	 	 	 	 	 
	Application/patent	 	No.	 	Status
	 
	 	 	 	 
	Australia
	 	731951	 	Granted
	 
	 	 	 	 
	Australia
	 	19723/01	 	Under examination
	 
	 	 	 	 
	Australia
	 	750031	 	Granted
	 
	 	 	 	 
	Australia
	 	PP1124	 	Completed
	 
	 	 	 	provisional patent
	 
	 	 	 	application
	 
	 	 	 	 
	Australia
	 	PO2039	 	Completed
	 
	 	 	 	provisional patent
	 
	 	 	 	application
	 
	 	 	 	 
	Australia
	 	PS1594	 	Completed
	 
	 	 	 	provisional patent
	 
	 	 	 	application
	 
	 	 	 	 
	Australia
	 	2002950294	 	Completed
	 
	 	 	 	provisional patent
	 
	 	 	 	application
	 
	 	 	 	 
	Australia
	 	2002951607	 	Completed
	 
	 	 	 	provisional patent
	 
	 	 	 	application
	 
	 	 	 	 
	Australia
	 	2002953453	 	Completed
	 
	 	 	 	provisional patent
	 
	 	 	 	application
	 
	 	 	 	 
	Brazil
	 	9713180-6	 	Under examination
	 
	 	 	 	 
	Brazil
	 	9814343-3	 	Under examination
	 
	 	 	 	 
	Canada
	 	2,265,049	 	Under examination
	 
	 	 	 	 
	Canada
	 	2316349	 	Pending
	 
	 	 	 	 
	Czech Republic
	 	PV 699-99	 	Under examination
	 
	 	 	 	 
	Europe
	 	97937345.3	 	Pending
	 
	 	 	 	 
	Europe
	 	98960911.0	 	Pending
	 
	 	 	 	 
	Hong Kong
	 	1019553	 	Granted
	 
	 	 	 	 
	Hungary
	 	P9903971	 	Under examination
	 
	 	 	 	 
	Israel
	 	128765	 	Under examination

34.

 

	 	 	 	 	 
	Application/patent	 	No.	 	Status
	 
	Israel
	 	136784	 	Pending
	 
	 	 	 	 
	Japan
	 	10-511105	 	Under examination
	 
	 	 	 	 
	Mexico
	 	992092	 	Pending
	 
	 	 	 	 
	Mexico
	 	006311	 	Pending
	 
	 	 	 	 
	New Zealand
	 	334025	 	Granted
	 
	 	 	 	 
	New Zealand
	 	506063	 	Under examination
	 
	 	 	 	 
	New Zealand
	 	505377	 	Accepted
	 
	 	 	 	 
	Norway
	 	19990965	 	Pending
	 
	 	 	 	 
	Norway
	 	20003201	 	Pending
	 
	 	 	 	 
	People’s Republic
of China
	 	97198690.8	 	Under examination
	 
	 	 	 	 
	Portugal
	 	98/08503	 	Pending
	 
	 	 	 	 
	Singapore
	 	64139	 	Granted
	 
	 	 	 	 
	Singapore
	 	74235	 	Granted
	 
	 	 	 	 
	Sweden
	 	2286-3	 	Under examination
	 
	 	 	 	 
	Turkey
	 	TR19990885B	 	Granted
	 
	 	 	 	 
	Turkey
	 	2000/2064	 	Pending
	 
	 	 	 	 
	United Kingdom
	 	2331015	 	Granted
	 
	 	 	 	 
	United States of
America
	 	09/254026	 	Under examination
	 
	 	 	 	 
	United States of
	 	Serial number not allocated	 	 
	America
	 	Continuation of 09/254026	 	Filed 6 August 2003
	 
	 	 	 	 
	United States of
America
	 	10/212847	 	Under examination
	 
	 	 	 	 
	United States of
America
	 	10/176762	 	Under examination
	 
	 	 	 	 
	United States of
America
	 	6455032	 	Granted
	 
	 	 	 	 
	Zimbabwe
	 	12/99	 	Accepted
	 
	 	 	 	 
	International
	 	PCT/AU03/00427	 	Pending
	 
	 	 	 	 
	International
	 	PCT/AU97/00563	 	National phase
	 
	 	 	 	entry completed

35.

 

	 	 	 	 	 
	Application/patent	 	No.	 	Status
	 
	International
	 	PCT/AU98/01054	 	National phase
	 
	 	 	 	entry completed

36.

 

SCHEDULE 2

Manufacturing Patent Rights

	 	 	 	 	 
	Application	 	No.	 	Status
	 
	 	 	 	 
	Australia
	 	26510/00	 	Under examination
	 
	 	 	 	 
	Australia
	 	PP8685	 	Completed provisional
	 
	 	 	 	patent application
	 
	 	 	 	 
	Brazil
	 	0008222-8	 	Pending
	 
	 	 	 	 
	Canada
	 	2362819	 	Pending
	 
	 	 	 	 
	China
	 	00803816.3	 	Under examination
	 
	 	 	 	 
	Czech Republic
	 	PV 2001-2920	 	Pending
	 
	 	 	 	 
	Europe
	 	00904727.5	 	Under examination
	 
	 	 	 	 
	Hong Kong
	 	02103732.5	 	Pending
	 
	 	 	 	 
	Hungary
	 	PO105218	 	Pending
	 
	 	 	 	 
	Israel
	 	144008	 	Pending
	 
	 	 	 	 
	Japan
	 	2000-599749	 	Pending
	 
	 	 	 	 
	Mexico
	 	008233	 	Pending
	 
	 	 	 	 
	New Zealand
	 	512696	 	Lapsed
	 
	 	 	 	 
	New Zealand
	 	527700 (divisional)	 	Pending
	 
	 	 	 	 
	Norway
	 	20013945	 	Pending
	 
	 	 	 	 
	Singapore
	 	200103867-8	 	Pending
	 
	 	 	 	 
	South Africa
	 	20016502	 	Pending
	 
	 	 	 	 
	Turkey
	 	01/2367	 	Under examination
	 
	 	 	 	 
	United States of America
	 	09/889701	 	Under examination
	 
	 	 	 	 
	International
	 	PCT/AU00/00103	 	National phase entry
	 
	 	 	 	completed

37.exv10w1

 

Exhibit 10.1

LIMITED LIABILITY COMPANY AGREEMENT

OF

INTERNATIONAL AUTOMOTIVE COMPONENTS GROUP NORTH AMERICA, LLC

This Limited Liability Company Agreement (the “Agreement”), as it may be further amended,
dated as of March 31, 2007 (the “Effective Date”), is by and among International Automotive
Components Group North America, LLC, a Delaware limited liability company (the “Company”),
and the Stockholders identified on Schedule 1, and provides the terms under which the Company was
organized and will operate.

NOW, THEREFORE, in consideration of the mutual covenants contained herein and other good
and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto, intending to be legally bound, hereby agree as follows:

I. ORGANIZATIONAL MATTERS

     1.1 Formation/Purpose. (a) The formation of the Company, a single employer separate and
apart from any other entity, without limitation, as a Delaware limited liability company under the
Delaware Limited Liability Company Act of 1992, as amended (the “Act”), and all actions
taken by the Person who executed and filed its certificate of formation are hereby adopted and
ratified, such Person being an “authorized person” within the meaning of the Act.

          (b) The Company is organized to (i) be a holding company for various automotive interiors
systems components businesses, including the Lear North American ISD Business, and (ii) engage in
all such other lawful transactions and business activities as may be determined by the Board,
subject to Section 3.4(c).

     1.2 Governance as if a Delaware Corporation. The rights of the members of the Company (which
are referred to herein as “Stockholders”) will be governed by the applicable Constituent
Documents, which will be interpreted as if the Company were a corporation incorporated under the
Delaware General Corporation Law (the “DGCL”) and its members were stockholders of such
corporation. Notwithstanding the foregoing:

          (a) Except as required by the Act, neither the Charter, any amendments thereto nor any other
organizational instrument (other than the Certificate of Formation) will be required to be filed
with the Secretary of State of the State of Delaware as required under Sections 101, 103, 241 or
242 of the DGCL (any such document which would otherwise be so required to be filed with the
Secretary of State of the State of Delaware will be filed with the Secretary of the Company);

          (b) All taxes and fees otherwise payable by the Company pursuant to Section 391 of the DGCL
will be determined under and payable solely in accordance with the Act; and

 

 

          (c) Notwithstanding any other provision hereof, neither the Company nor any other Person will
be subject to the provisions of DGCL Sections 145, 154, 160(a), 170, 172, 173, 174, 203, 220 or
282.

     1.3 Liability to Third Parties. Except as otherwise set forth in this Agreement or the other
Constituent Documents, the debts, obligations and liabilities of the Company, whether arising in
contract, tort or otherwise, will be solely its debts, obligations and liabilities and none of the
direct or indirect equity holders, directors or Affiliates of the Company (the “Company
Persons”) will be personally obligated for any such debt, obligation or liability. Except as
set forth in this Agreement or the other Constituent Documents, no Company Person will be (i)
liable for any debts, obligations or liabilities, whether arising in contract, tort or otherwise,
of the Company or any other Company Person or (ii) required to loan or contribute any funds to the
Company.

     1.4 Powers. The Company will possess and may exercise all of the powers and privileges
granted by the Act, the DGCL (as if the Company were a corporation), any other law or this
Agreement, together with any powers incidental thereto, so far as such powers and privileges are
necessary or convenient to the conduct, promotion or attainment of its permitted business purposes
or activities. Without limiting the generality or effect of any other provision hereof, the
Company will have the power to effect the acquisition of any business or take any other action
consistent with the DGCL. As to any third person or entity, the signature of any officer of the
Company on any document will be conclusive evidence of the authority of such officer to execute
such document for and on behalf and in the name of the Company.

     1.5 Fiduciary Duties. No director of the Company shall be personally liable to the Company or
any of its Stockholders for monetary damages for breach of fiduciary duty as a director, provided
that the foregoing provision shall not eliminate or limit the liability of a director (i) for
breach of such director’s duty of loyalty to the Company or its Stockholders, (ii) for acts or
omissions not in good faith or which involve intentional misconduct or a knowing violation of law,
or (iii) for any transaction from which such director derived an improper personal benefit.

II. CAPITALIZATION

     2.1 Capitalization. The capitalization of the Company is as set forth in the Charter.
Subject to Sections 3.2 and 3.4(c), the Board has the authority to issue additional Capital Stock,
which may include different classes of equity.

     2.2 Stockholders. (a) As of the Effective Date, and as a condition to the closing of the
Lear Acquisition Agreement, the Stockholders will make the following capital contributions to the
Company: (i) Lear NAOC will contribute $27,066,667 in cash in exchange for twenty-five percent
(25%) of the Capital Stock and $300,000 in exchange for the Lear Warrant, (ii) WLR will contribute
$54,133,334 in cash in exchange for fifty percent (50%) of the Capital Stock, and (iii) Franklin
will contribute $27,066,667 in cash in exchange for twenty-five percent (25%) of the Capital Stock.
As of the Effective Date, after giving effect to such capital contributions, the name and

2

 

address of each of the Stockholders and the number of shares of Capital Stock and percentage
holding of each of them respectively is as set forth on Schedule 1, and, as of the
Effective Date, no other parties shall own or have rights to acquire any Capital Stock of the
Company.

          (b) Subject to Sections 3.2 and 3.4(c), the Company is authorized to issue Capital Stock in
exchange for either capital contributions, or the provision of services (together, “Capital
Stock Consideration”), having a Fair Market Value equal to the value of the Capital Stock
issued as determined in good faith by the Board. The amount of Capital Stock held by each
Stockholder shall not be affected by either (i) any issuance by the Company of Capital Stock to
other Stockholders, (ii) any change in the Capital Account of such Stockholder (other than such
changes to reflect additional Capital Stock Consideration from such Stockholder in exchange for new
Capital Stock) or (iii) any distributions not in redemption of Capital Stock. The shares of
Capital Stock shall be certificated and the Board shall maintain, or cause to be maintained, a
Capital Stock ledger. No Stockholder shall be required to make any additional capital
contributions to the Company.

          (c) Except as otherwise provided in this Agreement, no Person other than the parties set forth
on Schedule 1 will be a Stockholder of the Company, and no Capital Stock of the Company will be
issued or transferred, without compliance with the terms and provisions of the Company’s
Constituent Documents and the execution by any such Person of a joinder to this Agreement whereby
such Person agrees to be bound by this Agreement and the Company’s other Constituent Documents.

          (d) WLR is the “Majority Stockholder”; provided that once WLR ceases to own 10% or
more of the Common Stock of the Company, it will no longer be the Majority Stockholder for any
purpose hereunder.

          (e) Franklin and Lear NAOC are the “Minority Stockholders”; provided that upon the
earlier of (i) a Minority Stockholder ceasing to own 5% or more of the Common Stock of the Company
or (ii) a Minority Stockholder selling or transferring more than 20% of the Common Stock it held as
of the Effective Date other than to a Permitted Transferee or in connection with a pledge (or
exercise pursuant thereto), it will no longer be a Minority Stockholder for any purpose hereunder;
provided however, that in no event shall Lear NAOC cease to be a Minority Stockholder under clause
(i) prior to the date that is eighteen months after the Effective Date.

          (f) For purposes of the Act, the Stockholders are the members of the Company.

     2.3 2007 EBITDA. The Company shall deliver to the Stockholders, no later than 15 days after
the Company’s receipt of its audited consolidated financial statements for the year ending December
31, 2007, the Company’s calculation of 2007 EBITDA (the “Company Calculation”).

3

 

          (a) The Company Calculation shall be prepared in good faith, based on the Company’s books and
records and, for consolidated net income and the items in subsections (i) (ii), (iii), (iv), (vii),
(viii), (ix) and (xii) in the definition of 2007 EBITDA, in accordance with U.S. generally accepted
accounting principles.

          (b) If Lear NAOC disagrees with the Company Calculation, Lear NAOC shall provide written
notice (a “Dispute Notice”) to the Company and the other Stockholders of its objection(s)
to such calculation. If Lear NAOC does not provide a Dispute Notice within 45 days after the
Company’s delivery of the Company Calculation, the 2007 EBITDA set forth therein shall be deemed
the finally determined 2007 EBITDA. If Lear NAOC delivers a Dispute Notice, the Company and Lear
NAOC will use good faith efforts during the 30-day period after the delivery of such Dispute Notice
(the “Resolution Period”) to seek to resolve the differences set forth therein. If the
Company and Lear NAOC cannot reach written agreement during the Resolution Period, their
disagreements, limited to those issues still in dispute, will be submitted by the parties for
determination by the Accounting Firm.

          (c) During the period beginning on the date of the delivery of the Company Calculation and
ending upon the final determination of 2007 EBITDA (including the Resolution Period, if necessary),
the parties will provide to each other such reasonable access to personnel involved in the Company
Calculation and to financial and other information of the Company as it may request in good faith
to determine 2007 EBITDA.

          (d) The Company and the Stockholders shall use their reasonable best efforts to cause the
Accounting Firm to submit its written statement of its adjudication of the disputes regarding 2007
EBITDA within 30 days after submission of the matter to the Accounting Firm. The determination of
the Accounting Firm shall constitute an arbitral award that is final, binding and unappealable and
upon which a judgment may be entered by any court having jurisdiction thereof. In acting
hereunder, the Accounting Firm shall be entitled to the privileges and immunities of arbitrators.

          (e) If the finally determined 2007 EBITDA is less than $41,666,666.67, the Stockholders will
contribute to the Company an amount (the “Shortfall Amount”) in cash equal to the lesser of
(i) three times the amount by which 2007 EBITDA is less than $41,666,666.67 and (ii) $60 million.
Each of the Stockholders will contribute to the Company an amount equal to the product of (x) its
respective Company Common Stock Percentage Interests, multiplied by (y) the total aggregate
additional capital contribution required of all the Stockholders.

          (f) The amount of any additional capital contribution required hereunder shall be payable
solely by a release of the Escrowed Funds (together with any income earned on such released funds)
or from a drawdown on a Letter of Credit posted in lieu of depositing funds in escrow.

          (g) If the finally determined 2007 EBITDA is equal to or greater than $41,666,666.67, each of
the Stockholders will be entitled to the return of its entire

4

 

escrow deposit (plus any income thereon) under the Escrow Agreement. Similarly, each
Stockholder shall be entitled to have returned promptly from the escrow account the amount by which
such Stockholder’s total Escrowed Funds exceeds such Stockholder’s additional capital contribution
required pursuant to subsection (e) above (together with any income earned on such released funds).

          (h) Within three Business Days after the final determination of 2007 EBITDA, the Company and
the Stockholders will provide the escrow agent under the Escrow Agreement with joint written
instructions to disburse the funds held in escrow thereunder in accordance with the terms of this
Agreement and the Escrow Agreement.

          (i) The Company and the Stockholders agree that no additional shares of Capital Stock will be
issued in respect of additional capital contributions pursuant to this Section 2.3(e), except to
prevent dilution vis-à-vis a third party Stockholder who has purchased shares of Capital Stock or
Options between the Effective Date and the date of such capital contribution; provided that the
Stockholders’ percentage of ownership of the Company relative to each other shall stay
substantially the same following such capital contribution.

          (j) The Company and Stockholders agree that any amounts paid pursuant to Section 2.3(e) shall
for purposes of the Code be accorded treatment as a capital contribution pursuant to Section 721 of
the Code and none of the parties will take any action or position inconsistent with such treatment
under the Code.

     2.4 Escrowed Funds; Letter of Credit. As of the Effective Date, each of Lear NAOC, WL Ross
and Franklin has (a) executed and delivered the Escrow Agreement and (b) delivered to the escrow
agent under the Escrow Agreement its respective portion of the Escrowed Funds to be deposited into
the escrow account established pursuant to the Escrow Agreement by delivery to such escrow agent of
cash or an irrevocable letter of credit in a form reasonably acceptable to Lear NAOC, in the case
of a Letter of Credit for the account of WL Ross or Franklin, and to WL Ross and Franklin, in the
case of a Letter of Credit for the account of Lear NAOC (each a “Letter of Credit” and
collectively, the “Letters of Credit”). The Escrowed Funds (including the Letters of
Credit) shall be used solely as contemplated by Section 2.3.

III. GOVERNANCE

     3.1 Charter and Bylaws. Except as provided in this Agreement, the Company will be governed by
the Charter and Bylaws.

     3.2 Preemptive Rights. After the Effective Date, the Company will not issue, sell or
exchange, agree to issue, sell or exchange, or reserve or set aside for issuance, sale or exchange,
any Capital Stock or Options (collectively, the “Preemptive Securities”), unless the
Company has first offered to sell to each of the Stockholders such Stockholder’s Pro Rata Share (as
defined below) of the Preemptive Securities, at a price and on such other terms as have been
specified by the Company in writing delivered to each such Stockholder (the “Preemptive
Offer”), which Preemptive Offer

5

 

will be on terms substantially identical to the terms of the Company’s proposed issuance, sale
or exchange of Preemptive Securities and will remain open and irrevocable for a period of 20
Business Days from the date it is delivered by the Company (the “Preemptive Offer Period”).
Notwithstanding the foregoing, Preemptive Securities will not include (a) Options or other equity
securities or rights issued pursuant to an Employee Plan approved by the Board (subject to Section
3.4(b)(ii)) and any Capital Stock issued upon the exercise of any such Options or other equity
securities so long as such Options issued or the equity securities issuable upon exercise of such
Options do not represent in excess of 10% of the fully diluted Common Stock, (b) the Lear Warrant
or any equity securities issued pursuant to the terms of the Lear Warrant, (c) equity securities
issued by the Company as direct consideration in connection with the acquisition of another
business entity by the Company or a Subsidiary, whether by merger, purchase of all or substantially
all of the assets of such entity or otherwise, (d) securities issued as a result of any split of,
reclassification, subdivision of or other distribution pro rata with respect to, the equity
securities of the Company, or (e) any equity securities issued in a Public Offering or pursuant to
the Reorganization. Each Stockholder may elect to purchase (or to have its designated Affiliate
that is also, or simultaneously with such purchase becomes, a Stockholder, purchase) all or any
portion of such Stockholder’s Pro Rata Share of the Preemptive Securities as specified in the
Preemptive Offer at the price and on the terms specified therein by delivering written notice of
such election to the Company as soon as practicable but in any event before the expiration of the
Preemptive Offer Period. Any Preemptive Securities not elected to be purchased by the end of the
Preemptive Offer Period will be reoffered for a five-day period by the Company on a pro rata basis
to the Stockholders who have elected to purchase their full Pro Rata Share of the Preemptive
Securities. In the event the Stockholders fail to exercise in full their preemptive rights as set
forth above with respect to the Preemptive Securities, the Company shall have 60 days thereafter to
sell such Preemptive Securities, at a cash or cash equivalent price that is not less than the price
specified in the Preemptive Offer. In the event the Company has not sold the Preemptive Securities
within such 60-day period, the Company shall not thereafter issue or sell any Preemptive Securities
without first complying with the first offer rights set forth in this Section 3.2. Each
Stockholder’s “Pro Rata Share” of Preemptive Securities is the product of (x) the total
number of Preemptive Securities and (y) a fraction, the numerator of which is the total number of
shares or units of Common Stock then owned by such Stockholder and the denominator of which is the
total number of shares or units of Common Stock then outstanding.

     3.3 Board Composition and Representation. (a) The number of directors comprising the Board
will not exceed five. Subject to Section 3.3(b) and Section 3.3(c), the directors comprising the
Board will consist of (i) two (or, in the circumstances described in Section 3.3(b), three)
representatives designated by WLR (as long as WLR is the Majority Stockholder), one of whom will be
the Chairman of the Board, (ii) one representative designated by Franklin (as long as Franklin is a
Minority Stockholder), and (iii) (if Lear NAOC so elects) one representative designated by Lear
NAOC (as long as Lear NAOC is a Minority Stockholder). The composition of the Board as of the
Effective Date will be as specified on Schedule 2. Lear NAOC may elect to designate a
director by providing written notice to the Company to that effect identifying its designee.

6

 

Such designee shall become a director on the earlier to occur of (i) the third Business Day
after delivery of such notice and (ii) the day on which WLR designates its third director. Each
Stockholder agrees to vote or cause its shares of Common Stock to be voted at any meeting of the
Stockholders and any and all postponements and adjournments thereof or in any other circumstances
in which a vote, consent or other approval (including by written consent) is sought to elect or
remove the directors designated pursuant to this Section 3.3 to serve on the Board and any other
similar matter.

          (b) If and for so long as Lear NAOC exercises its right to designate a director, WLR shall be
entitled to designate a total of three representatives to the Board pursuant to Section 3.3(a).

          (c) If WLR ceases to be the Majority Stockholder or Franklin or Lear NAOC ceases to be a
Minority Stockholder, the director(s) that the Stockholder that is no longer the Majority
Stockholder or a Minority Stockholder, as applicable, had been entitled to designate will be
designated by a Majority in Interest.

          (d) Directors may be removed at any time with or without cause. A director may only be
removed by the affirmative vote of the Stockholder(s) entitled to designate such director. In the
event that a vacancy in the Board is created at any time by the death, disability, retirement,
resignation or removal (with or without cause) of any director, such vacancy may be filled only by
the Stockholder(s) entitled to designate such director pursuant to this Section 3.3.

          (e) The composition of each Subsidiary Board for a wholly-owned Subsidiary that is
incorporated or formed in the United States of America shall be the same as that of the Board.

          (f) Directors appointed to the Board will be compensated in accordance with the Bylaws.

          (g) The Company and the Stockholders will take all action necessary to cause the Subsidiaries
of the Company to implement and not contradict the actions and resolutions of the Board.

          (h) If and for so long as Lear NAOC does not exercise its right to designate a Board director
pursuant to Section 3.3(a), it will be entitled to designate one representative to attend meetings
of the Board, any board of directors (or equivalent governing body) of any controlled Subsidiary
(each, a “Subsidiary Board”) or any committee thereof in a non-voting observer category
(the “Observer”). The Observer will have no voting rights with respect to any decision of
the Board, or any committee of the Board. The Company will provide written notice to the Observer
of each meeting of the Board or Subsidiary Board or any committee thereof at the same time and in
the same manner as notice is given to the members of the Board or Subsidiary Board and will furnish
to the Observer copies of all written materials and other information (including copies of meeting
minutes) at the same time as given to directors at, in

7

 

advance of, or subsequent to such meetings. Lear NAOC’s right to designate an Observer will
terminate if it ceases to be a Minority Stockholder.

          (i) Lear NAOC and Franklin will each be entitled to designate one representative to attend
meetings of any board of directors (or equivalent governing body) of any controlled foreign
Subsidiary (each a “Foreign Subsidiary Board”) or any committee thereof in a non-voting
observer category (the “Foreign Subsidiary Observer”). The Foreign Subsidiary Observer
will have no voting rights with respect to any decision of the Foreign Subsidiary Board or any
committee of the Foreign Subsidiary Board. The Company will assure that there is provided to each
Foreign Subsidiary Observer written notice of each meeting of the Foreign Subsidiary Board at the
same time and in the same manner as notice is given to the members of the Foreign Subsidiary Board
and will furnish to each Foreign Subsidiary Observer copies of all written materials and other
information (including copies of meeting minutes) at the same time as given to directors at, in
advance of, or subsequent to such meetings. Lear NAOC’s right and Franklin’s right to designate a
Foreign Subsidiary Observer will terminate if it ceases to be a Minority Stockholder.

          (j) The Company shall pay all out-of-pocket expenses incurred by each director and any
permitted Observer or Subsidiary Observer in connection with attending any meetings of the Board,
any Subsidiary Board or any committee thereof. In the event that the Company pays any fee to a
director for serving on the Board, any Subsidiary Board or any committee thereof, the Company shall
pay to each director a fee in an amount equal to the amount paid to such other director. So long
as any director appointed by WLR, Lear NAOC or Franklin serves on the Board and for three years
thereafter, the Company shall maintain directors and officers indemnity insurance coverage
reasonably satisfactory to such Stockholder and the Charter and Bylaws shall provide for
indemnification and exculpation of directors to the fullest extent permitted under applicable law.

     3.4 Management; Officers. (a) The Board will be responsible for and will have authority to
generally oversee the management of the Company. The initial officers of the Company will be as
specified on Schedule 2. Unless otherwise determined by the Board, the authority of the
officers of the Company and the Subsidiaries will be as is customary for officers of a Delaware
corporation, including, but not limited to, the right and obligation to manage all labor relations
and personnel affairs of the Company in a manner consistent with the Company’s status as a single
employer separate and apart from any other entity, without limitation.

          (b) The Company will not take, and the Company will cause the Board and officers of each
Subsidiary to not take, any of the following actions without the Required Board Approval:

     (i) incur debt for borrowed money in the aggregate in excess of $75.0 million;

8

 

     (ii) create any employee option, incentive or similar plan pursuant to which
Company equity securities may be issued (“Employee Plans”);

     (iii) enter into any material contracts or arrangements outside the ordinary
course of the Company’s and the Subsidiaries’ business, excluding any acquisition of
any business by the Company or any Subsidiary, whether by merger, purchase of all or
substantially all of the assets of such business or otherwise;

     (iv) consummate a Reorganization or a Public Offering;

     (v) enter into or modify any agreement or enter into any transaction between
the Company or a Subsidiary and a Stockholder or any of its Affiliates other than in
relation to any issuance of shares of Capital Stock at Fair Market Value that
complies with Section 3.2;

     (vi) make any amendment to this Agreement or, except as contemplated in Section
6.1 in connection with a Reorganization, to the Company’s Constituent Documents;

     (vii) enter into an agreement pursuant to which it will sell or otherwise
transfer all or substantially all of the Company’s and the Subsidiaries’ assets,
whether by sale or transfer of assets, sale of equity, merger or a transaction of a
similar nature (a “Sale Transaction”); or

     (viii) approve the dissolution, winding-up, liquidation or bankruptcy of the
Company or a material Subsidiary.

          (c) The Company will not take, and the Company will cause the Board and officers of each
Subsidiary to not take, any of the following actions without the approval of each Minority
Stockholder:

     (i) consummate a Sale Transaction in which all Stockholders holding the same
class of Capital Stock do not receive the same consideration on the same terms,
determined on the same basis;

     (ii) approve the dissolution, winding-up, liquidation or bankruptcy of the
Company or a material Subsidiary;

     (iii) enter into or modify any agreement or enter into any transaction between
the Company or a Subsidiary and a Stockholder or any of its Affiliates other than on
arms length terms; provided, that with respect to any such transaction (or series of
related transactions) that involves aggregate payments or other property with a fair
market value in excess of $5 million, the Company shall, prior to the consummation
thereof, obtain a favorable opinion as to the fairness of such transaction or series
of related transactions to the Company or the relevant Subsidiary,

9

 

as the case may be, from a financial point of view, from an Arbiter experienced
in the subject matter of such transaction or transactions; provided however, that if
Lear NAOC ceases to be a Minority Stockholder, neither the Company nor a Subsidiary
shall enter into or modify any agreement or enter into any transaction between the
Company or a Subsidiary and a Stockholder or any of its Affiliates, without the
approval of Franklin;

     (iv) launch or acquire a new line or lines of business which is or are (a)
individually or in the aggregate reasonably likely to represent 20% or more of the
Company’s and Subsidiaries’ consolidated annual sales in the twelve months following
its launch or acquisition (as applicable), and (b) is significantly different from
the business conducted by the Company and the Subsidiaries as of the Effective Date
(after giving effect to the Lear ISD Closing);

     (v) issue any shares of Capital Stock at less than Fair Market Value;

     (vi) issue any shares of Capital Stock other than Common Stock to any
Stockholder or Affiliate of any Stockholder;

     (vii) consummate any recapitalization or reorganization of the Company’s
Capital Stock in which all Stockholders holding the same class of Capital Stock do
not receive the same consideration, on the same terms, determined on the same basis;

     (viii) effect any redemption or repurchase of any Capital Stock or make or pay
any dividends or other distributions other than on a pro rata basis as among
Stockholders holding the same class of Capital Stock;

     (ix) make any amendment to this Agreement or, except as contemplated in Section
6.1 in connection with a Reorganization, to the Company’s Constituent Documents; or

     (x) enter into any Change of Control or Restructuring transaction between the
Company or a Subsidiary and a Stockholder or any of its Affiliates other than on
arms length terms, provided that any such transaction (or series of related
transactions) shall be deemed to be on arms length terms if the Company, prior to
the consummation thereof, obtains an opinion as to the appropriate value(s) to be
ascribed to the elements of such transaction and a favorable opinion as to the
fairness to each of the Stockholders, Company or the relevant Subsidiary, as the
case may be, from a financial point of view, from an Arbiter experienced in the
subject matter of such transaction or transactions. The Company shall nominate a
party to serve as the Arbiter and shall disclose to the Minority Stockholders all
relationships between the Company or the Majority

10

 

Stockholder and such nominee during the preceding three years in a written
notice (the “Arbiter Notice”). No later than 15 days after a Minority Stockholder’s
receipt of the Arbiter Notice, such Minority Stockholder shall notify the Company in
writing whether it consents to the use of such nominee, which consent shall not be
unreasonably withheld. If a Minority Stockholder does not so notify the Company as
to its consent within 15 days after its receipt of the Arbiter Notice, it will be
deemed to have consented to the nominee set forth therein. If a Minority
Stockholder does not consent to the use of such nominee, it shall provide the
Company and the other Stockholders with a written statement of its reasons for such
failure to consent and the Company shall then select another Arbiter and the parties
shall comply with the foregoing provisions of this Section 3.4(c)(x) until such time
as an Arbiter has been selected. Notwithstanding anything contained herein to the
contrary or in the Act or in the DGCL, if the Company complies with the provisions
of this Section 3.4(c)(x), the Minority Stockholders shall be foreclosed from
alleging that the Company, any Stockholder or any officer or director of the Company
has breached or violated any fiduciary duty owed by such Person to the Company or
any Stockholder with respect to the valuation of the proposed transaction and waives
any and all rights it or any of its Affiliates may have relating to the valuation of
such transaction.

          (d) No vote or other action of the Stockholders is required to authorize the Company to take
or refrain from taking any action, other than as provided for in Section 3.4.

     3.5 Competitive Activities. The Company Persons, directly or through Affiliated entities, are
or may be engaged in businesses that may be competitive with the business of the Company or
companies it owns or in which it invests. Nothing herein, in the Act, the DGCL, any Constituent
Document or otherwise (collectively, the “Applicable Rules”) will be deemed to restrict any
Company Person from engaging in such other business activity (regardless of the effects thereof on
the Company or companies it owns or in which it invests) and, notwithstanding any Applicable Rule
to the contrary, in no event will any Company Person have any obligation to act or refrain from
acting (including without limitation presenting any opportunity or other matter to the Company for
it to consider or pursue or to maintain the confidentiality of, or not use, any confidential or
proprietary information) by reason of any relationship with, or actual or alleged duty to, the
Company, provided, however, that this Section 3.5 will not limit the scope or applicability of
Section 6.5, or any other written contract between a Company Person and the Company or any other
Company Person. The Company and the other Company Persons will have no rights by virtue of this
Agreement in and to such independent ventures of any Company Person or the income or profits
derived therefrom, and the pursuit of any such venture, even if competitive with the Company’s
business, will not be deemed wrongful or improper. Each party hereto agrees that, in any such
case, to the extent a court might otherwise hold that the conduct of such activity is a breach of
any Applicable Rule, it has hereby irrevocably waived any and all rights of recovery it may
otherwise have by reason thereof.

11

 

     3.6 Management of Workforce and Business. From and after the Effective Date, and
notwithstanding any other provision of this Agreement, the management and direction of the
Company’s and its Subsidiaries’ workforce and business, and the terms and conditions thereof,
including all wage and salary programs (including bonuses, and incentive compensation), medical and
other benefit programs, other compensation and benefit programs and the establishment of
procedures, policies and protocols for hiring, disciplining and firing employees and setting
general employee standards shall be determined by the Board of Directors (as delegated to the
officers of the Company and its Subsidiaries).

IV. TRANSFERS

     4.1 Transfers. (a) Except for Transfers that comply with this Article IV, without the
Required Board Approval (which, for purposes of clarification, shall not in any event prejudice the
rights of any other Stockholder under Section 4.2 or 4.3), no Stockholder may, directly or
indirectly, sell, transfer, gift, assign or otherwise dispose of, or permit, voluntarily or
involuntarily or by operation of law, any security, encumbrance, interest, pledge, mortgage, lien,
charge, adverse claim, option, warrant, grant of voting rights, preferential arrangement or
restriction of any kind (collectively, an “Encumbrance”) upon, all or any portion of such
Stockholder’s Capital Stock, Options or any interest therein or make or support an application
being made for entry of a decree under Section 18-802 of the Act or enter into an agreement to do
or permit any of the foregoing actions. Notwithstanding the foregoing, Lear NAOC shall be
permitted to pledge its Capital Stock and the Lear Warrant as collateral to secure indebtedness to
a bank or trustee incorporated and doing business in the United States having a combined capital
and surplus of at least $1 billion upon 45 days prior written notice (a “Pledge Notice”) to
the Company, WLR (as long as WLR is a Majority Stockholder) and Franklin (as long as Franklin is a
Minority Stockholder). In no event may a Stockholder Transfer Capital Stock or Options to any
Person who, in the reasonable opinion of the Board, is engaged (whether directly or through
Affiliated entities) in any material business that is competitive with the Business. The Board
shall notify any Stockholder within 20 Business Days of receipt of notice of any proposed
Stockholder Transfer of Capital Stock or Options whether or not the Board, in its reasonable
discretion, deems such transfer to be a prohibited transfer to a competitor in accordance with the
foregoing sentence. Notwithstanding the foregoing, nothing in this Agreement shall restrict a
Change in Control transaction with respect to Lear Corporation or any resulting Transfer as a
result thereof. Any purported sale, transfer, gift, assignment or other disposition or Encumbrance
of a Stockholder’s Capital Stock or Options (hereinafter collectively referred to as a
“Transfer”) which is in violation of this Agreement (a “Prohibited Transfer”) shall
be invalid and void, shall not bind the Company and shall have no effect whatsoever on the Company
or its Stockholders. Any Stockholder which engages in any Prohibited Transfer shall be liable to
the Company for all costs and expenses incurred by the Company as a result thereof or related
thereto, including with respect to legal action required to enforce the terms of this Agreement.

          (b) Notwithstanding the foregoing, the prohibitions in Section 4.1(a) shall not apply to: (i)
the Transfer by any Stockholder of Capital Stock or Options to the

12

 

Permitted Transferees of such Stockholder and (ii) the Transfer by any Stockholder of Capital
Stock or Options to a third party, provided that such Stockholder complies with Section 4.2 and
4.3, if applicable.

          (c) Any Transfer of Capital Stock or Options which is not prohibited by Section 4.1(a) or
4.1(e) shall be effective only if (i) such Transfer is in compliance with all applicable federal,
state and foreign securities laws and (ii) the Transferee has agreed in writing to be bound by the
terms and conditions of this Agreement.

          (d) If shares of Capital Stock or Options are certificated, each certificate representing the
Capital Stock or Options shall be stamped or otherwise imprinted with a legend or legends customary
in form reflecting the restrictions on transfer set forth in this Agreement and under applicable
securities laws.

          (e) Notwithstanding anything to the contrary in this Agreement, in no event may a Transfer by
any Stockholder be made if the Board concludes in good faith that such Transfer is reasonably
likely to result in (i) the Company being in violation of any applicable law or (ii) the
dissolution of the Company. In making the determination whether a Transfer is reasonably likely to
result in such a termination or dissolution or is reasonably likely to cause such violation, the
Board, in its sole discretion, may require the assignee to furnish, at such assignee’s expense, an
opinion of counsel passing on this issue in a form reasonably acceptable to the Board, with such
counsel to be reasonably acceptable to the Board.

     4.2 Right of First Refusal. (a) Except as otherwise provided herein, if at any time any
Stockholder proposes to Transfer any Capital Stock or Options in any manner to one or more third
parties (other than to Permitted Transferees), then such Stockholder (the “Transferring
Stockholder”) shall give all other Stockholders (the “Offeree Stockholders”) written
notice of its intention to make the Transfer (the “Transfer Notice”), which Transfer Notice
must include (i) a description and the number of shares of Capital Stock to be transferred and a
description of the Options, if any, to be transferred and the number of shares of Capital Stock for
which such Options are exercisable (“collectively, Offered Securities”), (ii) the identity
of the prospective transferee(s) (the “Proposed Transferee”), (iii) the consideration, if
any (the “Offered Price”), and the material terms and conditions upon which the proposed
Transfer is to be made (the “Offered Terms”), and (iv) an offer to sell the Offered
Securities to the Offeree Stockholders at the Offered Price and on the Offered Terms. The Transfer
Notice must certify that the Transferring Stockholder has received a bona fide offer from the
Proposed Transferee(s) and in good faith believes a binding agreement for the Transfer is
obtainable on the terms set forth in the Transfer Notice. The Transfer Notice must also include a
copy of any written proposal, term sheet, or letter of intent or other agreement relating to the
proposed Transfer. Upon the request of the Company or any Offeree Stockholder, the Transferring
Stockholder shall promptly furnish to the Company or to such Offeree Stockholder such other
information as may reasonably be requested to establish that the offer from the Proposed
Transferee(s) is bona fide. If the Offered Price includes consideration other than cash or if
there is no consideration, the cash-equivalent value of the non-cash consideration or the Fair
Market Value of the

13

 

Offered Securities, as the case may be, will be determined by the Board in good faith pursuant
to the Required Board Approval.

          (b) Offeree Stockholders’ Option. The Offeree Stockholders will have an option for a
period of 20 Business Days from receipt of the Transfer Notice (the “Holder Option Period”)
to elect to purchase all (but not less than all) of such Offeree Stockholder’s pro rata portion,
calculated relative to the Capital Stock held by all Offeree Stockholders electing to purchase
Offered Securities, at the same price and subject to the same material terms and conditions as
described in the Transfer Notice (the “Holders’ Purchase Option”). Each Offeree
Stockholder may exercise the Holders’ Purchase Option by so notifying the Transferring Stockholder
in writing before expiration of the Holder Option Period. If one or more Offeree Stockholders
gives the Transferring Stockholder notice that they desire to purchase Offered Securities, payment
for such Offered Securities shall be in cash by certified check or wire transfer, against delivery
of certificates representing such Offered Securities, at a place agreed upon between the parties
and at the time of the scheduled closing therefor, which shall be no later than 30 Business Days
after the Offeree Stockholders’ receipt of the Transfer Notice. Any Offered Securities not elected
to be purchased by the end of the Holder Option Period will be re-offered for a five-day period by
the Transferring Stockholder to the Offeree Stockholders who have elected to purchase their full
pro-rata portion of the Offered Securities; if such Offeree Stockholders collectively subscribe for
more than the available Offered Securities, such Offered Securities will be allocated on a pro-rata
basis.

          (c) Transferring Stockholder’s Right to Transfer. If the Offeree Stockholders do not
exercise the Holders’ Purchase Option with respect to all of the Offered Securities, then all
elections to purchase such Offered Securities shall be null and void and the Transferring
Stockholder may Transfer the Offered Securities to the Proposed Transferee at the Offered Price or
at a higher price as long as such Transfer is consummated within 75 days after the date of the
Transfer Notice. If the Offered Shares are not transferred to the Proposed Transferee within such
period, a new Transfer Notice must be given before the Transferring Stockholder may Transfer any
Capital Stock or Options.

     4.3 Tag-Along Rights. (a) If one or more Stockholders other than Lear NAOC (“Selling
Stockholder”) proposes to sell Capital Stock to a third party purchaser (the “Prospective
Purchaser”) pursuant to a bona fide offer to purchase such Capital Stock (a “Qualified
Offer”), such Selling Stockholders may engage in such transaction, subject to their prior
compliance with Section 4.2, only if they assure that the other Stockholders or holders of Options
(“Tag-Along Stockholders”) also shall be afforded the right to sell a proportionate share
of their Capital Stock or Options to the Prospective Purchaser simultaneously therewith on terms
and conditions at least as favorable to the Selling Stockholders as the terms and conditions set
out in the Qualified Offer. Upon receipt by one or more Selling Stockholders of a Qualified Offer,
the Selling Stockholders shall notify the Tag-Along Stockholders in writing of such offer and its
terms and conditions (the “Offer Notice”), which written notice shall include the name of
the Prospective Purchaser and the consideration offered in connection therewith. In

14

 

order to exercise their right to sell their Capital Stock or Options as set forth above, the
Tag-Along Stockholders must provide written notice of such intention to the Selling Stockholders
within 20 days after the date of their receipt of the Offer Notice. If the Tag-Along Stockholders
do not provide such written notice within 20 days, the Selling Stockholders may sell their Capital
Stock to the Prospective Purchaser on the terms of the Qualified Offer as long as such sale is
consummated within 75 days after the date of the Offer Notice. If the Capital Stock is not
transferred to the Prospective Purchaser within such period, a new Offer Notice must be given
before the Selling Stockholders may sell any Capital Stock. Each participating Tag-Along
Stockholder individually, not jointly and severally, shall make such Tag-Along Stockholder’s
proportionate share of any representations and warranties made in connection with any such
Transfer. In no event shall any Tag-Along Stockholder be liable for indemnification or similar
obligations in connection with such Transfer other than severally on a pro rata basis in an amount
not greater than the proceeds actually received by such Tag-Along Stockholder in connection with
such Transfer.

          (b) The co-sale rights provided to any Tag-Along Stockholder under Section 4.3(a) shall be
applicable to any direct or indirect sale (including by means of a merger, reorganization, or other
similar transaction) of the Capital Stock of the Company held by a Stockholder, other than Lear
NAOC, including any transfer (including by means of a merger, reorganization, or other similar
transaction) of all or substantially all of the issued and outstanding capital stock, or its
equivalent, of such Stockholder or its Affiliates to a third party; provided that Section 4.3(a)
shall not apply to an indirect transfer of Capital Stock caused by changes in the identity of or
investors in advisory clients of Franklin or funds or other investment vehicles included in the
definition of “WLR” or a transfer of Capital Stock by a Stockholder that is an advisory client of
Franklin or a limited partner or comparable passive investor in a fund or other investment vehicle
included in the definition of “WLR” that receives capital stock pursuant to a normal course
distribution (including a winding up) pursuant to the constituent documents of such fund or other
investment vehicle.

     4.4 Sale of the Company.

          (a) If the Board approves a Sale Transaction in accordance with Section 3.4, each Stockholder
will consent to such Sale Transaction and will vote all of its Capital Stock in favor of such Sale
Transaction, if such vote is required under applicable law, and, if Capital Stock is to be
transferred, will Transfer all of its Capital Stock and Options on the terms and subject to the
terms and conditions of such Sale Transaction. Subject to Section 4.4(b), each Stockholder agrees
to (i) cooperate in any Sale Transaction as reasonably requested by the Board and (ii) execute and
deliver all documents and instruments reasonably requested by the Board, in each case, as are
required in order to effectuate such Sale Transaction.

          (b) The obligations of each Stockholder set forth in Section 4.4(a) in connection with a Sale
Transaction are subject to the satisfaction of the following conditions: (i) upon the consummation
of the Sale Transaction, each Stockholder of the same class shall receive or have the option to
receive the same form of consideration

15

 

and the same amount of per share consideration (with respect to any Options on an as converted
or exercised basis); (ii) if any Stockholder is given an option as to the form and amount of
consideration to be received, each Stockholder of the same class shall be given the same option;
and (iii) (in the case of Lear NAOC only) if the consideration to be received by the Stockholders
for the Capital Stock or Options upon consummation of the Sale Transaction does not consist of cash
or Marketable Securities any securities issued to Lear NAOC as consideration for the Sale
Transaction will be subject to substantially similar liquidity protections (whether granted by the
buyer or another party) as those set forth in this Agreement. Each Stockholder individually, not
jointly or severally, shall make such Stockholder’s proportionate share of any representations and
warranties made in connection with any such Sale Transaction; provided, however, that while Lear
NAOC may be required to provide its proportionate share of indemnification with respect to
representations and warranties regarding the Company, in no event shall Lear NAOC be required to
make any representations and warranties other than with respect to title to the Capital Stock or
Options to be sold by Lear NAOC in connection with such Sale Transaction, its authority to enter
into and perform its obligations in connection with such Sale Transaction, and the lack of any
conflicts resulting from its execution, delivery and performance of the documents and transactions
in connection with such Sale Transaction. In no event shall any Stockholder be liable for
indemnification or similar obligations in connection with such Sale Transaction in an amount
greater than the proceeds actually received by such Stockholder in connection with such Sale
Transaction. Notwithstanding the above, the Board, if requested by Lear NAOC, shall use
commercially reasonable efforts to obtain the agreement of the purchaser in a Sale Transaction to
purchase the Lear Warrant (as adjusted to account for the exercise price thereof) without requiring
the holder thereof to exercise the Lear Warrant in connection with such Sale Transaction.

     4.5 Call Option. If Lear NAOC intends to make a Lear Demand Request, it will first notify the
Company (whether before or after the date on which Lear NAOC has the right to exercise a Demand
Registration Right) and will offer (and/or cause to be offered) to WLR (as long as WLR is a
Majority Stockholder) and Franklin (as long as Franklin is a Minority Stockholder) (the
“Optionholders”) the option (the “Call Option”) to acquire all (but not less than
all) of the shares of Capital Stock and Options held by it (and its Permitted Transferees) at the
Call Price by delivering written notice to that effect (a “Call Notice”) to the Company,
WLR and Franklin. The Call Option may be exercised by the Optionholders only in whole and not in
part. The Optionholders may assign the Call Option to the Company, but only in whole and not in
part.

          (a) Determination of Call Price. Upon delivery of a Call Notice to the Optionholders,
the Optionholders and Lear NAOC shall endeavor in good faith to promptly determine the applicable
Call Price. If the Optionholders and Lear NAOC cannot agree on the applicable Call Price within 10
days after the delivery of the Call Notice, as the case may be, they will, as soon as practicable,
select an Arbiter to determine the applicable Call Price. If the Optionholders and Lear NAOC
cannot agree on an Arbiter within 12 days after delivery of the Call Notice, the Optionholders and
Lear NAOC shall each select an Arbiter and shall each instruct their respective Arbiters to select,
within 15 days after delivery of the Call Notice, a third Arbiter to determine the

16

 

Call Price. The Optionholders and Lear NAOC shall instruct the selected Arbiter to determine
the Call Price within 30 days after delivery of the Call Notice. The determination of the Call
Price by such selected Arbiter shall be final, binding and conclusive, absent manifest error;
provided, that following the determination of the Call Price, Lear NAOC can withdraw its Lear
Demand Request and the Call Option by written notice to the Optionholders within 10 days after the
determination of the Call Price (a “Lear Demand Withdrawal”). Lear NAOC and the Company
shall bear all fees, costs and expenses of the Arbiters engaged pursuant to this Section 4.5 in
proportion to Lear NAOC’s Percentage Interest relative to the Optionholders’ aggregate Percentage
Interest.

          (b) Exercise of Call Option. If after the Call Price is agreed or determined and
absent a Lear Demand Withdrawal, an Optionholder wishes to exercise the Call Option, it will notify
Lear NAOC of its intention to do so within 10 days of the Call Price being agreed or determined and
will specify the number of shares of Capital Stock and/or Options it wishes to acquire. In the
event of competition between the Optionholders, the number of shares of Capital Stock and/or
Options to be acquired by them pursuant to the Call Option shall be calculated on a pro rata basis
(“Proportionate Interests”), relative to the Capital Stock and/or Options held by all
Optionholders wishing to exercise the Call Option (“Accepting Optionholders”).

          (c) Closing of the Call Option. The closing of the Call Option pursuant to this
Section 4.5 (a “Call Option Closing”) shall occur on a Business Day specified by written
notice from the Optionholder holding the greater Proportionate Interest to Lear NAOC no later than
five Business Days prior to the proposed Call Option Closing. The Call Option Closing shall occur
no later than 30 days after the final determination of the Call Price. At the Call Option Closing,
the Accepting Optionholders shall pay, without condition, Lear NAOC the applicable Call Price by
wire transfer in lawful money of the United States of America and in immediately available funds,
and Lear NAOC shall deliver to the Accepting Optionholders an assignment of, and any certificates
evidencing, the Capital Stock and Options being transferred to them respectively.

     4.6 Redemption. Upon the occurrence of a Redemption Event in relation to any Stockholder (the
“Affected Stockholder”), if the Board (excluding any director designated by the Affected
Stockholder) so elects (by written notice (the “Redemption Notice”) to the Affected
Stockholder within 30 days after the Company becomes aware of the Redemption Event), all of the
shares of Capital Stock and Options owned by the Affected Stockholder and any Affiliate of the
Affected Stockholder shall be deemed automatically redeemed by the Company for the Redemption Price
without further action of the Affected Stockholder, subject to the right of Lear NAOC to withdraw
its delivery of a Pledge Notice as set forth below; provided, that if the Board reasonably expects
that a Bankruptcy Decision is likely to occur with respect to a Stockholder, the Board may elect
prior to the occurrence of any such Bankruptcy Decision that the Company shall exercise the
redemption right pursuant to this Section 4.6, effective automatically upon the occurrence of a
Bankruptcy Decision. The Redemption Price of the Capital Stock and Options of any Affected
Stockholder shall be determined as of the date of the Redemption Event, as follows. Upon delivery
of the Redemption Notice to

17

 

the Affected Stockholder, the Company and the Affected Stockholder shall endeavor in good
faith to promptly determine the applicable Redemption Price. If the Company and the Affected
Stockholder cannot agree on the applicable Redemption Price within 15 days after the delivery of
the Redemption Notice, they will, as soon as practicable, select an Arbiter to determine the
applicable Redemption Price. If the Company and the Affected Stockholder cannot agree on an
Arbiter within 20 days after delivery of the Redemption Notice, the Company and the Affected
Stockholder shall each select an Arbiter and shall each instruct their respective Arbiters to
select, within 25 days after delivery of the Redemption Notice, a third Arbiter to determine the
Redemption Price. The Company and the Affected Stockholder shall instruct the selected Arbiter to
determine the Redemption Price within 50 days after delivery of the Redemption Notice. The
determination of the Redemption Price by such selected Arbiter shall be final, binding and
conclusive, absent manifest error. Lear NAOC shall have the right, exercisable within 10 days
after determination of the Redemption Price, to withdraw its delivery of a Pledge Notice, in which
event the Company shall not have the right to redeem Lear NAOC’s Capital Stock and Options pursuant
to this Section 4.6. The Affected Stockholder shall bear a portion of the fees, costs and expenses
of the Arbiters engaged pursuant to this Section 4.6 equal to such Affected Stockholder’s
Percentage Interest. The Company shall bear the balance of such fees, costs and expenses. Payment
for such redemption shall be made no later than 45 days after the later of delivery of the
Redemption Notice and the final determination of the applicable Redemption Price. Each director
designated by the Affected Stockholder shall be excluded from any Board decisions (and from the
definition of “Required Board Approval”) in connection with this Section 4.6 and, if the Affected
Stockholder is a Minority Stockholder, its approval pursuant to Section 3.4(c) shall not be
required in connection with any Company action in connection with this Section 4.6.

V. TAX MATTERS; ALLOCATIONS AND DISTRIBUTIONS

     5.1 Tax Characterization. The Stockholders agree to a partnership characterization under
section 301.7701-3 of the Regulations, and no election inconsistent with such treatment shall be
made unless unanimously approved by the Board.

     5.2 Tax Matters Member. WLR is designated as the tax matters partner of the Company pursuant
to section 6231(a)(7) of the Code (the “Tax Matters Member”) and must take such actions as
are necessary to cause each other Stockholder to become a “notice partner” within the meaning of
section 6223 of the Code. WLR may not take any action contemplated by sections 6223 through 6229
of the Code unless unanimously approved by the Board. Except as provided in Section 5.1 and in
this Section 5.2, upon prior notice to Franklin and Lear NAOC, the Tax Matters Member is authorized
to make all appropriate tax elections to be made by the Company. WLR may notify the Board that WLR
no longer desires to serve as the Tax Matters Member; in such case, the Board will designate
another Stockholder to serve as the Tax Matters Member.

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     5.3 Allocation of Profits and Losses. (a) Except as provided in Section 5.3(b) or 5.4,
Profits and Losses will be allocated among the Stockholders in proportion to the number of shares
of Common Stock held by each of them.

          (b) Allocations Related to Capital Events. Upon the occurrence of a Capital Event,
all items of income, gain, loss and deduction that are attributable to such Capital Event will be
allocated among the Stockholders in a manner such that the Adjusted Capital Account balance of each
Stockholder, immediately after giving effect to such allocation and taking into account all
distributions made, will be, as nearly as possible, equal to such Stockholder’s Target Balance.

     5.4 Special Allocations.

          (a) Notwithstanding any other provision of this Agreement, if there is a net decrease in
Minimum Gain during any taxable year, each Stockholder shall be specially allocated items of
Company income and gain for such year (and, if necessary, for subsequent years) in proportion to,
and to the extent of, an amount equal to such Stockholder’s share of the net decrease in
Partnership Minimum Gain determined in accordance with Regulations Section 1.704-2(g)(2). The items
to be so allocated shall be determined in accordance with Treasury Regulation Section
1.704-2(j)(2)(i). This Section 5.4(a) is intended to comply with the minimum gain chargeback
requirement in the Regulations and shall be interpreted consistently therewith

          (b) Nonrecourse deductions for any taxable year shall be allocated to the Stockholders in
proportion to the number of shares of Common Stock held by each of them. For purposes of this
Section 5.4(b), “nonrecourse deductions” shall have the meaning set forth in Section 1.704-2(b)(1)
of the Regulations.

          (c) Notwithstanding any other provision of this Agreement, if there is a net decrease in
Stockholder Minimum Gain attributable to Stockholder Nonrecourse Debt during any taxable year, each
Stockholder who has a share of the Stockholder Minimum Gain attributable to such Stockholder
Nonrecourse Debt shall be specially allocated items of Company income and gain for such year (and,
if necessary, subsequent Company taxable years) equal to such Stockholder’s share of the net
decrease in Stockholder Minimum Gain. The items to be so allocated shall be determined in
accordance with Treasury Regulation Section 1.704-2(j)(2)(ii). Any Stockholder’s share of the net
decrease in Stockholder Minimum Gain shall be determined in accordance with Regulation Section
1.704-2(i)(5). This Section 5.4(c) is intended to comply with the partner minimum gain chargeback
requirements in the Regulations and shall be interpreted consistently therewith.

          (d) Any Stockholder Nonrecourse Deductions for any taxable year shall be specially allocated
to the Stockholder who bears the economic risk of loss with respect to the Stockholder Nonrecourse
Debt to which such Stockholder nonrecourse deductions are attributable in accordance with
Regulation Section 1.704-2(i). The amount of Stockholder Nonrecourse Deductions with respect to a
Stockholder Nonrecourse Debt for a taxable year equals the excess, if any, of the net increase, if

19

 

any, in the amount of Stockholder Minimum Gain attributable to such Stockholder Nonrecourse
Debt during that Taxable year over the aggregate amount of any distributions during that taxable
year to the Stockholder that bears the economic risk of loss for such Stockholder Nonrecourse Debt
to the extent such distributions are from the proceeds of such Stockholder Nonrecourse Debt and are
allocable to an increase in Stockholder Minimum Gain attributable to such Stockholder Nonrecourse
Debt, determined in accordance with Regulation Section 1.704-2(i)(1).

          (e) In the event any Stockholder unexpectedly receives any adjustment, allocation or
distribution described in paragraphs (4), (5) or (6) of Regulation Section 1.704-1(b)(2)(ii)(d), a
pro rata portion of each item of Company income and gain shall be specially allocated to the
Stockholder in an amount and manner sufficient to eliminate , to the extent required by the
Regulations , the Adjusted Capital Account Deficit of that Stockholder as quickly as possible. The
items to be allocated will be determined in accordance with Regulations Section
1.704-1(b)(2)(ii)(d)(6). This Section 5.4(e) is intended to comply with Regulations Section 1.704-1(b)(2)(ii)(d) and will be applied and interpreted in accordance with such regulation;
provided, that an allocation pursuant to this Section 5.4(e) shall be made only if and to the
extent that such Stockholder would have an Adjusted Capital Account Deficit after all other
allocations provided for in this Article V have been tentatively made as if this Section 5.4(e)
were not in the Agreement.

          (f) In the event that any Stockholder has a deficit balance in its Adjusted Capital Account at
the end of any taxable year, that Stockholder shall be specially allocated items of Company income
and gain in the amount of such excess as quickly as possible, provided that an allocation pursuant
to this Section 5.4(f) shall be made only if and to the extent that such Stockholder would have a
deficit balance in its Adjusted Capital Account after all other allocations provided for in this
Article V have been made as if Section 5.4(e) and this Section 5.4(f) were not in this Agreement.

          (g) No items of loss or deduction will be allocated to any Stockholder to the extent that any
such allocation would cause the Stockholder to have (or increase the amount of) a Deficit balance
in its Adjusted Capital Account at the end of any Company taxable year. All items of loss or
deduction in excess of the limitation set forth in this Section 5.4(g) shall be allocated among
such other Stockholders, which do not have a deficit balance in their Adjusted Capital Accounts,
pro rata, in proportion to the number of shares of Common Stock held by each of them, until no
Stockholder may be allocated any such items of loss or deduction without having or increasing such
a deficit balance in its Adjusted Capital Account. Thereafter, any remaining items of loss or
deduction shall be allocated to the Stockholders, pro rata, in proportion to the number of shares
of Common Stock held by each of them.

          (h) To the extent an adjustment to the adjusted tax basis of any Company asset pursuant to
Code Section 734(b) or Code Section 743(b) is required, pursuant to Regulation Section
1.704-1(b)(2)(iv)(m), to be taken into account in determining Capital Accounts, the amount of that
adjustment to the Capital Accounts shall be treated as an item of gain (if the adjustment increases
the basis of the asset) or

20

 

loss (if the adjustment decreases the basis of the asset), then that gain or loss shall be
specially allocated to the Stockholders in the manner consistent with the manner in which their
Capital Accounts are required to be adjusted pursuant to that Regulation.

          (i) The allocations set forth in Section 5.4(a) through (h) hereof (the “Regulatory
Allocations”) are intended to comply with certain requirements of Treasury Regulations Section
1.704-1(b) and 1.704-2. The Regulatory Allocations may not be consistent with the manner in which
the Stockholders intend to divide Company distributions. Accordingly, the Board is authorized to
divide allocations of Profits, Losses and other items among the Stockholders so as to prevent the
Regulatory Allocations from distorting the manner in which Company distributions are required to be
divided among the Stockholders pursuant to this Agreement. In general, the Stockholders anticipate
that this will be accomplished by specially allocating Profits and Losses and items of income,
gain, loss and deduction among the Stockholders so that the net amount of the Regulatory
Allocations and such special allocations to each Stockholder is zero. The Board will have
discretion to accomplish this result in any reasonable manner.

          (j) In the event that a guaranteed payment to a Stockholder is ultimately recharacterized as a
distribution for federal income tax purposes (as the result of an audit of the Company’s return or
otherwise) and if such recharacterization has the effect of disallowing a deduction or reducing the
adjusted basis of any asset of the Company, then an amount of Company gross income equal to such
disallowance or reduction shall be allocated to the recipient of such payment. In the event that a
distribution to a Stockholder is ultimately recharacterized as a guaranteed payment for federal
income tax purposes (as a result of an audit of the Company’s return or otherwise), and if any such
recharacterization gives rise to a deduction, such deduction shall be allocated to the recipient of
the distribution.

          (k) The expense for each tax paid or accrued by the Company shall be allocated to each
Stockholder’s Capital Account in proportion to the allocation among such Capital Accounts of the
income to which such tax relates (in the manner contemplated by Regulations Section
1.704-1(b)(4)(viii) and the examples relating thereto). In so allocating expense for each tax paid
or accrued by the Company, the Company will not take into account revaluation gains and losses, as
described in paragraph (b) of the definition of “Book Value,” in computing the total income,
expenses, gains and losses allocated to each Capital Account.

     5.5 Distributions. (a) The Board may approve the payment of Distributions to Stockholders
from time to time, subject to Section 3.4(c). Distributions may be authorized, declared and paid
by the Board in any amount that it deems to be in the best interests of the Company and its
Stockholders, provided, however, that the Board may not authorize the payment of any Distribution
in any fiscal year that would be reasonably likely to result in the Company’s (i) breach or
violation of any ongoing contractual obligation of the Company or any of its Subsidiaries or (ii)
violation of applicable law.

21

 

          (b) Subject to the limitations of Section 5.5(a), the Board will authorize, declare and pay
quarterly Distributions to Stockholders in an amount at least equal to the estimated U.S. federal,
state or local taxes such Stockholders will be required to pay by virtue of the allocation of
Company taxable income to such Stockholders (the “Tax Distribution”). The amount of the
Tax Distribution for each Stockholder for any fiscal period will be calculated by approximating
each such Stockholder’s or, in the case of a pass-through entity, its direct or indirect equity
holders’, tax liability in respect of taxable income allocated to it during the preceding quarter,
and using the single highest effective tax rate determined by the Board in good faith for
application to all Stockholders. Further, to the extent the Company is required by any federal,
state or local law or regulation to withhold from, or pay income taxes with respect to, any
distribution or allocation to any member, such amount of taxes withheld or paid shall be considered
as a distribution to pay taxes under this Section 5.5. The amount of such taxes withheld or paid
with respect to any Stockholder shall be applied against the amount of the distribution otherwise
payable to the Stockholder under this Section 5.5. Any Tax Distribution made to a Stockholder will
be treated as having been distributed under Section 5.5(c) or Section 5.5(d), as applicable, and
thus will reduce, dollar for dollar, the distributions to which such Stockholder would otherwise be
entitled pursuant to Section 5.5(c) or Section 5.5(d).

          (c) Subject to the limitations of Section 5.5(a), the Board may authorize, declare and pay
Distributions to Stockholders in addition to those required pursuant to Section 5.5(b). Such
distributions will be made to the Stockholders in proportion to the number of shares of Common
Stock held by each of them.

          (d) Upon the liquidation of the Company, distributions of the assets of the Company to the
Stockholders will be made in proportion to the number of shares of Common Stock held by each of
them. It is intended that such distributions will result in the Stockholders receiving aggregate
distributions equal to their respective positive Capital Account balances, after giving effect to
all adjustments for the taxable year in which liquidation of the Company occurs. However, if the
positive balances in the Capital Accounts of the Stockholders are not equal to the amounts to be
distributed to each such Stockholder pursuant to this Section 5.5(d), constituent items of income,
gain, loss and deduction will be reallocated among the Stockholders for the year of liquidation, to
the extent permissible under Code Section 704(b) (and, if necessary and permissible under Code
Section 704(b), for prior Company taxable years for which the deadline (determined without regard
to extensions) for the filing of the Company’s federal income tax return has not passed), so as to
cause the balances in the Capital Accounts of the Stockholders to be in the amounts necessary to
assure that such result is achieved.

     5.6 Allocations and Distributions to New Stockholders. If shares of Common Stock are
transferred or if additional shares of Common Stock are issued to a new Stockholder during any
fiscal year, Profits and Losses for the fiscal year will be allocated to the new Stockholder in
accordance with section 706(d) of the Code, using any conventions permitted by law and selected by
the Stockholders. All Distributions on

22

 

or before the date of a transfer will be made to the transferor, and all Distributions after
the date of a transfer must be made to the transferee.

     5.7 Capital Accounts. The Company will maintain an accounting record of each Stockholder’s
capital interest in the Company as determined under the rules set forth in Regulation Section
1.704-1(b) (a “Capital Account”). There shall be credited to each Stockholder’s Capital Account (a)
the amount of any contribution of cash by that Stockholder, (b) the Book Value of property
contributed by that Stockholder, (c) that Stockholder’s allocable share of Profits and any items in
the nature of income or gain that are specially allocated to that Stockholder, and (d) the amount
of any Company liabilities assumed by such Stockholder or which are secured by any property
distributed to such Stockholder. There shall be debited against each Stockholder’s Capital Account
(i) the amount of all distributions of cash to that Stockholder unless a distribution to the
Stockholder is a loan or is deemed a payment under Code Section 707(c), (ii) the Book Value of
property distributed to that Stockholder by the Company, (iii) that Stockholder’s allocable share
of Losses and any items in the nature of expenses or losses which are specially allocated to that
Stockholder, and (iv) the amount of any liabilities of such Stockholder assumed by the Company or
which are secured by any property contributed by such Stockholder to the Company. This definition
of Capital Account and the other provisions herein relating to the maintenance of Capital Accounts
are intended to comply with Regulation Sections 1.704-1(b) and 1.704-2 and shall be interpreted and
applied in a manner consistent with those Regulation Sections. In the event the Board reasonably
determines that it is prudent to modify the manner in which the Capital Accounts, or any debits or
credits thereto, are computed in order to comply with that Regulation, the Board may make such
modification, provided that such modifications are not reasonably expected to materially alter the
amount and timing of distributions to the Stockholders pursuant to Section 5.5 hereof. The Board
shall also make any appropriate modifications in the event unanticipated events might otherwise
cause this Agreement not to comply with Regulation Sections 1.704-1(b) and 1.704-2, provided that
such modifications are not reasonably expected to materially alter the amount and timing of
distributions to the Stockholders pursuant to Section 5.5 hereof.

     5.8 Tax Allocations. (a) Any item of income, gain, deduction or loss (including creditable
foreign tax expenditures) with respect to any property (other than money) that has been contributed
by a Stockholder to the capital of the Company and which is required to be allocated to
Stockholders for income tax purposes under section 704(c) of the Code so as to take into account
the variation between the tax basis of such property and its Book Value at the time of its
contribution, will be allocated to the Stockholders for income tax purposes using such method
permitted under section 1.704-3 of the Regulations as the Company may select through unanimous
consent of the Board. If the Capital Accounts are adjusted pursuant to section
1.704-1(b)(2)(iv)(f) or (g) of the Regulations with respect to a revaluation of any asset of the
Company, subsequent allocations of income, gain, loss, and deduction, including depreciation or
deductions for cost recovery with respect to such asset, will take account of any variation between
the then existing adjusted basis of such asset for federal income tax purposes and the Book Value
of such asset as required by

23

 

section 1.704-1(b)(2)(iv)(g)
of the Regulations. Notwithstanding the foregoing, if any Stockholder contributed property
with an adjusted tax basis in excess of the initial Book Value for such property, the Company shall
take into account such variation only in determining the amount of items allocated to the
contributing Stockholder, and except as provided in Regulations, in determining the amount of items
allocated to the noncontributing Stockholders, the tax basis of the contributed property in the
hands of the Company shall be treated as being equal to its initial Book Value. Creditable foreign
tax expenditures shall be allocated among the Stockholders for federal income tax purposes by
taking into account such 704(c) built-in gain or loss as provided in Regulations Section
1.704-1(b)(4)(viii)).

          (b) Each Stockholder represents and warrants that by executing this Agreement or a joinder to
this Agreement it is aware of the income tax consequences of allocations of profit and loss and
hereby agrees to report its share of such profits and loss for income tax purposes in a manner
consistent with such allocations.

     5.9 Tax Withholding. Each Stockholder agrees to allow the Company or the Tax Matters Member
to make appropriate tax withholdings pursuant to section 1446 of the Code. Any federal tax
obligation withheld on distributable net income by the Company or by the Tax Matters Member
pursuant to section 1446 of the Code will be directly attributable to the Stockholder or
Stockholders that are subject to such withholding in proportion to each Stockholder’s share of
distributable net income.

     5.10 Section 754 Elections. The Company shall be required to make a section 754 election upon
proper notice and request of a transferee Stockholder and provide information to the Stockholders
regarding the adjustment to the transferee.

     5.11 Grant of Profits Interest in Exchange for Services. By executing this Agreement, the
Stockholders and the Company agree that the Company and the Board are authorized and directed to
take such actions (including the making of an appropriate tax elections) as may be required by any
authority that may be issued in the future with respect to the taxation of “profits interests”
transferred in connection with the performance of services to conform the tax consequences to any
Stockholder that receives such “profits interest” as closely as possible to the consequences under
Revenue Procedure 93-27 and Revenue Procedure 2001-43. The Company and each of its Stockholders
(including the “profits interest” recipient Stockholder) agree to comply with all requirements
imposed in respect of such actions and consents to the amendment of this Agreement to the extent
such subsequent authority in order to permit the issuance of such “profits interests,” provided
that such amendment is not materially adverse to any Stockholder (other than due to a lower tax
deduction to the Company).

     5.12 Preparation of Tax Returns. The Company shall arrange for the preparation by the
independent certified public accountants retained by the Company of, and the timely filing of all
returns of the Company for federal, state, local and foreign tax purposes and shall cause to be
furnished to the Stockholders, the tax information reasonably required for the Stockholders’
federal, state, local and foreign tax reporting purposes (including but not limited to required
U.S. reporting of foreign operations) on or

24

 

before June 30th of each year in the U.S. The classification, realization and
recognition of income, gain, losses and deductions and other items, for tax purposes, shall be on
that method of accounting adopted by unanimous consent of the Stockholders.

     5.13 Tax Controversies. The Tax Matters Member is authorized and required to represent the
Company (at the Company’s expense) in connection with all examinations of the Company’s affairs by
tax authorities, including resulting administrative and judicial proceedings, and to expend Company
funds for professional services and costs associated therewith. The Tax Matters Member agrees to
promptly provide to the other Stockholders copies of any correspondence or other documents received
from or sent to any federal, state, local or foreign tax authorities relating to any examination of
the Company’s affairs. Each Stockholder, shall at its own expense, be permitted to attend and
participate in any discussions, negotiations or proceedings in which the Tax Matters Member is
involved on behalf of the Company.

     5.14 Capital Account Deficit Restoration. No Stockholder shall be obligated to restore after
the liquidation of the Company any deficit in its Adjusted Capital Account balance, and no creditor
of the Company shall have any right to enforce any obligation to restore any deficit Adjusted
Capital Account balance of any Stockholder.

     5.15 Tax Elections and Other Tax Matters. Unless otherwise specifically provided herein, all
United States federal income tax elections applicable to the Company shall be made by the unanimous
approval of the Board. In addition, if proposed Treasury Regulation Section 1.704-1(s) is
finalized, or a similar regulation is promulgated, the Stockholders will cooperate in good faith to
avoid the recognition by Lear NAOC of any taxable income or taxable gain in respect of Lear NAOC’s
exercise of the Lear Warrant.

VI. OTHER COVENANTS

     6.1 Public Offering. (a) Lear Demand Request. Provided that Lear NAOC has first
complied with Section 4.5 and either the Call Option granted pursuant thereto has not been
exercised or the Call Option has been exercised but the Call Option Closing has not occurred by the
date that is 20 days after the final determination of the Call Price, Lear NAOC may exercise its
demand registration rights set forth in the Registration Rights Agreement (a “Lear Demand
Request”). Lear NAOC’s right to make the Lear Demand Request will terminate upon Lear NAOC’s
transfer of any shares of Capital Stock or Options other than (i) in connection with a pledge (or
exercise pursuant thereto) of all of the Capital Stock and Options owned by Lear NAOC permitted
pursuant to Section 4.1(a), or (ii) a Transfer in accordance with this Agreement.

          (b) Board Decision. Subject to Section 3.4(b), in the event that the Board determines
pursuant to the Required Board Approval that it would be advisable to cause the equity of the
Company or its business to be sold to the public in a Public Offering, it may invoke Section
6.1(c).

25

 

          (c) Reorganization. If a Lear Demand Request is made or Section 6.1(b) is invoked, the
Board shall seek to facilitate a Public Offering by: (i) interposing between the Company and the
Subsidiaries a corporation that would be suitable for having its equity sold to the public in a
Public Offering (a “Newco”) or (ii) causing the Company to be reorganized (including by way
of merger, conversion, recapitalization, asset and liability transfer, or equity exchange) into a
Newco. The Board shall accomplish the foregoing (a “Reorganization”) as promptly as
practicable in such manner as it reasonably deems appropriate, efficient (including in terms of tax
treatment) and in the best interests of each of the Stockholders, subject to the requirements of
this Section 6.1. The organizational documents of Newco will be in such form as is approved by the
Board, and each Stockholder agrees to vote its shares of Capital Stock and execute all documents
and agreements as reasonably requested by the Board in furtherance of a Reorganization.

          (d) Consummation of the Reorganization. Upon the consummation of the Reorganization,
each Stockholder will be entitled to cause the Company to redeem or exchange all (but not less than
all) of its Capital Stock for the applicable pro rata portion of the Newco common stock held by the
Company, with fractional shares of Newco common stock rounded or cashed out in an equitable manner,
as determined by the Board in good faith.

     6.2 Confidentiality. Any Stockholder receiving any Confidential Information related to the
Company or its Subsidiaries or Affiliates agrees to keep such Confidential Information confidential
and not disclose such Confidential Information to any third party without the prior written consent
of the Company (in its sole discretion), provided that nothing in this Agreement will prevent such
Stockholder from disclosing such Confidential Information (i) as required by law, regulation, other
legal process or the rules of any national stock exchange applicable to such Stockholder or any of
its Affiliates, (ii) to its limited partners or shareholders, representatives (including attorneys
and accountants), agents and affiliates, provided such Persons agree to be bound by the provisions
of this Section 6.2, (iii) as part of such Stockholder’s normal reporting, rating or review
procedures (including normal credit rating or pricing process) and (iv) in connection with the
transfer or proposed transfer of Common Stock, if the transferee or proposed transferee agrees in
writing to be bound by the provisions hereof.

     6.3 Information Rights. (a) The Company will, and will cause each of its Subsidiaries,
Affiliates, officers, directors, employees, auditors and agents, to afford each of WLR, Lear NAOC
and Franklin (as long as it is a Majority or Minority Stockholder, as applicable) and its
representatives and agents, upon reasonable notice, reasonable access during business hours to its
officers, employees, auditors, agents, properties, offices and other facilities and to all books
and financial and other records of the Company and the Subsidiaries.

          (b) The Company will furnish to each Stockholder the following:

     (i) within 30 days following the conclusion of each of the Company’s first
three fiscal quarters of each fiscal year, quarterly

26

 

unaudited consolidated financial statements of the Company and the
Subsidiaries;

     (ii) within 60 days following the conclusion of the Company’s fiscal year,
annual audited consolidated financial statements of the Company and the Subsidiaries
audited by the Company’s independent accountants;

     (iii) within 15 days following the conclusion of each month, unaudited
consolidated financial statements of the Company and the Subsidiaries for such
month;

     (iv) within 15 days following the conclusion of each of the Company’s first
three fiscal quarters of each fiscal year, quarterly U.S. GAAP tax accrual
workpapers prepared in accordance with SFAS 109, Accounting for Income Taxes; and

     (v) within 30 days following the conclusion of the Company’s fiscal year,
annual U.S. GAAP tax accrual workpapers prepared in accordance with SFAS 109,
Accounting for Income Taxes.

     6.4 WLR Advisory Fee. For as long as WLR is the Majority Stockholder, WL Ross & Co. LLC shall
be entitled to the following advisory fees: (a) in the case of a cash capital contribution by
Franklin or Lear NAOC to the Company or a Subsidiary, other than capital contributions (i) by Lear
NAOC or Franklin pursuant to Section 2.3 or (ii) by Lear NAOC pursuant to Section 2.2, Franklin or
Lear NAOC, as the case may be, will pay WL Ross & Co. LLC an advisory fee equal to 1.5% of such
cash capital contribution; and (b) in the case of a cash capital contribution to the Company or a
Subsidiary from a Person other than WLR, Franklin or Lear NAOC, such Person will be required to pay
WL Ross & Co. LLC an advisory fee equal to 4.0% of such cash capital contribution. The advisory
fee shall be payable in cash contemporaneously with, and as a condition to, the capital
contribution on which it is based. For the avoidance of doubt, the parties acknowledge and agree
that WL Ross & Co. LLC shall not be entitled pursuant to this Section 6.4 to any advisory fee in
connection with a Transfer of Capital Stock by a Stockholder or in connection with a Public
Offering.

     6.5 Noncompetition. (a) Each of WLR and Franklin, each on behalf of itself and its
Affiliates, and Lear NAOC, on behalf of itself and Lear Corporation and its Subsidiaries, agrees
that, as long as it is a Stockholder and, in the case of Lear NAOC and WLR, for a period of one
year thereafter (the “Non-Compete Period”), it will not at any time without the prior
written consent of the Company, directly or indirectly, in any state, territory or possession of
the United States of America, the United Mexican States or Canada in which the Business has
material operations as of the date of the Lear Acquisition Agreement (the “Territory”)
form, acquire, finance, own an interest in, operate or control an enterprise which is directly
competitive with the Business (a “Competing Business”). Nothing herein shall prohibit any
Stockholder from (x) being a passive owner, directly or indirectly, of not more than 20% of the
outstanding equity, or

27

 

instruments convertible into 20% of the outstanding equity, of any Person that is a Competing
Business which is publicly traded, so long as it does not have an active participation in the
business of such Persons, or (y) managing investments in Competing Businesses for the account of
Persons who are not Affiliates. Notwithstanding anything to the contrary in this Agreement, with
respect to Lear NAOC the restrictions in this Section 6.5 shall terminate upon a Change in Control
with respect to Lear NAOC or on the first anniversary of Lear NAOC’s ceasing to be a Minority
Stockholder; provided, that in the case of a Change in Control with respect to Lear NAOC, Lear NAOC
or its successor shall (a) cause its Board designees (as designated pursuant to Section 3.3(a)
herein) and Observers to immediately resign from the Board and each Subsidiary Board, (b) cease to
have any right to appoint any individual to fill such vacancies, (c) retain in strict confidence
any Confidential Information that it has obtained as a member of the Board or any Subsidiary Board,
as the case may be, and shall not use for any purpose whatsoever, or divulge, disseminate or
disclose to any third party or Person involved in a Competing Business, any such Confidential
Information, it being understood that the exceptions in clauses (ii)-(iv) of Section 6.2 shall no
longer apply to Lear NAOC or its successor, and (d) no longer be entitled to receive any
Confidential Information. Notwithstanding anything to the contrary in this Agreement, Lear NAOC
shall be entitled to: (i) engage in sequencing activities in relation to a Competing Business, (ii)
to generate annual gross revenues of up to $200,000,000 attributable to a Competing Business (as
determined without regard to sequencing revenues), if such revenues are attributable to ancillary
activities of Lear NAOC relating to Lear NAOC’s core business operations, provided, that Lear NAOC
shall first provide the Company the opportunity to bid for such ancillary activities and will award
such activities to the Company if its bid is more competitive than the terms on which Lear NAOC is
willing to provide such activities, and (iii) engage in activities related to the development,
manufacture and/or sale of automotive seats or seat components, electrical distribution systems or
components, or electronic systems or components. In addition, notwithstanding the above, in the
event Lear NAOC directly or indirectly acquires all of or any portion of any Person, whether by
merger, consolidation, purchase of assets or otherwise, this Section 6.5 shall not apply with
respect to the continued operation of the business of such Person if (i) such Person, at the time
of the acquisition, has annual gross revenue from a Competing Business equal to or less than
$100,000,000, or (ii) such Person, at the time of the acquisition, has annual gross revenue from a
Competing Business greater than $100,000,000 and, in the case of clause (ii), Lear NAOC disposes of
such Competing Business to a third party purchaser within 15 months after the acquisition thereof;
provided that in each case Lear NAOC does not provide Confidential Information to any Person
involved in such Competing Business.

          (b) The Stockholders agree that the covenants set forth in this Section 6.5 are reasonable in
temporal and geographical scope and in all other respects.

          (c) The Company and the Stockholders intend that the covenants of this Section 6.5 shall be
deemed to be a series of separate covenants, one for each county or province of each and every
state, territory or jurisdiction of each country within the Territory and one for each month of the
Non-Compete Period.

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          (d) If, at the time of enforcement of this Section 6.5, a court shall hold that the duration
or scope stated herein is unreasonable under circumstances then existing, the Company and the
Stockholders agree that the maximum duration or scope under such circumstances shall be substituted
for the stated duration or scope and that the court shall be allowed to revise the restrictions
contained herein to cover the maximum period and scope permitted by law.

          (e) Each of the Minority Stockholders shall have the right to seek to enforce the terms of
this Section 6.5 against any of the other Stockholders.

          (f) Each Stockholder recognizes and affirms that in the event of its breach of any provision
of this Section 6.5, money damages would be inadequate and the Company would not have an adequate
remedy at law. Accordingly, each Stockholder agrees that in the event of a breach or a threatened
breach by any Stockholder of any of the provisions of this Section 6.5, the Company and the
Stockholders, in addition and supplementary to other rights and remedies existing in its favor, may
apply to any court of law or equity of competent jurisdiction for specific performance and/or
injunctive or other relief in order to enforce or prevent any violations of the provisions hereof
(without posting a bond or other security).

     (g) For purposes of this Section 6.5, “Stockholder,” “WLR” and “Franklin” shall mean, with
respect to WLR and Franklin, WLR and Franklin and each of their Affiliates, and “Stockholder” and
“Lear NAOC” shall mean, with respect to Lear NAOC, Lear NAOC and Lear Corporation and its
Subsidiaries.

VII. GENERAL

     7.1 Waivers and Consents; Amendments. (a) No course of dealing and no delay in exercising
any rights hereunder will operate as a waiver of the rights hereof. No provision hereof may be
waived other than by a written instrument signed by the party or parties waiving such provision.
The Company shall not waive any provision of this Agreement without the consent of each of the
Minority Stockholders. Except as provided in Section 7.1(b), this Agreement may only be amended by
the Required Board Approval and the consent of each of the Minority Stockholders, provided,
that no amendment shall (i) change the limitation on liability of the Stockholders or the
Stockholders’ right to distributions on a pro rata basis in each case without the written consent
of each affected Stockholder or (ii) adversely affect any Stockholder without the written consent
of the Stockholder so adversely affected.

          (b) The Stockholders hereby specifically consent to the amendment of this Agreement from time
to time in such manner as is determined by counsel for the Company to be necessary upon publication
of final regulations in the federal Register (or other official pronouncement), to provide for (A)
the election of a safe harbor under proposed Treasury Regulations Section 1.83-3(l) (or any similar
provision) under which the fair market value of Capital Stock that is transferred in connection
with the performance of services is treated as being equal to the liquidation value of that
interest, (B) an agreement by the Company and all of its Stockholders to comply with all the
requirements set forth in such proposed Treasury Regulations and Notice 2005-43 (and

29

 

any other guidance provided by the Internal Revenue Service with respect to such election)
with respect to all Common Stock transferred in connection with the performance of services while
the election remains effective, and (C) any other related amendments.

     7.2 Governing Law. This Agreement will be deemed to be a contract made under, and will be
construed in accordance with, the laws of the State of Delaware without giving effect to conflict
of laws principles thereof.

     7.3 Notices and Demands. Any notice or demand which is required or permitted to be given
under this Agreement must be given, and will be deemed to have been sufficiently given for all
purposes of this Agreement, on the date delivered by hand or distributed by fax or e-mail prior to
5:00 p.m., Eastern Standard Time (otherwise, such notice will be deemed received on the next
succeeding business day in the place of receipt), or the next business day after being sent by
overnight delivery by a reputable overnight courier service providing receipt of delivery, to the
addresses of the Stockholders set forth on Schedule 1.

     7.4 Remedies; Severability. It is specifically understood and agreed that any breach of the
provisions of this Agreement by any Person subject hereto will result in irreparable injury to the
other parties hereto, that the remedy at law alone will be an inadequate remedy for such breach and
that, in addition to any other remedies which they may have, such other parties may enforce their
respective rights by actions for specific performance (to the extent permitted by law). Whenever
possible, each provision of this Agreement will be interpreted in such a manner as to be effective
and valid under applicable law, but if any provision of this Agreement is deemed prohibited or
invalid under such applicable law, such provision will be ineffective to the extent of such
prohibition or invalidity, and such prohibition or invalidity will not invalidate the remainder of
such provision or the other provisions of this Agreement.

     7.5 Integration. This Agreement, including any exhibits or schedules referred to herein or
attached hereto (each of which is a part of this Agreement), constitutes the entire agreement, and
supersedes all other prior agreements and understandings, both written and oral, among the parties
with respect to the subject matter hereof.

     7.6 Binding Agreement. This Agreement will be binding upon and enforceable by, and will inure
to the benefit of, the parties hereto and their respective successors, heirs, executors,
administrators and permitted assigns, and no others. Nothing in this Agreement will give any other
Person not named herein the benefit of any legal or equitable right, remedy or claim under this
Agreement. The rights and obligations under this Agreement are evidenced by the ownership of the
Capital Stock and Options. Notwithstanding the foregoing, the rights of the Majority Stockholder
and the Minority Stockholders in their capacities as such (i.e., in contrast to the rights of
Stockholders generally) may only be transferred by WLR, Franklin and Lear NAOC in connection with a
Transfer of Capital Stock and Options to their Permitted Transferees.

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     7.7 Termination. (a) This Agreement will terminate automatically on the earlier of:

     (i) the written agreement of the Stockholders; or

     (ii) the consummation of an initial Public Offering.

     7.8 Counterparts. This Agreement may be executed simultaneously in two or more counterparts
(including facsimile copies), any one of which need not contain the signatures of more than one
party, but all such counterparts taken together will constitute one and the same agreement.

     7.9 Jurisdiction; Consent to Service of Process. (a) Each party hereby irrevocably and
unconditionally submits, for itself and its property, to the exclusive jurisdiction of the New York
state court located in the Borough of Manhattan, City of New York or the United States District for
the Southern District of New York (as applicable, the “New York Court”), and any appellate
court from any such court, in any proceeding arising out of or relating to any Constituent
Document, or for recognition or enforcement of any judgment resulting from any such proceeding, and
each party hereby irrevocably and unconditionally agrees that all claims in respect of any such
suit, action or proceeding may be heard and determined in the New York Court.

          (b) It will be a condition precedent to each party’s right to bring any such proceeding that
such proceeding, in the first instance, be brought in the New York Court (unless such proceeding is
brought solely to obtain discovery or to enforce a judgment), and if each such court refuses to
accept jurisdiction with respect thereto, such proceeding may be brought in any other court with
jurisdiction; provided that the foregoing will not apply to any proceeding by a party seeking
indemnification or contribution pursuant to any Constituent Document or otherwise in respect of a
proceeding against such party by a third party if such proceeding by such party seeking
indemnification or contribution is brought in the same court as the proceeding against such party.

          (c) No party may move to (i) transfer any such proceeding from the New York Court to another
jurisdiction, (ii) consolidate any such proceeding brought in the New York Court with a proceeding
in another jurisdiction, or (iii) dismiss any such proceeding brought in the New York Court for the
purpose of bringing the same in another jurisdiction.

          (d) Each party hereby irrevocably and unconditionally waives, to the fullest extent it may
legally and effectively do so, (i) any objection which it may now or hereafter have to the laying
of venue of any proceeding arising out of or relating to the Constituent Documents in the New York
Court, (ii) the defense of an inconvenient forum to the maintenance of such proceeding in any such
court, and (iii) the right to object, with respect to such proceeding, that such court does not
have jurisdiction over such party. Each party irrevocably consents to service of process in any
manner permitted by law.

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     7.10 WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO IRREVOCABLY WAIVES ANY AND ALL RIGHT TO
TRIAL BY JURY IN ANY ACTION, PROCEEDING, CLAIM OR COUNTERCLAIM, WHETHER IN CONTRACT OR TORT, AT LAW
OR IN EQUITY, ARISING OUT OF OR IN ANY WAY RELATED TO THE TRANSACTION DOCUMENTS OR THE TRANSACTIONS
CONTEMPLATED THEREBY.

     7.11 No Strict Construction. The parties have participated jointly in the preparation of the
Constituent Documents. In the event an ambiguity or question of intent or interpretation arises,
any provision contained in the Constituent Documents will be construed as if drafted jointly by the
parties, and no presumption or burden of proof will arise favoring or disfavoring any party by
virtue of the authorship of any of the provisions of the Constituent Documents.

     7.12 Certain Other Interpretive Matters. (a) Titles and headings to Sections herein are
inserted for convenience of reference only, and are not intended to be a part of or to affect the
meaning or interpretation of this Agreement.

          (b) Unless the context otherwise requires, (i) all references to articles, sections or
schedules are to articles, sections or schedules of this Agreement, (ii) the words “include”,
“includes”, and “including” shall be deemed to be followed by “without limitation” whether or not
they are in fact followed by such words or words of similar import, (iii) each term defined in this
Agreement has the meaning assigned to it, and (iv) each accounting term not otherwise defined in
this Agreement has the meaning assigned to it in accordance with U.S. GAAP. All references to “$”
or dollar amounts are references to lawful currency of the United States of America.

     7.13 Expenses. All Reimbursable Expenses incurred by WLR, Franklin and Lear NAOC will be paid
or reimbursed by the Company. The Company will pay and be responsible for all expenses and fees
relating to its formation.

     7.14 Definitions. For purposes of this Agreement, in addition to the terms defined elsewhere
herein, the following terms have the following meanings when used herein with initial capital
letters:

   “2007 EBITDA” means the consolidated net income of the Business for calendar year
2007, (a) excluding (to the extent net income is reduced or increased or net loss is increased or
reduced thereby), without duplication, (i) interest expense, (ii) provisions for taxes based on
income, (iii) depreciation expense, (iv) amortization expense, (v) Restructuring Costs, (vi)
transaction costs incurred in connection with the consummation of the transactions contemplated in
the Lear Acquisition Agreement, (vii) gains or losses on the sale or disposal of assets not in the
ordinary course of business, (viii) the cumulative effect of any changes in accounting principles
or policies, (ix) investment income and losses, (x) fees or other amounts paid to Affiliates of the
Company, other than reimbursement of out-of-pocket expenses incurred in good faith in furtherance
of the Business, (xi) any WLR advisory or management fees, (xii) non-recurring or extraordinary
gains, losses or expenses and (xiii) any costs related to establishing the Business as a stand
alone entity, including costs incurred under the Transition Services Agreement, (b) adding thereto,
without limitation, the actual benefits of any of the following occurring (in whole or in part)
prior to December 31, 2007, in each case measured relative to the circumstances as of the date of
the Lear Acquisition Agreement and annualized for the entire 2007 calendar year, (x) implementation
of the Restructuring Plan, (y) increased pricing and other changes to customer contracts agreed to
or implemented on or after the date of the Lear Acquisition Agreement, and (z) changes in wage
rates, benefits and other aspects of labor or benefit

32

 

 agreements agreed to or implemented on or after the date of the Lear Acquisition Agreement (or
agreed to prior to, but implemented on or after the date of the Lear Acquisition Agreement), (c)
deducting therefrom any costs incurred under the Transition Services Agreement (other than
non-recurring, one-time costs) and, without duplication, any actual additional recurring
administrative and overhead expenses consistent with the services initially provided under the
Transition Services Agreement or otherwise required to operate the Business as a stand alone
entity, in each case annualized for the entire 2007 calendar year, and (d) including such other
equitable adjustments (additions or exclusions) as reasonably appropriate to account for and
exclude from 2007 EBITDA the effects of non-recurring, extraordinary events or transactions outside
the ordinary course of business. The annualized benefits described in (b) above, the annualized
costs described in (c) above and the equitable adjustments described in (d) above shall be
determined in good faith and the Company and/or Stockholders agree, upon request, to meet to
discuss the appropriate treatment of extraordinary events or transactions outside of the ordinary
course of business for purposes of determining 2007 EBITDA.

   “Accepting Optionholders” has the meaning set forth in Section 4.5.

   “Accounting Firm” means Deloitte & Touche LLP, or such other firm as may be agreed in
writing by the Company and the Stockholders.

   “Adjusted Capital Account” means, with respect to any Stockholder, such Stockholder’s
Capital Account increased by the sum of (i) such Stockholder’s share of “partnership minimum gain”
within the meaning of section 1.704-2(d) of the Regulations and (ii) such Stockholder’s share of
“partner nonrecourse debt minimum gain” within the meaning of section 1.704-2(i) of the
Regulations.

   “Affected Stockholder” has the meaning set forth in Section 4.6.

   “Affiliate” of a Person means any Person or entity which directly or indirectly
controls, is controlled by, or is under common control with (within the meaning of either Section
15 of the Securities Act or Section 20 of the Exchange Act) such Person or entity.

   “Arbiter” means a reputable investment banking or accounting firm nationally
recognized in the United States with no material relationship to the Company or any of WLR,
Franklin or Lear NAOC.

   “Asset Sale” means the sale or other disposition of all or a substantial portion of
the assets of the Company, as determined by the Board in good faith.

   “Bankruptcy Decision” means, with respect to any Person, any of the following actions:
(a) filing any voluntary petition in bankruptcy on behalf of such Person, (b) consenting to the
filing of any involuntary petition in bankruptcy against such Person, (c) filing any petition
seeking, or consenting to, reorganization or relief under any applicable federal, state or foreign
law relating to bankruptcy or insolvency, on behalf of such Person, (d) consenting to the
appointment of a receiver, liquidator, assignee, trustee, sequestrator (or other similar official)
of such Person or a substantial part of the property of such Person, or (e) making any assignment
for the benefit of creditors on behalf of such Person.

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

          “Book Value” means with respect to any Company asset, the asset’s adjusted tax basis,
except as follows:

(a) the initial Book Value of any asset contributed by a Stockholder to the Company shall be
the gross Fair Market Value of that asset;

(b) the Book Value of all Company assets shall be adjusted to equal their respective gross
Fair Market Values as of the date upon which any of the following occurs: (i) the
acquisition of an additional interest in the Company after the Effective Date by any new or
existing Stockholder, in exchange for more than a de minimis Capital Contribution or the
distribution by the Company to a Stockholder of more than a de minimis amount of Company
property as consideration for an interest in the Company, if the Board reasonably determines
that such adjustment is necessary or appropriate to reflect the relative economic interests
of the Stockholders of the Company; (ii) the liquidation of the Company within the meaning
of Regulation Section 1.704-1(b)(2)(ii)(g); and (iii) the grant of an interest in the
Company as consideration for the provision of services to or for the benefit to the Company;

33

 

(c) the Book Value of any Company asset distributed to any Stockholder shall be the gross
Fair Market Value of that asset on the date of distribution; and

(d) if an election under Code Section 754 has been made , the Book Value of Company assets
shall be increased (or decreased ) to reflect any adjustments to the adjusted basis of the
assets pursuant to Code Section 734(b) or Code Section 743(b), but only to the extent that
those adjustments are taken into account in determining Capital Accounts pursuant to
Regulation Section 1.704-1(b)(2)(iv)(m) and Section 5.4(h) hereof; provided, however, that
Book Value shall not be adjusted pursuant to this subsection (d) to the extent that the
Board reasonably determines that an adjustment pursuant to subsection (b) hereof is
necessary or appropriate in connection with a transaction that would otherwise result in an
adjustment pursuant to this subsection (d).

If the Book Value of an asset has been determined or adjusted hereby, that Book Value shall
thereafter be determined by taking into account all adjustments for depreciation, if any, taken
with respect to that asset for purposes of computing Profits and Losses.

   “Business” means the business and operations comprising the Lear North American ISD
Business as of the date of the Lear Acquisition Agreement (consisting of instrument panels,
headliners, cockpits, flooring, acoustics, door panels, blow molding and other miscellaneous
automotive plastic parts), excluding the existing joint ventures of Lear NAOC or its Affiliates,
being the Amtex, Reyes and CLA joint ventures.

   “Business Day” means a day that is not a Saturday, Sunday or day on which commercial
banking institutions located in New York City are authorized or required to close.

   “Bylaws” means the Company’s bylaws, attached as Annex B.

   “Call Notice” has the meaning set forth in Section 4.5.

   “Call Option” has the meaning set forth in Section 4.5.

   “Call Option Closing” has the meaning set forth in Section 4.5.

   “Call Price” means the fair market value of the Capital Stock subject to the Call
Option determined based on the equity value of the Company and its Subsidiaries as a whole
multiplied by the Percentage Interest represented by such Capital Stock after application of any
reasonably relevant discounts, for minority ownership status or the like, but not for liquidity,
all as agreed or determined in accordance with Section 4.5. The Call Price for an Option will
equal the Call Price for the Capital Stock for which such Option is exercisable less the applicable
exercise price.

   “Capital Account” means the capital account maintained for each Stockholder pursuant
to Section 5.7.

          “Capital Contributions” means, with respect to any Stockholder, the amount of money
and the initial Book Value of any property (other than money), net of the amount of any debt to
which such property is subject, contributed to the Company with respect to the Common Stock in the
Company held by such Stockholder. The principal amount of a promissory note which is not readily
tradable on an established securities market and which is contributed to the Company by the maker
of the note shall not be included in the Capital Account of any Person until the Company makes a
taxable disposition of the note or until (and to the extent) such Stockholder makes principal
payments on the note, all in accordance with Regulations Section 1.704-1(b)(2)(iv)(d)(2).

   “Capital Event” means (i) an Asset Sale, or (ii) the liquidation of the Company,
including, without limitation, a liquidation pursuant to an initial Public Offering.

   “Capital Stock” includes all equity interests of the Company or any Subsidiary,
including common stock, preferred stock, membership interests and all other equity interests of any
kind.

   “Change in Control” means, with respect to any Person, the occurrence of any of the
following events: (i) any Person becomes the beneficial owner (as defined in Rules 13d 3 and 13d 5
of the Securities Exchange Act of 1934) of securities of such Person representing more than 40% of
the total voting power of such Person’s outstanding securities determined on a fully diluted basis;
(ii) any transaction (including, without limitation, any merger or consolidation) involving such
Person after the consummation of which the holders of such Person’s equity securities immediately
prior to such consummation will not own a majority of the outstanding equity interest and voting
power of the surviving corporation immediately after such consummation; or (iii) the sale of a
majority of such

34

 

Person’s assets. For the avoidance of doubt, a Change in Control with respect to Lear
Corporation shall be considered a Change in Control with respect to Lear NAOC.

   “Charter” means the Company’s charter, attached hereto as Annex A.

   “Code” means the Internal Revenue Code of 1986, as amended from time to time, and any
corresponding provisions of any succeeding law.

   “Common Stock” means Capital Stock issued pursuant to the Company’s Constituent
Documents that is designated therein as “common stock.”

   “Confidential Information” means all intellectual property, documents, financial
statements, records, business plans, reports and other information (whether written or oral) of
whatever kind or nature, which has value to the Company or the Subsidiaries, or which is treated by
the Company or a Subsidiary as confidential and regardless of whether such information is marked
“confidential”, except such information that (i) is or becomes generally available to the public
through no action of the party (including its limited partners, representatives, agents and
affiliates) to which such information was furnished, (ii) becomes available to the receiving party
from a Person who is not, to the receiving party’s knowledge, subject to any legally binding
obligation to keep such information confidential, (iii) is in the possession of the receiving party
prior to receipt from the Company or (iv) is developed independently by the receiving party.

   “Constituent Documents” of an entity means the entity’s certificate of incorporation
or formation, operating agreement, charter, bylaws and other documents pursuant to which the entity
was legally formed and, as applied to the Company, this Agreement, the Charter and Bylaws.

   “Demand Registration” means a Demand Registration pursuant to Section 1.1 of the
Registration Rights Agreement.

   “Distribution” means a transfer of cash or property to a Stockholder on account of
Capital Stock. All amounts required to be withheld pursuant to Code section 1446 or any other
provision of federal, state or local tax law are treated as Distributions to the Stockholders
subject to such requirement.

          “Escrow Agreement” means that certain escrow agreement by and among Lear NAOC,
the Company, WL Ross, Franklin and the escrow agent named therein, the form of which is attached
hereto as Annex C.

          “Escrowed Funds” means the total amount of Sixty Million Dollars ($60,000,000) either
to be deposited and held in escrow in accordance with the terms of the Escrow Agreement or to be
covered by one or more Letters of Credit, (i) Thirty Million Dollars ($30,000,000) of which shall
be the responsibility of WL Ross, (ii) Fifteen Million Dollars ($15,000,000) of which shall be the
responsibility of Franklin, and (iii) Fifteen Million Dollars ($15,000,000) of which shall be the
responsibility of Lear NAOC.

   “Fair Market Value” means the fair market value as determined in good faith by
the Board pursuant to the Required Board Approval.

   “Foreign Subsidiary Board” has the meaning set forth in Section 3.3.

   “Foreign Subsidiary Observer” has the meaning set forth in Section 3.3.

   “Franklin” means the Stockholders identified under the name “Franklin” on Schedule
1, together with any of their Affiliates holding Capital Stock or Options.

          “Lear Acquisition Agreement” means that certain Asset Purchase Agreement dated as
of November 30, 2006, among Lear Corporation, the Company, International Automotive Components
Group North America, Inc., WLR and Franklin, as amended.

   “Lear Demand Request” has the meaning set forth in Section 6.1.

   “Lear ISD Closing” means the Closing as defined in the Lear Acquisition Agreement.

   “Lear NAOC” means Lear North Atlantic Operations Corporation and the Stockholders
identified under the name “Lear NAOC” on Schedule 1, together with any of their Affiliates
holding Capital Stock or Options.

35

 

   “Lear North America ISD Business” shall mean the Business (as defined in the Lear
Acquisition Agreement).

   “Lear Warrant” means the warrant to acquire Common Stock issued to Lear NAOC by the
Company pursuant to Section 2.2 in the form of Annex D hereto.

   “Majority in Interest” means the affirmative vote of Stockholders that hold more than
50% of the Common Stock outstanding as of the record date for such vote.

   “Marketable Securities” means securities (i) which are of a class: (a) of securities
issued or fully guaranteed by the United States of America or any agency thereof and entitled to
the full faith and credit of the United States of America, for which price quotations are routinely
quoted and for which there is a ready liquid market; or (b) both (I) registered pursuant to either
section 12(b) or section 12(g) of the Securities Exchange Act of 1934, as amended, and (II) either
listed on a national securities exchange or on the Nasdaq Stock Market; and (ii) which may be
resold immediately in the public markets without requirement of further registration under the
Securities Act or which include contractual rights that could result in the registration of such
securities under the Securities Act within six months of the date of acquisition of such
securities.

   “Minimum Gain” shall have the meaning set forth in Regulation Section 1 .704-2(d).

   “Observer” has the meaning set forth in Section 3.3(h).

   “Options” means a security convertible into, exercisable for or exchangeable for
Capital Stock or any other right or option to acquire Capital Stock, including , without
limitation, the Lear Warrant.

   “Optionholders” has the meaning set forth in Section 4.5.

   “Percentage Interest” means, with respect to a given Stockholder or shares of Capital
Stock, the percent derived by dividing the number of shares of Capital Stock held by such
Stockholder by the number of shares of Capital Stock then issued and outstanding.

   “Permitted Transferee” of a specified Person shall mean (i) any Affiliate of such
Person (and/or, in the case of Franklin, any advisory client of Franklin Mutual Advisers, LLC) or,
in the case of WLR, any limited partner or comparable passive investor in a fund or other
investment vehicle included in the definition of “WLR” that receives Capital Stock or Options
pursuant to a normal course distribution (including a winding up) pursuant to the constituent
documents of such fund or other investment vehicle; provided that, in any such case, such
transferee is not engaged directly or indirectly in a business that competes with the Business or
(ii) any direct or indirect acquiror of a Person in connection with a Change of Control.

   “Person” means an individual, corporation, partnership, limited liability company,
association, trust or any unincorporated organization.

   “Pledge Notice” has the meaning set forth in Section 4.1.

   “Profits” and “Losses” for any period means the taxable income or loss of the
Company for such period, as determined for federal income tax purposes, adjusted as follows:

   (a) Items that are required by Section 703(a)(i) of the Code to be separately stated shall be
included;

   (b) Tax-exempt income as described in section 705(a)(1)(B) of the Code realized by the Company
during such fiscal year are taken into account as if it was not tax exempt;

   (c) Expenditures of the Company described in section 705(a)(2)(B) of the Code for such year,
including items treated under section 1.704-1(b)(2)(iv)(i) of the Regulations as items described in
section 705(a)(2)(B) of the Code, are taken into account as if they were deductible items;

   (d) With respect to property (other than money) which has been contributed to the capital of
the Company, Profit and Loss are computed in accordance with the provisions of section
1.704-1(b)(2)(iv)(g) of the Regulations by computing depreciation, amortization, gain or loss based
upon the Fair Market Value of such property on the books of the Company;

   (e) With respect to any property of the Company which has been revalued as required or
permitted by the Regulations under section 704(b) of the Code, Profit or Loss are determined based
upon the Fair Market Value of such property as determined in such revaluation;

36

 

   (f) The difference between the Book Value and the Fair Market Value of any asset of the
Company are treated as gain or loss from the disposition of such asset in the event that any
revaluation of assets occur pursuant to section 1.704-1(b)(2)(iv)(e) or (f), including whenever,
any new or existing Stockholder acquires an additional interest in the Company in exchange for a
non-de minimis contribution to the capital of the Company; or such asset of the Company is
distributed to a Stockholder or a distribution is made to a Stockholder as consideration for a
reduction of such Stockholder’s interest in the Company or in liquidation of such interest as
defined in section 1.704-1(b)(2)(ii)(g) of the Regulations; and

   (g) Interest paid on loans made to the Company by a Stockholder and fees and other
compensation paid to any Stockholder are deducted in computing Profit and Loss.

   “Proportionate Interests” has the meaning set forth in Section 4.5.

   “Public Offering” means any firm commitment, underwritten public offering of the
Common Stock of the Company registered under the Securities Act, other than a registration relating
solely to a transaction under Rule 145 under the Securities Act (or any successor thereto) or to an
employee benefit plan of the Company.

   “Redemption Event” means (i) a Bankruptcy Decision with respect to any Stockholder or
(ii) (with respect to Lear NAOC only) a Change in Control with respect to Lear Corporation or the
delivery of a Pledge Notice.

   “Redemption Notice” has the meaning set forth in Section 4.6.

   “Redemption Price” means the fair market value of the Capital Stock being redeemed
pursuant to Section 4.6 determined based on the equity value of the Company and its Subsidiaries as
a whole multiplied by the Percentage Interest represented by such Capital Stock after application
of any reasonably relevant discounts, for minority ownership status, liquidity or the like, all as
agreed or determined in accordance with Section 4.6, provided, however, that the Redemption Price
shall not include a discount for liquidity if the applicable Redemption Event occurs after the date
on which Lear NAOC may first exercise the Lear Demand Right. The Redemption Price for an Option
will equal the Redemption Price for the Capital Stock for which it is exercisable less the
applicable exercise price.

   “Registration Rights Agreement” has the meaning set forth in the Lear Acquisition
Agreement.

   “Regulations” means regulations of the Department of the Treasury under the Code as
such regulations may be changed from time to time.

   “Reimbursable Expenses” means all reasonable documented third-party fees and expenses
incurred by WLR, Franklin or Lear NAOC (including for legal and other professional fees) in
connection with this Agreement, and the transactions contemplated hereby and thereby (excluding,
for the avoidance of doubt, the Lear Acquisition Agreement).

   “Reorganization” has the meaning set forth in Section 6.1.

   “Required Board Approval” means either (i) if the Board comprises less than five
directors, the unanimous approval of the Board, or (ii) if the Board comprises five directors, the
approval of four of the five members of the Board.

   “Restructuring” means the Company or any of its Subsidiaries or Affiliates (a)
becomes a party to any merger or consolidation or (b) purchases or otherwise acquires all or a
substantial part of the assets or equity of any Person.

   “Restructuring Costs” means the costs incurred by the Company in connection with
implementation of the Restructuring Plan.

   “Restructuring Plan” means the Restructuring Plan, as agreed to by the parties prior
to the date hereof, as it may be amended by the Company from time to time, provided that if the
Company materially modifies the Restructuring Plan after the date hereof, the parties shall in good
faith make such equitable adjustments as are reasonably appropriate in the calculation of 2007
EBITDA.

   “Sale Transaction” the meaning set forth in Section 3.4.

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

37

 

   “Stockholder Minimum Gain” means an amount, with respect to each Stockholder
Nonrecourse Debt, equal to the Minimum Gain that would result if such Stockholder Nonrecourse Debt
were treated as a nonrecourse liability, determined in accordance with Regulation Section
1.704-2(i).

          “Stockholder Nonrecourse Debt” shall have the meaning of “partner nonrecourse debt”
set forth in Regulation Section 1.704-2(b)(4).

          “Stockholder Nonrecourse Deductions” has the same meaning as “partner nonrecourse
deduction” in Treasury Regulation Section 1.704-2(i)(1).

          “Subsidiary” means any entity directly or indirectly controlled (within the meaning of
either Section 15 of the Securities Act or Section 20 of the Exchange Act) by the Company, whether
or not in existence as of the date hereof.

          “Target Balance” means, for any Stockholder as of any date, the amount that would be
distributable to such Stockholder on such date if (i) all the assets of the Company were sold for
cash equal to their respective Book Values as of such date, (ii) all liabilities of the Company
were paid in full (except that in the case of a nonrecourse liability, such payment would be
limited to the Book Value of the asset or assets securing such liability), and (iii) all remaining
cash were distributed to the Stockholders pursuant to Section 5.5(d).

     “WLR” means the Stockholders identified under the name “WLR” on Schedule 1,
together with any of their Affiliates holding Capital Stock or Options.

[Signature page to follow]

38

 

	 	 	 	 	 
	Executed as of the Effective Date.
	 	 	 	 
	 	 	WLR Recovery Fund III, LP
	 
	 	 	 	 
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Stephen Toy
	 

	 	 	 	 
	 

	 	Name:
	 	Stephen Toy
	 

	 	Title:
	 	Managing Director
	 
	 	 	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	 	 	Mutual Beacon Fund of Franklin Mutual Series Fund, Inc.
	 
	 	 	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Bradley Takahashi
	 

	 	 	 	 
	 

	 	Name:
	 	Bradley Takahashi
	 

	 	Title:
	 	Vice President
	 
	 	 	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	 	 	Mutual Discovery Fund of Franklin Mutual Series Fund, Inc.
	 
	 	 	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Bradley Takahashi
	 

	 	 	 	 
	 

	 	Name:
	 	Bradley Takahashi
	 

	 	Title:
	 	Vice President
	 
	 	 	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	 	 	Mutual Qualified Fund of Franklin Mutual Series Fund, Inc.
	 
	 	 	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Bradley Takahashi
	 

	 	 	 	 
	 

	 	Name:
	 	Bradley Takahashi
	 

	 	Title:
	 	Vice President

39

 

	 	 	 	 	 
	 	 	Mutual Shares Fund of Franklin Mutual Series Fund, Inc.
	 
	 	 	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Bradley Takahashi
	 

	 	 	 	 
	 

	 	Name:
	 	Bradley Takahashi
	 

	 	Title:
	 	Vice President
	 
	 	 	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	 	 	Mutual Beacon Fund
	 
	 	 	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Bradley Takahashi
	 

	 	 	 	 
	 

	 	Name:
	 	Bradley Takahashi
	 

	 	Title:
	 	Vice President
	 
	 	 	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	 	 	Mutual Discovery Fund
	 
	 	 	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Bradley Takahashi
	 

	 	 	 	 
	 

	 	Name:
	 	Bradley Takahashi
	 

	 	Title:
	 	Vice President
	 
	 	 	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	 	 	Mutual Discovery Securities Fund of Franklin Templeton Variable Insurance Products Trust
	 
	 	 	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Bradley Takahashi
	 

	 	 	 	 
	 

	 	Name:
	 	Bradley Takahashi
	 

	 	Title:
	 	Vice President
	 
	 	 	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	 	 	Mutual Shares Securities Fund of Franklin Templeton Variable Insurance Products Trust
	 
	 	 	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Bradley Takahashi
	 

	 	 	 	 
	 

	 	Name:
	 	Bradley Takahashi
	 

	 	Title:
	 	Vice President

40

 

	 	 	 	 	 
	 	 	Franklin Mutual Beacon Fund of Franklin Templeton Investment Funds
	 
	 	 	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Bradley Takahashi
	 

	 	 	 	 
	 

	 	Name:
	 	Bradley Takahashi
	 

	 	Title:
	 	Vice President
	 
	 	 	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	 	 	Franklin Mutual Recovery Fund
	 
	 	 	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Bradley Takahashi
	 

	 	 	 	 
	 

	 	Name:
	 	Bradley Takahashi
	 

	 	Title:
	 	Vice President
	 
	 	 	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	 	 	Mutual Recovery Fund Limited
	 
	 	 	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Bradley Takahashi
	 

	 	 	 	 
	 

	 	Name:
	 	Bradley Takahashi
	 

	 	Title:
	 	Vice President
	 
	 	 	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	 	 	Franklin Mutual Shares Fund of Franklin Templeton Funds
	 
	 	 	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Bradley Takahashi
	 

	 	 	 	 
	 

	 	Name:
	 	Bradley Takahashi
	 

	 	Title:
	 	Vice President

41

 

	 	 	 	 	 
	 	 	Franklin Mutual Global Discovery Fund of Franklin Templeton Investment Funds
	 
	 	 	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Bradley Takahashi
	 

	 	 	 	 
	 

	 	Name:
	 	Bradley Takahashi
	 

	 	Title:
	 	Vice President
	 
	 	 	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	 	 	EQ/Mutual Shares Portfolio of EQ/ Advisors Trust
	 
	 	 	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Bradley Takahashi
	 

	 	 	 	 
	 

	 	Name:
	 	Bradley Takahashi
	 

	 	Title:
	 	Vice President
	 
	 	 	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	 	 	Lear North Atlantic Operations Corporation
	 
	 	 	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Daniel A. Ninivaggi
	 

	 	 	 	 
	 

	 	Name:
	 	Daniel A. Ninivaggi
	 

	 	Title:
	 	Vice President & Secretary

42

 

Schedule 1

STOCKHOLDERS

AND SECURITIES OWNED

	 	 	 	 	 	 	 	 	 
	Common Stock	 	Shares	 	 	Percentage	 
	 
	 	 	 	 	 	 	 	 
	WLR
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	WLR Recovery Fund III, LP
	 	 	54,133,334	 	 	 	50.0	%
	600 Lexington Avenue, 19th Floor
	 	 	 	 	 	 	 	 
	New York, NY 10022
	 	 	 	 	 	 	 	 
	Attention: Stephen J. Toy
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	Franklin:
	 	 	 	 	 	 	 	 
	101 John F. Kennedy Parkway
	 	 	 	 	 	 	 	 
	Short Hills, NJ 07078
	 	 	 	 	 	 	 	 
	Attention: Bradley Takahashi
	 	 	 	 	 	 	 	 
	Mutual Beacon Fund of Franklin Mutual
Series Fund, Inc.
	 	 	3,163,200	 	 	 	2.92	 
	Mutual Discovery Fund of Franklin Mutual
Series Fund, Inc.
	 	 	5,638,800	 	 	 	5.21	 
	Mutual Qualified Fund of Franklin Mutual
Series Fund, Inc.
	 	 	2,533,800	 	 	 	2.34	 
	Mutual Shares Fund of Franklin Mutual
Series Fund, Inc.
	 	 	9,502,067	 	 	 	8.78	 
	Mutual Beacon Fund
	 	 	364,300	 	 	 	0.34	 
	Mutual Discovery Fund
	 	 	235,100	 	 	 	0.22	 
	Mutual Discovery Securities Fund of
Franklin Templeton Variable Insurance
Products Trust
	 	 	661,800	 	 	 	0.61	 
	Mutual Shares Securities Fund of Franklin
Templeton Variable Insurance Products
Trust
	 	 	2,365,400	 	 	 	2.18	 
	Franklin Mutual Beacon Fund of Franklin
Templeton Investment Funds
	 	 	2,268,100	 	 	 	2.09	 
	Franklin Mutual Recovery Fund
	 	 	146,400	 	 	 	0.14	 
	Mutual Recovery Fund Limited
	 	 	18,100	 	 	 	0.02	 
	Franklin Mutual Shares Fund of Franklin
Templeton Funds
	 	 	50,800	 	 	 	0.05	 
	Franklin Mutual Global Discovery Fund of
Franklin Templeton Investment Funds
	 	 	75,200	 	 	 	0.07	 
	EQ/Mutual Shares Portfolio of EQ/ Advisors
Trust
	 	 	43,600	 	 	 	0.04	 
	 
	 	 	 	 	 	 	 	 
	Lear NAOC
	 	 	 	 	 	 	 	 
	21557 Telegraph Road
	 	 	 	 	 	 	 	 
	Southfield, Michigan 48033
	 	 	 	 	 	 	 	 
	Attention: Daniel A. Ninivaggi
	 	 	27,066,667	 	 	 	25.0	 
	 	 	 
	 
	 	 	 	 	 	 	 	 
	Total
	 	 	108,266,668	 	 	 	100	%
	 	 	 

S-1

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