2006

Tokai Rika Reaches Settlement Agreement with Ashimori Industry Co., Ltd.

Aichi, Japan, February 2, 2007 - Tokai Rika Co., Ltd. ("Tokai Rika") and Ashimori Industry, Co., Ltd. (hereafter "Ashimori Industry") signed a settlement agreement over the ongoing patent infringement lawsuits and other related issues concerning the patent rights held by Tokai Rika on the pretensioner for seatbelt webbing retractors and other inventions. The main terms of the agreement are listed below.

Tokai Rika had previously filed a patent infringement suit in the Tokyo District Court and three suits in the Osaka District Court claiming that certain patent rights held by Tokai Rika were infringed by such products as the pretensioner for webbing retractors, made by Ashimori Industry. Ashimori Industry had previously asked the Japan Patent Office for a judgment invalidating the patent rights at the center of the aforementioned patent infringement suits. The settlement agreement covers a total of seven patent rights, including the corresponding foreign patents and other relevant rights as well as the four patent rights that Tokai Rika claimed against Ashimori Industry in the patent infringement suits mentioned above.

Outline of the Agreement

1. Ashimori Industry will pay to Tokai Rika a settlement of 1.25 billion yen.
2. Tokai Rika will grant immunity to Ashimori Industry against any royalty, responsibility and/or damage claims based on their past conduct on the condition that the aforementioned settlement is paid.
3. Both parties will withdraw all infringement suits, preliminary injunction requests and requests for a judgment of invalidation that they have filed against each other.
4. Tokai Rika will grant permission to Ashimori Industry to work the patents, including any relevant foreign patents, held by Tokai Rika, but will charge fees for their use.
   Tokai Rika intends to treat the settlement payment as extraordinary profit for the FY2007 (From April 1, 2006 to March 31, 2007), but currently has no plans to revise the previously announced expected results for the fiscal year.