EXHIBIT 10-U(2) EQUITY JOINT VENTURE CONTRACT

Joint Venture JV Agreement

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DANA CORP | DONGFENG AXLE CO., LTD.

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Title: EXHIBIT 10-U(2) EQUITY JOINT VENTURE CONTRACT
Governing Law: Virginia Date: 5/6/2005
Industry: Auto and Truck Parts Sector: Consumer Cyclical

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Exhibit 10-U(2)

*** indicates where a confidential portion has been omitted and filed separately

with the Commission

EQUITY JOINT VENTURE CONTRACT

PREAMBLE

Whereas, DONGFENG AXLE CO., LTD. (hereinafter referred to as DAC) is a limited

liability company incorporated in accordance with the laws of the People's

Republic of China at the date hereof, whose shareholders are DONGFENG MOTOR CO.,

LTD. (hereinafter referred to as DFL) and DONGFENG (SHIYAN) INDUSTRIAL COMPANY

(hereinafter referred to as DONGFENG INDUSTRY) and DONGFENG MOTOR CORPORATION

(hereinafter referred to as DFM).

DFL, an equity joint venture company established in accordance with the laws of

the People's Republic of China, and DANA Corporation (hereinafter referred to as

DANA CORPORATION), a corporation established in accordance with the laws of the

Commonwealth of Virginia, United States of America, entered into a Letter of

Intent on September 24th, 2003, pursuant to which DFL and DANA agree to set up

an equity joint venture company (hereinafter referred to as JVC) in Xiangfan

Municipality, Hubei Province, PRC. DFL and DANA CORPORATION agree that the

investment of DANA CORPORATION in the JVC will be carried out by DANA MAURITIUS

LIMITED, a one hundred percent (100%) wholly owned subsidiary of DANA

CORPORATION with limited liability established in accordance with the laws of

Republic of Mauritius (hereinafter referred to as DANA).

In accordance with the Joint Venture Law (as defined hereinafter), the Joint

Venture Regulations (as defined hereinafter) and other relevant laws and

regulations of the PRC, DFL and DANA, adhering to the principles of equality and

mutual benefit, agree after friendly consultations as follows:

ARTICLE 1

DEFINITION

1.1 DEFINITIONS

In this Contract, unless the context otherwise requires, the following

expressions have the following meanings:

AFFILIATE means, in relation to any Party, any enterprise, corporation,

partnership, trust or other entity (excluding the JVC) directly or indirectly

controlling or controlled by or under direct or indirect common control with

that Party; CONTROL for the purposes of this definition being taken to mean

direct ownership of fifty percent (50%) or more of the registered capital,

stocks or the voting rights of such enterprise or entity.

ANCILLARY CONTRACTS is defined in Article 30.1(a).

APPROVAL AUTHORITY is defined in Article 30.2(a).

ARTICLES OF ASSOCIATION means the Articles of Association of the JVC of even

date herewith.

BOARD means the Board of Directors of the JVC.

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BREACHING PARTY is defined in Article 24.1(a).

CHINESE GAAP means the Generally Accepted Accounting Principles applicable in

the PRC.

COMMERCIAL VEHICLES means those vehicles described in Article 4.2(b).

COMPANY TERM is defined in Article 22.1(a).

CONFIDENTIAL INFORMATION means Information relating to the business affairs,

financial information, technology and know-how, and trade secrets of any Party

or its Affiliate(s) and the JVC, obtained from that Party or its Affiliate(s) or

obtained from any third party in the course of discussing, considering or

implementing this Contract.

CONTRACT means this Equity Joint Venture Contract for the establishment of the

JVC.

DANA means Dana Mauritius Limited, a limited liability company duly established

and validly existing under the laws of the Republic of Mauritius.

DELEGATES means the General Manager, the Executive Deputy General Manger and the

Deputy General Managers delegated to the JVC by either Party and other

management and technical personnel to be delegated to the JVC upon agreement by

both Parties.

DELEGATE AGREEMENT means the DFL Delegation Agreement or the DANA Delegation

Agreement entered into between the JVC and DFL or DANA CORPORATION respectively.

DEPUTY GENERAL MANAGER and DEPUTY GENERAL MANAGERS means, respectively, each of

the four (4) Deputy General Managers of the JVC individually and collectively.

DFL means Dongfeng Motor Co., Ltd., a Sino-foreign joint venture enterprise duly

established by Dongfeng Motor Group Company Limited and Nissan China Company

Limited and validly existing under the laws of the PRC.

EFFECTIVE DATE is defined in Article 30.2(a).

ENVIRONMENTAL LAW means any PRC national, provincial, municipal, or local law,

judicial decision, regulation, rule, judgment, order, decree, injunction, permit

or governmental restriction or any agreement with any governmental authority,

whether now or hereafter in effect, relating to the environment, human health

and safety or to pollutants, contaminants, wastes or chemicals or any toxic,

radioactive, ignitable, corrosive, reactive or otherwise hazardous substances as

defined therein, wastes or materials.

ESTABLISHMENT DATE means the date on which the JVC is established as specified

in Article 3.1.

EVENT OF FORCE MAJEURE is defined in Article 26.1.

EXCHANGE RATE means the median of the US$ and RMB buying and selling rates

quoted by the People's Bank of China on the date the relevant payment or

transaction

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occurs.

EXECUTIVE DEPUTY GENERAL MANAGER means the Executive Deputy General Manager of

the JVC.

EXEMPTED TARGET is defined in Article 20.3.

FACTORY A means all the facilities, structures, buildings and improvements

constructed and/or currently under construction, which are located at Land I.

FACTORY B means all the facilities, structures, buildings and improvements

constructed and/or currently under construction, which are located at Land II.

FACTORY C means all the facilities, structures, buildings and improvements

constructed and/or currently under construction, which are located at Land III.

FACTORY means Factory A, Factory B and Factory C individually; and FACTORIES

means Factory A, Factory B and Factory C collectively.

FEASIBILITY STUDY REPORT means the feasibility study report prepared by the

Parties for evaluating the technical and commercial feasibility of establishing

an axle equity joint venture company in the Hubei Province, PRC.

FERC means a Foreign Investment Enterprise Foreign Exchange Registration

Certificate.

GENERAL MANAGER means the General Manager of the JVC.

INFORMATION means information of whatever nature and whether written, oral,

visual, pictorial, held electronically or otherwise, whether in whole or in

part.

JOINT VENTURE LAW means the Law of the People's Republic of China on Equity

Joint Ventures Using Chinese and Foreign Investment.

JOINT VENTURE REGULATIONS means the Implementing Regulations of the Law of the

People's Republic of China on Equity Joint Ventures Using Chinese and Foreign

Investment.

JVC means the PRC equity joint venture company established pursuant to this

Contract.

LAND I means that certain parcel of land (Land Lot Number: 9-13-14-2 and Land

Use Rights Certificate Number: 0913014-2) with a total area of approximately

134,319.10 square meters located on Jiefang Road, Xiangfan Municipality, Hubei

Province, which the JVC will lease from DFM pursuant to the Land Lease Contract.

LAND II means those certain parcels of land (Land Lot Number: 9-5-242 and

9-5-743 and Land Use Rights Certificate Number: 0905242 and 0905743) with a

total area of approximately 106,877.30 square meters located on No.1 Wudang

Road, Maojian District, Shiyan Municipality, Hubei Province, PRC, which the JVC

will lease from DFM pursuant to the Land Lease Contract.

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LAND III means those certain parcels of land (Land Lot Number: 9-8-9, 9-8-14,

9-8-219, 9-8-4, 9-8-1, 9-8-13, 9-8-2 and 9-8-220 and Land Use Rights Certificate

Number: 0908009, 0908014, 0908219, 0908004, 0908001, 0908013, 0908002 and

0908220) with a total area of approximately 318,915.30 square meters located on

Maojian Hall, Maojian District, Shiyan Municipality, Hubei Province, PRC, which

the JVC will lease from DFM pursuant to the Land Lease Contract.

LAND IV means that certain parcel of land with an area of approximately 3,000

square meters located on No. 68 Migong Road, Xiangfan Municipality, Hubei

Province, PRC, to which the JVC has exclusive use rights.

LAND means Land I, Land II, Land III or Land IV individually or Land I, Land II,

Land III and Land IV collectively.

LAND LEASE CONTRACT means a land lease contract entered into between DFM and DAC

on July 9, 2003.

NON-BREACHING PARTY is defined in Article 24.1(b).

OFFICE BUILDING means all the facilities, structures, buildings and improvements

constructed and/or currently under construction, which are located at Land IV.

PARTY means DFL or DANA individually; and PARTIES means DFL and DANA

collectively.

PERSON means any corporation, association, partnership, trust, body, entity,

individual, or enterprise legal person.

PRODUCTS is defined in Article 4.2(b).

PRC means the People's Republic of China, (including Mainland China, the Hong

Kong Special Administrative Region, Taiwan and the Macau Special Administrative

Region), but for the purpose of this Contract, refers only to Mainland China.

PRC FINANCIAL STATEMENTS is defined in Article 16.3(a)(iv).

QCDD means quality assurance capability for Q, competitive pricing advantage for

C, delivery time meeting the requirements of the production and operational

model for D, and research and development capability for D.

R&D CENTER is defined in Article 9.6(a).

REPRESENTATIVE means in relation to a Party, a director, officer, employee,

agent, servant or professional adviser of a Party or one of its Affiliates.

RMB means Renminbi, the lawful currency of the PRC.

SAFE means the State Administration of Foreign Exchange, its provincial branch

in Hubei Province or its local branch in Xiangfan Municipality, as appropriate.

SAIC means the State Administration of Industry and Commerce, its provincial

branch in Hubei Province or its local branch in Xiangfan Municipality, as

appropriate.

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SENIOR MANAGERS is defined in Article 12.1(b)(iii).

SPA means the Sale and Purchase Agreement for the acquisition by Dana of an

aggregate fifty percent (50%) of the registered capital of Dongfeng Axle Co.,

Ltd. entered into among DFL, Dongfeng Industry, DFM and Dana on the even date

herewith.

U.S. or U.S.A. means the United States of America.

US GAAP means Generally Accepted Accounting Principles applicable in the United

States of America.

US GAAP FINANCIAL STATEMENTS is defined in Article 16.3(a)(v).

US$ means United States Dollars, the lawful currency of the United States of

America.

WARRANTIES is defined in Article 5.4(b).

ARTICLE 2

PARTIES

2.1 CHINESE PARTY

The Chinese party to this Contract is Dongfeng Motor Co., Ltd. in English and

[CHINESE CHARACTER] in Chinese (DFL), a Sino-foreign equity joint

venture with limited liability duly organized and validly existing under the

laws of the PRC with its legal address at 84 Baiye Road, Wuhan Economic

Development Zone, Wuhan City, Hubei Province, PRC. The legal representative of

DFL is:

Name: MIAO WEI

Position: Director of Board

Nationality: Chinese

2.2 FOREIGN PARTY

The foreign party to this Contract is Dana Mauritius Limited in English and

[CHINESE CHARACTER] in Chinese (DANA), a corporation duly established

and validly existing under the laws of the Republic of Mauritius, with its legal

address at Level 6, One Cathedral Square, Pope Hennessy Street, Port Louis,

Mauritius. The legal representative of DANA is:

Name: Robert E. Pollock

Position: Director

Nationality: United States of America

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ARTICLE 3

THE JVC

3.1 ESTABLISHMENT OF THE JVC

In accordance with the Joint Venture Law, the Joint Venture Regulations and

other relevant laws and regulations of the PRC, the Parties hereby agree to

establish an equity joint venture company with limited liabilities (i.e. the

JVC) pursuant to the terms of this Contract and the Articles of Association. The

JVC shall be deemed to be duly established on the date set forth in the JVC's

business license issued by the SAIC (the ESTABLISHMENT DATE).

3.2 NAME AND ADDRESS OF THE JVC

(a) The name of the JVC shall be Dongfeng Dana Axle Co., Ltd. in English

andP. [CHINESE CHARACTER] in Chinese.

(b) The legal address of the JVC shall be: 10th Floor, Torch Building, Hi-Tech

Industry Development Zone, Xiangfan, Hubei Province, PRC.

JVC, or if at any time during the Company Term DFL ceases to be a Party to

this Contract or if DFL's equity interest falls below 50% of the

registered capital of the JVC or if there is a change in the shareholding

structure of or in the name of DFL or for any other reason, upon DFL's

request, the JVC shall forthwith change its name by removing the word

"Dongfeng" in English and "[CHINESE CHARACTER]" in Chinese from its name

without replacing it with any similar word or expression.

Upon the expiration of the Company Term or any early termination of the

JVC, or if at any time during the Company Term DANA ceases to be a Party

to this Contract or if DANA's equity interest falls below 50% of the

registered capital of the JVC or if there is a change in the shareholding

structure of or in the name of DANA or for any other reason, upon DANA's

request, the JVC shall forthwith change its name by removing the word

"Dana" in English and "[CHINESE CHARACTER]" in Chinese from its name

without replacing it with any similar word or expression.

3.3 LIMITED LIABILITY COMPANY

The JVC shall be a limited liability company. Each Party's liability shall be

limited to the amount of the JVC's registered capital subscribed by the Party,

and no Party shall have any other liability to the JVC or to any third party

jointly or severally in excess of such amount. The Parties shall share the

profits and, subject to the above, bear the risks and losses in accordance with

the ratio of their capital contributions as set out in Article 5.2.

3.4 LEGAL PERSON STATUS

The JVC shall be a legal person under the laws of the PRC.

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3.5 COMPLIANCE WITH LAW

All activities of the JVC shall be governed and protected by the relevant

published laws, regulations, decrees and rules of the PRC, and by the terms of

this Contract and the Articles of Association of the JVC. The Parties recognize

that in carrying out its obligations under this Contract, each Party shall also

be subject to and must abide by applicable laws, regulations, decrees and rules

of the jurisdiction of its establishment or its ultimate parent's establishment.

ARTICLE 4

PURPOSE, BUSINESS SCOPE AND SCALE OF PRODUCTION

4.1 PURPOSE

The purpose for the Parties to establish the JVC is to:

(a) establish the JVC to be a technologically advanced manufacturing

enterprise in the PRC of world class capabilities that will attain high

operating performance standards and will conduct activities of research,

design, manufacture and sale of Commercial Vehicle axle products and

specialty vehicle axle products, all of which are asbestos-free and meet

the environmental requirements of PRC and produce and sell related spare

parts and components as well as provide after-sales services; and

(b) allow the Parties to earn satisfactory profits.

4.2 BUSINESS SCOPE

(a) The business scope of the JVC shall be to design, manufacture, promote,

and sell Commercial Vehicle and specialty vehicle axle products and

related spare parts and components, to research and develop new

applications of such asbestos-free Commercial Vehicle and specialty

vehicle axle products for the domestic PRC market, and to provide

after-sales services and engineering support for such Commercial Vehicle

and specialty vehicle axle products, as well as to engage in other

business activities to promote the purpose and success of the JVC.

The detailed business scope of the JVC includes:

(i) to research, design, manufacture, develop, promote and sell

Commercial Vehicle axle products, specialty vehicle axle products

and related parts and components, but specifically excluding outdoor

power equipment products and off-highway vehicle axle products;

(ii) to sell in the China market the above-mentioned products and provide

after-sales services;

(iii) to sell in the Hong Kong Special Administrative Region, Taiwan, and

the Macau Special Administrative Region and in the international

market as provided in Article 10.2 below;

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(iv) to provide technical consultation services with respect to the axle

products and components of the JVC;

(v) to import from DANA and distribute in the PRC vehicle axle products;

(vi) to research, design, develop, produce, promote, handle, deal in,

sell or market only products that have no asbestos-containing

materials or products; and

(vii) to engage in other business activities to promote the purpose and

success of the JVC.

(b) Specifically, the axle products to be manufactured or sold by the JVC

shall be the following products (the PRODUCTS) for commercial vehicles

(trucks having a gross vehicle weight above 4 tons as well as medium and

large buses and coaches, collectively "COMMERCIAL VEHICLES") and specialty

vehicles (i.e., occupational vehicles, fire and rescue vehicles, dump

trucks, and cement trucks) but excluding outdoor power equipment products

or off-highway products:

(i) single and tandem drive axles;

(ii) non-driving steer axles;

(iii) pusher, tag and trailer axles;

(iv) drive steer axles;

(v) low floor bus axles;

(vi) brake components; and

(vii) hubs, drums and rotors.

light vehicles (having a gross vehicle weight less than 4 tons). DFL and

DANA will discuss forming a separate joint venture for the light axle

business and other matters relating to the development of the light axle

business.

4.3 ESTIMATED SCALE AND QUALITY OF PRODUCTION

(a) The Parties estimate that the JVC shall formally commence operation after

the issuance of the business license by SAIC, and the estimated annual

production for that year will be set out in the Feasibility Study Report.

Thereafter, the production capacity and scale of production may be

expanded subject to the conditions of increased market demand and other

economic conditions favoring expansion.

(b) In recognition of the importance of the development and production of

quality products to the success of the JVC, the JVC shall do its utmost to

ensure that the JVC shall obtain and continue in effect certification of a

world class quality system.

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4.4 LOCATION

(a) The JVC's operations will be located on the Land of the JVC and other

locations mutually agreed upon by the Parties. The JVC shall optimize the

process and logistics of the business of the JVC in the best interests of

both Parties.

(b) The JVC may from time to time, as it deems necessary and after approval by

the Board and the Approval Authority, establish branch organizations

within the PRC to promote the JVC, the Products, and to provide

information and advice to the customers of the JVC with respect to the

installation and uses of the Products.

ARTICLE 5

TOTAL INVESTMENT AMOUNT AND REGISTERED CAPITAL

5.1 TOTAL INVESTMENT AMOUNT

The total investment amount of the JVC shall be Renminbi One Billion Five

Hundred Million (RMB 1,500,000,000).

5.2 REGISTERED CAPITAL AND CONTRIBUTION RATIOS

The registered capital of the JVC shall be Renminbi Five Hundred Million

(RMB 500,000,000), of which DFL shall contribute Renminbi Two Hundred and Fifty

Million (RMB 250,000,000) accounting for fifty percent (50%) and DANA shall

contribute Renminbi Two Hundred and Fifty Million (RMB 250,000,000) accounting

for fifty percent (50%).

5.3 CONTRIBUTIONS OF THE PARTIES

(a) DFL shall contribute to the JVC 50% of the registered capital of DAC,

which has been subscribed and fully paid up by DFL as of the date hereof,

representing 50% of the registered capital of the JVC.

(b) DANA shall contribute to the JVC 50% of the registered capital of DAC,

which DANA has acquired from DFL, Dongfeng Industry and DFM pursuant to

the SPA and which has been subscribed and fully paid up by DFL, Dongfeng

Industry and DFM as of the date hereof, representing 50% of the registered

capital of the JVC.

5.4 REPRESENTATIONS AND WARRANTIES OF THE PARTIES

(a) DFL represents and warrants to DANA and the JVC with respect to DAC,

including without limitation all matters relating to its business,

finance, assets and properties those representations and warranties (DFL

REPRESENTATIONS AND WARRANTIES) set out in Schedule 8.1A of and other

representation and warranties and undertaking in the SPA.

(b) DANA represents and warrants to DFL and the JVC with respect to DANA's

acquisition of 50% of the registered capital of DAC pursuant to the SPA

those

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representations and warranties (DANA REPRESENTATIONS AND WARRANTIES) set

out in Schedule 8.1B of and other representation and warranties and

undertaking in the SPA.

For the purposes of this Contract, the DFL Representations and Warranties

and DANA Representations and Warranties are collectively referred to as

the WARRANTIES.

Establishment Date with reference to the facts then existing.

(d) The rights and remedies of any Party under this Contract including those

in respect of the Warranties, shall not be affected, and the other Party's

liabilities under this Contract shall not be released, discharged or

impaired, by (i) the completion of each Party's capital contributions to

the registered capital of the JVC, (ii) any investigation made into the

affairs of such other Party by that Party or any Affiliate of that Party,

or (iii) any event or matter whatsoever, other than a specific and duly

authorised written waiver or release by that Party.

(e) Without prejudice to Article 24 below, each of the Parties hereby agrees

to indemnify and keep the JVC and the other Party fully indemnified from

and against all claims, demands, actions, damages, losses, costs,

obligations, penalties, liabilities and expenses brought or made against

or suffered or incurred by the JVC and/or such other Party as a result of

or in respect of any breach by that Party of any Warranties applicable to

that Party.

(f) Both Parties agree that a claim for indemnity against one Party hereto

under Article 5.4(e) above, whether asserted by the JVC or by the other

Party, may be made by such other Party on behalf of itself and/or on

behalf of the JVC.

5.5 TIMING OF CAPITAL CONTRIBUTIONS BY THE PARTIES TO THE JVC

The date of capital contribution by the Parties to the JVC shall be deemed to be

the Completion Date as defined in the SPA. DFL's obligation with respect to its

capital contributions to the JVC shall be deemed fully discharged on the

Completion Date. DANA's obligation with respect to its capital contributions to

the JVC shall be deemed fully discharged on the date which DANA has made full

payment toward the Purchase Price (as defined in the SPA) in accordance with the

terms and conditions of the SPA.

5.6 ADDITIONAL FINANCING AND ALTERATION OF REGISTERED CAPITAL

(a) In addition to the registered capital, the JVC shall have the power to

borrow any additional funds which it requires and to mortgage its assets

in relation to such borrowing. Neither Party shall be obligated to lend

funds to the JVC or to guarantee loans to the JVC from third parties or

financial institutions. However, if a Party does agree to make such loans

or guarantees, such Party shall be entitled to be paid interest and/or

related fees, subject to the relevant provisions of the laws and

regulations of PRC(pound and the terms and conditions of such loans

or guarantees shall be comparable to the terms and conditions of

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loans or guarantees the JVC could have obtained from a third party on a

negotiated and arm's length transaction.

(b) During the Company Term, the JVC may alter its registered capital with the

unanimous agreement of the Board and the approval of the Approval

Authority. In the event that the Board unanimously agrees that if there is

a financial or operational need to increase the registered capital of the

JVC in excess of that stated in Article 5.2 above and either Party is

either unwilling or unable for whatever reason to contribute to such

capital increases, the other Party, in its discretion, in addition to its

own subscription to such capital increase, can subscribe to the

unsubscribed portion of such capital increase. The terms and conditions of

such capital increase and subscription shall be stipulated in a separate

agreement to be entered into between DFL and DANA, subject to the

unanimous agreement of the Board and the approval of the Approval

Authority.

(i) the Board shall make final decisions on all matters related to the

capital structure and funding requirement of the JVC;

(ii) Prior to the Completion Date (as defined in the SPA), DANA and DFL

will, based on recommendation from DANA's and DFL's financial team,

set the targets for additional fundings from the Parties for the

first 2 years after the JVC has been establishment;

(iii) Once the Board has decided that additional fundings from the Parties

are required, both Parties shall provide funding to the JVC up to

their pro rata shares of the aforesaid target by any of the

following options (A) a shareholder loan to the JVC, (B) a parent

guarantee supporting JVC's borrowing from any banks or financial

institutions, or (C) a standby letter of credit;

(iv) Each Party shall be entitled to choose any of the aforesaid options

and to substitute one option for the other at any time.

5.7 TRANSFER OF THE REGISTERED CAPITAL TO A THIRD PARTY OTHER THAN AN

AFFILIATE

(a) Subject to the provisions of paragraphs (b) and (c) of this Article 5.7

below, either Party may assign, sell or otherwise dispose of all or part

of its registered capital contribution to the JVC to a third party,

provided, however, that it first obtains the written consent of the other

Party and the approval of the Approval Authority if required.

(b) When a Party (the TRANSFERRING PARTY) wishes to assign, sell or otherwise

dispose of all or part of its registered capital contribution to the JVC

to a third party (other than a transfer by a Party to an Affiliate

pursuant to the provisions of Article 5.8 below (hereinafter the

TRANSFER), it shall notify the other Party in writing of (i) its wish to

make the Transfer, (ii) the interest it wishes to transfer, (iii) the

terms and conditions of the Transfer and (iv) the identity of

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the proposed transferee (the NOTICE). The other Party shall have a

pre-emptive right to purchase the whole of such interest on the terms and

conditions specified in the Notice.

of actual delivery of the Notice whether it will purchase the whole of the

interest to be transferred. If the other Party fails to notify the

Transferring Party within such sixty (60) day period that it will purchase

such interest, it shall be deemed to have agreed to the Transfer to the

proposed transferee specified in the Notice, and the Transferring Party

may assign, sell or otherwise dispose of such interest to such proposed

transferee, on the terms and conditions set out in the Notice. The Parties

shall cause the directors to unanimously agree to such assignment, sale or

other disposition. The Transferring Party shall provide the other Party

with a duplicate of the executed written agreement with the transferee

within fourteen (14) days of the execution of the agreement.

(d) If any Party fails to satisfy the following conditions during the transfer

of any part of its equity interest in the JVC, such transfer shall be

void:

(i) The contents of the transfer agreement actually executed by the

Transferring Party and the transferee shall be consistent with the

contents of the Notice;

(ii) The transferee has provided the non-Transferring Party a written

covenant letter (which shall be effective and in full force) with

the undertaking that the transferee shall fulfil the Transferring

Party's obligations under this Contract and shall be bound by this

Contract as if it were the original signing party thereof;

(iii) The approval by the Approval Authority and amendment registration

with registration authorities have been completed.

(e) If the other Party does not wish to or is unable to exercise its

pre-emptive right, it may not unreasonably withhold its consent to any

proposed Transfer by the Transferring Party. Notwithstanding any

provisions to the contrary, if the Transferring Party is DFL, DFL may not

transfer its equity interest in the JVC to any competitor of DANA which is

based in the PRC, Europe or North America, unless DANA has a direct or

indirect ownership interest in such competitor; and if the Transferring

Party is DANA, DANA may not transfer its equity interest in the JVC to any

competitor of DFL which is based in the PRC, unless DFL has an ownership

interest in such competitor. Moreover, if the capitalization, business

prospect, credit rating and such other business criteria of the proposed

transferee specified in the Notice as determined by an international

investment banking firm, are poorer than those of the Transferring Party,

the Transferring Party shall continue to be liable to the other Party for

the obligations of the Transferring Party hereunder after the Transfer.

5.8 TRANSFER OF THE REGISTERED CAPITAL TO AN AFFILIATE

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(a) Notwithstanding the provisions of Article 5.7, either Party may freely

assign its capital contribution to an Affiliate (which is not a competitor

(with respect to the Products) or owned by a competitor (with respect to

the Products) of the other Party or its Affiliates) after the following

conditions having been satisfied:

(i) such transferring Party shall guarantee that all of its

responsibilities and obligations under this Contract and under any

Ancillary Contracts to which it is a party shall remain valid and

unchanged as provided herein and therein, and

(ii) the Affiliate assignee shall be and have the ability to fully

perform all of such transferring Party's responsibilities and

obligations under this Contract; if any Ancillary Contracts to which

such transferring Party is a party have been assigned by such

transferring Party to its Affiliate assignee, the Affiliate assignee

shall fully perform all of such transferring Party's

responsibilities and obligations under such assigned Ancillary

Contracts; for those ancillary Contracts which have not been

assigned, such transferring Party shall continue to perform its

responsibilities and obligations under such non-assigned Ancillary

Contracts.

5.9 INVESTMENT CERTIFICATES

After the Completion Date, the JVC shall engage a major accounting firm

registered in the PRC as mutually agreed by the Parties to verify the

contributions and issue a verification report. Upon issuance of the verification

report by the accounting firm, the JVC shall issue an investment certificate to

each Party signed by the Chairman and Vice-Chairman of the Board, setting forth

the following: (i) the name of the JVC, (ii) the Establishment Date, (iii) the

name of the Parties and their respective capital contributions, (iv) capital

contribution date, (v) the date of the verification report so as to confirm the

amount contributed by each Party.

5.10 ENCUMBRANCE OF REGISTERED CAPITAL

No Party shall mortgage or otherwise encumber all or any part of its equity

interest in the JVC without the consent of the other Party.

5.11 ANCILLARY CONTRACTS

(a) On the date this Contract is signed, the following Ancillary Contracts are

also signed or initialed by the relevant party or the Parties jointly (on

behalf of the JVC):

(i) Articles of Association of the JVC for the establishment of the JVC

in the form of Appendix 5.11(a)(i);

(ii) Technology and Know-How License Contract, in the form of Appendix

5.11(a)(ii), between DANA CORPORATION and the JVC;

(iii) Technical Assistance Contract, in the form of Appendix 5.11(a)(iii),

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between DANA CORPORATION and the JVC;

(iv) Long Term Supply Agreement, in the form of Appendix 5.11(a)(iv),

between DFL and the JVC;

(v) DFL Delegation Agreement, in the form of Appendix 5.11(a)(v),

between DFL and the JVC;

(vi) DANA Delegation Agreement, in the form of Appendix 5.11(a)(vi),

between DANA CORPORATION and the JVC;

(vii) Labor Contract, in the form of Appendix 5.11(a)(vii);

(viii) Employee Manual, in the form of Appendix 5.11(a)(viii);

(ix) PRC Communist Party Organization and Labor Union Organization

Agreement, in the form of Appendix 5.11(a)(ix);

(x) Labor and HR Agreement, in the form of Appendix 5.11(a)(x); and

(xi) Letter of Guaranty, in the form of Appendix 5.11(a)(xi)

(b) On the first meeting of the Board, the Chairman or the General Manager as

authorized by the Board (as appropriate in accordance with Article 12.1(b)

below) shall sign on behalf of the JVC each of the Ancillary Contracts to

which the JVC is a party.

ARTICLE 6

RESPONSIBILITIES OF EACH PARTY

6.1 RESPONSIBILITIES OF DFL

In addition to its other responsibilities under this Contract, upon the request

of the JVC, DFL shall, at its own expense, use its commercially reasonable best

effort to:

(a) assist with:

(i) establishing the JVC, including submission of applications for

approval of this Contract and the Articles of Association of the JVC

to the Approval Authority and any other government authority whose

approval is required, provided that any expenses (fees) of any

Approval Authority shall be borne by the JVC;

(ii) registering the JVC with the SAIC;

(iii) issuance of the JVC's business license; and

(iv) registering the JVC with the relevant authorities including tax,

customs and foreign exchange authorities.

(b) assist the JVC in submitting the Ancillary Contracts to and obtaining the

necessary approvals or registrations in respect thereof from the relevant

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government authorities (if required under PRC law);

entered into between the JVC and such Affiliate as mutually agreed to by

the Parties to promptly execute such contract and, once such contract has

been executed, cause such Affiliate to fully perform its obligations

thereunder;

(d) arrange for the lease to the JVC of Land I, II and III and the use of Land

IV by the JVC as described in the first and second paragraphs of Article

8.1, handle registration procedures for the JVC's leasehold interests in

Land I, II and III and JVC's use rights in Land IV with the relevant

government department, and handle all other necessary procedures to ensure

that the JVC has the exclusive right to use the Land in conformity with

the scope of its operations for the Company Term, including any

extensions, and that the JVC is issued and receives the Land Lease

Certificate for Land I, II and III and required approval for Land IV from

the relevant government department evidencing such leasehold interests and

use rights;

(e) handle registration procedures for the JVC's ownership rights in Factory

A, Factory B, Factory C and the Office Buildings, and handle all other

necessary procedures to ensure that the JVC is issued and receives the

Real Estate Ownership Rights Certificates for Factory A, Factory B,

Factory C and the Office Buildings from the relevant government department

evidencing such ownership rights;

(f) assist the JVC in contracting for and obtaining the fundamental

facilities, services and utilities required by the JVC, including, but not

limited to, water, electricity, telecommunications, transportation, etc.,

conforming to the specifications and conditions set out in the Feasibility

Study Report, on a continuous uninterrupted basis, in quantities

sufficient to meet the JVC's full operational requirements and in line

with the practice in other comparable industrial joint ventures in

Xiangfan Municipality, at the lowest possible cost in RMB;

(g) if requested to do so, assist JVC in handling all employment and human

resources related matters and such as the recruitment of qualified PRC

management personnel, technical personnel and any other personnel

required;

(h) assist expatriate personnel of DANA CORPORATION and the JVC in handling

the necessary procedures for entry visas, work permits and traveling

arrangements, and to assist the JVC in arranging appropriate housing for

expatriate employees of the JVC, and hotel accommodations for foreign

personnel on temporary assignment to the JVC;

(i) assist the JVC to prevent management and technical personnel and workers

from disclosing any trade secrets of the JVC (including technology and

know-how licensed to the JVC by DANA CORPORATION);

(j) if requested to do so, assist the JVC in obtaining RMB and foreign

exchange loans from financial institutions in the PRC;

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(k) assist the JVC in applying for and obtaining all possible tax reductions

and exemptions and all other relevant investment incentives, privileges

and preferences available to the JVC under PRC law, including confirmation

on the tax holiday available to the JV (including all of its plants and

branches) and the designation of the JVC as an Encouraged Project, a

Technologically Advanced and Innovative Enterprise, and a

High-and-New-Technology Enterprise;

(l) if requested to do so, assist the JVC in applying for and being granted

all necessary approvals, permits, certificates and licenses required in

connection with safety, environmental matters (especially waste disposal),

and other matters regulated by governmental authorities;

(m) assist the JVC in establishing a good relationship with government

authorities and PRC domestic companies, including the existing customers

and suppliers of DFL;

(n) assist the JVC in formulating standards for recruiting, evaluating and

promoting staff and workers; and

(o) handle other matters as are entrusted to it by the JVC.

6.2 RESPONSIBILITIES OF DANA

In addition to its other responsibilities under this Contract, upon the request

of the JVC, DANA shall, at its own expense, use its commercially reasonable best

effort to:

(a) cause any Affiliate(s) of DANA which is a party to any contract to be

entered into between the JVC and such Affiliate(s) as mutually agreed to

by the Parties to promptly execute such contract and, once such contract

has been executed, cause such Affiliate shall fully perform its

obligations thereunder;

(b) assist the JVC in purchasing or leasing other machinery, equipment,

supplies, office appliances, means of transportation, communications

facilities and other materials required by the JVC from outside the PRC;

of the machinery and equipment to be imported by the JVC for the provision

of necessary technical personnel during the installation and commissioning

of the machinery and equipment, if the Parties deem such assistance to be

necessary;

(d) assist the JVC in recruiting expatriate management and technical

personnel;

(e) assist the JVC in formulating standards for recruiting, evaluating and

promoting staff and workers;

(f) assist the JVC in arranging foreign visas and accommodations for personnel

and directors of the JVC traveling abroad on JVC business;

(g) cause DANA CORPORATION to provide technology to support the JVC in

accordance with the Technology and Know-How License Contract, entered into

between DANA CORPORATION and the JVC;

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(h) assist the JVC, if being requested to do so and at the JVC's expense, in

arranging visits to the facilities of Dana and Dana's Affiliates, which

visits are, in Dana's opinion, conducive to the JVC's business and

operations; and

(i) perform other matters as are entrusted to it by the JVC.

ARTICLE 7

LICENSE OF TECHNOLOGY

(a) As of the date hereof, the JVC and DANA CORPORATION shall enter into the

Technology and Know-How License Contract in the form of Appendix

5.11(a)(ii), so that the JVC obtains the rights to use the advanced

technology and know-how of DANA CORPORATION for the production of the

Products. Appendix 1.1(A) of the Technology and Know-How License Contract

has set forth JVC's partial requirements with regard to technology. During

the valid term of the Technology and Know-How License Contract, DANA

CORPORATION shall, at the request of the JVC from time to time, license to

the JVC the requested technology, provided (i) that the Board agrees to

import such technology and that (ii) DANA CORPORATION owns such

technology. Subsequently, the JVC and DANA CORPORATION shall jointly make

relevant amendment to the aforesaid Appendix 1.1(A).

DFL and DANA both agree that the Technology and Know-How License Contract

is important for the success of the JVC.

(b) The license of technology and know-how is conditioned upon:

(i) DANA CORPORATION obtaining export licenses, if any are required,

from the government of the United States of America and any other

country whose export control laws may apply, and

(ii) applicable laws, regulations and executive orders of the PRC

government applicable to the license.

or of know-how and that the only grant of a license to technology and know

how is in the Technology and Know-How License Contract.

(d) The confidentiality obligations of the Parties with regard to such

technology and know-how licensed under the Technology and Know-How License

Contract are set forth in Article 21 below.

(e) In connection with the technical support by DANA CORPORATION to the JVC,

DANA CORPORATION or its relevant Affiliate(s) shall provide technical

assistance to the JVC pursuant to the Technical Assistance Contract in the

form of Appendix 5.11(a)(iii). All costs relating to the services to be

performed by DANA CORPORATION or its relevant Affiliate(s) under the

Technical Assistance Contract shall be dealt with by the parties thereto

in accordance with the terms and conditions thereof.

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ARTICLE 8

LAND

8.1 LEASE OF LAND USE RIGHTS BY THE JVC

DFL shall arrange for the lease to the JVC of Land I, Land II, Land III and with

an aggregate total area of 563,111.7 square meters as marked on Schedule 1I for

the Company Term with an option of renewal, the term and conditions of such

lease and option arrangement shall be further detailed in the Land Lease

Contract. DFL shall also arrange for the use by the JVC of Land IV for the

Company Term in accordance with the provisions hereof.

8.2 REGISTRATION OF THE LEASE OF THE LAND

DFL shall carry out formalities to register the lease of Land I, Land II and

Land III to the JVC pursuant to the Land Lease Contract and the use of Land IV

by the JVC with the relevant land and building administration authorities

recognizing the JVC's leasehold interests in Land I, Land II and Land III and

the JVC's use rights in Land IV. DFL shall ensure that the Land Lease

Certificates for Land I, Land II and Land III and the required approval for Land

IV evidencing the JVC's rights set forth in the preceding sentence is issued to

the JVC within thirty (30) days after the JVC has been issued its business

license.

8.3 REGISTRATION OF THE OWNERSHIP RIGHTS IN THE FACTORIES AND THE OFFICE

BUILDINGS UNDER THE JVC'S NAME

(a) Prior to the Establishment Date, DFL shall obtain one Real Estate

Ownership Rights Certificate for each of Factory A, Factory B and Factory

C and the Office Buildings, covering all buildings owned or used by DAC

which are located on Land I, Land II, Land III and Land IV respectively.

After the Establishment Date, DFL shall also carry out formalities to

Office Buildings under the JVC's name with the relevant land and building

administration authorities recognizing the JVC's ownership rights in

Factory A, Factory B, Factory C and the Office Buildings. DFL shall ensure

that the Real Estate Ownership Rights Certificates for Factory A, Factory

B, Factory C and the Office Buildings evidencing the JVC's rights set

forth in the preceding sentence are issued to the JVC within thirty (30)

days after the JVC has been issued its business license.

(b) In the event that any outside factors related to the Land renders the JVC

unable to continue to operate on the Land, or the terms and conditions of

the lease of any of the Land by DFM to the JVC are not generally

consistent with those for the lease of land by DFM to DFL or the terms and

conditions of the use by the JVC of Land IV are not generally consistent

with the current terms and conditions of use, DFL shall, at the JVC's

request, buy back the Factory or the Office Buildings on the Land so

affected at the then book value of such Factory or such Office Buildings.

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8.4 LAND USE FEE AND LAND USE TAX

As agreed in the Land Lease Contract and between the Parties, DFL shall ensure

that the JVC will have complete and exclusive use and occupancy of the Land and

that the JVC will at all times during the term of the lease, have the exclusive,

peaceful and quiet enjoyment and possession of all of the Land without any

manner of claim or hindrance from any parties and free and clear of any claims

or rights of interest or molestation of any kind relating to such quiet

possession and use. Pursuant to the provisions of Article 8.3 above, DFL shall

also register the ownership rights in the Factories and the Office Buildings

under the JVC's name clear and free of any mortgage, pledge, lien, charge,

encumbrance, assignment, hypothecation, priority, security interest, option,

warrant, title retention, preferential right, trust arrangement, security

agreement or arrangement, or other third party claims or rights (including

rights of pre-emption) of any nature whatsoever and with land use fees, land use

taxes and land registration fees paid in full by DFM. In the event that DFM

defaults in the payment of any fee, tax or other payment to be made by it which

affects the JVC's right to use any of the Land or the JVC's ownership interests

in the Factories and/or the Office Buildings, the JVC may (but shall not be

obligated to) pay and discharge such fee, tax or other payment on behalf of DFM

and shall be entitled to recover any sum so paid as a debt and/or claim for

damages from DFM.

8.5 SUPPLY OF UTILITIES AND TELECOMMUNICATIONS FACILITIES

If the JVC, as a High-and-New-Technology Enterprise, does not have a sufficient

supply of utilities, including telecommunications facilities, DFL shall cause

the local Planning Commission, local Utilities Bureau, Power Supply Bureau,

Telecommunications Bureau and other relevant departments to review the situation

and give priority to the JVC in the supply of the utilities in accordance with

the State Council Regulations Encouraging Foreign Investment and pursuant to the

approved Feasibility Study Report. The prices for the utilities shall be in RMB

and shall be at the lowest possible price.

8.6 ENVIRONMENTAL STATUS OF FACTORIES AND LAND

(a) DFL's representations and warranties with respect to the Factories, the

Office Buildings and the Land are set out in Part B and Part C of Schedule

8.1A of the SPA. DFL shall be, subject to the provisions of the SPA,

responsible for any and all environmental liabilities arising in

connection with or in any way relating to DFL (or any predecessor of DFL

or any prior occupant of the Land), the Land or any activities or

operations occurring or conducted at the Land (including, without

limitation, offsite disposal), whether accrued, contingent, absolute,

known and unknown, determined, determinable or otherwise, which (i) arise

under or relate to any Environmental Law and (ii) relate to actions

occurring or conditions existing on or prior to the Establishment Date.

(b) DFL shall ensure that, by the date immediately prior to the Establishment

Date, there will be no asbestos containing materials in any of the

Factories, the Office Buildings or on any of the Land, whether contained

in parts and components, inventories, products (whether finished or

semi-finished), machinery and equipment, or building materials, or

otherwise. DFL shall

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remain liable for any and all asbestos claims at all time.

ARTICLE 9

MAJOR OPERATING PRACTICES OF JVC

9.1 SUPPLY OF VEHICLE AXLE PRODUCTS TO DFL

DFL shall purchase from the JVC and cause its Affiliates to purchase from the

JVC pursuant to the Long Term Supply Agreement all of the Commercial Vehicle,

specialty vehicle and light vehicle axle products required by them and which the

JVC can supply, ***.

9.2 PURCHASE AND SUPPLY OF COMPONENTS

DFL shall, and shall cause its Affiliates to, pursuant to the agreements entered

into between DFL and/or its Affiliates and the JVC and/or past practice,

continue to supply to the JVC raw materials and components for Commercial

Vehicle, specialty vehicle and light vehicle axle products required by the JVC

based on the following principles:

(a) ***

(b) DFL's plants and its wholly owned subsidiaries, which supply parts and

components to the JVC, will use their best efforts to continue to improve

their QCDD level and competitiveness in the same matter as what the JVC

has agreed under the Long Term Supply Agreement.

their QCDD level and competitiveness so as to support the JVC's cost

reduction targets.

(d) ***

(e) ***

(f) ***

9.3 IMPORT OF CERTAIN SPECIALTY VEHICLE AXLE PRODUCTS OF DANA

The specialty vehicle axle products that the JVC does not or can not manufacture

may be supplied by DANA to meet the requirements of the Chinese market in order

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develop market share in the PRC and to provide a full range of vehicle axle

products to customers of the JVC in the PRC. ***

9.4 ETHICS CODE

The JVC shall adopt the ethics code set forth in Appendix _-_ "Standards of

Business Conduct", which will be part of the Employee Manual.

9.5 DELEGATION FEES

(a) The delegation fees for the General Manager of the JVC shall be the

delegation fees for a Deputy General Manager multiplied by a factor of 1.6

or such other number mutually agreed to by the Parties.

(b) The delegation fees for the Executive Deputy General Manager of the JVC

shall be the delegation fees for a Deputy General Manager multiplied by a

factor of 1.4 or such other number mutually agreed to by the Parties.

for the DFL Delegates holding the comparable position multiplied by a

factor of 1.5. Except for the aforesaid delegation fees, the JVC shall not

make any payment to the delegating party for any other expenses relating

to the Delegates.

9.6 R&D CENTER

(a) Both Parties undertake that, as soon as the JVC has been established, it

shall start to establish a R&D Center for the Products (the R&D CENTER),

which will be independent of both Parties.

(b) The purpose of the R&D Center is endeavoring to satisfy all the

requirements for the Products in the PRC market.

technical demand, develop and design, testing and verification,

application and customization, and other technical research activities for

the Products.

(d) The scope of the R&D Center includes the Products as defined in Article

4.2(b) above and other products which may be added to the JVC's product

list by mutual agreement of the Parties.

(e) Both Parties confirm the target dates for the establishment of the R&D

Center in stages as follows:

(i) Within 2 years after the Establishment Date, all initial hardware of

the R&D Center shall be set up; initial staffing shall be completed;

and the R&D Center shall be operational;

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(ii) By 2010, the basic functions of the R&D Center shall be established;

the focus of the R&D Center shall be to ensure that the Products are

competitive in the PRC market;

(iii) Following 2010, the R&D Center shall endeavor to become the

industrial leader with regard to the technical aspects of the

Products.

(f) Both Parties confirm that the R&D Center and DANA CORPORATION's R&D center

shall supplement and support each other and share resources together. In

order to fully utilize resources, the JVC may have access to Dana

CORPORATION's global information regarding the Products through DANA

CORPORATION's R&D center in Kalamazoo (or its successors) which will

include without limitation development and testing theories and methods

and standards and results and the relevant data. DANA CORPORATION shall

provide technical support to the JVC.

(g) Both Parties confirm that the initial details of the R&D Center shall be

stipulated in Schedule 9.6.

(h) The JVC and R&D Center should be entitled to receive various preferential

tax and financial treatments in accordance with the relevant PRC laws and

regulations for its R&D Center.

9.7 SALES ACTIVITIES

(a) The JVC shall have its own sales force to sell the Products in the PRC,

and will sell Products to all OEMs and customers for spare parts in the

PRC market.

(b) The JVC's sales activities shall be governed by the principles set forth

in Article 10 below.

9.8 INFORMATION TECHNOLOGIES

The JVC shall adopt the IT policies prepared insofar as reasonably practical to

incorporate the principles of both DANA's and DFL's IT policies, which shall be

approved by the Board.

9.9 MARKETING POLICY

Given the demand for high quality Commercial Vehicle axle products and related

products in the PRC, the Parties contemplate that the bulk of the Products will

be sold for use in the domestic PRC market. The JVC shall establish a marketing

strategy for sale of Products to OEMs and in the after-market as approved by the

Board.

The JVC shall assure that all sales of its Products to any entity and all

associate business practices are carried out in compliance with all export and

foreign trade control laws and regulations imposed by the country of import and

the country of export.

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9.10 ENVIRONMENTAL SYSTEMS

(a) The JVC must comply with the relevant requirements specified in the PRC's

environmental laws in relation to the Land, the Factories and the Office

Buildings. The JVC shall also develop a plan for the JVC to, within a

reasonable time frame, meet DANA CORPORATION's worldwide standards on

environmental protection in relation to the Land, the Factories and the

Office Buildings.

(b) The JVC shall obtain the ISO 14001-1996 Environmental Management System

certification within two (2) years from its commencement of operations.

9.11 BOARD'S REVIEW OF DANA CORPORATION'S TECHNICAL SUPPORT

The JVC board will periodically review the progress of DANA CORPORATION in

meeting its objectives and obligations of providing technology, technical

support, and support in connection with the establishment of the R&D Center, in

accordance with the provisions of this Contract, the Technology License Contract

and Technical Assistance Contract. If DFL has concerns or evidence indicating

that DANA CORPORATION has not fully performed its obligations, DFL shall have

the right to submit a report to the Board and ask the Board for a review. The

Board shall convene a board meeting within sixty (60) days to review any report

submitted by DFL and determine the merits of DFL's submission. If the Board

determines that DANA CORPORATION is not substantially meeting its objectives and

obligations, the Board shall adopt a resolution requiring DANA CORPORATION to

respond and/or rectify the situation within commercially reasonable time. If,

the Board determines that DANA Corporation's response and/or rectification have

not satisfactorily addressed the Board's resolution, it shall have the right to

make equitable adjustment to the payment of the royalty by the JVC to DANA

CORPORATION pursuant to the Technology and Know-how License Contract based on

the seriousness of situation.

9.12 TRADEMARK LICENSES

DFM and DANA CORPORATION will license to the JVC their relevant trademark(s)

with respect to the Products on terms and conditions of separate royalty free

trademark license contracts, containing usual provisions regarding quality

control, style and limits on the use of such marks, and termination of such

license if the ownership interest of the party licensing such trademark(s) in

the JVC falls below an agreed level all to be negotiated and entered into

between the parties thereto.

ARTICLE 10

MARKETING AND SALES OF PRODUCTS

10.1 DOMESTIC SALES AND AFTER-SALES SERVICES

The JVC may sell the Products in the PRC domestic market to customers in the OEM

market and after-market and provide after sales services.

10.2 EXPORT SALES OF THE JVC'S PRODUCTS

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(a) The JVC will focus its marketing and sales activities on the domestic PRC

market. ***

(b) ***

10.3 PAYMENT POLICY

The JVC's payment policy will be decided by the Board and implemented by the

JVC.

10.4 BRANCH OFFICES

The JVC may, as it deems necessary and after approval by the Board, establish

branch organizations within the PRC to promote the sale of the Products, and to

provide information, advice and after sales service to customers of the JVC.

10.5 FUTURE EXPORT SALES OF GEAR PRODUCTS BY JVC

(a) The JVC will support DANA CORPORATION's global sourcing requirement for

components.

(b) DANA CORPORATION will use the JVC as one of its manufacturing bases.

(d) ***

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ARTICLE 11

THE BOARD OF DIRECTORS

11.1 DATE OF ESTABLISHMENT OF THE BOARD OF DIRECTORS

The JVC shall establish a board of directors on the date the JVC is registered

and issued its business license by SAIC.

11.2 COMPOSITION OF THE BOARD

(a) The Board, including the Chairman and Vice-chairman, shall consist of

eight (8) directors, among which four (4) directors shall be appointed by

DFL and the other four (4) directors shall be appointed by DANA. During

the first eight (8) years immediately following the establishment of the

JVC, the Chairman of the Board shall be appointed by DFL, and the

Vice-Chairman of the Board shall be appointed by DANA. During the four (4)

years immediately after the first eight (8) years following the

establishment of the JVC, the Chairman of the Board shall be appointed by

DANA and the Vice-Chairman of the Board shall be appointed by DFL.

Thereafter, the Chairman and Vice-Chairman of the Board shall each be

appointed by DFL and DANA alternately for a term of four (4) years.

(b) Each director will be appointed for a term of four (4) years and may serve

consecutive terms if reappointed by the originally appointing Party.

sending written notice to the JVC with a copy to the other Party. If a

seat on the Board is vacated for any reason, the Party that originally

appointed such director may appoint a successor to serve out the

director's term.

(d) Directors shall not be paid a salary by the JVC. Any person holding a

position in the JVC shall not be a director of the Board of the JVC.

11.3 DECISIONS OF THE BOARD OF DIRECTORS

(a) The Board is the highest authority of the JVC.

(b) The Board shall decide all major issues concerning the JVC. Decisions of

the Board involving the following matters shall require unanimous approval

of all members of the Board present at the meeting (in person or by

proxy):

(i) amendments to the Articles of Association;

(ii) early termination and dissolution of the JVC;

(iii) increase or reduction of the JVC's registered capital or any

assignment or sale by one Party of all or a portion of its

registered capital in accordance with the provisions of Articles 5.7

and 5.8;

(iv) the merger of the JVC with any other economic organization or the

division of the JVC; and

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(v) providing guarantee for a third party in the JVC's name or using

the JVC's assets.

approval of a simple majority of all members of the Board present at the

meeting (in person or by proxy) with at least two (2) affirmative vote

from each Party:

(i) review and approval of the annual report;

(ii) appointment and dismissal of the external auditor of the JVC;

(iii) review and approval of the annual PRC Financial Statements;

(iv) allocation to the reserve fund, bonus and welfare fund for staff

and workers of the JVC and the enterprise development fund of the

JVC and decision regarding the utilization of the same;

(v) review and approval of medium and long term plans;

(vi) review and approval of the one to three years capital investment

for fixed assets;

(vii) appoint and dismissal of the Senior Managers of the JVC, changes to

the job descriptions and organizational structure of the Senior

Managers, and major decisions with regard to their wages and other

terms of employment;

(viii) review and approval of the annual budget;

(ix) change or amend the profit distribution policy set forth in Article

16.7;

(x) any agreements for borrowings (loans and other credit facilities)

by the JVC;

(xi) capital expenditures on fixed assets of the JVC as follows:

- any individual capital expenditure approved within the annual

budget with a value above RMB 1,000,000, or

- any capital expenditure not approved within the annual budget

where the aggregate value of the project is above RMB

500,000;

(xii) the sale of fixed assets of the JVC as follows:

- the sale of any individual fixed asset approved within the

annual budget with a book value above RMB 2,000,000 or

- the sale of any individual fixed asset not approved within

the annual budget with a book value above RMB 1,000,000;

(xiii) the establishment of the JVC's management and staff and worker

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*** indicates where a confidential portion has been omitted and filed separately

with the Commission

organization(s) and material changes therein, all in accordance

with the relevant PRC laws and regulations;

(xiv) the formulation of important JVC rules and regulations;

(xv) approving any contract, or the modification of any contract,

between the JVC and either Party and/or any of its Affiliates

other than the Ancillary Contracts, with a value exceeding RMB

10,000,000 or with term of more than one year, and all other

contracts, or the modification of any contract, between the JVC

and either Party and/or any of its Affiliates shall be approved

jointly by a Delegate from each Party;

(xvi) any transfer of the granted land use rights to the Land and

ownership rights in the Factories or in the Office Buildings;

(xvii) any investment in any other company;

(xviii) other important matters which concern the rights and interests of

the JVC as decided by the Board; and

(xix) all other matters to be decided by the Board as stipulated in this

Contract.

Any item already contained within the approved annual budget shall not

require a separate affirmative vote of the Board according to this Article

11.3 except for the requirement of additional affirmative votes on the

items stipulated in Articles 11.3(c)(xi) and (xii). The Board may, by a

resolution, change the figures set forth in items (xi), (xii) and (xv) of

this Article 11.3(c) from time to time.

11.4 CHAIRMAN

(a) The Chairman will be the legal representative of the JVC and shall sign

legal documents authorized by the Board. The Chairman will call and

preside over meetings of the Board. The Chairman shall fulfill his or her

responsibilities within the authorities delegated by the Board as provided

hereunder. The Chairman shall be responsible for the operation of the

Board as authorized by the Board. The General Manager shall be responsible

for the operation of the JVC and shall be directly responsible to the

Board.

(b) If the Chairman grants authorization or is unable to perform his or her

responsibilities due to health reasons only, the Vice Chairman may act in

his or her place to perform his or her responsibilities.

11.5 MEETINGS OF THE BOARD

(a) The Board will determine the number of times it will meet per year,

provided that the Board shall meet at least once each year in accordance

with PRC law. The meetings will be held at the place where the JVC is

located, but may also be held at such other places within or outside the

PRC as the Board decides. The first Board meeting shall be held within one

(1) month after the date of issuance of the JVC's business license.

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*** indicates where a confidential portion has been omitted and filed separately

with the Commission

(b) A Board meeting requires a quorum of six (6) Board directors.

attend all duly convened Board meetings in person or by proxy. If a

director is unable to attend a meeting of the Board:

(i) he or she may authorize another person by written proxy to attend

and act on his or her behalf and the director will be deemed to be

present for purposes of a quorum;

(ii) the designated representative may vote in the place of the director,

and if such designated representative holds more than one written

proxy, he may vote in the place of more than one director; but

(iii) if the absent director does not appoint a representative, he or she

shall be deemed to have waived the right to vote at the meeting;

(iv) each director, including the Chairman and Vice-Chairman, shall have

only one (1) vote with no deciding vote in case of a tie.

(d) Upon the written request of three (3) or more directors (which shall

specify the matters to be discussed), the Chairman (or the Vice Chairman,

if the Chairman grants authorization or is unable to perform his or her

responsibilities due to health reasons only) shall convene an interim

meeting of the Board within three (3) months of the written request for

such interim meeting.

(e) If the Chairman of the Board does not call a meeting according to Articles

11.4(a) and 11.5(d), the Vice-Chairman shall be entitled to call and

preside over the Board meeting.

(f) Regular meetings of the Board may be held without notice if the time and

place of such meetings have been set in advance by the Board. Not

withstanding the preceding sentence, the agenda of such meetings and other

relevant information must be sent by the Chairman to the directors by

facsimile, email, courier or registered airmail or delivered personally

not less than sixty (60) days nor more than ninety (90) days before such

meetings. Notice of time and place of interim meetings of the Board and of

regular meetings for which time and place have not been set by the Board

shall be sent by the Chairman or his/her designee to the directors by

facsimile, email, courier or registered airmail or delivered personally

not less than sixty (60) days nor more than ninety (90) days before such

meeting. Such notice shall be in English and Chinese and shall contain the

agenda of the meeting.

(g) The Chairman shall amend the agenda of the meeting upon the written

request of three (3) or more of the directors of the JVC specifying the

matters to be discussed, received by the Chairman at least thirty (30)

days prior to the scheduled meeting, or at least fifteen (15) days prior

to the scheduled meeting if the requested amendment to the agenda

concerning an emergency situation related to environment, health and

safety that endangers the staff and workers of the JVC, or adversely

affects the properties, business and operations of the JVC. The Chairman

shall promptly inform the other directors of any such

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*** indicates where a confidential portion has been omitted and filed separately

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