International Business Environment May 3, 2010 Evelyn Furia, Kristen Gunthardt, Ben Kelly, Erica Pilarski, and Amy Schatz

Johnson Controls Milwaukee-based auto parts and commercial building parts manufacturing company Position Cutting edge lithium battery innovator Leading producer of electric car batteries Research Investments Stimulus grant for lithium research facility in U.S. Increased presence in China FDI Proposal Secure affordable lithium supply as Johnson Control’s dependence on this raw material is expected to increase Make a long-term investment to improve vertical integration of operations $125 MM investment in China’s Tibet Mineral Company for a 50% stake 22 Overview Risk & Reward Lithium Market Political Issues Costs & Currency Political Issues Costs/ Currency Risks & Reward The JV

Lithium Subsidiary Investment Estimate o Based on capital costs of other companies’ lithium projects o Capital costs range from $90MM up to $500MM o Vertical integration of operations into lithium ion manufacturing o Hedging risks of increased demand by securing raw material supply through joint venture. Investment could cost between $125MM and $477MM USD Lithium Subsidiary Investment Estimate o Based on capital costs of other companies’ lithium projects o Capital costs range from $90MM up to $500MM o Vertical integration of operations into lithium ion manufacturing o Hedging risks of increased demand by securing raw material supply through joint venture. Investment could cost between $125MM and $477MM USD Tibet Mineral Development Corp. Shares Price/Share (Y) ￥ Market Cap (Y) ￥ 6, Exchange Rate (Y/USD) ￥ Market Cap (USD) $ % Stake (worst case) $ Johnson Controls ($MM)2009 Assets $ 24,088 Liabilities $ 14,749 Equity $ 9,339 Sales $ 28,497 Costs of Goods $ 24,948 Gross Profit $ 3,549 Other Costs $ (3,847) Net Income $ (338) Investment Cash Flow $ (828) Current Ratio 1.13 Quick Ratio 0.95 Cash Ratio 0.09 Debt Ratio 0.16 Debt-to-Equity Ratio 0.42 Interest Coverage (1.33) Johnson Controls Financial Position 2009 recession led to net loss of $338 MM Reduced investment expenditures resulted in higher cash position. Investment expenditures typically exceed $1B Tibet Mineral Development Corp Parent holding company of target lithium subsidiary, Shenzhen ZBY Lithium Trading Company Holds exclusive mining rights to brine lithium extraction from Zhabuye Salt Lake in Tibet $954 MM USD market cap 33 Overview Risk & Reward Lithium Market Political Issues Costs & Currency Political Issues Costs/ Currency Risks & Reward The JV

4 Supplier Power (Medium) Countries offering the mineral rights Difficult to obtain rights open Abundance of lithium reserves Threat of Substitutes (Medium) Other battery types as standards evolve Other power sources Recycled batteries Threat of Entry (High) Simple technology Capital requirements are moderate No product differentiation Government legal barriers Economies of scope with other lithium bi- products Buyer Power (Low) No standardized market for lithium trading Less visibility in the market and lack of information Many uses, increasing demand I Industry Rivalry (Low, but high potential to increase) Three main suppliers and many smaller suppliers Different cost structures in the industry 4 The JV Overview Risk & Reward Lithium Market Political Issues Costs & Currency Political Issues Costs/ Currency Risks & Reward

Timing First mover advantage to secure dependable lithium supply Government incentives for green technologies Lithium Reserves in China 3 rd largest supply of brine reserves in the world Higher processing costs lead to reliance on lithium imports Risks to Investing in Tibet Political & PR risks Geographic challenges Foreign Direct Investment in China Johnson Controls has China manufacturing facilities and experience operating in country FDI would be in form of a Cooperative Joint Venture, which provides limited liability and profits/risks can be established under contract. 55 The JV Overview Risk & Reward Costs & Currency Political Issues Costs/ Currency Risks & Reward Lithium Market

Supply and Demand Demand is predicted to rise Hybrid electric vehicles Alloys, pharmaceutical, etc. Supply is also predicted to rise Excess capacity Higher cost capacity coming back online Relatively stable prices Currency Risk Less risk in changing value of the Yuan – pegged to the dollar Currency value of major producing country currencies can effect lithium price Balance of payments weighted by market share Argentina – above 0 since 2001 Chile – stable around 0 since 2001 Australia – deficit continues Downward pressure on prices due to currency valuations Lithium accounts for only ~3% of total battery costs 66 The JV Overview Risk & Reward Lithium Market Political Issues Costs & Currency Political Issues Risks & Reward

Risk or Reward InvestDon’t Invest Secure supply of raw materialX Create low cost incentives for suppliersX Unpredictable future demand for Hybrid and Electric VehiclesXX Limited supply of lithium isn’t a large risk as the lithium-ion battery market expands X Emerging industry standards and uncertainty that lithium will be the battery input of choice X Proportional cost of raw lithium within overall battery manufacturing process is low (3%) X Limited lithium price fluctuation and production of other minerals from brines may pose risk X Tibet / Chinese political regulations, corruption and instabilityX Lack of infrastructure in TibetX At this time, Johnson Controls should not invest in Tibet Mineral Company 77 The JV Overview Risk & Reward Lithium Market Political Issues Costs & Currency Political Issues Costs/ Currency Lithium Market