Tear in drivers seat - Advice Wanted

[*MAD DOG*]

I got my Yairs YRX (Top of the range model in Australia) in December 2007, a couple months shy of 3 years now. I have just now noticed that my drivers seat has a tear in it, it's obvioulsy worn over time.

Now the warranty my car came with is "The warranty period for all new Toyota vehicles is 3 years or 100,000 kilometres, whichever comes first. The actual commencement date of the warranty is shown on the New Vehicle Information Statement on the inside front cover of your Warranty and Service Handbook. This will be the date the vehicle is delivered to its first owner."

The seat is height adjustable, premium fabric and has an airbag in it so I'm not going to put a cover on it.

Please note I also got paint protection, fabric protection and tint from the dealer.

Before I take my car down to Toyota what do you guys think?
Will they repair the seat?
Replace it?
Laugh at me?
All of the above?
Or even worse make me pay for it?

Here are some pics.