Agreement on the Irrevocable Undertaking, dated February 15, 2021, among Sven Schulz, Sven Schulz Group GmbH, BorgWarner Inc. and Blitz F21-842 AG

The Shareholder’s Shares are held by the Shareholder for its own risk and account and are not subject to any shareholders’ voting, trust, pooling, consultation or similar agreements or arrangements.

As of the Signing Date, the Shareholder’s entering into this Agreement and the performance of the Shareholder’s respective obligations hereunder neither require any approval or consent by any court, governmental authority or other third party (except for approvals or consents which are Offer Conditions) nor violate any judicial or governmental order or decree or any applicable law.

To the Knowledge of the Shareholder, on the Effective Date and on the date of Offer Completion, all notice and disclosure duties of the Shareholder under Section 20, 21 of the AktG, Section 33 et seq. of the Securities Trading Act (Wertpapierhandelsgesetz, WpHG), if applicable and as amended from time to time, have always been discharged in a timely and proper manner.

Schedule 4.1(k) contains a complete and correct list of all agreements between (i) the Target Group on the one hand and (ii) the Shareholder, S and/or their respective Affiliates, any person close (nahestehend) to the Shareholder, S and/or their respective Affiliates or any of their direct or indirect shareholders within the meaning of IAS 24 or affiliated companies within the meaning of section 15 et. seq. of the AktG of such persons (the persons under this clause 4.2(d)(ii) collectively the Related Persons) on the other hand (collectively the Related Persons Agreements).

Schedule 4.1(l) contains a complete and correct list of all intellectual property rights relating to the business of the Target Group (including but not limited to patents, trademarks as well as copyrights) and applications for registration of intellectual property rights that are owned or held by S or the Shareholder rather than by the Target Group (collectively the Shareholder IP).

To the Knowledge of the Shareholder, between 30 September 2020 and the Effective Date, the business operations of the Target have been conducted by the management of the Target in the ordinary course of business, in accordance with the standard of care of a prudent merchant (Sorgfalt eines ordentlichen Kaufmanns) and in substantially the same business manner as before, i.e. in a manner that would not materially adversely affect the business operations of the Target Group taken as a whole.

To the Knowledge of the Shareholder, the consolidated audited financial statements of the Target Group as of 31 December 2019 (Target’s Annual Report 2019) submitted to BW were prepared in accordance with generally accepted accounting principles and present a true and fair view of the financial position of the Target Group, within the meaning of section 264 para. 2 of the Commercial Code (Handelsgesetzbuch, HGB), of the net assets position (Vermögenslage), financial condition (Finanzlage) and results of operation (Ertragslage) of the Target Group as of the balance sheet date referenced therein. To the Knowledge of the Shareholder, the unaudited consolidated financial statements of the Target Group as of 30 September 2020 present a true and fair view of the financial position of the Target Group as of the relevant dates as applicable and of its financial performance and its cash flows in accordance with International Financial Reporting Standards (IFRS). To the Knowledge of the Shareholder, (i) the Target has made public all material information required to be made public by applicable law and regulation that is relevant for the valuation of the Target Shares since the publication of Target’s Annual Report 2019 and (ii) no information made public by or on behalf of the Target since the publication of Target’s Annual Report 2019 (x) contains any untrue statement of a material fact or (y) omits to state a material fact required to be stated therein, provided that the material fact in (x) or (y), as the case may be, is relevant for the valuation of the Target Shares. Any violations of the statements in this clause 4.1(n) shall only constitute a breach of this Shareholder’s Guarantee if the circumstances or occurrences underlying the breach have, individually or collectively, a material adverse effect on the Target Group taken as a whole.

To the Knowledge of the Shareholder, each member of the Target Group is in compliance in all material respects with all applicable Legal Requirements other than where such non-compliance would not have a material adverse effect on the Target Group taken as a whole. To the Knowledge of the Shareholder, since 1 January 2016, no member of the Target Group has received any notice from any governmental authority or any other person of any alleged violation or noncompliance of any Legal Requirements other than where such non-compliance would not have a material adverse effect on the Target Group taken as a whole. As used herein, the term “Legal Requirements” means all laws and regulations which are relevant for the business operations of the Target Group, including anti-bribery and anti-money laundering laws and regulations and economic or trade sanctions, articles of association, by-laws or other equivalent constitutional documents as well as orders, decrees or judgments of any court or any governmental or regulatory authority in any jurisdiction which applies to and are relevant for the business operations of the Target Group.

Knowledge of Shareholder

In this Agreement, the Shareholder shall be deemed to have had Knowledge of the Shareholder if, as of the Effective Date, S and any of the Shareholder’s management had actual knowledge (positive Kenntnis). For the avoidance of doubt, no attribution of knowledge (Wissenszurechnung) under the principles of Section 166 para 1 German Civil Code (BGB) with respect to matters that are known or could have been known by employees of the Target Group shall apply.

No Further Representations

The Shareholder makes no representations and warranties or guarantees other than those expressly and conclusively set forth in clause 4.1. The Parties agree that the statements contained in clause 4.1 shall not constitute a quality guarantee concerning the purchase object within the meanings of Sections 443 and 444 of the German Civil Code (BGB) (keine Garantie für die Beschaffenheit oder Haltbarkeit des Kaufgegenstandes).

S makes no representations and warranties or guarantees whatsoever under this Agreement.

Remedies

If the Shareholder is in breach of any its guarantees set forth in clause 4.1 or is otherwise in breach of its obligations under this Agreement, the Shareholder shall, at the Shareholder’s discretion, either

no later than twenty (20) Business Days after being notified by BW of such breach in writing, put the Acquirors in such position it would have been in without such breach ((restitution in kind – Naturalrestitution) or

if and to the extent such restitution in kind is impossible or the Shareholder refuses such restitution or if such restitution is not achieved within twenty (20) Business Days after the Shareholder having been notified of such breach, pay to Bidder (as reduction of the Offer Consideration) monetary damages (positives Interesse), within the meaning of Section 249 et seq. BGB, arising out of such breach, including any foreseeable consequential or indirect damages (vorhersehbare Folgeschäden oder vorherseebare mittelbare Schäden), however, excluding (i) any lost profits (Section 252 BGB), (ii) any internal administration or overhead costs and (iii) taxes or similar charges on indemnification payments.

Clause 4.4(a) shall apply mutatis mutandis (entsprechende Anwendung) to any breach by S of its obligations under this Agreement.

The aggregate liability of the Shareholder under this Agreement for breaches of the Shareholder’s guarantees in clauses 4.1(h) to 4.1(o) shall be limited to twenty-five percent (25%) of the Offer Price multiplied by the number of Shareholder’s Shares actually paid to the Shareholder upon acceptance of the Offer. The aggregate liability of the Shareholder under this Agreement for breaches of the Shareholder’s guarantees in clauses 4.1(a) to 4.1(g) shall be limited to one hundred percent (100%) of the Offer Price multiplied by the number of Shareholder’s Shares actually paid to the Shareholder upon acceptance of the Offer. Furthermore, the aggregate liability of the Shareholder and of S for any breaches under this Agreement collectively shall be limited to one hundred percent (100%) of the Offer Price multiplied by the number of Shareholder’s Shares actually paid to the Shareholder upon acceptance of the Offer.

The Parties agree that the rights and remedies which the Acquirors may have with respect to a breach by the Shareholder of its obligations under this Agreement are limited to the rights and remedies specified in this clause 4.4. Subject to the preceding sentence, with respect to the subject matter of this Agreement, any all and all rights and remedies of any legal nature (other than the rights and claims expressly set forth in this Agreement) of the Acquirors against the Shareholder shall be expressly excluded.

The limitations set forth in this clause 4.4 shall not apply in case of fraud (arglistige Täuschung) or wilful misconduct (Vorsatz) of the Shareholder.

Until the twelve-month anniversary of the date of the Offer Completion, the Shareholder shall not, and S shall not cause the Shareholder to, directly or indirectly, distribute to its owners any portion of the aggregate Offer Price paid by the Bidder at the Offer Completion with respect to the Shareholder’s Shares (the Shareholder Proceeds). For the avoidance of doubt, this clause 4.1(f) shall not restrict the Shareholder from (i) investing the Shareholder Proceeds or (ii) making distributions to its owners of income derived from sources other than the Shareholder Proceeds or the investment of such proceeds.

Representations and Warranties by the Acquirors; Remedies

Acquirors’ Guarantees

The Acquirors hereby guarantee to the Shareholder by way of an independent promise of guarantee (selbständiges Garantieversprechen) within the meaning of Section 311 para. 1 BGB that as of the Effective Date the statements made below are, and as of the date of the Offer Completion will continue to be, true, complete and not misleading:

The Bidder is a stock corporation (Aktiengesellschaft), duly incorporated and existing under the laws of Germany, duly represented by its board of directors. BW is a corporation incorporated under the laws of the State of Delaware, United States of America and duly represented by its board of directors. BW indirectly through BorgWarner US Holding LLC, a corporation incorporated under the laws of the State of Delaware, United States of America, having its registered office at 3850 Hamlin Road, Auburn Hills, Michigan 48326, United States of America, has unrestricted ownership of all shares in the Bidder.

No bankruptcy, insolvency or similar proceedings in any jurisdiction have been commenced or applied for with respect to either of the Acquirors and neither of the Acquirors is over-indebted (überschuldet) or unable to pay its due debts (zahlungsunfähig) or for other reasons compelled to apply for the commencement of bankruptcy, insolvency or similar proceedings under applicable law. To the Knowledge of either of the Acquirors (as defined in clause 5.2), as of the Effective Date, no bankruptcy, insolvency or similar filings have been threatened in writing with respect to either of the Acquirors.

Both of the Acquirors have full authority and capacity to enter into and perform their respective obligations under this Irrevocable, including the consummation of the Offer. The Acquirors' entering into this Agreement and the performance of the Acquirors' respective obligations hereunder do not violate the articles of association (or similar document) or bylaws of either of the Acquirors and have been duly authorized by all necessary corporate actions on the part of each of the Acquirors. As of the Signing Date, the Acquirors' entering into this Agreement and the performance of the Acquirors' respective obligations hereunder neither require any approval or consent by any court, governmental authority or other third party (except for approvals or consents which are Offer Conditions) or violate any judicial or governmental order or decree or any applicable law.

The Acquirors have complied in all material respects with all capital market laws and regulations in Germany and the United States of America applicable to any transaction contemplated by this Agreement including, but not limited to, notification requirements, insider trading and market manipulation rules. None of the Acquirors, any Affiliate of either of the Acquirors, or any entity acting collectively with the Acquirors within the meaning of Section 2 para. 5 WpÜG has before the signing of this Agreement acquired or agreed to acquire or will acquire within a period that will be relevant under the minimum pricing rules pursuant to Section 31 WpÜG and Section 3 et seq. of the Takeover Regulation (WpÜG-Angebotsverordnung) any Target Shares for a consideration per share exceeding the Offer Price.

The Bidder is acquiring the Shareholder’s Shares for its own account as well as for investment and not with a view to any sale, distribution or other disposal thereof. Neither of the Acquirors is acting in the interest or for the account of any unaffiliated third party. BW has no intention to sell, distribute other otherwise dispose of any shares held in the Bidder to an entity outside its group.