Document:

EX-4.2

 Exhibit 4.2 
  

 
  

1.800% SENIOR NOTES DUE 2022 

FIFTH SUPPLEMENTAL INDENTURE 

between 
 BORGWARNER
INC., 
 as Issuer 

and 
 DEUTSCHE BANK
TRUST COMPANY AMERICAS, 
 as Trustee, Paying Agent, Security Registrar and Transfer Agent 

Dated as of November 6, 2015 
  

 
  

 TABLE OF CONTENTS 

 

							
	 	  	 	  	Page	 
			
	 ARTICLE 1
	  	 DEFINITIONS
	  	 	2	  
			
	 Section 1.01.
	  	 Definition of Terms
	  	 	2	  
			
	 ARTICLE 2
	  	 THE NOTES
	  	 	5	  
			
	 Section 2.01.
	  	 Designation
	  	 	5	  
			
	 Section 2.02.
	  	 Principal Amount; Series Treatment
	  	 	5	  
			
	 Section 2.03.
	  	 Maturity
	  	 	5	  
			
	 Section 2.04.
	  	 Payment in Euros
	  	 	5	  
			
	 Section 2.05.
	  	 Principal and Interest
	  	 	6	  
			
	 Section 2.06.
	  	 Form of Notes
	  	 	6	  
			
	 Section 2.07.
	  	 Transfers and Exchanges
	  	 	7	  
			
	 ARTICLE 3
	  	 REDEMPTION AND REPURCHASE OF THE NOTES
	  	 	8	  
			
	 Section 3.01.
	  	 Optional Redemption by Company
	  	 	8	  
			
	 Section 3.02.
	  	 Change of Control Repurchase Event
	  	 	8	  
			
	 Section 3.03.
	  	 Redemption for Tax Reasons
	  	 	9	  
			
	 ARTICLE 4
	  	 PAYMENT OF ADDITIONAL AMOUNTS
	  	 	10	  
			
	 Section 4.01.
	  	 General
	  	 	10	  
			
	 Section 4.02.
	  	 No other requirements
	  	 	12	  
			
	 ARTICLE 5
	  	 EXECUTION OF THE NOTES
	  	 	12	  
			
	 ARTICLE 6
	  	 TRUSTEE AND PAYING AGENT
	  	 	12	  
			
	 Section 6.01.
	  	 Appointment of Trustee
	  	 	12	  
			
	 Section 6.02.
	  	 Appointment of Paying Agent
	  	 	12	  
			
	 Section 6.03.
	  	 Acceptance
	  	 	12	  
			
	 Section 6.04.
	  	 Eligibility of Trustee
	  	 	13	  
			
	 Section 6.05.
	  	 Concerning the Trustee
	  	 	13	  
			
	 ARTICLE 7
	  	 MISCELLANEOUS
	  	 	13	  
			
	 Section 7.01.
	  	 Ratification of Indenture
	  	 	13	  
			
	 Section 7.02.
	  	 Trustee Not Responsible for Recitals
	  	 	13	  
			
	 Section 7.03.
	  	 Notices
	  	 	14	  
			
	 Section 7.04.
	  	 Governing Law; Jury Trial Waiver
	  	 	14	  
			
	 Section 7.05.
	  	 Separability
	  	 	15	  

  
 -i- 

 TABLE OF CONTENTS 

(continued) 
  

							
		  		  	 	Page	  
			
	 Section 7.06.
	  	 Counterparts
	  	 	15	  
			
	 Section 7.07.
	  	 U.S.A. Patriot Act
	  	 	15	  
			
	 EXHIBITS
	  		  			
			
	 Exhibit A
	  	 Form of 2022 Notes
	  			

  
 ii 

 FIFTH SUPPLEMENTAL INDENTURE, dated as of November 6, 2015 (the “Supplemental
Indenture”), between BorgWarner Inc. (formerly known as Borg-Warner Automotive, Inc.), a Delaware corporation (the “Company”) and Deutsche Bank Trust Company Americas, a national banking association, having its Corporate
Trust Office at 60 Wall Street, Trust and Agency Services, 16th Floor, New York, New York 10005, as series trustee (the “Trustee”), paying agent (the “Paying Agent”), security registrar (the “Security
Registrar”) and transfer agent (the “Transfer Agent”) supplemental to that certain Indenture, dated as of September 23, 1999 (the “Base Indenture” and, as supplemented by this Supplemental Indenture,
the “Indenture”), between the Company and The Bank of New York Mellon Trust Company, N.A. successor in interest to J.P. Morgan Trust Company, N.A. (successor in interest to The Chase Manhattan Trust Company, National Association), a
national banking association, as original trustee (the “Original Trustee”). 
 WHEREAS, the Company executed and delivered
the Base Indenture to provide for, among other things, the issuance from time to time of the Company’s debt securities in one or more series as might be authorized under the Indenture; 

WHEREAS, the Base Indenture provides that the Company may enter into an indenture supplemental to the Base Indenture to establish the form and
terms of any series of Securities (as defined in the Base Indenture) as provided by Sections 201 and 301 of the Base Indenture; 
 WHEREAS,
the Board of Directors of the Company has duly adopted resolutions authorizing the Company to issue the Notes provided for in this Supplemental Indenture; 

WHEREAS, the Company desires to enter into this Supplemental Indenture to provide for the establishment of a series of Securities (as defined
in the Indenture) to be known as the 1.800% Senior Notes due 2022 (the “Notes”), the form, substance, terms, provisions and conditions of which are set forth in the Base Indenture and this Supplemental Indenture; 

WHEREAS, the Company has duly appointed Deutsche Bank Trust Company Americas as Trustee, Paying Agent, Security Registrar and Transfer Agent
with respect to the Notes (but only with respect to the Notes) pursuant to an officers’ certificate, dated November 6, 2015, as contemplated by Section 303 of the Indenture, with all of the rights, powers, trusts, duties and
obligations under the Indenture with respect to the Notes (but only with respect to the Notes), and Deutsche Bank Trust Company Americas is willing to accept such appointments with respect to the Notes; 

WHEREAS, the Company is entering into this Supplemental Indenture with the Trustee to evidence and provide for the acceptance of appointment
thereunder by the Trustee with respect to the Notes (but only with respect to the Notes); and 
 WHEREAS, in respect of the foregoing
Company has requested that the Trustee execute and deliver this Supplemental Indenture and has satisfied all requirements necessary to (i) make this Supplemental Indenture a valid instrument in accordance with its terms and (ii) make the
series of Notes provided for hereby, when executed and delivered by the Company and authenticated by the Trustee, the valid obligations of the Company. 

 NOW THEREFORE, each party agrees as follows for the benefit of the other parties and for the
equal and ratable benefit of the Holders of the Notes: 
 ARTICLE 1 

Definitions 
 Section 1.01.
Definition of Terms. 
 Unless otherwise specified herein or the context otherwise requires: 

(a) a term defined in the Indenture has the same meaning when used in this Supplemental Indenture unless the definition of such term is
amended and supplemented pursuant to this Supplemental Indenture; 
 (b) the terms defined in this Article and in this Supplemental
Indenture include the plural as well as the singular; 
 (c) a reference to a Section or Article is to a Section or Article of this
Supplemental Indenture; 
 (d) Article and Section headings herein and the Table of Contents are for convenience only and shall not affect
the construction hereof; 
 (e) The following terms have the meanings given to them in this Section 1.01(e): 

“Below Investment Grade Rating Event” means the Notes are rated below Investment Grade by each Rating Agency on any date from
the date of the public notice of an arrangement that could result in a Change of Control until the end of the 60-day period following public notice of the occurrence of such Change of Control (which period shall be extended so long as the rating of
the Notes is under publicly announced consideration for possible downgrade by either of the Rating Agencies); provided, that, a Below Investment Grade Rating Event otherwise arising by virtue of a particular reduction in rating shall
not be deemed to have occurred in respect to a particular Change of Control (and thus shall not be deemed a Below Investment Grade Rating Event for purposes of the definition of Change of Control Repurchase Event hereunder) if the Rating Agencies
making the reduction in rating to which this definition would otherwise apply do not announce or publicly confirm or inform the Trustee in writing at the Company’s or the Trustee’s request that the reduction was the result, in whole or in
part, of any event or circumstance comprised of or arising as a result of, or in respect of, such Change of Control (whether or not such Change of Control shall have occurred at the time of the Below Investment Grade Rating Event). Neither the
Trustee nor any Paying Agent shall be responsible for monitoring the rating status of the Notes, making any request upon any Rating Agency, or determining whether any Below Investment Grade Rating Event has occurred. 

“Business Day” means any day that is not a Saturday or Sunday, (1) which is not a day on which banking institutions in
The City of New York, London or Frankfurt are authorized or required by law, regulation or executive order to close and (2) on which the Trans-European Automated Real-Time Gross Settlement Express Transfer system (the TARGET2 system), or any
successor thereto, is open. 

  
 2 

 “Change of Control” means the consummation of any transaction (including,
without limitation, any merger or consolidation) the result of which is that any “person” (as that term is used in Section 13(d)(3) of the Exchange Act) (as defined below)) becomes the beneficial owner, directly or indirectly, of more
than 50% of the Company’s Voting Stock measured by voting power rather than number of shares. 
 “Change of Control Repurchase
Event” means the occurrence of both a Change of Control and a Below Investment Grade Rating Event. 

“Clearstream” means Clearstream Banking, société anonyme. 

“Common Depositary” means any Person acting as the common depositary for Euroclear and Clearstream, which initially shall be
Deutsche Bank AG, London Branch. 
 “Corporate Trust Office” means the designated office of the Trustee at which any time
ins corporate trust business shall be administered, which office at the date hereof is located at 60 Wall Street – 16th floor, New York, New York 10005, or such other address as the Trustee
may designate from time to time by notice to the Holders and the Company, or the designated corporate trust office of any successor Trustee (or other such address as such successor Trustee may designate from time to time by notice to the Holders and
the Company). 
 “Definitive Securities” means the definitive form of Securities whereby the Securities are to be issued in
whole or in part in the form of one or more Global Securities and, in such case, the Depositary for such Global Security or Global Securities, and the terms and conditions, if any, upon which interests in such Global Security or Global Securities
may be exchanged in whole or in part for the definitive securities represented thereby in a definitive form registered in the name of Persons other than such Depositary or a nominee or nominees thereof. 

“Exchange Act” means the Securities Exchange Act of 1934, as amended. 

“Euro” or “€” means the currency of the member states of the European Monetary Union that have adopted
or that adopt the single currency in accordance with the treaty establishing the European Community, as amended by the Treaty on European Union, as amended from time to time. 

“Euroclear” means Euroclear Bank S.A./N.V. 

“Global Securities” shall have the meaning set forth in Section 2.06(a). 

“Initial Notes” means (i) all Notes issued on the first date that Notes were originally issued under this Supplemental
Indenture, (ii) any additional Notes issued under Section 2.02(a) and (iii) any Notes issued in replacement therefor. 

“Investment Grade” means a rating of Baa3 or better by Moody’s (or its equivalent under any successor rating categories
of Moody’s), a rating of BBB- or better by S&P (or its equivalent under any successor rating categories of S&P) and the equivalent investment grade credit rating from any additional Rating Agency or Rating Agencies selected by the
Company. 

  
 3 

 “Market Exchange Rate” means the noon buying rate in The City of New York for
cable transfer of euros as certified for customs purposes (or, if not so certified, as otherwise determined) by the Federal Reserve Bank of New York. 

“Moody’s” means Moody’s Investors Service Inc. 

“Notes” shall have the meaning set forth in the recitals above and shall include the Global Securities. 

“Person” means an individual, a corporation, a limited liability company, a partnership, an association, a joint stock
company, a trust, an unincorporated organization or a government or an agency or political subdivision thereof. 
 “Rating
Agency” means: (1) each of Moody’s and S&P; and (2) if either of Moody’s or S&P ceases to rate the Notes or fails to make a rating of the Notes publicly available for reasons outside of the Company’s
control, a “nationally recognized statistical rating organization” within the meaning of Section 3(a)(62) of the Exchange Act, selected by the Company (as certified by a resolution of the Company’s Board of Directors) as a
replacement agency for Moody’s or S&P, or both, as the case may be. 
 “Redemption Price” means the Tax Redemption
Price or the Redemption Price for a redemption pursuant to Section 3.01, as the case may be. 
 “S&P” means
Standard & Poor’s Ratings Services, a division of McGraw-Hill, Inc. 
 “United States person” means any
individual who is a citizen or resident of the United States for U.S. federal income tax purposes, a corporation, partnership or other entity created or organized in or under the laws of the United States, any state of the United States or the
District of Columbia, including an entity treated as a corporation for United States income tax purposes, or any estate or trust the income of which is subject to United States federal income taxation regardless of its source. 

“U.S. Dollar” or “$” means the currency of the United States of America. 

“Voting Stock” of any specified “person” (as that term is used in Section 13(d)(3) of the Exchange Act) as of
any date means the capital stock of such person that is at the time entitled to vote generally in the election of the board of directors of such person. 

  
 4 

 ARTICLE 2 

The Notes 
 Section 2.01.
Designation. 
 The Company hereby establishes a series of Securities designated the “1.800% Senior Notes due 2022” for
issuance under the Indenture. 
 Section 2.02. Principal Amount; Series Treatment. 

(a) The Notes shall be initially limited to an aggregate principal amount of €500,000,000; except for Notes authenticated and delivered
upon registration or transfer of, or in exchange for, or in lieu of, Notes pursuant to Sections 203, 304, 305, 306 or 906 of the Base Indenture. However, the Company may, from time to time, without the consent of
the Holders of the outstanding Notes, issue additional Notes, so that such additional Notes and the other Outstanding Notes of this series shall be consolidated together and form a single series of Securities under the Indenture, as supplemented by
this Supplemental Indenture. 
 (b) Any additional Notes issued under Section 2.02(a) shall have the same terms in all respects
as the corresponding series of Notes, except that interest will accrue on the additional Notes from the most recent date to which interest has been paid on the Outstanding Notes of such series (other than the additional Notes) or, if no interest has
been paid on the Outstanding Notes of such series from the first date that the Outstanding Notes were originally issued under the Indenture, as supplemented by this Supplemental Indenture. 

(c) For all purposes of the Indenture and this Supplemental Indenture, all Notes, whether Initial Notes or additional Notes issued under
Section 2.02(a), shall constitute one series of Securities and shall vote together as one series of Securities. 

Section 2.03. Maturity. 

Unless previously redeemed or repurchased in full in accordance with Article 3 of this Supplemental Indenture, the Notes will become due and
payable on November 7, 2022. 
 Section 2.04. Payment in Euros. 

Principal of, and premium or Redemption Price, if any, and interest on, and Additional Amounts (as defined herein), if any, with respect to the
Notes shall be payable in euro. However, if the euro is unavailable to the Company due to the imposition of exchange controls or other circumstances beyond the Company’s control or the euro is no longer used by the member states of the European
Monetary Union that have adopted the euro as their currency or for the settlement of transactions by public institutions within the international banking community, then all payments in respect of the Notes shall be made in U.S. Dollars until the
euro is again available to the Company or so used. The amount payable on any date in euro shall be converted to U.S. Dollars on the basis of the Market Exchange Rate on the second Business Day before the date that payment is due, or if such Market
Exchange Rate is not then available, on the basis of the Market Exchange Rate most recently available prior to such second Business Day. Any 

  
 5 

 
payment in respect of the Notes so made in U.S. Dollars shall not constitute an Event of Default under the Indenture of the Notes. Neither the Trustee nor Paying Agent shall be responsible for
obtaining exchange rates, effecting conversions or otherwise handling redenominations. 
 Section 2.05. Principal and Interest.

 The Notes will bear interest at the rate of 1.800% per annum from, and including November 6, 2015, or from the most recent
Interest Payment Date to which interest has been paid or provided for, until the principal thereof becomes due and payable, and on any overdue principal (to the extent that payment of such interest is enforceable under applicable law) on any overdue
installment of interest at the same rate per annum. Interest on the Notes shall be payable annually in arrears on November 7 of each year, commencing on November 7, 2016 (the “Interest Payment Date”). Interest on the Notes
shall be computed on the basis of the actual number of days in the period for which interest is being calculated and the actual number of days from and including the last date on which interest was paid on this Note (or from November 6, 2015,
if no interest has been paid on this Note) to but excluding the next scheduled Interest Payment Date. This payment convention is referred to as ACTUAL/ACTUAL (ICMA) (as defined in the rulebook of the international Capital Market Association).
Payments of interest shall be made to the Person in whose name a Note (or predecessor Note) is registered (which shall initially be the Common Depositary) at the close of business on the fifteenth calendar day, whether or not a Business Day,
immediately preceding such Interest Payment Date (the “Record Date”). If any Interest Payment Date, maturity date or earlier date of redemption or repurchase falls on a day that is not a Business Day, the required payment shall be
made on the next Business Day as if it were made on the date the payment was due and no interest shall accrue on the amount so payable for the period from and after that Interest Payment Date, that maturity date or that date of redemption or
repurchase, as the case may be. 
 The principal of each Note payable at maturity or upon earlier redemption shall be paid against
presentation and surrender of such Note at the office or agency maintained for such purpose in London, initially the corporate trust office of the Paying Agent in London, in euro. 

Section 2.06. Form of Notes. 

(a) The Notes shall be issued in the form of one or more global notes in fully registered from, without coupons (“Global
Securities”), duly executed by the Company and authenticated by the Trustee, which shall be deposited with, or on behalf of, the Common Depositary and shall be registered in the name of BT Globenet Nominees Limited, as nominee of Deutsche
Bank AG, London Branch, as Common Depositary for, and in respect of interests held through, Euroclear and Clearstream. The Notes shall be substantially in the form of Exhibit A attached hereto. Except as provided for in
Section 2.07, owners of beneficial interests in the Global Securities will not be entitled to have Notes registered in their names, and will not receive or be entitled to receive physical delivery of Notes in definitive form. So long as
the Common Depositary or its nominee is the registered Holder of the Global Securities, the Common Depositary or its nominee, as the case may be, shall be considered the sole owner or Holder of the Notes represented by such Global Securities for all
purposes under the Indenture and the Notes. 

  
 6 

 (b) The terms and provisions contained in the form of Notes set forth in Exhibit A shall
constitute, and are hereby expressly made, a part of the Indenture, as supplemented by this Supplemental Indenture. 
 Notwithstanding the
foregoing, in considering the interests of Holders while the Notes are represented by the Global Securities held on behalf of Clearstream and Euroclear, the Trustee may have regard to any information provided to it by or on behalf of Clearstream and
Euroclear as to the identity (either individually or by category) of their respective direct participants and may consider such interests as if these direct participants were Holders of the Global Securities, provided that, in doing so, the Trustee
will not have any responsibility or liability for any records relating to, or payments made on account of, beneficial ownership interests in the Global Securities or for maintaining, supervising or reviewing any records relating to such beneficial
ownership interests 
 Any of the Notes may have such letters, numbers or other marks of identification and such legends or endorsements
placed thereon as the officers executing the same may approve (execution thereof to be conclusive evidence of such approval) and as are not inconsistent with the provisions of the Indenture, as supplemented by this Supplemental Indenture, or as may
be required by the Depositary or as may be required to comply with any applicable law or with any rule or regulation made pursuant thereto or with any rule or regulation of any securities exchange or automated quotation system on which the Notes may
be listed, or to conform to usage, or to indicate any special limitations or restrictions to which any particular Notes are subject. 

Notwithstanding Section 303 of the Indenture, the Notes do not require a corporate seal to be reproduced thereon. 

(c) Denominations and Payments. The Notes shall be issued only in minimum denominations of €100,000 and integral multiples of
€1,000 in excess thereof. All payments of principal, premium or Redemption Price, if any, and interest in respect of the Notes shall be made by the Company in immediately available funds. 

Section 2.07. Transfers and Exchanges. 

(a) The Global Securities shall be exchanged by the Company for Definitive Securities if: 

(i) Euroclear or Clearstream notify the Company that it is no longer willing or able to act as clearing agency for the Notes;

 (ii) the Company, at its option, notifies the Trustee in writing that it elects to cause the issuance of certificated
notes; or 
 (iii) there has occurred and is continuing an Event of Default with respect to the Notes. 

(b) Whenever a Global Security is exchanged for one or more Definitive Securities, it shall be surrendered by the Holder thereof to the
Security Registrar and Transfer Agent and cancelled by the Security Registrar and Transfer Agent. All Definitive Securities issued in 

  
 7 

 
exchange for a Global Security, a beneficial interest therein or a portion thereof shall be registered in the names, and issued in any approved denominations, requested by or on behalf of the
Common Depositary (in accordance with its customary procedures). 
 (c) Any owner of a beneficial interest in a Global Security shall, by
acceptance of such beneficial interest in the Global Security, agree that transfer of beneficial interests in such Global Security may be effected only through a book-entry system maintained by Holder (or its agent), and that, subject to
Section 2.07(a), ownership of a beneficial interest in the Notes represented thereby shall be required to be reflected in book-entry form. Transfers of a Global Security shall be limited to transfer in whole and not in part, to the
Common Depositary, its successors and their respective nominees. Interests of beneficial owners in a Global Security shall be transferred in accordance with the rules and procedures of Euroclear and Clearstream (or their respective successors). 

(d) Payments (including principal, premium, Redemption Price and interest) and transfers with respect to Definitive Securities shall be
executed at the office or agency maintained for such purpose in London (initially the Corporate Trust Office of the Paying Agent) or, at the Company’s option, by check mailed to the Holders at the respective addresses set forth in the Register,
provided that all payments (including principal, premium, Redemption Price and interest) on Definitive Securities, for which the Holders thereof have given wire transfer instructions, shall be required to be made by wire transfer of immediately
available funds to the accounts specified by the Holders thereof. No service charge shall be made for any registration of transfer, other than payment of a sum sufficient to cover any tax or governmental charge, if any, payable in connection with
such registration. 
 ARTICLE 3 

Redemption and Repurchase Of The Notes 

Section 3.01. Optional Redemption by Company. The Notes may be redeemed at the option of the Company on the terms and conditions
set forth in the form of Note set forth as Exhibit A. 
 Section 3.02. Change of Control Repurchase Event. 

(a) If a Change of Control Repurchase Event occurs, unless the Company has exercised its right to redeem the Notes as described in
Section 3.01, the Company shall make an offer to each Holder to repurchase all or any part (in minimum denominations of €100,000 and any integral multiples of €1,000 in excess thereof) of that Holder’s Notes at a purchase
price in cash equal to 101% of the aggregate principal amount of Notes to be repurchased plus unpaid interest, if any, accrued thereon to, but excluding, the date of repurchase. Within 30 days following any Change of Control Repurchase Event or, at
the Company’s option, prior to any Change of Control, but after the public announcement of a Change of Control, the Company shall mail a notice to each Holder, with a copy to the Trustee and the Paying Agent, describing the transaction or
transactions that constitute or may constitute the Change of Control Repurchase Event and offering to repurchase the Notes on the payment date specified in the notice, which date shall be no earlier than 30 days and no later than 60 days from the
date such 

  
 8 

 
notice is mailed. The notice shall, if mailed prior to the date of consummation of the Change of Control, state that the offer to purchase is conditioned on the Change of Control Repurchase Event
occurring on or prior to the payment date specified in the notice. 
 (b) The Company shall comply with the requirements of Rule 14e-1 under
the Exchange Act and any other securities laws and regulations thereunder to the extent those laws and regulations are applicable in connection with the repurchase of the Notes as a result of a Change of Control Repurchase Event. To the extent that
the provisions of any securities laws or regulations conflict with the Change of Control Repurchase Event provisions of this Supplemental Indenture, the Company shall comply with the applicable securities laws and regulations and shall not be deemed
to have breached its obligations under the Change of Control Repurchase Event provisions of this Supplemental Indenture by virtue of such conflict. 

(c) On the Change of Control Repurchase Event payment date, the Company shall, to the extent lawful: 

(i) accept for payment all Notes or portions of Notes properly tendered pursuant to the Company’s offer; 

(ii) deposit with the Paying Agent an amount equal to the aggregate purchase price in respect of all Notes or portions of Notes
properly tendered; and 
 (iii) deliver or cause to be delivered to the Trustee the Notes properly accepted, together with an
Officers’ Certificate stating the aggregate principal amount of Notes being repurchased by the Company. 
 (d) The Paying Agent shall
promptly mail its check or otherwise cause to be paid to each Holder of Notes properly tendered the purchase price for the Notes, and the Trustee shall promptly authenticate and mail (or cause to be transferred by book-entry) to each Holder a new
Note equal in principal amount to any unrepurchased portion of any Notes surrendered; provided that each new Note shall be in a principal amount equal to €100,000 or an integral multiple of €1,000 in excess thereof. 

(e) The Company shall not be required to make an offer to repurchase the Notes upon a Change of Control Repurchase Event if a third party
makes such an offer in the manner, at the times and otherwise in compliance with the requirements for an offer made by the Company and such third party purchases all Notes properly tendered and not withdrawn under its offer. 

Section 3.03. Redemption for Tax Reasons. If as a result of any change in, or amendment to, the laws (or any regulations or
rulings promulgated under the laws) of the United States (or any taxing authority thereof or therein), or any change in, or amendments to, an official position regarding the application or interpretation of such laws, regulations or rulings, which
change or amendment is announced or becomes effective on or after November 2, 2015, the Company becomes or, based upon a written opinion of independent counsel of recognized standing selected by the Company, will become obligated to pay
Additional Amounts with respect to the Notes as set forth in Article 4 hereof, then the Notes may be redeemed at the option of the Company, in whole, but not in part, having given not less than 30 days nor more than 60 days prior notice to
the Holders of the Notes, at a redemption price (the “Tax Redemption Price”) equal to 100% of the principal amount of the Notes being redeemed together with accrued and unpaid interest thereon, to, but excluding, the Redemption
Date. 

  
 9 

 ARTICLE 4 

Payment of Additional Amounts 

Section 4.01. General. All payments in respect of the Notes shall be made by or on behalf of the Company without withholding or
deduction for, or on account of, any present or future taxes, duties, assessments or governmental charges of whatever nature, imposed or levied by the United States or any taxing authority thereof or therein, unless such withholding or deduction is
required by law. If such withholding or deduction is required by law, the Company or Paying Agent shall pay to a Holder who is not a United States person such additional amounts (the “Additional Amounts”) on the Notes as are
necessary in order that the net payment by the Company or a paying agent of the principal of, and premium or Redemption Price, if any and interest on, the Notes to such Holder, after such withholding or deduction, shall not be less than the amount
provided in the Notes to be then due and payable; provided, however, that the foregoing obligation to pay Additional Amounts shall not apply: 

(a) to any tax, duty, assessment or other governmental charge that would not have been imposed but for the Holder, or a fiduciary, settlor,
beneficiary, member or shareholder of the Holder if the Holder is an estate, trust, partnership or corporation, or a person holding a power over an estate or trust administered by a fiduciary holder, being considered as: 

(i) being or having been engaged in a trade or business in the United States or having or having had a permanent establishment
in the United States or having or having had a qualified business unit which has the U.S. Dollar as its functional currency; 

(ii) having a current or former connection with the United States (other than a connection arising solely as a result of the
ownership of the Notes, the receipt of any payment or the enforcement of any rights thereunder) or being considered as having such relationship, including being or having been a citizen or resident of the United States; 

(iii) being or having been a personal holding company, a passive foreign investment company or a controlled foreign corporation
with respect to the United States or a foreign personal holding company that has accumulated earnings to avoid United States federal income tax; 

(iv) being or having been an owner of a 10% or greater interest in the capital or profits of the Company within the meaning of
Section 871(h)(3) of the United States Internal Revenue Code of 1986, as amended (the “Code”), or any successor provision; or 

(v) being a bank receiving payments on an extension of credit made pursuant to a loan agreement entered into in the ordinary
course of its trade or business; 
 (b) to any Holder that is not the sole beneficial owner of the Notes, or a portion of the Notes, or that
is a fiduciary, partnership or limited liability company, but only to the extent that a beneficiary or settlor with respect to the fiduciary, a beneficial owner or member of the 

  
 10 

 
partnership or limited liability company would not have been entitled to the payment of an Additional Amount had the beneficiary, settlor, beneficial owner or member received directly its
beneficial or distributive share of the payment; 
 (c) to any tax, duty, assessment or other governmental charge that would not have been
imposed but for the failure of the Holder or any other person to comply with certification, identification or information reporting requirements concerning the nationality, residence, identity or connection with the United States of the Holder or
beneficial owner of the Notes, if compliance is required by statute, by regulation of the United States or any taxing authority therein or by an applicable income tax treaty to which the United States is a party as a precondition to exemption from
such tax, assessment or other governmental charge; 
 (d) to any tax, duty, assessment or other governmental charge that is imposed
otherwise than by withholding by the Company or a Paying Agent from the payment; 
 (e) to any tax, duty, assessment or other governmental
charge that would not have been imposed but for a change in law, regulation, or administrative or judicial interpretation that becomes effective more than 15 days after the payment becomes due or is duly provided for, whichever occurs later; 

(f) to any estate, inheritance, gift, sales, excise, transfer, wealth, capital gains or personal property tax or similar tax, assessment or
other governmental charge; 
 (g) to any withholding or deduction that is imposed on a payment to an individual and that is required to be
made pursuant to European Counsel Directive 2003/48/EC on the taxation of savings income or any other Directive amending, supplementing or replacing such Directive, or any law implementing or complying with, or introduced in order to conform to,
such Directive or Directives; 
 (h) to any tax, duty, assessment or other governmental charge required to be withheld by any Paying Agent
from any payment of principal of, or premium, if any, or interest on any Note, if such payment can be made without such withholding by at least one other Paying Agent; 

(i) to any tax, duty, assessment or other governmental charge that would not have been imposed but for the presentation by the Holder of any
Note, where presentation is required, for payment on a date more than 30 days after the date on which payment became due and payable or the date on which payment thereof is duly provided for, whichever occurs later; 

(j) to any tax, duty, assessment or other governmental charge required to be withheld or deducted under Sections 1471 through 1474 of the Code
(or any amended or successor version of such Sections) (“FATCA”), any regulations or other guidance thereunder, or any agreement (including any intergovernmental agreement) entered into a connection therewith, or any law, regulation or
other official guidance enacted in any jurisdiction implementing FATCA or any intergovernmental agreement in respect of FATCA; or 
 (k) in
the case of any combination of items (a) through (j). 

  
 11 

 Section 4.02. No other requirements. The Notes are subject in all cases to any tax,
fiscal or other law or regulation or administrative or judicial interpretation applicable to the Notes. Except as specifically provided under this Article 4, the Company shall not be required to make any payment for any tax, duty, assessment
or governmental charge of whatever nature imposed by any government or a political subdivision or taxing authority of or in any government or political subdivision. 

ARTICLE 5 
 Execution Of The Notes

 Section 5.01. Execution; Certificates. The Notes and any Officers’ Certificate to be delivered under the Indenture in
connection with the authentication and delivery of the Notes shall be executed and delivered as set forth in the Indenture. 
 ARTICLE 6 

Trustee and Paying Agent 

Section 6.01. Appointment of Trustee. As provided in the officers’ certificate, dated November 6, 2015, as contemplated
by Section 303 of the Indenture, the Trustee for the Notes shall initially be Deutsche Bank Trust Company Americas. The duties and responsibilities of Trustee with respect to the Notes (and only the Notes) shall be as set forth in the Indenture
and the Notes and no implied covenants nor obligations shall be read into this Indenture against the Trustee, except as otherwise required by the Trust Indenture Act. 

Section 6.02. Appointment of Paying Agent. The Paying Agent for the Notes shall initially be Deutsche Bank Trust Company Americas.
The Company hereby initially designates the Corporate Trust Office of the Paying Agent, initially 60 Wall Street, Trust and Agency Services, 16th Floor, New York, New York 10005, as the office to be maintained by it where Notes may be presented for
payment, registration of transfer or exchange, and where notices to or demands upon the Company in respect of the Notes or the Indenture may be served. The Security Registrar and Transfer Agent for the Notes shall initially be Deutsche Bank Trust
Company Americas. The Company reserves the right at any time to vary or terminate the appointment of any Paying Agent, Security Registrar or Transfer Agent, to appoint additional or other Paying Agents, Security Registrars or Transfer Agents and to
approve any change in the office through which any Paying Agent or Security Registrar acts. To the extent permitted by applicable law and regulation, the Paying Agent, Security Registrar and Transfer Agent may, and to the extent required by
applicable law and regulation the Paying Agent, Security Registrar and Transfer Agent shall, exercise any of their respective rights or duties or perform their respective obligations under the Indenture and Notes by or through their respective
agents or affiliates provided that the Paying Agent, Security Registrar and Transfer Agent shall be fully responsible for due care and faithful performance of the such respective agents or affiliates. 

Section 6.03. Acceptance. Deutsche Bank Trust Company Americas hereby accepts its appointment as Trustee, Security Registrar,
Paying Agent, Security Registrar and Transfer Agent under the Indenture with respect to the Notes (but only with respect to the Notes) and accepts all 

  
 12 

 
of the rights, powers, trusts, duties and obligations of Trustee, Security Registrar, Paying Agent, Security Registrar and Transfer Agent under the Indenture with respect to the Notes (but only
with respect to the Notes), upon the terms and conditions set forth herein and therein, with like effect as if originally named as such in the Base Indenture. Pursuant to the Base Indenture, there shall continue to be vested in the Original Trustee
all of its rights, powers, trusts, duties and obligations as trustee under the Base Indenture with respect to all of the series of Securities as to which it has served and continues to serve as trustee, and the Original Trustee shall have no rights,
powers, trusts, duties and obligations with respect to the Notes. 
 Section 6.04. Eligibility of Trustee. The Trustee hereby
represents that it is qualified and eligible under the provisions of the Trust Indenture Act and Section 607 of the Base Indenture to accept its appointment as Trustee with respect to the Notes. 

Section 6.05. Concerning the Trustee. Neither the Original Trustee nor the Trustee assumes any duties, responsibilities or
liabilities by reason of this Supplemental Indenture other than as set forth in the Indenture and, in carrying out its respective responsibilities thereunder, each shall have all of the rights, powers, privileges, protections, duties and immunities
which it possesses under the Indenture. The Original Trustee and the Trustee shall not constitute co-trustees of the same trust, and each of the Original Trustee and the Trustee shall be trustee of a trust or trusts under the Indenture separate and
apart from any trust or trusts under the Indenture administered by the other trustee. The Original Trustee shall have no liability for any acts or omissions of the Trustee and the Trustee shall have no liability for any acts or omissions of the
Original Trustee. 
 ARTICLE 7 

Miscellaneous 

Section 7.01. Ratification of Indenture. 

The Indenture, as supplemented by this Supplemental Indenture, is in all respects ratified and confirmed, and this Supplemental Indenture shall
be deemed part of the Indenture in the manner and to the extent herein and therein provided. 
 Section 7.02. Trustee Not
Responsible for Recitals. 
 The recitals herein contained are made by the Company and not by the Trustee, and the Trustee assumes no
responsibility for the correctness thereof. The Trustee makes no representation as to the validity or sufficiency of this Supplemental Indenture. All of the provisions contained in the Indenture in respect of the rights, privileges, immunities,
powers, and duties of the Trustee shall be applicable in respect of the Supplemental Indenture as fully and with like force and effect as though fully set forth in full herein. The Trustee shall not be accountable for the use or application by the
Company of the Notes or the proceeds thereof. In no event shall the Trustee be responsible or liable for any failure or delay in the performance of its obligations hereunder arising out of or caused by, directly or indirectly, forces beyond its
control, including, without limitation, strikes, work stoppages, accidents, acts of war or terrorism, civil or military disturbances, nuclear or natural catastrophes or acts of God, and 

  
 13 

 
interruptions, loss or malfunctions of utilities, communications or computer (software and hardware) services, or other unavailability of the Federal Reserve Bank wire or facsimile or other wire
or communication facility; it being understood that the Trustee shall use reasonable efforts which are consistent with accepted practices in the banking industry to resume performance as soon as practicable under the circumstances. 

Section 7.03. Notices. 

Any request, demand, authorization, direction, notice, consent, waiver of Act of Holders or other documents provided or permitted by the Base
Indenture to be made upon, given or furnished to, or filed with, the Trustee shall be sufficient for every purpose if made, given, furnished or filed in writing to or with the Trustee at the following address: 

Deutsche Bank Trust Company Americas 

60 Wall Street - 16th floor 

MSNYC60-1630 
 New York, New
York 10005 
 Attn: Trust and Agency Services 

Client Services - BorgWarner, Inc. 

Fax: 732-578-4635 
 With
copy to: 
 Deutsche Bank National Trust Company 

100 Plaza One - 6th floor 

MSJCY03-0699 
 Jersey City,
NJ 07311 
 Attn: Trust and Agency Services 

Client Services - BorgWarner, Inc. 

Fax: 732-578-4635 
 The
Trustee by notice to the Company may designate additional or different addresses for subsequent notices or communications. 
 Notices shall
be mailed to the registered Holders of the Notes at their respective addresses in the register of Holders maintained by the Registrar, save as otherwise provided herein. Any such notice shall be deemed to have been given on the date of mailing.
Notwithstanding any other provisions herein, so long as the Notes are represented by one or more such Global Securities deposited with a common depositary on behalf of Clearstream and Euroclear, notices to and from Holders of the Notes may be given
by delivery to Clearstream and Euroclear in accordance with their standard procedures, and such notices shall be deemed to be given on the date of the delivery of such notices to Clearstream and Euroclear. 

Section 7.04. Governing Law; Jury Trial Waiver. 

This Supplemental Indenture and the Notes shall be governed by and construed in accordance with the laws of the State of New York. 

  
 14 

 EACH OF THE COMPANY, THE TRUSTEE AND EACH HOLDER, BY ITS ACCEPTANCE OF A NOTE, HEREBY IRREVOCABLY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS SUPPLEMENTAL INDENTURE OR THE TRANSACTIONS CONTEMPLATED HEREBY. 

Section 7.05. Separability. 

In case any provision contained in this Supplemental Indenture or in the Notes shall for any reason be held to be invalid, illegal or
unenforceable in any respect, such invalidity, illegality or unenforceability shall not affect any other provisions of this Supplemental Indenture or of the Notes, but this Supplemental Indenture and the Notes shall be construed as if such invalid
or illegal or unenforceable provision had never been contained herein or therein. 
 Section 7.06. Counterparts. 

This Supplemental Indenture may be executed in any number of counterparts each of which shall be an original; but such counterparts shall
together constitute but one and the same instrument. Signatures of the parties hereto transmitted by facsimile or PDF may be used in lieu of the originals shall be deemed to be their original signatures for all purposes. 

Section 7.07. U.S.A. Patriot Act. 

The Company acknowledges that in accordance with Section 326 of the U.S.A. PATRIOT Act, the Trustee, like all financial institutions and
in order to help fight the funding of terrorism and money laundering, is required to obtain, verify, and record information that identifies each person or legal entity that establishes a relationship or opens an account with the Trustee. The parties
to this Supplemental Indenture agree that they will provide the Trustee with such information as it may request in order for the Trustee to satisfy the requirements of the U.S.A. PATRIOT Act. 

********** 

  
 15 

 IN WITNESS WHEREOF, the parties hereto have caused this Fifth Supplemental Indenture to be duly
executed and attested, all as of the day and year first above written. 
  

			
	BORGWARNER INC.
		
	By:	 	 /s/ Thomas J. McGill

	Name:	 	Thomas J. McGill
	Title:	 	Vice President and Treasurer

  

			
	Attest:	 	 /s/ John J. Gasparovic

	Name:	 	John J. Gasparovic
	Title:	 	Vice President, General Counsel
		 	and Secretary

  

			
	 DEUTSCHE BANK TRUST COMPANY AMERICAS, as Trustee

		
	By:	 	 /s/ Wanda Camacho

	Name:	 	Wanda Camacho
	Title	 	Vice President

  

			
	Attest:	 	 /s/ Linda Reale

	Name:	 	Linda Reale
	Title:	 	Vice President

  

			
	By:	 	 /s/ Robert Peschler

	Name:	 	Robert Peschler
	Title	 	Vice President

  

					
		 	S-1	 	(Signature Page to Supplemental Indenture)

 EXHIBIT A 

[FACE OF NOTE] 
 ISIN: XS1317708805 

No. 1 
 BORGWARNER INC. 

€500,000,000 
 1.800% Senior
Note due 2022 
 BORGWARNER INC., a Delaware corporation (herein referred to as the “Company,” which term includes any
successor under the Indenture hereinafter referred to), for value received, hereby promises to pay to BT Globenet Nominees Limited, or registered assigns, the principal sum of €500,000,000 on November 7, 2022 (the “Maturity
Date”), unless redeemed or repurchased prior to such date as permitted or required by this Note. Interest shall be paid at the rate of 1.800% per annum from November 6, 2015 or from the most recent Interest Payment Date to which
interest has been paid or duly provided for, on November 7 of each year, commencing on November 7, 2016 (the “Interest Payment Date”), until the principal hereof is paid or made available for payment. Interest on this Note
shall be computed on the basis of the actual number of days in the period for which interest is being calculated and the actual number of days from and including the last date on which interest was paid on this Note (or from November 6, 2015,
if no interest has been paid on this Note) to but excluding the next scheduled Interest Payment Date . This payment convention is referred to as ACTUAL/ACTUAL (ICMA) (as defined in the rulebook of the international Capital Market Association). If
any Interest Payment Date, maturity date or earlier date of redemption or repurchase falls on a day that is not a Business Day, the required payment shall be made on the next Business Day as if it were made on the date the payment was due and no
interest shall accrue on the amount so payable for the period from and after that Interest Payment Date, that maturity date or that date of redemption or repurchase, as the case may be 

General. This Note is one of a duly authorized issue of securities (the “Securities”) of the Company, issued
and to be issued in one or more series under an Indenture, dated as of September 23, 1999 (the “Base Indenture”), between the Company and The Bank of New York Mellon Trust Company, N.A. successor in interest to J.P. Morgan
Trust Company, N.A. (successor in interest to The Chase Manhattan Trust Company, National Association), a national banking association, as trustee (the “Original Trustee”), as supplemented by the Fifth Supplemental Indenture, dated
as of November 6, 2015 (the “Fifth Supplemental Indenture”), between the Company, Deutsche Bank Trust Company Americas, as series trustee (the “Trustee,” which term includes any successor trustee under the
Indenture with respect to a series of which this Note is a part), paying agent and transfer agent (the “Paying Agent” and/or the “Transfer Agent”) and Deutsche Bank Trust Company Americas as security registrar (the
“Security Registrar”), and as it may be supplemented from time to time (herein called, collectively, the “Indenture”), to which indenture and all indentures supplemental thereto,

  
 Exhibit A-1-1 

 
reference is hereby made for a statement of the respective rights, limitations of rights, duties and immunities thereunder of the Company, the Trustee and the Holders of the Securities, and of
the terms upon which the Securities are, and are to be, authenticated and delivered. This Note is one of a duly authorized series of Securities designated as “1.800% Senior Notes due 2022” (collectively, the “Notes”). 

Optional Redemption. The Company may redeem the Notes at its option at any time, in whole or from time to time in part, at a
redemption price (the “Optional Redemption Price”) equal to the sum of: 
 (i) 100% of the principal amount
of the Senior Notes being redeemed plus unpaid interest, if any, accrued thereon to, but excluding, the redemption date; and 

(ii) the Make-Whole Amount (as defined below) if any, with respect to such Senior Notes. 

If the Senior Notes are redeemed on or after August 7, 2022, the Optional Redemption Price will not include the Make-Whole Amount. 

“Make-Whole Amount” means, in connection with any optional redemption of the Senior Notes, the excess, if any, of: 

(i) the aggregate present value as of the date of redemption of each euro of principal being redeemed and the amount of
interest, excluding unpaid interest, if any, accrued thereon to, but excluding, the date of redemption that would have been payable in respect of each euro if the redemption payment had not been made (determined by discounting, on an annual basis
(ACTUAL/ACTUAL (ICMA) (as defined in the rulebook of the International Capital Markets Association)), the principal and interest at the Reinvestment Rate, from the respective dates on which the principal and interest would have been payable if the
redemption payment had not been made, to the date of redemption), over 
 (ii) the aggregate principal amount of the Senior
Notes being redeemed. 
 “Reinvestment Rate” means the Comparable Government Bond Rate plus 0.30%. 

“Comparable Government Bond” means, in relation to any Comparable Government Bond Rate calculation, at the discretion of an
independent investment bank selected by the Company, a German Bundesanleihe security whose maturity is closest to the maturity of the Notes, or if such independent investment bank in its discretion determines that such similar bond is not in
issue, such other German Bundesanleihe security as such independent investment bank may, with the advice of three brokers of, and/or market makers in, German Bundesanleihe securities selected by such independent investment bank,
determine to be appropriate for determining the Comparable Government Bond rate. 
 “Comparable Government Bond Rate” means
the price, expressed as a percentage (rounded to three decimal places, with 0.0005 being rounded upwards), at which the gross redemption yield on the Notes, if they were to be purchased at such price on the third Business

  
 Exhibit A-1-2 

 
Day prior to the date fixed for redemption, would be equal to the gross redemption yield on such Business Day of the Comparable Government Bond on the basis of the middle market price of the
Comparable Government Bond prevailing at 11:00 a.m. (London time) on such Business Day as determined by an independent investment bank selected by the Company. 

If the Company has given notice of redemption as provided in the Indenture and has made funds available on the redemption date referred to in
the notice for the redemption, the Notes called for redemption shall cease to bear interest on the redemption date and the Holders of those Notes from and after the redemption date shall be entitled to receive only the payment of the Optional
Redemption Price upon surrender of the Notes in accordance with the notice. 
 The Company shall give notice of any optional redemption to
Holders of Notes, at their addresses, as shown in the Register for the Notes, not more than 60 nor less than 30 days prior to the redemption date. The notice of redemption will specify, among other items, the Optional Redemption Price and the
principal amount of the Notes held by the Holder to be redeemed. 
 If the Company chooses to redeem less than all of the Senior Notes, it
shall notify the Trustee in writing at least 45 days prior to giving notice of redemption, or a shorter period as may be satisfactory to the Trustee, of the aggregate principal amount of Senior Notes to be redeemed and their redemption date. The
Trustee shall select, in accordance with its customary procedures, the Notes to be redeemed in part, which, in the case of Senior Notes in book-entry form, will be in accordance with the procedures of any applicable depositary. 

Change of Control Repurchase Event. This Note shall be repurchased by the Company upon the occurrence of a Change of Control
Repurchase Event (as defined in the Indenture) on the terms and conditions set forth in the Indenture. 
 Events of Default.
If an Event of Default with respect to the Notes shall have occurred and be continuing, the principal of the Notes may be declared due and payable in the manner and with the effect provided in the Indenture. 

Modification and Waivers; Obligations of the Company Absolute. The Indenture permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the rights and obligations of the Company and the rights of the Holders of the Securities of each series. Such amendment may be effected under the Indenture at any time by the Company and the
Trustee with the consent of the Holders of not less than a majority in aggregate principal amount of all Securities issued under the Indenture at the time Outstanding and affected thereby. The Indenture also contains provisions permitting the
Holders of not less than a majority in aggregate principal amount of all Outstanding Securities affected by certain provisions of the Indenture, on behalf of the Holders of all such Outstanding Securities, to waive compliance by the Company with
such provisions. Furthermore, provisions in the Indenture permit the Holders of not less than a majority in aggregate principal amount of the Outstanding Securities of an individual series to waive on behalf of all of the Holders of Securities of
such individual series certain past defaults under the Indenture and their consequences. Any such consent or waiver applicable to the Notes shall be conclusive and binding upon the Holder of this Note and upon all future Holders of this Note and of
any Note issued upon the registration of transfer hereof or in exchange hereof or in lieu hereof, whether or not notation of such consent or waiver is made upon this Note. 

  
 Exhibit A-1-3 

 No reference herein to the Indenture and no provision of this Note or of the Indenture shall
alter or impair the obligation of the Company, which is absolute and unconditional, to pay the principal of and premium, if any, and interest on this Note at the times, place and rate, and in the coin or currency herein prescribed. 

Defeasance and Covenant Defeasance. The Indenture contains provisions for defeasance at any time of (a) the entire
indebtedness of the Company on this Note and (b) certain restrictive covenants and the related defaults and Events of Default, upon compliance by the Company with certain conditions set forth therein, which provisions apply to this Note. 

Authorized Denominations. The Notes are issuable only in registered form without coupons in denominations of €100,000 or
any amount in excess thereof which is an integral multiple of €1,000. 
 Registration of Transfer or Exchange. As
provided in the Indenture and subject to certain limitations herein and therein set forth, the transfer of this Note is registrable in the Security Register upon surrender of this Note for registration of transfer at the office or agency of the
Company in any place where the principal of and premium, if any, and interest on this Note are payable, duly endorsed by, or accompanied by a written instrument of transfer in form satisfactory to the Company and the Security Registrar duly executed
by, the Holder hereof or his attorney duly authorized in writing, and thereupon one or more new Notes, of authorized denominations and for the same aggregate principal amount, will be issued to the designated transferee or transferees. 

As provided in the Indenture and subject to certain limitations herein and therein set forth, the Notes are exchangeable for a like aggregate
principal amount of Notes of different authorized denominations, as requested by the Holders surrendering the same. 
 Defined
Terms. All terms used in this Note (except as herein otherwise expressly provided or unless the context otherwise requires) which are defined in the Indenture and are not otherwise defined herein shall have the meanings assigned to them in
the Indenture. 
 Governing Law. This Note shall be governed by and construed in accordance with the laws of the State of New
York. 
 Unless the certificate of authentication hereon has been executed by the Trustee by manual signature, this Note shall not be
entitled to any benefit under the Indenture or be valid or obligatory for any purpose. 

  
 Exhibit A-1-4 

 IN WITNESS WHEREOF, the Company has caused this Note to be duly executed and attested. 

Dated: November 6, 2015 
  

			
	BORGWARNER INC.
		
	By:	 	  

	Name:	 	
	Title:	 	

  

			
	Attest:	 	  

		 	Secretary

 TRUSTEE CERTIFICATE 

OF AUTHENTICATION 
 This is one of the Securities
of the series designated therein referred to in the within-mentioned Indenture 
  

			
	DEUTSCHE BANK TRUST COMPANY AMERICAS, as Trustee
		
	By:	 	  

		 	Authorized Signatory

  
 Exhibit A-1-5 

 OPTION OF HOLDER TO ELECT PURCHASE 

If you want to elect to have this Note purchased by the Company pursuant to Section 3.02 (Change of Control Repurchase Event) of the
Fifth Supplemental Indenture, check the box below: 
 [    ] Section 3.02 

If you want to elect to have only part of the Note purchased by the Company pursuant to Section 3.02 of the Fifth Supplemental Indenture,
state the amount you elect to have purchased: 
  

€                       
  
  

							
	Date:                     	 		 	Your Signature:	 	  

		 		 	(Sign exactly as your name appears on the Note)
	
	Tax Identification Number:                         
			
	Signature guarantee:
                                         
   	 		 	
			
		 		 	(Signature must be guaranteed by a participant in a recognized signature guarantee medallion program

  
 Exhibit A-2-1Exhibit 10.1

 

Activision Blizzard, Inc.
 U.S. Corporate Annual Incentive Plan

(effective Fiscal Year 2015)
  ________________________________________________________

 

I.                                        Introduction:  Activision Blizzard, Inc. (“Activision Blizzard” or “Company”, and together with its subsidiaries, the “Activision Blizzard Group”), is the sponsor of this U.S. Corporate Annual Incentive Plan (“CAIP” or “Plan”).  The Plan is completely discretionary, and Activision Blizzard acting through its executive management team pursuant to its then-current governance practices (which may include approval from the Compensation Committee of the Board of Directors of Activision Blizzard (the “Compensation Committee”), as applicable) always retains the authority to act within its discretion in all aspects of operating this Plan (even if not explicitly stated in any specific provision below).  Although the provisions of the Plan as described below reflect the current methodology by which Activision Blizzard operates the Plan, Activision Blizzard retains the right to change, amend, or terminate the Plan at any time with or without notice, and regardless of whether or not work has been initiated or even completed with respect to goals or objectives.  Activision Blizzard retains the exclusive right to interpret the Plan in its sole discretion, and its determination will be final and binding.  Any and all exceptions to the operation of this Plan will be determined solely by the executive management team of the Company, pursuant to its then-current governance practices in effect at the time the decision is made.

 

II.                                    Effective Date and Location:  This Plan is effective as of Fiscal Year 2015, and shall remain effective until Activision Blizzard determines otherwise.  The Plan is applicable only in the U.S.

 

III.                                Eligibility:  Any U.S. employee (except as provided for in subparagraph A below) of the Activision Blizzard Group is eligible to receive an annual incentive bonus payment under the Plan for a “Plan Year”, if and only if each individual is allocated an award by the Company.   For purposes of this Plan, a “Plan Year” will run concurrent with the fiscal year.1  Since the incentive bonus rewards not only success, but also continued service and ongoing contributions to the Activision Blizzard Group, an employee is eligible to receive and may earn an incentive bonus payment only if he or she is employed with the Activision Blizzard Group on the incentive bonus payment date with respect to such bonus payment.

 

A.                                  Eligibility Exceptions:

 

1)                                   Employees who begin employment with the Activision Blizzard Group after September 30th are ineligible to participate for that Plan Year;

 

2)                                   Temporary employees of the Activision Blizzard Group (whether or not party to a temporary employment agreement) are ineligible to participate; and

 

3)                                   As a general principle, employees who participate in other Activision Blizzard Group bonus plans, such as a studio retention and incentive bonus plan or the Blizzard Entertainment Profit Sharing Plan, will not be allocated an award under this Plan.

 

 

____________________________

 

1 As with all financial metrics, the Company reserves the full discretion to define the term associated with a fiscal year.  Currently, Activision Blizzard’s fiscal year runs concurrent with the calendar year, but the Company retains the full discretion to change this in the future.

 

 

 

________________________________________________________

Page 1

 

B.                                  No Entitlement:  No employee shall be entitled to a payment pursuant to this Plan under any circumstances unless and until a payment actually is made.  Specifically, prior notification of the Plan itself or individual Plan eligibility, or prior participation in the Plan, does not create any entitlement to future participation.

 

IV.                              Funding:

 

A.                                  General:  The Plan will fund at a discretionary level determined by the Company for a Plan Year (hereinafter, the “Pool”) if the Compensation Committee determines that the Company’s actual operating income (“OI”, as defined by the Company) for that fiscal year equals or exceeds a percentage (to be determined by the Compensation Committee in Q1 of each fiscal year) of the target goal amount set forth in the Company’s annual operating plan (“AOP”) for the Plan Year (the “Company Cut-In”).  The determination as to whether the Company Cut-In has been met is typically made by the Compensation Committee in the first quarter of the fiscal year following the Plan Year, or at a time determined by the Company pursuant to its then-current governance practices in effect.  The Company retains the option of funding the Plan even in the event that it is determined that less than the Company Cut-In is achieved.

 

B.                                  Reservation:  In the event that any funds are set aside by the Company for the payment of bonuses under this Plan, the Company reserves the right not to allocate or not to pay out any portion of those funds.  Should any funds from a Pool remain unallocated or unspent, Activision Blizzard also reserves the right to determine what Activision Blizzard may do with those funds, if anything, including without limitation, using those funds for other corporate purposes; no Participant or any beneficiary thereof will have any right or interest in or to any such assets or amounts.

 

V.                                  Allocations:  Typically an employee will be recommended for an incentive bonus award (or allocation) by his or her manager or management team.  The nomination will require internal approval per the Company’s then-current governance practices.  Recommendations for a Plan Year generally are made in the first quarter of the following year, or at a time determined by the Company pursuant to its then-current governance practices in effect.  To determine the incentive bonus award recommendation for each relevant employee, managers generally should consider the following:

 

A.                                  Target Bonus:  The Company normally provides each eligible employee (or “Participant”) with a target bonus for each Plan Year (“Target Bonus”) that is expressed as a percentage of his or her “Base Salary” (as defined in Paragraph V.A.2 below) for that year.  Target Bonuses may vary from Participant to Participant depending on a Participant’s job level or any other factor the Company deems to be relevant.

 

1)                             Modification of Target Bonus.  The Company may opt to modify any Participant’s Target Bonus at any time during the Plan Year, subject to the approval process provided for under the Company’s then-current governance practices, at the Company’s discretion or as required by the Company’s then-current governance practices.

 

2)                             Base Salary:  For purposes of this Plan, the Base Salary earned by a Participant for purposes of calculating an incentive bonus payment for a specific Plan Year will be defined by the Company in its discretion.

 

 

 

________________________________________________________

Page 2

 

B.                                  Performance Metrics:  The following performance metrics normally will be evaluated by managers (or as otherwise provided for by the Company’s then-current governance practices) when determining the recommended level of payout for a Participant relative to his or her Target Bonus:  1) attainment of the Company’s financial objectives; 2) attainment of relevant business financial objectives; and 3) attainment of the employee’s individual performance objectives.  Other factors may also be taken into consideration, as consistent with the Company’s then-current governance practices. The specific financial and individual performance objectives to be utilized and the relative weighting of the various objectives may vary from Participant to Participant depending on the department or unit to which the Participant provides services, a Participant’s job level, or any other factor the Company deems to be relevant.  The Company, pursuant to its then-current governance practices, may modify any metrics assigned to a Participant at any time during the Plan Year

 

1)                                   Corporate Financial Objectives:  The Company’s management (with the approval of the Compensation Committee) will establish financial performance objectives for Activision Blizzard with respect to each Plan Year.  Following the close of each Plan Year, achievement of these financial objectives for that Plan Year normally will be confirmed by the Compensation Committee (usually in Q1 of the following year) or as is consistent with the Company’s then-current governance practices.

 

2)                                   Business Financial Objectives (Where Applicable):  The Company’s management (with the approval of the Compensation Committee where required by the Company’s then-current governance practices) will establish financial performance objectives and associated achievement levels for various operating and business units, regions, teams, and territories (all as defined by the Company).  Following the close of each Plan Year, achievement of these financial objectives for that Plan Year will be confirmed by the Compensation Committee (usually in Q1 of the following year) or as is consistent with the Company’s then-current governance practices.  In order for this metric to fund, a relevant organization must achieve a minimum percentage (to be determined by the Company) of its AOP financial target set by the Company (the “BU Cut-In”).  For Plan Year 2015, the BU Cut-In is 75% of AOP OI for the relevant organization.

 

3)                                   Individual Performance Objectives:  Individual performance objectives normally will be developed by each Participant and his or her immediate manager (or management team) for each Plan Year; such objectives are subject to review pursuant to the Company’s then-current governance practices.  Following the close of each Plan Year, achievement of a Participant’s personal objectives will be determined by the Participant’s manager/management team, subject to the approval process provided for under the Company’s then-current governance practices.

 

4)                                   Achievement levels:  The Participant’s manager/management team may recommend and the Company may determine that a Participant does not receive an incentive bonus for that Plan Year, or receives an incentive bonus which is less than his or her Target Bonus, if the Company determines that i) one or more of the objectives in a Participant’s Bonus Plan are not achieved; ii) the Participant’s performance rating (provided in conjunction with the Company’s performance review process) for a Plan Year is Below Expectations; iii) the Participant has violated any Company policy, procedure, rule, or regulation during his or her employment or any post-employment restrictions (where applicable, as discussed in Paragraph VIII.B. below); or iv) other reasons bear consideration, unless any of the above are prohibited by applicable law.

 

VI.                              Payments:

 

 

 

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A.                                  Schedule:  Incentive bonus payments, if any, will be paid in a lump sum, less applicable taxes and withholdings on a schedule to be determined by the Company.

 

B.                                  Employment Required:  Since the Plan rewards not only the achievement of pre-established goals that contribute to the Company’s success, but also continued service and ongoing contributions to the Activision Blizzard Group, an employee who is allocated an incentive bonus payment must be employed with the Activision Blizzard Group on the payment date of such incentive bonus payment, unless an exception is (i) provided for under the Company’s then-current severance plan (if any), (ii) approved by Company management, pursuant to then-current governance practices, , or (iii) is otherwise required by law.  For the avoidance of doubt, once an incentive bonus payment to an individual has been approved by the Company, in no event will such incentive bonus payment be made to an employee later than March 15 of the year following the applicable Plan Year based upon the current fiscal year (though the Company retains full discretion to change this should it modify the definition of a fiscal year).

 

VII.                          Appeal:  If a Participant disagrees with the incentive bonus award allocation (if any) made to him or her pursuant to this Plan, the Participant must notify his or her manager or assigned HR Generalist of such dispute within 14 days after the date that the incentive bonus award allocation is communicated to him or her.  To the extent no such notice is received by the Company within 14 days after the date such communication is made, such determination will conclusively be deemed final and binding on the Company and that Participant.  If a notice is received within such 14-day period, then the manager or HR Generalist will promptly investigate the Participant’s concerns and communicate back to the Participant a determination (which shall be made pursuant to the Company’s then-current governance practices), and such determination shall be final and binding.  Without limiting the generality of the foregoing, no Participant will have any right, unless provided otherwise by law, to inspect the books, records, budgets, business plans, financial data or financial statements of the Activision Blizzard Group to determine whether any financial determinations are correct with respect to any fiscal year.

 

VIII.                      Miscellaneous:

 

A.                                  Modification or Termination of Plan:  Activision Blizzard, as the sponsor of the Plan, reserves the right to change, amend, or terminate the Plan at any time with or without notice, and regardless of whether or not work has been initiated or even completed with respect to goals or objectives.  Activision Blizzard reserves the right to suspend or terminate all payments in the event of change, amendment, or termination of the Plan.  Activision Blizzard retains the exclusive right to interpret the Plan in its sole discretion, and its determination will be final and binding.  Any prior course of dealings shall not be determinative in interpreting this Plan; no participant shall be entitled to rely on any past practices associated with administering the Plan (or any similar plans) to interpret this Plan.

 

B.                                  At-Will Employment:  Nothing contained in this Plan implies a contractual agreement between the Activision Blizzard Group and an employee or confers upon any such individual the right to continued employment.  For individuals not employed pursuant to an employment agreement, this Plan in no way alters the at-will employment status of his or her employment.  An employee or the Activision Blizzard Group may terminate employment at any time, with or without cause or notice, unless an employee’s employment agreement states otherwise.

 

C.                                 Conflicts:  This Plan supersedes all prior oral or written communications on this same subject matter.  To the extent that this Plan conflicts with the Activision Blizzard Group’s policies, 

 

 

 

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procedures, rules, or regulations, the latter shall control.  To the extent that this Plan may conflict with an employee’s employment agreement with the Activision Blizzard Group, the terms of the employment agreement shall control.

 

D.                                 Inapplicability of ERISA.  This Plan is intended to be a “bonus program” and “payroll practice” and, as such, is not subject to the Employee Retirement Income Security Act of 1974, as amended.

 

E.                                  409A Compliance:  To the extent applicable, it is intended that the Plan comply with the provisions of Sections 409A of the Internal Revenue Code, as amended.  The Plan will be administered and interpreted in a manner consistent with this intent.  Specifically, any provision that would cause the Plan to fail to satisfy Section 409A will have no force and effect until amended to comply therewith (which amendment may be retroactive to the extent permitted by Section 409A).

 

F.                                   Relationship to 2014 Incentive Plan and Section 162(m).  This Plan is intended to be operated as a means to effect negative discretion with respect to Senior Executive Plan Bonuses, as defined in and granted under the Company’s 2014 Incentive Plan (the “2014 Plan”, or any other successor plan that is shareholder approved) and, when this Plan is used in connection with any Senior Executive Plan Bonus, this Plan shall be interpreted consistently with, and shall be subject to the terms and limitations of, the 2014 Plan and any actions taken by the Compensation Committee in connection with the award or payment of such Senior Executive Bonus Plan.  In the event of any conflict between the terms of this Plan and the 2014 Plan with respect to any Senior Executive Plan Bonus, the terms of this Plan shall control, except where necessary to preserve the status of the Senior Executive Plan Bonus as “qualified performance-based compensation” under Section 162(m) of the Internal Revenue Code, as amended.

 

G.                                Taxation:  The Activision Blizzard Group may withhold from any payments made under this Plan all federal, state, city or other applicable taxes or amounts as shall be required or permitted pursuant to any law, governmental regulation or ruling or agreement with an employee.  Likewise, the Activision Blizzard Group may withhold payments hereunder or seek reimbursement from a Participant to recover improper payments or over-payments made.

 

H.                                 Effect on Other Activision Blizzard Group Benefits Programs:

 

1)  No incentive bonus payment under this Plan will be considered salary or other compensation paid to an employee for purposes of computing any benefits to which he or she may be entitled under any employee benefit or retirement plan which may be maintained by the Activision Blizzard Group from time to time, except for those benefit plans which explicitly provide for otherwise.

 

2)  Participation in this Plan does not confer rights to participation in other programs which may be maintained by the Activision Blizzard Group from time to time, including but not limited to other annual or long-term incentive plans, non-qualified retirement or deferred compensation plans or other executive perquisite programs.

 

I.                                        Non-Exclusivity.  Neither the adoption of this Plan by the Company nor any provision of this Plan will be construed as creating any limitations on the power of the Company to adopt such additional compensation arrangements as it may deem desirable.

 

 

 

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J.                                    Construction:  The headings set forth herein are included solely for the purpose of identification and shall not be used for the purpose of construing the meaning of the provisions of this Plan.  The masculine gender, wherever appearing in this Plan, will include the feminine gender and the singular will include the plural, unless the context clearly indicates to the contrary.

 

K.                                  Governing Law:  Except to the extent governed by federal law, this Plan shall be governed by and construed in accordance with the laws of the State of California, or, for individuals employed outside of California, the state in which an employee was last employed by the Activision Blizzard Group, without regard to conflict of law principles.

 

L.                                    Severability:  If any provision of this Plan is held to be illegal, invalid or unenforceable, such provisions shall be fully severable, the Plan shall be construed and enforced as if such illegal, invalid or unenforceable provision had never comprised a part of this Plan, and the remaining provisions of this Plan shall remain in full force and effect and shall not be affected by the illegal, invalid or unenforceable provision or by its severance from this Plan.  Furthermore, in lieu of such illegal, invalid or unenforceable provision, a court or arbitrator shall add automatically as part of this Plan a legal and enforceable provision as similar in terms to such illegal, invalid or unenforceable provision as may be possible.

 

M.                               Assignment:  This Plan and the rights and obligations hereunder shall not be assignable or transferable by any employee, unless provided for otherwise by Activision Blizzard in writing and signed by the Chief Executive Officer of Activision Blizzard.  Activision Blizzard may assign this Plan or all or any part of its rights and obligations under this Plan at any time and following such assignment all references to Activision Blizzard shall be deemed to refer to such assignee and Activision Blizzard shall thereafter have no obligation under this Plan.

 

N.                                 Successors:  This Plan shall be binding on and inure to the benefit of Activision Blizzard and its successors and assigns, including successors by merger and operation of law.

 

ACTIVISION BLIZZARD, INC.

 

 

	
/s/ Thomas Tippl                                  
    	
 
    	
               9/2/15               
    	
 
    
	
Thomas   Tippl, Chief Operating Officer
    	
Date
    
	
 
    	
 
    

 

 

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