Document:

EX-10.3

 Exhibit 10.3 
 Execution Copy 
 Settlement Agreement 

(the “Settlement Agreement”) 
 Milbank, Tweed, Hadley & McCloy LLP 
 Taunusanlage 15 

60325 Frankfurt am Main, Germany 

 Settlement Agreement 

dated as of February 15, 2013 
 by and among 
  

	1.	Deutsche Balaton AG, a stock corporation organized under the laws of the Federal Republic of Germany, with its seat in Heidelberg and its business address at
Ziegelhäuser Landstraße 1, 69120 Heidelberg, and registered with the commercial register of the local court of Mannheim under HRB 338172 (“Balaton”) 

 

	2.	Gentherm Incorporated, a corporation organized under the laws of the State of Michigan, USA, with its seat in Northville, USA and its business address at
Northville, Michigan, 21680 Haggerty Road, Ste. 101, 48167 USA (“Gentherm Inc.”) 

  

	3.	Gentherm Europe GmbH, a limited liability company organized under the laws of the Federal Republic of Germany, with its seat in Augsburg and its business address
at Ulmer Straße 160B, 86156 Augsburg, and registered with the commercial register of the local court of Augsburg under HRB 25596 (“Gentherm Europe”) 

- the parties under 2. and 3. collectively “Gentherm” - 

- Balaton, Gentherm Inc. and Gentherm Europe each a “Party” and, 

collectively, the “Parties” - 

  
 2 

 Table of Contents 

 

					
	 1. Definitions
	  	 	7	  
	 2. Increase of the DPLTA Cash Consideration
	  	 	8	  
	 3. No Exercise of DPLTA Put Option by Balaton
	  	 	10	  
	 4. Withdrawal of Balaton Actions
	  	 	10	  
	 5. Further Undertakings of Balaton
	  	 	11	  
	 6. Costs
	  	 	12	  
	 7. Application of Framework Agreement
	  	 	12	  

  
 3 

 List of Annexes 

 

			
	 	 
	 Annex

 
	  	 Topic

 

	 	 
	 Annex P.11

 
	  	Executed Framework Agreement
	 	 
	 Annex 2.1

 
	  	Letter of Comfort
	 	 
	 Annex 4.1

 
	  	Declarations of Withdrawal

  
 4 

 Preamble 

 

	P.1	Whereas, Gentherm Inc. holds all shares in Gentherm Europe. 

  

	P.2	Whereas, Gentherm Europe holds 2,429,403 of the bearer shares with no par value (auf den Inhaber lautende Aktien ohne Nennbetrag
(Stückaktien)) in W.E.T. Automotive Systems A.G., a stock corporation organized under the laws of the Federal Republic of Germany with its seat in Odelzhausen, its business address at Rudolf-Diesel-Str. 12, 85235 Odelzhausen and
registered with the commercial register of the local court of Munich under HRB 119793 (the “Company”) and Gentherm Inc. holds 2,660 of the bearer shares with no par value (auf den Inhaber lautende Aktien ohne Nennbetrag
(Stückaktien)) in the Company. The Company has a registered share capital of EUR 9,600,000 divided into 3,200,000 bearer shares with no par value (each a “W.E.T. Share”), which are admitted for trading in the Regulated
Market of the Frankfurt Stock Exchange. 

  

	P.3	Whereas, Balaton holds 442,253 of the W.E.T. Shares (the “Shares”), which are booked on deposit accounts in different banks in Germany.

  

	P.4	Whereas, Gentherm Europe (then named Amerigon Europe GmbH) as controlling entity and the Company as controlled entered into a domination and profit and loss
transfer agreement on June 16, 2011 (the “DPLTA”). 

  

	P.5	Whereas, pursuant to Sec. 305 AktG of the German Stock Corporation Act (Aktiengesetz—“AktG”) in conjunction with § 5 of
the DPLTA, Gentherm Europe is obliged to acquire, upon demand of an outside shareholder of the Company, such outside shareholder’s W.E.T. Shares against a consideration in cash (the “DPLTA Put Option” and the “DPLTA
Cash Consideration”, respectively). Pursuant to § 5.1 of the DPLTA, the DPLTA Cash Consideration amounts to EUR 44.95 per W.E.T. Share for which the DPLTA Put Option is exercised. The DPLTA Put Option can only be exercised
upon the DPLTA having become effective. 

  

	P.6	Whereas, the annual shareholders’ meeting of the Company dated August 16, 2011 (the “2011 Shareholders’ Meeting”) has adopted,
inter alia, the following resolutions: 

  

	 	-	 	 resolutions under agenda item 3 and agenda item 4 on the discharge of the members of the executive board of the Company and the members of the advisory
board of the Company, respectively, for fiscal year 2010 (the “Discharge Resolutions 2011”), and 

  

	 	-	 	 resolution under agenda item 6 on the approval of the DPLTA (the “DPLTA Approval Resolution”). 

  
 5 

	P.7	Whereas, the annual shareholders’ meeting of the Company dated June 14, 2012 (the “2012 Shareholders’ Meeting”) has adopted,
inter alia, the following resolutions: 

  

	 	-	 	 resolutions under agenda item 3 and agenda item 4 on the discharge of the members of the executive board of the Company and the members of the advisory
board of the Company, respectively, for fiscal year 2011 (the “Discharge Resolutions 2012”), and 

  

	 	-	 	 resolution under agenda item 6 on the confirmation pursuant to Sec. 244 AktG of the DPLTA Approval Resolution (the “Confirmatory
Resolution”). 

  

	P.8	Whereas, following the 2011 Shareholders’ Meeting, Balaton filed a challenge and voidance action (Anfechtungs- und Nichtigkeitsklage) with the
Regional Court Munich I (Landgericht München I) (file no. 5 HK O 20488/11) against the Company with respect to the Discharge Resolutions 2011 and the DPLTA Approval Resolution (the “Balaton Court Action 2011”).
By first instance decision of the Regional Court Munich I (Landgericht München I) dated April 5, 2012, the court declared the DPLTA Approval Resolution void, but dismissed the Balaton Court Action 2011 with respect to the
Discharge Resolutions 2011. Each of the Company and Balaton appealed against this first instance decision to the Higher Regional Court of Munich (Oberlandesgericht München) (file no. 7 U 1805/12). Such appeal has not yet been
decided on. 

  

	P.9	Whereas, following the 2012 Shareholders’ Meeting, Balaton filed a challenge and voidance action (Anfechtungs- und Nichtigkeitsklage) with the
Regional Court Munich I (Landgericht München I) (file no. 5 HK O 14081/12) against the Company with respect to the Discharge Resolutions 2012 and the Confirmatory Resolution (the “Balaton Court Action
2012”). 

  

	P.10	Whereas, Balaton, furthermore, filed two applications with the Regional Court Munich I (Landgericht München I) (file no. 17 HK O 27730/11
and 17 HK O 16045/12) against the Company each regarding the appointment of a special auditor pursuant to Sec. 142 para. 2 AktG (the “Balaton Court Applications” and, together with the Balaton Court Action 2011 and the
Balaton Court Action 2012, the “Balaton Actions”). By first instance decision of the Regional Court Munich I dated January 17, 2013 one of the Balaton Court Applications (file no. 17 HK O 27730/11) was dismissed. The
other Balaton Court Application (file no. 17 HK O 16045/12) has not yet been decided on. 

  

	P.11	 Whereas, while holding up their respective legal positions regarding the subject matters of the various Balaton Actions, the Parties intend to
finally settle all 

  
 6 

	 	
Balaton Actions and in this connection have signed a framework agreement, which is attached to this Settlement Agreement as Annex P.11 (the “Framework Agreement”).

  

	P.12	Whereas, in order to allow for the other outside shareholders of the Company a benefit of the reached Agreement, Gentherm has proposed and agreed to offer such
outside shareholders of the Company an additional payment provided for in Section 2.1 to 2.7. 

 Now, therefore, it is
agreed as follows: 
 1. 
 Definitions 
 “2011 Shareholders’ Meeting” is defined in Section P.6.

 “2012 Shareholders’ Meeting” is defined in Section P.7. 
 “Additional Cash Consideration” is defined in Section 2.1. 

“AktG” is defined in Section P.5. 
 “Balaton” is defined in the Recitals. 
 “Balaton Actions” is
defined in Section P.10. 
 “Balaton Court Action 2011” is defined in Section P.8. 

“Balaton Court Action 2012” is defined in Section P.9. 
 “Balaton Court Applications” is defined in Section P.10. 
 “Balaton
Documentation” is defined in the Framework Agreement. 
 “Company” is defined in Section P.2. 

“Confirmatory Resolution” is defined in Section P.7. 
 “Court Increase Amount” is defined in Section 2.3. 
 “Discharge
Resolutions 2011” is defined in Section P.6. 
 “Discharge Resolutions 2012” is defined in Section P.7. 

“DPLTA” is defined in Section P.4. 
 “DPLTA Approval Resolution” is defined in Section P.6. 
 “DPLTA Put
Option” is defined in Section P.5. 
 “DPLTA Cash Consideration” is defined in Section P.5. 

“Framework Agreement” is defined in Section P.11. 
 “Gentherm” is defined in the Recitals. 
 “Gentherm Europe” is
defined in the Recitals. 

  
 7 

 “Gentherm Inc.” is defined in the Recitals. 

“Parties” is defined in the Recitals. 
 “Party” is defined in the Recitals. 
 “Shares” is defined in
Section P.3. 
 “SpruchG” is defined in Section 2.3. 
 “Total Cash Consideration” is defined in Section 2.1. 
 “W.E.T.
Share” is defined in Section P.2. 
 2. 
 Increase of the DPLTA Cash Consideration 
  

	2.1	Gentherm Europe shall pay to each outside shareholder of the Company who exercises the DPLTA Put Option, in addition to the DPLTA Cash Consideration as set forth in
§ 5.1 of the DPLTA, a further consideration in cash in the amount of EUR 40.05 per W.E.T. Share for which the DPLTA Put Option is exercised by such outside shareholder (the “Additional Cash Consideration”). The total
amount of the DPLTA Cash Consideration and the Additional Cash Consideration payable per W.E.T. Share for which the DPLTA Put Option is exercised, therefore amounts, subject to the following paragraphs, to EUR 85.00 (the “Total Cash
Consideration”). Gentherm Inc. shall issue another letter of comfort (Patronatserklärung), attached hereto as Annex 2.1, which covers the total Additional Cash Consideration. 

 

	2.2	The Additional Cash Consideration shall become payable together with the DPLTA Cash Consideration and under the same terms and conditions, under which the DPLTA Cash
Consideration becomes payable. However, no interest pursuant to Sec. 305 para. 3 sentence 3 AktG shall accrue on the Additional Cash Consideration; other statutory claims for interest on the Additional Cash Consideration (e.g. because
undue payment (Zahlungsverzug)) shall remain unaffected. 

  

	2.3	Should the competent court in an appraisal proceeding pursuant to Sec. 1 no. 1 of the German Act on Appraisal Proceedings (Spruchgesetz –
“SpruchG”) determine by non-appealable decision a consideration pursuant to Sec. 305 AktG exceeding the DPLTA Cash Consideration, or should such a consideration be agreed upon in a settlement of such appraisal proceeding or in
order to avert such an appraisal proceeding, (the amount exceeding the DPLTA Cash Consideration, the “Court Increase Amount”), the Additional Cash Consideration shall be set off against such Court Increase Amount.

  
 8 

	2.4	Furthermore, the Additional Cash Consideration shall be set off against any interest accrued pursuant to Sec. 305 para. 3 sentence 3 AktG on the DPLTA Cash
Consideration and/or a Court Increase Amount. 

  

	2.5	The Additional Cash Consideration per W.E.T. Share payable to an outside shareholder exercising the DPLTA Put Option shall be reduced by the total amount of

  

	 	(i)	the cash compensations (Ausgleichszahlungen) per W.E.T. Share pursuant to Sec. 304 AktG paid to outside shareholders prior to the payment of the Additional Cash
Consideration to the relevant outside shareholder exercising the DPLTA Put Option; and 

  

	 	(ii)	dividend or other distributions per W.E.T. Share paid by the Company to its shareholders between the date of this Settlement Agreement and the payment of the Additional
Cash Consideration to the relevant outside shareholder exercising the DPLTA Put Option. 

  

	2.6	The Additional Cash Consideration shall be paid out to the outside shareholders of the Company, upon their exercise of the DPLTA Put Option, concurrently with the DPLTA
Cash Consideration. The payment shall be exclusively effected by wire transfer to the respective outside shareholder’s account with his depositary institute (depotführendes Institut) in exchange for re-booking the relevant W.E.T.
Shares from his securities account to the relevant securities account of Gentherm Europe. The payment shall be deemed to be effected already upon its receipt by the outside shareholder’s depositary institute. In the case of a German depositary
institute, the payment shall be effected free of costs and expenses for the outside shareholder; any additional charges (if any) charged by a non-German depositary institute, shall be borne by the respective outside shareholder.

  

	2.7	The provisions of this Sec. 2 shall constitute a genuine contract for the benefit of third parties (echter Vertrag zugunsten Dritter) within the meaning of
Sec. 328 of the German Civil Code in relation to the outside shareholders of the Company who are entitled to the Additional Payment pursuant to this Sec. 2. 

 

	2.8	In case Gentherm does not comply with its obligations owed to other outside shareholders in the Company as provided for in Sec. 2.1 through 2.7 of this Agreement and
such other outside shareholders raise, because of such non-compliance, claims against Balaton, Gentherm shall indemnify Balaton in an amount of 90% of all proven cost and expenses resulting from such claims of other outside shareholders in the
Company against Balaton. 

  
 9 

 3. 
 No Exercise of DPLTA Put Option by Balaton 
  

	3.1	Balaton, Gentherm Inc. and Gentherm Europe have agreed in a separate agreement on a sale of all Shares to Gentherm Europe against a cash payment and shares in Gentherm
Inc. as consideration. 

  

	3.2	In consideration thereof, Balaton hereby undertakes vis-à-vis each of Gentherm Europe and Gentherm Inc. not to exercise the DPLTA Put Option for any of the
Shares. 

  

	3.3	Furthermore, Balaton undertakes vis-à-vis each of Gentherm Europe and Gentherm Inc. not to exercise the DPLTA Put Option for any W.E.T. Shares Balaton may hold
in the future and to ensure that none of its current subsidiaries or affiliates (in the meaning of Section 290 German Commercial Code – HGB) will exercise the DPLTA Put Option for any W.E.T. Shares such subsidiaries or affiliates
may hold in the future; provided however, that any W.E.T. Shares held by subsidiaries or affiliates on the date hereof may be the subject of exercise of the DPLTA Put Option. The aforementioned obligation of Balaton in relation to subsidiaries shall
only apply to the extent legally possible. To the extent Balaton will acquire or otherwise own after the date hereof a subsidiary or affiliate in the meaning of Section 290 German Commercial Code (HGB) which owns shares in the Company,
Balaton shall procure that such subsidiary or affiliate shall sell the shares in the Company for a price of EUR 85 per share to Gentherm Europe GmbH instead of exercising the DPLTA Put Option for such shares. 

 

	3.4	The publications required in connection with the technical execution of the DPLTA and the DPLTA Put Option shall be handled by the Company and Gentherm Europe,
respectively. 

 4. 
 Withdrawal of Balaton Actions 
  

	4.1	Balaton hereby undertakes vis-à-vis each of Gentherm Inc. and Gentherm Europe to withdraw in full each of the Balaton Court Action 2011, the Balaton Court Action
2012 and the Balaton Court Applications by filing respective declarations of withdrawal (Klage- bzw. Antragsrücknahme) substantially as attached to this Settlement Agreement in draft form as Annex 4.1 with the respective
competent courts. 

  

	4.2	 Upon request of Gentherm Inc., Balaton shall declare its consent to the registration of the DPLTA vis-à-vis the commercial register and shall
make all other declarations and take all other measures reasonably requested by Gentherm Inc. which are necessary or expedient to allow for a swift registration of the DPLTA with the commercial register. However, this does not include any voting

  
 10 

	 	
rights instructions or constitutes an acting-in-concert; as long as Balaton owns the Shares, Balaton exclusively exercises the voting rights and is free and not bound as to its voting rights
pursuant to this Settlement Agreement. 

  

	4.3	Balaton undertakes vis-à-vis each of Gentherm Inc. and Gentherm Europe not to initiate (directly or indirectly) any further proceedings or investigations, and
not to assert or assign any claims or take any other legal steps, against the Company, Gentherm Inc., Gentherm Europe or any of their respective officers, directors, or other members of corporate bodies with respect to any matter which
(i) existed prior to the date hereof and are the subject of the Balaton Actions, or (ii) which exists on the date hereof and relates to the Company, or (iii) which exists on the date hereof and could reasonably be known to Balaton and
relates to Gentherm Inc. and Gentherm Europe. To the extent any such proceedings or investigations have already been initiated, or such claims made or steps taken, by Balaton or any of its subsidiaries, Balaton shall ensure that they are promptly
withdrawn or otherwise terminated, provided that this obligation shall apply to subsidiaries of Balaton to the extent legally possible. In particular, neither Balaton nor, to the extent legally possible, its subsidiaries or affiliates shall
challenge the validity or effectiveness, or claim the voidance, of the DPLTA, the DPLTA Approval Resolution or of any other resolution of the 2011 Shareholder’s Meeting, the 2012 Shareholder’s Meeting or of any other past, present or
future shareholders’ meeting of the Company. Furthermore, Balaton undertakes not to join or support in any manner any third party in connection with an action described in this Section 4.3, except for withdrawals or other terminations of
proceedings or investigations. 

  

	4.4	Upon execution of all actions provided for in Section 5.2 and 5.3 of the Framework Agreement, all claims of Balaton relating to the Balaton Actions or otherwise in
connection with Balaton’s shareholding in the Company or any actions of the officers, directors or other members of the corporate bodies of Gentherm Inc., Gentherm Europe or the Company and their termination are settled and, as a matter of
precaution to the extent still existing after the execution of the actions provided for in Section 5.2 and 5.3 of the Framework Agreement, are hereby waived, such waiver hereby accepted by Gentherm Inc. as the representative of any of the
aforementioned legal and natural persons who are not party to this Agreement. 

 5. 

Further Undertakings of Balaton 
  

	5.1	Balaton undertakes vis-à-vis each of Gentherm Inc. and Gentherm Europe, not to acquire or offer to acquire (in either case, directly or indirectly) any shares in
the Company for a period of four years. 

  
 11 

	5.2	Balaton undertakes vis-à-vis each of Gentherm Inc. and Gentherm Europe, not to undertake or support any action that would have the potential to reduce the number
of shareholders of the Company that exercise the DPLTA Put Option. Balaton also undertakes vis-à-vis each of Gentherm Inc. and Gentherm Europe, not to undertake or support any action that would have the potential to negatively impact the
execution and registration of a squeeze-out of minority shareholders in the Company. 

  

	5.3	Balaton shall, to the extent legally possible, impose the undertakings of Sections 4.2, 4.3, 5.1 and 5.2 on its respective legal successor. 

6. 

Costs 
  

	6.1	Balaton undertakes not to file an application for determination of costs by court (Kostenfestsetzungsantrag) in relation to any of the Balaton Actions.

  

	6.2	Gentherm Europe shall reimburse to Balaton the legal court fees payable by Balaton in relation to the Balaton Actions plus an additional lump sum of EUR 25,000 for
lawyer’s cost Balaton had in connection with the Balaton Actions (except for the legal court fees in relation to the Balaton Court Application with file no. 17 HK O 27730/11) upon respective invoice by Balaton (to which adequate evidence for
such court fees shall be attached). The above payment shall fall due within 10 banking days from the later of (i) the receipt of the respective invoice by Gentherm Europe and (ii) the registration of the DPLTA with the commercial register
of the Company. Gentherm indemnifies Balaton against all costs the Company claims from Balaton as a result of the withdrawal of any or all of the Balaton Actions, e.g., filed by an application for determination of costs by court
(Kostenfestsetzungsantrag) by the Company in relation to any of the Balaton Actions. 

  

	6.3	The provisions of Sec. 6.1 and Sec. 6.2 above are subject to the conditions precedent of the withdrawal of all Balaton Actions having been effected by Balaton
pursuant to Sec. 4.1 sentence 1 above and the condition that Balaton have complied, in all material respects, to each of its obligations under this Agreement and each of the other agreements of the Balaton Documentation.

  

	6.4	For the avoidance of doubt, the foregoing provisions shall not affect, and are not to the benefit of, any person involved in any of the Balaton Actions who is not a
Party (except for the Company). 

 7. 

Application of Framework Agreement 

  
 12 

 Sections 6 (Confidentiality), 8 (Notices), 9 (Choice of Law, Venue), 10 (Interpretation,
Formalities, Severability) and 11 (Miscellaneous) of the Framework Agreement shall apply to this Settlement Agreement mutatis mutandis. The Parties are aware that this Agreement becomes effective upon Publication as defined in the Framework
Agreement. 
 [remainder of page intentionally blank] 

  
 13 

 SIGNATURE PAGE – SETTLEMENT AGREEMENT 

IN WITNESS WHEREOF, the Parties have caused this Settlement Agreement to be signed by a duly authorized signatory thereof, all as of the
date first written above. 
  

					
	Deutsche Balaton AG	 		 	
			
	/s/ Jens Jüttner	 		 	
			
	Gentherm Europe GmbH	 		 	Gentherm Incorporated
			
	/s/ Peter Memminger, as representative based on a PoA	 		 	/s/ Peter Memminger, as representative based on a PoA

 Annex P.11 – Executed Framework Agreement 

[See the executed Framework Agreement which is part of this publication.] 

 Annex 2.1 – Letter of Comfort 

Gentherm Incorporated 
 21680 Haggerty Road, Ste. 101 
 Northville, Michigan, USA 

 

			
	 Patronatserklärung

 

1.      Die Gentherm Europe GmbH, eingetragen im Handelsregister des Amtsgerichts
Augsburg unter HRB 25596 (“Gentherm Europe”), hat mit der W.E.T. Automotive Systems Aktiengesellschaft, eingetragen im Handelsregister des Amtsgerichts München unter HRB 119793 (“W.E.T. AG”), haben am
16. Juni 2011 einen bisher noch nicht im Handelsregister eingetragenen Beherrschungs- und Gewinnabführungs-vertrag abgeschlossen (der “Beherrschungs- und Gewinnabführungs-vertrag”).
	  	 Letter of Comfort
  

1.      Gentherm Europe GmbH, registered with the commercial register at the local
court of Augsburg under HRB 25596 (“Gentherm Europe”), entered on June 16, 2011 into a not yet registered domination and profit and loss transfer agreement with W.E.T. Automotive Systems Aktiengesellschaft, registered with the
commercial register at the local court of Munich under HRB 119793 (“W.E.T. AG”) (the “Domination and Profit and Loss Transfer Agreement”).

		
	 2.      In § 2 einer Vereinbarung vom 15. Februar 2013 (abgeschlossen unter anderem zwischen
Gentherm Europe und Deutsche Balaton AG mit der Bezeichnung “Settlement Agreement” (die “Vereinbarung”)) hat sich Gentherm Europe verpflichtet, eine freiwillige zusätzliche Zahlung an diejenigen außenstehenden
Aktionäre der W.E.T. AG zu zahlen, die ihre Aktien der Gentherm Europa gemäß den Bestimmungen des Beherrschungs- und Gewinnabführungsvertrages andienen. Die Berechnung und die tatsächliche Höhe dieser zusätzlichen
freiwilligen Zahlung (die “freiwillige Zahlung”) ergeben sich aus § 2 der Vereinbarung.
	  	 2.      Pursuant to Section 2 of an agreement dated
February 15, 2013 (Gentherm Europe and Deutsche Balaton AG are among others parties of this so called Settlement Agreement (the “Agreement”)) Gentherm Europe is obliged to pay by choice an additional amount to these outside
shareholders of W.E.T. AG, which under the regulations of the Domination and Profit and Loss Transfer Agreement offer their shares to Gentherm Europe. The calculation and the final amount of this additional and optional payment (the
“Optional Payment”) are stipulated in Section 2 of the Agreement.

		
	 3.      In § 2 der Vereinbarung hat sich Gentherm, Inc. mit Sitz in Northville, Michigan, USA
(“Gentherm, Inc.”) verpflichtet auch hinsichtlich der Gesamthöhe der Freiwilligen Zahlung eine Patronatserklärung abzugeben.
	  	 3.      Under Section 2 of the Agreement Gentherm, Inc. with its seat in Northville, Michigan USA
(“Gentherm, Inc.”) is obliged to issue a new letter of comfort in regard of the Optional Payment.

 

 Die Gentherm, Inc. verpflichtet sich hiermit uneingeschränkt und unwiderruflich gegenüber
Gentherm Europe, dafür Sorge zu tragen, dass Gentherm Europe in der Weise geleitet wird und finanziell ausgestattet ist, dass Gentherm Europe zu jeder Zeit in der Lage ist, ihren Verpflichtungen aus § 2 der Vereinbarung nachzukommen.

 Gentherm, Inc. hereby undertakes vis-à-vis Gentherm Europe, thoroughly and irrevocably, to ensure
that Gentherm Europe is managed and capitalized in such manner that Gentherm Europe has, at any time, the ability to fully comply with its obligations under Section 2 of the Agreement.

 

											
		
	 Diese Patronatserklärung unterliegt dem Recht der
 Bundesrepublik Deutschland. Die deutsche Fassung ist
 maßgeblich.

 
  
  
	 	 This letter of comfort is subject to the laws of the
 Federal Republic of Germany. The German version
 shall prevail.

	 Name:
 Date:
	 		 		 	 Name:
 Date:
	 		  	

 Annex 4.1 – Declarations of Withdrawal 
 Vorab per Telefax: [Faxnummer] 
 [Landgericht München I
[Adresse] 
 / Oberlandesgericht München [Adresse]] 
 – [7 U 1805/12 / 5 HK O 14081/12 / 17 HK O 27730/11 / 16045/12] – 
 In Sachen

 Deutsche Balaton AG, Ziegelhäuser Landstraße 1, 69120 Heidelberg, vertreten durch den Vorstand, [Namen der
Vorstandsmitglieder], 
 – “[Klägerin/Antragstellerin]” – 

Prozessbevollmächtigte:        [Name Prozessbevollmächtigter] 

gegen 
 W.E.T.
Automotive Systems AG, Rudolf-Diesel-Straße 12, 85235 Odelzhausen, vertreten durch den Vorstand, Herren Caspar Baumhauer, Thomas Liedl und Frithjof Oldorff, [und den Aufsichtsrat, Herren Dr. Franz Scherer, Dr. Walter Hasselkus
und Dr. Peter Paul Moll], 
 – “[Beklagte/Antragsgegnerin]” – 

Prozessbevollmächtigte:        Rechtsanwälte P+P Pöllath + Partners, Kardinal-Faulhaber-

                         
                         Straße 10, 8033 München 
 erkläre ich namens der [Klägerin/Antragstellerin]: 
 Die
[Klägerin/Antragsstellerin] nimmt [die Klage/den Antrag] hiermit zurück. 
  
 [Name Prozessvertreter] 
 - Rechtsanwalt -EX-10.4

 Exhibit 10.4 
 Execution Copy 
 Share Purchase Agreement 

(the “SPA”) 
 Milbank, Tweed, Hadley & McCloy LLP 
 Taunusanlage 15 

60325 Frankfurt am Main, Germany 

 Share Purchase Agreement 

dated as of February 15, 2013 
 by and among 
  

	1.	Deutsche Balaton AG, a stock corporation organized under the laws of the Federal Republic of Germany, with its seat in Heidelberg and its business address at
Ziegelhäuser Landstraße 1, 69120 Heidelberg, and registered with the commercial register of the local court of Mannheim under HRB 338172 (“Balaton”) 

 

	2.	Gentherm Incorporated, a corporation organized under the laws of the State of Michigan, USA, with its seat in Northville, USA and its business address at
Northville, Michigan, 21680 Haggerty Road, Ste. 101, 48167 USA (“Gentherm Inc.”) 

  

	3.	Gentherm Europe GmbH, a limited liability company organized under the laws of the Federal Republic of Germany, with its seat in Augsburg and its business address
at Ulmer Straße 160B, 86156 Augsburg, and registered with the commercial register of the local court of Augsburg under HRB 25596 (“Purchaser”) 

- the parties under 2. and 3. collectively “Gentherm” - 

- Balaton, Gentherm Inc. and Purchaser each a “Party” and, 

collectively, the “Parties” - 

  
 2 

 Table of Contents 

 

					
	 1. Definitions
	  	 	5	  
	 2. Sale and Purchase of the Shares
	  	 	6	  
	 3. Consideration
	  	 	6	  
	 4. Representations, Warranties and Covenants of Balaton relating to the Shares
	  	 	7	  
	 5. Indemnification
	  	 	8	  
	 6. Representations / Covenants of Balaton relating to Gentherm Common Stock
	  	 	9	  
	 7. Representations, Warranties and Covenants of Gentherm Inc.
	  	 	10	  
	 8. Transfer of the Shares
	  	 	14	  
	 9. Transfer of Gentherm Common Stock and Covenant of Gentherm Inc.
	  	 	14	  
	 10. Application of Framework Agreement
	  	 	15	  

  
 3 

 List of Annexes 

 

			
	 	 
	 Annex

 
	  	 Topic

 

	 	 
	 Annex P.5

 
	  	 Executed Framework Agreement

 

	 	 
	Annex 3.2	  	 Sample Calculation

 

  
 4 

 Preamble 

 

	P.1	Whereas, Gentherm Inc. holds all shares in Purchaser. 

  

	P.2	Whereas, Purchaser holds 2,429,403 of the bearer shares with no par value (auf den Inhaber lautende Aktien ohne Nennbetrag (Stückaktien)) in
W.E.T. Automotive Systems A.G., a stock corporation organized under the laws of the Federal Republic of Germany with its seat in Odelzshausen, its business address at Rudolf-Diesel-Str. 12, 85235 Odelzhausen and registered with the commercial
register of the local court of Munich under HRB 119793 (the “Company”), and Gentherm Inc. holds 2,660 of the bearer shares with no par value (auf den Inhaber lautende Aktien ohne Nennbetrag (Stückaktien)) in the
Company. The Company has a registered share capital of EUR 9,600,000 divided into 3,200,000 bearer shares with no par value. 

  

	P.3	Whereas, Balaton holds 442,253 of the bearer shares with no par value in the Company (the “Shares”), which are booked on deposit accounts in
different banks in Germany. 

  

	P.4	Whereas, Purchaser desires to acquire, and Balaton is willing to exchange the majority of its Shares against shares in Gentherm Inc. as ultimate parent company
of the Company and the remainder of its Shares against a cash payment subject to and under the terms of this SPA and the Framework Agreement. 

  

	P.5	Whereas, the Parties and the Trustee have executed a trustee agreement dated February 12, 2013 and a framework agreement (the “Framework
Agreement”), which is attached to this SPA as Annex P.5. 

 Now, therefore, it is agreed as follows:

 1. 
 Definitions 
 “Balaton” is defined in the Recitals. 

“Balaton Documentation” is defined in the Framework Agreement. 
 “Cash Consideration” is defined in Section 3.2. 
 “Closing”
is defined in the Framework Agreement. 
 “Closing Date” is defined in the Framework Agreement. 

“Company” is defined in Section P.2. 
 “Gentherm” is defined in the Recitals. 
 “Gentherm Common Stock”
is defined in the Framework Agreement. 
 “Gentherm Inc.” is defined in the Recitals. 

  
 5 

 “Framework Agreement” is defined in Section P.5. 

“Losses” is defined in Section 5.1. 
 “NasdaqGS” means The NASDAQ Global Select Market. 
 “Parties” is defined
in the Recitals. 
 “Party” is defined in the Recitals. 
 “Publication” is defined in the Framework Agreement. 

“Purchaser” is defined in the Recitals. 
 “Registration Rights Agreement” is defined in the Framework Agreement. 

“SEC” means the U.S. Securities and Exchange Commission. 
 “Securities Act” is defined in Section 6.2(a) 

“Shares” is defined in Section P.3. 
 “Share Certificate” is defined in the Framework Agreement. 

“Stock Consideration” is defined in Section 3.3. 
 “Trustee” is defined in the Framework Agreement. 
 “Trustee
Account” is defined in the Framework Agreement. 
 2. 

Sale and Purchase of the Shares 
  

	2.1	Balaton hereby sells the Shares to Purchaser, together with all ancillary rights (Nebenrechte) pertaining thereto, including all dividend rights
(Gewinnbezugsrechte) to undistributed profits of the current business year and of prior business years. Purchaser hereby accepts such sale. 

  

	2.2	The transfer of the Shares shall take place as set further in Section 8 of this SPA. 

3. 

Consideration 
  

	3.1	The purchase price for the Shares due by Gentherm to Balaton shall be comprised of a cash payment and of the delivery of Gentherm Common Stock.

  

	3.2	The portion of the purchase price payable in cash shall be an aggregate total amount equal based on the following formula (the “Cash Consideration”):

  

	 	(1)	442,253, less 

  

	 	(2)	 (i) 3,300,000 multiplied by (ii) $13.00, then (iii) converted from U.S. Dollars to Euros at the exchange rate in effect on the date of
signing of the Framework Agreement displayed at www.eurofx.de at the date of signing 

  
 6 

	 	
of the Framework Agreement at 2:00 p.m. Frankfurt/Main time under the column “MEAN” in the line EUR/USD, then (iv) divided by €85, 

 

	 	(3)	The difference (1) minus (2) multiplied by €85 equals the Cash Consideration. 

A sample calculation of the Cash Consideration amount is attached as Annex 3.2. 

 

	3.3	The balance of the purchase price shall be payable in Gentherm Common Stock (the “Stock Consideration”) and shall be an aggregate total number of
3,300,000 fully paid and non-assessable shares of Gentherm Common Stock to be represented in the Share Certificate. 

  

	3.4	On Closing, Purchaser shall pay the Cash Consideration to the Trustee Account as set further in Section 5.2 of the Framework Agreement. 

 

	3.5	Before Closing, Gentherm Inc. shall have placed the Share Certificate, except for the restrictive legend and limitations provided in Section 6.2, free and clear of
any and all restrictive legends, liens, encumbrances, pledge rights, usufructs or other rights of third parties with the Trustee as set in Section 5.2 of the Framework Agreement. Gentherm hereby confirms that it is not required to send the
Share Certificate to Gentherm Inc. for having registered the shares represented by the Share Certificate with the US Securities and Exchange Commission. 

 4. 
 Representations, Warranties and Covenants of Balaton relating to the
Shares 
 Balaton hereby represents, warrants and undertakes for the benefit of Gentherm, by way of an independent guarantee agreement under
Section 311 paragraph 1 German Civil Code (BGB), that the following is true and correct as of Closing and, without creating any additional rights or remedies whatsoever beyond those provided for in Section 5, agrees and acknowledges
that Gentherm is entering into this SPA in reliance on such representations, warranties and undertakings: 
  

	4.1	Balaton has the right, power and authority to execute and perform the Balaton Documentation and to carry out the transactions contemplated hereby and thereby.

  

	4.2	The Balaton Documentation has been duly executed and delivered by Balaton and constitutes the valid and binding agreement of Balaton enforceable against Balaton in
accordance with its terms, subject to applicable insolvency and other similar laws affecting the enforceability of creditors’ rights generally. 

  

	4.3	 Neither the execution and performance of the Balaton Documentation nor the consummation of the transactions contemplated hereby or thereby will
conflict with, or result in, a breach or violation of any of the terms of, or constitute a default under, or require any consent not yet obtained with respect to, any other agreement or instrument by which Balaton is bound, any existing law,
regulation, 

  
 7 

	 	
judgment or order applicable to Balaton or any of Balaton’s charter documents or bylaws. 

  

	4.4	The Shares (i) are held of record and beneficially owned solely by Balaton; and (ii) are free and clear of any encumbrances, pledge rights, usufructs or other
rights of third parties. 

  

	4.5	Balaton has not entered into any agreement, nor is Balaton otherwise bound by any regulation, judgment or order, to transfer the Shares other than as to transfers
provided for in this SPA, the Framework Agreement, the Balaton Rights Agreement and/or the Trustee Agreement. 

  

	4.6	Balaton has no option or other right to acquire shares of the Company and hereby waives any such rights which Balaton may have. 

 

	4.7	There are no claims, nor are there any facts or circumstances that may give rise to a claim, disputing or challenging the title (both of record and beneficially) to any
of the Shares. 

  

	4.8	Except for the Shares, Balaton holds no shares in the Company. 

  

	4.9	Except for the Shares, no shares in the Company are attributed to Balaton pursuant to Sec. 22 German Securities Trading Act (WpHG). 

5. 

Indemnification 
  

	5.1	Balaton agrees to indemnify (Schadensersatz leisten) Gentherm as follows: 

 Balaton hereby agrees with Purchaser to indemnify Purchaser and Gentherm Inc. respectively against losses and damages (together, the “Losses”) arising from each and every breach of any of
the representations and warranties made by Balaton in Section 4 that would not have existed or arisen or been incurred had the relevant representation and warranty in Section 4 been true or complied with; provided, however, that the total
liability of Balaton under this Section 5 shall not exceed the total amount of US Dollar 42,900,000 plus the amount of the Cash Consideration. 
  

	5.2	In case of a breach of representations, warranties and covenants made by Balaton, Balaton will have thirty (30) days from receipt of written notice from Purchaser
describing such breach and the Losses therefrom in reasonable detail to cure such breach (Naturalrestitution); provided, however, that any such cure shall not relieve Balaton from the indemnification obligations of Section 5.1 that arose
as a result of the breach prior to being cured. 

  

	5.3	 The Parties are in agreement and hereby expressly confirm that the warranties, representations, agreements, undertakings and covenants made under this
Agreement represent a special agreement within the meaning of Section 311 

  
 8 

 
paragraph 1 BGB and that neither such agreement nor any other declaration made by Balaton in this SPA shall be construed to be a guarantee of the properties of a thing
(Beschaffenheitsgarantie) within the meaning of Sections 443 or 444 German Civil Code (BGB). Any other warranty claims (Gewährleistungsrechte) of any Party are hereby excluded, irrespective of their cause in law, in
particular for any material deficiencies and liability to defects or damage for or in connection with the Shares. This shall also apply to claims based on breach of pre-contractual obligations (culpa in contrahendo, section 311 German Civil
Code), violation of a positive duty of contract (positive Forderungsverletzung) and/or violation of contractual, pre-contractual or statutory duty. 
  

	5.4	Claims of Gentherm based on liability of Balaton under Section 4 shall be barred by the statute of limitations (Verjährung) three (3) years after
the Closing. 

 6. 
 Representations / Covenants of Balaton relating to Gentherm Common Stock 
 Balaton
hereby represents, warrants and agrees by way of an independent guarantee agreement under Section 311 paragraph 1 German Civil Code (BGB) for the benefit of Gentherm Inc. as follows: 

 

	6.1	Investigation by Balaton. Balaton has conducted its own independent review and analysis of the businesses, assets, condition, operations and prospects of
Gentherm and acknowledges that Balaton has had satisfactory access to the publicly filed documents of Gentherm Inc. for this purpose available at http://www.gentherm.com/page/sec-filings. In entering into this SPA, Balaton has relied solely upon its
own investigation and analysis and the representations and warranties of Gentherm in this SPA. 

  

	6.2	Investment Intent. Balaton 

  

	 	(a)	understands and agrees that the shares of Gentherm Common Stock representing the Stock Consideration have not been registered under the United States Securities Act of
1933, or under the securities laws of any other country or jurisdiction; and that the shares of Gentherm Common Stock representing the Stock Consideration shall bear the following restrictive legend: 

“The securities covered hereby have not been registered under the U.S. Securities Act of 1933, as amended (the “Securities
Act”), and may not be offered or sold within the United States or to, or for the account or benefit of, U.S. persons (i) as part of their distribution at any time or (ii) otherwise until six months after the closing date, except in
either case in accordance with Regulation S under the Securities Act or another available exemption from the registration requirements of the Securities Act (and any applicable state securities laws) or pursuant to an effective registration

  
 9 

	 	
statement. No hedging transaction can be conducted with regard to the securities except as permitted by the Securities Act. Terms used above have the meanings given to them by Regulation S “

  

	 	(b)	understands and agrees that the Stock Consideration may not be offered to be sold, sold or transferred in the absence of (i) an effective registration statement
for such securities under the Securities Act or (ii) a valid exemption from registration under the Securities Act; 

  

	 	(c)	represents and certifies that it is not a U.S. Person (and is not receiving the Stock Consideration for the account or benefit of any U.S. Person) within the meaning of
Regulation S under the Securities Act; 

  

	 	(d)	agrees that it will offer to sell or sell or otherwise transfer the Stock Consideration only in accordance with the provisions of Regulation S or Rule 144 under the
Securities Act or pursuant to any other available exemption from registration under the Securities Act or an effective registration statement under the Securities Act, and that hedging transactions involving the Stock Consideration may not be
conducted unless in compliance with the Securities Act; 

  

	 	(e)	agrees that Gentherm Inc. will refuse to register any transfer of the Stock Consideration not made in compliance with clause (d) above; and

  

	 	(f)	represents and certifies that it will acquire the Stock Consideration for its own account for the purpose of investment. 

 

	6.3	As it concerns a breach of the representations and warranties made by Balaton in this Section 6, Section 5 shall apply mutatis mutandis, whereby
Balaton’s indemnification undertaking provided for in Section 5.1 shall be agreed with Gentherm Inc. For the avoidance of doubt, the indemnification amount of US Dollar 42,900,000 plus the amount of the Cash Consideration at set forth in
Section 5 shall be the maximum amount to be paid by Balaton for any and all breaches of any representation in this SPA. 

 7. 
 Representations, Warranties and Covenants of Gentherm Inc.

 Gentherm Inc. and Purchaser hereby guarantee to Balaton by way of an independent guarantee agreement within the meaning of
Section 311 paragraph 1 German Civil Code (BGB) for the benefit of Balaton, that the following statements are true and correct as of Closing, whereby such guarantees shall only be given by Gentherm Inc. and Purchaser as far as the
respective guarantee relates to them, and agree and acknowledge that Balaton is entering into this SPA in reliance on such representations, warranties and undertakings: 
  

	7.1	 Gentherm Inc. is a corporation duly organized, validly existing and in good standing under the laws of the State of Michigan. Gentherm Inc. has all
requisite 

  
 10 

 
corporate power and authority to carry on its business as now conducted and as proposed to be conducted. Gentherm Inc. is duly qualified to transact business and is in good standing in each
jurisdiction where it is legally required to be so qualified. 
  

	7.2	Gentherm Inc. and Purchaser represent that they have full corporate power and authority to enter into the Balaton Documentation including the Trustee Agreement and have
obtained all necessary approvals of its board of directors or similar bodies in this connection. The Balaton Documentation and the Trustee Agreement have been duly and validly executed and delivered to Gentherm Inc. and Purchaser and constitutes a
legal, valid and binding obligation of Gentherm Inc. and Purchaser enforceable against Gentherm Inc. and Purchaser in accordance with its terms, except as enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or other
similar laws affecting the enforcement of creditors’ rights generally and by general equitable principles (regardless of whether such enforceability is considered in a proceeding in equity or at law). 

 

	7.3	The Balaton Documentation and the Trustee Agreement have been duly executed and delivered by Gentherm and constitutes the valid and binding agreement of Gentherm
enforceable against Gentherm in accordance with its terms, subject to applicable insolvency and other similar laws affecting the enforceability of creditors’ rights generally. 

 

	7.4	Neither the execution and performance of the Balaton Documentation including the Trustee Agreement nor the consummation of the transactions contemplated hereby or
thereby will conflict with, or result in, a breach or violation of any of the terms of, or constitute a default under, or require any consent not yet obtained with respect to, any other agreement or instrument by which Gentherm is bound, any
existing law, regulation, judgment or order applicable to Gentherm or any of Gentherm’s charter documents or bylaws. 

  

	7.5	The Gentherm Common Stock comprising the Stock Consideration, when issued, will be duly authorized and validly issued, fully paid and non-assessable, will be issued in
compliance with all applicable securities laws, will be free of preemptive or similar rights, will haves been admitted for trading on the NasdaqGS, and will be free of restrictions on transfer other than restrictions on transfer under
Section 6.2 of this SPA and under applicable securities laws. 

  

	7.6	 Gentherm Inc. does not undertake or conduct to and shall not pay any dividend, capital increase other than pursuant to the Balaton Documentation,
merger, exchange of shares of Gentherm Inc. or conduct a stock split of any Gentherm shares as long as the Share Certificate has not been delivered from Trustee to Balaton, except that this provision shall terminate in the event the transactions
contemplated by the Framework Agreement are terminated in accordance with the terms thereof. No dividend or other rights for shareholders of Gentherm Inc will 

  
 11 

 
be declared for record days between February 7, 2013 and receipt of the Share Certificate by Balaton from the Trustee, except that this provision shall terminate in the event the
transactions contemplated by the Framework Agreement are terminated in accordance with the terms thereof. Notwithstanding the foregoing, Gentherm shall be free to pay any regularly scheduled dividends to its Series C Preferred Stockholders as they
become due. 
  

	7.7	There is no action pending by Gentherm Inc. or, to Gentherm Inc.’s knowledge, by NasdaqGS to delist the Gentherm Common Stock from the NasdaqGS, nor has Gentherm
Inc. received any notification that the NasdaqGS is contemplating terminating such listing. 

  

	7.8	As of the date hereof and as of the Closing Date (immediately prior to the issuance of the Share Certificate), the authorized and outstanding capital stock of Gentherm
Inc. consists of: 

 59,991,000 shares of Gentherm Common Stock (of which 4,991,000 can only be issued as preferred
shares and the balance can only be issued as common shares), of which 29,830,292common shares and 2,332 preferred shares are issued and outstanding. All of the outstanding shares of Gentherm Common Stock have been duly authorized, are fully paid and
nonassessable and were issued in compliance with all applicable federal and state securities laws; 
 2,332 shares of preferred
stock, without par value, of which 2,332 shares are issued and outstanding and are designated as Series C 8% Convertible Preferred Stock. 
  

	7.9	Upon their issuance, the shares represented by the Share Certificate will not represent 10% or more of the Gentherm Common Stock. Immediately following the Closing and
the issuance and delivery of the Share Certificate to Balaton, and for so long as both (a) Balaton beneficially owns no more than eleven percent (11%) of the outstanding Gentherm Common Stock and (b) Balaton complies with the Balaton
Rights Agreement, Gentherm acknowledges and agrees that Balaton will not be deemed an “affiliate” of Gentherm for purposes of Rule 144 under the Securities Act. 

 

	7.10	Gentherm represents and agrees that neither it nor any of its affiliates (as defined in Regulation 501 under the Securities Act) nor any person acting on its or their
behalf has engaged or will engage in any “directed selling efforts” (as defined in Regulation S) with respect to the Gentherm Common Stock representing the Stock Consideration; 

 

	7.11	Gentherm represents that it is subject to the reporting requirements of section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, and that it shall use
its reasonable best efforts to remain subject to, and comply with, such reporting requirements for at least one (1) year from the date hereof. 

  
 12 

	7.12	Gentherm represents that neither it nor its affiliates (as defined in Rule 501 under the Securities Act) nor any person acting on its or their behalf have made any
offer or sale of securities which is integrated with the current transaction in a manner that would require registration under the Securities Act, and Gentherm agrees to take reasonable precautions designed to ensure that, for a period of six months
subsequent to the date of closing, any sale or offer to sell or solicitation of any offer to buy or otherwise negotiate in respect of any security of the same or similar class as the Gentherm Common Stock, within the United States or to U.S. Persons
(as defined in Rule 902 under the Securities Act), directly or indirectly, by Gentherm, any of its affiliates or any person acting on their behalf, will not occur under circumstances that would require the registration of the Stock Consideration
under the Securities Act. 

  

	7.13	Since January 1, 2012, Gentherm Inc. has filed with the SEC all forms, reports, schedules, statements and other documents required to be filed by it under the
Securities Exchange Act of 1934, as amended (the “Exchange Act”) (collectively, the “Gentherm SEC Documents”). As of their respective dates or, if amended, as of the date of the last such amendment, the Gentherm SEC Documents,
including, without limitation, any financial statements or schedules included therein, complied in all material respects with the applicable requirements of the Securities Act and the Exchange Act, and did not contain any untrue statement of a
material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading. Each of the balance sheets (including the
related notes) included in the Gentherm SEC Documents fairly presented in all material respects the financial position of Gentherm Inc. as of the respective dates thereof, and the other related financial statements (including the related notes)
included therein fairly presented in all material respects the results of operations and cash flows of Gentherm Inc. for the respective periods or as of the respective dates set forth therein. Each of the balance sheets and statements of operations
and cash flows (including the related notes) included in the Gentherm SEC Documents has been prepared in all material respects in accordance with generally accepted accounting principles, except as otherwise noted therein and subject, in the case of
unaudited interim financial statements, to normal year-end adjustments. 

  

	7.14	 At Balaton’s request, which may be made at any time after six months have lapsed since the date the Share Certificate was delivered to Balaton,
Gentherm will cooperate with and assist Balaton (including without limitation causing Gentherm’s transfer agent to take appropriate action) in (a) converting the Share Certificate to electronic (DWAC eligible) form and (b) removing
the Securities Act restriction from the Stock Consideration. At any time, including prior to the lapse of the six month period described above, Gentherm will cooperate and assist Balaton (including without limitation in obtaining appropriate and
necessary 

  
 13 

 
blanket legal opinions, in removing the restrictive legend on the shares being sold, and causing Gentherm’s transfer agent to take appropriate action) with respect to any sale of the Stock
Consideration made in accordance with the Registration Rights Agreement or under Rule 144. 
  

	7.15	As it concerns a breach of the representations and warranties made by Gentherm Inc. or Purchaser in this Section 7, Section 5 shall apply mutatis mutandis,
whereby Gentherm Inc.’s and Purchasers’ combined total liability shall be limited to USD 42,900,000 plus the amount of the Cash Consideration. 

 8. 
 Transfer of the Shares 

Balaton and Purchaser hereby agree that, conditional upon (aufschiebend bedingt) the passing of the Share Certificate from the Trustee to Balaton,

  

	8.1	title to the Shares, including in relation thereto (i) the co-ownership rights to the underlying global share certificates, (ii) any certificates for
interest, dividends or renewal (Zins- und Gewinnanteilsscheine, Erneuerungsscheine) and (iii) any rights to subscribe for newly issued shares in the Company (Bezugsrechte), and 

 

	8.2	Balaton’s existing membership rights relating to the Shares, and 

  

	8.3	Balaton’s claims for delivery (Herausgabe- und Auslieferungsansprüche) of its portion of the Shares vis-à-vis the Trustee,

 are hereby transferred to Purchaser in accordance with sections 398, 413 German Civil Code (BGB). 

9. 

Transfer of Gentherm Common Stock and Covenant of Gentherm Inc. 

 

	9.1	Balaton and Gentherm Inc. hereby agree that the ownership of the shares in Gentherm Common Stock representing the Stock Consideration shall transfer from Gentherm Inc.
to Balaton upon the passing of the Share Certificate from the Trustee to Balaton including any title, shareholder rights relating to the shares represented by the Share Certificate and Gentherm’s claims for delivery (Herausgabe- und
Auslieferungsansprüche) of Share Certificate vis-à-vis the Trustee. 

  

	9.2	Gentherm Inc. will register for resale by Balaton under the Securities Act all of the Gentherm Common Stock representing the Stock Consideration in accordance with the
terms of the Registration Rights Agreement and subject to reasonable cooperation from Balaton in accordance with the terms of the Registration Rights Agreement. Any costs, fees, taxes and charges for the registration of the Gentherm Common Stock
representing the Stock Consideration or accrued in connection with the registration shall be borne by Gentherm Inc. 

  
 14 

	9.3	Gentherm agrees to comply, at its own cost, with the regulations of the NasdaqGS so that Gentherm’s common stock, including the Gentherm Common Stock representing
the Stock Consideration, continues to be listed on the NasdaqGS during the effectiveness of the Form S-3 and Gentherm will not delist the Gentherm common stock from the NasdaqGS during such period. 

10. 

Application of Framework Agreement 
 Sections 6 (Confidentiality), 8 (Notices), 9 (Choice of Law, Venue), 10 (Interpretation, Formalities, Severability) and 11 (Miscellaneous) of the Framework Agreement shall apply to this SPA mutatis
mutandis. The Parties are aware that this Agreement becomes effective upon Publication as defined in the Framework Agreement. 

[remainder of page intentionally blank] 

  
 15 

 SIGNATURE PAGE – SHARE PURCHASE AGREEMENT 

IN WITNESS WHEREOF, the Parties have caused this SPA to be signed by a duly authorized signatory thereof, all as of the date first
written above. 
  

	
	 Deutsche Balaton AG
  

/s/ Jens Jüttner

 

			
	 Gentherm Europe GmbH
  

/s/ Peter Memminger, as
 representative based on
a PoA
	 	 Gentherm Incorporated
  

/s/ Peter Memminger, as
 representative based on
a PoA

 Annex P.5 – Executed Framework Agreement 

[See the executed Framework Agreement which is part of this publication.] 

 Annex 3.2 – Sample Calculation 

 

					
	 Number of W.E.T. Shares held by Balaton:
	  	 	442,253	  
		
	 Number of Shares of Gentherm Stock to be Issued to Balaton:
	  	 	3,300,000	  
	 Market Value of above shares of Gentherm Stock at $13.00 per share:
	  	$	42,900,000	  
	 Assumed exchange rate for the signing date:
	  	 	$1.30/€1.00	  
		  	  
	  
	 
	 Market Value of above shares of Gentherm Stock in Euros:
	  	€	33,000,000	  
		  	  
	  
	 
	 / €85
	  	 	/ €85                         
       	  
		  	  
	  
	 
	 Number of W.E.T. Shares Purchased for Gentherm Stock:
	  	 	388,235	  
		  	  
	  
	 
	 Number of W.E.T. Shares to be Purchased for Cash:
	  	 	54,018	  
		  	  
	  
	 
	 Number of W.E.T. Shares being purchased for Cash:
	  	 	54,018	  
	 x 85 Euro
	  	 	x €85	  
		  	  
	  
	 
		  	 	€4,591,530

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