1. Shareholder Debriefing Executive Directors presenting: Guergana Anguelova Moritz Broelz Irina Hubytska Richard Williamson

2. Agenda Review of Mission and Vision Statement Initial Strategy Evaluation of Strategy Decision Making Process Five Year Strategic Plan Questions and Discussion 2|27

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4. Mission Statement Baldwin Co. focuses on a broad-based differentiation strategy, providing products in all segments of the electronic sensor market. By creating increasingly higher levels of brand recognition and reputation, Baldwin will create a competitive advantage as the largest e-sensor producer. Baldwin Co. strives to become a market leader in the electronic sensor industry. As a result, the combination of large sales with healthy margins will ensure a long-term competitive advantage in earnings volume and the success of the firm’s strategy. Vision Statement 4|27

5. Marketing Substantial expenses to build customer loyalty and awareness Create higher demand for products High-traditional-low segment overlaps Introduction of new products in the high-end R&D 5|27

6. Production Expected low contribution margins Continuous plant automation Purchase of additional capacity Prepared for low earnings Priority: high efficiency Dividend policy Finance 6|27

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8. Unexpected Events Round 2: Erie became a Niche Player in Low-End & Traditional. Round 5: Andrews created a sellers-markets in Low-End, Traditional, Performance & Size segments by under producing. Round 7: Ferris created a sellers-markets in Low-End & Traditional segments by exiting these segments. 8|27

9. Round 2 What went wrong? Marketing Expenses reduced – loss of competitive advantage Needed Complement unadjusted – Overtime of 6.8% - loss in productivity increase of ≈ 3.9% Dividend issued Large unsold inventory in Traditional due to Erie Corrective Actions: Marketing Expenses realigned with Corporate Strategy Needed Complement adjusted Dividend policy aligned with corporate strategy 9|27

10. Market Share & Contribution Margin 10|27

11. Marketing & Product Performance BajaBzumBully 11|27

12. Financial Performance 2010-2017 Emergency Loan 12|27

13. Financing & Capex. 2010-2017 13|27

14. Capital Expenditures & Financing 14|27

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16. Product placement graphed against demand: Positioned so that demand curves overlapped Best: one high, one low and if possible one catchment Where it started: R&D 16|27

17. Marketing 17|27 Price, Sales and Advertising budgets Based on products in sector When they peaked How long they were desirable Competition Finance: Pessimistic/Weak sales forecast Production: Actual/Expected sales forecast

18. Production 18|27 Schedule determined based on Expected sales Automation levels adjusted, if possible/necessary Headcount levels adjusted, where necessary If production schedule unable to meet Expected sales Return to Marketing

19. HR/TQM 19|27 Amount budgeted based on need Assumed that all funds required would be available If not, adjusted based on consensus

20. Finance 20|27 Working capital sourced from Sales, Bonds and Shares If sufficient capital available: Plan executed If insufficient working capital available Capital requirements lowered where possible Incremental reductions in Marketing/Sales Incremental reductions in HR/TQM Product line additions held off until following year Restriction goal: Do not cause long term disruption

21. Visually 21|27

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23. Five Year Strategic Plan Overview – Business Life Cycle 23|27

24. Five Year Strategic Plan Overview – Financial Life Cycle 24|27

25. Five Year Strategic Plan Finance Levered Buyout of company Digby ($58ml) and/or Ferris ($89ml) Merger with company Erie – complements our strategy Production Maximum Automation Build capacity Marketing 100% Awareness 100% Accessibility R&D Baja 25|27

26. Five Year Strategic Plan Corporate Strategy Continue broad differentiation strategy Continue being a market share leader Continue being the most profitable company by transforming more revenues into net profit Continue increase of company value 26|27

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