MPG Metaldyne Performance Grp. Inc. (delisted)

DESCRIPTION OF CERTAIN OTHER INDEBTEDNESS

New Senior Secured Credit Facilities

        In connection with our acquisition of MPG on April 6, 2017, Holdings and AAM Inc. entered into a credit agreement (the "Credit Agreement"), among AAM Inc., as borrower, Holdings, each financial institution party thereto as a lender (the "Lenders") and administrative agent, pursuant to which Holdings and certain of its restricted subsidiaries (including certain subsidiaries of MPG acquired as part of the acquisition) are required to guarantee the borrowings of AAM Inc. thereunder and Holdings, AAM Inc. and certain of their restricted subsidiaries are required to pledge their assets (including, without limitation, after-acquired assets), subject to certain exceptions and limitations. In connection with the Credit Agreement, Holdings, AAM Inc. and certain of their restricted subsidiaries entered into a Collateral Agreement and Guarantee Agreement with the financial institutions party thereto as collateral agent and administrative agent.

        Pursuant to the Credit Agreement, the Lenders agreed to provide a $100.0 million term loan A facility (the "Term Loan A Facility"), a $1.55 billion term loan B facility (the "Term Loan B Facility") and a $900 million multi-currency revolving credit facility (the "Revolving Credit Facility," and together with the Term Loan A Facility and the Term Loan B Facility, the "New Senior Secured Credit Facilities"). The proceeds of the Term Loan A Facility and the Term Loan B Facility were used to finance a portion of the consideration for the Acquisition, pay transaction costs, redeem in full MPG Holdco I Inc.'s 7.375% Senior Notes due 2022, and repay the existing indebtedness of AAM Inc. under its Amended and Restated Credit Agreement, dated as of January 9, 2004, amended and restated as of September 13, 2013 and as further amended, among AAM Inc., as borrower, Holdings, and each financial institution party thereto as a lender and administrative agent, as well as repay existing indebtedness of MPG under its Credit Agreement, dated as of October 20, 2014 and as amended as of May 8, 2015, among MPG Holdco I Inc., as guarantor, MPG, the subsidiary guarantors party thereto, and each financial institution party thereto as a lender and administrative agent. The proceeds of the Revolving Credit Facility will be used for general corporate purposes. We paid debt issuance costs of $53.9 million in the first nine months of 2017 related to the New Senior Secured Credit Facilities.

        The Term Loan A Facility and the Revolving Credit Facility will mature on April 6, 2022, and the Term Loan B Facility will mature on April 6, 2024. Borrowings under the New Senior Secured Credit Facilities bear interest at rates based on the applicable Eurodollar rate or alternate base rate, as AAM may elect, in each case plus an applicable margin determined based on AAM's total net leverage ratio. The alternate base rate is the greatest of (a) the prime rate of a major United States financial institution, (b) the Federal Reserve Bank of New York rate plus 0.50% and (c) the adjusted Eurodollar rate plus 1.00%. The applicable margin for Eurodollar-based loans under the New Senior Secured Credit Facilities will be between 1.25% and 2.25%.

        The Credit Agreement requires certain mandatory prepayments of outstanding loans under the Term Loan A Facility and the Term Loan B Facility, subject to certain exceptions, based on 50% of the annual excess cash flow of Holdings and its restricted subsidiaries (with step-downs to 0% based upon the total net leverage ratio, and with no prepayment required if annual excess cash flow is under a specified minimum threshold), the net cash proceeds of certain asset sales and casualty and condemnation events, subject to reinvestment rights and certain other exceptions, and the net cash proceeds of any issuance of debt not otherwise permitted under the Credit Agreement.

        The Credit Agreement permits AAM Inc. to incur incremental term loan borrowings and/or increase commitments under the Revolving Credit Facility, subject to certain limitations and the satisfaction of certain conditions, in an aggregate amount not to exceed (i) $600 million, plus (ii) certain voluntary prepayments, plus (iii) additional amounts subject to pro forma compliance with a first lien net leverage ratio for Holdings and its restricted subsidiaries.

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        The Credit Agreement contains customary affirmative and negative covenants, including, among others, financial covenants based on total net leverage and cash interest expense coverage ratios and limitations on the ability of Holdings, AAM Inc. or their restricted subsidiaries to make certain investments, declare or pay dividends or distributions on capital stock, redeem or repurchase capital stock and certain debt obligations, incur liens, incur indebtedness, or merge, make certain acquisitions or certain sales of assets. The Credit Agreement includes customary events of default, the occurrence of which would permit the lenders to, among other things, declare the principal, accrued interest and other obligations to be immediately due and payable. Upon such default, the lenders may also seek customary remedies with respect to the collateral under the Collateral Agreement.

7.75% Notes

        In 2011, we issued $200.0 million of 7.75% senior unsecured notes due 2019 (7.75% Notes).

6.625% Notes

        In 2012, we issued $550.0 million of 6.625% senior unsecured notes due 2022 (6.625% Notes). Net proceeds from the 6.625% Notes were used to fund the purchase and redemption of $250.0 million of the outstanding 5.25% senior unsecured notes, including the payment of interest, the redemption of $42.5 million aggregate principal amount of our 9.25% notes, certain pension obligations and for other general corporate purposes.

6.25% Notes

        In 2013, we issued $400.0 million of 6.25% senior unsecured notes due 2021 (6.25% Notes). Net proceeds from the 6.25% Notes were used to fund the purchase and redemption of our 7.875% Notes and for other general corporate purposes. We paid debt issuance costs of $6.6 million in 2013 related to the 6.25% Notes.

Leases

        We lease certain facilities and furniture under capital leases expiring at various dates. The gross asset cost of our capital leases was $10.1 million and $8.8 million at September 30, 2017 and December 31, 2016, respectively. The net book value included in property, plant and equipment, net on the balance sheet was $5.4 million and $5.5 million at September 30, 2017 and December 31, 2016, respectively. The weighted-average interest rate on these capital lease obligations at September 30, 2017 was 6.5%.

        We also lease certain manufacturing machinery and equipment, commercial office and production facilities, vehicles and other assets under operating leases expiring at various dates. Our total expense relating to operating leases was $26.9 million, $25.3 million and $23.6 million in 2016, 2015 and 2014, respectively.

Foreign Credit Facilities

        We utilize local currency credit facilities to finance the operations of certain foreign subsidiaries. These credit facilities, some of which are guaranteed by Holdings and/or AAM Inc., expire at various dates through July 2019. At September 30, 2017, $52.3 million was outstanding under these facilities and an additional $99.9 million was available.

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DESCRIPTION OF THE EXCHANGE NOTES

         The following description is only a summary of the material provisions of the Exchange Notes and the indenture (defined below). This description does not purport to be complete, and is subject to, and is qualified in its entirety by reference to, all of the provisions of the Exchange Notes and the indenture. We urge you to read the indenture and the form of the notes, which you may obtain from us upon request. You will find the definitions of capitalized terms used in this description under the heading "—Certain Definitions." As used in this description, all references to the "Issuer," "we," "us" or "our" mean American Axle & Manufacturing, Inc., excluding, unless otherwise expressly stated or the context otherwise requires, its subsidiaries, and all references to "Holdings" mean American Axle & Manufacturing Holdings, Inc., our parent corporation, excluding, unless otherwise expressly stated or the context otherwise requires, its subsidiaries. Holdings has no material operations or assets other than its ownership of 100% of the issued and outstanding common stock of the Issuer.

General

        We will issue the 6.250% notes due 2025 (the "2025 Exchange Notes") and the 6.500% notes due 2027 (the "2027 Exchange Notes" and, together with the 2025 Exchange Notes, the "Exchange Notes") pursuant to the Indenture dated as of November 3, 2011, as amended and supplemented from time to time, among American Axle & Manufacturing, Inc., as issuer, American Axle & Manufacturing Holdings, Inc., as guarantor, the Subsidiary Guarantors (as defined herein), and U.S. Bank National Association, as trustee (the "Trustee"), as supplemented by the First Supplemental Indenture, dated March 23, 2017, among Holdings, AAM Inc., Alpha SPV I, Inc., certain subsidiary guarantors and the Trustee, and the Second Supplemental Indenture, dated May 17, 2017, among Holdings, AAM Inc., certain subsidiary guarantors and the Trustee (collectively, the "indenture"). The terms of the Exchange Notes include those stated in the indenture and those made part of the indenture by reference to the Trust Indenture Act of 1939, as amended.

Principal, Maturity and Interest

        The 2025 Exchange Notes initially will be limited to $700,000,000 aggregate principal amount and will mature on April 1, 2025. The 2025 Exchange Notes will bear interest at the rate of 6.25% per year on the principal amount thereof until April 1, 2025.

        The 2027 Exchange Notes initially will be limited to $500,000,000 aggregate principal amount and will mature on April 1, 2027. The 2027 Exchange Notes will bear interest at the rate of 6.50% per year on the principal amount thereof until April 1, 2027.

        The Exchange Notes will accrue interest from the most recent interest payment date for which interest had been paid or duly provided for on the relevant Restricted Notes. Interest will be payable on the Exchange Notes semi-annually in arrears on April 1 and October 1 of each year, to holders of record at the close of business on the March 15 or September 15 immediately preceding such interest payment date. Each payment of interest on the Exchange Notes will include interest accrued from the period commencing on and including the immediately preceding interest payment day through the day before the applicable interest payment date (or redemption date, as the case may be). Any payment required to be made on any day that is not a business day will be made on the next succeeding business day.

        Interest will cease to accrue on an Exchange Note upon its maturity or redemption. We may not reissue an Exchange Note that has matured or been redeemed or otherwise canceled, except for registration of transfer, exchange or replacement of such Exchange Note.

        The indenture provides that we have the ability to issue additional notes in series, including additional notes of the same series, having the same ranking and the same interest rate, maturity and

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other terms, as the Exchange Notes of the applicable series issued hereby. Any additional notes having the same terms as a series of Exchange Notes offered hereby and designated as the same series and class of notes will, together with such Exchange Notes offered hereby, constitute a single series of the Exchange Notes under the indenture. However, in the event that any such additional notes are not fungible with the Exchange Notes of such series issued hereby for U.S. federal income tax purposes, such non-fungible additional notes of that series will be issued with a separate CUSIP number so that they are distinguishable from the Exchange Notes of such series issued hereby. The Exchange Notes will be payable at the office of the paying agent, which initially will be an office or agency of the trustee, or an office or agency maintained by us for such purpose, in the Borough of Manhattan, The City of New York.

Guarantees

        Holdings and each of the Subsidiary Guarantors, will, jointly and severally, fully and unconditionally guarantee on a senior unsecured basis the Issuer's obligations under the Exchange Notes and the indenture. Each guarantee by a Subsidiary Guarantor will provide by its terms that it will be automatically, fully and unconditionally released and discharged upon:

(1)

any sale, exchange or transfer (by merger or otherwise) of the Capital Stock of such Subsidiary Guarantor, or the sale or disposition of all the assets of such Subsidiary Guarantor, which sale, exchange, transfer or disposition is made in compliance with the applicable provisions of the indenture;



(2)

the exercise by the Issuer of its legal defeasance option or covenant defeasance option or the discharge of the Issuer's obligations under the indenture in accordance with the terms of the indenture; or



(3)

the election of the Issuer to effect such a release following the Suspension Date as described under "—Material Covenants—Future subsidiary guarantors."

        The obligations of each Subsidiary Guarantor under its guarantee will be limited as necessary to prevent that guarantee from constituting a fraudulent conveyance or fraudulent transfer under applicable law.

Ranking

        The indebtedness evidenced by the Exchange Notes and the guarantees will be unsecured and will rank pari passu in right of payment to the senior indebtedness of the Issuer and the Guarantors, respectively.

        The Exchange Notes are unsecured obligations of the Issuer. Secured debt and other secured obligations of the Issuer (including obligations with respect to the Credit Agreement) will be effectively senior to the Exchange Notes to the extent of the value of the assets securing such debt or other obligations.

        As of September 30, 2017, there was outstanding:

•

$4,175.5 million of senior indebtedness of the Issuer, $1,624.4 million of which is secured;



•

$4.6 million of senior indebtedness of the Guarantors, all of which is secured; and



•

$75.2 million of total indebtedness of the non-guarantor Subsidiaries of the Issuer.

        Not all of our Subsidiaries will guarantee the Exchange Notes. In the event of a bankruptcy, liquidation or reorganization of any of our non-guarantor Subsidiaries, including any of our foreign Subsidiaries, holders of their indebtedness and their trade creditors will generally be entitled to payment of their claims from the assets of those entities before any assets are made available for

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distribution to us. As a result, the Exchange Notes will effectively be subordinated to the prior payment of all of the liabilities of our non-guarantor Subsidiaries.

        As of September 30, 2017, the non-guarantor Subsidiaries of AAM Inc. and MPG had total assets (net of intercompany receivables) of $3,225.7 million and total liabilities (net of intercompany notes and payables) of $909.6 million (including indebtedness of $75.2 million). For the nine months ended September 30, 2017, the non-guarantor Subsidiaries of AAM Inc. and MPG had net sales of $2,585.4 million (excluding intercompany sales) and generated net income attributable to AAM Inc. of $242.6 million. See note 15 to Holdings' condensed consolidated financial statements as of September 30, 2017, as included in our Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2017.

Optional Redemption

        On and after April 1, 2020, in the case of the 2025 Exchange Notes, and on and after April 1, 2022, in the case of the 2027 Exchange Notes, we will be entitled at our option to redeem all or a portion of the applicable series of notes upon not less than 30 nor more than 60 days' notice, at the redemption prices (expressed in percentages of principal amount on the redemption date), plus accrued and unpaid interest to the redemption date (subject to the right of holders of record on the relevant record date to receive interest due on the relevant interest payment date), if redeemed during the 12-month period commencing on April 1 of the years set forth below:

        Prior to April 1, 2020, in the case of the 2025 Exchange Notes, and prior to April 1, 2022, in the case of the 2027 Exchange Notes, we will be entitled at our option to redeem all or a portion of the applicable series of Exchange Notes at a redemption price equal to 100% of the principal amount of the applicable series of Exchange Notes plus the Applicable Premium plus accrued and unpaid interest to the redemption date (subject to the right of holders on the relevant record date to receive interest due on the relevant interest payment date). Notice of such redemption must be mailed by first-class mail to each holder's registered address or delivered electronically, not less than 30 nor more than 60 days prior to the redemption date.

        In addition, we may on any one or more occasions prior to April 1, 2020 redeem up to 35% of the original principal amount of the Exchange Notes of any series (calculated after giving effect to any issuance of additional notes for such series) with the Net Cash Proceeds of one or more Equity Offerings at a redemption price of 106.25%, in the case of the 2025 Exchange Notes, or 106.50%, in the case of the 2027 Exchange Notes, of the principal amount thereof, plus accrued and unpaid

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interest, if any, to the applicable redemption date (subject to the right of holders on the relevant record date to receive interest due on the relevant interest payment date); provided that:

(1)

at least 65% of the original principal amount of the Exchange Notes of the applicable series (calculated after giving effect to any issuance of additional notes for the applicable series) remains outstanding after each such redemption; and



(2)

the redemption occurs within 90 days after the closing of such Equity Offering.

        We will mail or deliver electronically notice of any redemption at least 30 days, but not more than 60 days, before the date of redemption to each holder of the Exchange Notes to be redeemed. If less than all the Exchange Notes are to be redeemed at any time, the trustee will select the Exchange Notes to be redeemed on a pro rata basis or by any other method the trustee deems fair and appropriate. Unless we default in payment of the redemption price, on and after the date of redemption, interest will cease to accrue on the Exchange Notes or portions thereof called for redemption.

Change of Control

        Upon the occurrence of a Change of Control, the Issuer will make an offer (a "Change of Control Offer") to each holder of Exchange Notes to repurchase all or any part of each holder's Exchange Notes at a purchase price (the "Change of Control Purchase Price") equal to 101% of the principal amount thereof, plus accrued and unpaid interest, if any, to the repurchase date. Within 30 days following any Change of Control, the Issuer will (i) cause a notice of the Change of Control Offer to be sent at least once to the Dow Jones News Service or similar business news service in the United States; and (ii) send, by first-class mail, with a copy to the trustee, a notice to each registered holder of Exchange Notes stating: (1) that a Change of Control has occurred and a Change of Control Offer is being made pursuant to the indenture and that all Exchange Notes timely tendered will be accepted for payment; (2) the Change of Control Purchase Price and the repurchase date, which shall be, subject to any contrary requirements of applicable law, a business day no earlier than 30 days nor later than 60 days from the date such notice is mailed (the "Change of Control Payment Date"); (3) the circumstances and relevant facts regarding the Change of Control (including information with respect to pro forma historical income, cash flow and capitalization after giving effect to the Change of Control) and (4) the procedures that holders of Exchange Notes must follow in order to tender their Exchange Notes (or portions thereof) for payment, and the procedures that holders of Exchange Notes must follow in order to withdraw an election to tender Exchange Notes (or portions thereof) for payment.

        The Issuer shall comply with the requirements of Rule 14e of the Securities Exchange Act of 1934, as amended (the "Exchange Act") and any other securities laws or regulations thereunder to the extent such laws and regulations are applicable in connection with the repurchase of Exchange Notes in connection with a Change of Control Offer. To the extent that the provisions of any securities laws or regulations conflict with the terms of the Exchange Notes, the Issuer will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under the indenture by virtue of such compliance.

        On the Change of Control Payment Date, the Issuer will, to the extent lawful, (1) accept for payment all Exchange Notes or portions thereof properly tendered pursuant to the Change of Control Offer; (2) deposit with the paying agent an amount equal to the Change of Control Purchase Price in respect of all Exchange Notes or portions thereof properly tendered and (3) deliver or cause to be delivered to the trustee the Exchange Notes properly accepted together with an officers' certificate stating the aggregate principal amount of Exchange Notes or portions thereof being purchased by the Issuer. The paying agent will promptly mail to each registered holder of Exchange Notes properly tendered the Change of Control Purchase Price for such Exchange Notes, and the trustee will promptly authenticate and mail (or cause to be transferred by book entry) to each holder a new note equal in

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principal amount to any unpurchased portion of the Exchange Notes surrendered by such holder, if any; provided that each such new note will be in a principal amount of $1,000 or an integral multiple thereof.

        The Issuer will publicly announce the results of the Change of Control Offer on or as soon as practicable after the Change of Control Payment Date. The Issuer will not be required to make a Change of Control Offer upon a Change of Control if a third party makes the Change of Control Offer in the manner, at the times and otherwise in compliance with the requirements set forth herein and all other provisions of the indenture and terms of the Exchange Notes applicable to a Change of Control Offer made by the Issuer and purchases all Exchange Notes validly tendered and not withdrawn under such Change of Control Offer. For the avoidance of doubt, the Merger does not constitute a Change of Control for purposes of this provision.

Material Covenants

Consolidation, merger, sale or conveyance.

        (a)   The indenture provides that neither the Issuer nor Holdings may consolidate with or merge into any other entity or convey, transfer or lease their properties and assets substantially as an entirety to any entity, unless:

•

the successor or transferee entity, if other than the Issuer or Holdings, as the case may be, is a corporation organized and existing under the laws of the United States, any state thereof or the District of Columbia and expressly assumes by a supplemental indenture executed and delivered to the trustee, in form reasonably satisfactory to the trustee, the due and punctual payment of the principal of, any premium on and any interest on all the outstanding notes and the performance of every covenant and obligation in the indenture to be performed or observed by the Issuer or Holdings, as the case may be;



•

immediately after giving effect to the transaction, no Event of Default, as defined in the indenture, and no event which, after notice or lapse of time or both, would become an Event of Default, has happened and is continuing; and



•

the Issuer or Holdings, as the case may be, has delivered to the trustee an officers' certificate and an opinion of counsel, each in the form required by the indenture and stating that such consolidation, merger, conveyance, transfer or lease and, if a supplemental indenture is required in connection with such transaction, such supplemental indenture comply with the foregoing provisions relating to such transaction.

        In case of any such consolidation, merger, conveyance or transfer, the successor entity will succeed to and be substituted for the Issuer or Holdings, as the case may be, as obligor or guarantor on the Exchange Notes, as the case may be, with the same effect as if it had been named in the indenture as the Issuer or Holdings, as the case may be.

        (b)   No Subsidiary Guarantor may consolidate with or merge into any other entity or convey, transfer or lease their properties and assets substantially as an entirety to any entity, unless:

•

the successor or transferee entity, if not a Subsidiary Guarantor prior to such merger, conveyance, transfer or lease, shall be a Person organized and existing under the laws of the jurisdiction under which such Subsidiary was organized or under the laws of the United States of America, or any state thereof or the District of Columbia, and expressly assumes, by a supplemental indenture, all the obligations of such Subsidiary under its guarantee; provided, however , that the foregoing shall not apply in the case of a Subsidiary Guarantor (x) that has been, or will be as a result of the subject transaction, disposed of in its entirety to another Person (other than to the Issuer, Holdings or an affiliate of the Issuer or Holdings), whether

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through a merger, consolidation or sale of Capital Stock or assets or (y) that, as a result of the disposition of all or a portion of its Capital Stock, ceases to be a Subsidiary;

•

immediately after giving effect to the transaction, no Event of Default, as defined in the indenture, and no event which, after notice or lapse of time or both, would become an Event of Default, has happened and is continuing; and



•

the Issuer has delivered to the trustee an officers' certificate and an opinion of counsel, each in the form required by the indenture and stating that such consolidation, merger, conveyance, transfer or lease and, if a supplemental indenture is required in connection with such transaction, such supplemental indenture comply with the foregoing provisions relating to such transaction.

Limitation on liens.

        The Issuer and Holdings will not, and will not permit any Restricted Subsidiary to, create, incur, issue, assume or guarantee any indebtedness for money borrowed ("Debt") secured by a Mortgage upon any Operating Property, or upon shares of Capital Stock or Debt issued by any Restricted Subsidiary and owned by the Issuer or Holdings or any Restricted Subsidiary, whether owned at the date of the indenture (November 3, 2011) or thereafter acquired, without effectively providing concurrently that the Exchange Notes of each series then outstanding under the indenture are secured equally and ratably with or, at our option, prior to such Debt so long as such Debt shall be so secured.

        The foregoing restriction shall not apply to, and there shall be excluded from Debt in any computation under such restriction, Debt secured by:

(1)

Mortgages on any property existing at the time of the acquisition thereof;



(2)

Mortgages on property of a corporation existing at the time such corporation is merged into

or consolidated with the Issuer or Holdings or a Restricted Subsidiary or at the time of a sale, lease or other disposition of the properties of such corporation (or a division thereof) as an entirety or substantially as an entirety to us, Holdings or a Restricted Subsidiary; provided that any such Mortgage does not extend to any property owned by us, Holdings or any Restricted Subsidiary immediately prior to such merger, consolidation, sale, lease or disposition;

(3)

Mortgages on property of a corporation existing at the time such corporation becomes a Restricted Subsidiary;



(4)

Mortgages in favor of the Issuer, Holdings or a Restricted Subsidiary;



(5)

Mortgages to secure all or part of the cost of acquisition, construction, development or improvement of the underlying property, or to secure debt incurred to provide funds for any such purpose; provided that the commitment of the creditor to extend the credit secured by any such Mortgage shall have been obtained no later than 360 days after the later of (a) the completion of the acquisition, construction, development or improvement of such property or (b) the placing in operation of such property;



(6)

Mortgages in favor of the United States of America or any state thereof, or any department, agency or instrumentality or political subdivision thereof, to secure partial, progress, advance or other payments; and



(7)

Mortgages existing on the date of the indenture or any extension, renewal, replacement or refunding of any Debt secured by a Mortgage existing on the date of the indenture or referred to in clauses (1) to (3) or (5); provided that any such extension, renewal, replacement or refunding of such Debt shall be created within 360 days of repaying the Debt secured by the Mortgage referred to in clauses (1) to (3) or (5) and the principal amount of the Debt

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secured thereby and not otherwise authorized by clauses (1) to (3) or (5) shall not exceed the principal amount of Debt, plus any premium or fee payable in connection with any such extension, renewal, replacement or refunding, so secured at the time of such extension, renewal, replacement or refunding; provided further that this clause (7) shall not include Mortgages securing Debt incurred under the Credit Agreement or any extension, renewal, replacement or refunding thereof.

        Notwithstanding the restrictions described above, the Issuer, Holdings and any Restricted Subsidiaries may create, incur, issue, assume or guarantee Debt secured by Mortgages without equally and ratably securing the Exchange Notes of each series then outstanding if, at the time of such creation, incurrence, issuance, assumption or guarantee, after giving effect thereto and to the retirement of any Debt which is concurrently being retired, the aggregate amount of all such Debt secured by Mortgages which would otherwise be subject to such restrictions (other than any Debt secured by Mortgages permitted as described in clauses (1) through (7) of the immediately preceding paragraph) plus all Attributable Debt of the Issuer, Holdings and the Restricted Subsidiaries in respect of Sale and Leaseback Transactions with respect to Operating Properties (with the exception of such transactions which are permitted under clauses (1) through (4) of the first sentence of the first paragraph under "—Limitation on sale and leaseback transactions" below) does not exceed 10% of Consolidated Net Tangible Assets.

Limitation on sale and leaseback transactions.

        The Issuer and Holdings will not, and will not permit any Restricted Subsidiary to, enter into any Sale and Leaseback Transaction with respect to any Operating Property unless:

(1)

the Sale and Leaseback Transaction is solely with the Issuer, Holdings or another Restricted Subsidiary;



(2)

the lease is for a period not in excess of 24 months, including renewals;



(3)

the Issuer, Holdings or such Restricted Subsidiary would (at the time of entering into such arrangement) be entitled as described in clauses (1) through (7) of the second paragraph under the heading "—Limitation on liens," without equally and ratably securing the notes then outstanding under the indenture, to create, incur, issue, assume or guarantee Debt secured by a Mortgage on such Operating Property in the amount of the Attributable Debt arising from such Sale and Leaseback Transaction;



(4)

the Issuer, Holdings or such Restricted Subsidiary within 360 days after the sale of such Operating Property in connection with such Sale and Leaseback Transaction is completed, applies an amount equal to the greater of (A) the net proceeds of the sale of such Operating Property or (B) the fair market value of such Operating Property to (i) the retirement of notes, other Funded Debt of the Issuer or Holdings ranking on a parity with the Exchange Notes or Funded Debt of a Restricted Subsidiary or (ii) the purchase of Operating Property; or



(5)

the Attributable Debt of the Issuer, Holdings and our Restricted Subsidiaries in respect of such Sale and Leaseback Transaction and all other Sale and Leaseback Transactions entered into after the date of the indenture (other than any such Sale and Leaseback Transaction as would be permitted as described in clauses (1) through (4) of this sentence), plus the aggregate principal amount of Debt secured by Mortgages on Operating Properties then outstanding (not including any such Debt secured by Mortgages described in clauses (1) through (7) of the second paragraph under the heading "—Limitation on liens") which do not equally and ratably secure such outstanding notes (or secure such outstanding notes on a basis

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that is prior to other Debt secured thereby), would not exceed 10% of Consolidated Net Tangible Assets.

Future subsidiary guarantors.

        The Issuer will cause each of its Subsidiaries that is not a Subsidiary Guarantor and that guarantees any Guarantee Indebtedness of the Issuer or any Guarantor to execute and deliver to the trustee a supplemental indenture pursuant to which such Subsidiary will unconditionally guarantee, on a joint and several basis, the full and prompt payment of the principal of, premium, if any, and interest in respect of the Exchange Notes on an unsecured and unsubordinated basis and all other obligations under the indenture.

        The guarantee of the Exchange Notes by any Subsidiary Guarantor will be released and discharged as described under "—Guarantees."

        The obligations of each Subsidiary Guarantor will be limited to the maximum amount as will, after giving effect to all other contingent and fixed liabilities of such Subsidiary Guarantor and after giving effect to any collections from or payments made by or on behalf of any other Guarantor in respect of the obligations of such other Guarantor under its guarantee or pursuant to its contribution obligations under the indenture, result in the obligations of such Subsidiary Guarantor under its guarantee not constituting a fraudulent conveyance or fraudulent transfer under federal or state law.

        Following the first day (the "Suspension Date"):

(1)

a series of Exchange Notes has an Investment Grade Rating from both of the Ratings Agencies; and



(2)

no Default has occurred and is continuing under the indenture with respect to such series of Exchange Notes;

Holdings, the Issuer and their Subsidiaries will not be subject to the provisions of this covenant with respect to such series of Exchange Notes.

        In addition, upon the occurrence of a Suspension Date for a series of Exchange Notes, the Issuer may elect, by delivering written notice thereof to the trustee, to suspend the guarantees of the Subsidiary Guarantors with respect to such series of Exchange Notes.

        If at any time the credit rating of a series of Exchange Notes is downgraded from an Investment Grade Rating by any Ratings Agency or if a Default or Event of Default occurs and is continuing with respect to such series of Exchange Notes, then (i) this covenant will thereafter be reinstated with respect to such series of Exchange Notes, unless and until such series of Exchange Notes subsequently attains an Investment Grade Rating and no Default or Event of Default is in existence for such series of Exchange Notes (in which event this covenant shall no longer be in effect for such time that such series of Exchange Notes maintains an Investment Grade Rating and no Default or Event of Default is in existence with respect to such series of Exchange Notes) and (ii) the guarantees of the Subsidiary Guarantors with respect to such series of Exchange Notes previously suspended will be automatically reinstated.

        There can be no assurance that the Exchange Notes will ever achieve or maintain an Investment Grade Rating.

Events of Default; Waiver and Notice

        An event of default is defined in the indenture with respect to a series of Exchange Notes as:

(a)

default for 30 days in payment of any interest on the Exchange Notes of such series when it becomes due and payable;

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(b)

default in payment of principal of or any premium on the Exchange Notes of such series at maturity or redemption or repurchase price when the same becomes due and payable;



(c)

default by the Issuer or Holdings in the performance of any other covenant contained in the indenture for the benefit of such Exchange Notes that has not been remedied by the end of a period of 60 days after notice is given as specified in the indenture;



(d)

the guarantee with respect to such Exchange Notes of (i) Holdings or (ii) any Subsidiary Guarantor that is a Significant Subsidiary or a group of Subsidiary Guarantors which collectively (as of the latest audited consolidated financial statements for Holdings) would constitute a Significant Subsidiary, in each case, ceases to be in full force and effect or is declared null and void or Holdings or any such Subsidiary Guarantor denies that it has any further liability under its guarantee to the holders of such Exchange Notes, or has given notice to such effect (other than by reason of the termination of the indenture or the release of such guarantee in accordance with the indenture), and such condition shall have continued for a period of 30 days after notice is given as specified in the indenture;



(e)

default in the payment of principal of such Exchange Notes when due or resulting in acceleration of other indebtedness of the Issuer, Holdings or any Significant Subsidiary for borrowed money where the aggregate principal amount with respect to which the default or acceleration has occurred exceeds $100 million and such acceleration has not been rescinded or annulled or such indebtedness repaid within a period of 30 days after written notice to us by the trustee or to us and the trustee by the holders of at least 25% in principal amount at maturity of such notes; provided that if any such default is cured, waived, rescinded or annulled, then the event of default by reason thereof would be deemed not to have occurred;



(f)

failure by Holdings, the Issuer or any Significant Subsidiary to pay final and nonappealable judgments aggregating in excess of $100 million (net of any amounts that are covered by insurance issued by a reputable and creditworthy insurance company), which judgments are not paid, discharged or stayed for a period of 30 days after such judgment becomes final; and



(g)

certain events of bankruptcy, insolvency and reorganization of the Issuer, Holdings or a Significant Subsidiary.

        When we refer to a "Significant Subsidiary," we mean any Subsidiary that would constitute a "significant subsidiary" within the meaning of Article 1 of Regulation S-X of the Securities Act as in effect on the date of the indenture.

        The indenture provides that, with respect to a series of Exchange Notes:

•

if an event of default described in clause (a), (b), (c), (d), (e) or (f) above has occurred and is continuing with respect to such Exchange Notes, either the trustee or the holders of not less than 25% in aggregate principal amount of such Exchange Notes may declare the principal amount of such Exchange Notes then outstanding, and any accrued and unpaid interest through the date of such declaration, to be due and payable immediately;



•

upon certain conditions such declarations may be annulled and past defaults (except for defaults in the payment of principal of, any premium on or interest on such Exchange Notes and in compliance with certain covenants) may be waived by the holders of a majority in aggregate principal amount of such Exchange Notes then outstanding; and



•

if an event of default described in clause (g) occurs and is continuing, then the principal amount of all such Exchange Notes issued under the indenture and then outstanding, together with any accrued interest through the occurrence of such event, shall become and be due and payable immediately, without any declaration or other act by the trustee or any other holder.

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Under the indenture, the trustee must give to the holders of Exchange Notes notice of all uncured defaults known to it with respect to the Exchange Notes within 90 days after such a default occurs (the term default to include the events specified above without notice or grace periods); provided that, except in the case of default in the payments of principal of, any premium on, any of the Exchange Notes, the trustee will be protected in withholding such notice if it in good faith determines that the withholding of such notice is in the interests of the holders of the Exchange Notes.

No holder may institute any action under the indenture with respect to a series of Exchange Notes unless:

•

such holder has given the trustee written notice of a continuing event of default with respect to such Exchange Notes;



•

the holders of not less than 25% in aggregate principal amount of such Exchange Notes then outstanding have requested the trustee to institute proceedings in respect of such event of default;



•

such holder or holders have offered the trustee such reasonable indemnity as the trustee may require; and



•

the trustee has failed to institute an action for 60 days thereafter; and no inconsistent direction has been given to the trustee during such 60-day period by the holders of a majority in aggregate principal amount of such Exchange Notes.

        The holders of a majority in aggregate principal amount of a series of Exchange Notes affected and then outstanding will have the right, subject to certain limitations, to direct the time, method and place of conducting any proceeding for any remedy available to the trustee or exercising any trust or power conferred on the trustee with respect to such Exchange Notes. The indenture provides that if an event of default occurs and is continuing with respect to a series of Exchange Notes, the trustee, in exercising its rights and powers under the indenture, will be required to use the degree of care of a prudent man in the conduct of his own affairs. The indenture further provides that the trustee shall not be required to expend or risk its own funds or otherwise incur any financial liability in the performance of any of its duties under the indenture unless it has reasonable grounds for believing that repayment of such funds or adequate indemnity against such risk or liability is reasonably assured to it.

        We must furnish to the trustee within 120 days after the end of each fiscal year a statement of the Issuer signed by one of the officers of the Issuer to the effect that a review of our activities during such year and our performance under the indenture and the terms of each series of notes has been made, and, to the knowledge of the signatories based on such review, we have complied with all conditions and covenants of the indenture or, if we are in default, specifying such default.

Modification of the Indenture

        The Issuer and the trustee may, without the consent of the holders of a series of Exchange Notes issued under the indenture, enter into supplemental indentures with respect to such Exchange Notes for, among others, one or more of the following purposes:

•

to evidence the succession of another corporation to the Issuer, and the assumption by such successor of our obligations under the indenture and such Exchange Notes;



•

to add covenants of the Issuer, or surrender any rights of the Issuer, or add any rights for the benefit of the holders of such Exchange Notes;

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•

to cure any ambiguity, omission, defect or inconsistency in such indenture; provided such action will not adversely affect the interests of the holders of such Exchange Notes and any related coupons in any material respect;



•

to establish the form or terms of any other series of debt securities, including any subordinated securities;



•

to evidence and provide the acceptance of any successor trustee with respect to such Exchange Notes or one or more other series of debt securities or to facilitate the administration of the trusts thereunder by one or more trustees in accordance with such indenture; and



•

to provide any additional events of default.

        With certain exceptions, the indenture, the Holdings guarantee with respect to a series of Exchange Notes or the rights of the holders of such Exchange Notes may be modified by us and the trustee with the consent of the holders of a majority in aggregate principal amount of such Exchange Notes then outstanding, but no such modification may be made without the consent of the holder of each outstanding Exchange Note of such series affected thereby that would:

•

change the maturity of any payment of principal of, or any premium on, any such Exchange Notes, or change any place of payment where, or the coin or currency in which, any such Exchange Note or any premium is payable, or impair the right to institute suit for the enforcement of any such payment on or after the maturity thereof (or, in the case of redemption, on or after the redemption date);



•

reduce the percentage in principal amount of such outstanding Exchange Notes, the consent of whose holders is required for any such modification, or the consent of whose holders is required for any waiver of compliance with certain provisions of the indenture or certain defaults thereunder and their consequences provided for in the indenture; or



•

modify any of the provisions of certain sections of the indenture, including the provisions summarized in this paragraph, except to increase any such percentage or to provide that certain other provisions of the indenture cannot be modified or waived without the consent of the holder of each outstanding Exchange Notes of such series affected thereby.

Discharge of the Indenture

        The Issuer may satisfy and discharge its obligations under a series of the Exchange Notes issued pursuant to the indenture by delivering to the trustee for cancelation all outstanding Exchange Notes of the applicable series or by depositing with the trustee or the paying agent after the Exchange Notes of such series have become due and payable, whether at stated maturity, or any redemption date, or otherwise, cash sufficient to pay all of the outstanding Exchange Notes of such series and paying all other sums payable under such series of Exchange Notes issued pursuant to the indenture by the Issuer.

Governing Law

        The indenture, the Exchange Notes and the guarantees are governed by and construed in accordance with the laws of the State of New York.

Certain Definitions

        " Applicable Premium " means, with respect to an Exchange Note of the applicable series on any date of redemption, the greater of:

(a)

1.0% of the principal amount of such Exchange Note; and

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(b)

the excess, if any, of (a) the present value as of such date of redemption of (i) the redemption price of such note on April 1, 2020 (in the case of the 2025 Exchange Notes) or April 1, 2022 (in the case of the 2027 Exchange Notes) (such redemption price being described under "—Optional Redemption"), plus (ii) all required interest payments due on such Exchange Note through April 1, 2020 (in the case of the 2025 Exchange Notes) or April 1, 2022 (in the case of the 2027 Exchange Notes) (excluding accrued but unpaid interest to the date of redemption), computed using a discount rate equal to the Treasury Rate as of such date of redemption plus 50 basis points, over (b) the then outstanding principal of such Exchange Note.

        " Attributable Debt " in respect of any Sale and Leaseback Transaction, means, as of the time of determination, the total obligation (discounted to present value at the rate per annum equal to the discount rate which would be applicable to a capital lease obligation with like term in accordance with GAAP) of the lessee for rental payments (other than amounts required to be paid on account of property taxes, maintenance, repairs, insurance, water rates and other items which do not constitute payments for property rights) during the remaining portion of the initial term of the lease included in such Sale and Leaseback Transaction.

        " Board of Directors " means the board of directors of Holdings or any committee thereof duly authorized to act on behalf of the board of directors of Holdings.

        " Capital Stock " of any Person means (i) with respect to any Person that is a corporation, any and all shares, interests, rights to purchase, warrants, options, participations or other equivalents of or interests in (however designated) equity of such Person, including any Common Stock or Preferred Stock, and (ii) with respect to any Person that is not a corporation, any and all partnership, limited liability company, membership or other equity interests of such Person, but in each case, excluding any debt securities convertible into such equity.

        " Change of Control " means:

(a)

any "person" or "group" of related persons (as such terms are used in Sections 13(d) and 14(d) of the Exchange Act) becomes the beneficial owner (as defined in Rules 13d-3 and 13d-5 under the Exchange Act, except that such person or group shall be deemed to have "beneficial ownership" of all shares that any such person or group has the right to acquire, whether such right is exercisable immediately or only after the passage of time), directly or indirectly, of 50% of the total voting power of the voting stock of Holdings or the Issuer (or their successors by merger, consolidation or purchase of all or substantially all of their assets);



(b)

during any period of two consecutive years, individuals who at the beginning of such period constituted the Board of Directors of Holdings (together with any new directors whose election to such board or whose nomination for election by the stockholders of Holdings was approved by a vote of a majority of the directors then still in office who were either directors at the beginning of such period or whose election or nomination for election was previously so approved), cease for any reason to constitute a majority of such Board of Directors then in office;



(c)

the sale, assignment, lease, transfer, conveyance or other disposition (other than by way of merger or consolidation), in one or a series of related transactions, of all or substantially all of the assets of Holdings and its Subsidiaries, taken as a whole, or of the Issuer and its Subsidiaries, taken as a whole, to any "person" (as such term is used in Sections 13(d) and 14(d) of the Exchange Act);



(d)

the adoption by the stockholders of Holdings or the Issuer of a plan or proposal for the liquidation or dissolution of Holdings or the Issuer; or

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(e)

Holdings ceases to own, directly or indirectly, all of the Capital Stock of the Issuer (other than in connection with a merger of Holdings into the Issuer permitted by the indenture).

        " Common Stock " means, with respect to any Person, any and all shares, interest or other participations in, and other equivalents (however designated and whether voting or nonvoting) of, such Person's common stock whether or not outstanding on the Issue Date, and includes, without limitation, all series and classes of such common stock.

        " Consolidated Current Liabilities " means the aggregate of the current liabilities of Holdings appearing on the most recent available consolidated balance sheet of Holdings, all in accordance with GAAP. In no event shall Consolidated Current Liabilities include any obligation of Holdings or its Subsidiaries issued under a revolving credit or similar agreement if the obligation issued under such agreement matures by its terms within 12 months from the date thereof but by the terms of such agreement such obligation may be renewed or extended or the amount thereof reborrowed or refunded at the option of Holdings, the Issuer or any Subsidiary for a term in excess of 12 months from the date of determination.

        " Consolidated Net Tangible Assets " means Consolidated Tangible Assets after deduction of Consolidated Current Liabilities.

        " Consolidated Tangible Assets " means the aggregate of all assets of Holdings (including the value of all existing Sale and Leaseback Transactions and any assets resulting from the capitalization of other long-term lease obligations in accordance with GAAP) appearing on the most recent available consolidated balance sheet of Holdings at their net book values, after deducting related depreciation, applicable allowances and other properly deductible items, and after deducting all goodwill, trademarks, tradenames, patents, unamortized debt discount and expenses and other like intangibles, all prepared in accordance with GAAP.

        " Credit Agreement " means the Credit Agreement dated as of April 6, 2017 among Holdings, AAM Inc., each financial institution party thereto as a lender and JPMorgan Chase Bank, N.A., as Administrative Agent.

        " Credit Facilities " means, collectively, a $100 million term loan A facility, a $1.55 billion term loan B facility and a $900 million multi-currency revolving credit facility provided pursuant to the Credit Agreement.

        " Default " means any event or condition that is, or after notice or passage of time or both would be, an Event of Default.

        " Equity Offering " means a public offering for cash by the Issuer or Holdings of its Common Stock, or options, warrants or rights with respect to its Common Stock, other than (x) public offerings with respect to the Issuer's or Holding's Common Stock, or options, warrants or rights, registered on Form S-4 or S-8, (y) an issuance to any Subsidiary of Holdings or (z) any offering of Common Stock issued in connection with a transaction that constitutes a Change of Control.

        " Funded Debt " means all Debt having a maturity of more than 12 months from the date as of which the determination is made or having a maturity of 12 months or less but by its terms being renewable or extendable beyond 12 months from such date at the option of the borrower, but excluding any such Debt owed to the Issuer, Holdings or a Subsidiary.

        " GAAP " means generally accepted accounting principles set forth in the opinions and pronouncements of the Accounting Principles Board of the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or in such other statements by such other entity as have been approved by a significant segment of the accounting profession which are in effect on the Issue Date.

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        " Guarantee Indebtedness " means, with respect to any Person on any date of determination (without duplication):

(1)

the principal of and premium (if any) in respect of indebtedness of such Person for borrowed money;



(2)

the principal of and premium (if any) in respect of obligations of such Person evidenced by bonds, debentures, notes or other similar instruments;



(3)

the principal component of all obligations of such Person in respect of letters of credit, bankers' acceptances or other similar instruments (including reimbursement obligations with respect thereto, except to the extent such reimbursement obligation relates to a trade payable or similar obligation to a trade creditor in each case incurred in the ordinary course of business and such obligation is satisfied within 30 days of incurrence) other than obligations with respect to letters of credit securing obligations (other than obligations described in clauses (1) and (2) above) entered into in the ordinary course of business of such Person to the extent such letters of credit are not drawn upon or, to the extent drawn upon, such drawing is reimbursed no later than the fifth business day following receipt by such Person of a demand for reimbursement following payment on the letter of credit;



(4)

the principal component or liquidation preference of all obligations of any Subsidiary that is not a Subsidiary Guarantor with respect to the redemption, repayment or other repurchase of any Preferred Stock (but excluding, in each case, any accrued dividends);



(5)

the principal component of all Guarantee Indebtedness of other Persons secured by a lien on any asset of such Person, whether or not such Guarantee Indebtedness is assumed by such Person; provided, however , that the amount of such Guarantee Indebtedness will be the lesser of (a) the fair market value of such asset at such date of determination and (b) the amount of such Guarantee Indebtedness of such other Persons; and



(6)

the principal component of Guarantee Indebtedness of other Persons to the extent guaranteed by such Person (whether or not such items would appear on the balance sheet of the guarantor or obligor).

        " Guarantors " means Holdings, MPG and each of AAM Inc.'s and MPG's subsidiaries that are guarantors under the Credit Facilities, including the Subsidiary Guarantors.

        " Investment Grade Rating " means a rating equal to or higher than Baa3 (or the equivalent) by

        Moody's Investors Service, Inc. and BBB- (or the equivalent) by Standard & Poor's Ratings Group, Inc., in each case, with a stable or better outlook; provided that a change in outlook shall not by itself constitute a loss of an Investment Grade Rating.

        " Issue Date " means the original issue date of the Restricted Notes under the indenture.

        " Mortgage " means, with respect to any property or assets, any mortgage or deed of trust, pledge, hypothecation, assignment, security interest, lien, encumbrance or any other security arrangement of any kind or nature whatsoever on or with respect to such property or assets (including any conditional sale or other title retention agreement having substantially the same economic effect as any of the foregoing).

        " Net Cash Proceeds " means, with respect to any issuance or sale of Capital Stock of the Company, the cash proceeds of such issuance or sale net of attorneys' fees, accountants' fees, initial purchasers' or placement agents' fees, listing fees, discounts or commissions and brokerage, consultant and other fees and charges actually incurred in connection with such issuance or sale and net of taxes paid or payable as a result of such issuance or sale (after taking into account any available tax credit or deductions and any tax sharing arrangements).

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        " Operating Property " means any real property or equipment located in the United States owned by, or leased to, the Issuer, Holdings or any Subsidiary that has a market value in excess of 1.0% of Consolidated Net Tangible Assets.

        " Person " means any individual, corporation, partnership, joint venture, trust, unincorporated organization or government or any agency or political subdivision thereof.

        " Preferred Stock " means, as applied to the Capital Stock of any corporation, Capital Stock of any class or classes (however designated) that is preferred as to the payment of dividends, or as to the distribution of assets upon any voluntary or involuntary liquidation or dissolution of such Person, over shares of Capital Stock of any other class of such Person.

        " Ratings Agencies " means Standard & Poor's Ratings Group, Inc. and Moody's Investors Service Inc. or if Standard & Poor's Ratings Group, Inc. or Moody's Investors Service Inc. or both shall not make a rating on the Exchange Notes publicly available, a nationally recognized statistical Ratings Agency or agencies, as the case may be, selected by Holdings (as certified by a resolution of the Board of Directors) which shall be substituted for Standard & Poor's Ratings Group, Inc. or Moody's Investors Service Inc. or both, as the case may be.

        " Restricted Subsidiary " means any Subsidiary (excluding the Issuer) that owns Operating Property.

        " Sale and Leaseback Transaction " means any arrangement with any Person providing for the leasing to the Issuer, Holdings or any Subsidiary of any Operating Property, which Operating Property has been or is to be sold or transferred by the Issuer, Holdings or such Subsidiary to such Person.

        " Subsidiary " means any corporation of which at least a majority of the outstanding stock having by the terms thereof ordinary voting power for the election of directors of such corporation (irrespective of whether or not at the time stock of any other class or classes of such corporation shall have or might have voting power by reason of the happening of any contingency) is at the time directly or indirectly owned by the Issuer or Holdings, or by one or more other Subsidiaries, or by the Issuer or Holdings and one or more other Subsidiaries.

        " Subsidiary Guarantor " means certain of AAM Inc.'s and MPG's current and future subsidiaries that are guarantors under the Credit Facilities (and any other Subsidiary that provides a guarantee of the Exchange Notes in accordance with the indenture); provided that upon release or discharge of such Subsidiary from its guarantee in accordance with the indenture, such Subsidiary ceases to be a Subsidiary Guarantor.

        " Treasury Rate " means the yield to maturity at the time of computation of United States Treasury securities with a constant maturity (as compiled and published in the most recent Federal Reserve Statistical Release H.15 (519) ("Statistical Release") that has become publicly available at least two business days prior to the redemption date (or, if such Statistical Release is no longer published, any publicly available source or similar market data)) most nearly equal to the period from the redemption date to April 1, 2020, in the case of the 2025 Exchange Notes, and April 1, 2022, in the case of the 2027 Exchange Notes; provided , however , that if the period from the redemption date to April 1, 2020, in the case of the 2025 Exchange Notes, or April 1, 2022, in the case of the 2027 Exchange Notes, is not equal to the constant maturity of a United States Treasury security for which a weekly average yield is given, the Treasury Rate shall be obtained by linear interpolation (calculated to the nearest one-twelfth of a year) from the weekly average yields of United States Treasury securities for which such yields are given, except that if the period from the redemption date to April 1, 2020, in the case of the 2025 Exchange Notes, or April 1, 2022, in the case of the 2027 Exchange Notes, is less than one year, the weekly average yield on actually traded United States Treasury securities adjusted to a constant maturity of one year will be used.

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BOOK-ENTRY; DELIVERY AND FORM

        Upon closing of the exchange offers, each series of the Exchange Notes will be represented by one or more fully registered global securities. Each such global security will be deposited with or on behalf of, DTC and registered in the name of DTC or a nominee thereof. Unless and until it is exchanged in whole or in part for Exchange Notes in definitive form, no global security may be transferred except as a whole by DTC to a nominee of DTC or by a nominee of DTC to DTC or another nominee of DTC or by DTC or any such nominee to a successor of DTC or a nominee of such successor. Accountholders in the Euroclear Bank S.A./N.V. or Clearstream Banking, société anonyme clearance systems may hold beneficial interests in the Exchange Notes through the accounts that each of these systems maintain as participants in DTC.

        So long as DTC or its nominee is the registered owner of the global securities, DTC or its nominee, as the case may be, will be the sole holder of the Exchange Notes represented thereby for all purposes under the indenture governing the Exchange Notes. Except as otherwise provided in this section, the beneficial owners of the global securities representing the Exchange Notes will not be entitled to receive physical delivery of certificated Exchange Notes and will not be considered the holders thereof for any purpose under the indenture, and the global securities representing the Exchange Notes shall not be exchangeable or transferable. Accordingly, each person owning a beneficial interest in a global security must rely on the procedures of DTC and, if such person is not a participant, on the procedures of the participant through which such person owns its interest, in order to exercise any rights of a holder under the indenture. The laws of some jurisdictions require that certain purchasers of securities take physical delivery of such securities in certificated form. Such limits and such laws may impair the ability to transfer beneficial interests in the global securities representing the Exchange Notes.

        The global securities representing the Exchange Notes are exchangeable for certificated Exchange Notes of like tenor and terms and of differing authorized denominations aggregating a like amount only if:

•

DTC notifies us that it is unwilling, unable or ineligible to continue as depositary for the global securities and a successor depositary is not appointed by us within 90 days of such notification or of our becoming aware of DTC's ineligibility;



•

there shall have occurred and be continuing an Event of Default under the indenture governing the Exchange Notes with respect to any of the global securities and the outstanding Exchange Notes of the series represented by such global securities shall have become due and payable pursuant to the relevant indenture and the trustee has requested that certificated Exchange Notes be issued; or



•

we have decided to discontinue use of book-entry transfers through DTC. DTC has advised us that, under its current practices, it would notify its participants of our request, but would only withdraw beneficial interests from the global securities at the request of its participants.

        Upon any such exchange, the certificated Exchange Notes shall be registered in the names of the beneficial owners of the global securities representing the Exchange Notes of the applicable series as provided by DTC's relevant participants (as identified by DTC).

        The description of the operations and procedures of DTC set forth below are provided solely as a matter of convenience. These operations and procedures are solely within the control of the respective settlement systems and are subject to change by them from time to time. We do not take any responsibility for these operations or procedures, and investors are urged to contact the relevant system or its participants directly to discuss these matters.

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        The following is based on information furnished by DTC:

•

DTC is a limited-purpose trust company organized under the laws of the State of New York, a "banking organization" within the meaning of the New York Banking Law, a member of the Federal Reserve System, a "clearing corporation" within the meaning of the New York Uniform Commercial Code, and a "clearing agency" registered pursuant to the provisions of Section 17A of the Exchange Act. DTC holds securities that its participants deposit with DTC. DTC also facilitates the settlement among participants of securities transactions, such as transfers and pledges, in deposited securities through electronic computerized book entry changes in participants' accounts, thereby eliminating the need for physical movement of securities certificates. Direct participants include securities brokers and dealers, banks, trust companies, clearing corporations and certain other organizations. Access to DTC's system is available to securities brokers and dealers, banks and trust companies that clear through or maintain a custodial relationship with a direct participant, either directly or indirectly.



•

Persons who are not participants may beneficially own the Exchange Notes held by DTC only through direct participants or indirect participants. Purchases of the Exchange Notes under DTC's system must be made by or through direct participants, which will receive a credit for such Exchange Notes on DTC's records. The ownership interest of each actual purchaser of each note represented by a global security (a "Beneficial Owner") is in turn to be recorded on the direct participants' and indirect participants' records. Beneficial Owners will not receive written confirmation from DTC of their purchase, but Beneficial Owners are expected to receive written confirmations providing details of the transaction, as well as periodic statements of their holdings, from the direct participants or indirect participants through which such Beneficial Owner entered into the transaction. Transfers of ownership interests in the global securities representing the Exchange Notes are to be accomplished by entries made on the books of participants acting on behalf of Beneficial Owners. Beneficial Owners of the global securities representing the Exchange Notes will not receive certificated Exchange Notes representing their ownership interests therein, except in the event that use of the book-entry system for such Exchange Notes is discontinued and in certain other limited circumstances.



•

Principal, premium, if any, and interest payments on the global securities representing the Exchange Notes will be made to DTC. DTC's practice is to credit direct participants' accounts on the applicable payment date in accordance with their respective holdings shown on DTC's records unless DTC has reason to believe that it will not receive payment on such date. Payments by participants to Beneficial Owners will be governed by standing instructions and customary practices, as is the case with securities held for the accounts of customers in bearer form or registered in "street name," and will be the responsibility of such participant and not of DTC, the trustee or ours, subject to any statutory or regulatory requirements as may be in effect from time to time. Payment of principal, premium, if any, and interest to DTC is our and the trustee's responsibility, disbursement of such payments to direct participants is the responsibility of DTC, and disbursement of such payments to the Beneficial Owners is the responsibility of direct participants and indirect participants.



•

DTC may discontinue providing its services as securities depository with respect to the Exchange Notes at any time by giving reasonable notice to us or the trustee. Under such circumstances, in the event that a successor securities depository is not obtained, certificated Exchange Notes are required to be printed and delivered.

        The information in this section concerning DTC and DTC's system has been obtained from sources that we believe to be reliable, but we take no responsibility for the accuracy thereof. Transfers between participants in DTC will be effected in accordance with DTC's procedures and will be settled in same-day funds.

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