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TABLE OF CONTENTS
TABLE OF CONTENTS
Table of Contents
Filed Pursuant to Rule 424(b)(3)
Registration No. 333- 217033
The information in this preliminary prospectus supplement and the accompanying prospectus is not complete and may be changed. This preliminary prospectus
supplement and the accompanying prospectus are not an offer to sell the securities nor do they seek an offer to buy these securities in any jurisdiction where the offer or sale is not permitted.
Subject to completion, dated November 7, 2017.
Preliminary Prospectus Supplement
(To Prospectus dated March 30, 2017)
15,000,000 Shares
American Axle & Manufacturing Holdings, Inc.
Common Stock
This prospectus relates to the proposed sale of up to 15,000,000 shares of common stock of American Axle & Manufacturing
Holdings, Inc. by the selling stockholder named in this prospectus supplement. We are not offering any shares of common stock under this prospectus supplement and will not receive any proceeds
from the sale of shares offered by the selling stockholder. The selling stockholder acquired the shares in
connection with our acquisition of Metaldyne Performance Group Inc. We are registering the offer and sale of the shares to satisfy registration rights we have granted to the selling
stockholder.
The
underwriter has agreed to purchase the shares of common stock from the selling stockholder at a price of $ , which will result in
$ of aggregate proceeds
to the selling stockholder before expenses. The underwriter may offer and sell or otherwise dispose of the shares of common stock described in this prospectus from time to time through public or
private transactions at prevailing market prices, at prices related to prevailing market prices or at privately negotiated prices. The selling stockholder will bear all underwriting fees, commissions
and discounts, if any, attributable to the sales of shares and any transfer taxes. We will bear all other costs, expenses and fees in connection with the registration of the shares. See "Underwriting"
for more information about how the underwriter may sell or dispose of its shares of common stock.
Our
common stock is listed on the New York Stock Exchange, or NYSE, under the symbol "AXL". On November 6, 2017, the closing sales price of our common stock as
reported on the NYSE was $18.36 per share.
Investing in our common stock involves risk. See "Risk Factors" beginning on page S-3 of this prospectus supplement and in our other
filings with the Securities and Exchange Commission incorporated by reference in this prospectus supplement or the accompanying prospectus to read about factors you should consider before buying
shares of our common stock.
Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these
securities or passed upon the accuracy or adequacy of this prospectus supplement or the accompanying prospectus. Any representation to the contrary is a criminal offense.
Delivery of the shares of common stock will be made on or about November , 2017.
Deutsche Bank Securities
Prospectus supplement dated November , 2017.
Table of Contents
TABLE OF CONTENTS
Prospectus Supplement
Prospectus
Table of Contents
Neither we, the selling stockholder nor the underwriter has authorized anyone to provide you with information different from that
contained in or incorporated by reference in this prospectus supplement, the accompanying prospectus or any free writing prospectus prepared by us or on our behalf. Neither we, the selling stockholder
nor the underwriter takes any responsibility for, or can provide any assurance as to the reliability of, any information other than the information contained or incorporated by reference in this
prospectus supplement, the accompanying prospectus or any free writing prospectus prepared by us or on our behalf. We, the selling stockholder and the underwriter are offering to sell, and seeking
offers to buy, shares of our common stock only in jurisdictions where offers and sales are permitted.
You should assume that the information appearing or incorporated by reference in this prospectus supplement, the accompanying prospectus or any free writing
prospectus prepared by us is accurate only as of their respective dates or on the date or dates which are specified in such documents, and that any information in documents that we have incorporated
by reference is accurate only as of the date of such document incorporated by reference. Our business, financial condition, liquidity, results of operations and prospects may have changed since those
dates.
This
document is in two parts. The first part is this prospectus supplement, which describes the terms of this offering of common stock and also adds to and updates information contained
in the accompanying prospectus and the documents incorporated by reference into this prospectus supplement and the accompanying prospectus. The second part, the accompanying prospectus dated
March 30, 2017, including the documents incorporated by reference therein, provides more general information.
Generally, when we refer to this prospectus, we are referring to both parts of this document combined. To the extent there is a conflict between the information contained in this prospectus
supplement, on the one hand, and the information contained in the accompanying prospectus or in any document incorporated by reference that was filed with the Securities and Exchange Commission, or
SEC, before the date of this prospectus supplement, on the other hand, you should rely on the information in this prospectus supplement. If any statement in one of these documents is inconsistent with
a statement in another document having a later date (for example, a document incorporated by reference in this prospectus supplement) the statement in the document having the later date modifies or
supersedes the earlier statement.
Unless
stated otherwise, references in this prospectus supplement and the accompanying prospectus to "AAM," "the Company", "we," "us," or "our" refer to American Axle &
Manufacturing Holdings, Inc. a Delaware corporation, ("Holdings") and its subsidiaries and predecessors, collectively.
We
refer to Metaldyne Performance Group Inc. as "MPG".
We
refer to American Securities LLC and its affiliates, collectively as "American Securities" or the "selling stockholder".
Table of Contents
SUMMARY
This summary highlights selected information contained or incorporated by reference in this prospectus supplement or the
accompanying prospectus. It does not contain all of the information that you should consider before investing in shares of our common stock. You should carefully read this entire prospectus supplement
and the accompanying prospectus, including the factors described or referred to under the heading "Risk Factors" herein and in our annual report on Form 10-K for the year ended
December 31, 2016 (the "2016 Form 10-K") and the financial statements and related notes and other information incorporated by reference in this prospectus supplement and the accompanying
prospectus, before making an investment decision.
Our Company
We are a global Tier I supplier to the automotive, commercial and industrial markets. We design, engineer, validate and manufacture
driveline, metal forming, powertrain and casting products, employing over 25,000 associates, operating at more than 90 facilities in 17 countries, to support our customers on global and regional
platforms with a continued focus on delivering operational excellence, technology leadership and quality. For a description of our business, financial condition, results of operations and other
important information regarding us, we refer you to our filings with the SEC incorporated by reference in this prospectus supplement and the accompanying prospectus. For instructions on how to find
copies of these documents, see "Where You Can Find More Information."
Holdings
was incorporated in Delaware on May 15, 1998. Holdings' principal executive offices are located at One Dauch Drive, Detroit, Michigan 48211, and its telephone number at
that address is 313-758-2000. Holdings' website is www.aam.com. The information contained on or accessible through our website neither constitutes part of this prospectus supplement nor is
incorporated by reference herein.
S-1
Table of Contents
The Offering
The following summary of the offering contains basic information about the offering and our common stock and is not
intended to be complete. It does not contain all the information that may be important to you. For a more complete understanding of our common stock, please refer to the section of the accompanying
prospectus entitled "Description of Common Stock."
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Common stock offered by the selling stockholder
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15,000,000 shares.
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Common stock outstanding
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111,290,072 shares as of November 6, 2017.
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Use of proceeds
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We will not receive any of the proceeds from the sale of shares of common stock by the selling stockholder.
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Dividend policy
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We have not declared or paid any dividends in 2017, 2016, or 2015 and we do not have a current plan to pay dividends on our
common stock. Any decision to declare and pay dividends in the future will be made at the sole discretion of our board of directors.
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Risk factors
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See "Risk Factors" for a discussion of risks you should carefully consider before deciding to invest in our common
stock.
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Listing
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Our common stock is listed on the NYSE under the symbol "AXL".
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S-2
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RISK FACTORS
Investing in our common stock involves risks. You should carefully consider the risks and uncertainties described below
as well as those contained in our 2016 Form 10-K, including our consolidated financial statements and the related notes, which are incorporated by reference into this prospectus supplement and
the accompanying prospectus. These risks could materially affect our business, results of operations or financial condition and cause the value of our common stock to decline. You could lose all or
part of your investment.
Risks Related to this Offering and Ownership of Our Common Stock
Our stock price may fluctuate significantly following the offering, and you may not be able to resell shares
of our common stock at or above the price you paid or at all, and you could lose all or part of your investment as a result.
The trading price of our common stock may experience volatility following this offering. Market volatility often has been unrelated or
disproportionate to the operating performance of particular companies. You may not be able to resell your shares at or above the public offering price due to a number of factors such
as:
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the factors described below under the heading "Forward-Looking Statements," and
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the risk factors described in our 2016 Form 10-K.
Future sales, or the perception of future sales, by us or our existing stockholders in the public market
could cause the market price for our common stock to decline.
The sale of substantial amounts of shares of our common stock in the public market, or the perception that such sales could occur, could harm
the prevailing market price of shares of our common stock. These sales, or the possibility that these sales may occur, also might make it more difficult for us to sell equity securities in the future
at a time and at a price that we deem appropriate.
S-3
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FORWARD-LOOKING STATEMENTS
Certain statements contained in this prospectus supplement and the documents incorporated herein or therein by reference are forward-looking in
nature, such as statements concerning our expectations, beliefs, plans, objectives, goals, strategies, and future events or performance. Such statements are "forward-looking" statements within the
meaning of the Private Securities Litigation Reform Act of 1995 and relate to trends and events that may affect our future financial position and operating results. The terms such as "will," "may,"
"could," "would," "plan," "believe," "expect," "anticipate," "intend," "project," "target," and similar words or expressions, as well as statements in future tense, are intended to identify
forward-looking statements.
Forward-looking
statements should not be read as a guarantee of future performance or results, and will not necessarily be accurate indications of the times at, or by, which such
performance or results will be achieved. Forward-looking statements are based on information available at the time those statements are made and/or management's good faith belief as of that time with
respect to future events and are subject to risks and may differ materially from those expressed in or suggested by the forward-looking statements. Important factors that could cause such differences
include, but are not limited to:
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reduced purchases of our products by General Motors Company (GM), FCA US LLC (FCA), or other customers;
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reduced demand for our customers' products (particularly light trucks and sport utility vehicles (SUVs) produced by GM and FCA);
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our ability to develop and produce new products that reflect market demand;
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lower-than-anticipated market acceptance of new or existing products;
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our ability to respond to changes in technology, increased competition or pricing pressures;
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our ability to attract new customers and programs for new products;
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our ability to successfully integrate the business and information systems of Metaldyne Performance Group, Inc. (MPG) and to realize the
anticipated benefits of the merger;
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risks inherent in our global operations (including adverse changes in trade agreements, tariffs, immigration policies, political stability,
taxes and other law changes, potential disruptions of production and supply, and currency rate fluctuations);
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negative or unexpected tax consequences;
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risks related to disruptions to ongoing business operations as a result of the merger with MPG, including disruptions to management time;
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liabilities arising from warranty claims, product recall or field actions, product liability and legal proceedings to which we are or may
become a party, or the impact of product recall or field actions on our customers;
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our ability to achieve the level of cost reductions required to sustain global cost competitiveness;
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supply shortages or price increases in raw materials, utilities or other operating supplies for us or our customers as a result of natural
disasters or otherwise;
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our ability or our customers' and suppliers' ability to successfully launch new product programs on a timely basis;
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our ability to realize the expected revenues from our new and incremental business backlog;
S-4
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risks related to a failure of our information technology systems and networks, and risks associated with current and emerging technology
threats and damage from computer viruses, unauthorized access, cyber attack and other similar disruptions;
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global economic conditions;
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a significant disruption in operations at one or more of our key manufacturing facilities;
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our ability to maintain satisfactory labor relations and avoid work stoppages;
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our suppliers', our customers' and their suppliers' ability to maintain satisfactory labor relations and avoid work stoppages;
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price volatility in, or reduced availability of, fuel;
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potential liabilities or litigation relating to, or assumed in, the MPG merger;
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potential adverse reactions or changes to business relationships resulting from the completion of the merger with MPG;
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our ability to protect our intellectual property and successfully defend against assertions made against us;
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our ability to attract and retain key associates;
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availability of financing for working capital, capital expenditures, research and development (R&D) or other general corporate purposes
including acquisitions, as well as our ability to comply with financial covenants;
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our customers' and suppliers' availability of financing for working capital, capital expenditures, R&D or other general corporate purposes;
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changes in liabilities arising from pension and other postretirement benefit obligations;
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risks of noncompliance with environmental laws and regulations or risks of environmental issues that could result in unforeseen costs at our
facilities or reputational damage;
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adverse changes in laws, government regulations or market conditions affecting our products or our customers' products (such as the Corporate
Average Fuel Economy (CAFE) regulations);
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our ability or our customers' and suppliers' ability to comply with the Dodd-Frank Act and other regulatory requirements and the potential
costs of such compliance; and
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other unanticipated events and conditions that may hinder our ability to compete.
It
is not possible to foresee or identify all such factors and we make no commitment to update any forward-looking statement or to disclose any facts, events or circumstances after the
date hereof that may affect the accuracy of any forward-looking statement.
S-5
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USE OF PROCEEDS
We will not receive any proceeds from the sale of shares of our common stock by the selling stockholder.
S-6
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PRICE RANGE OF COMMON STOCK; DIVIDENDS
Our common stock began trading publicly on the NYSE under the symbol "AXL". The following table sets forth the high and low sale
prices per share for our common stock as reported on the NYSE for the period indicated:
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Stock Price
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High
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Low
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Fiscal Year Ended December 31, 2015:
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First Quarter ended March 31, 2015
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$
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25.86
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$
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22.20
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Second Quarter ended June 30, 2015
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$
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26.04
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$
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20.91
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Third Quarter ended September 30, 2015
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$
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21.45
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$
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19.06
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Fourth Quarter ended December 31, 2015
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$
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22.76
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$
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18.64
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Fiscal Year Ended December 31, 2016:
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First Quarter ended March 31, 2016
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$
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18.52
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$
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11.75
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Second Quarter ended June 30, 2016
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$
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16.97
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$
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13.76
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Third Quarter ended September 30, 2016
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$
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18.00
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$
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14.32
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Fourth Quarter ended December 31, 2016
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$
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19.51
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$
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13.45
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Fiscal Year Ending December 31, 2017:
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First Quarter ending March 31, 2017
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$
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21.20
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$
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18.54
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Second Quarter ending June 30, 2017
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$
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17.92
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$
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14.30
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Third Quarter ending September 30, 2017
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$
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18.21
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$
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13.59
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Fourth Quarter (through November 6, 2017)
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$
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18.94
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$
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17.56
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The
closing sale price of our common stock, as reported by the NYSE, on November 6, 2017 was $18.36.
We
have not declared or paid any dividends in 2017, 2016, or 2015 and we do not have a current plan to pay dividends on our common stock. Any decision to declare and pay dividends in the
future will be made at the sole discretion of our board of directors.
S-7
Table of Contents
SELLING STOCKHOLDER
This prospectus relates to the sale of up to a total of 15,000,000 shares of common stock by the selling stockholder. On April 6, 2017,
in connection with our acquisition of Metaldyne Performance Group Inc., we entered into a stockholders' agreement with the selling stockholder pursuant to which we agreed to prepare and
file a registration statement to permit the resale of the shares covered by this prospectus supplement. Pursuant to the stockholders' agreement, the selling stockholder has agreed to a
standstill provision that, among other things, prohibits it from acquiring additional shares of our common stock without our consent, subject to certain exceptions and limitations.
The
stockholders' agreement also provides that, for so long as the selling stockholder holds at least 7.5% of the outstanding shares of AAM common stock, the selling stockholder will
have the right to nominate to the board of directors:
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if the total number of directors on the board is 11:
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if the selling stockholder and any affiliate stockholder beneficially own, in the aggregate, greater than 18% of the outstanding
AAM common stock, 3 directors;
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if the selling stockholder and any affiliate stockholder beneficially own, in the aggregate, greater than 9% and less than or
equal to 18% of the outstanding AAM common stock, 2 directors; and
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if the selling stockholder and any affiliate stockholder beneficially own, in the aggregate, less than or equal to 9% of the
outstanding AAM common stock, 1 director; and
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if the total number of directors on the board is less than 11 or greater than 11, a number of directors equal to such total number of directors
multiplied by the percentage of outstanding shares of AAM common stock beneficially owned by the selling stockholder and any affiliate stockholder, rounding up in the case of any resulting fractional
number of directors.
The
amounts and percentages of shares beneficially owned are reported on the basis of SEC regulations governing the determination of beneficial ownership of securities. Under SEC rules,
a person is deemed to be a "beneficial owner" of a security if that person has or shares voting power or investment power, which includes the power to dispose of or to direct the disposition of such
security. A person is also deemed to be a beneficial owner of any securities of which that person has a right to acquire beneficial ownership within 60 days.
Until
the expiration date of the stockholders' agreement or for so long as at least one director designated by the selling stockholder is serving on our board of directors, the selling
stockholder has agreed to vote in accordance with the recommendation of our board of directors with respect to the election or removal of directors to or from our board of directors; the compensation
of directors, officers or other employees of AAM (including say-on-pay matters and option grants); and the
engagement of accountants. There are currently three members of our board of directors that were nominated by the selling stockholder.
With
respect to any other matter (other than certain extraordinary transactions), the selling stockholder may vote their shares, at their discretion, either as recommended by our board
of directors or in the same proportion in which all shares of AAM common stock (other than shares owned by the selling stockholder and other controlled affiliates of American Securities (other than
its portfolio companies)) that voted or submitted a written consent on such matter are actually voted or consented.
Unless
otherwise noted, the address of each beneficial owner is c/o American Axle & Manufacturing Holdings Inc., One Dauch Drive, Detroit, Michigan 48211.
Our
calculation of the beneficial ownership is based on 111,290,072 shares of our common stock outstanding as of November 6, 2017. The following table, based upon information
currently known to
S-8
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us,
sets forth as of November 6, 2017 (i) the number of shares of common stock held of record or beneficially by the selling stockholder as of such date and (ii) the number of
shares that may be offered under this prospectus by the selling stockholder.
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Shares Beneficially
Owned Prior to the
Offering
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Shares Beneficially
Owned After the
Offering
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Shares to
be Sold in
the Offering
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Name of Beneficial Owner
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Number
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Percent
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Number
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Percent
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American Securities LLC(1)
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25,691,349
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23.1
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%
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15,000,000
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10,691,349
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9.6
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%
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(1)
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Represents
25,691,349 shares of common stock beneficially owned by American Securities LLC, a New York limited liability company ("ASLLC"), of which 8,670
shares are directly owned by ASLLC and 25,682,679 shares are directly owned by ASP MD Investco L.P, a Delaware limited partnership ("Investco"). American Securities Partners VI, L.P., a
Delaware limited partnership, American Securities Partners VI(B), L.P., a Delaware limited partnership, American Securities Partners VI(C), L.P., a Delaware limited partnership, and
American Securities Partners VI(D), L.P., a Delaware limited partnership together hold a majority of the limited partnership interests in Investco (the "Sponsors"). American Securities
Associates VI, LLC, a Delaware limited liability company (the "GP"), is the general partner of each Sponsor. ASLLC provides investment advisory services to each Sponsor and the GP. The
address of each of the entities listed above is c/o American Securities LLC, 299 Park Avenue, New York, NY 10171.
S-9
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MATERIAL U.S. FEDERAL INCOME TAX CONSEQUENCES TO NON-U.S. HOLDERS OF OUR COMMON STOCK
The following is a summary of the material U.S. federal income tax consequences to a non-U.S. holder (as defined below) of the purchase,
ownership and disposition of our common stock as of the date hereof. Except where noted, this summary deals only with common stock that is held as a capital asset
(
i.e.
, generally, an asset held for investment purposes).
A
"non-U.S. holder" means a beneficial owner (other than a partnership) that is not for U.S. federal income tax purposes any of the following:
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an individual citizen or resident of the United States;
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a corporation (or any other entity treated as a corporation for U.S. federal income tax purposes) created or organized in or under the laws of
the United States, any state thereof or the District of Columbia;
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an estate if its income is subject to U.S. federal income taxation regardless of its source; or
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a trust if it (1) is subject to the primary supervision of a court within the United States and one or more United States persons have
the authority to control all substantial decisions of the trust or (2) has a valid election in effect under applicable U.S. Treasury regulations to be treated as a United States person.
This
summary is based upon provisions of the Internal Revenue Code of 1986, as amended (the "Code"), and U.S. Treasury regulations, administrative rulings and judicial decisions as of
the date hereof. Those authorities may be changed, perhaps retroactively, and are subject to differing interpretations, so as to result in U.S. federal income tax consequences different from those
summarized below. This summary does not address all aspects of U.S. federal income taxes and does not deal with other U.S. federal tax laws (including the estate tax and the Medicare tax on certain
investment income) or any foreign, state, local or other tax considerations that may be relevant to non-U.S. holders in light of their particular circumstances. In addition, it does not represent a
detailed description of the U.S. federal income tax consequences applicable to you if you are subject to special treatment under the U.S. federal income tax laws (including, but not limited to, if you
are: a U.S. expatriate, a "controlled foreign corporation," a "passive foreign investment company," or a partnership or other pass-through entity or arrangement for U.S. federal income tax purposes
(and investors therein)). We cannot assure you that a change in law will not alter significantly the tax considerations that we describe in this summary.
If
an entity or arrangement treated as a partnership for U.S. federal income tax purposes holds our common stock, the tax treatment of a partner generally will depend upon the status of
the partner and the activities of the partnership. If you are a partner of a partnership holding our common stock, you should consult your tax advisors.
If
you are considering the purchase of our common stock, you should consult your own tax advisors concerning the particular U.S. federal income tax consequences to you of the purchase,
ownership, or disposition of our common stock, as well as the consequences to you arising under the laws of any other taxing jurisdiction or any applicable income tax treaty.
Dividends
Distributions of cash or property that we pay on our common stock (if any) will be treated as taxable dividends for U.S. federal income tax
purposes to the extent paid from our current or accumulated earnings and profits (as determined under U.S. federal income tax principles). If the amount of a distribution exceeds our current and
accumulated earnings and profits, such excess will be allocated ratably among each share of common stock with respect to which the distribution is paid and
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will
be treated first as a tax-free return of capital to the extent of the non-U.S. holder's adjusted tax basis in our common stock (but not below zero), and thereafter will be treated as capital gain
from a sale or other disposition of our common stock as described below in "Gain on Disposition of Common Stock." Your adjusted tax basis generally is the purchase price of the shares,
reduced by any prior tax-free returns of capital. Subject to the discussions of backup withholding and additional withholding requirements below, dividends paid to a non-U.S. holder of our common
stock generally will be subject to withholding of U.S. federal income tax at a 30% rate or such lower rate as may be specified by an applicable income tax treaty. However, dividends that are
effectively connected with the conduct of a trade or business by the non-U.S. holder within the United States (and, if required by an applicable income tax treaty, are attributable to a U.S. permanent
establishment of the non-U.S. holder) generally are not subject to U.S. federal withholding tax, provided certain certification and disclosure requirements are satisfied. Instead, such dividends
generally are subject to U.S. federal income tax on a net income basis in the same manner as if the non-U.S. holder were a United States person as defined under the Code. Any such effectively
connected dividends received by a foreign corporation may be subject to an additional "branch profits tax" on its effectively connected earnings and profits at a 30% rate or such lower rate as may be
specified by an applicable income tax treaty.
A
non-U.S. holder of our common stock who wishes to claim the benefit of an applicable income tax treaty rate and avoid backup withholding, as discussed below, for dividends will be
required (a) to complete the applicable Internal Revenue Service ("IRS") Form W-8 and certify under penalty of perjury that such holder is not a United States person as defined under the
Code and is eligible for treaty benefits or (b) if our common stock is held through certain foreign intermediaries, to satisfy the relevant certification requirements of applicable U.S.
Treasury regulations.
A
non-U.S. holder of our common stock eligible for a reduced rate of U.S. withholding tax pursuant to an income tax treaty may obtain a refund of any excess amounts withheld by timely
filing an appropriate claim for refund with the IRS.
Gain on Disposition of Common Stock
Subject to the discussions of backup withholding and additional withholding requirements below, any gain realized on the sale, exchange or other
taxable disposition of our common stock by a non-U.S. holder generally will not be subject to U.S. federal income tax unless:
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the gain is effectively connected with a trade or business of the non-U.S. holder in the United States (and, if required by an applicable
income tax treaty, is attributable to a U.S. permanent establishment of the non-U.S. holder);
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the non-U.S. holder is an individual who is present in the United States for 183 days or more in the taxable year of that disposition,
and certain other conditions are met; or
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we are or have been a "United States real property holding corporation" for U.S. federal income tax purposes.
A
non-U.S. holder described in the first bullet point immediately above generally will be subject to tax on the net gain derived from the sale under regular graduated U.S. federal income
tax rates applicable to such holder if it were a United States person as defined under the Code. In addition, if a non-U.S. holder described in the first bullet point immediately above is a
corporation for U.S. federal income tax purposes, it may be subject to the branch profits tax equal to 30% of its effectively connected earnings and profits or at such lower rate as may be specified
by an applicable income tax treaty.
An
individual non-U.S. holder described in the second bullet point immediately above generally will be subject to a flat 30% tax (or such lower rate specified by an applicable income tax
treaty) on
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the
gain derived from the sale, which may be offset by U.S. source capital losses, even though the individual is not considered a resident of the United States for U.S. federal income tax purposes.
We
believe we are not and do not anticipate becoming a "United States real property holding corporation" for U.S. federal income tax purposes. In general, a corporation is a "United
States real property holding corporation" if the fair market value of its "United States real property interests" equals or exceeds 50% of the sum of the fair market values of its worldwide (domestic
and foreign) real property interests and its other assets used or held for use in a trade or business (all as determined for U.S. federal income tax purposes). For this purpose, real property
interests include land, improvements, and associated personal property. If we are or become a "United States real property holding corporation," so long as our common stock continues to be regularly
traded on an established securities market (within the meaning of applicable U.S. Treasury regulations), only a non-U.S. holder who holds or held directly, indirectly, or constructively (at any time
during the shorter of the five year period preceding the date of disposition or the holder's holding period) more than 5% of our common stock will be subject to U.S. federal income tax on the
disposition of our common stock in the same manner as gain that is effectively connected with a trade or business of the non-U.S. holder in the United States, except that the branch profits tax
generally will not apply.
Information Reporting and Backup Withholding
We must report annually to the IRS and to each non-U.S. holder the amount of dividends paid to such holder and the tax withheld with respect to
such dividends, regardless of whether withholding was required. Copies of the information returns reporting such dividends and withholding may also be made available to the tax authorities in the
country in which the non-U.S. holder resides under the provisions of an applicable income tax treaty.
A
non-U.S. holder will be subject to backup withholding for dividends paid to such holder unless such holder certifies under penalty of perjury that it is a non-U.S. holder (and the
payor does not have actual knowledge or reason to know that such holder is a United States person as defined under the Code) on a properly executed IRS Form W-8BEN or IRS Form W-8BEN-E,
or such holder otherwise establishes an exemption.
Information
reporting and, depending on the circumstances, backup withholding will apply to the proceeds of a sale of our common stock within the United States or conducted through
certain U.S.-related financial intermediaries, unless the beneficial owner certifies under penalty of perjury that it is a non-U.S. holder (and the payor does not have actual knowledge or reason to
know that the beneficial owner is a United States person as defined under the Code), or such owner otherwise establishes an exemption.
Backup
withholding is not an additional tax. Any amounts withheld under the backup withholding rules may be allowed as a refund or a credit against a non-U.S. holder's U.S. federal
income tax liability provided the required information is timely furnished to the IRS.
Non-U.S.
holders should consult their own tax advisors regarding the application of information reporting and backup withholding in their particular circumstances, including the
procedure for claiming any applicable exemption.
Additional Withholding Requirements
Under Sections 1471 through 1474 of the Code and the Treasury regulations promulgated thereunder (such provisions commonly referred to as
"FATCA"), a 30% U.S. federal withholding tax may apply to any dividends paid on our common stock, and to the gross proceeds from a disposition of our common stock occurring after December 31,
2018, in each case paid to (i) a "foreign financial institution" (as specifically defined under FATCA), which does not provide sufficient documentation,
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typically
on IRS Form W-8BEN-E, evidencing either (x) an exemption from FATCA, or (y) its compliance (or deemed compliance) with FATCA (which alternatively may be in the form of
compliance with an intergovernmental agreement with the United States) in a manner that avoids withholding, or (ii) a "non-financial foreign entity" (as specifically defined under FATCA) which
does not provide sufficient documentation, typically on IRS Form W-8BEN-E, evidencing either (x) an exemption from FATCA, or (y) adequate information regarding certain substantial
United States beneficial owners of such entity (if any). If a dividend payment is both subject to withholding under FATCA and subject to the withholding tax discussed above under
"Dividends," the withholding under FATCA may be credited against, and therefore reduce, such other withholding tax. You should consult your own tax advisor
regarding these requirements and whether they may be relevant to your ownership and disposition of our common stock.
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UNDERWRITING
Deutsche Bank Securities Inc. is acting as the underwriter for this offering. We and the selling stockholder have entered into an underwriting
agreement with the underwriter dated the date of this prospectus supplement. Subject to the terms and conditions of the underwriting agreement, the selling stockholder has agreed to sell to the
underwriter, and the underwriter has agreed to purchase, at a price of $ per share, which will result in gross proceeds to the selling stockholder of approximately
$ , the
number of shares of common stock listed next to its name in the following table:
|
|
|
|
|
Name
|
|
Number of Shares
|
|
Deutsche Bank Securities Inc.
|
|
|
15,000,000
|
|
Total
|
|
|
15,000,000
|
|
Subject
to the terms and conditions of the underwriting agreement, the underwriter is committed to purchase all the common shares offered by the selling stockholder if it purchases any
shares.
The
underwriter may offer the shares of common stock from time to time for sale in one or more transactions on the New York Stock Exchange, in the over-the-counter market, through
negotiated transactions or otherwise at market prices prevailing at the time of sale or at negotiated prices. The underwriter may effect such transactions by selling shares of common stock to or
through dealers, and such dealers may receive compensation in the form of discounts, concessions or commissions from the underwriter and/or purchasers of shares of common stock for whom they may act
as agents or to whom they may sell as principal. The difference between the price at which the underwriter purchases shares and the price at which the underwriter resells such shares may be deemed
underwriting compensation. Sales of shares made outside the United States may be made by affiliates of the underwriter.
We
estimate that the total expenses of this offering payable by us, including registration, filing fees, printing fees and legal and accounting expenses, but excluding the underwriting
discounts and commissions, which will be payable by the selling stockholder, will be approximately $ .
We
have agreed to reimburse the underwriter for filing fees and reasonable fees and disbursements of counsel related to clearance of this offering with the Financial Industry Regulatory
Authority, Inc. ("FINRA"), if applicable.
A
prospectus in electronic format may be made available on the websites maintained by the underwriter, or selling group members, if any, participating in the offering. The underwriter
may agree to allocate a number of shares to the underwriter and selling group members for sale to their online brokerage account holders. Internet distributions will be allocated by the underwriter
and selling group members that may make Internet distributions on the same basis as other allocations.
The
Company has agreed that it will not (A) offer for sale, sell, pledge, or otherwise dispose of (or enter into any transaction that is designed to, or could be expected to,
result in the disposition by any person at any time in the future of), or file with the SEC a registration statement under the Securities
Act related to, any shares of our common stock, preferred stock or other forms of equity authorized and issued by us and any instruments convertible into or exercisable or exchangeable for any of the
foregoing (other than the grant of equity awards with respect to, or issuances under, any of the Company's bona fide equity incentive plans already in existence), (B) enter into any swap or
other derivatives transaction that transfers to another person, in whole or in part, any of the economic benefits or risks of ownership of any such equity interests, whether any such transaction
described in clause (A) above or this clause (B) is to be settled by delivery of securities, in cash or otherwise, or (C) publicly disclose the intention to do any of the
foregoing, in each case, for a period of 30 days after the date of this prospectus supplement.
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In
addition, the selling stockholder has agreed that, for a period of 30 days after the date of this prospectus supplement, it will not, subject to certain exceptions, without the
prior written consent of the underwriter, (1) offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or
warrant to purchase, or otherwise transfer or dispose of, directly or indirectly, any shares of our common stock or any securities convertible into or exercisable or exchangeable for our common stock
(including without limitation, common stock or such other securities which may be deemed to be beneficially owned by the selling stockholder in accordance with the rules and regulations of the SEC and
securities which may be issued upon exercise of a stock option or warrant), or publicly disclose the intention to make any offer, sale, pledge or disposition, (2) enter into any swap or other
agreement that transfers, in whole or in part, any of the economic consequences of ownership of our common stock or such other securities, whether any such transaction described in clause (1)
or (2) above is to be settled by delivery of common stock or such other securities, in cash or otherwise or (3) make any demand for or exercise any right with respect to the registration
of any shares of our common stock or any security convertible into or exercisable or exchangeable for our common stock. The lock-up restrictions will contain exceptions for, among other things,
transfers of stock to certain persons or entities controlled by or affiliated with the selling stockholder, transfers of stock by operation of law, sales of stock purchased on the open market
following this offering, and exercises of registration rights that do not result in public announcements or filings of registration statements during the lock-up period.
The
selling stockholder in this offering represents beneficial ownership of 25,691,349 shares of our common stock before and 10,691,349 shares after completion of this offering, or
approximately 23.1% of the outstanding shares of our common stock before completion of this offering and 9.6% after completion of this offering.
We
and the selling stockholder have agreed to indemnify the underwriter against certain liabilities, including liabilities under the Securities Act, or contribute payments that the
underwriter may be required to make in that respect.
In
connection with this offering, the underwriter may engage in stabilizing transactions, which involves making bids for, purchasing and selling shares of common stock in the open market
for the purpose of preventing or retarding a decline in the market price of the common stock while this offering is in progress. These stabilizing transactions may include making short sales of the
common stock, which involves the sale by the underwriter of a greater number of shares of common stock than it is required to purchase in this offering, and purchasing shares of common stock on the
open market to cover positions created by short sales. The underwriter may close out any covered short position by purchasing shares in the open market.
The
underwriter has advised us that, pursuant to Regulation M of the Securities Act, it may also engage in other activities that stabilize, maintain or otherwise affect the price
of the common stock, including the imposition of penalty bids.
These
activities may have the effect of raising or maintaining the market price of the common stock or preventing or retarding a decline in the market price of the common stock, and, as
a result, the price of the common stock may be higher than the price that otherwise might exist in the open market. If the underwriter commences these activities, it may discontinue them at any time.
The underwriter may carry out these transactions on the New York Stock Exchange, in the over-the-counter market or otherwise.
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Selling Restrictions
General
Other than in the United States, no action has been taken by us or the underwriter that would permit a public offering of the shares of our
common stock offered by this prospectus supplement and the accompanying prospectus in any jurisdiction where action for that purpose is required. The shares of our common stock offered by this
prospectus supplement and the accompanying prospectus may not be offered or sold, directly or indirectly, nor may this prospectus
supplement and the accompanying prospectus or any other offering material or advertisements in connection with the offer and sale of any such shares be distributed or published in any jurisdiction,
except under circumstances that will result in compliance with the applicable rules and regulations of that jurisdiction. Persons into whose possession this prospectus supplement and the accompanying
prospectus come are advised to inform themselves about and to observe any restrictions relating to the offering and the distribution of this prospectus supplement and the accompanying prospectus. This
prospectus supplement and the accompanying prospectus do not constitute an offer to sell or a solicitation of an offer to buy any shares of our common stock offered by this prospectus supplement and
the accompanying prospectus in any jurisdiction in which such an offer or a solicitation is unlawful.
United Kingdom
Any invitation or inducement to engage in investment activity (within the meaning of Section 21 of the Financial Services and Markets Act
2000, as amended (the "FSMA")) in connection with the issue or sale of any shares has only been communicated or caused to be communicated and will only be communicated or caused to be communicated in
circumstances in which Section 21(1) of the FSMA does not apply to us.
All
applicable provisions of the FSMA must be complied with in respect to anything done by any person in relation to the shares in, from or otherwise involving the United Kingdom.
This
prospectus supplement and the accompanying prospectus are only being distributed to and are only directed at (i) persons who are outside the United Kingdom,
(ii) investment professionals falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the "Order"), (iii) high
net worth companies, and other entities falling within Article 49(2)(a) to (d) of the Order or (iv) any other persons to whom it may otherwise lawfully be communicated under the
Order (all such persons together being referred to as "relevant persons"). The shares are only available to, and any invitation, offer or agreement to subscribe, purchase or otherwise acquire such
shares will be engaged in only with, relevant persons. Any person who is not a relevant person should not act or rely on this prospectus supplement and the accompanying prospectus or any of its
contents.
Switzerland
The shares may not be publicly offered in Switzerland and will not be listed on the SIX Swiss Exchange ("SIX") or on any other stock exchange or
regulated trading facility in Switzerland. This prospectus supplement and the accompanying prospectus have been prepared without
regard to the disclosure standards for issuance prospectuses under art. 652a or art. 1156 of the Swiss Code of Obligations or the disclosure standards for listing prospectuses under art. 27 ff. of the
SIX Listing Rules or the listing rules of any other stock exchange or regulated trading facility in Switzerland. Neither this prospectus supplement, the accompanying prospectus nor any other offering
or marketing material relating to the shares or the offering may be publicly distributed or otherwise made publicly available in Switzerland.
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Neither
this prospectus supplement, the accompanying prospectus nor any other offering or marketing material relating to the offering, us, or the shares have been or will be filed with
or approved by any Swiss regulatory authority. In particular, this prospectus supplement and the accompanying prospectus will not be filed with, and the offer of shares will not be supervised by, the
Swiss Financial Market Supervisory Authority ("FINMA"), and the offer of shares has not been and will not be authorized under the Swiss Federal Act on Collective Investment Schemes ("CISA"). The
investor protection afforded to acquirers of interests in collective investment schemes under the CISA does not extend to acquirers of shares of our common stock.
European Economic Area
In relation to each Member State of the European Economic Area (each, a "Member State"), from and including the date on which the Prospectus
Directive was implemented in that Member State (the "Relevant Implementation Date"), an offer of shares described in this prospectus supplement or the accompanying prospectus has not and will not be
made to the public in that Member State, except that, with effect from and including the Relevant Implementation Date, an offer of shares described in this prospectus supplement and the accompanying
prospectus may be made to the public in that Member State at any time:
(a) to
any legal entity which is a qualified investor as defined in the Prospectus Directive;
(b) to
fewer than 150 natural or legal persons (other than qualified investors as defined in the Prospectus Directive), as permitted under the Prospectus Directive, subject
to obtaining the prior consent of the underwriter for any such offer; or
(c) in
any other circumstances falling within Article 3(2) of the Prospectus Directive,
provided
that no such offer of shares shall require us or the underwriter to publish a prospectus pursuant to Article 3 of the Prospectus
Directive.
For
the purposes of this provision, the expression an "offer of shares to the public" in relation to any shares in any Member State means the communication in any form and by any means
of sufficient information on the terms of the offer and the shares to be offered so as to enable an investor to decide to purchase or subscribe any shares, as the same may be varied in that Member
State by any measure implementing the Prospectus Directive in that Member State, and the expression "Prospectus Directive" means Directive 2003/71/EC (as amended, including by Directive 2010/73/EU),
and includes any relevant implementing measure in the Member State.
Dubai International Financial Centre
This prospectus supplement and the accompanying prospectus relate to an "Exempt Offer"in accordance with the Offered Securities Rules of the
Dubai Financial Services Authority ("DFSA"). This prospectus supplement and the accompanying prospectus are intended for distribution only to persons of a type specified in the Offered Securities
Rules of the DFSA. It must not be delivered to, or relied on by, any other person. The DFSA has no responsibility for reviewing or verifying any documents in connection with Exempt Offers. The DFSA
has not approved this prospectus supplement or the accompanying prospectus nor taken steps to verify the information set forth herein and has no responsibility for the prospectus supplement or the
accompanying prospectus. The shares to which this prospectus supplement and the accompanying prospectus relate may be illiquid or subject to restrictions on their resale. Prospective purchasers of the
shares offered hereby should conduct their own due diligence on the shares. If you do not understand the contents of this prospectus supplement and the accompanying prospectus you should consult an
authorized financial advisor.
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Australia
No placement document, prospectus, product disclosure statement or other disclosure document has been lodged with the Australian Securities and
Investments Commission ("ASIC"), in relation to the offering. This prospectus supplement and the accompanying prospectus do not constitute a prospectus, product disclosure statement or other
disclosure document under the Corporations Act 2001 (the "Corporations Act"), and do not purport to include the information required for a prospectus, product disclosure statement or other disclosure
document under the Corporations Act.
Any
offer in Australia of the shares may only be made to persons (the "Exempt Investors") who are "sophisticated investors" (within the meaning of section 708(8) of the
Corporations Act), "professional investors" (within the meaning of section 708(11) of the Corporations Act) or otherwise pursuant to one or more exemptions contained in section 708 of
the Corporations Act so that it is lawful to offer the shares without disclosure to investors under Chapter 6D of the Corporations Act.
The
shares applied for by Exempt Investors in Australia must not be offered for sale in Australia in the period of 12 months after the date of allotment under the offering, except
in circumstances where disclosure to investors under Chapter 6D of the Corporations Act would not be required pursuant to an exemption under section 708 of the Corporations Act or
otherwise or where the offer is pursuant to a disclosure document which complies with Chapter 6D of the Corporations Act. Any person acquiring shares must observe such Australian on-sale
restrictions.
This
prospectus supplement and the accompanying prospectus contain general information only and do not take account of the investment objectives, financial situation or particular needs
of any particular person. They do not contain any securities recommendations or financial product advice. Before making an investment decision, investors need to consider whether the information in
this prospectus supplement and the accompanying prospectus is appropriate to their needs, objectives and circumstances, and, if necessary, seek expert advice on those matters.
Hong Kong
The shares may not be offered or sold by means of any document other than (a) in circumstances which do not constitute an offer to the
public within the meaning of the Companies Ordinance (Cap. 32, Laws of Hong Kong); (b) to "professional investors" as within the meaning of the Securities and Futures Ordinance
(Cap. 571, Laws of Hong Kong) and any rules made thereunder; or (c) in other circumstances which do not result in the document being a "prospectus" as defined in the
Companies Ordinance (Cap. 32, Laws of Hong Kong), and no advertisement, invitation or document relating to the shares may be issued or may be in the possession of any person for the purpose of
issue (in each case whether in Hong Kong or elsewhere), which is directed at, or the contents of which are likely to be accessed or read by, the public of Hong Kong (except if permitted to do so under
the securities laws of Hong Kong) other than with respect to shares which are or are intended to be disposed of only to persons outside Hong Kong or only to "professional investors" as defined in the
Securities and Futures Ordinance (Cap. 571, Laws of Hong Kong) and any rules made thereunder.
Japan
The shares have not been and will not be registered under the Financial Instruments and Exchange Law of Japan (the "Financial Instruments and
Exchange Law") and, accordingly, will not be offered or sold, directly or indirectly, in Japan, or to, or for the benefit of, any resident of Japan (which term as used herein means any person resident
in Japan, including any corporation or other entity organized under the laws of Japan), or to others for re-offering or resale, directly or indirectly, in Japan or to, or for the benefit of, a
resident of Japan, except pursuant to an exemption from the registration requirements of, and otherwise in compliance with, the Financial Instruments and Exchange Law and any other applicable laws,
regulations and ministerial guidelines of Japan.
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Singapore
This prospectus supplement and the accompanying prospectus have not been registered as a prospectus with the Monetary Authority of Singapore.
Accordingly, this prospectus supplement and the accompanying prospectus and any other document or material in connection with the offer or sale, or invitation for subscription or purchase, of the
shares may not be circulated or distributed, nor may the shares be offered or sold, or be made the subject of an invitation for subscription or purchase, whether directly or indirectly, to persons in
Singapore other than (i) to an institutional investor under Section 274 of the Securities and Futures Act, Chapter 289 of Singapore (the "SFA"), (ii) to a relevant person,
or any person pursuant to Section 275(1A) of the SFA, and in accordance with the conditions specified in Section 275 of the SFA, or (iii) otherwise pursuant to, and in accordance
with the conditions of, any other applicable provision of the SFA.
Where
the shares are subscribed or purchased under Section 275 of the SFA by a relevant person which is: (a) a corporation (which is not an accredited investor), the sole
business of which is to hold investments and the entire share capital of which is owned by one or more individuals, each of whom is an accredited investor; or (b) a trust (where the trustee is
not an accredited investor) whose sole purpose is to hold investments and each beneficiary is an accredited investor, shares, debentures and units of shares and debentures of that corporation or the
beneficiaries' rights and interest in that trust shall not be transferable for six months after that corporation or that trust has acquired the shares under Section 275 of the SFA except:
(1) to an institutional investor under Section 274 of the SFA or to a relevant person, or any person pursuant to Section 275(1A) of the SFA, and in accordance with the conditions
specified in Section 275 of the SFA; (2) where no consideration is given for the transfer; or (3) by operation of law.
Canada
The shares may be sold only to purchasers purchasing, or deemed to be purchasing, as principal that are accredited investors, as defined in
National Instrument 45-106 Prospectus Exemptions or subsection 73.3(1) of the Securities Act (Ontario), and are permitted clients, as defined in National Instrument 31-103
Registration Requirements, Exemptions and Ongoing Registrant Obligations. Any resale of the shares must be made in accordance with an exemption from, or in a transaction not subject to, the prospectus
requirements of applicable securities laws.
Securities
legislation in certain provinces or territories of Canada may provide a purchaser with remedies for rescission or damages if this prospectus supplement or the accompanying
prospectus (including any amendment thereto) contains a misrepresentation, provided that the remedies for rescission or damages are exercised by the purchaser within the time limit prescribed by the
securities legislation of the purchaser's province or territory. The purchaser should refer to any applicable provisions of the securities legislation of the purchaser's province or territory for
particulars of these rights or consult with a legal advisor.
Pursuant
to section 3A.3 of National Instrument 33-105 Underwriting Conflicts ("NI 33-105"), the underwriter is not required to comply with the disclosure
requirements of NI 33-105 regarding underwriter conflicts of interest in connection with this offering.
Other Relationships
The underwriter and its affiliates have provided in the past to us, the selling stockholder and our respective affiliates and may provide from
time to time in the future certain
commercial banking, financial advisory, investment banking and other services for us, the selling stockholder and such affiliates in the ordinary course of their business, for which it has received
and may continue to receive customary fees and commissions. The underwriter and its affiliates are full service financial institutions engaged in various activities, which may include securities
trading, commercial and investment banking,
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financial
advisory, investment management, investment research, principal investment, hedging, financing and brokerage activities.
In
addition, from time to time, the underwriter and its affiliates may effect transactions for their own accounts or the accounts of customers, and hold on behalf of themselves or their
customers, long or short positions in our debt or equity securities or loans, and may do so in the future. In the ordinary course of their various business activities, the underwriter and its
affiliates may make or hold a broad array of investments and actively trade debt and equity securities (or related derivative securities) and financial instruments (including bank loans) for their own
accounts and for the accounts of their customers, and such investment and securities activities may involve our securities and/or instruments or those of our subsidiaries. The underwriter and its
affiliates may also make investment recommendations and/or publish or express independent research views in respect of such securities or instruments and may at any time hold, or recommend to clients
that they acquire, long and/or short positions in such securities and instruments.
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LEGAL MATTERS
The validity of the shares of common stock will be passed upon for us by Shearman & Sterling LLP, 599 Lexington Avenue, New York,
New York 10022. Certain legal matters relating to this offering will be passed upon for the underwriter by Cravath, Swaine & Moore LLP, New York, New York.
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRMS
The consolidated financial statements, and the related financial statement schedule, incorporated in this prospectus by reference from Holdings'
Annual Report on Form 10-K,
and the effectiveness of Holdings' internal control over financial reporting have been audited by Deloitte & Touche LLP, an independent registered public accounting firm, as stated in
their report, which is incorporated herein by reference. Such consolidated financial statements and financial statement schedule have been so incorporated in reliance upon the report of such firm
given upon their authority as experts in accounting and auditing.
The
consolidated financial statements, and the related financial statement schedule, of MPG as of and for the year ended December 31, 2016, incorporated in this prospectus by
reference from Item 9.1 of the Current Report on Form 8-K/A filed by Holdings on March 6, 2017, and the effectiveness of MPG's internal control over financial reporting as of
December 31, 2016, have been audited by Deloitte & Touche LLP, an independent registered public accounting firm, as stated in their reports, which are incorporated herein by
reference. Such consolidated financial statements and financial statement schedule have been so incorporated in reliance upon the report of such firm given upon their authority as experts in
accounting and auditing.
The
consolidated balance sheet of MPG and its subsidiaries as of December 31, 2015, and the related consolidated statements of operations, comprehensive income, stockholders'
equity (deficit), and cash flows for each of the years in the two-year period ended December 31, 2015, and the related financial statement schedule for each of the years in the two-year period
ended December 31, 2015, incorporated by reference in Holdings' Current Report on Form 8-K/A, have been incorporated by reference in this prospectus in reliance upon the report of
KPMG LLP, an independent registered public accounting firm, incorporated by reference herein and upon the authority of said firm as experts in accounting and auditing.
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WHERE YOU CAN FIND MORE INFORMATION
This prospectus supplement and the accompanying prospectus are part of the registration statement on Form S-3 we filed with the SEC under
the Securities Act and do not contain all the information set forth in the registration statement. Whenever a reference is made in this prospectus supplement or the accompanying prospectus to any of
our contracts, agreements or other documents, the reference may not be complete and you should refer to the exhibits that are a part of the registration statement or the exhibits to the reports or
other documents incorporated by reference in this prospectus supplement and the accompanying prospectus for a copy of such contract, agreement or other document. Because we are subject to the
information and reporting requirements of the Exchange Act, we file annual, quarterly and current reports, proxy statements and other information
with the SEC. Our SEC filings are available to the public at the SEC's website at http://www.sec.gov. You may also read and copy any document we file at the SEC's Public Reference Room at
100 F Street, N.E., Washington, D.C. 20549. Please call the SEC at 1-800-SEC-0330 for further information on the operation of the Public Reference Room.
INFORMATION INCORPORATED BY REFERENCE
We are incorporating by reference into this prospectus supplement certain information that Holdings has filed with the SEC, which means that we
are disclosing important information to you by referring you to other documents. This prospectus supplement incorporates by reference the documents listed below and any future filings made by Holdings
with the SEC under the Securities Exchange Act of 1934, as amended (the "Exchange Act") on or after the date of this prospectus supplement and prior to termination of this offering.
The
following documents, which have been filed with the SEC by Holdings, are hereby incorporated by reference into this prospectus supplement:
-
-
Annual Report on Form 10-K of Holdings for the fiscal year ended December 31, 2016 filed on February 10, 2017, as amended
by Amendment No. 1 to Annual Report on Form 10-K/A of Holdings for the fiscal year ended December 31, 2016 filed on March 6, 2017.
-
-
Quarterly Report on Form 10-Q of Holdings for the quarter ended March 30, 2017 filed on May 5, 2017, for the quarter ended
June 30, 2017 filed on July 28, 2017, and for the quarter ended September 30, 2017 filed on November 3, 2017.
-
-
Current Report on Form 8-K filed on November 3, 2016, as amended by Amendment No. 1 on Form 8-K/A filed on
March 6, 2017, and the Current Reports on Form 8-K filed on January 24, 2017, March 6, 2017, March 9, 2017, March 23, 2017, April 3, 2017,
April 5, 2017, April 6, 2017, April 12, 2017, May 5, 2017, May 17, 2017, and November 7, 2017.
Nothing
in this prospectus supplement shall be deemed to incorporate information furnished, but not filed, with the SEC, including information pursuant to Item 2.02 or
Item 7.01 of Form 8-K and corresponding information furnished under Item 9.01 of Form 8-K or included as an exhibit. Any statement contained in a document incorporated or
deemed to be incorporated herein by reference, or contained in this prospectus supplement, shall be deemed to be modified or superseded for purposes of this prospectus supplement to the extent that a
statement contained herein or in any other subsequently dated or filed document that also is or is deemed to be incorporated by reference herein modifies or supersedes such statement. Any such
statement so modified or superseded shall not be deemed, except as so modified or superseded, to constitute a part of this prospectus supplement.
The
information incorporated by reference is an important part of this prospectus supplement. Neither we, the selling stockholder nor the underwriter has authorized anyone to provide you
with information other than that contained in, or incorporated by reference into, this prospectus supplement. You should not assume that the information in this prospectus supplement is accurate as
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of
any date other than the date of this prospectus supplement. This prospectus supplement contains summaries of certain agreements that we have entered into or expect to enter into in connection with
this offering. The description of these agreements contained in this prospectus supplement do not purport to be complete and are subject to, or qualified in their entirety by reference to, the
definitive agreements. Copies of the definitive agreements will be made available without charge to you by making a written request to us at the following address: American Axle & Manufacturing
Holdings, Inc., One Dauch Drive, Detroit, Michigan 48211-1198. Our telephone number is 313-758-2000.
Our
reports and documents incorporated by reference into this prospectus supplement or the accompanying prospectus may also be found in the "Investors" section of our website at
www.aam.com. Our website and the information contained in it or connected to it shall not be deemed to be incorporated into this prospectus supplement, the accompanying prospectus or any registration
statement of which it forms a part.
S-23
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PROSPECTUS
AMERICAN AXLE & MANUFACTURING, INC.
AMERICAN AXLE & MANUFACTURING HOLDINGS, INC.
AAM International Holdings, Inc.
AccuGear, Inc.
Alpha SPV I, Inc.
Auburn Hills Manufacturing, Inc.
Colfor Manufacturing, Inc.
MSP Industries Corporation
Oxford Forge, Inc.
Debt Securities
Guarantees
Warrants to Purchase Debt Securities
Warrants to Purchase Common Stock
Common Stock
Preferred Stock
We will provide the specific terms of these securities in supplements or term sheets to this prospectus and whether an offer will be made by us, a
selling security holder or both. You should read this prospectus, the prospectus supplements and term sheets carefully before you invest.
We
will not use this prospectus to confirm sales of any securities unless it is attached to a prospectus supplement or a term sheet.
American
Axle & Manufacturing Holdings, Inc.'s common stock is listed on the New York Stock Exchange under the symbol "AXL."
Investments in our securities involve risks. See "Risk Factors" beginning on page 1 of this prospectus.
Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these
securities or passed upon the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense.
THE
DATE OF THIS PROSPECTUS IS MARCH 30, 2017.
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You should rely only on the information contained or incorporated by reference in this prospectus and in any accompanying prospectus supplement. No one has been
authorized to provide you with different information.
The securities are not being offered in any jurisdiction where the offer is not permitted.
You should not assume that the information contained in or incorporated by reference in this prospectus or any prospectus supplement is accurate as of any date
other than the date on the front of the documents.
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RISK FACTORS
Your investment in the securities involves certain risks. In consultation with your own financial and legal advisers, you should carefully
consider whether an investment in the securities is suitable for you. The securities are not an appropriate investment for you if you do not understand the terms of the securities or financial matters
generally. Risks relating to the securities will be set forth in the relevant prospectus supplement for the offering of such securities. In addition, certain factors that may adversely affect the
business of AAM Inc. (as defined below) or Holdings (as defined below) are discussed in our periodic reports referred to in "Where You Can Find More Information," below. For example, Holdings'
Annual Report on Form 10-K for the fiscal year ended December 31, 2016, contains a discussion of significant risks that could be relevant to an investment in the securities. You should
not purchase the securities described in this prospectus unless you understand and know you can bear all of the investment risks involved.
WHERE YOU CAN FIND MORE INFORMATION
We are required to comply with the reporting requirements of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and, in
accordance with those requirements, we file combined reports, proxy statements and other information with the Securities and Exchange Commission (the "SEC"). Unless the context otherwise requires,
references in this prospectus to the "company," "we," "our," and "us" shall mean collectively (i) American Axle & Manufacturing, Inc., or AAM Inc., a Delaware corporation,
and its direct and indirect subsidiaries and (ii) American Axle & Manufacturing Holdings, Inc., or Holdings, a Delaware corporation and the direct parent corporation of
AAM Inc.
You
can call the SEC's toll-free number at 1-800-SEC-0330 for further information. The SEC maintains a website at www.sec.gov that contains reports, proxy and information statements and
other information regarding companies like ours that file with the SEC electronically. The documents can be found by searching the EDGAR archives at the SEC's website or can be inspected and copied at
the Public Reference Section of the SEC located at 100 F Street, NE, Washington, D.C. 20549. Our SEC filings and other information about us may also be obtained from our website at www.aam.com,
although information on our website does not constitute a part of this prospectus. Material that we have filed may also be inspected at the library of the New York Stock Exchange, 20 Broad Street, New
York, New York 10005.
The
SEC allows us to "incorporate by reference" the information we file with them, which means that we can disclose important information to you by referring you to those documents that
are considered part of this prospectus. Later information that we file will automatically update and supersede this information. We incorporate by reference the documents listed below and any future
filings we make with the SEC under Section 13(a), 13(c), 14 or 15(d) of the Exchange Act (other than information furnished under Items 2.02 or 7.01 of Form 8-K) (i) after
the date of the filing of this registration statement and prior to effectiveness and (ii) until the offering of the particular securities covered by a prospectus supplement or term sheet has
been completed. This prospectus is part of a registration statement filed with the SEC.
We
are incorporating by reference into this prospectus the following documents filed with the SEC (excluding any portions of such documents that have been "furnished" but not "filed" for
purposes of the Exchange Act):
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-
Holdings' Annual Report on Form 10-K for the fiscal year ended December 31, 2016 filed with the SEC on February 10, 2017,
as amended by Holdings' Amendment No. 1 to Annual Report on Form 10-K/A filed with the SEC on March 6, 2017.
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Holdings' Current Report on Form 8-K filed with the SEC on November 3, 2016, as amended by Amendment No. 1 on
Form 8-K/A filed on March 6, 2017, and the Current Report on Form 8-K
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filed
on January 24, 2017, February 23, 2017 (with respect to Item 8.01 information only), March 6, 2017, March 7, 2017 (with respect to Item 8.01 information
only), March 9, 2017, March 23, 2017 and March 29, 2017.
-
-
The description of our common stock contained in our Registration Statement on From 8-A filed pursuant to Section 12(b) of the Exchange
Act including any amendment or report updating such description.
-
-
the following sections from Holdings' Registration Statement on Form S-4/A filed by Holdings on March 6, 2017:
"SummaryGeneralThe Merger," "GeneralThe Companies," "GeneralMerger Consideration to be Received by MPG Stockholders,"
"GeneralAAM Board of Directors Following Completion of the Merger," "The Merger Agreement," "The Voting Agreement," "The Stockholders'
Agreement," and "Financing;" "Special Note Regarding Forward-Looking Statements;" "The Companies;" and "Financing Related to the Merger."
The
documents incorporated by reference in this prospectus are available from us upon request. We will provide a copy of any and all of the information that is incorporated by reference
in this prospectus to any person, without charge, upon written or oral request. Requests for such copies should be directed to the following:
American
Axle & Manufacturing Holdings, Inc.
Attention: Investor Relations
One Dauch Drive
Detroit, Michigan 48211-1198
Telephone Number: (313) 758-4814
Except
as provided above, no other information, including, but not limited to, information on our websites is incorporated by reference in this prospectus.
AMERICAN AXLE & MANUFACTURING
We are a global Tier I supplier to the automotive industry. We manufacture, engineer, design and validate driveline and drivetrain
systems and related components and chassis modules for light trucks, sport utility vehicles (SUVs), crossover vehicles, passenger cars and commercial vehicles. Driveline and drivetrain systems include
components that transfer power from the transmission and deliver it to the drive wheels. Our driveline, drivetrain and related products include axles, driveheads, chassis modules, driveshafts, power
transfer units, transfer cases, chassis and steering components, transmission parts, electric drive systems and metal-formed products. In addition to locations in the United States (U.S.) (Michigan,
Ohio and Indiana), we also have offices or facilities in Brazil, China, Germany, India, Japan, Luxembourg, Mexico, Poland, Scotland, South Korea, Sweden and Thailand.
We
are the principal supplier of driveline components to General Motors Company (GM) for its full-size rear-wheel drive (RWD) light trucks and SUVs manufactured in North America,
supplying substantially all of GM's rear axle and four-wheel drive and all-wheel drive (4WD/AWD) axle requirements for these vehicle platforms. Sales to GM were approximately 67% of our consolidated
net sales in 2016, 66% in 2015, and 68% in 2014.
We
are the sole-source supplier to GM for certain axles and other driveline products for the life of each GM vehicle program covered by Lifetime Program Contracts and Long Term Program
Contracts (collectively, LPCs). Substantially all of our sales to GM are made under purchase orders pursuant to the LPCs. The LPCs have terms equal to the lives of the relevant
vehicle programs or their respective derivatives, which typically run five to seven years, and require us to remain competitive with respect to technology, design, quality and cost.
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We
also supply driveline system products to FCA US LLC (FCA) for heavy-duty Ram full-size pickup trucks and its derivatives, the AWD Jeep Cherokee, and a passenger car driveshaft
program. Sales to FCA were approximately 18% of our consolidated net sales in 2016, 20% in 2015 and 18% in 2014. In addition to GM and FCA, we supply driveline systems and other related components to
Nissan Motor Co., Ltd. (Nissan), Mercedes-Benz, Volkswagen AG (Volkswagen), Audi AG (Audi), Jaguar Land Rover Automotive PLC (JLR), Honda Motor Co., Ltd., Ford Motor
Company (Ford), PACCAR Inc., Daimler Truck, AB Volvo (Volvo), Harley-Davidson Inc. and other original equipment manufacturers (OEMs) and Tier I supplier companies such as
Jatco Ltd. and Hino Motors Ltd. Our consolidated net sales to customers other than GM were $1,287.8 million in 2016 as compared to $1,317.1 million in 2015 and
$1,199.9 million in 2014.
Our
principal served market is the driveline market, which consists of driveline, drivetrain, and related components, including metal-formed products and chassis modules for light
trucks, SUVs, crossover vehicles, passenger cars and commercial vehicles, in the regions in which we compete.
USE OF PROCEEDS
Except as may be described otherwise in a prospectus supplement or term sheet, we will add the net proceeds from the sale of the securities
under this prospectus to our general funds and will use them for working capital and other general corporate purposes, which may include, among other things, reducing or refinancing indebtedness or
funding acquisitions.
PROSPECTUS
This prospectus is part of a registration statement that we filed with the SEC utilizing a "shelf" registration process. Under this shelf
process, any combination of the following securities may be sold in one or more offerings:
-
-
debt securities ("debt securities"), which may be either senior (the "senior securities") or subordinated (the "subordinated securities"),
unsecured ("unsecured debt securities") or secured ("secured debt securities") guaranteed by Holdings and/or certain subsidiaries which may include AAM International Holdings, Inc.,
AccuGear, Inc., Alpha SPV I, Inc.(which will merge with and into Metaldyne Performance Group, Inc. ("MPG") pursuant to the definitive merger agreement among Holdings, MPG and
Alpha SPV I, Inc. dated November 3, 2016 pursuant to which AAM will acquire MPG) Auburn Hills Manufacturing, Inc., Colfor Manufacturing, Inc., MSP Industries Corporation
and Oxford Forge, Inc. (collectively, the "Subsidiary Guarantors," and, together with Holdings, the "Guarantors");
-
-
warrants to purchase debt securities ("debt warrants");
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shares of the common stock of Holdings ("common stock");
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shares of Holdings' preferred stock ("preferred stock"); or
-
-
warrants to purchase common stock of Holdings ("common stock warrants," and the shares underlying such common stock warrants, the "warrant
shares").
The
terms of the securities will be determined at the time of offering.
We
will refer to the debt securities, debt warrants, common stock warrants, warrant shares, the guarantees of the debt securities, common stock and preferred stock, or any combination of
those securities, proposed to be sold under this prospectus and the applicable prospectus supplement or term sheet as the "offered securities." The offered securities, together with any debt
securities, common stock and preferred stock issuable upon exercise of debt warrants, common stock warrants, warrant shares or conversion or exchange of other offered securities, as applicable, will
be referred to as the "securities."
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You
should rely only on the information contained or incorporated by reference in this prospectus or prospectus supplement. We have not authorized any other person to provide you with
different information. If anyone provides you with different or inconsistent information, you should not rely on it. We are not making an offer to sell these securities in any jurisdiction where the
offer or sale is not permitted. You should assume that the information appearing in this prospectus, prospectus supplement, or any documents incorporated by reference is accurate only as of the date
on the front cover of the applicable document. Our business, financial condition, results of operations and prospects may have changed since then.
PROSPECTUS SUPPLEMENT OR TERM SHEET
This prospectus provides you with a general description of the debt securities, warrants to purchase debt securities, common stock warrants,
warrant shares, common stock and preferred stock we may offer. Each time we sell securities, we will provide a prospectus supplement or term sheet that will contain specific information about the
terms of that offering and whether securities are being offered by us, a selling security holder or both. The prospectus supplement or term sheet to be attached to the front of this prospectus will
describe: the terms of the securities offered, any initial public offering price, the price paid to us for the securities, the net proceeds to us, the manner of distribution and any underwriting
compensation and the other specific material terms related to the offering of these securities. The prospectus supplement or term sheet may also add to, update or change information contained in this
prospectus, and accordingly, to the extent inconsistent, information in this prospectus is superseded by the information in the prospectus supplement or term sheet. You should read both this
prospectus and any prospectus supplement or term sheet together with the additional information described under the heading "Where You Can Find More Information."
For
more detail on the terms of the securities, you should read the exhibits filed with or incorporated by reference in our Registration Statement.
FORWARD-LOOKING STATEMENTS
Certain statements contained in this prospectus, or any accompanying prospectus supplement and the documents incorporated herein or therein by
reference are forward-looking in
nature, such as statements concerning our expectations, beliefs, plans, objectives, goals, strategies, and future events or performance. Such statements are "forward-looking" statements within the
meaning of the Private Securities Litigation Reform Act of 1995 and relate to trends and events that may affect our future financial position and operating results. The terms such as "will," "may,"
"could," "would," "plan," "believe," "expect," "anticipate," "intend," "project," "target," and similar words or expressions, as well as statements in future tense, are intended to identify
forward-looking statements.
Forward-looking
statements should not be read as a guarantee of future performance or results, and will not necessarily be accurate indications of the times at, or by, which such
performance or results will be achieved. Forward-looking statements are based on information available at the time those statements are made and/or management's good faith belief as of that time with
respect to future events and are subject to risks and may differ materially from those expressed in or suggested by the forward-looking statements. Important factors that could cause such differences
include, but are not limited to:
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reduced purchases of our products by General Motors Company (GM), FCA US LLC (FCA), or other customers;
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reduced demand for our customers' products (particularly light trucks and sport utility vehicles (SUVs) produced by GM and FCA);
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our ability to develop and produce new products that reflect market demand;
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lower-than-anticipated market acceptance of new or existing products;
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-
our ability to respond to changes in technology, increased competition or pricing pressures;
-
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our ability to attract new customers and programs for new products;
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our ability to consummate and integrate acquisitions and joint ventures;
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risks inherent in our international operations (including adverse changes in trade agreements, tariffs, immigration policies, political
stability, taxes and other law changes, potential disruptions of production and supply, and currency rate fluctuations, including those resulting from the recent United States presidential election
and the United Kingdom's vote to exit the European Union);
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-
negative or unexpected tax consequences;
-
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liabilities arising from warranty claims, product recall or field actions, product liability and legal proceedings to which we are or may
become a party, or the impact of product recall or field actions on our customers;
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our ability to achieve the level of cost reductions required to sustain global cost competitiveness;
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-
supply shortages or price increases in raw materials, utilities or other operating supplies for us or our customers as a result of natural
disasters or otherwise;
-
-
our ability or our customers' and suppliers' ability to successfully launch new product programs on a timely basis;
-
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our ability to realize the expected revenues from our new and incremental business backlog;
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risks related to a failure of our information technology systems and networks, and risks associated with current and emerging technology
threats and damage from computer viruses, unauthorized access, cyber attack and other similar disruptions;
-
-
global economic conditions;
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-
our ability to maintain satisfactory labor relations and avoid work stoppages;
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our suppliers', our customers' and their suppliers' ability to maintain satisfactory labor relations and avoid work stoppages;
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price volatility in, or reduced availability of, fuel;
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our ability to protect our intellectual property and successfully defend against assertions made against us;
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our ability to attract and retain key associates;
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availability of financing for working capital, capital expenditures, research and development (R&D) or other general corporate purposes
including acquisitions, as well as our ability to comply with financial covenants;
-
-
our customers' and suppliers' availability of financing for working capital, capital expenditures, R&D or other general corporate purposes;
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changes in liabilities arising from pension and other postretirement benefit obligations;
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risks of noncompliance with environmental laws and regulations or risks of environmental issues that could result in unforeseen costs at our
facilities;
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-
adverse changes in laws, government regulations or market conditions affecting our products or our customers' products (such as the Corporate
Average Fuel Economy (CAFE) regulations);
-
-
our ability or our customers' and suppliers' ability to comply with the Dodd-Frank Act and other regulatory requirements and the potential
costs of such compliance; and
-
-
other unanticipated events and conditions that may hinder our ability to compete.
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It is not possible to foresee or identify all such factors and we make no commitment to update any forward-looking statement or to disclose any facts, events or
circumstances after the date hereof that may affect the accuracy of any forward-looking statement.
DESCRIPTION OF DEBT SECURITIES
We may issue debt securities in one or more distinct series. This section summarizes the material terms of the debt securities that are common
to all series. Most of the financial terms and other specific material terms of any series of debt securities that we offer will be described in a prospectus supplement or term sheet to be attached to
the front of this prospectus. Furthermore, since the terms of specific debt securities may differ from the general information we have provided below, you should rely on information in the prospectus
supplement or term sheet that contradicts different information below.
As
required by federal law for all debt securities of companies that are publicly offered, the debt securities are governed by a document called an "indenture." An indenture is a
contract between us and a financial institution acting as trustee on your behalf. Unless otherwise indicated in a prospectus supplement, the trustee will be U.S. Bank National Association. The trustee
has two main roles. First, the trustee can enforce your rights against us if we default. There are some limitations on the extent to which the trustee acts on your behalf, described in the sixth
paragraph under "Events of Default." Second, the trustee performs certain administrative duties for us.
The
term "trustee" refers to the senior trustee or the subordinated trustee, as appropriate. We will refer to the indenture that governs the debt securities, as amended from time to
time, as the "Indenture." The Indenture is subject to and governed by the Trust Indenture Act of 1939, as amended (the "TIA").
The
following summary 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 debt securities and the
Indenture. We urge you to read the Indenture and the form of the debt securities, which you may obtain from us upon request. As used in this description, all references to "AAM Inc.," "our
company," the "issuer," "we," "us" or "our" mean American Axle & Manufacturing, Inc., excluding, unless otherwise expressly stated or the context otherwise requires, its subsidiaries,
including those acting as Subsidiary Guarantors, 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
American Axle & Manufacturing, Inc., the issuer, and Alpha SPV I, Inc. The Subsidiary Guarantors are wholly-owned subsidiaries of American Axle & Manufacturing, Inc,
with the exception of Alpha SPV I, Inc., which is a wholly-owned subsidiary of Holdings.
General
The debt securities will be AAM Inc.'s obligations which may be secured or unsecured. The senior unsecured securities will rank equally
with all of our other unsecured and unsubordinated indebtedness and will be guaranteed by Holdings and/or any Subsidiary Guarantors, if applicable. The Holdings guarantee and any Subsidiary guarantees
will rank equally with all of their other unsecured and unsubordinated indebtedness. Terms of secured debt securities and the related Holdings guarantee and any Subsidiary guarantees will be more
fully described in a prospectus supplement. The subordinated securities will be subordinated in right of payment to the prior payment in full of AAM Inc.'s senior indebtedness as more fully
described in a prospectus supplement or term sheet. The subordinated debt securities will be guaranteed on a subordinated basis by Holdings, and, if applicable, the Subsidiary Guarantors, as more
fully described in a prospectus supplement or term sheet.
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The
Indenture provides that any debt securities proposed to be sold under this prospectus and the attached prospectus supplement or term sheet, including the guarantee by Holdings and
any Subsidiary guarantees ("offered debt securities") and any debt securities issuable upon the exercise of debt warrants or upon conversion or exchange of other offered securities ("underlying debt
securities"), as well as other unsecured debt securities, may be issued under the Indenture in one or more series.
You
should read the prospectus supplement or term sheet for the material terms of the offered debt securities and any underlying debt securities, including the
following:
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The title of the debt securities and whether the debt securities will be senior securities or subordinated securities.
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The total principal amount of the debt securities and any limit on the total principal amount of debt securities of the series.
-
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If not the principal amount of the debt securities, the portion of the principal amount payable upon acceleration of the maturity of the debt
securities or how this portion will be determined.
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The date or dates, or how the date or dates will be determined or extended, when the principal of the debt securities will be payable.
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The interest rate or rates, which may be fixed or variable, that the debt securities will bear, if any, or how the rate or rates will be
determined, the date or dates from which any interest will accrue or how the date or dates will be determined, the interest payment dates, any record dates for these payments and the basis upon which
interest will be calculated if other than that of a 360-day year of twelve 30-day months.
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Any optional redemption provisions.
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Whether debt securities are secured and the terms of such security interests.
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Whether debt securities are not to be guaranteed by Holdings and any modifications to such guarantee.
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Whether debt securities are guaranteed by any Subsidiary Guarantors and any deletions from, modifications to, or additions to such guarantees,
Events of Default or covenants with respect to such guarantees.
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Any sinking fund or other provisions that would obligate us to repurchase or otherwise redeem the debt securities.
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If other than registered debt securities, the form in which we will issue the debt securities; whether we will have the option of issuing debt
securities in "certificated" form; whether we will have the option of issuing certificated debt securities in bearer form if we issue the securities outside the United States to non-U.S. persons; any
restrictions on the offer, sale or delivery of bearer securities and the terms, if any, upon which bearer securities of the series may be exchanged for registered securities of the series and vice
versa (if permitted by applicable laws and regulations).
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If other than U.S. dollars, the currency or currencies in which the debt securities are denominated and/or payable.
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Whether the amount of payments of principal, premium or interest, if any, on the debt securities will be determined with reference to an index,
formula or other method (which could be based on one or more currencies, commodities, equity indices or other indices) and how these amounts will be determined.
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The place or places, if any, other than or in addition to The City of New York, of payment, transfer, conversion and/or exchange of the debt
securities.
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If other than denominations of $2,000 or any integral multiple of $1,000 thereafter in the case of registered securities issued in certificated
form and $5,000 in the case of bearer securities, the denominations in which the offered debt securities will be issued.
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The applicability of the provisions of the Indenture under "Defeasance" and any provisions in modification of, in addition to or in lieu of any
of these provisions.
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Whether and under what circumstances we will pay additional amounts in respect of any tax, assessment or governmental charge and, if so,
whether we will have the option to redeem the debt securities rather than pay the additional amounts (and the terms of this option).
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Whether the securities are subordinated and the terms of such subordination.
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Any provisions granting special rights to the holders of the debt securities upon the occurrence of specified events.
-
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Any changes or additions to the Events of Default or covenants contained in the Indenture.
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Whether the debt securities will be convertible into or exchangeable for any other securities and the applicable terms and conditions.
-
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Any other material terms of the debt securities and guarantees.
For
purposes of this prospectus, any reference to the payment of principal or premium or interest, if any, on the debt securities will include additional amounts if required by the terms
of the debt securities.
The
Indenture does not limit the amount of debt securities that may be issued thereunder from time to time. Debt securities issued under the Indenture, when a single trustee is acting
for all debt securities issued under the Indenture, are called the "indenture securities." The Indenture also provides that there may be more than one trustee thereunder, each with respect to one or
more different series of indenture securities. See "Resignation of Trustee" below. At a time when two or more trustees are acting under the Indenture, each with respect to only certain series, the
term "indenture securities"
means the one or more series of debt securities with respect to which each respective trustee is acting. In the event that there is more than one trustee under the Indenture, the powers and trust
obligations of each trustee described in this prospectus will extend only to the one or more series of indenture securities for which it is trustee. If two or more trustees are acting under the
Indenture, then the indenture securities for which each trustee is acting would be treated as if issued under separate indentures.
The
Indenture does not contain any provisions that give you protection in the event we issue a large amount of debt or we are acquired by another entity.
We
refer you to the prospectus supplement or term sheet for information with respect to any deletions from, modifications of or additions to the Events of Default or our covenants that
are described below, including any addition of a covenant or other provision providing event risk or similar protection.
We
have the ability to issue indenture securities with terms different from those of indenture securities previously issued and, without the consent of the holders thereof, to reopen a
previous issue of a series of indenture securities and issue additional indenture securities of that series unless the reopening was restricted when that series was created.
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Unless
otherwise specified in the applicable prospectus supplement or term sheet, the debt securities will be denominated in U.S. dollars and all payments on the debt securities will be
made in U.S. dollars.
Payment
of the purchase price of the debt securities must be made in immediately available funds.
As
used in this prospectus, "Business Day" means any day, other than a Saturday or Sunday, that is neither a legal holiday nor a day on which commercial banks are authorized or required
by law, regulation or executive order to close in The City of New York;
provided
,
however
, that, with
respect to foreign currency debt securities, the day is also not a day on which commercial banks are authorized or required by law, regulation or executive order to close in the Principal Financial
Center (as defined below) of the country issuing the specified currency (or, if the specified currency is the euro, the day is also a day on which the Trans-European Automated Real Time Gross
Settlement Express Transfer ("TARGET") System is operating, which we refer to as a "TARGET Business Day"); and
provided further
that, with respect to
debt securities as to which LIBOR is an applicable interest rate basis, the day is also a London Business Day.
"London
Business Day" means a day on which commercial banks are open for business (including dealings in the designated LIBOR Currency) in London.
"Principal Financial Center"
means (i) the capital city of the country issuing the specified currency or (ii) the capital
city of the country to which the designated LIBOR Currency relates, as applicable, except that the term "Principal Financial Center" means the following cities in the case of the following currencies:
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Currency
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Principal Financial Center
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U.S. dollars
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The City of New York
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Australian dollars
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Sydney
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Canadian dollars
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Toronto
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New Zealand dollars
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Auckland
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South African rand
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Johannesburg
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Swiss francs
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Zurich
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and
in the event the LIBOR Currency is the euro, the "Principal Financial Center" is London.
The
authorized denominations of debt securities denominated in U.S. dollars will be $2,000 and integral multiples of $1,000 thereafter. The authorized denominations of foreign currency
debt securities will be set forth in the applicable prospectus supplement or term sheet.
Optional Redemption, Repayment and Repurchase
If specified in a prospectus supplement or term sheet, we may redeem the debt securities at our option, in whole at any time or in part from
time to time, at a redemption price as set forth in the applicable prospectus supplement or term sheet.
We
will mail notice of any redemption at least 30 days, but not more than 60 days, before the date of redemption to each holder of the debt securities to be redeemed. If
less than all of the debt securities are to be redeemed at any time, the trustee will select debt securities 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 debt securities or portions thereof called for redemption.
Regardless
of anything in this prospectus to the contrary, if a debt security is an OID Note (as defined below) (other than an Indexed Note), the amount payable in the event of
redemption or repayment prior to its stated maturity will be the amortized face amount on the redemption or
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repayment
date, as the case may be. The amortized face amount of an OID Note will be equal to (i) the issue price specified in the applicable prospectus supplement or term sheet plus
(ii) that portion of the difference between the issue price and the principal amount of the OID Note that has accrued at the yield to maturity described in the prospectus supplement or term
sheet (computed in accordance with generally accepted U.S. bond yield computation principles) by the redemption or repayment date. However, in no case will the amortized face amount of an OID Note
exceed its principal amount.
We
may at any time purchase debt securities at any price in the open market or otherwise. We may hold, resell or surrender for cancellation any debt securities that we purchase.
Conversion and Exchange
If any debt securities are convertible into or exchangeable for other securities, the prospectus supplement or term sheet will explain the terms
and conditions of the conversion or exchange, including the conversion price or exchange ratio (or the calculation method), the conversion or exchange period (or how the period will be determined), if
conversion or exchange will be mandatory or at the option of the holder or us, provisions for adjusting the conversion price or the exchange ratio and provisions affecting conversion or exchange in
the event of the redemption of the underlying debt securities. These terms may also include provisions under which the number or amount of other securities to be received by the holders of the debt
securities upon conversion or exchange would be calculated according to the market price of the other securities as of a time stated in the prospectus supplement or term sheet.
Issuance of Securities in Registered Form
We may issue the debt securities in registered form, in which case we will issue them in book-entry form only. Debt securities issued in
book-entry form will be represented by global securities. We also will have the option of issuing debt securities in non-registered form as bearer securities if we issue the securities outside the
United States to non-U.S. persons. In that case, the prospectus supplement or term sheet will set forth the mechanics for holding the bearer securities, including the procedures for receiving
payments, for exchanging the bearer securities for registered securities of the same series, and for receiving notices. The prospectus supplement or term sheet will also describe the requirements with
respect to our maintenance of offices or agencies outside the United States and the applicable U.S. federal tax law requirements.
Book-Entry Holders.
We will issue registered debt securities in book-entry form only, unless we specify otherwise in the applicable
prospectus
supplement or term sheet. This means debt securities will be represented by one or more global securities registered in the name of a depositary that will hold them on behalf of financial institutions
that participate in the depositary's book-entry system. These participating institutions, in turn, hold beneficial interests in the debt securities held by the depositary or its nominee. These
institutions may hold these interests on behalf of themselves or customers.
Under
the Indenture, only the person in whose name a debt security is registered is recognized as the holder of that debt security. Consequently, for debt securities issued in book-entry
form, we will recognize only the depositary as the holder of the debt securities and we will make all payments on the debt securities to the depositary. The depositary will then pass along the
payments it receives to its participants, which, in turn, will pass the payments along to their customers who are the beneficial owners. The depositary and its participants do so under agreements they
have made with one another or with their customers; they are not obligated to do so under the terms of the debt securities.
As
a result, investors will not own debt securities directly. Instead, they will own beneficial interests in a global security, through a bank, broker or other financial institution that
participates in the depositary's book-entry system or holds an interest through a participant. As long as the debt securities
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are
represented by one or more global securities, investors will be indirect holders, and not holders of the debt securities.
Street Name Holders.
In the future, we may issue debt securities in certificated form or terminate a global security. In these cases,
investors may
choose to hold their debt securities in their own names or in "street name." Debt securities held in street name are registered in the name of a bank, broker or other financial institution chosen by
the investor, and the investor would hold a beneficial interest in those debt securities through the account he or she maintains at that institution.
For
debt securities held in street name, we will recognize only the intermediary banks, brokers and other financial institutions in whose names the debt securities are registered as the
holders of those debt securities and we will make all payments on those debt securities to them. These institutions will pass along the payments they receive to their customers who are the beneficial
owners, but only because they agree to do so in their customer agreements or because they are legally required to do so. Investors who hold debt securities in street name will be indirect holders, and
not holders, of the debt securities.
Legal Holders.
Our obligations, as well as the obligations of the applicable trustee and those of any third parties employed by us or
the applicable
trustee, run only to the legal holders of the debt securities. We do not have obligations to investors who hold beneficial interests in global securities, in street name or by any other indirect
means. This will be the case whether an investor chooses to be an indirect holder of a debt security or has no choice because we are issuing the debt securities only in book-entry form.
For
example, once we make a payment or give a notice to the holder, we have no further responsibility for the payment or notice even if that holder is required, under agreements with
depositary participants or customers or by law, to pass it along to the indirect holders but does not do so. Similarly, if we want to obtain the approval of the holders for any purpose (for example,
to amend the Indenture or to relieve us of the consequences of a default or of our obligation to comply with a particular provision of the Indenture), we would seek the approval only from the holders,
and not the indirect holders, of the debt securities. Whether and how the holders contact the indirect holders is up to the holders.
When
we refer to you, we mean those who invest in the debt securities being offered by this prospectus, the prospectus supplement or term sheet whether they are the holders or only
indirect
holders of those debt securities. When we refer to your debt securities, we mean the debt securities in which you hold a direct or indirect interest.
Special Considerations for Indirect Holders.
If you hold debt securities through a bank, broker or other financial institution, either
in book-entry
form or in street name, we urge you to check with that institution to find out:
-
-
how it handles securities payments and notices,
-
-
whether it imposes fees or charges,
-
-
how it would handle a request for the holders' consent, if ever required,
-
-
whether and how you can instruct it to send you debt securities registered in your own name so you can be a holder, if that is permitted in the
future for a particular series of debt securities,
-
-
how it would exercise rights under the debt securities if there were a default or other event triggering the need for holders to act to protect
their interests, and
-
-
if the debt securities are in book-entry form, how the depositary's rules and procedures will affect these matters.
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Interest and Interest Rates
Each debt security will begin to accrue interest from the date it is originally issued. The related prospectus supplement or term sheet will
specify each debt security as a "Fixed Rate Note," a "Floating Rate Note," an "Amortizing Note" or an "Indexed Note" and describe the method of determining the interest rate, including any spread
and/or spread multiplier. For an Indexed Note, the related prospectus supplement or term sheet also will describe the method for the calculation
and payment of principal and interest. The prospectus supplement or term sheet for a Floating Rate Note or Indexed Note may also specify a maximum and a minimum interest rate.
A
debt security may be issued as a Fixed Rate Note or a Floating Rate Note or as a Note that combines fixed and floating rate terms.
Interest
rates offered with respect to debt securities may differ depending upon, among other things, the aggregate principal amount of debt securities purchased in any single
transaction. Debt securities with similar variable terms but different interest rates, as well as debt securities with different variable terms, may be offered concurrently to different investors.
Interest rates or formulas and other terms of debt securities are subject to change from time to time, but no such change will affect any debt security already issued or as to which an offer to
purchase has been accepted.
Interest
on the debt securities denominated in U.S. dollars will be paid by check mailed on an Interest Payment Date (as defined below) other than a Maturity Date (as defined below) to
the persons entitled thereto to the addresses of such holders as they appear in the security register or, at our option, by wire transfer to a bank account maintained by the holder. The principal of,
premium, if any, and interest on debt securities denominated in U.S. dollars, together with interest accrued and unpaid thereon, due on the Maturity Date will be paid in immediately available funds
upon surrender of such debt securities at the corporate trust office of the trustee in The City of New York, or, at our option, by wire transfer of immediately available funds to an account with a
bank designated at least 15 calendar days prior to the Maturity Date by the applicable registered holder, provided the particular bank has appropriate facilities to receive these payments and
the particular debt security is presented and surrendered at the office or agency maintained by us for this purpose in the Borough of Manhattan, The City of New York, in time for the trustee to make
these payments in accordance with its normal procedures.
The prospectus supplement or term sheet for Fixed Rate Notes will describe a fixed interest rate payable semiannually in arrears on the dates
specified in such term sheet or prospectus supplement (each, with respect to Fixed Rate Notes, an "Interest Payment Date"). Interest on Fixed Rate Notes will be computed on the basis of a 360-day year
of twelve 30-day months. If the stated maturity date, any redemption date or any repayment date (together referred to as the "Maturity Date") or an Interest Payment Date for any Fixed Rate Note is not
a Business Day, principal of, premium, if any, and interest on that Note will be paid on the next Business Day, and no interest will accrue from and after the Maturity Date or Interest Payment Date.
Interest on Fixed Rate Notes will be paid to holders of record as of each Regular Record Date. A "Regular Record Date" will be the fifteenth day (whether or not a Business Day) next preceding the
applicable Interest Payment Date.
Each
interest payment on a Fixed Rate Note will include interest accrued from, and including, the issue date or the last Interest Payment Date, as the case may be, to but excluding the
applicable Interest Payment Date or the Maturity Date, as the case may be.
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We may issue original issue discount debt securities (including zero coupon debt securities) ("OID Notes"), which are debt securities issued at
a discount from the principal amount payable on the Maturity Date. There may not be any periodic interest payments on OID Notes. For OID Notes, interest normally accrues during the life of the OID
Note and is paid on the Maturity Date. Upon a redemption, repayment or acceleration of the maturity of an OID Note, the amount payable will be determined as set forth under "Optional
Redemption, Repayment and Repurchase." This amount normally is less than the amount payable on the stated maturity date.
We may issue amortizing debt securities, which are Fixed Rate Notes for which combined principal and interest payments are made in installments
over the life of each debt securities ("Amortizing Notes"). Payments on Amortizing Notes are applied first to interest due and then to the reduction of the unpaid principal amount. The related
prospectus supplement or term sheet for an Amortizing Note will include a table setting forth repayment information.
Each Floating Rate Note will have an interest rate basis or formula. That basis or formula may be based
on:
-
-
the CD Rate;
-
-
the Commercial Paper Rate;
-
-
LIBOR;
-
-
EURIBOR;
-
-
the Federal Funds Rate;
-
-
the Prime Rate;
-
-
the Treasury Rate;
-
-
the CMT Rate;
-
-
the Eleventh District Cost of Funds Rate; or
-
-
another negotiated interest rate basis or formula.
The
prospectus supplement or term sheet will also indicate any spread and/or spread multiplier, which would be applied to the interest rate formula to determine the interest rate. Any
Floating Rate Note may have a maximum or minimum interest rate limitation. In addition to any maximum interest rate limitation, the interest rate on the Floating Rate Notes will in no event be higher
than the maximum rate permitted by New York law, as the same may be modified by United States law for general application.
We
will appoint a calculation agent to calculate interest rates on the Floating Rate Notes. Unless we identify a different party in the prospectus supplement or term sheet, the paying
agent will be the calculation agent for each Note.
Unless
otherwise specified in a prospectus supplement or term sheet, the "Calculation Date," if applicable, relating to an Interest Determination Date (as described below under
"Date Interest Rate is Determined") will be the earlier of (i) the tenth calendar day after such Interest Determination Date or, if such day is not a Business Day, the next
succeeding Business Day, or (ii) the Business Day immediately preceding the relevant Interest Payment Date or the Maturity Date, as the case may be.
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Upon
the request of the beneficial holder of any Floating Rate Note, the calculation agent will provide the interest rate then in effect and, if different, when available, the interest
rate that will become effective on the next Interest Reset Date for the Floating Rate Note.
Change of Interest Rate.
The interest rate on each Floating Rate Note may be reset daily, weekly, monthly, quarterly, semiannually,
annually or on
some other specified basis (each, an "Interest Reset Date"). The Interest Reset Date will be:
-
-
for Notes with interest that resets daily, each Business Day;
-
-
for Notes (other than Treasury Rate Notes) with interest that resets weekly, Wednesday of each week;
-
-
for Treasury Rate Notes with interest that resets weekly, Tuesday of each week;
-
-
for Notes with interest that resets monthly, the third Wednesday of each month;
-
-
for Notes with interest that resets quarterly, the third Wednesday of March, June, September and December of each year;
-
-
for Notes with interest that resets semiannually, the third Wednesday of each of the two months of each year indicated in the applicable
prospectus supplement or term sheet; and
-
-
for Notes with interest that resets annually, the third Wednesday of the month of each year indicated in the applicable prospectus supplement
or term sheet.
The
related prospectus supplement or term sheet will describe the initial interest rate or interest rate formula on each Note. That rate is effective until the following Interest Reset
Date. Thereafter, the interest rate will be the rate determined on each Interest Determination Date. Each time a new interest rate is determined, it becomes effective on the following Interest Reset
Date. If any Interest Reset Date is not a Business Day, then the Interest Reset Date is postponed to the next Business Day, except, in the case of LIBOR and EURIBOR Notes, if the next Business Day is
in the next calendar month, the Interest Reset Date is the immediately preceding Business Day.
Date Interest Rate Is Determined.
The Interest Determination Date for all CD and CMT Rate Notes is the second Business Day before the
Interest Reset
Date and for all LIBOR Notes will be the second London Business Day immediately preceding the applicable Interest Reset Date (unless the LIBOR Currency is Sterling, in which case the Interest
Determination Date will be the Interest Reset Date).
The
Interest Determination Date for Treasury Rate Notes will be the day of the week in which the Interest Reset Date falls on which Treasury bills of the Index Maturity are normally
auctioned. Treasury bills are usually sold at auction on Monday of each week, unless that day is a legal holiday, in which case the auction is usually held on Tuesday. Sometimes, the auction is held
on the preceding Friday. If an auction is held on the preceding Friday, that day will be the Interest Determination Date relating to the Interest Reset Date occurring in the next week.
The
Interest Determination Date for all Commercial Paper, Federal Funds and Prime Rate Notes will be the first Business Day preceding the Interest Reset Date.
The
Interest Determination Date for EURIBOR Notes will be the second TARGET Business Day immediately preceding the applicable Interest Reset Date.
The
Interest Determination Date for an Eleventh District Cost of Funds Rate Note is the last Business Day of the month immediately preceding the applicable Interest Reset Date in which
the Federal Home Loan Bank of San Francisco published the applicable rate.
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The
Interest Determination Date relating to a Floating Rate Note with an interest rate that is determined by reference to two or more interest rate bases will be the most recent Business
Day which is at least two Business Days before the applicable Interest Reset Date for each interest rate for the applicable Floating Rate Note on which each interest rate basis is determinable.
Payment of Interest.
Interest is paid as follows:
-
-
for Notes with interest that resets daily, weekly or monthly, on the third Wednesday of each month;
-
-
for Notes with interest payable quarterly, on the third Wednesday of March, June, September, and December of each year;
-
-
for Notes with interest payable semiannually, on the third Wednesday of each of the two months specified in the applicable prospectus
supplement or term sheet;
-
-
for Notes with interest payable annually, on the third Wednesday of the month specified in the applicable prospectus supplement or term sheet
(each of the above, with respect to Floating Rate Notes, an "Interest Payment Date"); and
-
-
at maturity, redemption or repayment.
Each
interest payment on a Floating Rate Note will include interest accrued from, and including, the issue date or the last Interest Payment Date, as the case may be, to but excluding
the applicable Interest Payment Date or the Maturity Date, as the case may be.
Interest
on a Floating Rate Note will be payable beginning on the first Interest Payment Date after its issue date to holders of record at the close of business on each Regular Record
Date, which is the fifteenth day (whether or not a Business Day) next preceding the applicable Interest Payment Date, unless the issue date falls after a Regular Record Date and on or prior to the
related Interest Payment Date, in which case payment will be made to holders of record at the close of business on the Regular Record Date next preceding the second Interest Payment Date following the
issue date. If an Interest Payment Date (but not the Maturity Date) is not a Business Day, then the Interest Payment Date will be postponed to the next Business Day, except in the case of LIBOR and
EURIBOR Notes, if the next Business Day is in the next calendar month, the Interest Payment Date will be the immediately preceding Business Day. If the Maturity Date of any Floating Rate Note is not a
Business Day, principal of, premium, if any, and interest on that Note will be paid on the next Business Day, and no interest will accrue from and after the Maturity Date.
Accrued
interest on a Floating Rate Note is calculated by multiplying the principal amount of a Note by an accrued interest factor. The accrued interest factor is the sum of the interest
factors calculated for each day in the period for which accrued interest is being calculated. The interest factor for each day is computed by dividing the interest rate in effect on that day by
(1) the actual number of days in the year, in the case of Treasury Rate Notes or CMT Rate Notes, or (2) 360, in the case of other Floating Rate Notes. The interest factor for Floating
Rate Notes for which the interest rate is calculated with reference to two or more interest rate bases will be calculated in each period in the same manner as if only one of the applicable interest
rate bases applied. All percentages resulting from any calculation are rounded to the nearest one hundred-thousandth of a percentage point, with five one-millionths of a percentage point rounded
upward. For example, 9.876545% (or .09876545) will be rounded to 9.87655% (or .0987655). Dollar amounts used in the calculation are rounded to the nearest cent (with one-half cent being rounded
upward).
CD Rate Notes.
The "CD Rate" for any Interest Determination Date is the rate on that date for negotiable U.S. dollar certificates of
deposit having
the Index Maturity described in the related prospectus supplement or term sheet, as published in H.15(519) prior to 3:00 P.M., New York City time, on the Calculation Date, for that
Interest Determination Date under the heading "CDs
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(secondary
market)." The "Index Maturity" is the period to maturity of the instrument or obligation with respect to which the related interest rate basis or formula will be calculated.
The
following procedures will be followed if the CD Rate cannot be determined as described above:
-
-
If the above rate is not published in H.15(519) by 3:00 P.M., New York City time, on the Calculation Date, the CD Rate will be
the rate on that Interest Determination Date for negotiable United States dollar certificates of deposit of the Index Maturity described in the prospectus supplement or term sheet as published in H.15
Daily Update, or such other recognized electronic source used for the purpose of displaying such rate, under the caption "CDs (secondary market)."
-
-
If that rate is not published in H.15(519), H.15 Daily Update or another recognized electronic source by 3:00 P.M., New York City time,
on the Calculation Date, then the calculation agent will determine the CD Rate to be the average of the secondary market offered rates as of 10:00 A.M., New York City time, on that Interest
Determination Date, quoted by three leading nonbank dealers of negotiable U.S. dollar certificates of deposit in New York City (which may include an agent or its affiliates) for negotiable U.S. dollar
certificates of deposit of major United States money-center banks with a remaining maturity closest to the Index Maturity in an amount that is representative for a single transaction in the market at
that time described in the prospectus supplement or term sheet. The calculation agent will select the three dealers referred to above.
-
-
If fewer than three dealers are quoting as mentioned above, the CD Rate will remain the CD Rate then in effect on that Interest Determination
Date.
"H.15(519)"
means the weekly statistical release designated as such, or any successor publication, published by the Board of Governors of
the Federal Reserve System.
"H.15 Daily Update"
means the daily update of H.15(519), available through the web site of the Board of Governors of the Federal Reserve
System at http://www.federalreserve.gov/releases/h15/update, or any successor site or publication.
Commercial Paper Rate Notes.
The
"Commercial Paper Rate" for any Interest Determination
Date is the
Money Market Yield of the rate on that date for commercial paper having the Index Maturity described in the related prospectus supplement or term sheet, as published in H.15(519) prior to 3:00
PM., New York City time, on the Calculation Date for that Interest Determination Date under the heading "Commercial PaperNonfinancial."
The
following procedures will be followed if the Commercial Paper Rate cannot be determined as described above:
-
-
If the above rate is not published in H.15(519) by 3:00 P.M., New York City time, on the Calculation Date, the Commercial Paper
Rate will be the Money Market Yield of the rate on that Interest Determination Date for commercial paper having the Index Maturity described in the prospectus supplement or term sheet, as published in
H.15 Daily Update, or such other recognized electronic source used for the purpose of displaying such rate, under the caption "Commercial PaperNonfinancial."
-
-
If that rate is not published in H.15(519), H.15 Daily Update or another recognized electronic source by 3:00 PM., New York City time, on the
Calculation Date, then the calculation agent will determine the Commercial Paper Rate to be the Money Market Yield of the average of the offered rates of three leading dealers of U.S. dollar
commercial paper in New York City (which may include an agent or its affiliates) as of 11:00 A.M., New York City time, on that Interest Determination Date for commercial paper having the Index
Maturity described in the prospectus
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supplement
or term sheet placed for an industrial issuer whose bond rating is "Aa," or the equivalent, from a nationally recognized statistical rating organization. The calculation agent will select
the three dealers referred to above.
-
-
If fewer than three dealers selected by the calculation agent are quoting as mentioned above, the Commercial Paper Rate will remain the
Commercial Paper Rate then in effect on that Interest Determination Date.
"Money Market Yield"
means a yield (expressed as a percentage) calculated in accordance with the following formula:
|
|
|
|
|
|
|
Money Market Yield
|
|
=
|
|
D×360
360(D×M)
|
|
×100
|
where
"D" refers to the applicable per annum rate for commercial paper quoted on a bank discount basis and expressed as a decimal, and "M" refers to the actual number of days in the reset period for
which interest is being calculated.
LIBOR Notes.
The "LIBOR" for any Interest Determination Date is the rate for deposits in the LIBOR
Currency having the Index Maturity specified in such pricing supplement or term sheet as such rate is displayed on Reuters (or any successor service) on page LIBOR01 (or any other page as may replace
such page on such service for the purpose of displaying the London interbank rates of major banks for the designated LIBOR Currency) ("Reuters Page LIBOR01") as of 11:00 A.M., London time, on
such LIBOR Interest Determination Date.
The
following procedure will be followed if LIBOR cannot be determined as described above:
-
-
The calculation agent shall request the principal London offices of each of four major reference banks (which may include affiliates of the
agents) in the London interbank market, as selected by the calculation agent to provide the calculation agent with its offered quotation for deposits in the designated LIBOR Currency for the period of
the Index Maturity specified in the applicable pricing supplement or term sheet, commencing on the related Interest Reset Date, to prime banks in the London interbank market at approximately
11:00 a.m., London time, on such LIBOR Interest Determination Date and in a principal amount that is representative for a single transaction in the designated LIBOR Currency in such market at
such time. If at least two such quotations are so provided, then LIBOR on such LIBOR Interest Determination Date will be the arithmetic mean calculated by the calculation agent of such quotations. If
fewer than two such quotations are so provided, then LIBOR on such LIBOR Interest Determination Date will be the arithmetic mean calculated by the calculation agent of the rates quoted at
approximately 11:00 a.m., in the applicable Principal Financial Center (as described above), on such LIBOR Interest Determination Date by three major banks (which may include affiliates of the
agents) in such Principal Financial Center selected by the calculation agent for loans in the designated LIBOR Currency to leading European banks, having the Index Maturity specified in the applicable
pricing supplement or term sheet and in a principal amount that is representative for a single transaction in the designated LIBOR Currency in such market at such time;
provided
,
however
, that if the banks so selected by the calculation agent are not quoting as mentioned
in this sentence, LIBOR determined as of such LIBOR Interest Determination Date shall be LIBOR in effect on such LIBOR Interest Determination Date.
"LIBOR Currency"
means the currency specified in the applicable prospectus supplement or term sheet as to which LIBOR shall be calculated
or, if no such currency is specified in the applicable prospectus supplement or term sheet, U.S. dollars.
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EURIBOR Notes.
The "EURIBOR" for any Interest Determination Date is the offered rate for deposits in euro having the Index Maturity
specified in the
applicable pricing supplement or term sheet, beginning on the second TARGET Business Day after such EURIBOR Interest Determination Date, as that rate appears on Reuters Page EURIBOR 01 as of
11:00 A.M., Brussels time, on such EURIBOR Interest Determination Date.
The
following procedure will be followed if EURIBOR cannot be determined as described above:
-
-
EURIBOR will be determined on the basis of the rates, at approximately 11:00 A.M., Brussels time, on such EURIBOR Interest Determination
Date, at which deposits of the following kind are offered to prime banks in the euro-zone interbank market by the principal euro-zone office of each of four major banks in that market selected by the
calculation agent: euro deposits having such EURIBOR Index Maturity, beginning on such EURIBOR Interest Reset Date, and in a representative amount. The calculation agent will request that the
principal euro-zone office of each of these banks provide a quotation of its rate. If at least two quotations are provided, EURIBOR for such EURIBOR Interest Determination Date will be the arithmetic
mean of the quotations.
-
-
If fewer than two quotations are provided as described above, EURIBOR for such EURIBOR Interest Determination Date will be the arithmetic mean
of the rates for loans of the following kind to leading euro-zone banks quoted, at approximately 11:00 A.M., Brussels time on that Interest Determination Date, by three major banks in the
euro-zone selected by the calculation agent: loans of euro having such EURIBOR Index Maturity, beginning on such EURIBOR Interest Reset Date, and in an amount that is representative of a single
transaction in euro in that market at the time.
-
-
If fewer than three banks selected by the calculation agent are quoting as described above, EURIBOR for the new interest period will be EURIBOR
in effect for the prior interest period. If the initial base rate has been in effect for the prior interest period, however, it will remain in effect for the new interest period.
Federal Funds Rate Notes.
The "Federal Funds Rate" will be calculated by reference to either the "Federal Funds (Effective) Rate", the
"Federal Funds
Open Rate" or the "Federal Funds Target Rate", as specified in the applicable pricing supplement or term sheet. The Federal Funds Rate is the rate
determined by the calculation agent, with respect to any Interest Determination Date relating to a Floating Rate Note for which the interest rate is determined with reference to the Federal Funds Rate
(a "Federal Funds Rate Interest Determination Date"), in accordance with the following provisions:
-
-
If Federal Funds (Effective) Rate is the specified Federal Funds Rate in the applicable pricing supplement or term sheet, the Federal Funds
Rate as of the applicable Federal Funds Rate Interest Determination Date shall be the rate with respect to such date for United States dollar federal funds as published in H.15(519) opposite
the caption "Federal funds (effective)," as such rate is displayed on Reuters on page FEDFUNDS1 (or any other page as may replace such page on such service) ("Reuters Page FEDFUNDS1") under the
heading "EFFECT," or, if such rate is not so published by 3:00 P.M., New York City time, on the calculation date, the rate with respect to such Federal Funds Rate Interest Determination Date
for United States dollar federal funds as published in H.15 Daily Update, or such other recognized electronic source used for the purpose of displaying such rate, under the caption "Federal funds
(effective)."
-
-
The following procedure will be followed if "Federal Funds (Effective) Rate" is the specified Federal Funds Rate in the applicable
pricing supplement or term sheet and such Federal Funds Rate cannot be determined as described above. The Federal Funds Rate with respect to such Federal Funds Rate Interest Determination Date shall
be calculated by the calculation agent and will be the arithmetic mean of the rates for the last transaction in
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overnight
United States dollar federal funds arranged by three leading brokers of U.S. dollar federal funds transactions in New York City (which may include the agents or their affiliates) selected by
the calculation agent, prior to 9:00 A.M., New York City time, on the Business Day following such Federal Funds Rate Interest Determination Date;
provided
,
however
, that if the brokers so selected by the calculation agent are not quoting as mentioned
in this sentence, the Federal Funds Rate determined as of such Federal Funds Rate Interest Determination Date will be the Federal Funds Rate in effect on such Federal Funds Rate Interest Determination
Date.
-
-
If Federal Funds Open Rate is the specified Federal Funds Rate in the applicable pricing supplement or term sheet, the Federal Funds Rate as of
the applicable Federal Funds Rate Interest Determination Date shall be the rate on such date under the heading "Federal Funds" for the relevant Index Maturity and opposite the caption "Open" as such
rate is displayed on Reuters on page 5 (or any other page as may replace such page on such service) ("Reuters Page 5"), or, if such rate does not appear on Reuters Page 5 by
3:00 P.M., New York City time, on the calculation date, the Federal Funds Rate for the Federal Funds Rate Interest Determination Date will be the rate for that day displayed on FFPREBON Index
page on Bloomberg L.P. ("Bloomberg"), which is the Fed Funds Opening Rate as reported by Prebon Yamane (or a successor) on Bloomberg.
-
-
The following procedure will be followed if "Federal Funds Open Rate" is the specified Federal Funds Rate in the applicable
pricing supplement or term sheet and such Federal Funds Rate cannot be determined as described above. The Federal Funds Rate on such Federal Funds Rate Interest Determination Date shall be calculated
by the calculation agent and will be the arithmetic mean of the rates for the last transaction in overnight United States dollar federal funds arranged by three leading brokers of United States dollar
federal funds transactions in New York City (which may include the agents or their affiliates) selected by the calculation agent prior to 9:00 A.M., New York City time, on such Federal Funds
Rate Interest Determination Date;
provided
,
however
, that if the brokers so selected by the calculation
agent are not quoting as mentioned in this sentence, the Federal Funds Rate determined as of such Federal Funds Rate Interest Determination Date will be the Federal Funds Rate in effect on such
Federal Funds Rate Interest Determination Date.
-
-
If Federal Funds Target Rate is the specified Federal Funds Rate in the applicable pricing supplement or term sheet, the Federal Funds Rate as
of the applicable Federal Funds Rate Interest Determination Date shall be the rate on such date as displayed on the FDTR Index page on Bloomberg. If such rate does not appear on the FDTR Index page on
Bloomberg by 3:00 P.M., New York City time, on the calculation date, the Federal Funds Rate for such Federal Funds Rate Interest Determination Date will be the rate for that day appearing on
Reuters Page USFFTARGET= (or any other page as may replace such page on such service) ("Reuters Page USFFTARGET=").
-
-
The following procedure will be followed if "Federal Funds Target Rate" is the specified Federal Funds Rate in the applicable
pricing supplement or term sheet and such Federal Funds Rate cannot be determined as described above. The Federal Funds Rate on such Federal Funds Rate Interest Determination Date shall be calculated
by the calculation agent and will be the arithmetic mean of the rates for the last transaction in overnight United States dollar federal funds arranged by three leading brokers of United States dollar
federal funds transactions in New York City (which may include the agents or their affiliates) selected by the calculation agent prior to 9:00 A.M., New York City time, on such Federal Funds
Rate Interest Determination Date.
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Prime Rate Notes.
The "Prime Rate" for any Interest Determination Date is the rate on that date, as published in H.15(519) by
3:00 P.M., New York City time, on the Calculation Date for that Interest Determination Date under the heading "Bank Prime Loan" or, if not published by 3:00 P.M., New York City time, on
the related Calculation Date, the rate on such Interest Determination Date as published in H.15 Daily Update, or such other recognized electronic source used for the purpose of displaying such rate,
under the caption "Bank Prime Loan."
The
following procedures will be followed if the Prime Rate cannot be determined as described above:
-
-
If the rate is not published in H.15(519), H.15 Daily Update or another recognized electronic source by 3:00 PM., New York City time, on the
Calculation Date, then the calculation agent will determine the Prime Rate to be the average of the rates of interest publicly announced by each bank that appears on the Reuters Screen designated as
"US PRIME 1 Page" as that bank's prime rate or base lending rate in effect as of 11:00 A.M., New York City time on that Interest Determination Date.
-
-
If fewer than four rates appear on the Reuters Page US PRIME 1 on the Interest Determination Date, then the Prime Rate will be the
average of the prime rates or base lending rates quoted (on the basis of the actual number of days in the year divided by a 360-day year) as of the close of business on the Interest Determination Date
by three major banks, which may include an agent or its affiliates, in the City of New York selected by the calculation agent.
-
-
If the banks selected by the calculation agent are not quoting as mentioned above, the Prime Rate will remain the Prime Rate then in effect on
the Interest Determination Date.
"Reuters Page US PRIME 1"
means the display on Reuters (or any successor service) on the "US PRIME 1 Page" (or such other page as
may replace the US PRIME 1 Page on such service) for the purpose of displaying prime rates or base lending rates of major United States banks.
Treasury Rate Notes.
The "Treasury Rate" for any Interest Determination Date is the rate from the auction of direct obligations of the
United States
("Treasury bills") having the Index Maturity specified in such pricing supplement or term sheet under the caption "INVEST RATE" on the display on Reuters page USAUCTION10 (or any other page as may
replace such page on such service) or page USAUCTION11 (or any other page as may replace such page on such service) or, if not so published at 3:00 P.M., New York City time, on the related
calculation date, the bond equivalent yield (as defined below) of the rate for such treasury bills as published in H.15 Daily Update, or such other recognized electronic source used for the purpose of
displaying such rate, under the caption "U.S. Government Securities/Treasury Bills/Auction High." If such rate is not so published in the related H.15 Daily Update or another recognized source by
3:00 P.M., New York City time, on the related calculation date, the Treasury Rate on such Treasury Rate Interest Determination Date shall be the bond equivalent yield of the auction rate of
such Treasury bills as announced by the United States Department of the Treasury. In the event that such auction rate is not so announced by the United States Department of the Treasury on such
calculation date, or if no such auction is held, then the Treasury Rate on such Treasury Rate Interest Determination Date shall be the bond equivalent yield of the rate on such Treasury Rate Interest
Determination Date of Treasury bills having the Index Maturity specified in the applicable pricing supplement or term sheet as published in H.15(519) under the caption "U.S. government
securities/treasury bills/secondary market" or, if not yet published by 3:00 P.M., New York City time, on the related calculation date, the rate on such Treasury Rate Interest Determination
Date of such treasury bills as published in H.15 Daily Update, or such other recognized electronic source used for the purpose of displaying such rate, under the caption "U.S. government
securities/treasury bills (secondary market)." If such rate is not yet published in the H.15(519), H.15 Daily Update or another recognized electronic source by 3:00 P.M., New York City time, on
the related calculation date, then the Treasury Rate on such Treasury Rate Interest Determination Date shall be
20
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calculated
by the calculation agent and shall be the bond equivalent yield of the arithmetic mean of the secondary market bid rates, as of approximately 3:30 P.M., New York City time, on such
Treasury Rate Interest Determination Date, of the three leading primary United States government securities dealers (which may include the agents or their affiliates) selected by the calculation
agent, for the issue of Treasury bills with a remaining maturity closest to the Index Maturity specified in the applicable pricing supplement or term sheet;
provided,
however
, that if the dealers so selected by the calculation agent are not quoting as mentioned in this sentence, the Treasury Rate determined as of such Treasury Rate Interest
Determination Date will be the Treasury Rate in effect on such Treasury Rate Interest Determination Date.
"bond equivalent yield"
means a yield calculated in accordance with the following formula and expressed as a percentage:
|
|
|
|
|
|
|
bond equivalent yield
|
|
=
|
|
D×N
N(D×M)
|
|
×100
|
where
"D" refers to the applicable per annum rate for Treasury bills quoted on a bank discount basis and expressed as a decimal, "N" refers to the number of days in the year, either 365 or 366, as the
case may be, and "M" refers to the actual number of days in the interest reset period for which interest is being calculated.
CMT Rate Notes.
The "CMT Rate" for any Interest Determination Date is as follows:
-
-
If "Reuters Page FRBCMT" is the specified CMT Reuters Page in the applicable pricing supplement or term sheet, the CMT Rate on the CMT Rate
Interest Determination Date shall be a percentage equal to the yield for United States Treasury securities at "constant maturity" having the Index Maturity specified in the applicable pricing
supplement or term sheet as set forth in H.15(519) under the caption "Treasury constant maturities," as such yield is displayed on Reuters (or any successor service) on page FRBCMT (or any
other page as may replace such page on such service) ("Reuters Page FRBCMT") for such CMT Rate Interest Determination Date.
-
-
If such rate does not appear on Reuters Page FRBCMT, the CMT Rate on such CMT Rate Interest Determination Date shall be a percentage equal to
the yield for United States Treasury securities at "constant maturity" having the Index Maturity specified in the applicable pricing supplement or term sheet and for such CMT Rate Interest
Determination Date as set forth in H.15(519) under the caption "Treasury constant maturities."
-
-
If such rate does not appear in H.15(519), the CMT Rate on such CMT Rate Interest Determination Date shall be the rate for the period of the
Index Maturity specified in the applicable pricing supplement or term sheet as may then be published by either the Federal Reserve Board or the United States Department of the Treasury that the
calculation agent determines to be comparable to the rate that would otherwise have been published in H.15(519).
-
-
If the Federal Reserve Board or the United States Department of the Treasury does not publish a yield on United States Treasury securities at
"constant maturity" having the Index Maturity specified in the applicable pricing supplement or term sheet for such CMT Rate Interest Determination Date, the CMT Rate on such CMT Rate Interest
Determination Date shall be calculated by the calculation agent and shall be a yield-to-maturity based on the arithmetic mean of the secondary market bid prices at approximately 3:30 P.M., New
York City time, on such CMT Rate Interest Determination Date of three leading primary United States government securities dealers in New York City (which may include the agents or their affiliates)
(each, a "reference dealer") selected by the calculation agent from five such reference dealers selected by the calculation agent and eliminating the highest quotation (or, in the event of equality,
one of
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the
highest) and the lowest quotation (or, in the event of equality, one of the lowest) for United States Treasury securities with an original maturity equal to the Index Maturity specified in the
applicable pricing supplement or term sheet, a remaining term to maturity no more than one year shorter than such Index Maturity and in a principal amount that is representative for a single
transaction in such securities in such market at such time. If fewer than three prices are provided as requested, the CMT Rate on such CMT Rate Interest Determination Date shall be calculated by the
calculation agent and shall be a yield-to-maturity based on the arithmetic mean of the secondary market bid prices as of approximately 3:30 P.M., New York City time, on such CMT Rate Interest
Determination Date of three reference dealers selected by the calculation agent from five such reference dealers selected by the calculation agent and eliminating the highest quotation (or, in the
event of equality, one of the highest) and the lowest quotation (or, in the event of equality, one of the lowest) for United States Treasury securities with an original maturity greater than the Index
Maturity specified in the applicable pricing supplement or term sheet, a remaining term to maturity closest to such Index Maturity and in a principal amount that is representative for a single
transaction in such securities in such market at such time. If two such United States Treasury securities with an original maturity greater than the Index Maturity specified in the applicable pricing
supplement or term sheet have remaining terms to maturity equally close to such Index Maturity, the quotes for the treasury security with the shorter original term to maturity will be used. If fewer
than five but more than two such prices are provided as requested, the CMT Rate on such CMT Rate Interest Determination Date shall be calculated by the calculation agent and shall be based on the
arithmetic mean of the bid prices obtained and neither the highest nor the lowest of such quotations shall be eliminated;
provided
,
however
, that if fewer
than three such prices are provided as requested, the CMT Rate determined as of such CMT Rate Interest Determination Date shall
be the CMT Rate in effect on such CMT Rate Interest Determination Date.
-
-
If "Reuters Page FEDCMT" is the specified CMT Reuters Page in the applicable pricing supplement or term sheet, the CMT Rate on the CMT Rate
Interest Determination Date shall be a percentage equal to the one-week or one-month, as specified in the applicable pricing supplement or term sheet, average yield for United States Treasury
securities at "constant maturity" having the Index Maturity specified in the applicable pricing supplement or term sheet as set forth in H.15(519) opposite the caption "Treasury Constant
Maturities," as such yield is displayed on Reuters on page FEDCMT (or any other page as may replace such page on such service) ("Reuters Page FEDCMT") for the week or month, as applicable, ended
immediately preceding the week or month, as applicable, in which such CMT Rate Interest Determination Date falls.
-
-
If such rate does not appear on Reuters Page FEDCMT, the CMT Rate on such CMT Rate Interest Determination Date shall be a percentage equal to
the one-week or one-month, as specified in the applicable pricing supplement or term sheet, average yield for United States Treasury securities at "constant maturity" having the Index Maturity
specified in the applicable pricing supplement or term sheet for the week or month, as applicable, preceding such CMT Rate Interest Determination Date as set forth in H.15(519) opposite the
caption "Treasury Constant Maturities."
-
-
If such rate does not appear in H.15(519), the CMT Rate on such CMT Rate Interest Determination Date shall be the one-week or one-month, as
specified in the applicable pricing supplement or term sheet, average yield for United States Treasury securities at "constant maturity" having the Index Maturity specified in the applicable pricing
supplement or term sheet as otherwise announced by the Federal Reserve Bank of New York for the week or month, as applicable, ended immediately preceding the week or month, as applicable, in which
such CMT Rate Interest Determination Date falls.
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-
-
If the Federal Reserve Bank of New York does not publish a one-week or one-month, as specified in the applicable pricing supplement or term
sheet, average yield on United States Treasury securities at "constant maturity" having the Index Maturity specified in the applicable pricing supplement or term sheet for the applicable week or
month, the CMT Rate on such CMT Rate Interest Determination Date shall be calculated by the calculation agent and shall be a yield-to-maturity based on the arithmetic mean of the secondary market bid
prices at approximately 3:30 P.M., New York City time, on such CMT Rate Interest Determination Date of three reference dealers selected by the calculation agent from five such reference dealers
selected by the calculation agent and eliminating the highest quotation (or, in the event of equality, one of the highest) and the lowest quotation (or, in the event of equality, one of the lowest)
for United States Treasury securities with an original maturity equal to the Index Maturity specified in the applicable pricing supplement or term sheet, a remaining term to maturity of no more than
one year shorter than such Index Maturity and in a principal amount that is representative for a single transaction in such securities in such market at such time. If fewer than five but more than two
such prices are provided as requested, the CMT Rate on such CMT Rate Interest Determination Date shall be the rate on the CMT Rate Interest Determination Date calculated by the calculation agent based
on the arithmetic mean of the bid prices obtained and neither the highest nor the lowest of such quotation shall be eliminated. If fewer than three prices are provided as requested, the CMT Rate on
such CMT Rate Interest Determination Date shall be calculated by the calculation agent and shall be a yield-to-maturity based on the arithmetic mean of the secondary market bid prices as of
approximately 3:30 P.M., New York City time, on such CMT Rate Interest Determination Date of three reference dealers selected by the calculation agent from five such reference dealers selected
by the calculation agent and eliminating the highest quotation (or, in the event of equality, one of the highest) and the lowest quotation (or, in the event of equality, one of the lowest) for United
States Treasury securities with an original maturity longer than the Index Maturity specified in the applicable pricing supplement or term sheet, a remaining term to maturity closest to such Index
Maturity and in a principal amount that is representative for a single transaction in such securities in such market at such time. If two United States Treasury securities with an original maturity
greater than the Index Maturity specified in the applicable pricing supplement or term sheet have remaining terms to maturity equally close to such Index Maturity, the quotes for the Treasury security
with the shorter original term to maturity will be used. If fewer than five but more than two such prices are provided as requested, the CMT Rate on such CMT Rate Interest Determination Date shall be
the rate on the CMT Rate Interest Determination Date calculated by the calculation agent based on the arithmetic mean of the bid prices obtained and neither the highest nor lowest of such quotations
shall be eliminated;
provided
,
however
, that if fewer than three such prices are provided as requested,
the CMT Rate determined as of such CMT Rate Determination Date shall be the CMT Rate in effect on such CMT Rate Interest Determination Date.
Eleventh District Cost of Funds Rate Notes.
The "Eleventh District Cost of Funds Rate" for any Interest Determination Date is the rate
equal to the
monthly weighted average cost of funds for the calendar month preceding the Interest Determination Date as displayed on Reuters Page COFI/ARMS (or any other page as may replace that specified page on
that service) as of 11:00 A.M., San Francisco time, on the Calculation Date for that Interest Determination Date under the caption "11th District."
The
following procedures will be used if the Eleventh District Cost of Funds Rate cannot be determined as described above:
-
-
If the rate is not displayed on the relevant page as of 11:00 A.M., San Francisco time, on the Calculation Date, then the Eleventh
District Cost of Funds Rate will be the monthly weighted average cost of funds paid by member institutions of the Eleventh Federal Home Loan Bank
23
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Indexed Notes
We may issue debt securities for which the amount of interest or principal that you will receive will not be known on your date of purchase.
Interest or principal payments for these types of debt securities, which we call "Indexed Notes," are determined by reference to securities, financial or non-financial indices, currencies,
commodities, interest rates, or a composite or baskets of any or all of the above. Examples of indexed items that may be used include a published stock index, the common stock price of a publicly
traded company, the value of the U.S. dollar versus the Japanese yen, or the price of a barrel of West Texas intermediate crude oil.
If
you purchase an Indexed Note, you may receive a principal amount at maturity that is greater than or less than the Note's face amount, and an interest rate that is greater than or
less than the interest rate that you would have earned if you had instead purchased a conventional debt security issued by us
at the same time with the same maturity. The amount of interest and principal that you will receive will depend on the structure of the Indexed Note and the level of the specified indexed item
throughout the term of the Indexed Note and at maturity. Specific information pertaining to the method of determining the interest payments and the principal amount will be described in the prospectus
supplement or term sheet, as well as additional risk factors unique to the Indexed Note, certain historical information for the specified indexed item and certain additional United States federal tax
considerations.
Renewable Notes
We may issue Renewable Notes ("Renewable Notes") which are debt securities that will automatically renew at their stated maturity date unless
the holder of a Renewable Note elects to terminate the automatic extension feature by giving notice in the manner described in the related prospectus supplement or term sheet.
The
holder of a Renewable Note must give notice of termination at least 15 but not more than 30 days prior to a Renewal Date. The holder of a Renewable Note may terminate the
automatic extension for less than all of its Renewable Notes only if the terms of the Renewable Note specifically permit partial termination. An election to terminate the automatic extension of any
portion of the Renewable Note is not revocable and will be binding on the holder of the Renewable Note. If the holder elects to terminate the automatic extension of the maturity of the Note, the
holder will become entitled to the principal and interest accrued up to the Renewal Date. The related prospectus supplement or term sheet will identify a stated maturity date beyond which the Maturity
Date cannot be renewed.
If
a Renewable Note is represented by a Global Security, DTC or its nominee will be the holder of the Note and therefore will be the only entity that can exercise a right to terminate
the automatic extension of a Note. In order to ensure that DTC or its nominee will exercise a right to terminate the automatic extension provisions of a particular Renewable Note, the beneficial owner
of the Note must instruct the broker or other DTC participant through which it holds an interest in the Note to notify DTC of its desire to terminate the automatic extension of the Note. Different
firms have different cut-off times for accepting instructions from their customers and, accordingly, each beneficial owner should consult the broker or other participant through which it holds an
interest in a Note to ascertain
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the
cut-off time by which an instruction must be given for delivery of timely notice to DTC or its nominee.
Extendible Notes
We may issue Notes whose stated Maturity Date may be extended at our option (an "Extendible Note") for one or more whole-year periods (each, an
"Extension Period"), up to but not beyond a stated maturity date described in the related prospectus supplement or term sheet (but not to exceed 30 years from the date of issue).
We
may exercise our option to extend the Extendible Note by notifying the applicable trustee (or any duly appointed paying agent) at least 45 but not more than 60 days prior to
the then effective Maturity Date. If we elect to extend the Extendible Note, the trustee (or paying agent) will mail (at least 40 days prior to the Maturity Date) to the registered holder of
the Extendible Note a notice (an "Extension Notice") informing the holder of our election, the new Maturity Date and any updated terms. Upon the mailing of the Extension Notice, the maturity of
that Extendible Note will be extended automatically as set forth in the Extension Notice.
However,
we may, not later than 20 days prior to the Maturity Date of an Extendible Note (or, if that date is not a Business Day, prior to the next Business Day), at our option,
establish a higher interest rate, in the case of a Fixed Rate Note, or a higher spread and/or spread multiplier, in the case of a Floating Rate Note, for the Extension Period by mailing or causing the
applicable trustee (or paying agent) to mail notice of such higher interest rate or higher spread and/or spread multiplier to the holder of the Note. The notice will be irrevocable.
If
we elect to extend the maturity of an Extendible Note, the holder of the Note will have the option to instead elect repayment of the Note by us on the then effective Maturity Date. In
order for an Extendible Note to be so repaid on the Maturity Date, we must receive, at least 15 days but not more than 30 days prior to the Maturity Date:
(1) the
Extendible Note with the form "Option to Elect Repayment" on the reverse of the Note duly completed; or
(2) a
facsimile transmission, telex or letter from a member of a national securities exchange or the Financial Industry Regulatory Authority (the "FINRA") or a commercial
bank or trust company in the United States setting forth the name of the holder of the Extendible Note, the principal amount of the Note, the principal amount of the Note to be repaid, the certificate
number or a description of the tenor and terms of the Note, a statement that the option to elect repayment is being exercised thereby and a guarantee that the Note be repaid, together with the duly
completed form entitled "Option to Elect Repayment" on the reverse of the Note, will be received by the applicable trustee (or paying
agent) not later than the fifth Business Day after the date of the facsimile transmission, telex or letter;
provided
,
however
; that the facsimile
transmission, telex or letter will only be effective if the Note and form duly completed are received by the applicable
trustee (or paying agent) by that fifth Business Day. The option may be exercised by the holder of an Extendible Note for less than the aggregate principal amount of the Note then outstanding if the
principal amount of the Note remaining outstanding after repayment is an authorized denomination.
If
an Extendible Note is represented by a Global Security, DTC or its nominee will be the holder of that Note and therefore will be the only entity that can exercise a right to
repayment. To ensure that DTC or its nominee timely exercises a right to repayment with respect to a particular Extendible Note, the beneficial owner of that Note must instruct the broker or other
participant through which it holds an interest in the Note to notify DTC of its desire to exercise a right of repayment. Different firms have different cut-off times for accepting instructions from
their customers and, accordingly, each beneficial owner should consult the broker or other participant through which it holds an interest in an Extendible Note to determine the cut-off time by which
an instruction must be given for timely notice to be delivered to DTC or its nominee.
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Global Securities
What Is a Global Security?
As noted above, we usually will issue debt securities as registered securities in book-entry form only. A
global security
represents one or any other number of individual debt securities. Generally, all debt securities represented by the same global securities will have the same terms.
Each
debt security issued in book-entry form will be represented by a global security that we deposit with and register in the name of a financial institution or its nominee that we
select. The financial
institution that we select for this purpose is called the depositary. Unless we specify otherwise in the applicable prospectus supplement or term sheet, The Depository Trust Company, New York, New
York, known as DTC, will be the depositary for all debt securities issued in book-entry form.
A
global security may not be transferred to or registered in the name of anyone other than the depositary or its nominee, unless special termination situations arise. We describe those
situations below under "Special Situations when a Global Security Will Be Terminated." As a result of these arrangements, the depositary, or its nominee, will be the sole registered owner and holder
of all debt securities represented by a global security, and investors will be permitted to own only beneficial interests in a global security. Beneficial interests must be held by means of an account
with a broker, bank or other financial institution that in turn has an account with the depositary or with another institution that has an account with the depositary. Thus, an investor whose security
is represented by a global security will not be a holder of the debt security, but only an indirect holder of a beneficial interest in the global security.
Special Considerations for Global Securities.
As an indirect holder, an investor's rights relating to a global security will be
governed by the
account rules of the investor's financial institution and of the depositary, as well as general laws relating to securities transfers. The depositary that holds the global security will be considered
the holder of the debt securities represented by the global security.
If
debt securities are issued only in the form of a global security, an investor should be aware of the following:
-
-
An investor cannot cause the debt securities to be registered in his or her name, and cannot obtain certificates for his or her interest in the
debt securities, except in the special situations we describe below.
-
-
An investor will be an indirect holder and must look to his or her own bank or broker for payments on the debt securities and protection of his
or her legal rights relating to the debt securities, as we describe under "Issuance of Securities in Registered Form" above.
-
-
An investor may not be able to sell interests in the debt securities to some insurance companies and other institutions that are required by
law to own their securities in non-book-entry form.
-
-
An investor may not be able to pledge his or her interest in a global security in circumstances where certificates representing the debt
securities must be delivered to the lender or other beneficiary of the pledge in order for the pledge to be effective.
-
-
The depositary's policies, which may change from time to time, will govern payments, transfers, exchanges and other matters relating to an
investor's interest in a global security. We and the trustee have no responsibility for any aspect of the depositary's actions or for its records of ownership interests in a global security. We and
the trustee also do not supervise the depositary in any way.
-
-
If we redeem less than all the debt securities of a particular series being redeemed, DTC's practice is to determine by lot the amount to be
redeemed from each of its participants holding that series.
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-
-
An investor is required to give notice of exercise of any option to elect repayment of its debt securities, through its participant, to the
applicable trustee and to deliver the related debt securities by causing its participant to transfer its interest in those debt securities, on DTC's records, to the applicable trustee.
-
-
DTC requires that those who purchase and sell interests in a global security deposited in its book-entry system use immediately available
funds. Your broker or bank may also require you to use immediately available funds when purchasing or selling interests in a global security.
-
-
Financial institutions that participate in the depositary's book-entry system, and through which an investor holds its interest in a global
security, may also have their own policies affecting payments, notices and other matters relating to the debt securities. There may be more than one financial intermediary in the chain of ownership
for an investor. We do not monitor and are not responsible for the actions of any of those intermediaries.
Special Situations When a Global Security Will Be Terminated.
In a few special situations described below, a global security will be
terminated and
interests in it will be exchanged for certificates in non-book-entry form (certificated securities). After that exchange, the choice of whether to hold the certificated debt securities directly or in
street name will be up to the investor. Investors must consult their own banks or brokers to find out how to have their interests in a global security transferred on termination to their own names, so
that they will be holders. We have described the rights of holders and street name investors under "Issuance of Securities in Registered Form" above.
The
special situations for termination of a global security are as follows:
-
-
if the depositary notifies us that it is unwilling, unable or no longer qualified to continue as depositary for that global security, and we do
not appoint another institution to act as depositary within 60 days,
-
-
if we notify the trustee that we wish to terminate that global security, or
-
-
if an event of default has occurred with regard to the debt securities represented by that global security and has not been cured or waived; we
discuss defaults later under "Events of Default."
The
prospectus supplement or term sheet may list situations for terminating a global security that would apply only to the particular series of debt securities covered by the prospectus
supplement or term sheet. If a global security is terminated, only the depositary, and not we or the applicable trustee, is responsible for deciding the names of the institutions in whose names the
debt securities represented by the global security will be registered and, therefore, who will be the holders of those debt securities.
Payment and Paying Agents
We will pay interest to the person listed in the trustee's records as the owner of the debt security at the close of business on a particular
day in advance of each due date for interest, even if that person no longer owns the debt security on the interest due date. That day, usually about two weeks in advance of the interest due date, is
called the "record date." Because we will pay all the interest for an interest period to the holders on the record date, holders buying and selling debt securities must work out between themselves the
appropriate purchase price. The most common manner is to adjust the sales price of the debt securities to prorate interest fairly between buyer and seller based on their respective ownership periods
within the particular interest period. This prorated interest amount is called "accrued interest."
Payments on Global Securities.
We will make payments on a global security in accordance with the applicable policies of the depositary
as in effect
from time to time. Under those policies, we will make payments directly to the depositary, or its nominee, and not to any indirect holders who own beneficial interests in the global security. An
indirect holder's right to those payments will be governed by the
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rules
and practices of the depositary and its participants, as described under "What Is a Global Security?".
Payments on Certificated Securities.
We will make payments on a certificated debt security as follows. We will pay interest that is due
on an
interest payment date by check mailed on the interest payment date
to the holder at his or her address shown on the trustee's records as of the close of business on the regular record date. We will make all payments of principal and premium, if any, by check at the
office of the applicable trustee in New York, New York and/or at other offices that may be specified in the prospectus supplement or term sheet or in a notice to holders, against surrender of the debt
security.
Alternatively,
if the holder asks us to do so, we will pay any amount that becomes due on the debt security by wire transfer of immediately available funds to an account at a bank in New
York City, on the due date. To request payment by wire, the holder must give the applicable trustee or other paying agent appropriate transfer instructions at least 15 Business Days before the
requested wire payment is due. In the case of any interest payment due on an interest payment date, the instructions must be given by the person who is the holder on the relevant regular record date.
Any wire instructions, once properly given, will remain in effect unless and until new instructions are given in the manner described above.
Payment When Offices Are Closed.
If any payment is due on a debt security on a day that is not a Business Day, we will make the payment
on the next
day that is a Business Day. Payments made on the next Business Day in this situation will be treated under the Indenture as if they were made on the original due date, except as otherwise indicated in
the attached prospectus supplement or term sheet. Such payment will not result in a default under any debt security or the Indenture, and no interest will accrue on the payment amount from the
original due date to the next day that is a Business Day.
Material Covenants
Consolidation, Merger, Sale or Conveyance.
The Indenture provides that AAM Inc. or Holdings may not 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:
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-
the successor or transferee entity, if other than AAM Inc. 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 debt securities and the performance of every covenant and
obligation in the Indenture to be performed or observed by AAM Inc. or Holdings, as the case may be;
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-
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
-
-
AAM Inc. 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 AAM Inc. or Holdings, as the case may be, as obligor
or guarantor on the debt securities, as the case may be, with the same effect as if it had been named in the Indenture as AAM Inc. or Holdings, as the case may be.
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Limitation on Liens.
AAM Inc. 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
AAM Inc. or Holdings or any Restricted Subsidiary, whether owned at the date of the Indenture or thereafter acquired, without effectively providing concurrently that the debt securities 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 our company 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 our company, 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 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.
Notwithstanding
the restrictions described above, AAM Inc., Holdings and any Restricted Subsidiaries may create, incur, issue, assume or guarantee Debt secured by Mortgages
without equally and ratably securing the debt securities 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 AAM Inc., Holdings and the
Restricted Subsidiaries in respect of Sale and Leaseback Transactions with respect to Operating Properties (with the exception of such transactions
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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.
"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.
"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, our company 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.
"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.
"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).
"Operating Property"
means any real property or equipment located in the United States owned by, or leased to, AAM Inc., 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.
"Restricted Subsidiary"
means any Subsidiary (excluding AAM Inc.) that owns Operating Property.
"Sale and Leaseback Transaction"
means any arrangement with any Person providing for the leasing to AAM Inc., Holdings or any
Subsidiary of any Operating Property, which Operating Property has been or is to be sold or transferred by AAM Inc., 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 AAM Inc. or Holdings, or by one or more other Subsidiaries, or by AAM Inc. or Holdings and one or more
other Subsidiaries.
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Limitation on Sale and Leaseback Transactions.
AAM Inc. 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 our company, Holdings or another Restricted Subsidiary;
(2) the
lease is for a period not in excess of 24 months, including renewals;
(3) our
company, 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 debt securities 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) our
company, 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 debt securities, other Funded Debt of our company or Holdings ranking on a parity with the debt securities or Funded Debt of a Restricted Subsidiary or (ii) the
purchase of Operating Property; or
(5) the
Attributable Debt of our company, 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 debt securities (or secure such outstanding
debt securities on a basis that is prior to other Debt secured thereby), would not exceed 10% of Consolidated Tangible Net Assets.
"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.
"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 our
company, Holdings or a Subsidiary.
Events of Default
An event of default is defined in the Indenture as:
(a) default
for 30 days in payment of any interest on the debt securities when it becomes due and payable;
(b) default
in payment of principal of or any premium on the debt securities at maturity or redemption or repurchase price when the same becomes due and payable;
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(c) default
by us or Holdings in the performance of any other covenant contained in the Indenture for the benefit of the debt securities 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 of Holdings 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 note holders, 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 when due or resulting in acceleration of other indebtedness of AAM Inc., 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 the debt securities,
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; and
(f) certain
events of bankruptcy, insolvency and reorganization of our company or Holdings.
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:
-
-
if an event of default described in clause (a), (b), (c), (d) or (e) above has occurred and is continuing, either the
trustee or the holders of not less than 25% in aggregate principal amount of the debt securities may declare the principal amount of the debt securities then outstanding, and any accrued and unpaid
interest through the date of such declaration, to be due and payable immediately;
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-
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, the debt securities and in compliance with certain covenants) may be waived by the holders of a majority in aggregate principal amount of the debt securities then outstanding; and
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-
if an event of default described in clause (f) occurs and is continuing, then the principal amount of all debt securities 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.
Under
the Indenture, the trustee must give to the holders of debt securities notice of all uncured defaults known to it with respect to the debt securities 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 or any premium on, any of the debt
securities, 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 debt securities.
No
holder of any debt securities may institute any action under the Indenture unless:
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-
such holder has given the trustee written notice of a continuing event of default with respect to the debt securities;
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the holders of not less than 25% in aggregate principal amount of the debt securities then outstanding have requested the trustee to institute
proceedings in respect of such event of default;
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-
such holder or holders have offered the trustee such reasonable indemnity as the trustee may require;
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the trustee has failed to institute an action for 60 days thereafter; and
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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
debt securities.
The
holders of a majority in aggregate principal amount of the debt securities 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 the debt securities. The Indenture
provides that, if an event of default occurs and is continuing, 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 our company signed by one of the officers of our company to the effect that a
review of our activities during such year and our performance under the Indenture and the terms of the debt securities 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
We, the trustee and, if applicable, Holdings and any Subsidiary Guarantors, may, without the consent of the holders of the debt securities
issued under the Indenture, enter into supplemental indenture for, among others, one or more of the following purposes:
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to evidence the succession of another corporation to our company, and the assumption by such successor of our obligations under the Indenture
and the debt securities;
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to add covenants of our company, or surrender any rights of the company, or add any rights for the benefit of the holders of debt securities;
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to cure any ambiguity, omission, defect or inconsistency in such Indenture; provided that such action does not adversely affect the interests
of the holders of any series and any related coupons in any material respect;
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-
to add any guarantors with respect to the securities of any series;
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-
to establish the form or terms of any other series of debt securities, including the form or terms of any Subsidiary Guarantor's guarantee of
the securities and/or the provisions and procedures relating to securities convertible into or exchangeable for any securities of any Person, including the Company or Holdings;
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-
to evidence and provide the acceptance of any successor trustee with respect to the debt securities 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
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to provide any additional events of default.
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With
certain exceptions, the Indenture, the Holdings guarantee, any Subsidiary guarantee or the rights of the holders of the debt securities may be modified by us and the trustee with
the consent of the holders of a majority in aggregate principal amount of the debt securities then outstanding, but no such modification may be made without the consent of the holder of each
outstanding debt security affected thereby that would:
-
-
change the maturity of any payment of principal of, or any premium on, any debt securities, or change any place of payment where, or the coin
or currency in which, any debt security 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 the outstanding debt securities, 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 debt securities affected thereby.
Defeasance
The following provisions will be applicable to each series of debt securities unless we state in the applicable prospectus supplement or term
sheet that the provisions of covenant defeasance and full defeasance will not be applicable to that series.
Covenant Defeasance.
Under current United States federal tax law, we can make the deposit described below and be released from some of
the
restrictive covenants in the Indenture under which the particular series was issued. This is called "covenant defeasance." In that event, you would lose the protection of those restrictive covenants
but would gain the protection of having money and government securities set aside in trust to repay your debt securities. If you hold subordinated securities, you also would be released from the
subordination provisions described in the applicable prospectus supplement or term sheet. In order to achieve covenant defeasance, we must do the following:
-
-
If the debt securities of the particular series are denominated in U.S. dollars, deposit in trust for the benefit of all holders of such debt
securities a combination of money and United States government or United States government agency debt securities or bonds that will generate enough cash to make interest, principal and any other
payments on the debt securities on their various due dates.
-
-
Deliver to the trustee a legal opinion of our counsel confirming that, under current United States federal income tax law, we may make the
above deposit without causing you to be taxed on the debt securities any differently than if we did not make the deposit and just repaid the debt securities ourselves at maturity.
-
-
Deliver to the trustee a legal opinion of our counsel stating that the above deposit does not require registration by us under the Investment
Company Act of 1940, as amended, and a legal opinion and officers' certificate stating that all conditions precedent to covenant defeasance have been complied with.
If
we accomplish covenant defeasance, you can still look to us for repayment of the debt securities if there were a shortfall in the trust deposit or the trustee is prevented from making
payment. In fact, if
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one
of the remaining Events of Default occurred (such as our bankruptcy) and the debt securities became immediately due and payable, there might be a shortfall. Depending on the event causing the
default, you may not be able to obtain payment of the shortfall.
Full Defeasance.
If there is a change in United States federal tax law, as described below, we can legally release ourselves from all
payment and
other obligations on the debt securities of a particular series (called "full defeasance") if we put in place the following other arrangements for you to be repaid:
-
-
If the debt securities of the particular series are denominated in U.S. dollars, we must deposit in trust for the benefit of all holders of
such debt securities a combination of money and United States government or United States government agency debt securities or bonds that will generate enough cash to make interest, principal and any
other payments on the debt securities on their various due dates.
-
-
We must deliver to the trustee a legal opinion confirming that there has been a change in current United States federal tax law or an Internal
Revenue Service ruling that allows us to make the above deposit without causing you to be taxed on the debt securities any differently than if we did not make the deposit and just repaid the debt
securities ourselves at maturity. Under current United States federal tax law, the deposit and our legal release from the debt securities would be treated as though we paid you your share of the cash
and debt securities or bonds at the time the cash and debt securities or bonds were deposited in trust in exchange for your debt securities and you would recognize gain or loss on the debt securities
at the time of the deposit.
-
-
We must deliver to the trustee a legal opinion of our counsel stating that the above deposit does not require registration by us under the
Investment Company Act of 1940, as amended, and a legal opinion and officers' certificate stating that all conditions precedent to defeasance have been complied with.
If
we ever did accomplish full defeasance, as described above, you would have to rely solely on the trust deposit for repayment of the debt securities. You could not look to us for
repayment in the unlikely event of any shortfall. Conversely, the trust deposit would most likely be protected from claims of our lenders and other creditors if we ever became bankrupt or insolvent.
If you hold subordinated securities, you would also be released from the subordination provisions described in the applicable prospectus supplement or term sheet.
Discharge of the Indenture
We may satisfy and discharge our obligations under the Indenture by delivering to the trustee for cancellation all outstanding debt securities
or by depositing with the trustee or the paying agent after the debt securities have become due and payable, whether at stated maturity, or any redemption date, or otherwise, cash sufficient to pay
all of the outstanding debt securities and paying all other sums payable under the Indenture by our company.
Form, Exchange and Transfer of Certificated Registered Securities
If registered debt securities cease to be issued in book-entry form, they will be issued:
-
-
only in fully registered certificated form,
-
-
without interest coupons, and
-
-
unless we indicate otherwise in the prospectus supplement or term sheet, in denominations of $2,000 and amounts that are multiples of $1,000.
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Holders
may exchange their certificated securities for debt securities of smaller denominations or combined into fewer debt securities of larger denominations, as long as the total
principal amount is not changed.
Holders
may exchange or transfer their certificated securities at the office of their trustee. We have appointed the trustee to act as our agent for registering debt securities in the
names of holders transferring debt securities. We may appoint another entity to perform these functions or perform them ourselves.
Holders
will not be required to pay a service charge to transfer or exchange their certificated securities, but they may be required to pay any tax or other governmental charge
associated with the transfer or
exchange. The transfer or exchange will be made only if our transfer agent is satisfied with the holder's proof of legal ownership.
If
we have designated additional transfer agents for your debt security, they will be named in your prospectus supplement or term sheet. We may appoint additional transfer agents or
cancel the appointment of any particular transfer agent. We may also approve a change in the office through which any transfer agent acts.
If
any certificated securities of a particular series are redeemable and we redeem less than all the debt securities of that series, we may block the transfer or exchange of those debt
securities during the period beginning 15 days before the day we mail the notice of redemption and ending on the day of that mailing, in order to freeze the list of holders to prepare the
mailing. We may also refuse to register transfers or exchanges of any certificated securities selected for redemption, except that we will continue to permit transfers and exchanges of the unredeemed
portion of any debt security that will be partially redeemed.
If
a registered debt security is issued in book-entry form, only the depositary will be entitled to transfer and exchange the debt security as described in this subsection, since it will
be the sole holder of the debt security.
Resignation of Trustee
The trustee may resign or be removed with respect to one or more series of indenture securities
provided
that a successor trustee is
appointed to act with respect to these series. In the event that two or more persons are acting as trustee with
respect to different series of indenture securities under the Indenture, each of the trustees will be a trustee of a trust separate and apart from the trust administered by any other trustee.
The Trustee Under the Indenture
U.S. Bank National Association is one of a number of banks with which we maintain ordinary banking relationships and from which we may have
obtained credit facilities and lines of credit.
Certain Considerations Relating to Foreign Currencies
Debt securities denominated or payable in foreign currencies may entail significant risks. These risks include the possibility of significant
fluctuations in the foreign currency markets, the imposition or modification of foreign exchange controls and potential illiquidity in the secondary market. These risks will vary depending upon the
currency or currencies involved and will be more fully described in the applicable prospectus supplement or term sheet.
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DESCRIPTION OF GUARANTEES
The Guarantees
This section summarizes some of the terms of the guarantees by Holdings and/or any relevant Subsidiary Guarantor. Most of the financial terms
and other specific material terms of any guarantees that we offer will be described in a prospectus supplement or term sheet to be attached to the front of this prospectus. Furthermore, since the
terms of specific guarantees may differ from the
general information we have provided below, you should rely on information in the prospectus supplement or term sheet that contradicts different information below.
Each
guarantee by Holdings and/or any Subsidiary Guarantors may:
-
-
be senior obligations of the relevant Guarantor in the case of senior debt securities;
-
-
be the unsecured and unsubordinated obligations of the relevant Guarantor in the case of senior unsecured debt securities;
-
-
rank equally (or
pari passu
) with all other existing and future unsubordinated and unsecured
indebtedness of the relevant Guarantor, respectively in the case of senior unsecured debt securities; and
-
-
with respect to any series of debt securities that is designated as subordinated, be junior and subordinated to any guarantee of any senior
indebtedness on the same basis as such debt securities are junior and subordinated to any senior indebtedness.
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.
Not
all of our subsidiaries will guarantee the debt securities. In the event of a bankruptcy, liquidation or reorganization of any of these non-guarantor subsidiaries, these
non-guarantor subsidiaries will pay holders of their debts and their trade creditors before they will be able to distribute any of their assets to us.
Each
guarantee by a Subsidiary Guarantor will provide by its terms that it will be automatically and unconditionally released and discharged in accordance with its terms as more fully
described in the applicable prospectus supplement or term sheet.
DESCRIPTION OF DEBT WARRANTS
We may issue (either separately or together with other offered securities) debt warrants to purchase underlying debt securities issued by us
("offered debt warrants"). We will issue the debt warrants under warrant agreements (each a "debt warrant agreement") to be entered into between us and a bank or trust company, as warrant agent (the
"debt warrant agent"), identified in the prospectus supplement or term sheet.
Because
this section is a summary, it does not describe every aspect of the debt warrants and the debt warrant agreement. We urge you to read the debt warrant agreement because it, and
not this description, defines your rights as a holder of debt warrants. We will file the form of debt warrant agreement with the SEC. See "Where You Can Find More Information" for information on how
to obtain a copy of the debt warrant agreement.
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General
You should read the prospectus supplement or term sheet for the material terms of the offered debt warrants, including the
following:
-
-
The title and aggregate number of the debt warrants.
-
-
The title, rank, aggregate principal amount and terms of the underlying debt securities purchasable upon exercise of the debt warrants.
-
-
The principal amount of underlying debt securities that may be purchased upon exercise of each debt warrant, and the price or the manner of
determining the price at which this principal amount may be purchased upon exercise.
-
-
The time or times at which, or the period or periods during which, the debt warrants may be exercised and the expiration date of the debt
warrants.
-
-
Any optional redemption terms.
-
-
Whether certificates evidencing the debt warrants will be issued in registered or bearer form and, if registered, where they may be transferred
and exchanged.
-
-
Whether the debt warrants are to be issued with any debt securities or any other securities and, if so, the amount and terms of these debt
securities or other securities.
-
-
The date, if any, on and after which the debt warrants and these debt securities or other securities will be separately transferable.
-
-
Any other material terms of the debt warrants.
The
prospectus supplement or term sheet will also contain a discussion of the United States federal income tax considerations relevant to the offering.
Debt
warrant certificates will be exchangeable for new debt warrant certificates of different denominations. No service charge will be imposed for any permitted transfer or exchange of
debt warrant certificates, but we may require payment of any tax or other governmental charge payable in connection therewith. Debt warrants may be exercised and exchanged and debt warrants in
registered form may be presented for registration of transfer at the corporate trust office of the debt warrant agent or any other office indicated in the prospectus supplement or term sheet.
Exercise of Debt Warrants
Each offered debt warrant will entitle the holder thereof to purchase the amount of underlying debt securities at the exercise price set forth
in, or calculable from, the prospectus supplement or term sheet relating to the offered debt warrants. After the close of business on the expiration date, unexercised debt warrants will be void.
Debt
warrants may be exercised by payment to the debt warrant agent of the applicable exercise price and by delivery to the debt warrant agent of the related debt warrant certificate,
properly completed. Debt warrants will be deemed to have been exercised upon receipt of the exercise price and the debt warrant certificate or certificates.
Upon
receipt of this payment and the properly completed debt warrant certificates, we will, as soon as practicable, deliver the amount of underlying debt securities purchased upon
exercise.
If
fewer than all of the debt warrants represented by any debt warrant certificate are exercised, a new debt warrant certificate will be issued for the unexercised debt warrants. The
holder of a debt warrant will be required to pay any tax or other governmental charge that may be imposed in
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connection
with any transfer involved in the issuance of underlying debt securities purchased upon exercise.
Modifications
There are three types of changes we can make to a debt warrant agreement and the debt warrants issued thereunder.
Changes Requiring Your Approval.
First, there are changes that cannot be made to your debt warrants without your specific approval.
Those types of
changes include modifications and amendments that:
-
-
accelerate the expiration date;
-
-
reduce the number of outstanding debt warrants, the consent of the holders of which is required for a modification or amendment; or
-
-
otherwise materially and adversely affect the rights of the holders of the debt warrants.
Changes Not Requiring Approval.
The second type of change does not require any vote by holders of the
debt warrants. This type of change is limited to clarifications and other changes that would not materially adversely affect the interests of holders of the debt warrants.
Changes Requiring a Majority Vote.
Any other change to the debt warrant agreement and the debt warrants requires a vote in favor by
holders of a
majority in number of the then outstanding unexercised debt warrants affected thereby. Most changes fall into this category.
No Rights as Holders of Underlying Debt Securities
Before the warrants are exercised, holders of the debt warrants are not entitled to payments of principal, premium or interest, if any, on the
related underlying debt securities or to exercise any rights whatsoever as holders of the underlying debt securities.
DESCRIPTION OF WARRANTS TO PURCHASE COMMON STOCK
Holdings may issue (either separately or together with other offered securities) warrants to purchase common stock of Holdings ("common
warrants"). We will issue the common warrants under warrant agreements (each, a "common warrant agreement") to be entered into between Holdings and a bank or trust company, as warrant agent (the
"common warrant agent"), identified in the prospectus supplement or term sheet.
Because
this section is a summary, it does not describe every aspect of the common warrants and common warrant agreement.
General
You should read the prospectus supplement or term sheet for the material terms of the offered common warrants, including the
following:
-
-
The title and aggregate number of the common warrants.
-
-
The number of shares of common stock that may be purchased upon exercise of each common warrant; the price, or the manner of determining the
price, at which the shares may be purchased upon exercise; if other than cash, the property and manner in which the exercise price may be paid; and any minimum number of common warrants that must be
exercised at any one time.
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-
-
The time or times at which, or period or periods in which, the common warrants may be exercised and the expiration date of the common warrants.
-
-
Any optional redemption terms.
-
-
The terms of any right that we may have to accelerate the exercise of the common warrants upon the occurrence of certain events.
-
-
Whether the common warrants will be sold with any other offered securities and, if so, the amount and terms of these other securities.
-
-
The date, if any, on and after which the common warrants and any other offered securities will be separately transferable.
-
-
Any other terms of the common warrants.
The
prospectus supplement or term sheet will also contain a discussion of the United States federal income tax considerations relevant to the offering.
Certificates
representing common warrants will be exchangeable for new common warrant certificates of different denominations. We will not impose a service charge for any permitted
transfer or exchange of common warrant certificates, but we may require payment of any tax or other governmental charge payable in connection therewith. Common warrants may be exercised at the
corporate trust office of the common warrant agent or any other office indicated in the prospectus supplement or term sheet.
Exercise of Common Warrants
Each offered common warrant will entitle the holder thereof to purchase the number of shares of Holdings' common stock at the exercise price set
forth in, or calculable from, the prospectus supplement or term sheet relating to the common warrants. After the close of business on the applicable expiration date, unexercised common warrants will
be void.
Common
warrants may be exercised by payment to the common warrant agent of the exercise price and by delivery to the common warrant agent of the related common warrant certificate, with
the reverse side thereof properly completed. Common warrants will be deemed to have been exercised upon receipt of the exercise price and the common warrant certificate or certificates. Upon receipt
of the payment and the properly completed common warrant certificates, we will, as soon as practicable, deliver the shares of common stock purchased upon the exercise.
If
fewer than all of the common warrants represented by any common warrant certificate are exercised, a new common warrant certificate will be issued for the unexercised offered common
warrants. The holder of an offered common warrant will be required to pay any tax or other governmental charge
that may be imposed in connection with any transfer involved in the issuance of common stock purchased upon exercise.
Modifications
There are three types of changes Holdings can make to a common warrant agreement and the common warrants issued thereunder.
Changes Requiring Your Approval.
First, there are changes that cannot be made to your common warrants without your specific approval.
Those types of
changes include modifications and amendments that:
-
-
accelerate the expiration date;
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-
-
reduce the number of outstanding common warrants, the consent of the holders of which is required for a modification or amendment; or
-
-
otherwise materially and adversely affect the rights of the holders of the common warrants.
Changes Not Requiring Approval.
The second type of change does not require any vote by holders of the common warrants. This type of
change is limited
to clarifications and other changes that would not materially adversely affect the interests of the holders of the common warrants.
Changes Requiring a Majority Vote.
Any other change to the common warrant agreement requires a vote in favor by holders of not fewer
than a majority
in number of the then outstanding unexercised common warrants affected thereby. Most changes fall into this category.
Common Warrant Adjustments
The terms and conditions on which the exercise price of and/or the number of shares of common stock covered by a common warrant are subject to
adjustment will be set forth in the common warrant agreement and the prospectus supplement or term sheet. The terms will include provisions for adjusting the exercise price and/or the number of shares
of common stock covered by the common warrant; the events requiring the adjustment; the events upon which we may, in lieu of making the adjustment, make proper provisions so that the holder of a
common warrant, upon exercise thereof, would be treated as if the holder had exercised the common warrant prior to the occurrence of the events; and provisions affecting exercise in the event of
certain events affecting the common stock.
No Rights as Stockholders
Holders of common warrants are not entitled, by virtue of being holders, to receive dividends or to vote, consent or receive notice as our
stockholders in respect of any meeting of stockholders for the election of our directors or for any other matter, or exercise any other rights whatsoever as our stockholders.
DESCRIPTION OF COMMON STOCK
The following summary describes elements of Holdings' Certificate of Incorporation and Bylaws.
Holdings'
authorized capital stock consists of (i) 150,000,000 shares of common stock, par value $.01 per share, of which 76,478,463 shares were issued and outstanding as of
February 8, 2017, (ii) 10,000,000 shares of preferred stock, par value $.01 per share of which no shares are issued and outstanding and (iii) 40,000,000 shares of series common
stock, par value $.01 per share, of which no shares are issued and outstanding. The following description of Holdings' capital stock and related matters is qualified in its entirety by reference to
the Certificate of Incorporation and the Bylaws, copies of which are on file with the SEC.
Common Stock
Holders of common stock are entitled to one vote per share on all matters to be voted upon by the stockholders. The holders of common stock do
not have cumulative voting rights in the election of directors. Holders of common stock are entitled to receive dividends if, as and when dividends are declared from time to time by Holdings' Board of
Directors out of funds legally available therefor, after payment of dividends required to be paid on outstanding preferred stock or series common stock (as described below), if any. In the event of
liquidation, dissolution or winding up of Holdings, the holders of common stock are entitled to share ratably in all assets remaining after payment of liabilities and accrued but unpaid dividends and
liquidation preferences on any outstanding preferred stock or series common stock of Holdings. The common stock has no preemptive or conversion rights and is not subject to further calls or assessment
by Holdings. There are no redemption or sinking fund provisions
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applicable
to the common stock. The common stock sold by Holdings in an offering pursuant to this prospectus, when sold to the underwriters of such offering in the manner described in this prospectus
and the prospectus supplement or term sheet relating to such offering will be, and all currently outstanding common stock of Holdings is, duly authorized, validly issued, fully paid and
non-assessable.
Preferred Stock and Series Common Stock
The Certificate of Incorporation authorizes the Board of Directors to establish one or more series of preferred stock and series common stock
and to determine, with respect to any series of preferred stock or series common stock, the terms and rights of such series, including (i) the designation of the series, (ii) the number
of shares of the series, which number the Board may thereafter (except where otherwise provided in the preferred stock or series common stock designation) increase or decrease (but not below the
number of shares thereof then outstanding), (iii) whether dividends, if any, will be cumulative or non-cumulative and the dividend rate of the series, (iv) the dates at which dividends,
if any, will be payable, (v) the redemption rights and price or prices, if any, for shares of the series, (vi) the terms and amounts of any sinking fund provided for the purchase or
redemption of shares of the series, (vii) the amounts payable on shares of the series in the event of any voluntary or involuntary liquidation, dissolution or winding-up of the affairs of
Holdings, (viii) whether the shares of the series will be convertible into shares of any other class or series, or any other security, of Holdings or any other corporation, and, if so, the
specification of such other class or series or such other security, the conversion price or prices or rate or rates, any adjustments thereof, the date or dates as of which such shares shall be
convertible and all other terms and conditions upon which such conversion may be made, (ix) restrictions on the issuance of shares of the same series or of any other class or series, and
(x) the voting rights, if any, of the holders of such series. The authorized shares of preferred stock and series common stock, as well as shares of common stock, will be available for issuance
without further action by Holdings' stockholders, unless such action is required by applicable law or the rules of any stock exchange or automated quotation system on which the Holdings' securities
may be listed or traded.
Although
the Board has no intention at the present time of doing so, it could issue a series of preferred stock or series common stock that could, depending on the terms of such series,
impede the completion of a merger, tender offer or other takeover attempt. The Board will make any determination to issue such shares based on its judgment as to the best interests of Holdings and its
stockholders. The Board, in so acting, could issue preferred stock or series common stock having terms that could discourage an acquisition attempt or other transaction that some, or a majority, of
the Holdings' stockholders might believe to be in their best interests or in which stockholders might receive a premium for their stock over the then-current market price of such stock.
Authorized but Unissued Capital Stock
Delaware law does not require stockholder approval for any issuance of authorized shares. However, the listing requirements of the New York
Stock Exchange, which would apply so long as the common stock remains listed on the New York Stock Exchange, require stockholder approval of certain issuances equal to or exceeding 20% of the then
outstanding voting
power or then outstanding number of shares of common stock. These additional shares may be used for a variety of corporate purposes, including future public offerings to raise additional capital or to
facilitate acquisitions.
One
of the effects of the existence of unissued and unreserved common stock, preferred stock and series common stock may be to enable Holdings' Board of Directors to issue shares to
persons friendly to current management, which issuance could render more difficult or discourage an attempt to obtain control of the Holdings by means of a merger, tender offer, proxy contest or
otherwise, and thereby protect the continuity of Holdings' management and possibly deprive the stockholders of opportunities to sell their shares of common stock at prices higher than prevailing
market prices.
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The Delaware General Corporation Law
Holdings is a Delaware corporation subject to Section 203 of the Delaware General Corporation Law (the "DGCL").
Section 203 provides that, subject to certain exceptions specified therein, a Delaware corporation shall not engage in certain "business combinations" with any "interested stockholder" for a
three-year period following the time that such stockholder became an interested stockholder unless (i) the corporation has elected in its certificate of incorporation not to be governed by
Section 203 (Holdings has not made such an election), (ii) prior to such time, the board of directors of the corporation approved either the business combination or the transaction which
resulted in the stockholder becoming an interested stockholder, (iii) upon consummation of the transaction which resulted in the stockholder becoming an interested stockholder, the interested
stockholder owned at least 85% of the voting stock of the corporation outstanding at the time the transaction commenced (excluding certain shares), or (iv) at or subsequent to such time, the
business combination is approved by the board of directors of the corporation and by the affirmative vote of at least 66
2
/
3
% of the outstanding voting stock which is not owned by the
interested stockholder. The three-year prohibition also does not apply to certain business combinations proposed by an interested stockholder following the announcement or notification of certain
extraordinary transactions involving the corporation and a person who had not been an interested stockholder during the previous three years or who became an interested stockholder with the approval
of a majority of the corporation's directors. The term "business combination" is defined generally to include mergers or consolidations between a Delaware corporation and an "interested stockholder,"
transactions with an "interested stockholder" involving the assets or stock of the corporation or its majority-owned subsidiaries and transactions which increase an interested stockholder's percentage
ownership of stock. Except as specified in Section 203 of the DGCL, an "interested stockholder" is defined to include any person, other than the corporation and any direct or indirect
majority-owned subsidiary, that is (x) the owner of 15% or more of the outstanding voting stock of the corporation, or is an affiliate or associate of the corporation and was the owner of 15%
or
more of the outstanding voting stock of the corporation, at any time within three years immediately prior to the relevant date or (y) the affiliates and associates of any such person.
Under
certain circumstances, Section 203 makes it more difficult for a person who would be an "interested stockholder" to effect various business combinations with a corporation
for a three-year period. The provisions of Section 203 may encourage companies interested in acquiring Holdings to negotiate in advance with Holdings' Board of Directors, because the
stockholder approval requirement would be avoided if the Board of Directors approves either the business combination or the transaction which results in the stockholder becoming an interested
stockholder. Such provisions also may have the effect of preventing changes in Holdings' Board of Directors and may make it more difficult to accomplish transactions which stockholders may otherwise
deem to be in their best interests.
Certificate of Incorporation; Bylaws
The Certificate of Incorporation and the Bylaws contain certain provisions that could make more difficult the acquisition of Holdings by means
of a tender offer, a proxy contest or otherwise.
Classified Board.
The Certificate of Incorporation provides that Holdings' Board of Directors will be divided into three classes of
directors, with
the classes to be as nearly equal in number as possible. As a result, approximately one-third of the Board of Directors will be elected each year. The classification of directors will have the effect
of making it more difficult for stockholders to change the composition of Holdings' Board. The Certificate of Incorporation provides that, subject to any rights of holders of Preferred Stock or Series
Common Stock to elect additional directors under specified circumstances, the number of directors will be fixed in the manner provided in the Bylaws. The Certificate of Incorporation and the Bylaws
provide that the number of directors will be fixed from time to time exclusively pursuant to a resolution adopted by the Board, but must consist of not less than three directors. In addition, the
Certificate of Incorporation provides that, subject to any rights of
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holders
of Preferred Stock, and unless the Board otherwise determines, any vacancies will be filled only by the affirmative vote of a majority of the remaining directors, though less than a quorum.
The Holdings' Board of Directors currently consists of eight directors, but will be increased to 11 members as a condition to, and effective upon, the completion of the merger with MPG.
Removal of Directors.
Under the DGCL, unless otherwise provided in the Certificate of Incorporation, directors serving on a classified
board may be
removed by the stockholders only for cause. In addition, the Certificate of Incorporation and the Bylaws provide that directors may be removed only for cause and only upon the affirmative vote of
holders of at least 75% of the voting power of all the then outstanding shares of stock entitled to vote generally in the election of directors ("Voting Stock"), voting together as a single class.
Stockholder Action.
The Certificate of Incorporation and the Bylaws provide that stockholder action can be taken only at an annual or
special meeting
of stockholders and may not be taken by written consent in lieu of a meeting. The Certificate of Incorporation and the Bylaws provide that special meetings of stockholders can be called only by
Holdings' Chief Executive Officer or pursuant to a resolution adopted by the Board. Stockholders are not permitted to call a special meeting or to require that the Board call a special meeting of
stockholders. Moreover, the business permitted to be conducted at any special meeting of stockholders is limited to the business brought before the meeting pursuant to the notice of meeting given by
Holdings.
Advance Notice Procedures.
The Bylaws establish an advance notice procedure for stockholders to make nominations of candidates for
election as
directors, or bring other business before an annual or special meeting of stockholders of Holdings (the "Stockholders Notice Procedure"). The Stockholders Notice Procedure provides that only persons
who are nominated by, or at the direction of the Board of Directors, the Chairman of the Board, or by a stockholder who has given timely written notice to the Secretary of Holdings prior to the
meeting at which directors are to be elected, will be eligible for election as directors of Holdings. The Stockholders Notice Procedure also provides that at an annual meeting only such business may
be conducted as has been brought before the meeting pursuant to the notice of meeting delivered by Holdings or by, or at the direction of, the Chairman of the Board or by a stockholder who is entitled
to vote at the meeting and who has given timely written notice to the Secretary of Holdings of such stockholder's intention to bring such business before such meeting. Under the Stockholders Notice
Procedure, for notice of stockholder nominations to be made at an annual meeting to be timely, such notice must be received by Holdings not less than 70 days nor more than 90 days prior
to the first anniversary of the previous year's annual meeting (or, if the date of the annual meeting is advanced by more than 20 days or delayed by more than 70 days from such
anniversary date, not earlier than the 90th day prior to such meeting and not later than the later of (x) the 70th day prior to such meeting and (y) the 10th day
after public announcement of the date of such meeting is first made). Notwithstanding the foregoing, in the event that the number of directors to be elected is increased and there is no public
announcement naming all of the nominees for director or specifying the size of the increased Board of Directors made by Holdings at least 80 days prior to the first anniversary of the preceding
year's annual meeting, a stockholder's notice will be timely, but only with respect to nominees for any new positions created by such increase, if it is received by Holdings not later than the
10th day after such public announcement is first made by Holdings. Under the Stockholders Notice Procedure, for notice of a stockholder nomination to be made at a special meeting at which
directors are to be elected to be timely, such notice must be received by Holdings not earlier than the 90th day before such meeting and not later than the later of (x) the
70th day prior to such
meeting and (y) the 10th day after the public announcement of the date of such meeting is first made. In addition, under the Stockholders Notice Procedure, a stockholder's notice to
Holdings proposing to nominate a person for election as a director or relating to the conduct of business other than the nomination of directors must contain certain specified information. If the
Chairman of the Board or other officer presiding at a meeting determines that a person was not nominated, or other business was
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not
brought before the meeting, in accordance with the Stockholders Notice Procedure, such person will not be eligible for election as a director, or such business will not be conducted at such
meeting, as the case may be.
Liability of Directors; Indemnification.
The Certificate of Incorporation provides that a director will not be personally liable for
monetary damages
to Holdings or its stockholders for breach of fiduciary duty as a director, except to the extent such exemption from liability or limitation thereof is not permitted under the DGCL. The Certificate of
Incorporation also provides that each current or former director, officer, employee or agent of Holdings, or each such person who is or was serving or who had agreed to serve at the request of
Holdings as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise (including the heirs, executors, administrators or estate of such
person), will be indemnified by Holdings to the full extent permitted by the DGCL, as the same exists or may in the future be amended (but, in the case of any such amendment, only to the extent that
such amendment permits Holdings to provide broader indemnification rights than said law permitted Holdings to provide prior to such amendment). The Certificate of Incorporation also specifically
authorizes Holdings to enter into agreements with any person providing for indemnification greater or different than that provided by the Certificate of Incorporation.
Amendment.
The Certificate of Incorporation provides that the affirmative vote of the holders of at least 75% of the voting power of the
outstanding
shares of Voting Stock, voting together as a single class, is required to amend provisions of the Certificate of Incorporation relating to the prohibition of stockholder action without a meeting; the
number, election and term of Holdings' directors; and the removal of directors. The Certificate of Incorporation further provides that the Bylaws may be amended by the Board or by the affirmative vote
of the holders of at least 75% of the outstanding shares of Voting Stock, voting together as a single class.
The
description set forth above is intended as a summary only and is qualified in its entirety by reference to the Certificate of Incorporation and the Bylaws, copies of which are
exhibits to the Registration Statement of which this prospectus is a part.
Registrar and Transfer Agent
The registrar and transfer agent for the common stock is Computershare Trust Co. of New York.
Listing
Holdings' common stock is listed on the New York Stock Exchange under the symbol "AXL."
DESCRIPTION OF PREFERRED STOCK
Under Holdings' Certificate of Incorporation, it is authorized to adopt resolutions providing for the issuance, in one or more series, of up to
10,000,000 shares of preferred stock, $.01 par value, with the powers, preferences and relative, participating, optional or other special rights and qualifications, limitations or restrictions thereof
adopted by the Board of Directors or a duly authorized committee thereof.
Because
this section is a summary, it does not describe every aspect of Holdings' preferred stock. We urge you to read Holdings' Certificate of Incorporation and the certificate of
designations creating your preferred stock because they, and not this description, define your rights as a holder of preferred stock. Holdings has filed the Certificate of Incorporation and will file
the certificate of designations with the SEC. See "Where You Can Find More Information" for information on how to obtain copies of these documents.
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The
specific material terms of any preferred stock proposed to be sold under this prospectus and an attached prospectus supplement or term sheet will be described in the prospectus
supplement or term sheet. If so indicated in the prospectus supplement or term sheet, the terms of the offered preferred stock may differ from the terms set forth below.
General
Unless otherwise specified in the prospectus supplement or term sheet relating to the offered preferred stock, each series of preferred stock
will rank on a parity as to dividends and distribution of assets upon liquidation and in all other respects with all other series of preferred stock. The preferred stock will, when issued, be fully
paid and nonassessable and holders thereof will have no preemptive rights.
You
should read the prospectus supplement or term sheet for the material terms of the preferred stock offered thereby, including the following:
-
-
The title and stated value of the preferred stock.
-
-
The number of shares of the preferred stock offered, the liquidation preference per share and the offering price of the preferred stock.
-
-
The dividend rate(s), period(s) and/or payment date(s) or method(s) of calculation thereof applicable to the preferred stock.
-
-
The date from which dividends on the preferred stock will accumulate, if applicable.
-
-
The liquidation rights of the preferred stock.
-
-
The procedures for any auction and remarketing, if any, of the preferred stock.
-
-
The sinking fund provisions, if applicable, for the preferred stock.
-
-
The redemption provisions, if applicable, for the preferred stock.
-
-
Whether the preferred stock will be convertible into or exchangeable for other securities and, if so, the terms and conditions of conversion or
exchange, including the conversion price or exchange ratio and the conversion or exchange period (or the method of determining the same).
-
-
Whether the preferred stock will have voting rights and the terms thereof, if any.
-
-
Whether the preferred stock will be listed on any securities exchange.
-
-
Whether the preferred stock will be issued with any other securities and, if so, the amount and terms of these other securities.
-
-
Any other specific material terms, preferences or rights of, or limitations or restrictions on, the preferred stock.
Subject
to Holdings' Certificate of Incorporation and to any limitations contained in its outstanding preferred stock, Holdings may issue additional series of preferred stock, at any
time or from time to time, with the powers, preferences and relative, participating, optional or other special rights and qualifications, limitations or restrictions thereof, as the Board of Directors
or any duly authorized committee thereof may determine, all without further action of its stockholders, including holders of its then outstanding preferred stock.
If
applicable, the prospectus supplement or term sheet will also contain a discussion of the material United States federal income tax considerations relevant to the offering.
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Dividends
Holders of preferred stock will be entitled to receive cash dividends, when, as and if declared by the Board of Directors, out of Holdings'
assets legally available for payment, at the rate and on the dates set forth in the prospectus supplement or term sheet. Each dividend will be payable to holders of record as they appear on Holdings'
stock books on the record date fixed by the Board of Directors. Dividends, if cumulative, will be cumulative from and after the date set forth in the applicable prospectus supplement or term sheet.
Holdings
may not:
-
-
declare or pay dividends (except in its stock that is junior as to dividends and liquidation rights to the preferred stock ("junior stock")) or
make any other distributions on junior stock, or
-
-
purchase, redeem or otherwise acquire junior stock or set aside funds for that purpose (except in a reclassification or exchange of junior
stock through the issuance of other junior stock or with the proceeds of a reasonably contemporaneous sale of junior stock),
if
there are arrearages in dividends or failure in the payment of the sinking fund or redemption obligations on any of Holdings' preferred stock and, in the case of the first bullet point above, if
dividends in full for the current quarterly dividend period have not been paid or declared on any of Holdings' preferred stock.
Dividends
in full may not be declared or paid or set apart for payment on any series of preferred stock unless:
-
-
there are no arrearages in dividends for any past dividend periods on any series of preferred stock, and
-
-
to the extent that the dividends are cumulative, dividends in full for the current dividend period have been declared or paid on all preferred
stock.
Any
dividends declared or paid when dividends are not so declared, paid or set apart in full will be shared ratably by the holders of all series of preferred stock in proportion to the
respective arrearages and undeclared and unpaid current cumulative dividends. No interest, or sum of money in lieu of interest, will be payable in respect of any dividend payment or payments that may
be in arrears.
Conversion and Exchange
If the preferred stock will be convertible into or exchangeable for common stock or other securities, the prospectus supplement or term sheet
will set forth the terms and conditions of that conversion or exchange, including the conversion price or exchange ratio (or the method of calculating the same), the conversion or exchange period (or
the method of determining the same), whether conversion or exchange will be mandatory or at the option of the holder or us, the events requiring an adjustment of the conversion price or the exchange
ratio and provisions affecting conversion or exchange in the event of the redemption of that preferred stock. These terms may also include provisions under which the number of shares of common stock
or the number or amount of other securities to be received by the holders of that preferred stock upon conversion or exchange would be calculated according to the market price of the common stock or
those other securities as of a time stated in the prospectus supplement or term sheet.
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Liquidation Rights
In the event of Holdings' voluntary or involuntary liquidation, dissolution or winding up, the holders of each series of the preferred stock
will be entitled to receive out of the assets that are available for distribution to stockholders, before any distribution of assets is made to holders of any junior stock, liquidating distributions
in the amount set forth in the applicable prospectus supplement or term sheet plus all accrued and unpaid dividends. If, upon Holdings' voluntary or involuntary liquidation, dissolution or winding up,
the amounts payable with respect to the preferred stock are not paid in full, the holders of preferred stock of each series will share ratably in the distribution of assets in proportion to the full
respective preferential amounts to which they are entitled. After payment of the full amount of the liquidating distribution to which they are entitled, the holders of the preferred stock will not be
entitled to any further participation in any distribution of assets. Holdings' consolidation or merger with or into any other corporation or corporations or a sale of all or substantially all of its
assets will not be deemed to be a liquidation, dissolution or winding up for purposes of these provisions.
Redemption
If so provided in the prospectus supplement or term sheet, the offered preferred stock may be redeemable in whole or in part at Holdings' option
at the times and at the redemption prices set forth therein.
If
dividends on any series of preferred stock are in arrears or Holdings has failed to fulfill its sinking fund or redemption obligations with respect to any series of preferred stock,
Holdings may not purchase or redeem shares of preferred stock or any other capital stock ranking on a parity with or junior to the preferred stock as to dividends or upon liquidation, nor permit any
subsidiary to do so, without in either case the consent of the holders of at least two-thirds of each series of preferred stock then outstanding;
provided
,
however
, that:
-
-
to meet purchase, retirement or sinking fund obligations with respect to any series of preferred stock, Holdings may use shares of that
preferred stock acquired prior to the arrearages or failure of payment and then held as treasury stock, and
-
-
Holdings may complete the purchase or redemption of shares of preferred stock for which a contract was entered into for any purchase,
retirement or sinking fund purposes prior to the arrearages or failure of payment.
Voting Rights
Except as indicated below or in the prospectus supplement or term sheet, or except as expressly required by applicable law, the holders of the
preferred stock will not be entitled to vote. As used herein, the term "applicable preferred stock" means those series of preferred stock to which the provisions described herein are expressly made
applicable by resolutions of the Board of Directors.
If
the equivalent of six quarterly dividends payable on any shares of any series of applicable preferred stock are in default (whether or not the dividends have been declared or the
defaulted dividends are consecutive), the number of directors will be increased by two and the holders of all outstanding series of applicable preferred stock, voting as a single class without regard
to series, will be entitled to elect the two additional directors until four consecutive quarterly dividends are paid or declared and set apart for payment, if the shares are cumulative, or until all
arrearages in dividends and dividends in full for the current quarterly period are paid or declared and set apart for payment, if the shares are non-cumulative, whereupon all voting rights described
herein will be divested from the applicable preferred stock. The holders of applicable preferred stock may exercise their special class voting rights at meetings of the stockholders for the election
of directors or at special meetings for the
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purpose
of electing directors, in either case at which the holders of not less than one-third of the aggregate number of shares of applicable preferred stock are present in person or by proxy.
The
affirmative vote of the holders of at least two-thirds of the outstanding shares of any series of preferred stock will be required:
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for any amendment of the Certificate of Incorporation (or the related certificate of designations) that will adversely affect the powers,
preferences or rights of the holders of the preferred stock of that series, or
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to create any class of stock (or increase the authorized number of shares of any class of stock) that will have preference as to dividends or
upon liquidation over the preferred stock of that series or create any stock or other security convertible into or exchangeable for or evidencing the right to purchase any stock of that class.
In
addition, the affirmative vote of the holders of a majority of all the shares of Holdings' preferred stock then outstanding will be required to increase the authorized amount of
preferred stock.
SPECIAL PROVISIONS RELATING TO FOREIGN CURRENCY DEBT SECURITIES
General
Unless otherwise indicated in the applicable prospectus supplement or term sheet, the debt securities will be denominated in U.S. dollars,
payments of principal of, premium, if any, and interest on the debt securities will be made in U.S. dollars and payment of the purchase price of the debt securities must be made in immediately
available funds. If any of the debt securities ("Foreign Currency Debt Securities") are to be denominated or payable in a currency (a "specified currency") other than U.S. dollars, the following
provisions will apply in addition to, and to the extent inconsistent therewith will replace, the description of general terms and provisions of debt securities set forth in the accompanying prospectus
and elsewhere in this prospectus.
A
prospectus supplement or term sheet with respect to any Foreign Currency Debt Security (which may include information with respect to applicable current foreign exchange controls) is a
part of this prospectus and prospectus supplement or term sheet. Any information concerning exchange rates is furnished as a matter of information only and should not be regarded as indicative of the
range of or trends in fluctuations in currency exchange rates that may occur in the future.
Currencies
We may offer Foreign Currency Debt Securities denominated and/or payable in a specified currency or specified currencies. Unless otherwise
indicated in the applicable prospectus supplement or term sheet, purchasers are required to pay for Foreign Currency Debt Securities in the specified currency. At the present time, there are limited
facilities in the United States for conversion of U.S. dollars into specified currencies and vice versa, and banks may elect not to offer non-U.S. dollar checking or savings account facilities in the
United States. However, if requested on or prior to the fifth Business Day preceding the date of delivery of the Foreign Currency Debt Securities, or by such other day as determined by the agent who
presents such offer to purchase Foreign Currency Debt Securities to us, such agent may be prepared to arrange for the conversion of U.S. dollars into the specified currency set forth in the applicable
prospectus supplement or term sheet to enable the purchasers to pay for the Foreign Currency Debt Securities. Each such conversion will be made by the agents on such terms and subject to such
conditions, limitations and charges as the agents may from
time to time establish in accordance with their regular foreign exchange practices. All costs of exchange will be borne by the purchasers of the Foreign Currency Debt Securities.
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Information
about the specified currency in which a particular Foreign Currency Debt Security is denominated and/or payable, including historical exchange rates and a description of the
currency and any exchange controls, will be set forth in the applicable prospectus supplement or term sheet.
Payment of Principal and Interest
The principal of, premium, if any, and interest on Foreign Currency Debt Securities are payable by us in the specified currency. Currently,
banks do not generally offer non-U.S. dollar-denominated account facilities in their offices in the United States, although they are permitted to do so. Accordingly, a holder of Foreign Currency Debt
Securities will be paid in U.S. dollars converted from the specified currency unless the holder is entitled to elect, and does elect, to be paid in the specified currency, or as otherwise specified in
the applicable prospectus supplement or term sheet.
Any
U.S. dollar amount to be received by a holder of a Foreign Currency Debt Security will be based on the highest bid quotation in The City of New York received by an agent for us
specified in the applicable prospectus supplement or term sheet (the "Exchange Rate Agent") at approximately 11:00 A.M., New York City time, on the second Business Day preceding the applicable
payment date from three recognized foreign exchange dealers (one of whom may be the Exchange Rate Agent) selected by the Exchange Rate Agent and approved by us for the purchase by the quoting dealer
of the specified currency for U.S. dollars for settlement on the payment date in the aggregate amount of the specified currency payable to all holders of Foreign Currency Debt Securities scheduled to
receive U.S. dollar payments and at which the applicable dealer commits to execute a contract. If three bid quotations are not available, payments will be made in the specified currency. All currency
exchange costs will be borne by the holder of the Foreign Currency Debt Security by deductions from such payments.
Unless
otherwise indicated in the applicable prospectus supplement or term sheet, a holder of Foreign Currency Debt Securities may elect to receive payment of the principal of, and
premium, if any, and interest on the Foreign Currency Debt Securities in the specified currency by transmitting a written request for such payment to the corporate trust office of the trustee in The
City of New York on or
prior to the regular record date or at least fifteen calendar days prior to Maturity Date, as the case may be. This request may be in writing (mailed or hand delivered) or sent by cable, telex or
other form of facsimile transmission. A holder of a Foreign Currency Debt Security may elect to receive payment in the specified currency for all principal, premium, if any, and interest payments and
need not file a separate election for each payment. This election will remain in effect until revoked by written notice to the trustee, but written notice of any revocation must be received by
the trustee on or prior to the regular record date or at least fifteen calendar days prior to the Maturity Date, as the case may be. Holders of Foreign Currency Debt Securities whose debt securities
are to be held in the name of a broker or nominee should contact their brokers or nominees to determine whether and how an election to receive payments in the specified currency may be made.
Unless
otherwise specified in the applicable prospectus supplement or term sheet, if the specified currency is other than U.S. dollars, a beneficial owner of the related global security
who elects to receive payments of principal, premium, if any, and/or interest, if any, in the specified currency must notify its participant through which it owns its beneficial interest on or prior
to the applicable record date or at least fifteen calendar days prior to the Maturity Date, as the case may be, of such beneficial owner's election. The participant must notify the depositary of such
election on or prior to the third Business Day after such record date or at least 12 calendar days prior to the Maturity Date, as the case may be, and the depositary will notify the trustee of such
election on or prior to the fifth Business Day after such record date or at least ten calendar days prior to the Maturity Date, as the case may be. If complete instructions are received by the
participant from the beneficial owner and forwarded by the participant to the depositary, and by the depositary to the trustee, on or prior to such dates, then the
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beneficial
owner will receive payments in the specified currency. See "Description of Debt SecuritiesGlobal Securities" in the accompanying prospectus.
Principal
and interest on Foreign Currency Debt Securities paid in U.S. dollars will be paid in the manner specified in the accompanying prospectus supplement or term sheet and this
prospectus with respect to debt securities denominated in U.S. dollars. Interest on Foreign Currency Debt Securities paid in the specified currency will be paid by check mailed on an Interest Payment
Date other than a Maturity Date to the persons entitled thereto to the addresses of such holders as they appear in the security register or, at our option, by wire transfer to a bank account
maintained by the holder in the country of the specified currency. The principal of, premium, if any, and interest on Foreign Currency Debt Securities, together with interest accrued and unpaid
thereon, due on the Maturity Date will be paid, in the specified currency in immediately available funds upon surrender of such debt securities at the corporate trust office of the trustee in The City
of New York, or, at our option, by wire transfer to such bank account of immediately available funds to an account with a bank designated at least 15 calendar days prior to the Maturity Date by the
applicable registered holder, provided the particular bank has appropriate facilities to make these payments and the particular Foreign Currency Debt Security is presented and surrendered at the
office or agency maintained by us for this purpose in the Borough of Manhattan, The City of New York, in time for the trustee to make these payments in accordance with its normal procedures.
Payment Currency
If a specified currency is not available for the payment of principal, premium or interest with respect to a Foreign Currency Debt Security due
to the imposition of exchange controls or other circumstances beyond our control, we will be entitled to satisfy our obligations to holders of Foreign Currency Debt Securities by making such payment
in U.S. dollars on the basis of the noon buying rate in The City of New York for cable transfers of the specified currency as certified for customs purposes (or, if not so certified, as otherwise
determined) by the Federal Reserve Bank of New York (the "Market Exchange Rate") as computed by the Exchange Rate Agent on the second Business Day prior to such payment or, if not then available, on
the basis of the most recently available Market Exchange Rate or as otherwise indicated in an applicable prospectus supplement or term sheet. Any payment made under these circumstances in U.S. dollars
where the required payment is in a specified currency will not constitute a default under the Indenture with respect to the Debt Securities.
All
determinations referred to above made by the Exchange Rate Agent will be at its sole discretion and will, in the absence of manifest error, be conclusive for all purposes and binding
on the holders of the Foreign Currency Debt Securities.
AS INDICATED ABOVE, AN INVESTMENT IN FOREIGN CURRENCY DEBT SECURITIES OR CURRENCY INDEXED DEBT SECURITIES INVOLVES SUBSTANTIAL RISKS, AND THE EXTENT AND NATURE OF
SUCH RISKS CHANGE CONTINUOUSLY. AS WITH ANY INVESTMENT IN A SECURITY, PROSPECTIVE PURCHASERS SHOULD CONSULT THEIR OWN FINANCIAL AND LEGAL ADVISORS AS TO THE RISKS ENTAILED IN AN INVESTMENT IN FOREIGN
CURRENCY DEBT SECURITIES OR CURRENCY INDEXED DEBT SECURITIES. SUCH DEBT SECURITIES ARE NOT AN APPROPRIATE INVESTMENT FOR PROSPECTIVE PURCHASERS WHO ARE UNSOPHISTICATED WITH RESPECT TO FOREIGN CURRENCY
MATTERS.
PLAN OF DISTRIBUTION
We may sell the offered securities:
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through agents;
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to or through underwriters or dealers;
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directly to other purchasers; or
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through a combination of any of these methods of sale.
Any
underwriters or agents will be identified and their discounts, commissions and other items constituting underwriters' compensation and any securities exchanges on which the
securities are listed will be described in the applicable prospectus supplement or term sheet.
We
(directly or through agents) may sell, and the underwriters may resell, the offered securities in one or more transactions, including negotiated transactions, at a fixed public
offering price or prices, which may be changed, or at market prices prevailing at the time of sale, at prices related to prevailing market prices or at negotiated prices.
In
order to facilitate the offering of the debt securities, the underwriters or agents may engage in transactions that stabilize, maintain or otherwise affect the price of the debt
securities and our common stock. These transactions may include short sales, stabilizing transactions and purchases to cover positions created by short sales. Short sales involve the sale by the
underwriters or agents of a greater number of debt securities than they are required to purchase in the offering. "Covered" short sales are sales made in an amount not greater than the underwriters'
or agents' option to purchase additional debt securities from us in the offering. The underwriters or agents may close out any covered short position by either exercising the option to purchase
additional debt securities or purchasing debt securities in the open market. In determining the source of debt securities to close out the covered short position, the underwriters or agents will
consider, among other things, the price of debt securities available for purchase in the open market as compared to the price at which they may purchase debt securities through the option. "Naked"
short sales are sales in excess of the option. The underwriters or agents must close out any naked short position by purchasing debt securities in open market. A
naked short position is more likely to be created if the underwriters or agents are concerned that there may be a downward pressure on the price of the debt securities in the open market after pricing
that could adversely affect investors who purchase in the offering. Stabilizing transactions consist of certain bids for or purchases of the debt securities made by the underwriters or agents in the
open market prior to the completion of the offering. Any of these activities may stabilize or maintain the market price of the debt securities above independent market levels. The underwriters or
agents are not required to engage in these activities, and may end any of these activities at any time.
In
connection with the sale of offered securities, the underwriters or agents may receive compensation from us or from purchasers of the offered securities for whom they may act as
agents. The underwriters may sell offered securities to or through dealers, who may also receive compensation from purchasers of the offered securities for whom they may act as agents. Compensation
may be in the form of discounts, concessions or commissions. Underwriters, dealers and agents that participate in the distribution of the offered securities may be underwriters as defined in the
Securities Act of 1933 (the "Act"), and any discounts or commissions received by them from us and any profit on the resale of the offered securities by them may be treated as underwriting discounts
and commissions under the Act.
We
will indemnify the underwriters and agents against certain civil liabilities, including liabilities under the Act, or contribute to payments they may be required to make in respect of
such liabilities.
Underwriters,
dealers and agents may engage in transactions with, or perform services for, us or our affiliates in the ordinary course of their businesses.
If
so indicated in the prospectus supplement or term sheet relating to a particular series or issue of offered securities, we will authorize underwriters, dealers or agents to solicit
offers by certain institutions to purchase the offered securities from us under delayed delivery contracts providing for payment and delivery at a future date. These contracts will be subject only to
those conditions set forth
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in
the prospectus supplement or term sheet, and the prospectus supplement or term sheet will set forth the commission payable for solicitation of these contracts.
LEGAL MATTERS
The validity of the Holdings and AAM Inc. securities will be passed upon for us by Shearman & Sterling LLP, 599 Lexington
Avenue, New York, New York 10022. David E. Barnes, who is General Counsel of Holdings and AAM Inc., will give us an opinion about the validity of the guarantees by the Subsidiary Guarantors.
Mr. Barnes owns Holdings common stock.
EXPERTS
The consolidated financial statements, and the related financial statement schedule, incorporated in this prospectus by reference from Holdings'
Annual Report on Form 10-K, and the effectiveness of Holdings' internal control over financial reporting have been audited by Deloitte & Touche LLP, an independent registered
public accounting firm, as stated in their report, which is incorporated herein by reference. Such consolidated financial statements and financial statement schedule have been so incorporated in
reliance upon the report of such firm given upon their authority as experts in accounting and auditing.
The
consolidated financial statements, and the related financial statement schedule, of MPG as of and for the year ended December 31, 2016, incorporated in this prospectus by
reference from Item 9.01 of the Current Report on Form 8-K/A filed by Holdings on March 6, 2017, and the effectiveness of MPG's internal control over financial reporting as of
December 31, 2016, have been audited by Deloitte & Touche LLP, an independent registered public accounting firm, as stated in their reports, which are incorporated herein by
reference. Such consolidated financial statements and financial statement schedule have been so incorporated in reliance upon the report of such firm given upon their authority as experts in
accounting and auditing.
The
consolidated balance sheet of MPG and its subsidiaries as of December 31, 2015, and the related consolidated statements of operations, comprehensive income, stockholders'
equity (deficit), and cash flows for each of the years in the two-year period ended December 31, 2015, and the related financial statement schedule for each of the years in the two-year period
ended December 31, 2015, incorporated by reference in Holdings' Current Report on Form 8-K/A, have been incorporated by reference in this prospectus in reliance upon the report of
KPMG LLP, an independent registered public accounting firm, incorporated by reference herein and upon the authority of said firm as experts in accounting and auditing.
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15,000,000 Shares
American Axle Manufacturing Holdings, Inc.
Common Stock
PROSPECTUS SUPPLEMENT
November , 2017
Grafico Azioni American Axle and Manufa... (NYSE:AXL)
Storico
Da Giu 2024 a Lug 2024
Grafico Azioni American Axle and Manufa... (NYSE:AXL)
Storico
Da Lug 2023 a Lug 2024