> _`ab l \pThe Free Software Foundation B=PF0*8X@"1 Helvetica1Courier1Courier New1Courier New1 Helvetica$#,##0_);($#,##0)$#,##0_);[Red]($#,##0)$#,##0.00_);($#,##0.00)$#,##0.00_);[Red]($#,##0.00)-**_($* #,##0_);_($* (#,##0);_($* "-"_);_(@_)*)'_(* #,##0_);_(* (#,##0);_(* "-"_);_(@_)5,2_($* #,##0.00_);_($* (#,##0.00);_($* "-"??_);_(@_)2+/_(* #,##0.00_);_(* (#,##0.00);_(* "-"??_);_(@_)2$#,##0.00;[Red]$#,##0.003$#,##0.00;[Red]($#,##0.00)4$#,##0;[Red]($#,##00)50.00%;[Red](0.00%)60%;[Red](0%)7#,##0.00;[Red](#,##0.00)8#,##0;[Red](#,##0) + ) , * Ј ~~ ؈ ~~#؈ ~~"؈ ~~8"܈ ~~ ؈ ~~9"܈ ~~4#܈ ~~8#܈ ~~3#܈ ~~7#܈ ~~9#܈ ~~83ffff̙̙3f3fff3f3f33333f33&FALLISON TRANSMISSION HOLDINGS I&ALLISON TRANSMISSION HOLDIN (1)INDEX&35Condensed Consolidated Balance &B[Condensed Consolidated Statemen&&~Condensed Consolidated Stat (1)&Recently Issued Accounting Pron&ڲRecently Issued Accounting (1)&mRecently Issued Accounting (2)&<Recently Issued Accounting (3)K
Interest RateInterest Rate (1)6'Interest Rate (2)2Interest Rate (3)DInterest Rate (4)SInterest Rate (5)cInterest Rate (6)MvInterest Rate (7)Interest Rate (8)Interest Rate (9)|Interest Rate (10)%Claims Disputes and Litigation&DThird Quarter Net Sales by End $< 20 NonGAAP Financial Measures&/Comparison of three months ende&"N24 Comparison of nine months en&l26 Liquidity and Capital ResourwInterest Rate Risk&aItem 2 Unregistered Sales of Eq33 Item 6 Exhibits
l y
dMbP?_*+%,&٭e2?'٭e2?(٭e2?)٭e2?",D/??!ALLISON TRANSMISSION HOLDIN (1)INDEX!Condensed Consolidated Balance !Condensed Consolidated Statemen!Condensed Consolidated Stat (1)!Recently Issued Accounting Pron!Recently Issued Accounting (1)!Recently Issued Accounting (2)!Recently Issued Accounting (3)
Interest RateInterest Rate (1)Interest Rate (2)Interest Rate (3)Interest Rate (4)Interest Rate (5)Interest Rate (6)Interest Rate (7)Interest Rate (8)Interest Rate (9)Interest Rate (10) Claims Disputes and Litigation!Third Quarter Net Sales by End 20 NonGAAP Financial Measures!Comparison of three months ende!24 Comparison of nine months en!26 Liquidity and Capital ResourInterest Rate Risk!Item 2 Unregistered Sales of Eq33 Item 6 ExhibitsU }0}$ }$
)!Allison Transmission Holdings Inc10-Q
10/31/2017+#ALLISON TRANSMISSION HOLDINGS, INC. Delaware
26-0414014
(State of Incorporation)
(I.R.S. EmployerIdentification Number)
One Allison Way
~
:Indianapolis, IN0((Address of Principal Executive Offices)
(Zip Code)$____________________________1)Created by Morningstar Document Research.0(http://documentresearch.morningstar.com/.rfZN*nV!o=PF0*8X>
@
l
dMbP?_*+%,&٭e2?'٭e2?(٭e2?)٭e2?",D/??!ALLISON TRANSMISSION HOLDINGS IINDEX!Condensed Consolidated Balance !Condensed Consolidated Statemen!Condensed Consolidated Stat (1)!Recently Issued Accounting Pron!Recently Issued Accounting (1)!Recently Issued Accounting (2)!Recently Issued Accounting (3)
Interest RateInterest Rate (1)Interest Rate (2)Interest Rate (3)Interest Rate (4)Interest Rate (5)Interest Rate (6)Interest Rate (7)Interest Rate (8)Interest Rate (9)Interest Rate (10) Claims Disputes and Litigation!Third Quarter Net Sales by End 20 NonGAAP Financial Measures!Comparison of three months ende!24 Comparison of nine months en!26 Liquidity and Capital ResourInterest Rate Risk!Item 2 Unregistered Sales of Eq33 Item 6 ExhibitsU }U}$ }8}$ }}$ }$
)!Allison Transmission Holdings Inc10-Q
10/31/2017+#ALLISON TRANSMISSION HOLDINGS, INC. Large accelerated filer ? Accelerated filer ?
Non-accelerated filer7/? (Do not check if a smaller reporting company)!Smaller reporting company ?
Emerging growth company
?$____________________________1)Created by Morningstar Document Research.0(http://documentresearch.morningstar.com/*'hrfZN|Lj=PF0*8X>
@
l 2.4
dMbP?_*+%,&٭e2?'٭e2?(٭e2?)٭e2?",D/??!ALLISON TRANSMISSION HOLDINGS I!ALLISON TRANSMISSION HOLDIN (1)!Condensed Consolidated Balance !Condensed Consolidated Statemen!Condensed Consolidated Stat (1)!Recently Issued Accounting Pron!Recently Issued Accounting (1)!Recently Issued Accounting (2)!Recently Issued Accounting (3)
Interest RateInterest Rate (1)Interest Rate (2)Interest Rate (3)Interest Rate (4)Interest Rate (5)Interest Rate (6)Interest Rate (7)Interest Rate (8)Interest Rate (9)Interest Rate (10) Claims Disputes and Litigation!Third Quarter Net Sales by End 20 NonGAAP Financial Measures!Comparison of three months ende!24 Comparison of nine months en!26 Liquidity and Capital ResourInterest Rate Risk!Item 2 Unregistered Sales of Eq33 Item 6 ExhibitsU }y
}$ }:}$ }}$
2
)!Allison Transmission Holdings Inc10-Q
10/31/2017
INDEX Page
%
PART I. FINANCIAL INFORMATION
Item 1.Financial Statements2-18
-%Condensed Consolidated Balance Sheets~
,$Condensed Consolidated Statements of~
Comprehensive Income,$Condensed Consolidated Statements of~
Cash Flows1)Notes to Condensed Consolidated Financial5-18
StatementsItem 2.,$Management?s Discussion and Analysis
19-2980of Financial Condition and Results of OperationsItem 3.0(Quantitative and Qualitative Disclosures
30-31About Market RiskItem 4.Controls and Procedures~
DE
lxl[7%O+_ !"#$%&'()*+,-./01 !!"!PART II. OTHER INFORMATION!!!!"""#Item 1.##Legal Proceedings##~
##$$$%Item 1A.%%Risk Factors%%~
%%&&&'Item 2.'/''Unregistered Sales of Equity Securities''~
''(((and Use of Proceeds)))*Item 6.**Exhibits**~
**+++,,,
Signatures,,~
,,-.$/____________________________10)Created by Morningstar Document Research.01(http://documentresearch.morningstar.com/(TnJN*oKbVJ"=PF0*8X>
@"1100//
l HGWqZ
dMbP?_*+%,&٭e2?'٭e2?(٭e2?)٭e2?",D/??!ALLISON TRANSMISSION HOLDINGS I!ALLISON TRANSMISSION HOLDIN (1)INDEX!Condensed Consolidated Statemen!Condensed Consolidated Stat (1)!Recently Issued Accounting Pron!Recently Issued Accounting (1)!Recently Issued Accounting (2)!Recently Issued Accounting (3)
Interest RateInterest Rate (1)Interest Rate (2)Interest Rate (3)Interest Rate (4)Interest Rate (5)Interest Rate (6)Interest Rate (7)Interest Rate (8)Interest Rate (9)Interest Rate (10) Claims Disputes and Litigation!Third Quarter Net Sales by End 20 NonGAAP Financial Measures!Comparison of three months ende!24 Comparison of nine months en!26 Liquidity and Capital ResourInterest Rate Risk!Item 2 Unregistered Sales of Eq33 Item 6 ExhibitsU }7}$ }U}$ }U}$
H
)!Allison Transmission Holdings Inc10-Q
10/31/2017-%Condensed Consolidated Balance Sheets
September 30, December 31,
~
~
ASSETSCurrent Assets!
Cash and cash equivalents
~
J
~
6
Accounts receivable~
>~
Inventories~
r~
Other current assets~
r~
RTotal Current Assets~
f
~
*"Property, plant and equipment, net~
"~
BIntangible assets, net~
^~
jGoodwill~
V~
V Other non-current assets~
b~
bTOTAL ASSETS~
B~
ALIABILITIESCurrent LiabilitiesAccounts payable~
~
"Product warranty liability~
Z~
fD
lpdXLs';GHX4LE ! " # $ % & ' ( ) * + , - . / 0 1 2 3 4 5 6 7 8 9 : ; < = > ? ) !Current portion of long-term debt ~
2 ~
2 !Deferred revenue!!~
!!!!~
!n!!"Other current liabilities""~
""""~
"Z"#########!$Total Current Liabilities$$~
$$$$~
$Z$%%%"&Product warranty liability&&~
&n&&&~
&&'Deferred revenue''~
'.'''~
'
'(Long-term debt((~
('(((~
(!()Deferred income taxes))~
)&)))~
))%*Other non-current liabilities**~
****~
**+++++++++,TOTAL LIABILITIES,,~
,9,,,~
,
1,/-'Commitments and contingencies (see NOTE--------
.N)///0STOCKHOLDERS? EQUITY0000000041,Common stock, $0.01 par value, 1,880,000,00011~
1111~
1
1-2%shares authorized, 142,735,480 shares.3&issued and outstanding and 163,795,60434+shares issued and outstanding, respectively15)Non-voting common stock, $0.01 par value,55 5?555 5?516)20,000,000 shares authorized, none issued7and outstanding58-Preferred stock, $0.01 par value, 100,000,00088 8?888 8?869.shares authorized, none issued and outstanding:Paid in capital::~
:Z:::~
::;Accumulated deficit;;~
;";;;~
;;-<%Accumulated other comprehensive loss,<<~
<2<<<~
<<=
net of tax>>>>>>>>>"?TOTAL STOCKHOLDERS? EQUITY??~
????~
??DlofqMC@G3%Kd@ A B C D E F G @@@@@@@@@0A(TOTAL LIABILITIES & STOCKHOLDERS? EQUITYA~
ABAA~
AAABBBBBBBBBCD$E____________________________1F)Created by Morningstar Document Research.0G(http://documentresearch.morningstar.com/h=PF0*8X>
@zGGFFEEAAAA
l +v|
dMbP?_*+%,&٭e2?'٭e2?(٭e2?)٭e2?",D/??!ALLISON TRANSMISSION HOLDINGS I!ALLISON TRANSMISSION HOLDIN (1)INDEX!Condensed Consolidated Balance !Condensed Consolidated Stat (1)!Recently Issued Accounting Pron!Recently Issued Accounting (1)!Recently Issued Accounting (2)!Recently Issued Accounting (3)
Interest RateInterest Rate (1)Interest Rate (2)Interest Rate (3)Interest Rate (4)Interest Rate (5)Interest Rate (6)Interest Rate (7)Interest Rate (8)Interest Rate (9)Interest Rate (10) Claims Disputes and Litigation!Third Quarter Net Sales by End 20 NonGAAP Financial Measures!Comparison of three months ende!24 Comparison of nine months en!26 Liquidity and Capital ResourInterest Rate Risk!Item 2 Unregistered Sales of Eq33 Item 6 ExhibitsU }7}$ }U}$ }U}
$ }U}$ }U}$
+
)!Allison Transmission Holdings Inc10-Q
10/31/2017A9Condensed Consolidated Statements of Comprehensive Income
( Three months ended September 30, '
Nine months ended September 30,
~
~
~
~
Net sales~
N ~
~
*
~
n
Cost of sales~
~
~
~
V
Gross profit~
~
2
~
.
~
+#Selling, general and administrative~
:~
>
~
~
.&Engineering ? research and development~
j~
V
~
*
~
Operating income~
~
~
2
~
ZInterest expense, net~
~
~
~
6.Expenses related to long-term debt refinancing ?~
?
~
#Other (expense) income, net~
~
~
~
"Income before income taxes~
~
~
~
Income tax expense~
~
~
~
Net income~
~
~
~
j
-%Basic earnings per share attributable?HzG?
(\?
Q?to common stockholders
/'Diluted earnings per share attributable?HzG?
ffffff?
Q?Dl\PD8l5
>Zqqh !"#$%&'()* to common stockholders!!!!!!!!!! !
!!!
!!!+"#Dividends declared per common share""333333?"""333333?"" "
?""
"?"########## #
###
###($ Comprehensive income, net of tax$~
$$$~
$$$ ~
$
$$
~
$r$%%%%%%%%%% %
%%%
%%%&'$(____________________________1))Created by Morningstar Document Research.0*(http://documentresearch.morningstar.com/;o=PF0*8X>
@
!**))(($$$$$$
$$""""""
""
l Dؑ
dMbP?_*+%,&٭e2?'٭e2?(٭e2?)٭e2?",D/??!ALLISON TRANSMISSION HOLDINGS I!ALLISON TRANSMISSION HOLDIN (1)INDEX!Condensed Consolidated Balance !Condensed Consolidated Statemen!Recently Issued Accounting Pron!Recently Issued Accounting (1)!Recently Issued Accounting (2)!Recently Issued Accounting (3)
Interest RateInterest Rate (1)Interest Rate (2)Interest Rate (3)Interest Rate (4)Interest Rate (5)Interest Rate (6)Interest Rate (7)Interest Rate (8)Interest Rate (9)Interest Rate (10) Claims Disputes and Litigation!Third Quarter Net Sales by End 20 NonGAAP Financial Measures!Comparison of three months ende!24 Comparison of nine months en!26 Liquidity and Capital ResourInterest Rate Risk!Item 2 Unregistered Sales of Eq33 Item 6 ExhibitsU }:}$ }$}$ }$}$
D
)!Allison Transmission Holdings Inc10-Q
10/31/20177/Condensed Consolidated Statements of Cash Flows Nine months ended
September 30,~
~
-%CASH FLOWS FROM OPERATING ACTIVITIES:
Net income
~
~
j
.&Adjustments to reconcile net income to2*net cash provided by operating activities:Deferred income taxes~
"~
B)!Amortization of intangible assets~
~
5-Depreciation of property, plant and equipment~
~
-%Unrealized (gain) loss on derivatives~
~
* Stock-based compensation~
"~
0(Amortization of deferred financing costs~
~
6.Expenses related to long-term debt refinancing ?~
.80Excess tax benefit from stock-based compensation ?~
Other~
~
*"Changes in assets and liabilities:Accounts receivable~
~
Inventories~
~
Accounts payable~
~
"$Other assets and liabilities~
~
j1)Net cash provided by operating activities~
~
DlfZNBd{Q; L8', ! " # $ % & ' ( ) * + , - . / 0 1 2 3 4 5 6 7 8 9 : ; < = > ? - %CASH FLOWS FROM INVESTING ACTIVITIES: &!Additions of long-lived assets!!~
!b!!!~
!r!5"-Investments in technology-related initiatives""~
""""~
""#########.$&Net cash used for investing activities$$~
$V$$$~
$n$-%%CASH FLOWS FROM FINANCING ACTIVITIES:%%%%%%%%#&Repurchases of common stock&&~
&&&&~
&^&/''Borrowings on revolving credit facility''~
'~''' '?'/('Repayments on revolving credit facility((~
(((( (?(")Issuance of long-term debt))~
)B)))~
))*Dividend payments**~
****~
**/+'Proceeds from exercise of stock options++~
+:+++~
+&+",Payments on long-term debt,,~
,,,,~
,,-Debt financing fees--~
----~
--2.*Taxes paid related to net share settlement..~
....~
../of equity awards800Excess tax benefit from stock-based compensation00 0?000~
0
0111111111.2&Net cash used for financing activities22~
2222~
22/3'Effect of exchange rate changes on cash33~
3333 3?344444444405(Net increase (decrease) in cash and cash55~
5555~
556equivalents.7&Cash and cash equivalents at beginning77~
76777~
778 of period9999999992:*Cash and cash equivalents at end of period:~
:J::~
::;;;;;;;;;!<Supplemental disclosures:<<<<<<<<=
Interest paid=~
===~
==>Income taxes paid>~
>>>~
>*>?DloDB&pXK^ZC,>T@ A B C @$A____________________________1B)Created by Morningstar Document Research.0C(http://documentresearch.morningstar.com/<=PF0*8X>
@zCCBBAA>>>>====::::
l
dMbP?_*+%,&٭e2?'٭e2?(٭e2?)٭e2?",D/??!ALLISON TRANSMISSION HOLDINGS I!ALLISON TRANSMISSION HOLDIN (1)INDEX!Condensed Consolidated Balance !Condensed Consolidated Statemen!Condensed Consolidated Stat (1)!Recently Issued Accounting (1)!Recently Issued Accounting (2)!Recently Issued Accounting (3)
Interest RateInterest Rate (1)Interest Rate (2)Interest Rate (3)Interest Rate (4)Interest Rate (5)Interest Rate (6)Interest Rate (7)Interest Rate (8)Interest Rate (9)Interest Rate (10) Claims Disputes and Litigation!Third Quarter Net Sales by End 20 NonGAAP Financial Measures!Comparison of three months ende!24 Comparison of nine months en!26 Liquidity and Capital ResourInterest Rate Risk!Item 2 Unregistered Sales of Eq33 Item 6 ExhibitsU }<(}$ }}$ }}$
)!Allison Transmission Holdings Inc10-Q
10/31/20171)Recently Issued Accounting Pronouncements
September 30, December 31,
~
~
)!Purchased parts and raw materials~
"~
Work in progress~
"~
Service parts
~
~
Finished goods~
z~
VTotal inventories~
r~
$____________________________1)Created by Morningstar Document Research.0(http://documentresearch.morningstar.com/2l`THo#*/Z=PF0*8X>
@Z
l
dMbP?_*+%,&٭e2?'٭e2?(٭e2?)٭e2?",D/??!ALLISON TRANSMISSION HOLDINGS I!ALLISON TRANSMISSION HOLDIN (1)INDEX!Condensed Consolidated Balance !Condensed Consolidated Statemen!Condensed Consolidated Stat (1)!Recently Issued Accounting Pron!Recently Issued Accounting (2)!Recently Issued Accounting (3)
Interest RateInterest Rate (1)Interest Rate (2)Interest Rate (3)Interest Rate (4)Interest Rate (5)Interest Rate (6)Interest Rate (7)Interest Rate (8)Interest Rate (9)Interest Rate (10) Claims Disputes and Litigation!Third Quarter Net Sales by End 20 NonGAAP Financial Measures!Comparison of three months ende!24 Comparison of nine months en!26 Liquidity and Capital ResourInterest Rate Risk!Item 2 Unregistered Sales of Eq33 Item 6 ExhibitsU }*}$ }$}$ }U}
$ }$}$ }$}$ }U}$ }$}$
)!Allison Transmission Holdings Inc10-Q
10/31/20171)Recently Issued Accounting Pronouncements
September 30, 2017
December 31, 2016
Intangible
Accumulated
Intangible
Intangible
Accumulated
Intangible
assets, grossamortization
assets, net
assets, grossamortizationassets, net Other intangible assets:
Trade name
~
Z
$?
~
Z
~
Z
$?
~
Z
( Customer relationships ? defense~
~
n
~
f
~
~
v~
n+#Customer relationships ? commercial~
~
:
~
:
~
~
~
Proprietary technology~
r~
~
j
~
r~
j~
Non-compete agreement~
F~
?
~
F~
~
%Patented technology ? defense~
r~
?
~
r~
?Tooling rights~
~
?
~
~
?
Total~
"~
~
^
~
"~
~
j
$____________________________1)Created by Morningstar Document Research.0(http://documentresearch.morningstar.com/<l`THc%r$A =PF0*8X>
@
l
dMbP?_*+%,&٭e2?'٭e2?(٭e2?)٭e2?",D/??!ALLISON TRANSMISSION HOLDINGS I!ALLISON TRANSMISSION HOLDIN (1)INDEX!Condensed Consolidated Balance !Condensed Consolidated Statemen!Condensed Consolidated Stat (1)!Recently Issued Accounting Pron!Recently Issued Accounting (1)!Recently Issued Accounting (3)
Interest RateInterest Rate (1)Interest Rate (2)Interest Rate (3)Interest Rate (4)Interest Rate (5)Interest Rate (6)Interest Rate (7)Interest Rate (8)Interest Rate (9)Interest Rate (10) Claims Disputes and Litigation!Third Quarter Net Sales by End 20 NonGAAP Financial Measures!Comparison of three months ende!24 Comparison of nine months en!26 Liquidity and Capital ResourInterest Rate Risk!Item 2 Unregistered Sales of Eq33 Item 6 ExhibitsU }'}$ }$}$ }$}
$ }U}$ }U}$ }$}$ }$}$
)!Allison Transmission Holdings Inc10-Q
10/31/20171)Recently Issued Accounting Pronouncements
% Fair Value Measurements Using
Quoted Prices in Active
Significant Other
TOTAL
Markets for Identical #
Observable Inputs (Level 2)Assets (Level 1)
September 30,
December 31,
September 30,
December 31,
September 30,
December 31,
~
~
~
~
~
~
Rabbi trust assets~
"~
$?
$?~
"~
( Deferred compensation obligation~
~
?
?~
~
Cash equivalents ?~
F
?
? ?~
F%Available-for-sale securities ?~
?
? ?~
#Derivative liabilities, net ? ?
~
~
~
~
Total
$?~
N ~
~
~
~
$____________________________1)Created by Morningstar Document Research.0(http://documentresearch.morningstar.com/<l`TH*~Oki~-=PF0*8X>
@"
l `
dMbP?_*+%,&٭e2?'٭e2?(٭e2?)٭e2?",D/??!ALLISON TRANSMISSION HOLDINGS I!ALLISON TRANSMISSION HOLDIN (1)INDEX!Condensed Consolidated Balance !Condensed Consolidated Statemen!Condensed Consolidated Stat (1)!Recently Issued Accounting Pron!Recently Issued Accounting (1)!Recently Issued Accounting (2)
Interest RateInterest Rate (1)Interest Rate (2)Interest Rate (3)Interest Rate (4)Interest Rate (5)Interest Rate (6)Interest Rate (7)Interest Rate (8)Interest Rate (9)Interest Rate (10) Claims Disputes and Litigation!Third Quarter Net Sales by End 20 NonGAAP Financial Measures!Comparison of three months ende!24 Comparison of nine months en!26 Liquidity and Capital ResourInterest Rate Risk!Item 2 Unregistered Sales of Eq33 Item 6 ExhibitsU }a/}$ }
}$ }
}$
)!Allison Transmission Holdings Inc10-Q
10/31/20171)Recently Issued Accounting Pronouncements
September 30, December 31,
~
~
Long-term debt:/'Senior Secured Credit Facility Term B-3~
n~
Loan, variable, due 2022*"Senior Notes, fixed 5.0%, due 2024~
~
+#Senior Notes, fixed 4.75%, due 2027~
B ?Total long-term debt~
N(~
2"-%Less: current maturities of long-term~
2~
2debt%deferred financing costs, net~
~~
v!Total long-term debt, net~
'~
!$____________________________1)Created by Morningstar Document Research.0(http://documentresearch.morningstar.com/>_
0l`THo#)su tdkvN=PF0*8X>
@j
l .o
dMbP?_*+%,&٭e2?'٭e2?(٭e2?)٭e2?",D/??!ALLISON TRANSMISSION HOLDINGS I!ALLISON TRANSMISSION HOLDIN (1)INDEX!Condensed Consolidated Balance !Condensed Consolidated Statemen!Condensed Consolidated Stat (1)!Recently Issued Accounting Pron!Recently Issued Accounting (1)!Recently Issued Accounting (2)!Recently Issued Accounting (3)Interest Rate (1)Interest Rate (2)Interest Rate (3)Interest Rate (4)Interest Rate (5)Interest Rate (6)Interest Rate (7)Interest Rate (8)Interest Rate (9)Interest Rate (10) Claims Disputes and Litigation!Third Quarter Net Sales by End 20 NonGAAP Financial Measures!Comparison of three months ende!24 Comparison of nine months en!26 Liquidity and Capital ResourInterest Rate Risk!Item 2 Unregistered Sales of Eq33 Item 6 ExhibitsU }2}$ }U}$ }$}
$ }U}$ }$}$
.
)!Allison Transmission Holdings Inc10-Q
10/31/2017
Interest Rate
September 30, 2017
December 31, 2016
Notional
Fair Value
Notional
Fair Value
Amount
Amount2*3.44% Interest Rate Swap L, Aug 2016 ? Aug~
.~
~
.
~
2019*2*3.43% Interest Rate Swap M, Aug 2016 ? Aug~
~
~
~
2019*2*3.37% Interest Rate Swap N, Aug 2016 ? Aug~
.~
~
.
~
2019*2*3.19% Interest Rate Swap O, Aug 2016 ? Aug~
.~
~
.
~
2019*2*3.08% Interest Rate Swap P, Aug 2016 ? Aug~
.~
~
.
~
2019*2*2.99% Interest Rate Swap Q, Aug 2016 ? Aug~
~
~
~
2019*2*2.98% Interest Rate Swap R, Aug 2016 ? Aug~
~
~
~
2019*2*2.73% Interest Rate Swap S, Aug 2016 ? Aug~
~
~
~
2019*2*2.74% Interest Rate Swap T, Aug 2016 ? Aug~
.~
~
.
~
2019*2*2.66% Interest Rate Swap U, Aug 2016 ? Aug~
~
~
~
2019*D l|pd!a !"#$%&'()*+,-2 *2.60% Interest Rate Swap V, Aug 2016 ? Aug ~
~
~
~
!2019*2"*2.40% Interest Rate Swap W, Aug 2016 ? Aug""~
"f""" "?"" "
~
"f""
"~
""
#2019*2$*2.25% Interest Rate Swap X, Aug 2016 ? Aug$$~
$$$$~
$$$ $
~
$$$
$~
$$
%2019*&&&&&&&&&& &
&&&
&&&''* includes LIBOR floor of 1.00%'~
'''~
''' ~
'
''
~
''(((((((((( (
(((
((()*$+____________________________1,)Created by Morningstar Document Research.0-(http://documentresearch.morningstar.com/ HEyma9=PF0*8X>
@--,,++''''''
''
l Q&
dMbP?_*+%,&٭e2?'٭e2?(٭e2?)٭e2?",D/??!ALLISON TRANSMISSION HOLDINGS I!ALLISON TRANSMISSION HOLDIN (1)INDEX!Condensed Consolidated Balance !Condensed Consolidated Statemen!Condensed Consolidated Stat (1)!Recently Issued Accounting Pron!Recently Issued Accounting (1)!Recently Issued Accounting (2)!Recently Issued Accounting (3)
Interest RateInterest Rate (2)Interest Rate (3)Interest Rate (4)Interest Rate (5)Interest Rate (6)Interest Rate (7)Interest Rate (8)Interest Rate (9)Interest Rate (10) Claims Disputes and Litigation!Third Quarter Net Sales by End 20 NonGAAP Financial Measures!Comparison of three months ende!24 Comparison of nine months en!26 Liquidity and Capital ResourInterest Rate Risk!Item 2 Unregistered Sales of Eq33 Item 6 ExhibitsU }$4}$ }0}$ }$}
$ }0}$ }U}$
)!Allison Transmission Holdings Inc10-Q
10/31/2017
Interest Rate
September 30, 2017
December 31, 2016
Balance Sheet Location
Fair Value
Balance Sheet Location
Fair Value
-%Derivatives not designated as hedging
instruments:
Interest rate swaps
Other current
~
Other current
~
liabilities
liabilitiesOther non-current~
Other non-current
~
liabilities
liabilities
3+Total derivatives not designated as hedging~
~
instruments
$____________________________1)Created by Morningstar Document Research.0(http://documentresearch.morningstar.com/8B|pd!ET
@j
l )2
dMbP?_*+%,&٭e2?'٭e2?(٭e2?)٭e2?",D/??!ALLISON TRANSMISSION HOLDINGS I!ALLISON TRANSMISSION HOLDIN (1)INDEX!Condensed Consolidated Balance !Condensed Consolidated Statemen!Condensed Consolidated Stat (1)!Recently Issued Accounting Pron!Recently Issued Accounting (1)!Recently Issued Accounting (2)!Recently Issued Accounting (3)
Interest RateInterest Rate (1)Interest Rate (3)Interest Rate (4)Interest Rate (5)Interest Rate (6)Interest Rate (7)Interest Rate (8)Interest Rate (9)Interest Rate (10) Claims Disputes and Litigation!Third Quarter Net Sales by End 20 NonGAAP Financial Measures!Comparison of three months ende!24 Comparison of nine months en!26 Liquidity and Capital ResourInterest Rate Risk!Item 2 Unregistered Sales of Eq33 Item 6 ExhibitsU }$4}$
)!Allison Transmission Holdings Inc10-Q
10/31/2017
Interest Rate
( Three months ended September 30, '
Nine months ended September 30,
~
~
~
~
3+Location of impact on results of operations
Interest expense, net~
~
~
&
~
$____________________________1)Created by Morningstar Document Research.0(http://documentresearch.morningstar.com/(`T|pdajq=PF0*8X>
@j
l C
dMbP?_*+%,&٭e2?'٭e2?(٭e2?)٭e2?",D/??!ALLISON TRANSMISSION HOLDINGS I!ALLISON TRANSMISSION HOLDIN (1)INDEX!Condensed Consolidated Balance !Condensed Consolidated Statemen!Condensed Consolidated Stat (1)!Recently Issued Accounting Pron!Recently Issued Accounting (1)!Recently Issued Accounting (2)!Recently Issued Accounting (3)
Interest RateInterest Rate (1)Interest Rate (2)Interest Rate (4)Interest Rate (5)Interest Rate (6)Interest Rate (7)Interest Rate (8)Interest Rate (9)Interest Rate (10) Claims Disputes and Litigation!Third Quarter Net Sales by End 20 NonGAAP Financial Measures!Comparison of three months ende!24 Comparison of nine months en!26 Liquidity and Capital ResourInterest Rate Risk!Item 2 Unregistered Sales of Eq33 Item 6 ExhibitsU }0.}$ }$}$ }$}
$ }U}$ }U}$
)!Allison Transmission Holdings Inc10-Q
10/31/2017
Interest Rate
( Three months ended September 30, '
Nine months ended September 30,
~
~
~
~
Beginning balance~
~
~
~
:Payments~
~
~
~
.
&Increase in liability (warranty issued
~
~
~
6
~
2
during period)$Net adjustments to liability~
~
~
~
Ending balance~
~
~
~
$____________________________1)Created by Morningstar Document Research.0(http://documentresearch.morningstar.com/4|pdaNvjB=PF0*8X>
@
l R
dMbP?_*+%,&٭e2?'٭e2?(٭e2?)٭e2?",D/??!ALLISON TRANSMISSION HOLDINGS I!ALLISON TRANSMISSION HOLDIN (1)INDEX!Condensed Consolidated Balance !Condensed Consolidated Statemen!Condensed Consolidated Stat (1)!Recently Issued Accounting Pron!Recently Issued Accounting (1)!Recently Issued Accounting (2)!Recently Issued Accounting (3)
Interest RateInterest Rate (1)Interest Rate (2)Interest Rate (3)Interest Rate (5)Interest Rate (6)Interest Rate (7)Interest Rate (8)Interest Rate (9)Interest Rate (10) Claims Disputes and Litigation!Third Quarter Net Sales by End 20 NonGAAP Financial Measures!Comparison of three months ende!24 Comparison of nine months en!26 Liquidity and Capital ResourInterest Rate Risk!Item 2 Unregistered Sales of Eq33 Item 6 ExhibitsU }0}$ }$}$ }}
$ }$}$ }$}$
)!Allison Transmission Holdings Inc10-Q
10/31/2017
Interest Rate
( Three months ended September 30, '
Nine months ended September 30,
~
~
~
~
Beginning balance~
~
R ~
z
~
> Increases~
V~
~
~
^
Revenue earned
~
~
~
~
Ending balance~
~
V ~
~
V
$____________________________1)Created by Morningstar Document Research.0(http://documentresearch.morningstar.com/0 |pda!oc=PF0*8X>
@
l b
dMbP?_*+%,&٭e2?'٭e2?(٭e2?)٭e2?",D/??!ALLISON TRANSMISSION HOLDINGS I!ALLISON TRANSMISSION HOLDIN (1)INDEX!Condensed Consolidated Balance !Condensed Consolidated Statemen!Condensed Consolidated Stat (1)!Recently Issued Accounting Pron!Recently Issued Accounting (1)!Recently Issued Accounting (2)!Recently Issued Accounting (3)
Interest RateInterest Rate (1)Interest Rate (2)Interest Rate (3)Interest Rate (4)Interest Rate (6)Interest Rate (7)Interest Rate (8)Interest Rate (9)Interest Rate (10) Claims Disputes and Litigation!Third Quarter Net Sales by End 20 NonGAAP Financial Measures!Comparison of three months ende!24 Comparison of nine months en!26 Liquidity and Capital ResourInterest Rate Risk!Item 2 Unregistered Sales of Eq33 Item 6 ExhibitsU }%}$ }$}$ }$}$
)!Allison Transmission Holdings Inc10-Q
10/31/2017
Interest Rate
As of
As of
September 30,
December 31,~
~
!Payroll and related costs~
~
Sales allowances
~
~
b
Accrued interest payable~
r~
F
Taxes payable~
N~
*!Vendor buyback obligation~
6~
6Derivative liabilities~
.~
.'Defense price reduction reserve~
&~
&Other accruals~
:~
:
Total~
~
Z$____________________________1)Created by Morningstar Document Research.0(http://documentresearch.morningstar.com/<3
|pd9|tnYof=PF0*8X>
@j
l :u
dMbP?_*+%,&٭e2?'٭e2?(٭e2?)٭e2?",D/??!ALLISON TRANSMISSION HOLDINGS I!ALLISON TRANSMISSION HOLDIN (1)INDEX!Condensed Consolidated Balance !Condensed Consolidated Statemen!Condensed Consolidated Stat (1)!Recently Issued Accounting Pron!Recently Issued Accounting (1)!Recently Issued Accounting (2)!Recently Issued Accounting (3)
Interest RateInterest Rate (1)Interest Rate (2)Interest Rate (3)Interest Rate (4)Interest Rate (5)Interest Rate (7)Interest Rate (8)Interest Rate (9)Interest Rate (10) Claims Disputes and Litigation!Third Quarter Net Sales by End 20 NonGAAP Financial Measures!Comparison of three months ende!24 Comparison of nine months en!26 Liquidity and Capital ResourInterest Rate Risk!Item 2 Unregistered Sales of Eq33 Item 6 ExhibitsU }}$ }}$ }}
$ }}$ }}$
)!Allison Transmission Holdings Inc10-Q
10/31/2017
Interest Rate
Pension Plans
Post-retirement Benefits
(
Three months ended September 30,
(
Three months ended September 30,
~
~
~
~
"Net periodic benefit cost:
Service cost
~
~
$?
~
Interest cost~
~
~
~
!Expected return on assets~
~
?
?Prior service cost ? ?
~
~
!Net periodic benefit cost~
~
~
~
$____________________________1)Created by Morningstar Document Research.0(http://documentresearch.morningstar.com/6Q|pdQpL@4=PF0*8X>
@
l
dMbP?_*+%,&٭e2?'٭e2?(٭e2?)٭e2?",D/??!ALLISON TRANSMISSION HOLDINGS I!ALLISON TRANSMISSION HOLDIN (1)INDEX!Condensed Consolidated Balance !Condensed Consolidated Statemen!Condensed Consolidated Stat (1)!Recently Issued Accounting Pron!Recently Issued Accounting (1)!Recently Issued Accounting (2)!Recently Issued Accounting (3)
Interest RateInterest Rate (1)Interest Rate (2)Interest Rate (3)Interest Rate (4)Interest Rate (5)Interest Rate (6)Interest Rate (8)Interest Rate (9)Interest Rate (10) Claims Disputes and Litigation!Third Quarter Net Sales by End 20 NonGAAP Financial Measures!Comparison of three months ende!24 Comparison of nine months en!26 Liquidity and Capital ResourInterest Rate Risk!Item 2 Unregistered Sales of Eq33 Item 6 ExhibitsU }}$ }}$ }}
$ }}$ }}$
)!Allison Transmission Holdings Inc10-Q
10/31/2017
Interest Rate
Pension Plans
Post-retirement Benefits
'
Nine months ended September 30,
'
Nine months ended September 30,
~
~
~
~
"Net periodic benefit cost:
Service cost
~
&
~
&
~
~
Interest cost~
~
~
~
!Expected return on assets~
~
?
?Prior service cost ? ?
~
~
!Net periodic benefit cost~
"~
& ~
~
$____________________________1)Created by Morningstar Document Research.0(http://documentresearch.morningstar.com/6O|pdSrNB6=PF0*8X>
@
l *
dMbP?_*+%,&٭e2?'٭e2?(٭e2?)٭e2?",D/??!ALLISON TRANSMISSION HOLDINGS I!ALLISON TRANSMISSION HOLDIN (1)INDEX!Condensed Consolidated Balance !Condensed Consolidated Statemen!Condensed Consolidated Stat (1)!Recently Issued Accounting Pron!Recently Issued Accounting (1)!Recently Issued Accounting (2)!Recently Issued Accounting (3)
Interest RateInterest Rate (1)Interest Rate (2)Interest Rate (3)Interest Rate (4)Interest Rate (5)Interest Rate (6)Interest Rate (7)Interest Rate (9)Interest Rate (10) Claims Disputes and Litigation!Third Quarter Net Sales by End 20 NonGAAP Financial Measures!Comparison of three months ende!24 Comparison of nine months en!26 Liquidity and Capital ResourInterest Rate Risk!Item 2 Unregistered Sales of Eq33 Item 6 ExhibitsU }I;}$ }$}$ }$}
$ }}$ }}$
*
)!Allison Transmission Holdings Inc10-Q
10/31/2017
Interest Rate
Three months ended
Available-for-
Defined
Foreign
Total
salebenefit
currency
securities
pension items
items
AOCL as of June 30, 2016
~
~
~
~
91Other comprehensive loss before reclassifications ? ?
~
~
&Amounts reclassified from AOCL ?~
?
~
Income tax ? ?
?
?
.&Net current period other comprehensive
$?~
~
$?
(loss) income
%AOCL as of September 30, 2016~
~
~
~
AOCL as of June 30, 2017~
~
~
~
0(Other comprehensive (loss) income before~
?
~
~
reclassifications&Amounts reclassified from AOCL ?~
?
~
Income tax~
?
?
~
Dl|pdV
=q5=qvYi !"#$%&'(). &Net current period other comprehensive
$? ~
~
~
!
(loss) income"""""""""" "
"""
"""%#AOCL as of September 30, 2017#~
###~
### ~
#
##
~
#2#$$$$$$$$$$ $
$$$
$$$%&$'____________________________1()Created by Morningstar Document Research.0)(http://documentresearch.morningstar.com/6Q=PF0*8X>
@2&))((''######
##
l *
dMbP?_*+%,&٭e2?'٭e2?(٭e2?)٭e2?",D/??!ALLISON TRANSMISSION HOLDINGS I!ALLISON TRANSMISSION HOLDIN (1)INDEX!Condensed Consolidated Balance !Condensed Consolidated Statemen!Condensed Consolidated Stat (1)!Recently Issued Accounting Pron!Recently Issued Accounting (1)!Recently Issued Accounting (2)!Recently Issued Accounting (3)
Interest RateInterest Rate (1)Interest Rate (2)Interest Rate (3)Interest Rate (4)Interest Rate (5)Interest Rate (6)Interest Rate (7)Interest Rate (8)Interest Rate (10) Claims Disputes and Litigation!Third Quarter Net Sales by End 20 NonGAAP Financial Measures!Comparison of three months ende!24 Comparison of nine months en!26 Liquidity and Capital ResourInterest Rate Risk!Item 2 Unregistered Sales of Eq33 Item 6 ExhibitsU }I;}$ }$}$ }$}
$ }}$ }}$
*
)!Allison Transmission Holdings Inc10-Q
10/31/2017
Interest Rate
Nine months ended
Available-for-
Defined
Foreign
Total
salebenefit
currency
securities
pension items
items$
AOCL as of December 31, 2015
~
~
~
~
~
91Other comprehensive loss before reclassifications ? ?
~
~
&Amounts reclassified from AOCL ?~
?
~
Income tax ?~
?
~
.&Net current period other comprehensive
$?~
~
~
(loss) income
%AOCL as of September 30, 2016~
~
~
~
$AOCL as of December 31, 2016~
~
~
j
~
0(Other comprehensive (loss) income before~
?
~
:
~
2reclassifications&Amounts reclassified from AOCL ?~
?
~
Income tax~
~
?
~
Dl|pdW8l04hmP` !"#$%&'(). &Net current period other comprehensive ~
~
~
:
~
. !
(loss) income"""""""""" "
"""
"""%#AOCL as of September 30, 2017#~
###~
### ~
#
##
~
#2#$$$$$$$$$$ $
$$$
$$$%&$'____________________________1()Created by Morningstar Document Research.0)(http://documentresearch.morningstar.com/6Q=PF0*8X>
@2&))((''######
##
l +
dMbP?_*+%,&٭e2?'٭e2?(٭e2?)٭e2?",D/??!ALLISON TRANSMISSION HOLDINGS I!ALLISON TRANSMISSION HOLDIN (1)INDEX!Condensed Consolidated Balance !Condensed Consolidated Statemen!Condensed Consolidated Stat (1)!Recently Issued Accounting Pron!Recently Issued Accounting (1)!Recently Issued Accounting (2)!Recently Issued Accounting (3)
Interest RateInterest Rate (1)Interest Rate (2)Interest Rate (3)Interest Rate (4)Interest Rate (5)Interest Rate (6)Interest Rate (7)Interest Rate (8)Interest Rate (9) Claims Disputes and Litigation!Third Quarter Net Sales by End 20 NonGAAP Financial Measures!Comparison of three months ende!24 Comparison of nine months en!26 Liquidity and Capital ResourInterest Rate Risk!Item 2 Unregistered Sales of Eq33 Item 6 ExhibitsU }a/}$ }$}$ }$} $ }
:
+
)!Allison Transmission Holdings Inc10-Q
10/31/2017
Interest Rate
& Amounts reclassified from AOCL 8
0Affected line item in the Condensed Consolidated
AOCL Components
Three months
Three months
*
"Statements of Comprehensive Income
ended
ended
September 30,
September 30,
~
~
/'Amortization of defined benefit pension
items:Prior service cost~
~
Cost of sales
+#Total reclassifications, before tax~
~
"
Income before income taxes
Income tax ? ?
Income tax expense
Total reclassifications~
~
Net of tax
&Amounts reclassified from AOCL
AOCL ComponentsNine monthsNine months 8
0Affected line item in the Condensed Consolidated
ended
ended *
"Statements of Comprehensive Income
September 30,
September 30,~
~
/'Amortization of defined benefit pension
items:Prior service cost~
~
Cost of salesDl|pdJCIvaSL !"#$%&'()*
+!#Total reclassifications, before tax!~
!!!~
!!! "!
Income before income taxes"
Income tax""~
""""~
""" "
Income tax expense########## #
$Total reclassifications$~
$
$$~
$
$$ $
Net of tax%%%%%%%%%% %
&'$(____________________________1))Created by Morningstar Document Research.0*(http://documentresearch.morningstar.com/|+zR=PF0*8X>
@
!**
))
((
$$$$!!!!
l
dMbP?_*+%,&٭e2?'٭e2?(٭e2?)٭e2?",D/??!ALLISON TRANSMISSION HOLDINGS I!ALLISON TRANSMISSION HOLDIN (1)INDEX!Condensed Consolidated Balance !Condensed Consolidated Statemen!Condensed Consolidated Stat (1)!Recently Issued Accounting Pron!Recently Issued Accounting (1)!Recently Issued Accounting (2)!Recently Issued Accounting (3)
Interest RateInterest Rate (1)Interest Rate (2)Interest Rate (3)Interest Rate (4)Interest Rate (5)Interest Rate (6)Interest Rate (7)Interest Rate (8)Interest Rate (9)Interest Rate (10)!Third Quarter Net Sales by End 20 NonGAAP Financial Measures!Comparison of three months ende!24 Comparison of nine months en!26 Liquidity and Capital ResourInterest Rate Risk!Item 2 Unregistered Sales of Eq33 Item 6 ExhibitsU }1}$ }U}$ }U}
$ }U}$ }U}$
)!Allison Transmission Holdings Inc10-Q
10/31/2017( Claims, Disputes, and Litigation
( Three months ended September 30, '
Nine months ended September 30,
~
~
~
~
Net income~
~
~
~
j
/
'Weighted average shares of common stock
~
J
~
~
b
~
outstanding*"Dilutive effect stock-based awards~
~
~
~
1)Diluted weighted average shares of common~
N~
~
f
~
stock outstanding
-%Basic earnings per share attributable?HzG?
(\?
Q?to common stockholders
/'Diluted earnings per share attributable?HzG?
ffffff?
Q?to common stockholders
$____________________________1)Created by Morningstar Document Research.0(http://documentresearch.morningstar.com/BXui]QNASxV~rJ=PF0*8X>
@
l ]
dMbP?_*+%,&٭e2?'٭e2?(٭e2?)٭e2?",D/??!ALLISON TRANSMISSION HOLDINGS I!ALLISON TRANSMISSION HOLDIN (1)INDEX!Condensed Consolidated Balance !Condensed Consolidated Statemen!Condensed Consolidated Stat (1)!Recently Issued Accounting Pron!Recently Issued Accounting (1)!Recently Issued Accounting (2)!Recently Issued Accounting (3)
Interest RateInterest Rate (1)Interest Rate (2)Interest Rate (3)Interest Rate (4)Interest Rate (5)Interest Rate (6)Interest Rate (7)Interest Rate (8)Interest Rate (9)Interest Rate (10) Claims Disputes and Litigation20 NonGAAP Financial Measures!Comparison of three months ende!24 Comparison of nine months en!26 Liquidity and Capital ResourInterest Rate Risk!Item 2 Unregistered Sales of Eq33 Item 6 ExhibitsU }2}$ }$}$ }}
$ }$}$
)!Allison Transmission Holdings Inc10-Q
10/31/2017;3Third Quarter Net Sales by End Market (in millions)
End Market Q3 2017 Q3 2016
% Variance
Net Sales
Net Sales North America On-Highway~
j~
~
j %0(North America Electric Hybrid-Propulsion~
N~
"
~
* %
Systems for Transit Bus!North America Off-Highway~
F~
~
%Defense~
~
f
~
%( Outside North America On-Highway~
f~
:
~
: %)!Outside North America Off-Highway~
:~
~
b %2*Service Parts, Support Equipment and Other~
.~
~
%
Total Net Sales~
N ~
~
%
$____________________________1)Created by Morningstar Document Research.0(http://documentresearch.morningstar.com/:4bVJ>@a0c-yQ=PF0*8X>
@b
l 3"F.
dMbP?_*+%,&٭e2?'٭e2?(٭e2?)٭e2?",D/??!ALLISON TRANSMISSION HOLDINGS I!ALLISON TRANSMISSION HOLDIN (1)INDEX!Condensed Consolidated Balance !Condensed Consolidated Statemen!Condensed Consolidated Stat (1)!Recently Issued Accounting Pron!Recently Issued Accounting (1)!Recently Issued Accounting (2)!Recently Issued Accounting (3)
Interest RateInterest Rate (1)Interest Rate (2)Interest Rate (3)Interest Rate (4)Interest Rate (5)Interest Rate (6)Interest Rate (7)Interest Rate (8)Interest Rate (9)Interest Rate (10) Claims Disputes and Litigation!Third Quarter Net Sales by End !Comparison of three months ende!24 Comparison of nine months en!26 Liquidity and Capital ResourInterest Rate Risk!Item 2 Unregistered Sales of Eq33 Item 6 ExhibitsU }:}$ }$}$}$ }$}$}
$ }U}$}
$ }$}$
3
)!Allison Transmission Holdings Inc10-Q
10/31/2017&20 Non-GAAP Financial Measures
( Three months ended September 30, '
Nine months ended September 30, (
(unaudited, dollars in millions)
~
~
~
~
Net income (GAAP)~
~
~
~
j
plus:
Income tax expense
~
~
j
~
j
~
v
Interest expense, net~
j~
Z
~
:
~
R)!Amortization of intangible assets~
Z~
^
~
~
5-Depreciation of property, plant and equipment~
V~
V
~
~
,$Stock-based compensation expense (a)~
~
~
"
~
1)Dual power inverter module units extended~
?
~
~
coverage (b)2*Unrealized loss (gain) on foreign exchange~
~
~
~
(c)-%Technology-related investment expense ?~
~
~
(d)6.Expenses related to long-term debt refinancing ?~
2
?
~
2(e)4,Unrealized gain on commodity hedge contracts ? ?
?
~
(f))!Stockholder activism expenses (g) ? ?
?
~
"Adjusted EBITDA (Non-GAAP)~
~
^ ~
J
~
Dlwk_S0{ !"#$%&'()*+,-./012 Net sales (GAAP) ~
N ~
~
*
~
n )!!Adjusted EBITDA margin (Non-GAAP)!!!@D@ !%!!!YA@ !%! !
!fffffC@ !%!
!!33333A@ !%"""" "
1#)Net cash provided by operating activities#~
#^##~
### ~
#
##
~
##$(GAAP).%&(Deductions) or additions to reconcile%%%%%%%%% %
%%%
%%%#&to Adjusted free cash flow:&'Additions of long-lived assets''~
''''~
''' '
~
'b''
'~
'r')(!Stockholder activism expenses (g)(( (?((( (?(( (
(?((
(~
((8)0Excess tax benefit from stock-based compensation)) )?)))~
))) )
)?))
)~
))*(h)++++++++++ +
+++
+++*,"Adjusted free cash flow (Non-GAAP),~
,,,~
,,, ~
,
,,
~
,,---------- -
---
---./$0____________________________11)Created by Morningstar Document Research.02(http://documentresearch.morningstar.com/*ihLC:(6+)N|=PF0*8X>
@221100,,,,,,
,,######
##
l %
L_M
dMbP?_*+%,&٭e2?'٭e2?(٭e2?)٭e2?",D/??!ALLISON TRANSMISSION HOLDINGS I!ALLISON TRANSMISSION HOLDIN (1)INDEX!Condensed Consolidated Balance !Condensed Consolidated Statemen!Condensed Consolidated Stat (1)!Recently Issued Accounting Pron!Recently Issued Accounting (1)!Recently Issued Accounting (2)!Recently Issued Accounting (3)
Interest RateInterest Rate (1)Interest Rate (2)Interest Rate (3)Interest Rate (4)Interest Rate (5)Interest Rate (6)Interest Rate (7)Interest Rate (8)Interest Rate (9)Interest Rate (10) Claims Disputes and Litigation!Third Quarter Net Sales by End 20 NonGAAP Financial Measures!24 Comparison of nine months en!26 Liquidity and Capital ResourInterest Rate Risk!Item 2 Unregistered Sales of Eq33 Item 6 ExhibitsU }7}$ }U}$ }U}$}
$ }U}$ }U}$
%
)!Allison Transmission Holdings Inc10-Q
10/31/2017D<Comparison of three months ended September 30, 2017 and 2016
( Three months ended September 30, (
(unaudited, dollars in millions)
~
%
~
%
of net sales
of net sales Net sales~
N ~
% ~
~
%
Cost of sales
~
~
~
~
Gross profit~
~
~
2
~
Operating expenses:
4,Selling, general and administrative expenses~
:~
6
~
>
~
J.&Engineering ? research and development~
j~
~
V
~
Total operating expenses~
~
J
~
~
^
Operating income~
~
~
~
bInterest expense, net~
~
~
~
6.Expenses related to long-term debt refinancing ? ?
~
~
#Other (expense) income, net~
?
~
?
"Income before income taxes~
~
v
~
~
BIncome tax expense~
~
~
~
Net income~
~
N % ~
~
* %
DTlYMA5iW#Cddj,`r !"#$ !$"____________________________1#)Created by Morningstar Document Research.0$(http://documentresearch.morningstar.com/
P=PF0*8X>
@r$$##""
l %jk
dMbP?_*+%,&٭e2?'٭e2?(٭e2?)٭e2?",D/??!ALLISON TRANSMISSION HOLDINGS I!ALLISON TRANSMISSION HOLDIN (1)INDEX!Condensed Consolidated Balance !Condensed Consolidated Statemen!Condensed Consolidated Stat (1)!Recently Issued Accounting Pron!Recently Issued Accounting (1)!Recently Issued Accounting (2)!Recently Issued Accounting (3)
Interest RateInterest Rate (1)Interest Rate (2)Interest Rate (3)Interest Rate (4)Interest Rate (5)Interest Rate (6)Interest Rate (7)Interest Rate (8)Interest Rate (9)Interest Rate (10) Claims Disputes and Litigation!Third Quarter Net Sales by End 20 NonGAAP Financial Measures!Comparison of three months ende!26 Liquidity and Capital ResourInterest Rate Risk!Item 2 Unregistered Sales of Eq33 Item 6 ExhibitsU }7}$ }U}$ }U}$}
$ }U}$ }U}$
%
)!Allison Transmission Holdings Inc10-Q
10/31/2017F>24 Comparison of nine months ended September 30, 2017 and 2016
' Nine months ended September 30, (
(unaudited, dollars in millions)
~
%
~
%
of net sales
of net sales Net sales~
*~
% ~
n
~
%
Cost of sales
~
~
~
V
~
Gross profit~
.
~
~
~
Operating expenses:
4,Selling, general and administrative expenses~
~
>
~
~
F.&Engineering ? research and development~
*~
~
~
Total operating expenses~
~
N
~
~
Z
Operating income~
2~
~
~
Z
~
fInterest expense, net~
~
~
~
6.Expenses related to long-term debt refinancing ? ?
~
~
#Other (expense) income, net~
?
~
?
"Income before income taxes~
~
j
~
~
JIncome tax expense~
~
~
~
Net income~
~
F % ~
j
~
. %
DUlWK?3gV"Bcci+_q !"#$ !$"____________________________1#)Created by Morningstar Document Research.0$(http://documentresearch.morningstar.com/
P=PF0*8X>
@r$$##""
l v
dMbP?_*+%,&٭e2?'٭e2?(٭e2?)٭e2?",D/??!ALLISON TRANSMISSION HOLDINGS I!ALLISON TRANSMISSION HOLDIN (1)INDEX!Condensed Consolidated Balance !Condensed Consolidated Statemen!Condensed Consolidated Stat (1)!Recently Issued Accounting Pron!Recently Issued Accounting (1)!Recently Issued Accounting (2)!Recently Issued Accounting (3)
Interest RateInterest Rate (1)Interest Rate (2)Interest Rate (3)Interest Rate (4)Interest Rate (5)Interest Rate (6)Interest Rate (7)Interest Rate (8)Interest Rate (9)Interest Rate (10) Claims Disputes and Litigation!Third Quarter Net Sales by End 20 NonGAAP Financial Measures!Comparison of three months ende!24 Comparison of nine months enInterest Rate Risk!Item 2 Unregistered Sales of Eq33 Item 6 ExhibitsU }$4}$
)!Allison Transmission Holdings Inc10-Q
10/31/2017*"26 Liquidity and Capital Resources ' Nine months ended September 30, %
Statements of Cash Flows Data
~
~
3+Cash flows provided by operating activities~
~
0(Cash flows used for investing activities~
V~
n0
(Cash flows used for financing activities
~
~
$____________________________1)Created by Morningstar Document Research.0(http://documentresearch.morningstar.com/*hsg[O\=PF0*8X>
@b
l 0
dMbP?_*+%,&٭e2?'٭e2?(٭e2?)٭e2?",D/??!ALLISON TRANSMISSION HOLDINGS I!ALLISON TRANSMISSION HOLDIN (1)INDEX!Condensed Consolidated Balance !Condensed Consolidated Statemen!Condensed Consolidated Stat (1)!Recently Issued Accounting Pron!Recently Issued Accounting (1)!Recently Issued Accounting (2)!Recently Issued Accounting (3)
Interest RateInterest Rate (1)Interest Rate (2)Interest Rate (3)Interest Rate (4)Interest Rate (5)Interest Rate (6)Interest Rate (7)Interest Rate (8)Interest Rate (9)Interest Rate (10) Claims Disputes and Litigation!Third Quarter Net Sales by End 20 NonGAAP Financial Measures!Comparison of three months ende!24 Comparison of nine months en!26 Liquidity and Capital Resour!Item 2 Unregistered Sales of Eq33 Item 6 ExhibitsU }%}$ }}$ }0}
$ } }$
)!Allison Transmission Holdings Inc10-Q
10/31/2017Interest Rate Risk
Counterparty Effective Date Notional
LIBOR Fixed
Amount
Rate
(in millions)Interest Rate Swap L*BarclaysAug 2016-Aug 2019~
.
Q@ %
Interest Rate Swap M*
JP Morgan
Aug 2016-Aug 2019
~
q=
ףp@
%Interest Rate Swap N*Bank of AmericaAug 2016-Aug 2019~
.
(\
@ %Interest Rate Swap O*
Deutsche BankAug 2016-Aug 2019~
.
Q @ %Interest Rate Swap P*BarclaysAug 2016-Aug 2019~
.
p=
ף@ %Interest Rate Swap Q*BarclaysAug 2016-Aug 2019~
Q@ %Interest Rate Swap R*
Deutsche BankAug 2016-Aug 2019~
ףp=
@ %Interest Rate Swap S*
Deutsche BankAug 2016-Aug 2019~
ףp=
@ %Interest Rate Swap T*Bank of AmericaAug 2016-Aug 2019~
.
Q@ %Interest Rate Swap U*Fifth Third BankAug 2016-Aug 2019~
HzG@ %Interest Rate Swap V*Fifth Third BankAug 2016-Aug 2019~
@ %Interest Rate Swap W*Fifth Third BankAug 2016-Aug 2019~
f
333333@ %Interest Rate Swap X*Huntington BankAug 2016-Aug 2019~
@ %'* includes LIBOR floor of 1.00%$____________________________1)Created by Morningstar Document Research.0(http://documentresearch.morningstar.com/Dlwk_/h?xCtpdX0=PF0*8X>
@
l b
dMbP?_*+%,&٭e2?'٭e2?(٭e2?)٭e2?",D/??!ALLISON TRANSMISSION HOLDINGS I!ALLISON TRANSMISSION HOLDIN (1)INDEX!Condensed Consolidated Balance !Condensed Consolidated Statemen!Condensed Consolidated Stat (1)!Recently Issued Accounting Pron!Recently Issued Accounting (1)!Recently Issued Accounting (2)!Recently Issued Accounting (3)
Interest RateInterest Rate (1)Interest Rate (2)Interest Rate (3)Interest Rate (4)Interest Rate (5)Interest Rate (6)Interest Rate (7)Interest Rate (8)Interest Rate (9)Interest Rate (10) Claims Disputes and Litigation!Third Quarter Net Sales by End 20 NonGAAP Financial Measures!Comparison of three months ende!24 Comparison of nine months en!26 Liquidity and Capital ResourInterest Rate Risk33 Item 6 ExhibitsU }'}$ }y}
$ }y}$
)!Allison Transmission Holdings Inc10-Q
10/31/2017KCItem 2. Unregistered Sales of Equity Securities and Use of Proceeds
Total Number
Average Price
Total Number of
Approximate
of Shares
Paid per
Shares
Dollar Value of Purchased
Share
Purchased
Shares that May
as Part of
Yet Be Purchased
Publicly
Under Plans (1)
Announced Plans
or Programs (1)July 1 ? July 31, 2017~
yfffffB@
~
y
~
^'M"August 1 ? August 31, 2017~
rzGA@
~
r
~
q=( September 1 ? September 30, 2017~
B{GzA@
~
B
~
b%&
Total~
{RA@
~
{
$____________________________1)Created by Morningstar Document Research.0(http://documentresearch.morningstar.com/:<RF:.b'e$U}qI=PF0*8X>
@
l F
dMbP?_*+%,&٭e2?'٭e2?(٭e2?)٭e2?",D/??!ALLISON TRANSMISSION HOLDINGS I!ALLISON TRANSMISSION HOLDIN (1)INDEX!Condensed Consolidated Balance !Condensed Consolidated Statemen!Condensed Consolidated Stat (1)!Recently Issued Accounting Pron!Recently Issued Accounting (1)!Recently Issued Accounting (2)!Recently Issued Accounting (3)
Interest RateInterest Rate (1)Interest Rate (2)Interest Rate (3)Interest Rate (4)Interest Rate (5)Interest Rate (6)Interest Rate (7)Interest Rate (8)Interest Rate (9)Interest Rate (10) Claims Disputes and Litigation!Third Quarter Net Sales by End 20 NonGAAP Financial Measures!Comparison of three months ende!24 Comparison of nine months en!26 Liquidity and Capital ResourInterest Rate Risk!Item 2 Unregistered Sales of EqU }I }$ }I;
F
)!Allison Transmission Holdings Inc10-Q
10/31/201733 Item 6. Exhibits Exhibit Description
Numberffffff@2*Indenture, dated as of September 26, 2017,
.
&between Allison Transmission, Inc. and/'Wilmington Trust, National Association,91as Trustee (including form of Note) (incorporated7/by reference to Exhibit 4.1 to the Registrant?s6.Current Report on Form 8-K filed September 26,~
333333$@/'Incremental Facility Joinder Agreement,5-dated as of September 26, 2017, supplementing2*the Amended and Restated Credit Agreement,5-dated as of September 23, 2016, among Allison,$Transmission Holdings, Inc., Allison4,Transmission, Inc., as Borrower, the several.&banks and other financial institutions5-or entities from time to time parties thereto.&as lenders and Citicorp North America,3+Inc., as Administrative Agent (incorporated80by reference to Exhibit 10.1 to the Registrant?s6.Current Report on Form 8-K filed September 26,Dz lvj^:? ~
!!"?@"0"(Certification of Chief Executive Officer##,#$pursuant to Rule 13a-14(a)/15d-14(a)$$1$)as adopted pursuant to Section 302 of the%%3%+Sarbanes-Oxley Act of 2002 (filed herewith)&&'333333?@'0'(Certification of Chief Financial Officer((,($pursuant to Rule 13a-14(a)/15d-14(a)))1))as adopted pursuant to Section 302 of the**3*+Sarbanes-Oxley Act of 2002 (filed herewith)++,@@,1,)Certification of Periodic Report by Chief----%Executive Officer and Chief Financial..3.+Officer pursuant to 18 U.S.C. Section 1350,//1/)as adopted pursuant to Section 906 of the0030+Sarbanes-Oxley Act of 2002 (filed herewith)112101.INS22XBRL Instance Document334101.SCH4/4'XBRL Taxonomy Extension Schema Document556101.CAL646,XBRL Taxonomy Extension Calculation Linkbase777Document889101.DEF939+XBRL Taxonomy Extension Definition Linkbase:::Document;;<101.LAB<.<&XBRL Taxonomy Extension Label Linkbase===Document>>?101.PRE?,?$XBRL Taxonomy Extension PresentationD lp(t">&;F.mA)>@ABCDE@@@Linkbase DocumentAB$C____________________________1D)Created by Morningstar Document Research.0E(http://documentresearch.morningstar.com/Vd=PF0*8X>
@EEDDCC
Root Entry FBook
!"#$%&'()*+,-./0123456789:;<=>?@ABCDEFGHIJKLMNOPQRSTUVWXYZ[\]^_`abcdefghijklmnopqrstuvwxyz{|}~
!"#$%&'()*+,-./0123456789:;<=>?@ABCDEFGHIJKLMNOPQRSTUVWXYZ[\]^