Barloworld Limited · For any credit ratings referenced in this publication, please see the ratings tab on the issuer/entity page on for the most updated credit rating action information

CORPORATES

CREDIT OPINION2 May 2018

New Issue

RATINGS

Barloworld LimitedDomicile South Africa

Long Term Rating Baa3

Type LT Issuer Rating - DomCurr

Outlook Stable

Please see the ratings section at the end of this reportfor more information. The ratings and outlook shownreflect information as of the publication date.

Contacts

Lahlou Meksaoui [email protected]

Dion Bate +971.4.237.9504VP-Senior [email protected]

David G. Staples +971.4.237.9562MD-Corporate [email protected]

CLIENT SERVICES

Americas 1-212-553-1653

Asia Pacific 852-3551-3077

Japan 81-3-5408-4100

EMEA 44-20-7772-5454

Barloworld LimitedUpdate of Key Credit Factors Following Conclusion ofSovereign Review

SummaryOn 27 March 2018, the outlook on Barloworld Limited (Barloworld or the company) Baa3global scale ratings was changed to stable after being placed under review for downgradeon 29 November 2017 following a similar action taken on the Government of SouthAfrica (Baa3 stable) on 23 March 2018. As a result we no longer see Barloworld as beingconstrained by the government of South Africa credit rating.

The Baa3/Aa1.za issuer ratings recognise Barloworld's leading competitive positions in themarkets in which it operates, as well as its strong brand offerings and stable long-termrelationships with its main suppliers. The rating also considers Barloworld's diversifiedproduct mix and its resilient business model, whereby its integrated after-sales supportsegments are able to soften the impact from the decline in new equipment and vehiclesales during cyclical downturns. Barloworld's credit metrics have historically been relativelystable and are supported by the company's ongoing commitment to balanced financialpolicies. While adjusted debt/EBITDA of 1.9x is strongly positioned within the rating category,Barloworld's EBIT/interest expense cover of 3.0x and operating margin of 6.9% are weaklypositioned (as of 30 September 2017 – FY2017) leaving it susceptible to weaker operatingperformance and a rising interest rate environment. Ratings also consider Barloworld's goodliquidity position underpinned by a balanced debt maturity profile.

The rating is constrained by Barloworld's exposure to: (1) the Sub-Saharan African andRussian markets, leaving it exposed to the weak economic conditions of these countries;and (2) more cyclical mining, agricultural, construction and motor related industries, whichare currently experiencing prolonged depressed global commodity prices and weaker localconsumer environments. In addition, Barloworld is exposed to key supplier risk as most of itsoperations depend on its position as the principal agent for a number of high profile brandssuch as Caterpillar Inc. (A3 stable). This is mitigated by its long-term relationships and closestrategic alignment as well as, in some cases, its fixed term contractual agreements with itsprincipals, which we expect to continue.

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MOODY'S INVESTORS SERVICE CORPORATES

Exhibit 1

Credit metrics have remained range bound through the cycle

1.5x

1.7x

1.9x

2.1x

2.3x

2.5x

2.7x

2.9x

3.1x

3.3x

3.5x

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

Debt/ EBITDA EBIT/ Interest expense

Source: Company financials and Moody's Financial Metrics

Credit strengths

» Leading market positions supported by strong brand offerings

» Resilient operating cash flows underpinned by integrated business model and diversified product mix

» Relatively stable credit metrics through the cycle underpinned by balanced financial policies

» Good liquidity profile

Credit challenges

» High exposure to cyclical end markets tied to commodity price volatility and mining industry weakness

» Concentration to Sub-Saharan African and Russian markets currently experiencing challenging economic conditions

» Key supplier risks mitigated by long term relationships and close strategic alignment

» Debt levels and leverage susceptible to seasonal working capital demands

Rating outlookThe stable outlook reflects our expectation that Barloworld will maintain its leading market position across its operations, as well as itsstrong relationships with its key principals. The outlook assumes that management will pursue balanced financial policies resulting inrelatively stable credit metrics over the next 12 to 18 months, and will also maintain a good liquidity profile.

Factors that could lead to an upgradeWe do not expect any further upward rating action as Barloworld's rating is likely to be constrained at the same level as South Africa'sgovernment bond rating given the bulk of Barloworld's cash flows and operational exposure are derived in South Africa and the rest ofAfrica.

Subject to the government of South Africa's bond rating, Moody's would consider an upgrade if Barloworld

» Is able to grow in size and geographic diversification, while maintaining its financial performance under challenging operatingconditions

» Adjusted debt/EBITDA were to fall below 2.0x

This publication does not announce a credit rating action. For any credit ratings referenced in this publication, please see the ratings tab on the issuer/entity page onwww.moodys.com for the most updated credit rating action information and rating history.

2 2 May 2018 Barloworld Limited: Update of Key Credit Factors Following Conclusion of Sovereign Review


» EBIT / interest increases above 4.0x

» A positive and sustainable free cash flow position

Factors that could lead to a downgradePressure on the ratings would develop following

» A downgrade of the government of South Africa's bond rating

» Operating performance were to weaken, to the extent there are revenue and operating margin declines translating into weaker debtprotection measures such that debt / EBITDA rises above 3.0x or its EBIT/ interest expense falls below 2.5x for an extended period oftime

» If the company's liquidity risk profile deteriorates

Key indicators

Exhibit 2

Key Indicators

KEY INDICATORS [1] [2]

Barloworld Limited

9/30/2013 9/30/2014 9/30/2015 9/30/2016 9/30/2017

Revenue (Rand Million) 59,498 62,101 62,720 62,074 61,959

EBIT / Interest Expense 3.0x 3.2x 3.0x 2.9x 3.0x

RCF / Net Debt 39.0% 38.6% 33.2% 35.1% 47.1%

Debt / EBITDA 2.2x 2.2x 2.4x 2.2x 1.9x

[1] All ratios are based on 'Adjusted' financial data and incorporate Moody's Global Standard Adjustments for Non-Financial Corporations.[2] Revenues are related to continuing operations.Source: Moody's Financial Metrics

ProfileBarloworld, headquartered in South Africa, is a leading distributor and after-sales support provider of heavy equipment and motorvehicles for leading international brands across Southern African markets, Russia and Iberia. It also provides integrated rental, fleetmanagement, product support and logistics solutions. The core divisions of the group comprise: (1) Equipment which provides end toend solutions across the value chain on behalf of Caterpillar Inc. to the mining, construction, industrial sectors; (2) automotive whichoperates the motor retail, car rental, and fleet management services; and (3) logistics which provide logistics management transportand supply chain optimisation.

As of FYE ending 30 September 2017 Barloworld reported revenues from continuing operations of ZAR62 billion ($4.6 billion) andreported EBITDA of ZAR6.7 billion ($0.5 billion).



Exhibit 3

Revenue Breakdown per Division (% of total revenues before eliminations)

37.5% 41.5%47.3% 46.8% 43.8%

37.7% 37.8%

9.5%8.2%

4.2% 3.1%3.2%

2.4% 1.2%

35.9% 34.6% 29.4% 30.9% 32.1%35.2% 34.8%

6.7% 6.1%6.8% 7.3% 8.3%

9.6% 10.4%

3.6% 3.9% 4.9% 5.0% 5.4%5.9% 5.8%

6.8% 5.8% 7.4% 7.0% 7.2% 9.3% 10.0%

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

70.0%

80.0%

90.0%

100.0%

2011 2012 2013 2014 2015 2016 2017

Equipment Handling Motor retail Car rental Fleet leasing Logistics

Source: Barloworld annual financial reports

Detailed credit considerationsLeading market positions supported by strong brand offeringsBarloworld holds dominant market positions in heavy machinery, motor vehicle retail, motor vehicle rental and fleet businesses. Thecompany’s leadership positions, strong brand representation and broad customer coverage through its markets provides high barriersof entry given the significant investments involved. While there is some concentration risk associated with its key principal suppliersand limited long term fixed term contracts in place, we take comfort around its long term relationships and close strategic alignmentbetween the parties and its performance of maintaining dominant and stable market positions.

Barloworld has the sole distribution rights for Caterpillar Inc. (CAT or Caterpillar - A3 stable) for sales of heavy equipment/machineryand after sale parts service across Sub-Saharan Africa and Russia (39% of financial year end (FYE) 2017 revenues). The Group has hada long standing relationship with Caterpillar for almost 90 years. Across southern Africa it holds mostly No. 1 market positions in thevarious heavy machinery categories which is supported by a strong dealership network that provides onsite customer support andafter sales service. The distribution agreement awarded by CAT is for an indefinite period in each of the regions although it can beterminated within 6 months. Given the long standing working relationship and close strategic alignment as well as potential disruptionto customers we see no reason why the CAT relationship could be terminated on such short notice and would expect CAT to workclosely with its troubled distributors through product support, as done in other jurisdictions with its other distributors.

Barloworld also holds key distribution rights (but not the sole rights) for 33 premium and volume-led motor brands in South Africawhich represent 70% of the motor brands in South Africa. These include Bayerische Motoren Werke Aktiengesellschaft (BMW,A1 stable), Audi (unrated), Jaguar Land Rover Automotive Plc (Ba1 Stable), Daimler AG (Mercedes-Benz, A2 stable), VolkswagenAktiengesellschaft (VW, A3 Stable), and Toyota Motor Corporation (Aa3 stable) to name a few, which have mature and stable marketshare positions. Through its 42 dealerships Barloworld has maintained around 7% of the total volume sales throughout the SouthAfrican dealer market. Barloworld’s “big box” dealership strategy in high density metropolitan areas enables economies of scale and hasproven to be more resilient to economic downturns.

Within its motor rental operations (10.4% of total FYE2017 revenues) Barloworld holds the Avis and recently acquired Budget brands(Avis Budget Group, Inc. (Ba3 stable)) which combined hold the number 1 market position with 41% of the South African motor rentalmarket. This is compared to its nearest competitor Europcar Tempest with a 28% market share. We view favourably the acquisition ofthe Budget license as it creates greater economies of scale through sharing of infrastructure such as office space and vehicle rental poolwhich should drive higher rental days and vehicle utilisation rates. Furthermore, it broadens Barloworld’s target market entering intothe lower more “budget” conscious customer base.

Avis fleet division, a growing contributor to the Group, (5.8% of total FYE2017 revenues) comprises of in-house brands with a marketshare to approx. 27% of the South African business fleet market. The division has an established customer base comprising of blue chipcompanies and government that are tied into longer term fleet contracts of up to 5 years.



Diversified operations against high exposure to cyclical end marketsBarloworld business profile benefits from its diversified operations which partially offset its exposure to more cyclical end markets suchas mining, and construction industries which are currently experiencing prolonged depressed global commodity prices and weaker localbusiness environments. Its non-commodity linked business lines contribute to 61% of total revenues, offering exposure to industriesthat are less correlated to mining and construction industries, which have resulted in a more stable operating profile.

We anticipate that Barloworld’s heavy equipment unit sales will remain under pressure largely due to the weak commodityfundamentals as miners delay projects, limit capital expenditure and lower operating costs. This is evident in Barloworld’s equipmentorder book which has been declining since the high point in FYE2012 and are currently at similar levels to the low point of FYE2009/10.

Barloworld’s broad customer base and commodity mix reduces its operating risk profile. Within the Equipment southern Africandivision mining represents 30% (29% FYE2016) of new Equipment revenues with construction and power contributing 40% and 14%(52% and 15% FYE2016), respectively. The top 10 customers represents key global mining operators and contribute 63% to Equipmentdivision after sales revenues, with Anglo American plc (Baa3 Stable) the largest customer at 22% of after sales revenues. (machinesales by customer depend on the timing of large mining projects and will vary from period to period). From a commodity exposurewe consider its exposure to commodities to be moderately diversified with its top 3 key exposures to coal, copper and diamonds,representing 49% to total equipment revenues.

High concentration to regions which are experiencing weaker economic conditionsWith close to 81% of revenues derived from South Africa (Baa3, stable), Barloworld is intrinsically linked to the macro-economicenvironment of South Africa. The slowdown in South Africa’s economic growth, low consumer and business confidence and policyuncertainty in the mining sector is creating a challenging operating environment. The rest of Africa contributes to 11% of revenuesand along with operations in Russia (Ba1, positive) which contribute 8% of FYE2017 revenues offers geographic and commoditydiversification but are also facing their own challenges. We recognize Barloworld’s prudent approach to operating in weaker sovereignenvironments as demonstrated by limiting local currency receipts (predominately for African countries outside of South Africa).

Due to the infrastructure backlog in many African countries we see the potential for strong long term demand for Barloworld’sEquipment division, however fiscal and funding challenges are likely to prevail over the short to medium term. Russia with its significantmining territory also offers long term growth opportunities.

Exhibit 4

Regional diversification limited to Southern Africa

71% 71%82% 85% 88% 92% 91%

18% 19%

10% 8% 7%8% 6% 5% 8% 8%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2011 2012 2013 2014 2015 2016 2017

Southern Africa Europe Russia North America Australia

Source: Barloworld annual financial reports

Barloworld’s motor dealership new vehicle sales are under pressure from a weak consumer confidence and high consumerindebtedness. We believe Barloworld is partially insulated given its broad brand offering covering premium and volume led brands aswell as its access to a sizable car parc base of 2.5 million motor vehicles in South Africa which will support its after sales service andparts revenues (15% of motor trading revenues for FYE2017).



Barloworld’s Motor Retail division benefits from having greater price competitive brands relative to imported vehicle brands. This is dueto the largely locally based OEM’s (Original Equipment Manufacturers) which are partially insulated from the currency volatility of theRand.

Resilient operating cash flows underpinned by integrated business modelBarloworld’s operating performance has been relatively resilient through the cycles, particularly post the financial crisis of 2008.This is partly due to its exposures to different industry sectors, geographic diversification and integrated product offerings down thevalue chain. The management of its “assets” across the value chain benefits from (1) obtaining discounts/rebates from OEMs; (2)providing maintenance, parts and related services on sold equipment/vehicles; and (3) a disposal margin which is captured throughits in-house electronic disposal platform. The integrated business model down the value chain provides a strong counterbalance tothe anticipated declines in new equipment and vehicle sales, as companies attempt to extend the lifespan of machinery beyond thetraditional replacement cycle and consumers delay new vehicle purchases.

Exhibit 5

Revenues, EBITDA and margins demonstrate operational resilience through the cycle

50,107 45,269

40,830

49,823 53,415

59,498 62,101 62,720 62,074 61,959

5,366 4,952 3,981 4,859 5,620 6,343 7,196 7,761 7,872 7,883

10.7% 10.9%

9.8% 9.8%9.9% 10.7%

11.6%

12.4%12.7%

12.7%

8.0%

9.0%

10.0%

11.0%

12.0%

13.0%

14.0%

0

10,000

20,000

30,000

40,000

50,000

60,000

70,000

FYE 2008 FYE 2009 FYE 2010 FYE 2011 FYE 2012 FYE 2013 FYE 2014 FYE 2015 FYE 2016 FYE 2017

ZA

R m

illio

n

Revenue Adjusted EBITDA EBITDA Margin

Note: FYE 2012, Barloworld’s revenues were boosted by CAT’s acquisition of Bucyrus which expanded Barloworld’s product offering and profitability.Source: Barloworld annual financial reports and Moody’s

Barloworld has maintained adjusted EBITDA margins around 10% to 12% historically, weakening to 9.8% in FYE 2010 and FYE2011,when the full effect of the financial crisis was felt, but has since improved to 12.7% as of FYE2017 as a result of its higher marginaftermarket services contributions. We do expect performance over the next two to three years to come under pressure largely dueto Barloworld’s exposure to the prolonged depressed commodity cycle and weaker South African economic environment with itsexpected low growth rates (Moody’s forecast of real GDP for 2018 is 1.4% and 2019 is 1.9%). We, however, remain confident that therespective operations will be able to adjust and that management will be responsive to these pressures as historically demonstratedthrough right sizing troubled operations and keeping the business focused on its core competencies. We also expect Barloworld’ssizable, higher margin aftermarket services business to continue to counterbalance the anticipated declines in new equipment andvehicle sales. Over the past 5 years after service and parts revenues in the Equipment division has increased from around 33%(FYE2012) to 57% of total Equipment division revenues.



Exhibit 6

Material Equipment after sales revenue contribution (FYE2017)

33%

56%

8%3%

New equipment Product support Used equipment Rental

Source: Barloworld FYE2017 annual financial report

In addition to leveraging off its large installed equipment/vehicle population management’s strategy over the next two to three yearswill be to optimize its operations through cost efficiencies, right sizing and pursuing growth opportunities in adjacent markets. Weanticipate these strategies will place Barloworld in a stronger position should market conditions and volumes improve given its largelyfixed cost base.

Stable credit metrics supported by balanced financial policiesThe resilience of Barloworld’s diversified business model and balanced approach to financial management policies is furtherdemonstrated through its historically stable credit metrics. Leverage, as measured by adjusted debt/EBITDA, of 1.9x is moderatelypositioned within the rating category but is susceptible to seasonal working capital funding demands to support its after salesbusinesses. We expect leverage to remain relatively stable underpinned by management’s internal target of net debt/ EBITDA of lessthan 2.5x (reported to 30 September 2017: 0.9x). Barloworld’s EBIT/interest cover of 3.0x, although weakly positioned, has historicallybeen around these levels but is expected to come under pressure, particularly given the rising funding cost environment in SouthAfrica. We anticipate overall credit metrics will remain relatively stable despite the challenges Barloworld faces in the current economicenvironment. This will be supported by our expectation that management will maintain its balanced financial policies.

Liquidity analysisBarloworld's liquidity as of September 2017 is considered good whereby Barloworld has sufficient available committed facilities totalingZAR8.2 billion and cash of ZAR3.9 billion to meet debt maturities of ZAR3.8 billion over the next 18 months (until March 2019).Barloworld has an evenly spread debt maturity profile over the next seven years but there is reliance on short term debt (commercialpaper, 365 day notice facilities and on-demand facilities) to fund its working capital needs. Barloworld's split between long term andshort term debt maturities was 79:21 as of 30 September 2017 and will improve as bond and bank debt are refinanced during the year.We will continue to closely monitor Barloworld's liquidity profile, particularly given the seasonality of its working capital.

Barloworld has a track record of regular access to the bond and bank market and as a listed entity is able to raise equity if needed.Barloworld has good headroom under its financial covenants, which include net debt/ EBITDA of less than 3.0x (reported 30 September2017: 0.9x) and EBITDA/interest expense of greater than 3.5x (reported 30 September 2017 5.1x). We expect management to continueto operate within its conservative financial policy framework.



Rating methodology and scorecard factorsThe principal methodology used in rating the company was Moody's Global Retail Industry Methodology (October 2015), as it capturesthe biggest portion of its businesses being the Equipment and Automotive retail and after services operations, representing 74% ofGroup revenues. We also consider the Global Manufacturing Companies Methodology (June 2017) and Equipment and TransportationRental Industry Methodology (December 2014) into our analysis.

Exhibit 7

Rating Factors

Retail Industry Grid [1][2]

Factor 1 : Scale (10%) Measure Score Measure Score

a) Revenue (USD Billion) $4.6 Ba $5.5 Ba

Factor 2 : Business Profile (30%)

a) Stability of Product Ba Ba Ba Ba

b) Execution and Competitive Position Baa Baa Baa Baa

Factor 3 : Leverage and Coverage (45%)

a) EBIT / Interest Expense 3.0x Ba 3x Ba

b) RCF / Net Debt 47.1% A 48% - 52% A

c) Debt / EBITDA 1.9x A 1.8x - 2x A

Factor 4 : Financial Policy (15%)

a) Financial Policy Baa Baa Baa Baa

Rating:

a) Indicated Rating from Grid Baa2 Baa2

b) Actual Rating Assigned Baa3

Current

FY 09/30/2017

Moody's 12-18 Month Forward View

As of 4/23/2018 [3]

[1] All ratios are based on 'Adjusted' financial data and incorporate Moody's Global Standard Adjustments for Non-Financial Corporations. [2] As of 30/09/2017. [3] Revenues are related tocontinuing operations. [4] This represents Moody's forward view; not the view of the issuer; and unless noted in the text, does not incorporate significate acquisitions and divestures.Source: Moody's Financial Metrics

Ratings

Exhibit 8Category Moody's RatingBARLOWORLD LIMITED

Outlook StableIssuer Rating -Dom Curr Baa3NSR Issuer Rating Aa1.zaST Issuer Rating -Dom Curr P-3NSR ST Issuer Rating P-1.za

Source: Moody's Investors Service



Appendix

Exhibit 9

Peer comparison table

(in US millions)

FYE

Sep-16

FYE

Sep-17

LTM

Sep-17

FYE

Dec-16

FYE

Dec-17

LTM

Dec-17

FYE

Dec-16

FYE

Dec-17

LTM

Dec-17

FYE

Dec-16

FYE

Dec-17

LTM

Dec-17

FYE

Jun-16

FYE

Jun-17

LTM

Dec-17

Revenue $4,216 $4,634 $4,634 $35,773 $42,676 $42,676 $21,609 $21,535 $21,535 $1,436 $1,484 $1,484 $8,042 $8,597 $9,301

EBITDA $535 $590 $590 $4,091 $6,598 $6,598 $945 $893 $893 $166 $170 $170 $737 $769 $797

Total Debt $1,273 $1,101 $1,101 $17,768 $17,426 $17,426 $3,074 $3,149 $3,149 $504 $480 $480 $1,916 $2,198 $2,310

Cash & Cash

Equiv.$178 $265 $265 $5,257 $7,381 $7,381 $65 $69 $69 $38 $25 $25 $158 $343 $223

EBITDA Margin 12.7% 12.7% 12.7% 11.4% 15.5% 15.5% 4.4% 4.1% 4.1% 11.6% 11.4% 11.4% 9.2% 9.0% 8.6%

EBIT / Int. Exp. 2.9x 3.0x 3.0x 2.1x 5.2x 5.2x 5.8x 5.1x 5.1x 4.2x 5.9x 5.9x 3.0x 2.5x 2.7x

Debt / EBITDA 2.2x 1.9x 1.9x 4.3x 2.6x 2.6x 3.3x 3.5x 3.5x 3.0x 2.8x 2.8x 2.6x 2.8x 2.7x

RCF / Net Debt 35.1% 47.1% 47.1% 20.1% 36.8% 36.8% 19.5% 18.3% 18.3% 8.1% 9.5% 9.5% 22.8% 23.7% 23.3%

FCF / Debt 23.7% 15.1% 15.1% 5.0% 22.7% 22.7% 19.0% 7.9% 7.9% 8.2% -1.4% -1.4% -6.3% 3.1% 15.2%

Baa3 StableBa1 StableBaa3 StableA3 StableBaa3 Stable

Barloworld Limited Caterpillar Inc. AutoNation, Inc. Ferreycorp S.A.A. Imperial Group Ltd

All figures and ratios are calculated using Moody's estimates and standard adjustments.FYE = financial year-end; LTM = last twelve months.Source: Moody's Investors Service

Exhibit 10

Moody's-adjusted debt breakdown

(in RAND Millions)FYE

Sep-13

FYE

Sep-14

FYE

Sep-15

FYE

Sep-16

FYE

Sep-17

As Reported Debt 10,253.0 11,316.0 13,124.0 11,044.0 9,678.0

Pensions 1,309.0 1,901.0 1,943.0 2,884.0 2,236.0

Operating Leases 2,691.0 2,811.0 3,468.0 3,573.0 2,952.0

Moody's-Adjusted Debt 14,253.0 16,028.0 18,535.0 17,501.0 14,866.0

All figures and ratios are calculated using Moody's estimates and standard adjustments.Source: Moody's Investors Service

Exhibit 11

Moody's-adjusted EBITDA breakdown

(in RAND Millions)FYE

Sep-13

FYE

Sep-14

FYE

Sep-15

FYE

Sep-16

FYE

Sep-17

As Reported EBITDA 5,345.0 6,289.0 6,130.0 6,494.0 6,610.0

Pensions 17.0 24.0 17.0 14.0 11.0

Operating Leases 897.0 937.0 1,156.0 1,191.0 984.0

Unusual 84.0 -54.0 458.0 173.0 278.0

Moody's-Adjusted EBITDA 6,343.0 7,196.0 7,761.0 7,872.0 7,883.0

All figures and ratios are calculated using Moody's definitions, estimates and standard adjustments.Source: Moody's Investors Service



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Moody’s Investors Service, Inc., a wholly-owned credit rating agency subsidiary of Moody’s Corporation (“MCO”), hereby discloses that most issuers of debt securities (includingcorporate and municipal bonds, debentures, notes and commercial paper) and preferred stock rated by Moody’s Investors Service, Inc. have, prior to assignment of any rating,agreed to pay to Moody’s Investors Service, Inc. for appraisal and rating services rendered by it fees ranging from $1,500 to approximately $2,500,000. MCO and MIS also maintainpolicies and procedures to address the independence of MIS’s ratings and rating processes. Information regarding certain affiliations that may exist between directors of MCO andrated entities, and between entities who hold ratings from MIS and have also publicly reported to the SEC an ownership interest in MCO of more than 5%, is posted annually atwww.moodys.com under the heading “Investor Relations — Corporate Governance — Director and Shareholder Affiliation Policy.”

Additional terms for Australia only: Any publication into Australia of this document is pursuant to the Australian Financial Services License of MOODY’S affiliate, Moody’s InvestorsService Pty Limited ABN 61 003 399 657AFSL 336969 and/or Moody’s Analytics Australia Pty Ltd ABN 94 105 136 972 AFSL 383569 (as applicable). This document is intendedto be provided only to “wholesale clients” within the meaning of section 761G of the Corporations Act 2001. By continuing to access this document from within Australia, yourepresent to MOODY’S that you are, or are accessing the document as a representative of, a “wholesale client” and that neither you nor the entity you represent will directly orindirectly disseminate this document or its contents to “retail clients” within the meaning of section 761G of the Corporations Act 2001. MOODY’S credit rating is an opinion asto the creditworthiness of a debt obligation of the issuer, not on the equity securities of the issuer or any form of security that is available to retail investors. It would be recklessand inappropriate for retail investors to use MOODY’S credit ratings or publications when making an investment decision. If in doubt you should contact your financial or otherprofessional adviser.

Additional terms for Japan only: Moody's Japan K.K. (“MJKK”) is a wholly-owned credit rating agency subsidiary of Moody's Group Japan G.K., which is wholly-owned by Moody’sOverseas Holdings Inc., a wholly-owned subsidiary of MCO. Moody’s SF Japan K.K. (“MSFJ”) is a wholly-owned credit rating agency subsidiary of MJKK. MSFJ is not a NationallyRecognized Statistical Rating Organization (“NRSRO”). Therefore, credit ratings assigned by MSFJ are Non-NRSRO Credit Ratings. Non-NRSRO Credit Ratings are assigned by anentity that is not a NRSRO and, consequently, the rated obligation will not qualify for certain types of treatment under U.S. laws. MJKK and MSFJ are credit rating agencies registeredwith the Japan Financial Services Agency and their registration numbers are FSA Commissioner (Ratings) No. 2 and 3 respectively.

MJKK or MSFJ (as applicable) hereby disclose that most issuers of debt securities (including corporate and municipal bonds, debentures, notes and commercial paper) and preferredstock rated by MJKK or MSFJ (as applicable) have, prior to assignment of any rating, agreed to pay to MJKK or MSFJ (as applicable) for appraisal and rating services rendered by it feesranging from JPY200,000 to approximately JPY350,000,000.

MJKK and MSFJ also maintain policies and procedures to address Japanese regulatory requirements.

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