PPG Annual Report and 10K 2019

Notes to the Consolidated Financial Statements 52 2019 PPG ANNUAL REPORT AND 10-K 9. Borrowings and Lines of Credit Long-term Debt Obligations ($ in millions) Maturity Date 2019 2018 0.00% note (€300) 2019 $— $343 2.3% notes 2019 — 299 3.6% notes 2020 499 498 9% non-callable debentures (1) 2021 134 133 0.875% notes (€600) 2022 671 685 3.2% notes ($300) (2) 2023 298 298 2.4% notes ($300) 2024 297 — 0.875% note (€600) 2025 665 679 1.4% notes (€600) 2027 665 679 3.75% notes ($700) (3) 2028 695 694 2.5% note (€80) 2029 88 91 2.8% notes ($300) 2029 297 — 7.70% notes 2038 174 174 5.5% notes 2040 247 247 3% note (€120) 2044 127 131 Commercial paper Various 100 — Various other non-U.S. debt (4) Various 38 39 Finance lease obligations Various 11 12 Impact of derivatives on debt (1)(5) N/A 36 10 Total $5,042 $5,012 Less payments due within one year N/A 503 647 Long-term debt $4,539 $4,365 (1) PPG entered into several interest rate swaps, which were subsequently settled in prior periods. The impact of these settlements are being amortized over the remaining life of the debentures as a reduction to interest expense. The weighted average interest rate for these borrowings was 8.4% for the years ended December 31, 2019 and 2018. (2) In February 2018, PPG entered into interest rate swaps which converted $150 million of the notes from a fixed interest rate to a floating interest rate based on the three month London Interbank Offered Rate (LIBOR). The impact of the derivative on the notes represents the fair value adjustment of the debt. The average effective interest rate for the portion of the notes impacted by the swaps was 2.9% and 2.7% as of December 31, 2019 and 2018, respectively. Refer to Note 10, “Financial Instruments, Hedging Activities and Fair Value Measurements” for additional information. (3) In February 2018, PPG entered into interest rate swaps which converted $375 million of the notes from a fixed interest rate to a floating interest rate based on the three month LIBOR. The impact of the derivative on the notes represents the fair value adjustment of the debt. The average effective interest rate for the portion of the notes impacted by the swaps was 3.3% and 3.2% as of December 31, 2019 and 2018, respectively. Refer to Note 10, “Financial Instruments, Hedging Activities and Fair Value Measurements” for additional information. (4) Weighted average interest rate of 3.7% and 3.8% as of December 31, 2019 and 2018, respectively. (5) Fair value adjustment of the 3.2% $300 million notes and 3.75% $700 million notes as a result of fair value hedge accounting treatment related to the outstanding interest rate swaps as of December 31, 2019 and 2018, respectively. Refer to Note 10, “Financial Instruments, Hedging Activities and Fair Value Measurements” for additional information. 2019 Activities In August 2019, PPG completed a public offering of $300 million aggregate principal amount of 2.4% notes due 2024 and $300 million aggregate principal amount of 2.8% notes due 2029. These notes were issued pursuant to PPG’s existing shelf registration statement and pursuant to an indenture between the Company and The Bank of New York Mellon Trust Company, N.A., as trustee, as supplemented (the "2019 Indenture"). The 2019 Indenture governing these notes contains covenants that limit the Company’s ability to, among other things, incur certain liens securing indebtedness, engage in certain sale- leaseback transactions, and enter into certain consolidations, mergers, conveyances, transfers or leases of all or substantially all the Company’s assets. The terms of these notes also require the Company to make an offer to repurchase the notes upon a Change of Control Triggering Event (as defined in the 2019 Indenture) at a price equal to 101% of their principal amount plus accrued and unpaid interest. The Company may issue additional debt from time to time pursuant to the 2019 Indenture. The aggregate cash proceeds from the notes, net of discounts and fees, was $595 million. In November 2019, PPG’s €300 million 0.00% notes and $300 million 2.3% notes matured, upon which the Company paid $634 million to settle these obligations.

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