Alexander Hamilton Best Practice Summit October 28, 2008 Tennecos - - PowerPoint PPT Presentation

Tenneco’s Worldwide Automated Liquidity Management Solution

Gary Silha, CTP Assistant Treasurer Tenneco Inc.

Alexander Hamilton Best Practice Summit

October 28, 2008

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Tenneco’s Worldwide Automated Liquidity Management Solution Alexander Hamilton Best Practice Summit SUB 1 Pool Acct SUB 1 Pool Acct + 1.0 Mil EUR SUB 2 Pool Acct SUB 2 Pool Acct + 2.0 Mil GBP SUB 3 Pool Acct SUB 3 Pool Acct

• 3.0 Mil PLN

SUB 4 Pool Acct SUB 4 Pool Acct

• 4.0 Mil SEK

Principal SUB Pool Acct Principal SUB Pool Acct USD Equiv. $3,526,000 SUB 1 Local Bank SUB 1 Local Bank SUB 2 Local Bank SUB 2 Local Bank SUB 3 Local Bank SUB 3 Local Bank SUB 4 Local Bank SUB 4 Local Bank Wire Transfer Wire Transfer Wire Transfer Wire Transfer = + $1,578,000 = + $3,969,000 = ($1,348,000) = ($673,000) Example

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Alternative A Pool Bank Driven

Automating the transfer of funds to / from the Tenneco subsidiary Notional Cash Pool accounts Subsidiary Pool Account Subsidiary Pool Account Subsidiary Local Account Subsidiary Local Account

MT101 (Request for Wire)

OR

MT940 & 942 (Balance Message s)

Swift 103 Wires

Tenneco’s Worldwide Automated Liquidity Management Solution Alexander Hamilton Best Practice Summit

Alternative B Subsidiary Bank Driven

Subsidiary Pool Account Subsidiary Pool Account Subsidiary Local Account Subsidiary Local Account

MT101 (Request for Wire) OR Swift 103 Wire Swift 103 Wire

Alternative C End of Day ZBA

Subsidiary Pool Account Subsidiary Pool Account Subsidiary Local Account Subsidiary Local Account

End of Day Sweep End of Day Sweep MT940 & 942 (Balance Message s)

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Efficiencies Achieved

Strategic intent delivered:

• Built a state of the art global treasury operation through automation, paying down U.S. external debt daily with

a “dollarized” view of global balances to make single funding / investment decisions, without subsidiary involvement Operational Efficiencies:

• Increased visibility and control of the Company’s worldwide cash
• Elimination of intercompany loan structure and administration, documentation requirements
• Automation of multi-currency transfers to / from treasury centre
• Reduction of daily FX activity, admin, spreads
• Reduction in scope of outsourcing arrangement, fee reduction
• Same day debt reduction in NA by 9:30 am Chicago time
• Elimination of the daily subsidiary cash management function saving an estimated 58 man-hours per

day Financial Efficiencies:

• Consolidation of balance management with single bank providing lower transaction

pricing

• Reduced administrative and operational expense of $1.7 million annually

Alexander Hamilton Best Practice Summit

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Team Members

Alexander Hamilton Best Practice Summit

Gary Silha Assistant Treasurer Tenneco Inc. Lesley Vogt Controller Tenneco Europe Limited Nitixa Patel Senior Treasury Analyst Tenneco Inc. Sharon Brouillette V.P. Transaction Banking The Royal Bank of Scotland (RBS) Group Vanessa Manning V.P. Client Advisory Group The Royal Bank of Scotland (RBS) Group Marco Reategui V.P. Global Treasury Advisory The Royal Bank of Scotland (RBS) Group

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Contacts

Gary Silha Tenneco, Inc. Assistant Treasurer 500 North Field Drive Lake Forest, Illinois 60045 Tel: (847 482 5081) Email: gsilha@tenneco.com www.tenneco.com

Alexander Hamilton Best Practice Summit