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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of the

Securities Exchange Act of 1934

(Amendment No.    )

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xý Definitive Proxy Statement
¨å Definitive Additional Materials
¨å Soliciting Material Pursuant to §240.14a-12
AMERICAN AXLE & MANUFACTURING HOLDINGS, INC.
(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
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LOGO

  


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One Dauch Drive

Detroit, Michigan 48211-1198

www.aam.com



NOTICE OF ANNUAL MEETING OF STOCKHOLDERS

May 2, 2013

5, 2016

American Axle & Manufacturing Holdings, Inc. (AAM)

Time and Place

 3:8:00 p.m.a.m., local time, on Thursday, May 2, 20135, 2016
 AAM World Headquarters Auditorium, One Dauch Drive, Detroit, Michigan

Items of Business

 

(1)   Elect threetwo members of the Board of Directors to serve until the Annual Meeting of Stockholders in 2016;

2019;

(2) Advisory vote to approve named executive officer compensation;

(3)   Ratify the appointment of Deloitte & Touche LLP as AAM’s independent registered public accounting firm for the year ending December 31, 2013;2016; and

(4)   Attend to other business properly presented at the meeting.

Record Date

 
You may vote if you were an AAM stockholder at the close of business on
March 5, 2013.8, 2016.

Meeting Admission

 Admission may be limited to AAM stockholders as of the record date and holders of valid proxies. Please be prepared to present identification for admittance. Stockholders holding stock in brokerage accounts will need to bring a copy of a brokerage statement reflecting stock ownership as of the record date. Cameras and recording devices will not be permitted.

Proxy Materials

 We have elected to furnish materials for the 20132016 Annual Meeting of Stockholders via the Internet. On March 21, 2013,24, 2016, we mailed a notice of Internet availability (notice) to most stockholders containing instructions on how to access the proxy materials on the Internet instead of receiving paper copies in the mail.
 
Important Notice Regarding Internet Availability of Proxy Materials for the May 2, 20135, 2016 Stockholder Meeting.Meeting: The Proxy Statement and 20122015 Annual Report and Form 10-K are available atwww.envisionreports.com/AXL.axl.

By Order of the Board of Directors,

David E. Barnes

General Counsel, Secretary & Secretary

Chief Compliance Officer
March 21, 2013

24, 2016



2013

Table of Contents

2016 ANNUAL MEETING OF STOCKHOLDERS

PROXY STATEMENT

TABLE OF CONTENTS

 
Page
No.

INTERNET AVAILABILITY OF PROXY MATERIALS

2
 2 

QUESTIONS AND ANSWERS ABOUT VOTING AND THE ANNUAL MEETING

2
 2 

PROPOSAL 1: ELECTION OF DIRECTORS

4
Nominees for Director
5
Returning Directors
4
6
Corporate Governance
10
 

Nominees for Director

5

Returning Directors

12

COMPENSATION OF EXECUTIVE OFFICERS

20
16

Compensation Discussion and Analysis

20
16

Summary Compensation Table

33
29

Grants of Plan-Based Awards

35
31

Outstanding Equity Awards at December 31, 20122015

39
34

Options Exercised and Stock Vested

40
35

Pension Benefits

41
36

Nonqualified Deferred Compensation

44
38

Potential Payments Upon Termination or Change of Control

40
 46 

PROPOSAL 2: ADVISORY VOTE ON EXECUTIVE COMPENSATION

46
 55 

20122015 COMPENSATION OF NON-EMPLOYEE DIRECTORS

47
 56 

SECURITY OWNERSHIP

59
49

Section 16(a) Beneficial Ownership Reporting Compliance

50
 60 

PROPOSAL 3: RATIFICATION OF APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR 2013

2016
51
 61 

AUDIT COMMITTEE DISCLOSURE

62
51

Report of the Audit Committee

62
51

Policy for Pre-Approval of Audit and Non-Audit Services

63
52

Fees of Independent Public Accountants

52
 63 

OTHER MATTERS

53
  64


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PROXY STATEMENT

Annual Meeting of Stockholders

To Be Held May 2, 2013

5, 2016

INTERNET AVAILABILITY OF PROXY MATERIALS

American Axle & Manufacturing Holdings, Inc. (AAM or the Company) is providing proxy materials electronically via the Internet, instead of mailing printed copies of those materials to each stockholder. On March 21, 2013,24, 2016, we mailed to our stockholders (other than those who previously requested e-mail or paper delivery) a Notice of Availability of Proxy Materials containing instructions on how to access our proxy materials, including our proxy statement and 2012 Annual Report2015 annual report on Form 10-K. The Notice of Availability of Proxy Materials provides instructions on how you may submit your proxy over the Internet or by telephone.

This electronic delivery process is designed to expedite stockholder receipt of proxy materials, lower the cost of the Annual Meeting of Stockholders (annual meeting), and conserve natural resources. However, if you would prefer to receive printed proxy materials, please follow the instructions included in the Notice of Availability of Proxy Materials. If you have previously elected to receive our proxy materials electronically, you will continue to receive these materials by e-mail unless you elect otherwise. If you received a printed copy of proxy materials by mail and would like to view future proxy materials over the Internet, you can do so by accessing the Internet atwww.envisionreports.com/AXLaxl.

QUESTIONS AND ANSWERS ABOUT VOTING AND THE ANNUAL MEETING

Why am I receiving this proxy statement?

You received these proxy materials because you owned shares of AAM common stock on March 5, 20138, 2016 (record date). AAM’s Board of Directors (Board) is soliciting your proxy to vote your shares at the annual meeting. By use of a proxy, you can vote whether or not you attend the meeting. This proxy statement includes information that we are required to provide to you and is designed to assist you in voting your shares.

Who is entitled to vote?

Holders of AAM common stock on the record date are entitled to one vote per share. You are a holder of record if your shares are held directly in your name with AAM’s transfer agent, Computershare Trust Company, N.A. If your shares are held in the name of a broker, bank, trustee or other record holder, you are a street name holder. If you hold shares in more than one account, each notice, proxy and/or voting instruction card you receive that has a unique control number must be voted so that all your shares are voted.

How do I vote?

You may vote by any of the following methods:

•

In person — attending the annual meeting and casting a ballot.

•

By mail — using the proxy and/or voting instruction card provided.

•

By telephone or over the Internet — following the instructions on your notice card, proxy and/or voting instruction card.

In person — attending the annual meeting and casting a ballot.
By mail — using the proxy and/or voting instruction card provided.
By telephone or over the Internet — following the instructions on your notice card, proxy and/or voting instruction card.
If you vote by telephone or over the Internet, have your notice card or proxy and/or voting instruction card available. The control number on your card is necessary to process your vote. A telephone or Internet vote authorizes the named proxies to vote in the same manner as if you marked, signed and returned the card by mail. If you hold shares in street name, refer to the voting instructions provided by your broker, bank, trustee or other record holder.

How many shares may vote at the meeting?

As of March 5, 2013,8, 2016, we had 74,839,56776,484,312 shares of common stock outstanding and entitled to vote. Under AAM’s by-laws, a majority of these shares must be present in person or by proxy to hold the annual meeting and take any action during the meeting.

Can I change my vote?

You may change your vote at any time before the annual meeting by:

revoking it by written notice to AAM’s Secretary at the address on the cover of this proxy statement;

voting in person at the annual meeting; or

delivering a later-dated proxy vote by mail, telephone or over the Internet.


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What are the Board’s recommendations on how I should vote my shares?

The Board recommends that you vote your shares as follows:

Proposal 1 —FOR the election of the threetwo nominees with terms expiring at the 20162019 annual meeting;

Proposal 2 —FOR approval, on an advisory basis, of the compensation of AAM’s named executive officers as described in the Compensation Discussion and Analysis, tables and related narrative; and

Proposal 3 —FOR ratification of the appointment of Deloitte & Touche LLP as the Company’s independent registered public accounting firm for the year ending December 31, 2013.2016.

What are my choices when voting?

Proposal 1 — You may vote for or withhold your vote on one or more of the nominees.

Proposal 2 — You may vote for or against the proposal to approve the compensation of our named executive officers, or you may abstain from voting your shares.

Proposal 3 — You may vote for or against the proposal to ratify the appointment of the Company’s independent registered public accounting firm, or you may abstain from voting your shares.

What vote is required to approve each proposal?

Proposal 1 — A plurality of the votes cast to elect a director, which means that nominees with the most affirmative votes will be elected to fill the available seats.

Proposal 2 — An affirmative vote of a majority of the shares voted in person or by proxy must be cast in favor of the advisory vote to approve the compensation of AAM’s named executive officers.

Proposal 3 — An affirmative vote of a majority of the shares voted in person or by proxy must be cast in favor of the ratification of the appointment of the Company’s independent registered public accounting firm.

Proposals 2 and 3 are advisory votes only and, as discussed in more detail in each proposal, the voting results are not binding on AAM. However, with respect to proposal 2, the Board and the Compensation Committee will consider the outcome of the vote in making future determinations concerning the compensation of our named executive officers. With respect to proposal 3, the Audit Committee will consider whether the appointment of Deloitte & Touche, LLP is in the best interests of the Company if the appointment is not ratified.

Who will count the votes?

Representatives of Computershare Trust Company, N.A., AAM’s transfer agent, will count the votes and serve as our inspector of election. The inspector of election will attend the annual meeting.

What if I “withhold” my vote or “abstain”?

Votes withheld and abstentions will be counted as present for purposes of determining whether a majority of shares is present to establish a quorum and hold the annual meeting. Abstentions will not be counted in the tally of votes for or against any proposal. A withheld vote has the same effect as an abstention.

What if I do not vote and do not attend the annual meeting?

If you are a holder of record and you do not vote your shares at the annual meeting or by proxy, your shares will not be voted. If you sign and return your proxy card without specific voting instructions, your shares will be voted as recommended by the Board.

Under New York Stock Exchange (NYSE) rules, brokers have discretionary power to vote your shares only on “routine” matters. Brokers do not have discretionary power to vote your shares on “non-routine” matters. If you hold shares in street name, and you do not give your bank, broker, trustee or other holder of record specific voting instructions for your shares, your record holder can only vote your shares on the ratification of the Company’s independent registered public accounting firm (proposal 3), a “routine” matter.

Without your specific instructions, your record holder cannot vote your shares on the election of directors andor the advisory vote on named executive officer compensation. For each of these matters, ifIf you do not instruct your record holder how to vote on these proposals, the record holder maywill not vote your shares. Shares not voted will be broker non-votes and will not be counted in determining the outcome of the vote for proposals 1 and 2. Broker non-votes will have no impact on the outcome of these proposals. We urge you to give your record holder voting instructions on each proposal being presented at the annual meeting.

Information not incorporated into this proxy statement.

The information on our website (www.aam.com) is not, and shall not be deemed to be, a part


3
Table of this proxy statement nor, by reference or otherwise, incorporated into any other filings we make with the SEC.

Contents


PROPOSAL 1: ELECTION OF DIRECTORS

The Board proposes that the three directors standing for re-election as Class II directors, Elizabeth A. Chappell Steven B. Hantler and John F. Smith be electedre-elected to the Board as Class II directors for terms expiring at the annual meeting in 2016.

2019. Ms. Chappell has served on AAM's Board since 2004 and currently serves as Chair of the Compensation Committee and as a member of the Nominating/Corporate Governance Committee and Strategy & Technology Committee. Mr. Smith has served on AAM's Board since 2011 and currently serves as Chair of the Strategy & Technology Committee and as a member of the Audit Committee.

The Board is divided into three classes. Directors serve for staggered three-year terms. The Board believes that the staggered election of directors helps to maintain continuity and ensures that a majority of directors at any given time will have in-depth knowledge of the Company.

The Board unanimously approved the nominations of our Class II directorsMs. Chappell and Mr. Smith based on their achievements, special competenciesdemonstrated effectiveness as members of our Board and the Committees on which they serve, their relevant experience and expertise, and their sound judgment and integrity. Each nominee brings a strong and unique background and set of skills to the Board.
Collectively, the Board has high levels of competence and experience in a variety of areas, including manufacturing, engineering, finance, international business, management, restructuring, law, risk management, strategic business development and the global automotive industry. A summary of the principal occupation, professional background and specific qualifications and/or skillsknowledge and expertise that qualify each nominee and returning director to serve on our Board is provided in the following pages of this proxy statement.

The Board unanimously recommends a vote FOR each of the nominees.


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Nominees for Director

Class II —II— Directors to hold office until the 20162019 Annual Meeting of Stockholders

LOGO 

ELIZABETH A. CHAPPELL

Age 55

Elizabeth A. (Beth)58

Ms. Chappell has served as President and Chief Executive Officer of the Detroit Economic Club since 2002. Previously, she served as Executive Vice President, Corporate Communications & Investor Relations for Compuware Corporation. From 1995 to 2000, Ms. ChappellMs.Chappell was President and Chief Executive Officer of a consulting firm she founded, The Chappell Group, Inc. For 16 years, Ms. Chappell held executive positions at AT&T. From 1999 to 2009, Ms. Chappell served on the Board of Directors of the Handleman Company. She also serves on a number of civic boards, including Brother Rice High School,the Michigan State University Capital Campaign, Citizens Research Council, Detroit Regional Chamber, Airport Authority-Citizen’s Review Council,the United Way Board and Tocqueville Committee, and Michigan Economic Development Corporation and has served on the Charter One Regional Advisory Board (Midwest) since 2001.. Ms. Chappell is a former board member of the Karmanos Cancer Institute, Michigan Economic Growth Authority and Hospice of Michigan. Ms. Chappell’s demonstrated leadership skills, entrepreneurial business experience and service on various Boards of Directorsboards enhance her contributions to the Board on matters of significance to AAM’s strategic business development.

Director since

2004

LOGO

STEVEN B. HANTLER

Age 60

Mr. Hantler is Director of Policy Initiatives for The Marcus Family Office. In this capacity, he advises Home Depot co-founder, Bernie Marcus, in the areas of government affairs, legalinvestor relations, community outreach and regulatory policy, national security, free enterprisecorporate citizenship, marketing and higher education. Previously, he had a 27-year career with Chrysler Corporation, where he held positions as Assistant General Counsel, Manufacturing Group Counsel, and Senior Trial Attorney. Prior to joining Chrysler, Mr. Hantler was engaged in private law practice. Mr. Hantler is a Senior Fellow at the Pacific Research Institute and a member of the Legal Policy Advisory Board of the Washington Legal Foundation. Previously, Mr. Hantler served as Chair of the State Government Leadership Foundation, which educates state leaders on public policy issues, Chair of the Advisory Board of the National Judicial College, and on the Board of Directors of the New York University Law School Center for Labor and Employment. Mr. Hantler’s leadership experience and expertise in law, public relations and government affairs provide the Board with knowledge and insight in these areas of importance to the Board’s oversight of AAM’s global business growthcommunications, executive compensation and strategic initiatives.

business development.		 
Director since

2011

2004
LOGO
 

JOHN F. SMITH

Age 62

65

Mr. Smith is principal of Eagle Advisors LLC, a consulting firm in Bloomfield Hills, Michigan that specializes in strategy development and performance improvement. From 2000 to 2010, Mr. Smith served inheld positions of increasing responsibility with General Motors Corporation in sales and marketing, product planning and corporate strategy, most recently as Group Vice President, Corporate Planning and Alliances. During his 42-year career in the automotive industry, Mr. Smith also served as General Manager of Cadillac Motor Car, President of Allison Transmission, and Vice President, Planning at General Motors International Operations in Zurich, Switzerland. In June 2012, Mr. Smith joinedserves on the Boardboards of Directors ofCEVA Holdings LLC (where he serves on the Executive Committee) and Arnold Magnetics. Mr. Smith Electric Vehicles (no relation), a manufacturer of all-electric commercial vehicles and the Advisory Board ofalso serves as an advisor to VNG.CO, a developer of compressed natural gas refueling stations. In January 2013,stations, and Enginetics LLC, a fuel-injection technology start-up company. Mr. Smith joined the Advisory Boardis a member of Palogix International, a provider of in-bound logistics and container management solutions. Mr. Smith also serves on the boards of several nonprofit organizations, including the National Advisory Board of Boy Scouts of America and Chairman of the Board of Trustees of St. John’sJohn's Providence Health System in Michigan. He served on the boards of Smith Electric Vehicles Corp. (June 2012 - December 2013) and Plasan Carbon Composites (December 2013 - December 2014). Mr. Smith’sSmith's extensive experience in manufacturing, finance, business development, international operations, sales and marketing, product development and mergers and acquisitions is aligned with AAM’sAAM's key business objectives, including continued global business growth and diversification.


 Director since

2011









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RETURNING DIRECTORS
Class III — Directors to hold office until the 20142017 Annual Meeting of Stockholders


LOGO
 

RICHARD E. DAUCH

Age 70

Richard E. Dauch is Co-Founder & Executive Chairman of the Board of AAM and is also Chairman of the Executive Committee of the Board. He served as Chief Executive Officer from 1994 through August 2012 and has been a member of the Board since AAM began operations in March 1994. In October 1997, he was named Chairman of the Board of Directors. He was also President of AAM from March 1994 through December 2000. Prior to March 1994, he spent 12 years at Chrysler Corporation, where he established the just-in-time materials management system and the three-shift manufacturing vehicle assembly process. He is a retired officer from the Chrysler Corporation. Mr. Dauch’s last position at Chrysler, in 1991, was Executive Vice President of Worldwide Manufacturing. Mr. Dauch also served as Group Vice President of Volkswagen of America, where he established the manufacturing facilities and organization for the successful launch of the first major automotive transplant in the United States. Mr. Dauch has more than 48 years of experience in the automotive industry. Mr. Dauch currently serves on the Board of Directors of the National Association of Manufacturers (N.A.M.), where he previously served as Chairman. In 2012, Mr. Dauch was inducted into IndustryWeek’s Manufacturing Hall of Fame. He has lectured extensively on the subject of manufacturing and authored two books, Passion for Manufacturing, which was released in 1993, and American Drive, which was released in September 2012. The Board considers Mr. Dauch’s continuing leadership of the Board and the services he provides to AAM in his new role as Executive Chairman to be significant contributors to the achievement of the Company’s strategic goals. Mr. Dauch’s extensive expertise in the global automotive industry and manufacturing operations supports AAM’s business strategy to build value for its key stakeholders.

Director since

1994

LOGO

JAMES A. McCASLIN

Age 64

67

Mr. McCaslin retired from Harley Davidson, Inc. in April 2010. Mr. McCaslin joined Harley Davidson in 1992 and held various senior executive leadership positions, including President and Chief Operating Officer of Harley-Davidson Motor Company from 2001 to 2009. From 1989 to 1992, he held manufacturing and engineering positions with JI Case, a manufacturer of agricultural equipment. Previously, he held executive positions in manufacturing and quality with Chrysler Corporation, Volkswagen of America and General Motors Corporation, where he began his 40-year career in manufacturing. From 2003 to 2006, he served on the Board of Directors of Maytag Corporation. Mr. McCaslin has served on a number of civic boards, including Boys and Girls Clubs of Greater Milwaukee, Manufacturing Skill Standards Council and Kettering University. Mr. McCaslin’s extensive operational expertise and experience in multiple manufacturing industries in the original equipment and aftermarket product markets provide the Board with a valued resource in support of AAM's operational objectives, which include engineering, quality and technology leadership, operational excellence and global geographic and product diversification, one of AAM’s key strategic objectives.

diversification.
  
Director since

2011

LOGO 

WILLIAM P. MILLER II CFA

Age 57

60

Mr. Miller, Chartered Financial Analyst, is Head of Asset Allocation for the Senior Managing Director & Chief Financial Officer of Financial Markets International, Inc., an international law and economics consulting firm. SinceSaudi Arabian Investment Company. Separately, since 2003, Mr. Miller has been a member of the Board of Directors of the Chicago Mercantile Exchange, serving on the Audit Committee, Finance Committee and Market Regulation Oversight Committee. Since JuneFrom April 2011 Mr. Miller has served onto October 2013, he was the BoardSenior Managing Director & Chief Financial Officer of Directors of the Dubai Mercantile Exchange, serving on the Compensation Committee and the Compliance Committee. Since December 2012, Mr. Miller has served on the Institutional Investor Advisory Board for Golub Capital, a U.S. asset manager with over $7 billion of assets under management.Financial Markets International, Inc. From 2005 to 2011, he was employed by the Ohio Public Employees Retirement System, where he served as Deputy Chief Investment Officer. Previously, he served aswas Senior Risk Manager for the Abu Dhabi Investment Authority and as an Independent Risk Oversight Officer and Chief Compliance Officer for Commonfund Group, an investment management firm for educational institutions.Group. Mr. Miller also served as Director, Trading Operations and Asset Mix Management with General Motors Investment Management Corp. and as a financial analyst with the U.S. Department of Transportation. Mr. Miller also was a member ofserved on the Public Company Accounting Oversight Board’s Standing Advisory Group, the Institutional Investor Advisory Board for Golub Capital, the Board of Directors of the Dubai Mercantile Exchange and a member of the Board of Directors of the Dubai International Financial Exchange. Mr. Miller’s expertise in finance, investments, risk management, compliance, international business, audit and accounting provides the Board with valuable guidance in assessing and managing risks and in fulfilling the Board’s financial oversight role.

  
Director since

2005


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LOGO
 

LARRY K. SWITZER

SAMUEL VALENTI III
Age 69

Larry K. Switzer retired70

Mr. Valenti serves as Chairman and Chief Executive Officer of DANKA PLC, London, England,Valenti Capital LLC and World Capital Partners, investment firms located in Bloomfield Hills, Michigan. Since 2002, Mr. Valenti has served as Chairman of the Board of TriMas Corporation, a global independentmanufacturer of highly engineered precision products for industry. In June 2015, Mr. Valenti became Co-Chair of the Board of Directors of Horizon Global Corporation, a designer, manufacturer and distributor of office equipment, in 2000. From 1994 to 1998,custom-engineered towing, trailer and cargo management products. Until 2008, Mr. Switzer was Senior ExecutiveValenti had a 40-year career with Masco Corporation, a Fortune 500 manufacturer of home building and home improvement products, serving as Vice President - Investments from 1974 to 1998. From 1988 to 2008, Mr. Valenti was President and Chief Financial Officer of Fruita member of the Loom, Inc. Previously, he served as Executive Vice PresidentBoard of Directors of Masco Capital Corporation. Mr. Valenti is a member of the Business Leaders for Michigan and Chief Financial Officer for Alco Standard Corporation and, from 1989 to 1992, Senior Vice President and Chief Financial Officer for S.C. Johnson & Son, Inc. Mr. Switzer has also held senior executive positions at Bendix Corp., White Motor Corp. and Gencorp. As a former chief financial officer, Mr. Switzer serves as a valued resource to the Board in finance, accounting and tax matters and provides significant expertise and perspective in the Board’s oversightChairman of the Company’s capital structure, liquidityRenaissance Venture Capital Fund. Mr. Valenti has demonstrated leadership skills, breadth of management experience in diversified manufacturing businesses, and strategic business development.

highly recognized subject matter expertise in mergers and acquisitions, finance, economics and asset management.
 Director since

2005

2013





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Class I — Directors to hold office until the 20152018 Annual Meeting of Stockholders


LOGO

 

DAVID C. DAUCH

Age 48

51

David C. Dauch is President & Chief Executive Officer of AAM, a position he has held since September 2012. Since June 2008, heMr. Dauch was appointed Chairman of the Board in August 2013. From September 2012 through August 2015, Mr. Dauch served as AAM's President & CEO. Prior to that, Mr. Dauch served as President & Chief Operating Officer (2008 - 2012) and previously served as Executive Vice President & Chief Operating Officer. Mr. D.C. Dauchheld several other positions of increasing responsibility from the time he joined AAM in July 1995 and has served in positions of increasing responsibility.1995. Prior to joining AAM, Mr. D.C. Dauch served inheld several positions at Collins & Aikman Products Company, where he received the President’s Award for leadership and innovation. Mr. D.C. Dauch also served on the Collins & Aikman Board of Directors from 2002 to 2007. Presently, he serves on the Boards of Directorsboards of Business Leaders for Michigan, the Detroit Regional Chamber, the Great Lakes Council Boy Scouts of America, and the Boys & Girls Club of Southeast Michigan.Michigan, the National Association of Manufacturers (NAM), the Original Equipment Suppliers Association (OESA), Amerisure Mutual Holdings, Inc. and the Amerisure Companies (since December 2014) and Horizon Global Corporation (since June 2015). Mr. D.C. Dauch also serves on the Miami University Business Advisory Council. Mr. D.C. Dauch’s day to day leadership as President & Chief Executive Officer provides him with intimate knowledge of and responsibility for developing and implementing the Company’s operating and strategic objectives. Mr. D.C. Dauch’s leadership of AAM’s global business and operations provides the Board with strategic vision and insight regardingthat are vital to AAM’s strategic plans for the future.

 
Director since
2009

LOGO

 

FOREST J. FARMER

WILLIAM L. KOZYRA
Age 72

Forest J. Farmer has served as58

Mr. Kozyra is Chairman of the Board and Chief Executive Officer & President of The Farmer Group, a holding company for three technology and manufacturing corporations, since 1998. Mr. Farmer serves on the Board of Directors of Saturn Electronics & Engineering, Inc.TI Automotive Ltd., a global supplier of electronic components, engineeringautomotive fluid storage, carrying and other servicesdelivery technology. He has served as TI Automotive's CEO since June 2008. Prior to that, Mr. Kozyra was President and CEO of Continental AG North America for 10 years. He was also a member of the automotive, applianceExecutive Board, Continental AG (DAX), Hanover, Germany, with responsibility for Continental AG's NAFTA businesses. Previously, at ITT Automotive, he served as Vice President and communications industries. From 1997General Manager, Brake and Chassis Systems North America. Prior to September 2011,joining ITT Automotive, he was Vice President and General Manager of Bosch Braking Systems' Brake Products Division. Mr. Farmer wasKozyra is a member of the Board of Directors of The Lubrizol Corporation, serving on the Compensation Committee. In 1994, he retired from Chrysler Corporation after 26Motor & Equipment Manufacturers Association (MEMA), the Ford Motor Company Top 100 Supplier Forum, the Board of Trustees of the Notre Dame Preparatory School, the Boy Scouts of America Executive Board in Detroit, Michigan, the Board of Advisors of the University of Detroit and the University of Detroit Alumni Council and the Society of Automotive Engineers. Mr. Kozyra has 36 years of service, which included six years as President of its Acustarexperience in the global automotive parts subsidiary. Through his senior management-level experienceindustry and his prior service on the Board and Compensation Committee of another public company, Mr. Farmer brings strongdemonstrated leadership skills extensive U.S. automotive and technical background in the areas of manufacturing, experience,engineering, quality systems and public company experience to our Board.

sales, all of which are aligned with AAM's business objectives.
  Director since

1999

2015


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LOGO

 

RICHARD C. LAPPIN

PETER D. LYONS
Age 68

Richard C. Lappin60

Mr. Lyons, an attorney, is Executive Chairman of VOKAL Interactive, a maker of mobile applications for business. From 2007 to 2010, he served as Chairmanpartner and Co-Head of the BoardGlobal Public Mergers & Chief Executive OfficerAcquisitions Group of Clear Sky Power, an alternative energy company.Freshfields Bruckhaus Deringer US LLP, which he joined in September 2014. Based in the New York office of Freshfields, Mr. Lappin retiredLyons represents leading U.S. and global companies in 2004 as Chairmanacquisitions and sales of the Board of Haynes International, Inc. Previously,public and private companies, asset acquisition and disposition transactions, and joint ventures. Prior to joining Freshfields, Mr. Lappin served as Senior Managing Director of The Blackstone Group L.P., where heLyons was a partner with Shearman & Sterling LLP and a member of the Private EquityMergers & Acquisitions Group based in New York, New York. Mr. Lyons practiced law at Shearman & Sterling for 35 years. Mr. Lyons has been recognized and recommended as an Mergers & Acquisitions practitioner by Chambers Global, Chambers USA, The Legal 500 US, and IFLR1000. Mr. Lyons received his law degree from 1998Georgetown University Law Center and his Bachelor of Arts degree from the University of Virginia. From 2003 to 2002. He also helped monitor2014, while a partner at Shearman & Sterling, Mr. Lyons served as lead counsel to AAM and as a key advisor to the operations of Blackstone Capital Partners portfolioBoard on legal matters. Mr. Lyons has extensive experience advising global companies and evaluated business strategy options. From 1989 to 1998, Mr. Lappin served as President of Farley Industries, which included West Point-Pepperell, Inc., Acme Boot Company, Inc., Tool and Engineering, Inc., Magnus Metals, Inc. and Fruit of the Loom, Inc. He also served as President & Chief Executive Officer of Doehler-Jarvis and Southern Fastening Systems, and he has held senior executive positions with Champion Spark Plug Company and RTE Corporation. Mr. Lappin’s experience as a CEO and his financial expertise provide the Board with an important perspective in the areas of business strategy and organizational development,corporate boards as well as sound investment criteria, capital structurehighly recognized subject matter expertise in mergers and liquidity management.

acquisitions and other corporate transactions, corporate governance and other areas of significance to the Board.
 Director since

1999

2015

LOGO

 

THOMAS K. WALKER

Age 72

Thomas K. Walker is Chairman of the Board & Chief Executive Officer of Lackawanna Acquisition Corporation and is the former President of Amcast Automotive, where from 1995 to 1999 he directed all activities for the $300 million automotive group. Previously, he held senior executive positions with ITT Automotive and Allied-Signal Automotive Catalyst Co. He also served in various manufacturing and engineering leadership positions with Volkswagen of America and with General Motors Corporation, where he began his 50-year career in the automotive industry. Mr. Walker serves on the National Advisory Board for Michigan Technological University. Mr. Walker’s business acumen and extensive leadership experience in the automotive industry enable him to provide our Board with expertise related to engineering, manufacturing operations and strategic business development.

 Director since

1999










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CORPORATE GOVERNANCE

Corporate Governance Guidelines

The Board has adopted Corporate Governance Guidelines that meet or exceed the requirements of the NYSE listing standards. AAM’s Corporate Governance Guidelines are available on our website athttp://investor.aam.com.

Director Independence

AAM’s Corporate Governance Guidelines provide that at least a majority of the members of the Board and each member of the Audit Committee, Compensation Committee and Nominating/Corporate Governance Committee meet the independence criteria of the NYSE listing standards. In addition,Currently, eight of our nine directors are independent from the Company. Only David C. Dauch, who serves as AAM's Chief Executive Officer, is not independent due to his employment with AAM.
The Board has established Director Independence Guidelines to assist in determining the independence of our directors for purposes of the NYSE independence standards. The Director Independence Guidelines are included in AAM’s Corporate Governance Guidelines, which are available on our website athttp://investor.aam.com.

The Board annually reviews and determines, on the recommendation of the Nominating/Corporate Governance Committee, whether any director has a material relationship with the Company that would interfere with the exercise of independent judgment in carrying out the responsibilities of a director. When assessing materiality, the Board considers relevant facts and circumstances of which it is aware. No director qualifies as independent unless the Board determines that the director has no direct or indirect material relationship with the Company.

The

As a result of this evaluation, the Board has affirmatively determined that the following nominees and returning directors have no material relationships with AAM and are independent: Elizabeth A. Chappell, Forest J. Farmer, Steven B. Hantler, Richard C. Lappin,William L. Kozyra, Peter D. Lyons, James A. McCaslin, William P. Miller II, John F. Smith Larry K. Switzer and Thomas K. Walker. Richard E. Dauch, Co-Founder & Executive Chairman and David C. Dauch, President & CEO, are not independent due to their employment with AAM. Mr. D.C. Dauch is the son of Mr. R.E. Dauch.

Samuel Valenti III.

In making these independence determinations, the Board considered Ms. Chappell’s position as President & CEO of the Detroit Economic Club, in light of the sponsorship fees AAM pays to this non-profit organization. The annual fees paid by AAM to the Detroit Economic Club are significantly below the threshold amount established under the NYSE independence standards and our Director Independence Guidelines, which is the greater of two percent of the outside entity’s annual gross revenues or $1 million.

Board Leadership Structure

The Board has the responsibility to determine the appropriateBoard's current leadership structure for the Company, including whether it is best for the Company atincludes a given point in time for the roles of Boardcombined Chairman and CEO to be separate or combined.

Historically,role with a lead independent director. In August 2013, the positions of CEO and Chairman were held by Mr. R.E. Dauch. Mr. R.E.Board appointed David C. Dauch has been our CEO since he co-founded AAM in 1994 and has served as Chairman since 1997. As a result of the Company’s multi-year CEO succession planning and leadership development process, as well asBoard.


Our Board believes that it is in the Board’s ongoing reviewbest interest of its structure,the Company to combine the roles of Chairman and CEO were separated in September 2012.

Effective September 1, 2012,at this time because it provides the Company with unified leadership and direction. The Board appointed David C. Dauch President & CEO. Concurrentbelieves the Company's CEO is best situated to serve as Chairman because he is the director most familiar with this appointment, AAM’s co-founder, Richard E. Dauch, was named Executive Chairman of the Board. Both the President & CEOCompany's business and the Executive Chairman report solely to the Board. As Executive Chairman of the Board, Mr. R.E. Dauch will continue to provide leadership to the Board based on his extensive knowledge of the global automotive industry, and his prior experience serving as the Board’s Chairman & CEO. The separation of these roles permits Mr. D.C. Dauchis in a position to focus on leading AAM’s global business and day-to-day operations while providing the Board witheffectively identify strategic vision and insight regarding AAM’s strategic plans for the future.

In addition to the customary procedural duties of the Chairman of the Board, the Executive Chairman has the following responsibilities:

Together with the President & CEO, represent the Company to external groups, including shareholders, customers, creditors, suppliers, local communities and governmental organizations and other key stakeholders;

Promote the Company as a technology and quality leader within the auto industry through public speaking, media appearances and global community affairs;

Develop relationships and maintain liaisons with universities that excel in the Company’s fields of both current and future business lines;

Develop relationships and maintain liaisons with other business leaders to share best practices in long-term planning;

Oversee and evaluate (but not direct) day-to-day operations;

Oversee the long-term strategy and vision of the Company and ensure the Board’s participation in strategic planning;

Discuss and review with the President & CEO issues facing the Company;

Evaluate the performance of the Company in achieving its goals and objectives;

Overseepriorities and lead the developmentdiscussion and implementationexecution of a brand management program that promotesstrategy. While the Company's independent directors bring experience, oversight and expertise from various perspectives outside the Company, as a technologythe CEO's in-depth knowledge of our business enables him to identify areas of focus for the Board and quality leader withineffectively recommend appropriate agendas. The Board believes that the auto industry;combined role of Chairman and

CEO facilitates information flow between management and the Board, provides clear accountability and promotes efficient decision making, all of which are essential to effective governance.

Oversee and review succession planning.

Our Board leadership structure is further enhanced by an Independent Lead Director, a position currently held byDirector. In April 2014, the Board selected Mr. Walker.McCaslin to serve in this role. The Independent Lead Director has the following responsibilities:

Director's responsibilities are to:

Presidepreside at executive sessions of the independent directors, which are held at the end of each scheduled Board meeting;

Callcall special executive sessions of independent directors, as appropriate;

Serve on all standing committees required by NYSE listing standards and on the Executive Committee;

Serveserve as Chairchair of the Nominating/Corporate Governance Committee;

Serveserve as the liasonliaison between the independent directors and AAM’s Executivethe Chairman and President & CEO;

Informinform the Executive Chairman and President & CEO of issues arising from executive sessions of the independent directors; and

Withwith Board approval, retain outside advisors and/or consultants who report directly to the full Board on matters of interest to the full Board.

In September 2012, the Board approved the temporary assignment of Mr. Walker to serve as Non-Executive Chairman during the absence of the Executive Chairman for a medical procedure. Mr. Walker’s temporary assignment as Non-Executive Chairman and the compensation paid for such services are described inNarrative Description of Non-Employee Director Compensation.

Board Oversight of Risk Management

The Board, directly and through its committees, is responsible for overseeing the management of potential risks affecting the Company. In connection with our company-wideoverall risk management process, the Board regularly reviews information provided by senior management about the Company’s strategic, operational, financial and compliance risks. In addition, the chairs of the Audit, Compensation, Nominating/Corporate Governance and Strategy and &

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Technology Committees regularly report to the Board on the activities of their respective Committees,committees, including matters related to risk.

The Audit Committee oversees management of financial risks and receives an annual reportregular reports from management on the Company’s overall risk management structure and processes. The Nominating/Corporate Governance Committee manages risks associated with corporate governance and management succession planning. The Compensation Committee oversees risks related to AAM’s compensation programs. The Strategy & Technology Committee oversees risks related to the Company's strategic plan and AAM’s product,

process and systems technology. The Strategy Committee oversees risk related to the development and implementation of the Company’s strategic plan. Additional review or reporting of specific risks is conducted as necessaryappropriate or as requested by the Board or a Committee.

committee.

Stockholder CommunicationEngagement
Our Board and management team value the opinions and feedback of our stockholders, and we engage with stockholders throughout the Board

year on a variety of issues, including our executive compensation program and corporate governance. Stockholders and other interested parties who wish to communicate with us on these or other matters may contact our Investor Relations Department by email at investorrelations@aam.com or by mail at One Dauch Drive, Detroit, Michigan 48211-1198 (corporate address).

Stockholders or other interested parties may communicate with the Board through the Secretary of AAM by e-mail at AAMBoardofDirectors@aam.com or by mail at One Dauch Drive, Detroit, Michigan 48211-1198 or by e-mail at AAMBoardofDirectors@aam.com.

the corporate address above. The Board has instructed the Secretary to review all such communications and to exercise his discretion not to forward correspondence to the Board that is inappropriate, such as advertising and business solicitations, routine business matters and personal grievances. However, any director may at any time request the Secretary to forward any communication received by the Secretary on behalf of the Board.

Code of Business Conduct

AAM has adopted a Code of Business Conduct that is designed to assist all AAM associates, executive officers and members of the Board in conducting AAM’s business with the highest standards of ethics and integrity. AAM has also adopted a Code of Ethics applicable to our CEO, Executive Chairman, CFO and other Senior Financial OfficersExecutives (Code of Ethics). The Board annually reviews the Code of Business Conduct and makes updates as appropriate. AAM’s Code of Business Conduct and Code of Ethics are available on our website athttp://investor.aam.com. A written copy also may be obtained by any stockholder without charge upon request to the AAM Investor Relations Department by email at investorrelations@aam.com or by mail at One Dauch Drive, Detroit, Michigan 48211-1198 or by email at investorrelations@aam.com.our corporate address above.

Related Person Transactions Policy

The Board has adopted a written policy and procedure for the review, approval and ratification of transactions involving AAM and any “related persons”person” as defined in the policy. This policy supplements AAM’s other conflict of interest policies as set forth in AAM’sour Code of Business Conduct. The Board has delegated to the Audit Committee the responsibilityis responsible for reviewing, approving and ratifying all related person transactions in accordance with the policy.

policy and the Audit Committee's charter.

For purposes of this policy, a related person transaction includes any financial transaction, arrangement or relationship or series of similar transactions, arrangements or relationships in which:

which AAM is or is expected to be a participant;

participant, the amount involved exceeds $120,000;$120,000, and

a related person has or will have a direct or indirect material interest.

However, a transaction between AAM and a related person is not subject to this policy if the transaction:

is available to all employees generally;

involves less than $5,000 when aggregated with all similar transactions; or

involves compensation of an executive officer that is approved by the Compensation Committee.

A related person includes directors and executive officers and their immediate family members, stockholders owning more than five percent of the Company’sCompany's outstanding common stock as of the last completed fiscal year, and any entity owned or controlled by any one of these persons.

A

The Audit Committee makes a determination whether a related person's interest in a transaction is material based on a review of the facts and circumstances. In deciding whether to approve or ratify a related person transaction, meeting the above criteriaAudit Committee will be permitted only iftake into account, among other factors it deems appropriate, (1) whether the transaction is approvedon terms no less favorable than terms generally available to an unaffiliated third party under the same or similar circumstances and (2) the significance of the related person's interest in the transaction.
A member of the Audit Committee may not participate in the review or vote concerning any related person transaction in which the Audit Committee member or his or her immediate family member is involved.
The policy also provides that certain types of transactions are deemed to be pre-approved by the Audit Committee and is on terms comparable to those available to unrelated third parties. Any related person transaction involving a member of the Audit Committee must be presented to disinterested members of the full Board for review.

In considering a transaction, the Audit Committee and/do not require separate approval or the Board may consider the following factors, as applicable:

the Company’s business reasons for entering into the transaction;

the alternatives to entering into a related person transaction;

the potential for the transaction to lead to an actual or apparent conflict of interest and any safeguards imposed to prevent such actual or apparent conflict;

the extent of the related person’s interest in the transaction; and

whether the transaction is in the best interests of AAM.

AAM’s directors and executive officers complete annual questionnaires designed to elicit information about potential related person transactions. In addition, our directors and executive officers are required to report any existing or contemplated related person transaction to the Company Secretary, who also serves as AAM’s General Counsel.

ratification. During fiscal year 2012, the Company did not engage in any reportable related person transactions. As2015 and as of the date of this proxy statement, nothe Company has not engaged in any reportable related person transaction has been brought to the attentiontransactions.


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Board and Committee or the Board.

Board Committee Composition

Meetings

Directors are expected to attend all Board meetings, meetings of the committees on which they serve, and stockholder meetings. Directors are expected to spend the time needed and meet as frequently as necessary to properly discharge their responsibilities. During 2012, all directors attended more than 75 percent of2015, the meetings of the Board and the committees on which they served. The 2012 annual meeting of stockholders was attended by all but one of our directors.

The Board held four regularly scheduled meetings and twoone special meeting. All continuing directors attended 100% of the Board and applicable committee meetings during 2012. 2015, except two continuing directors each missed one committee meeting. No director attended less than 75% of required meetings. Overall attendance at such meetings was approximately 99%. All incumbent directors and nominees attended the 2015 annual meeting of stockholders.

The following table shows thecommittee membership as of the Board’s committees during 2012March 24, 2016 and the number of committee meetings held during 2012.

2015.

COMMITTEE MEMBERSHIP IN 2012AS OF MARCH 24, 2016
Name of Director
Audit
Committee
Compensation
Committee
Nominating/
Corporate
Governance
Committee
Executive
Committee
Strategy & Technology
Committee (1)
David C. Dauch   ChairX
Elizabeth A. Chappell ChairX X
Steven B. Hantler X  X
William. L. Kozyra XX X
Peter D. LyonsX X X
James A. McCaslin XChairXX
William P. Miller IIChair   X
John F. SmithX   Chair
Samuel Valenti IIIXXXXX
No. of Meetings in 2015564—6
(1) The Strategy & Technology Committee was created effective July 30, 2015 as a result of the Board's consolidation of the Strategy Committee and Technology Committee. The number of meetings held by each of these committees during 2015 is as follows: Strategy Committee, 3 meetings; Technology Committee, 2 meetings; and Strategy & Technology Committee, 1 meeting. This change in committee structure is discussed in the

Name of Director Audit
Committee		 Compensation
Committee		 Nominating/
Corporate
Governance
Committee		 Executive
Committee		 Technology
Committee		 Strategy
Committee

Richard E. Dauch

       Chairman   X

Salvatore J. Bonanno, Sr.

         X  

Elizabeth A. Chappell

   X        

David C. Dauch

       X   X

Forest J. Farmer

   Chairman X X    

Steven B. Hantler

   X        

Richard C. Lappin

     X   X Chairman

James A. McCaslin

         X X

William P. Miller II

 Chairman       X  

John F. Smith(1)

 X         X

Larry K. Switzer

 X X       X

Thomas K. Walker(2)

 X X Chairman X    

Dr. Henry T. Yang

         Chairman  

No. of Meetings in 2012

 4 5 6 2 3 2

(1)Mr. Smith was appointed to the Technology Committee effective February 6, 2013.

(2)Mr.Walker’s service on the Technology Committee ended effective April 26, 2012.

Strategy & Technology Committee section below.


Audit Committee

The Audit Committee assists the Board in fulfilling its oversight responsibility with respect to:

the quality and integrity of our financial statements;

our compliance with legal and regulatory requirements;

our independent auditors’ qualifications and independence; and

the performance of our internal audit function and independent auditors.

The Audit Committee operates under aCommittee's responsibilities are more fully described in its written charter, thatwhich is available on AAM’s website athttp://investor.aam.com.

All members of the Audit Committee are independent and financially literate under NYSE listing standards and independent under our Director Independence Guidelines. The Board has determined that each Audit Committee member is independent, is a “non-employee director” within the meaning of Rule 16b-3 of the Securities Exchange Act of 1934 and is financially literate under applicable NYSE listing standards. The Audit Committee hasalso determined that Mr. Miller and Mr. Smith and Mr. Switzer each qualify as an auditare "audit committee financial expertexperts" as defined by SEC rules.

the Securities and Exchange Commission (SEC).

Compensation Committee

The Compensation Committee is responsible forCommittee's responsibilities include the following:

Establishingestablishing and reviewing AAM’s compensation philosophy and programs with respect to ourfor executive officers;

Approvingapproving executive officer compensation with a viewthat is designed to support achievement of AAM’s business strategiesstrategy and objectives;

objectives while considering competitive market practices and stockholder interests;

Approvingapproving corporate goals and objectives for executive officer compensation and evaluating executive officer performance in light of these criteria;


Recommending

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recommending incentive compensation and equity-based plans to the Board;

Overseeingoverseeing management’s risk assessment of the Company’s policies and practices regarding its compensation programs for executive officers and other associates;

Overseeingrecommending non-employee director compensation and benefits to the Board;

overseeing the preparation of the Compensation Discussion and Analysis (CD&A) for inclusion in our annual proxy statement; and

Producingproducing the Compensation Committee Report for inclusion in our annual proxy statement.

The Compensation Committee operates under aCommittee's responsibilities are more fully described in its written charter, thatwhich is available on our website athttp://investor.aam.com. In February 2013,
All Compensation Committee Charter was amended to comply with recently-adoptedmembers are independent under NYSE listing standards, regardingincluding the independence of thestandards applicable specifically to compensation committee members, and our Director Independence Guidelines. All Compensation Committee and its advisors. In accordance with our Corporate Governance Guidelines, the Compensation Committee is also responsible for recommending non-employee director compensation and benefits for approval by the Board.

Each member of the Compensation Committee is independent, is a “non-employee director” within the meaning of Rule 16b-3 of the Securities Exchange Act of 1934, and is anmembers are “outside director”directors” within the meaning of Section 162(m) of the Internal Revenue Code.

Code and are "non-employee" directors within the meaning of SEC Rule 16b-3.

Risk Assessment of Compensation Policies and Practices

In 2012, AAM management

We conducted aan annual risk assessment offor the Company’sCompensation Committee to determine whether the risks arising from our fiscal year 2015 compensation policies and practices relatingare reasonably likely to AAM’s compensation programs for executive officers and other associates. The process used by management to conducthave a material adverse effect on the risk assessment was approved by the Compensation Committee.Company. The risk assessment considered, among other things, AAM’s annual and long-term incentive programs and pay mix, performance measures used to calculate payouts, and pay philosophy and governance. Our annual assessment of compensation-related risks focuses on the program for executive officers in light of their decision-making authority and influence, but also includes a review of the compensation of our other salaried associates. Our risk assessment methodology was reviewed by the Compensation Committee and its independent compensation consultant, Meridian Compensation Partners, LLC (Meridian).
We have designed our compensation programs, including incentive compensation plans, with specific features to address potential risks while rewarding our executive officers and other associates for achieving long-term financial and strategic objectives through prudent business judgment and appropriate risk taking. The following elements have been incorporated in our programs for executive officers:
A balanced mix of compensation components. The target compensation mix for our executive officers is composed of base salary, annual cash incentives and long-term equity incentives, representing a mix that is not overly weighted toward short-term cash incentives.
Multiple performance factors. Our annual incentive and long-term incentive plans include multiple measures of performance. Our use of various performance factors diversifies the risk associated with any single aspect of performance. The performance factors and target award opportunities are established in advance by the Compensation Committee in consideration of the Company's performance goals and objectives and stockholder interests.
Long-term incentives. Our long-term incentives are 100% equity-based and have a three-year vesting schedule, which complements our annual cash incentive plan. Sixty-six percent of long-term incentive awards to executive officers are performance-based. These awards are capped at a maximum payout.
Stock ownership requirements. Our executive officers are required to maintain significant share ownership, which aligns their interests with those of our stockholders.
Clawback policy. Our clawback policy authorizes the Compensation Committee to recoup past incentive compensation in the event of a material restatement of the Company's financial results due to fraud or intentional misconduct of an executive officer.
Based on thisour risk assessment and otherconsideration of various mitigating factors, managementwe concluded that the Company’s compensation policies and practices do not create risks that are reasonably likely to have a material adverse effect on the Company. The Compensation Committee agreed with management’s conclusion.

Role of Management in Compensation Decisions

The Compensation Committee is responsible for making compensation decisions relative to executive officers. However, inIn making itsthese decisions, the Compensation Committee seeks and considers input from senior management. Since management has direct involvement with and in-depth knowledge of the business strategy, goals and performance of the Company, certain executive officers play an important role in the executive compensation decision-making process. Senior management participates in the Compensation Committee’s activities in the following specific respects:


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The Executive Chairman and President & CEO provideprovides the Compensation Committee with their evaluationshis evaluation of the performance of the Company’s executive officers, including the other named executive officers (NEOs). The President & CEO and Vice President, Human Resources make compensation recommendations for executive officers, including base salary levels and the amount and mix of incentive awards.

The President & CEO, the Executive Vice President & CFO and the Vice President, Human Resources develop and recommend performance objectives and targets for AAM’s incentive compensation programs.

The Vice President, Human Resources assists the ChairmanChair of the Compensation Committee in developing meeting agendas and managesoversees the preparation and distribution of pre-meeting informationalmeeting materials on the matters to be considered.

The Executive Chairman,CEO, President, & CEO, Executive Vice President & CFO, and the Vice President, Human Resources and the General Counsel, Secretary & Chief Compliance Officer regularly attend Compensation Committee meetings. Management generally does not attend the executive session of the Compensation Committee. On occasion, the Compensation Committee may request certain members of management to attend all or a portion of an executive session.

Role of Compensation Consultant

The Compensation Committee has retained Meridian Compensation Partners, LLC (Meridian) as its independent compensation consultant. Meridian provides the Compensation Committee with independent advice and ongoing recommendations on compensation matters related to our executive officers and non-employee directors. Meridian also provides the Compensation Committee with competitive market data, peer group analyses and updates on compensation trends and regulatory developments.

In the course of fulfilling its responsibilities, Meridian may communicate directly with the ChairmanChair of the Compensation Committee. Meridian also meets with management to gather information, prepare materials, and review proposals to be made to the Compensation Committee. Meridian provides no other services to the Company other than advice with respect to director and executive officer compensation andthose described above has no other direct or indirect business relationships with the Company ofor any of its subsidiaries or affiliates.

The Compensation Committee determined that Meridian is independent of management and that the services provided by Meridian to the Compensation Committee do not give rise to any conflicts of interest. In written correspondence to the Compensation Committee, Meridian provided detailed information addressing each of the six independence factors adopted by the SEC and incorporated into theset forth in NYSE Corporate Governance Listing Standards.listing standards. In this correspondence and in communications with the Compensation Committee, Meridian affirmed its independence and that of its partners, consultants and employees who service AAM’sthe Compensation Committee on executive compensation matters.

Nominating/Corporate Governance Committee

The Nominating/Corporate Governance Committee’s primary responsibilities are to:

Identifyidentify qualified individuals to serve on the Board and committees;

Reviewreview our Corporate Governance Guidelines and Code of Business Conduct and recommend changes as appropriate; and

Overseeoversee and approve the process for succession planning for the CEO and other executive officers.

The Nominating/Corporate Governance Committee operates under aCommittee's responsibilities are more fully described in its written charter, thatwhich is available on our website athttp://investor.aam.com. Each member All members of the Nominating/Corporate Governance Committee isare independent under NYSE listing standards and is a “non-employee director” within the meaning of Rule 16b-3 of the Securities Exchange Act of 1934.our Director Independence Guidelines.

Selection Process for Director Nominees. In consultation with the Executive Chairman and the President & CEO, the Nominating/Corporate Governance Committee identifies, evaluates and recommends potential candidates for membership on the Board. The Nominating/Corporate Governance CommitteeThis committee conducts necessary and appropriate inquiries into the backgrounds and qualifications of the candidates and considers questions of independence and possible conflicts of interest. Based on the Nominating/Corporate Governance Committee’scommittee’s evaluation, candidates who meet the Board’s criteria may receive further consideration, which may include interviews with the Nominating/Corporate Governance Committeecommittee and other directors. The Nominating/Corporate Governance Committeecommittee then submits its recommendations for nominees to the Board for approval. Pursuant to AAM’s bylaws, the Board may establish the size of the Board by resolution, provided there is a minimum of three members.

Before the Board nominates an incumbent director for re-election by our stockholders, the incumbent director is evaluated by the Nominating/Corporate Governance Committee and/or the Board. This evaluation is based on, among other things, each incumbent director’s meeting attendance record and contributions to the activities of the Board.

After consideration of each incumbent Class II director's qualifications and independence, the committee recommended that the Board nominate Ms. Chappell and Mr. Smith for re-election as Class II directors, each with a term expiring on the date of the 2019 annual meeting of stockholders. Upon review, the Board decided to recommend Ms. Chappell and Mr. Smith for re-election at the 2016 annual meeting of stockholders.


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Pursuant to AAM's by-laws, the Board may establish the size of the board by resolution, provided there is a minimum of three members. In February 2016, the Board determined that the Board shall consist of eight directors as of the date of the 2016 annual meeting.
Director Qualifications. AAM’s Corporate Governance Guidelines provide the qualifications for Board membership. Candidates for director nominees to the AAM Board are reviewed in consideration of the current composition of the Board, the operating requirements of the Company and the interests of stockholders. Although specific qualifications may vary from time to time, desired qualities and characteristics include:

Highhigh ethical character and shared values with AAM;

Loyalty to AAM and concern for its success and welfare;

High-levelhigh-level leadership experience and achievement at a policy-making level in business, or in educational or professional activities;

Knowledgebreadth of knowledge of issues affecting AAM;

Thethe ability to contribute special competencies to Board activities, such as financial, technical, international business or other expertise, or industry knowledge;

Willingness to apply sound, independent business judgment;

Awarenessawareness of a director’sdirector's vital role in AAM’sAAM's good corporate citizenship and corporate image; and

Sufficientsufficient time and availability to effectively carry out a director’sdirector's duties.

The Board as a whole should reflect the appropriate balance of knowledge, experience, skills, expertise and diversity that, when taken together, will enhance the quality of the Board’s deliberations and decisions. Although the Board has no formal policy regarding diversity, the Board believes that diversity is an essential element of Board effectiveness. In this context, diversity is defined broadly to include differences in background, skills, education, experience, gender, race, national origin and culture.

The Nominating/Corporate Governance Committee considers recommendations of potential candidates from members of our Board, our Chairman & CEO and our stockholders. For director candidates recommended by stockholders, the Nominating/Corporate Governance Committee follows the procedures described below inOther Matters, Stockholder Proposals for 20142017 Annual Meeting. The Nominating/Corporate Governance Committeecommittee will evaluate candidates recommended by stockholders using substantially the same criteria as it considersthat are considered in evaluating director candidates recommended by our Board members Executiveor Chairman or President & CEO.

Succession Planning. The Nominating/Corporate Governance Committee is responsible for overseeing the Company’s succession planning process for executive officers and other key executive positions at AAM. In performing this role, the Nominating/Corporate Governance Committeethis committee monitors and approves management’s succession planning process and actions and, with respect to the CEO, makes recommendations to the full Board for approval.

The Board has primary responsibility for CEO succession planning and develops both long-term and contingency plans for CEO succession. In September 2012, the Board implemented its multi-year CEO succession plan with the appointment of Mr. D.C. Dauch as President & CEO. The Company’s co-founder and former CEO, Mr. R.E. Dauch, assumed the role of Executive Chairman of the Board. The Company’s long-term and ongoing succession planning program is designed to support effective senior leadership development and succession in a manner that positions AAM to achieve its strategic, operating and financial performance goals, and enhance stockholder value.

Strategy & Technology Committee
In July 2015, the Board made a key change to its committee structure. By consolidating the Technology Committee and Strategy Committee, the Board created a new Strategy & Technology Committee and appointed all Board members to serve on this committee. This structural change reflects the Board's focus on product, process and systems technologies as an integral part of AAM's business growth strategy.
Effective July 30, 2015, the Strategy & Technology Committee assumed responsibility for the combined duties of the previously separate Technology Committee (formed in 2004) and Strategy Committee (formed in 2012). Accordingly, the Strategy & Technology Committee oversees the development and implementation of AAM’s strategic plan and provides advice to management regarding specific strategic opportunities. This committee also provides oversight and advice to management regarding product, process and systems technologies. Coordination of AAM's strategic plan with the development and acquisition of new technologies is a primary objective of this new committee. In addition, the committee conducts an interactive strategic planning process with management, which includes the committee's approval of strategic goals and objectives and review of potential corporate acquisitions, divestitures, joint ventures and strategic alliances.
Executive Committee

The Executive Committee exercises the authority of the Board during the intervals between Board meetings and does not meet on a regular basis. Its members are identified in theCommittee Membership in 2012 table.

Technology Committee

The Technology Committee oversees and provides advice to AAM regarding AAM’s product, process and systems technology. Its members are identified in theCommittee Membership in 2012 table.

Strategy Committee

The Strategy Committee oversees the development and implementation


15
Table of AAM’s strategic plan and provides advice to management regarding specific strategic opportunities. Its members are identified in theCommittee Membership in 2012 table.

Contents


COMPENSATION OF EXECUTIVE OFFICERS

Compensation Discussion and Analysis

Executive Summary

Effective September 1, 2012, AAM’s Board appointed David C. Dauch as President & Chief Executive Officer, concurrent with the appointment of Richard E. Dauch as Co-Founder & Executive Chairman. Mr. D.C. Dauch most recently served as AAM’s President & Chief Operating Officer since June 2008 and has been a member of the Board since 2009. He has held positions of increasing responsibility since he joined AAM in 1995. Mr. R.E. Dauch has served as CEO since he co-founded the Company in 1994 and as Chairman of the Board since 1997. These actions reflect the Board’s ongoing commitment to succession planning and development of AAM’s leadership team.

On April 26, 2012, the Company’s stockholders approved the 2012 Omnibus Incentive Plan and authorized up to 5 million shares for issuance as equity-based compensation under the plan. This action by our stockholders enabled the Compensation Committee to include equity-based incentives as a component of the Company’s long-term incentive compensation program for executive officers, which we believe strengthens the alignment of interests between our executive officers and our stockholders. Since the expiration of AAM’s previous stock incentive plan in January 2009, the Company has been unable to grant equity-based awards as part of its compensation program. Upon approval of AAM’s 2012 Omnibus Incentive Plan, the Compensation Committee increased the stock ownership requirements for executive officers.

Our executive compensation program reflects an externally competitive compensation structure based on a comprehensive market study of executive compensation programs in AAM’sAAM's comparative peer group. TheIn addition to attracting and retaining key executives, our program includes a mixis designed to drive Company and individual performance while aligning the interests of base salaries and target annual and long-term incentive opportunities. The performance goals under the compensation incentive programs are establishedour executives with those of our stockholders. In order to reward achievement of the Company’s goals and objectives. In 2012, the Company did not perform as expected against its established goals due to increased costs associated with plant closures, global launch activity, lower capacity utilization and labor inefficiencies. As a result, the 2012 payouts for annual and cash-based long-term incentives reflect the lower levels of Company performance pursuant to the metrics established by the Compensation Committee.

When setting compensation for 2013 and in determining compensation policies, the Compensation Committee took into account the favorable results of the stockholder advisory vote onensure that our executive compensation program drives performance in April 2012. Our stockholders approved the compensationsupport of our named executive officers, with approximately 95% of votes cast in favor ofstrategic principles and cultural values, we regularly compare our say-on-pay proposal. Accordingly, the Compensation Committee has continued to apply the executive compensation philosophypractices and objectives described below. The Compensation Committee will continue togovernance against market best practices and consider the outcome of the Company’s say-on-pay votes when making future compensation decisions for our named executive officers.

stockholder feedback.

Named Executive Officers

For purposes of this Compensation Discussion and Analysis and

Our NEOs for the tables and narrative disclosures that follow, Named Executive Officers (NEOs) refer to the following individuals:

fiscal year ending December 31, 2015 are:

David C. Dauch, PresidentChairman & Chief Executive Officer;

Christopher J. May, Vice President & Chief Financial Officer;
Michael K. Simonte, President;
Alberto L. Satine, President Driveline;
Norman Willemse, President Metal Formed Products; and
Terry J. Woychowski, Former Senior Vice President, Advanced Engineering.
Mr. Woychowski's employment with the Company ended effective December 9, 2015. Mr. Woychowski is included as an NEO pursuant to SEC rules. The terms of Mr. Woychowski's separation from the Company are described below in the Narrative to Summary Compensation Table and Grants of Plan-Based Awards Table.
2015 Highlights
Senior Leadership
During 2015, the Board made executive officer appointments that enhance AAM's senior leadership team and reflect our ongoing commitment to succession planning. These key appointments were made effective August 1, 2015.
Mr. Simonte: Mr. Simonte, who was promoted to President, has been with AAM for 17 years, most recently serving as Executive Vice President & Chief Financial Officer;

Richard E. Dauch, Co-Founder & Executive Chairman;

John J. Bellanti, ExecutiveOfficer since 2009. Mr. Simonte served as the Company's Chief Financial Officer since 2006. Mr. Simonte reports to Mr. Dauch.

Mr. May: Mr. May, who was promoted to Vice President Worldwide Operations;& Chief Financial Officer, has been with AAM for over 21 years, most recently serving as Treasurer since 2011. Mr. May has held positions of increasing responsibility in corporate finance, internal audit and

Norman treasury during his career with AAM. Mr. May reports to Mr. Dauch.

Mr. Satine and Mr. Willemse: The senior leadership team was also strengthened with the advancements of Mr. Satine, who was promoted to President, Driveline (most recently serving as Senior Vice President, Driveline Business Unit) and Mr. Willemse, who was promoted to President, Metal Formed Products (most recently serving as Vice President, Metal Formed Products Business Unit.

Unit). Both Mr. Satine and Mr. Willemse joined AAM in 2001 and have served in leadership positions of increasing responsibility over AAM's global operations. Mr. Satine and Mr. Willemse each report to Mr. Simonte.

The Board believes these enhancements to AAM's leadership team further position AAM to meet its strategic business objectives and reinforce AAM's commitment to quality, technology leadership and operational excellence.
Performance and Pay
AAM had an outstanding year in 2015, achieving record sales and gross profit for the year. Strong sales growth, which outpaced the industry for the three-year period ending 2015, and solid operational performance resulted in increased profitability and cash flow. AAM also made measurable progress in diversifying our business. For the three-year period ending 2015, AAM's compound annual growth rate was nearly 20% for non-General Motors sales.
As discussed in more detail below, improvements in the Company's performance in 2015 resulted in higher incentive payouts as compared to 2014 payouts. The 2015 incentive payouts reflect an overall pay-for-

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performance alignment. This result supports AAM's compensation objectives of rewarding performance and aligning the interests of our executive officers with those of our stockholders.
Changes to Executive Compensation Program
In 2015, we made the following key changes to our executive compensation program:
Adopted a change in control (CIC) Plan for executive officers. The CIC Plan provides eligible executive officers with severance benefits only if a qualifying termination of employment occurs within two years of a CIC (double-trigger). Severance benefits under the CIC Plan include, among other things, a cash severance payment equal to a multiple of two times base salary and annual bonus. We adopted this arrangement to reflect the competitive market practice, aid in retention and enable our executive officers to objectively consider corporate transactions that could impact their employment status. Mr. Dauch and Mr. Simonte are entitled to similar CIC severance benefits under each of their employment agreements.
Entered into an amended and restated employment agreement with Mr. Dauch that increased cash severance benefits from two times to three times his annual salary and bonus that would be payable upon a qualifying termination of employment that occurs within two years following a CIC. Mr. Dauch's cash severance benefits were increased to reflect competitive market practice.
Entered into an employment agreement with Mr. Simonte on August 1, 2015 in connection with his appointment as President.
Adopted double-trigger vesting of all equity-based long-term incentive awards in connection with a CIC to reflect best practice.
Amended and restated our 2012 Omnibus Incentive Plan to add 2.1 million shares (approved by our stockholders for issuance under the plan), which will permit us to continue to grant equity compensation to our directors, executive officers and other key executives while maintaining dilution levels within industry practice.
Amended our annual incentive plan to include operating income margin as an additional performance metric for determining payouts to executive officers beginning in 2016. Operating income margin is a key metric that reflects our overall business results. We believe investors consider operating income margin as a factor in evaluating Company performance.
Results of 2015 Say-on-Pay Vote
At our 2015 annual meeting, over 98% of the votes cast were in favor of the Company's say-on-pay proposal. The Compensation Committee (Committee) and the Board considered this favorable outcome as a reflection of our stockholders' strong support of the overall executive compensation program for our NEOs.
What we do....
Emphasize performance-based compensation
A substantial majority of total direct compensation is variable and at risk
Mix of annual and long-term incentives balances the focus between achievement of short-term results and long-term share appreciation
Annual incentive payouts are directly linked to achievement of short-term financial measures
Long-term incentive compensation is 66% performance based
Long-term incentives are designed to drive the Company's long-term success, profitability and growth
Use an independent compensation consultant and peer group analysis
Independent compensation consultant annually performs market study of pay and best practices
Compensation consultant provides independent advice to the Compensation Committee
•
Total direct compensation targeted at 50th percentile of pay among our peer group
Mitigate undue risk in compensation programs
All incentive award payouts are capped
A risk assessment of compensation programs is performed annually
Clawback policy ensures accountability
Enforce stock ownership requirements for executive officers
CEO stock ownership requirements are 5 times annual base salary
Other NEO stock ownership requirements are 2 to 3 times annual base salary

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Utilize double-trigger change-in-control plan
Severance payments and vesting of equity awards require both a change in control and a qualifying termination of employment
What we don't do....
No hedging or pledging of Company stock
No excise tax gross-ups
No excessive perquisites
No excessive change-in-control or executive severance provisions
Executive Compensation Philosophy and Objectives

The Compensation Committee is responsible for establishing and reviewingdetermines the overall compensation philosophy of the Company. The Compensation Committee believes that the compensation paid to executives should be structured to provide AAM executives with meaningful rewards, while maintaining alignment with stockholder interests, corporateour cultural values and management initiatives.

The Compensation Committee believes thatstrategic principles. Accordingly, AAM’s executive compensation program should consistconsists of a mix of base salary, annual incentive compensation and long-term incentive compensation, with limited perquisites and other personal benefits. One of the key objectives of establishing a mix of base salaries, annual incentive and long-term incentive compensation is to have aA significant portion of total direct compensation be performance basedis performance-based and contingent upon the achievement of stated Company performance goals.

In an effort to more closely align the objectives of the philosophy to market competitive practices, the Compensation Committee has established stated target percentile goals (compared to our comparative peer group) for each component of pay as set forth below underMarket Analysis and Benchmarking. The pay percentile goals are generally used as a guide to help set compensation levels for the NEOs, excluding the Executive Chairman. The Executive Chairman’s compensation is determined under his employment agreement.

The Compensation Committee also considers other factors in setting compensation levels for the NEOs, including, among other things, individual performance, succession planning and the requirements of the position as determined by the Company from time to time.

Compensation Objectives.The following fundamental objectives are considered in determining compensation programs and pay levels.

Compensation and benefit programs should appropriately reflect the size and financial resources oflevels for our Company in order to maintain long-term viability. These programs should be market-based to be competitive relative to the compensation paid to similarly situated executives in our peer group.NEOs.


Compensation and benefit programs should attract, motivate and retain experienced executives who are vital to our short-term and long-term success, profitability and growth.growth. AAM makes an effort to remain competitive by targeting competitive pay levels based on the Company’s compensation philosophy with consideration of the specific business environmentour comparative peer group while considering industry conditions and other market influences. Our compensation programs should encourage high-achieving, marketable executives to remain motivated and committed to AAM for long and productive careers.


Compensation and benefit programs should reward Company and individual performance.performance. Our compensation programs should strive to deliver competitive compensation for exceptional individual and Company performance as compared to companies in our comparative peer group. As associatesexecutives progress to higher levels in the Company and assume keylevel leadership positions, a greater portion of their compensation should beis linked to Company performance and stockholder returns. Company performance is measured against financial and operational objectives and to stockholder return.returns.


Compensation and benefit programs should foster the long-term focus required for success in the global automotive industry. We believe thatto deliver value to our stockholders. Our long-term incentive compensation will motivateprogram motivates executive officers to achieve our strategic objectives and deliver long-term value creation to our stockholders. ExecutivesExecutive officers who are in positions to influence longer-termlong-term results should have a greater proportion of their compensation tied to longer-termlong-term performance.


Executive officers Total compensation opportunities should be AAM stockholders. Stock ownership aligns our executive officers’ interests with those of stockholders and reinforces the importance of making sound long-term decisions. AAM’s executive officers are required to maintain a certain level of stock ownership based on their position.reflect

The objectives of rewarding performance and retention should be balanced. Our compensation programs should continue to ensure that high-achieving, marketable executives remain motivated and committed to AAM. This principle is essential to our effort to encourage our strongest leaders to remain with AAM for long and productive careers.

Compensation and benefit programs should be fair in consideration of each executive’s level of responsibility and contribution to AAM. While the overall structure of compensation and benefit programs should be broadly similar across the Company, individual pay levels and benefit packages will reflect differences in job responsibilities, geography and marketplace considerations.


Market AnalysisStock ownership requirements for executive officers should align their interests with those of our stockholders. Our stock ownership requirements align our executive officers’ interests with those of stockholders and reinforce the importance of making sound long-term decisions. AAM’s executive officers are required to maintain a certain level of stock ownership based on their position.

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Peer Group and Compensation Benchmarking

Determination of Comparative Peer Group.    AGroup
The Committee uses a comparative peer group of 38 industrial manufacturing companies drawn from a broad array of industries, including automotive suppliers, was identified by Meridian, the Compensation Committee’s independent compensation consultant, for consideration by the Compensation Committee to help assessin determining competitive pay levels and compensation structure, setting incentive pay opportunities and assessing Company performance relative to provide data for pay decisions.its peers in support of AAM's executive compensation philosophy and objectives. The peer group was selected to be representativeCommittee annually reviews the composition of a broad industrial sector in which AAM competes for executive talent. The criteria used to assess the market and to select the comparative peer group included:

Operating/Industry Competitors — Companies with which we compete forand makes adjustments to reflect changes in the sale of productsCompany's business as well as industry and services;

market conditions.

Labor Market Competitors — Companies with which we compete for executive talent;

Competitors for Capital — Companies with which we compete for investment dollars and against which investment performance is evaluated; and

Revenue Size — Companies with revenues within a broad range.

Based on the foregoing criteria, the Compensation Committee established the followingOur current comparative peer group to be used for pay decisions:

consists of the following companies:

A. O. Smith Corporation

Flowserve CorporationTower International Inc.
BorgWarner Inc. *
Kennametal Inc.Trinity Industries, Inc.
Briggs & Stratton
Lear Corporation *
USG Corporation
Cooper-Standard Holdings, Inc.
Meritor Inc. *
Valmont Industries, Inc.
Dana Holding Corporation *
Regal-Beloit Corporation
Visteon Corporation *
Donaldson Company, Inc.
Tenneco Automotive Inc. *
Woodward Inc.
Federal-Mogul CorporationTerex Corporation
 

Kennametal Inc.

Ball Corporation

Lear Corporation

* Included in our competitor peer group as disclosed in our 2015 annual report to shareholders.

BorgWarner  Our competitor peer group also includes Autoliv Inc.

Meritor and Magna International Inc.

Brady Corporation

Navistar International

Cameron International Corporation

Owens-Illinois, Inc.

Cummins Inc.

PACCAR Inc.

Dana Corporation

Polaris Industries Inc.

Donaldson Company, Inc.

Rockwell Automation

Dover Corporation

Sauer-Danfoss Inc.

Eaton Corporation

Sonoco Products Company

Federal Signal Corporation

Terex Corporation

Federal-Mogul Corporation

Thomas & Betts Corporation

Fleetwood Enterprises, Inc.

The Timken Company

Flowserve Corporation

Trinity Industries, Inc.

FMC Technologies

TRW Automotive Holdings Corp.

Genuine Parts Company

USG Corporation

Harley-Davidson Motor Company

Valmont Industries, Inc.

Ingersoll-Rand Company

Visteon Corporation

Joy Global Inc.

Woodward Governor Company

The Compensation Committee relied on the market data analysis performed by Meridian in October 2010 for setting 2011 and 2012 executive officer compensation. Meridian’s market analysis in 2010

was considered adequate for setting 2012 payselected this peer group based on Meridian’s guidance tofrom the Committee's independent compensation consultant, Meridian Compensation Committee that levels of compensation among ourPartners, LLC (Meridian). Our comparative peer group had not changed significantly from 2010 to 2012. includes companies in automotive and related industries with comparable (1) revenues (between one-third and three times our revenues), (2) complexity of global business and operations and (3) market capitalization. This group also includes companies that compete with AAM for executive talent and companies included in the proxy advisory firms' peer groups. AAM's projected revenues are at approximately the median of the comparative peer group's projected revenues.

Compensation Benchmarking
The market data was revenue size adjusted using regressed market values.

Our general practice is to setCommittee targets total direct compensation at market competitive levels based onapproximately the responsibilities, expertise and experience50th percentile of each NEO as well as individual and Company performance. The total compensation for each NEO (other than the Executive Chairman) and each pay component described below are compared to pay levels of executives holding similar positions at companies in our comparative peer group. The Committee believes that this approach reflects a generally accepted benchmark of external competitiveness and supports our ability to attract and retain key executives.

Total direct compensation consists of base salary plus target percentile goalsannual and long-term incentive compensation. Total direct compensation for each NEO may be above or below the 50th percentile of our comparative peer group based on various factors, including an individual's level of responsibility, demonstrated skills and experience, significance of position, contribution to Company performance, time in position, potential for advancement and internal pay component are as follows:

Pay ComponentTarget Percentile Goal

Base Salary

50th  Percentile

Annual Incentives

Between  50th and 75th Percentiles

Long-Term Incentives

Between 50th and 75th Percentiles

equity considerations. The percentile goalsCommittee generally sets performance objectives for annual incentives and long-term incentives were set between the 50th percentile and the 75th percentile to enable the Company to reward executiveincentive compensation so that targeted total direct compensation levels can be achieved only when target performance at a rate above average in order to drive above averageobjectives are met. Consequently, actual pay may vary from targeted levels based on achieved performance and to compete for executive talent.

Competitor Peer Group.    The Compensation Committee also considers, from time to time, publicly available information regarding companies in our competitor peer group in establishing certain executive compensation benchmarks, targets andagainst pre-established performance levels. As disclosed in our most recent Annual Report on Form 10-K, our competitor peer group consists of Autoliv Inc., BorgWarner Inc., Dana Corporation, Lear Corporation, Magna International Inc., Meritor, Inc., Tenneco Automotive Inc. and Visteon Corporation.objectives.

Tally Sheets

Annually, the Compensation Committee reviews compensation tally sheets for each executive officer, including the NEOs. The tally sheets, which are prepared by management, provide a summary of the current amounts of each component of pay includingand a historical reviewhistory of prior long-term incentive grants. The tally sheets also provide a summaryshow estimates of the potential payoutspayments and benefits uponthat could be realized under various hypothetical termination events.scenarios. The elements and calculations reviewed aretally sheets consist of information that is substantially similar to the information providedshown for each NEO inPotential Payments Upon Termination or Change in Control below. The Compensation Committee did not change the NEOs’ compensation based on its review of this information.information in 2015.


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Total NEO Total Direct Compensation Pay Mix
The following chart illustrates the allocation of 2015 total direct compensation components at target for our CEO and for our other NEOs as a group as of December 31, 2015. This analysis highlights the Company's emphasis on long-term and at-risk compensation.
Total NEO Compensation
For 2015, the Committee set total direct compensation for Mr. Dauch and Mr. Simonte at approximately the 50thpercentile of the peer group. At the time of Mr. May's appointment as CFO, the Committee set his total direct compensation below the 50th percentile, subject to further review in 2016. The levels of total direct compensation for Mr. Satine and Mr. Willemse were determined in consideration of internal pay equity based on their positions. Accordingly, total direct compensation was set below the 50th percentile of the peer group for Mr. Satine and above the 50th percentile for Mr. Willemse.

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Components of the AAM Compensation Program

The primary components of AAM’s executive compensation program for 2015 are base salary, annual incentives, long-term incentives, and benefits and perquisites.

summarized below:

ComponentKey CharacteristicsPurpose
Base Salary
* Part of competitive total compensation package
* Determined based on market comparative positions and individual performance, experience, time in position, professional development, contributions to the Company and internal equity considerations
* Provides base level of cash compensation for attracting and retaining executive talent
Annual Incentive Compensation
* Determined based on pre-established financial performance factors, including:

- Net income as a % of sales (50%) and
- Net operating cash flow (50%)
* Provides an opportunity to earn a cash-based annual incentive award

* Aligns with financial performance

* Target awards vary based on position and other factors
Long-Term Incentive Compensation
Performance Shares (66%)
* Performance Shares tie a substantial portion of total compensation to the Company's future achievement of pre-established performance goals over a three-year performance period, including:

- EBITDA (33%)
- Relative TSR (33%)
 * Aligns the interests of executive officers with those of shareholders by providing a mix of equity compensation tied to financial and share performance

* Combined with the Company's vesting and stock ownership requirements, as well as a clawback feature, equity-based awards balance the goals of encouraging sustainable results over time and reward those results with appropriate levels of actual compensation

* Total target awards vary based on position and other factors
Restricted Stock Units (34%)* Restricted Stock Units align awards with stock price performance and encourage executive retention with vesting after a three-year period
Retirement Benefits and Deferred Compensation* Includes qualified and nonqualified defined benefit and defined contribution plans, as well as a nonqualified retirement plan and deferred compensation plan* Provides income upon retirement including tax-deferred methods for general savings
Perquisites* Primarily consists of the use of a Company-provided vehicle with AAM content* Provides a limited supplement to total direct compensation

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Base Salary.    The Compensation In the fourth quarter of each year, the Committee based its 2012 salary determinationsreviews base salaries for executive officers for the NEOs (other thanfollowing calendar year. In determining 2015 base salaries for executive officers, the Executive Chairman) by reference to the 50th percentileCommittee reviewed benchmark data comparing pay levels of our executive officers with those of executives holding similar positions at companies in our comparative peer group. The Committee considered the recommendations of Mr. R. E. Dauch in determining other NEO base salaries. The Committee approved 2015 base salaries as follows:
  Base Salary
  2015 2014
David C. Dauch $1,150,000
 $1,100,000
Christopher J. May (effective August 1, 2015) $350,000
 NA
Michael K. Simonte (effective August 1, 2015) $640,000
 $560,100
Alberto L. Satine (effective August 1, 2015) $510,000
 $450,000
Norman Willemse (effective August 1, 2015) $450,000
 $385,000
Terry J. Woychowski (through December 9, 2015) $463,500
 $463,500
Mr. Dauch's base salary was adjusted to $1,150,000 effective January 1, 2015. The Committee approved this increase of 4.5% in consideration of the Company's financial performance and Mr. D.C. Dauch were also consideredDauch's leadership in determining 2012strengthening AAM's management team and advancing product technology and innovation.
For Mr. May, the Committee determined his base salaries for the other NEOs. These recommendations were based on each individual’s experience, time in position, professional development, contribution to the Company, performance and other factors. The Compensation Committee approved 2012 increases for each of our NEOs (other than the Executive Chairman)salary upon his appointment as follows:

   Base Salary 
   2012   2011 

David C. Dauch (effective September 1, 2012)

  $1,000,000    $650,000  

Michael K. Simonte

  $527,900    $515,000  

John J. Bellanti

  $485,700    $473,800  

Norman Willemse

  $310,600    $303,000  

President & CEO Base Salary.    Effective September 1, 2012, the Board appointed Mr. D.C. Dauch President & CEO. The Company entered into an employment agreement with Mr. D.C. DauchCFO on August 27, 2012 in connection with this appointment.1, 2015. The Committee initially set Mr. D.C. Dauch’s baseMay's salary as President & CEO is $1 million.

In determining Mr. D.C. Dauch’s base salary, the Compensation Committee considered CEO base salary benchmarking data provided by Meridian from the comparative peer group established by the Compensation Committee for purposes of setting executive compensation as shown inMarket Analysis and Benchmarking above. In addition, management provided the Compensation Committee with publicly available CEO pay information for members of the Company’s competitor peer group. Based on Meridian’s analysis, Mr. D.C. Dauch’s base salary is atbelow the 50th percentile of CEO pay among our comparative peer group.

Effective January 1, 2012 through August 31, 2012,based on Mr. D.C. Dauch’sMay being new to the CFO position. The Committee made this determination subject to further review in 2016. In connection with their new appointments, other NEOs received base salary (as President & COO) was $810,000. This amount reflected an increase from $650,000 due to the additional responsibilities he assumed on December 1, 2011 in the areas of finance, information technology and investor relations. In determining his 2012 base salary while servingincreases as President & COO, the Compensation Committee also considered his leadership role in connection with the Company’s ongoing succession planning process.

Other NEO Base Salaries.    The increases in 2012 base salary shown above forfollows: Mr. Simonte, 11%; Mr. BellantiSatine, 10%; and Mr. Willemse, represent10%. Mr. Simonte and Mr. Satine also received an annual merit increasesincrease of 2.5%. Based on Meridian’s market data analysis,3%, which is consistent with the budgeted amount for the merit program for U.S. salaried associates. Mr. Simonte’s 2012Willemse also received a 6.5% increase, which reflects the annual merit increase and an adjustment for internal pay equity as discussed above. The Summary Compensation Table shows the base salary is between the 50th and 75th percentile of CFO pay among our comparative peer group. Mr. Simonte’s pay level reflects, among other things, his additional leadership responsibilitiesearned in functional areas outside the finance organization. Mr. Bellanti’s and Mr. Willemse’s 2012 base salaries are at the 50th percentile of pay2015 for their positions among our comparative peer group. Mr. R.E. Dauch’s compensation is discussed below inCompensation of Executive Chairman.each NEO.

Annual Incentive Compensation.    Annual incentive compensation at AAM is designed to:Compensation

Encourage executives to achieve short-term goals to foster achievement of the long-term goals of the Company;

Reward performance to support strategic initiatives; and

Provide incentive for executive retention.

Annual.Each NEO's annual incentive compensation is measuredbased on achieved results against pre-established financial targets approved by our achievement of financial targetsthe Committee and established under AAM’s Incentive Compensation Plan for Executive Officers. All executive officers (other than the Executive Chairman) participated in this plan during 2012. On an annual basis, the Compensation Committee determines one or more performance factors, and the relative weighting of each factor, in consideration of the Company’s key performance objectives. Under the plan, the performance factors

that may be selected are (1) net income as a percentage of sales (NIPS), (2) after tax return on invested capital (ROIC) and (3) net operating cash flow. ROIC is defined as after-tax return divided by average invested capital. Net operating cash flow is defined as cash provided by or used in operating activities less capital expenditures. Target performance levels, established annually, are intended to be aggressive but achievable based on industry conditions.

Payment of annual cash incentive awards are permitted to the extent the Company both (1) meets or exceeds threshold performance levels of performance set by the Compensation Committee and (2) reports positive net income for the performance year.income. The plan permits the Compensation Committee tomay make discretionary adjustments if it determines that the achievement of performance targets for a plan year do not reflect the true performance of the Company due to unanticipated circumstances specified in the plan. Annual


The 2015 annual incentive awards may be increased or decreased by the Compensation Committee, based on the recommendations oftargets for Mr. R.E. DauchMay, Mr. Simonte, Mr. Satine and Mr. D.C. Dauch.

Willemse were increased in connection with their appointments to new positions. The following table summarizesbelow shows the 20122015 target annual incentive opportunities for theour NEOs, (other than the Executive Chairman), stated as a percentage of base salary:

Annual Incentive
Opportunity

David C. Dauch (effective September 1, 2012)

125% 

Michael K. Simonte

80% 

John J. Bellanti

80% 

Norman Willemse

60% 

President & CEO Annual Incentive Target.    Pursuant to his employment agreement, Mr. D.C. Dauch’s target annual incentive opportunity is 125% of base salary. His target annual incentive opportunity for the period January

 Target Annual Incentive Opportunity
 20152014
David C. Dauch125%125%
Christopher J. May54%NA
Michael K. Simonte88%80%
Alberto L. Satine68%60%
Norman Willemse68%60%
Terry J. Woychowski60%60%

Effective August 1, 2012 through August 31, 2012 was 90% of base salary. In determining Mr. D.C. Dauch’s target annual incentive opportunity effective September 1, 2012, the Compensation Committee considered, among other things, the pay levels for CEOs among AAM’s competitor peer group as described inPresident & CEO Base Salaryabove. Based on a market analysis conducted by Meridian, Mr. D.C. Dauch’s target annual incentive opportunity is 6% above the 75th percentile of CEO pay among our comparative peer group. The Compensation Committee considered this level to be appropriate in consideration of his target long-term incentive opportunity, which is at the 50th percentile of our comparative peer group.

Other NEO Annual Incentive Targets.    The Compensation Committee considers Meridian’s market analysis in determining2015, the annual incentive target opportunitiesopportunity for the other NEOs. The 2012 annual incentive target opportunities forcertain NEOs was increased as follows: Mr. May, from 50% to 60%; Mr. Simonte, from 80% to 100%; Mr. BellantiSatine and Mr. Willemse areWillemse; each between the 50th and 75th percentile for comparable positions among our comparative peer group. Mr. R.E. Dauch’s annual bonus is discussed below inCompensationfrom 60% to 80%.


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2012Contents


2015 Annual Incentive Performance

In support of the Company’s 20122015 goals and objectives, the Compensation Committee approved the use of net operating cash flow and NIPS,net income as a percentage of sales (NIPS), each with equal weighting, as the performance metrics for determining 20122015 annual cash incentives. Net operating cash flow and NIPSThese performance metrics were selected as performance metrics for the following reasons:

Netnet operating cash flow is a criticalan important financial metric for AAM at this time due to its impact on liquidity, debt reduction and debt reduction;

stockholder value creation;

Increasingincreasing net operating cash flow is key to achieving credit rating upgrades, which will havehas a favorable impact on the Company’s cost of future financing;

and

Netnet income is a key indicator of financial and operational performance; and

performance.


Net income and net income growth are highly correlated tooperating cash flow is defined as net cash flow growthprovided by or used in operating activities less capital expenditures net of proceeds from the sale of property, plant and stockholder value creation.

equipment and from government grants.


In the fourth quarter of 2011,2014, in conjunction with a review of the Board-approved annual budget, the Compensation Committee determined the 2012set 2015 performance targets for both the net operating cash flow and NIPsNIPS performance metrics. The 2012 targets for each performance metric aremetrics as follows:

   Net Operating
Cash Flow		  Net Income as a
Percentage of  Sales
   Performance  Payout  Performance  Payout

Threshold

  $0  50%  1%  30%

Target

  $26 million  100%  3%  100%

Maximum

  $51 million  125%  >3%  >100%

The budgeted


  
Net Operating
Cash Flow
 
Net Income as a
Percentage of  Sales
  Performance Payout Performance Payout
Threshold $50 million 25% 1.5% 25%
Target $175 million 100% 4% 100%
Maximum $275 million 200% 6% 200%
Budgeted net operating cash flow for 2015 was $1$175 million. Generating positive cash flow was a critical objective for 2015. Accordingly, the threshold performance level was set at $50 million. The target performance level for net operating cash flow was based on the Company outperformingachieving the budget by $25 million;and the maximum performance level was based on outperforming the budget by $50 million. No payout would be made with respect to the net operatingbudgeted cash flow metric unless the threshold was attained.

by $100 million. The target and threshold performance levels for NIPS were determined based on theour performance ofrelative to our competitor peer group. The target performance level for NIPS, or 3%4%, was set at a level to meet the performance of the top one-thirdmedian net income of our competitor peer group for the three most recent fiscal years. There is no establishedThe maximum award opportunity for NIPS. The Compensation Committee approved this approachNIPS was set at a level to meet the performance in the top one-third of our competitor peer group. Target performance levels are intended to be aggressive but achievable based on the correlation of net income growth to cash flow growth and stockholder value.

industry conditions.

The Company’s 20122015 net operating cash flow performance was a use of $383.1 million, which is lower than$189.5 million. Accordingly, the breakeven threshold level. Accordingly, no payout was made for 2012 based on this net operating cash flow metric.metric resulted in the achievement of 114% of target payout. The Company’s 20122015 NIPS was 3.1 %,6.05%, excluding the impact of the reversaldebt redemption costs, net of the deferred tax, valuation allowance and the costs associated with plant closures and debt refinancing activities.of approximately $0.5 million. Accordingly, the NIPS performance metric resulted in an achievement of 102%200% of target.
Based on the weighting of each performance metric, the 20122015 annual incentive awards resulted in a payout of 51%157% of target. For Mr. D.C. Dauch and Mr. Simonte, the Compensation Committee approvedNo discretionary adjustments were made to 2015 annual incentive payouts of 53% and 52% of target, respectively. The Compensation Committee made these discretionary adjustments to the payouts for Mr. D.C. Dauch and Mr. Simonte in consideration of their leadership and contributions to the Company during 2012. For Mr. D.C. Dauch, the Committee considered AAM’s strong sales growth of 13.4% on a year-over-year basis and new business awards resulting in a new business backlog of $1.25 billion for 2013-2015. For Mr. Simonte, the Committee considered the completion of key financing initiatives that provided additional liquidity to fund AAM’s sales growth, extended the debt maturity profile of AAM’s debt capital structure and allowed AAM to improve the funded status of our global pension plans.any NEO. The annual incentive awards paid to the NEOs are shown in theSummary Compensation Table.

2016 Amendment & Restatement of Annual Incentive Plan
In February 2016, the Committee approved the use of operating income margin as an additional performance measure for annual incentives awarded under the Annual Incentive Plan for Executive Officers. The Committee selected this additional performance measure based on a market analysis performed by Meridian that compared the performance metrics used by AAM under our annual incentive plan to the performance metrics used by companies in our comparative peer group and among a broader industry group. As a result, the Committee decided to maintain the existing performance measures and add operating income margin, a pre-tax earnings measure under the plan. Accordingly, the Second Amended & Restated AAM Annual Incentive Plan for Executive Officers was adopted effective January 1, 2016 and filed as Exhibit 10.38 to our annual report on Form 10-K for the fiscal year ended December 31, 2015.

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Long-Term Incentive Compensation. Long-term incentive compensation at AAM is designed to:

Align executive officer and stockholder interests;

Reward achievement of long-term performance goals; and

Provide incentives for executive retention.

The following table summarizes 2012below shows the 2015 target long-term incentive award targetsopportunities for our NEOs:

 2015 Target Long-Term Incentive Opportunity
 
($)(1)
 
%(2)
David C. Dauch4,312,500
 375%
Christopher J. May148,320
 60%
Michael K. Simonte1,153,800
 200%
Alberto L. Satine556,200
 120%
Norman Willemse410,000
 100%
Terry Woychowski540,000
 120%

(1) Amounts reflect the value the Committee considered when granting the awards for 2015. These amounts differ from the value of the awards shown in the 2015 Summary Compensation Table and Grants of Plan-Based Awards Table because those tables reflect the probable outcome of the performance metrics for the NEOs (other than the Executive Chairman), statedperformance shares.
(2) Stated as a percentage of base salary:

Long-Term Incentive
Target

David C. Dauch (effective September 1, 2012)

240% 

Michael K. Simonte

120% 

John J. Bellanti

120% 

Norman Willemse

80% 

President & CEO Long-Term Incentive.    Prior to September 1, 2012, salary.


Mr. D.C. Dauch’s 2012 long-term incentive target opportunity was 180%. Under his employment agreement, Mr. D.C. Dauch’s target long-term incentiveDauch's LTI opportunity was increased to 240%. In determining Mr. D.C. Dauch’s target long-term incentive opportunity, the Compensation375% from 350% of base salary effective January 1, 2015. The Committee considered, among other things, target awards for CEOs in AAM’s competitor peer group.

Upon his appointment as President & CEO on September 1, 2012, Mr. D.C. Dauch received a long-term incentive award consisting of restricted stock units and cash-based performance units. The restricted stock unit award had a grant date value of $250,000 and the performance unit award had a target value of $250,000. The Board approved this one-time award upon executionincrease in consideration of the Company's financial performance and Mr. D.C. Dauch’s employment agreementDauch's leadership in strengthening AAM's management team and advancing product technology and innovation. Mr. Dauch's LTI opportunity was increased to provide him400% for 2016 based on the market benchmark study provided by Meridian.


For Mr. Simonte, Mr. Satine, Mr. Willemse and Mr. Woychowski, 2015 LTI targets were not changed from 2014. Mr. May's 2015 LTI target was determined based on his prior position as Treasurer. The target opportunities for Mr. May (100%), Mr. Simonte (230%), Mr. Satine (150%) and Mr. Willemse (150%) were increased for 2016 awards in connection with a long-term incentive awardtheir appointments to new positions.
2015 Long-Term Incentives
The Committee determined the LTI program and each NEO's target LTI opportunity thatfor 2015 in consideration of peer group data, market trends, pay-for-performance alignment and executive retention. Under the Compensation Committee considered appropriate for his new position.

The restricted stock unit award is payable2015 LTI program, each NEO was granted performance shares of 66% and RSUs of 34% of the NEO's target LTI value. RSU awards vest in common stockfull on the third anniversary of the grant date contingent upon continued employment with the Company. The performance unit award isand are payable in cash, based on the Company’sshares.

Performance share awards are subject to two equally weighted three-year performance metrics: (1) cumulative earnings before interest, taxes, depreciation and amortization (EBITDA) performance during the July 1, 2012 through June 30, 2015 performance period.margin and (2) relative total shareholder return (TSR). The threshold, target and maximumCommittee selected EBITDA performance levels for determining the performance award payout are shown in theEBITDA Performance Measure table below.

Other NEO Long-Term Incentive Targets.    The Compensation Committee considers Meridian’s market analysis in determining the long-term incentive target opportunities for the other NEOs. The long-term incentive target opportunities for 2012 for Mr. Simonte, Mr. Bellanti and Mr. Willemse are currently below the 50th percentile for comparable positions among our comparative peer group of companies. Mr. R.E. Dauch’s one-time long-term incentive award is discussed below inCompensation of Executive Chairman.

2012 Long-Term Incentives

In April 2012, the Company received stockholder approval of the 2012 Omnibus Incentive Plan, which authorized the Company to issue equity-based long-term incentives and other types of awards. In May 2012, the Company granted the NEOs equity-based and cash-based long-term incentives under the 2012 Omnibus Incentive Plan as described below.

The Compensation Committee determined the form and mix of awards in consideration of AAM’s compensation objectives, current market practice and share usage under the Company’s 2012 Omnibus Incentive Plan.

One-half of the total 2012 long-term incentive award value for NEOs (other than the Executive Chairman) was in the form of restricted stock units (RSUs) and one-half was in the form of cash-based performance units (PUs) with a notional value of one dollar. The RSUs are payable in common stock, contingent upon continued employment through the three-year vesting period. The RSUs were designed to provide opportunities for share ownership and motivate executive officers to build long-term value for our stockholders.

The PU target award payment will be determined based on the Company’s EBITDA performance from April 1, 2012 through December 31, 2014. The PU awards were designed to align executive officer performance goals with those of the Company. EBITDA was selected as the performance measure based on the Compensation Committee’s belief that EBITDAmargin because it is a key indicator of the Company’sour financial and operational performance and is useful in analyzing entity valuation.

The termsCommittee selected relative TSR because of its alignment with stock price performance. This TSR performance metric is designed to motivate executive officers to build long-term value for our stockholders. The EBITDA and relative TSR performance measures also complement the RSU and PU awards are described in more detail in theNarrativemetrics we use to Summary Compensation Table and Grants of Plan-Based Awards Tablebelow.

determine payouts under our annual incentive program.

The following table illustratesshows the threshold, target and maximum EBITDA margin and relative TSR performance levels forto be used in determining 2012 PU award2015 performance share payouts. The EBITDAThese performance levels shown below were designed to drive a level of performance in the top one-half of our competitor peer group.

The competitor peer group consists of companies listed above in Peer Group and Compensation Benchmarking.

 EBITDA Margin Performance MeasureRelative TSR Performance Measure
Performance Level
3 Year Cumulative
EBITDA Margin
Percent of
Target Award
Opportunity Earned
Company's TSR Percentile Rank
Percent of
Target Award
Opportunity Earned
Threshold10%25%
35th
50%
Target12%100%
50th
100%
Maximum15%200%
75th
200%

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Payout of 2013 Performance Unit Awards
Payouts of the 2013 cash-based performance unit awards were determined based on EBITDA margin for the performance period beginning January 1, 2013 through December 31, 2015. The Company's cumulative EBITDA margin for the performance period was 13.9%, after adjustments approved by the Committee for certain special charges, including debt refinancing costs and the payout of certain terminated vested participants under our defined benefit U.S. pension plans. The adjusted EBITDA margin resulted in a payment at 163% of target. See Summary Compensation Table for the amounts paid to NEOs (other than Mr. May) in March 2016.
Payout of 2012 Performance MeasureUnit Award
The payout of a 2012 cash-based performance unit award to Mr. Dauch was determined based on EBITDA margin for the performance period beginning July 1, 2012 through June 30, 2015. The Company's cumulative EBITDA margin for the performance period was 13.1% after adjustments approved by the Committee for certain special charges, including debt refinancing costs and the payout of certain terminated vested participants under our defined benefit U.S. pension plans. The adjusted EBITDA margin resulted in a payment at 135.4% of target. See

Performance Level

  33-Month Cumulative
EBITDA		  Percent of
Target Award
Opportunity Earned		 

Threshold

   10%   25% 

Target

   12%   100% 

Maximum

   15%   200% 

Summary Compensation Table for the amount paid to Mr. Dauch in August 2015.

Equity Grant Practices

AAM generally makes equity grants to its executive officers and other executives on an annual basis, subject to the approval of the Compensation Committee. Historically, grants have beenGrants are typically made in the first quarter of each year to coincide with the communication to executive officers and other executives of their annual cash incentive awards for the previous year’s performance. This timing increases the impact of the awards by strengthening the link between pay and performance. In 2012, the annual grant of equity awards was delayed until May, which followed stockholder approval of the 2012 Omnibus Incentive Plan. On September 1, 2012, equity awards were granted to Mr. D.C. Dauch and Mr. R.E. Dauch in conjunction with the execution of their employment agreements. AAM does not and has never permittedallowed backdating, spring loading or other timing of option grants with the release of material non-public information.

Prior Long-Term Incentive Awards under the AAM 2009 Long-Term Incentive Plan

Prior to adoption of the 2012 Omnibus Incentive Plan, the Company’s Currently, stock options are not used as a vehicle for long-term incentive program consisted of cash-based performance awards made under the AAM 2009 Long-Term Incentive Plan (2009 AAM LTIP).

Payouts of the 2010 cash-based performance awards were determined based on EBITDA and TSR for the performance period beginning January 1, 2010 through December 31, 2012. The Company’s cumulative EBITDA percentage for the performance period was 13.8%, after adjustments approved by the Compensation Committee for certain special charges, including asset impairments, costs associated with plant closures and debt refinancing costs in accordance with the discretion provided to the Compensation Committee in the plan. The adjusted EBITDA percentage resulted in a payment at 159% of target. The Company’s TSR for the performance period ranked above the 35th percentile of our competitor peer group and resulted in a payout of 82% of target. Based on the 50% weighting of EBITDA and TSR performance, total award payments were approximately 120% of target for each NEO (other than the Executive Chairman). SeeSummary Compensation Table for the amounts paid in March 2013.compensation programs.

Benefits.

Other Compensation Components

Benefits. Our NEOs participate in the benefitssame benefit and retirement plans provided toin which our U.S. salaried associates.associates participate. A group of approximately 5060 senior executives, including the NEOs, also receive supplemental life, supplemental disability and umbrella liability insurance benefits. Our NEOs are eligible to participate in AAM’s qualified and nonqualified defined benefit pension plans and defined contribution plans. They are also eligible to participate in a nonqualified deferred compensation plan that permits deferrals of a portion of base salary and/or annual cash incentive compensation on a pretax basis. These plans are described in thePension Benefits andNonqualified Deferred Compensation sections below.

Perquisites. AAM provides a limited number of perquisites forto senior executives, including our NEOs. AAM has never owned a corporate aircraft and does not provide leased aircraft for personal use. AAM does not pay for country club memberships.

Senior executives are eligible for the use of a Company-provided vehicle with AAM content. The Company also provides a vehicle forMr. Dauch has the use by the spouses of the Executive Chairman and the President & CEO. From time to time,two Company-provided vehicles. Occasionally, the Company invites spouses of AAM senior executives to attend Company business events. For attendance that requires a spouse to travel, the Companyevents and pays for the spouse’s travel and other related non-business expenses andexpenses. The Company reimburses the executive for taxes attributable to the income associated with this benefit. We do not provide tax gross ups for executives except for those available for all salaried associates generally. Perquisites are further described in the footnotes to theSummary Compensation Table.

Compensation

Employment Agreements
In February 2015, Mr. Dauch's employment agreement was amended to change the severance payments and benefits in the event his employment is terminated on or within two years following a change in control (CIC). The amendment reflects an increase in his severance payment from two times to three times his annual base salary and bonus. The CIC benefits for Mr. Dauch were determined in consideration of market data and the level of CIC benefits provided to other executive officers under the AAM Executive Chairman

Effective September 1, 2012, the Board appointed the co-founder, Mr. R. E. Dauch, Executive Chairman of the Board. Officer Change in Control Plan (CIC Plan) discussed below.

The Company entered into an employment agreement with Mr. R.E. Dauch onSimonte effective August 27, 20121, 2015 in connection with this appointment, which was concurrent with the appointment of Mr. D. C. Dauch as President & CEO. The key responsibilities assigned to Mr. R.E. Dauch are described above inCorporate Governance, Board Leadership Structure.

Mr. R.E. Dauch’s total compensation package is set forth in his employment agreement. Mr. R.E. Dauch’s compensation was structured in order to induce him to defer retirement from AAM and assume the leadership responsibilities as Executive Chairman. The Board approved the Executive Chairman’s compensation package in consideration of Mr. R.E. Dauch’s extensive knowledge and expertise in the global automotive industry and the Board’s expectation that he will carry out these responsibilities in support of AAM’s goals and business strategy to build value for AAM stockholders and other key stakeholders.

Mr. R.E Dauch’s employment agreement continues through August 31, 2015, and renews automatically for two additional one-year periods unless either party gives notice of its election not to renew. The terms and conditions of his employment agreement are further described in theNarrative to Summary Compensation and Grants of Plan-Based Awards Table below. The components of Mr. R.E. Dauch’s compensation are described below.

Base Salary.    Mr. R.E. Dauch’s base salary as CEO was $2 million beginning October 1, 2011 through August 31, 2012. Effective September 1, 2012, Mr. R.E. Dauch’s base salary as Executive Chairman was set at $2 million, continuing through August 31, 2015. His base salary will be reduced to $1 million for any renewal period from September 1, 2015 through August 31, 2017. Base salary for 2012, 2011 and 2010 is shown in theSummary Compensation Table.

Annual Cash Bonus.    For calendar year 2012, Mr. R.E. Dauch was eligible for an annual cash bonus as determined under his prior employment agreement. Accordingly, the annual cash bonus for 2012 is based on the Compensation Committee’s assessment of Company performance as compared to that of our competitor peer group. He was eligible to receive an annual bonus payment of up to three times his annual salary, or $6 million, if AAM outperformed its competitor peer group. In determining Mr. R.E. Dauch’s annual bonus, the Compensation Committee may use discretion in considering other factors, which may differ from year to year.

The Compensation Committee approved Mr. R.E. Dauch’s annual bonus for 2012 in the amount of $4 million. In determining this award, the Compensation Committee considered AAM’s 2012 performance, including strong sales growth of 13.4% on year-over-year basis, new business awards resulting in a new business backlog of $1.25 billion for the years 2013-2015, achievement of market competitive labor cost structures and attainment of key quality performance objectives. The Committee also considered the successful completion of financing initiatives that provided additional liquidity to fund AAM’s sales growth, extended the debt maturity profile of AAM’s debt capital structure and allowed AAM to improve the funded status of our global pension plans. The Company’s 2012 performance was adversely impacted by special charges related to the closure of two U.S. plants, increased costs associated with global launch activity, lower capacity utilization and labor inefficiencies. Based on these and other factors, the Compensation Committee decided that the

amount of his award would be less than the maximum amount permitted under his employment agreement. This 2012 award reflects a $2 million decrease from his 2011 bonus. SeeNarrative to Summary Compensation Table and Grants of Plan-Based Awards Table below.

Long-Term Incentives.    Upon his appointment as Executive Chairman on September 1, 2012,President of the Company.

The terms of Mr. R.E. Dauch received a one-time equity award of RSUs with a grant date value of $6,247,000. The Compensation Committee considered the amount of this award to be appropriate as a long-term incentive based on his service as AAM’s CEO during 2012Dauch's and the Company’s desire to provide an inducement sufficient for Mr. R.E. Dauch to enter into theSimonte's employment agreement as Executive Chairman. Mr. R.E. Dauch is not eligible to receive any additional equity or other long-term incentive awards during the term of his employment agreement.

Under his prior employment agreement, Mr. R.E. Dauch was entitled to receive, each year, an award of 150,000 stock options and an equity award of equal value. Accordingly, on May 30, 2012, Mr. R.E. Dauch received 150,000 stock options and 68,227 RSUs under the 2012 Omnibus Incentive Plan. Mr. R.E. Dauch did not receive any long-term incentive awards for 2010 and 2011 as a result of, among other things, AAM not having an equity plan available for issuance of equity-based awards. These awardsagreements are shown in theGrants of Plan-Based Awardstable and are further described in theNarrative to the Summary Compensation Table and Grants of Plan-Based Awards Tablebelow.

Benefitsand Potential Payments Upon Termination or Change in Control.


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Change in Control Plan
In February 2015, upon the recommendation of the Committee, the Board approved the CIC Plan for executive officers. The CIC Plan provides eligible executive officers with severance payments and Perquisites.    Mr. R.E. Dauch participatesbenefits in the same benefit programsevent of termination of employment on or within two years following a CIC. Mr. Dauch and Mr. Simonte do not participate in the CIC Plan due to the severance payments and benefits provided under each of their employment agreements.
Severance payments and benefits under the CIC Plan include, among other things, a severance payment equal to two times annual base salary and annual bonus and continuation of medical benefits for other executive officers. In addition, under histwo years. CIC severance payments and benefits are subject to continued compliance following termination of employment agreement, AAM provides Mr. R.E. Dauchfor two years with the usenon-competition provision of twothe CIC Plan. CIC severance payments and benefits for all executive officers are subject to the execution and non-revocation of a general waiver and release of claims against the Company. Certain severance payments are also subject to the Company's clawback policy as described below.
The Board believes the CIC Plan enhances stockholder value by encouraging executive officers to consider CIC transactions that may be in the best interests of the Company vehicles and reimburses himour stockholders while keeping them neutral to potential job loss. The Board also believes that the CIC Plan is aligned with competitive market practices and will help to retain key talent. Severance benefits provided to our NEOs are further described under Potential Payments Upon Termination or Change in Control.
Executive Compensation Recoupment (Clawback) Policy
The clawback policy authorizes the Committee to determine whether to require recoupment of performance-based incentive compensation actually paid or awarded to any executive officer if certain conditions are met. For purposes of this policy, performance-based compensation includes all annual incentives for premiumsperiods beginning with the 2014 fiscal year and long-term incentives awarded after January 1, 2014, whether paid in cash or equity, to the extent the awards are determined based on the Company's financial performance.
The Committee may require recoupment if the executive officer engaged in fraud or intentional misconduct that caused or contributed to the need for a $5 million life insurance policy. The Company will also provide postretirement health care benefits upon expirationmaterial restatement of his employment agreement. Perquisites providedthe Company's financial statements filed with the SEC. If the Committee determines that any performance-based compensation paid or awarded to the Executive Chairmanexecutive officer would not have been awarded or would have been awarded at a lower amount had it been calculated based on such restated financial statements (adjusted compensation), the Committee may seek to recover for the benefit of the Company the excess of the awarded compensation over the adjusted compensation (excess compensation). In deciding whether to seek recovery of excess compensation from the executive officer, the Committee will consider the factors it deems relevant under the circumstances and whether the assertion of a claim is in 2012, 2011 and 2010 are reported in theSummary Compensation Table.

best interests of the Company.

Executive Officer Stock Ownership Requirements & Anti-Hedging Policy

Stock Ownership Requirements.

 A fundamental objective of our compensation program is for executive officers to own AAM stock in order to align their interests with those of our stockholders and to reinforce the importance of making sound long-term decisions. Since January 2009, the Company has been unable to issue equity-based compensation in support of the achievement of stock ownership requirements. Consequently, the Compensation Committee adopted provisionalThe Company's current stock ownership requirements based on a fixed number of shares at levels that recognized that executive officers would not receive equity-based compensation until our stockholders approved a new incentive plan under which equity awards could be made.

Upon stockholder approval of AAM’s 2012 Omnibus Incentive Plan, the Compensation Committee decided to increase the stock ownership requirements for executive officers in 2012 and change the measurement from a fixed number of shares to a multiple of base salary. These new stock ownership requirements were based on an analysis of prevalent external market practices provided by Meridian in 2012 at the direction of the Compensation Committee. Based on this analysis, the Compensation Committee increased the stock ownership requirement levelsare as follows:

Stock Ownership Requirements for Executive Officers

 
Multiple of
Base Salary

Chief Executive Officer

5

President; Executive Vice President

3

Senior Vice President; Group Vice President andPresident; Vice President

2


Executive officers have five years from April 2012 to meet these requirements or, for new executive officers, five years from the date of becoming an executive officer. Once the requirement is met, the executive officer must maintain the required ownership level.appointment. Shares owned directly, and any unvested RSUs (payable in stock) are considered in determiningand performance shares (at target) count toward the requirements;requirement while unexercised stock options are not considered. One hundred percent of the net shares of equity awards granted by the Companyincluded. These ownership levels must be held untilmaintained as long as the requirement has been met.

person is an executive officer of AAM.

The Compensation Committee annually reviews each executive officer’s stock ownership amounts as comparedlevel according to the established stock ownership requirements. All executive officers arethis policy. Each NEO has met or is on targettrack to meet these stockthe ownership requirements established for their respective positions.

his position.


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Anti-hedging Policy.    Alland Anti-pledging Policy
AAM prohibits employees and non-employee directors are prohibited from entering into transactions that may result in a financial benefit if our stock price declines, or any hedging transaction involving our stock, including but not limited to the use of financial derivatives, short sales or any similar transactions. Pledging of Company stock is also prohibited.

Severance Benefits and Restrictive Covenants

Other than the Executive Chairman and President & CEO, our NEOs are not entitled to severance benefits upon termination of employment for any reason. AAM does not provide any NEO with severance benefits solely as a result of a change in control. Our employment agreements with Mr. D.C. Dauch and Mr. R.E. Dauch provide for certain benefits upon termination of employment without cause or upon resignation for good reason. Severance benefits payable under these agreements are described underPotential Payments upon Termination or Change in Control below.

Each of the NEOs has agreed to non-competition and non-solicitation covenants for a period following termination of employment. For additional information, seePotential Payments upon Termination or Change in Control below.

Tax Gross Ups

The Company does not provide tax gross ups to an executive officer upon a change in control.

Tax Deductibility of Compensation

In general, the compensation awarded to the NEOs will be taxable to the executive and will give rise to a corresponding corporate deduction at the time the compensation is paid. Section 162(m) of the Internal Revenue Code precludes a public corporation from taking a tax deduction for annual compensation in excess of $1 million paid to the CEO or to any of the other NEOs other than the CFO. One exception applies to performance-based compensation paid pursuant to stockholder-approved employee benefit plans. Performance basedPerformance-based compensation is compensation that is paid only if the individual’s performance meets pre-established objective performance goals based on performance criteria approved by our stockholders.

Although deductibility of compensation is preferred, tax deductibility is not the primary objective of the Company’sour compensation programs. The Compensation Committee may decide to pay compensation or grant awards that are consistent withserve the objectives of our executive compensation program thateven though such compensation or awards may not be deductible by the Company for tax purposes.

Company.

The annual incentives and long-term incentive performance unitshare awards granted in 20122015 to theour NEOs (other than the Executive Chairman) are intended to comply with the performance-based compensation exemption under Section 162(m). RSUs granted to NEOs in 2012,2015, although not deductible, were considered to be the appropriate vehicle for a portion of the long-term incentive component of our executive compensation program. The 2012 annual bonus for the Executive Chairman was determined in accordance with his employment agreement and is not deductible. Stock options granted to Mr. R.E. Dauch in 2012 are intended to satisfy the requirements for deductibility under Section 162(m).


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Table of Contents

REPORT OF THE COMPENSATION COMMITTEE

The Compensation Committee has

We have reviewed and discussed with management the Compensation Discussion and Analysis required by Item 402(b) of Regulation S-K, and basedwith management. Based on such review and discussions,discussion, we recommended to the Board of Directors that suchthe Compensation Discussion and Analysis be included in this proxy statement.

Compensation Committee of the Board of Directors

Forest J. Farmer, Chairman

Elizabeth A. Chappell,

Chair

Steven B. Hantler

Larry K. Switzer

Thomas K. Walker

William L. Kozyra
James A. McCaslin
Samuel Valenti III


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SUMMARY COMPENSATION TABLE

The following table summarizes the compensation of our named executive officers (NEOs) for the fiscal years ended December 31, 2012,2015, December 31, 20112014 and December 31, 2010.

Name and

Principal Position

 Year  Salary
($)		  Bonus(2)
($)		  Stock
Awards(3)
($)		  Options
Awards(3)
($)		  Non-Equity
Incentive
Plan
Compen-
sation(4)
($)		  Change in
Pension Value
And
Nonqualified
Deferred
Compensation
Earnings(5)
($)		  All Other
Compen-
sation(6)
($)		  Total
($)		 
          

David C. Dauch(1)

                  

President & Chief Executive Officer

  2012    873,333    21,500    979,013    —    1,728,100    565,534    67,695    4,235,175  
  2011    650,004    111,150    —    —    7,169,180    397,228    28,778    8,356,340  
  2010    575,004    —    —    —    731,250    97,540    27,006    1,430,800  
          

Michael K. Simonte

                  

Executive Vice President & Chief Financial Officer

  2012    527,900    4,617    316,743    —    935,383    294,245    48,942    2,127,830  
  2011    515,004    37,080    —    —    4,255,095    251,101    49,604    5,107,884  
  2010    500,004    —    —    —    500,000    97,430    51,294    1,148,728  
          

Richard E. Dauch(1)

Co-Founder & Executive Chairman

  2012    2,000,000    4,000,000    6,874,007    627,000    —    4,201,202    141,916    17,844,125  
  2011    2,526,728    6,000,000    —    —    —    2,802,700    149,441    11,478,869  
  2010    2,702,304    —    —    —    —    2,692,143    158,981    5,553,428  
          

John J. Bellanti

                  

Executive Vice President, Worldwide Operations

  2012    485,700    —    291,424    —    802,400    188,187    42,429    1,810,140  
  2011    473,796    —    —    —    2,166,972    446,401    33,823    3,120,992  
  2010    459,996    —    —    —    460,000    357,673    30,312    1,307,981  

Norman Willemse

Vice President, Metal Formed Product

Business Unit

  
 		2012
2011		  
  		  
 		310,600
303,000		  
  		  

 

—

—

  

  

  

 

124,249

—

  

  

  

 

—

—

  

  

  
 		376,808
603,180		  
  		  
 		100,562
113,444		  
  		  
 		48,162
41,412		  
  		  
 		960,381
1,061,036		  
  

2013 to the extent they served as our NEOs in such years.
Name and
Principal Position
Year
Salary
($)
Bonus
($)
Stock
Awards(2)
($)
Options
Awards
($)
Non-Equity
Incentive
Plan
Compen-
sation(3)
($)
Change in
Pension Value
And
Nonqualified
Deferred
Compensation
Earnings(4)
($)
All Other
Compen-
sation(5)
($)
Total
($)
David C. Dauch(1)Chairman & Chief Executive Officer
20151,150,000
—
5,348,595
—
5,447,875
1,201,615
67,131
13,215,216
20141,100,000
—
4,454,330
—
2,638,120
1,081,679
75,189
9,349,318
20131,033,333
—
1,750,002
—
3,185,250
245,423
116,389
6,330,397
Christopher J. May
Vice President & Chief Financial Officer		2015292,505
—
148,344
—
297,646
107,445
44,199
890,139
         
         
Michael K. Simonte
President		2015603,192
—
1,431,050
—
1,773,967
347,876
52,561
4,208,646
2014560,100
—
1,296,049
—
961,046
375,597
52,666
3,245,458
2013543,800
—
543,810
—
1,429,085
27,943
50,817
2,595,455
Alberto L. Satine President Driveline2015482,875
—
689,895
—
899,225
224,587
52,473
2,349,055
2014450,000
—
624,777
—
498,640
237,798
41,032
1,852,247
2013360,000
—
216,006
—
565,800
—
41,399
1,183,205
Norman Willemse
President Metal Formed Products		2015426,667
—
508,544
—
743,575
169,498
32,065
1,880,349
2014375,767
—
445,473
—
445,467
135,322
48,459
1,450,488
2013320,000
—
160,006
—
579,120
12,546
50,348
1,122,020
Terry J. Woychowski (6)                        Former Senior Vice President, Advanced Engineering
2015437,932
—
669,787
—
440,100
—
492,901
2,040,720
2014463,500
—
624,777
—
305,100
57,407
50,819
1,501,603
         

(1)Compensation of Mr. D.C. Dauch and Mr. R.E. Dauch receive compensationis based solely on their rolesemployment as an executive officers. They receiveofficer. He received no compensation for serving as directors.a director.

(2)Reflects discretionary adjustments to the 2012 annual incentive payments for Mr. D.C. Dauch and Mr. Simonte as described above in theCompensation Discussion and Analysis. For Mr. R.E. Dauch, reflects a 2012 bonus award under his employment agreement as described in theNarrative to Summary Compensation Table and Grants of Plan-Based Award Table.

(3)Reflects the full grant date fair value of equityrestricted stock units and performance share awards made during fiscal year 20122015 calculated in accordance with FASB ASC 718 (without any reduction for risk of forfeiture) as determined based on applying the assumptions used in our financial statements. The grant date fair value of stock awards is calculated using the closing market price of AAM common stock on the date of grant. The grant date fair value of option awards was calculated using the Black-Scholes option pricing model. See Note 96 to the audited consolidated financial statements in our Annual Reportannual report on Form 10-K for the year ended December 31, 20122015 regarding assumptions underlying the valuation of equity awards. Assuming the maximum performance levels are achieved for the performance share awards granted on March 2, 2015, the maximum value of performance share awards would be $5,692,562 for Mr. Dauch, $1,523,080 for Mr. Simonte, $734,270 for Mr. Satine, $541,259 for Mr. Willemse and $712,858 for Mr. Woychowski based on grant date fair value. These amounts may not reflect the actual value realized upon vesting or settlement, if any. Mr. May did not receive a grant of performance share awards during 2015.

(3)Reflects amounts earned under the AAM Incentive Compensation Plan for Executive Officers for 2015 and cash-based performance unit awards granted under the 2012 Omnibus Incentive Plan for the 3-year performance period ending December 31, 2015. For Mr. Dauch, also reflects the payment of $338,500 for a cash-based performanceaward for the performance period July 1, 2012 through July 30, 2015. The 2015 amounts earned are as follows:
Name
AAM Incentive
Compensation Plan
 2012 Omnibus Incentive Plan Total
David C. Dauch$2,256,875
 $3,191,000
 $5,447,875
Christopher J. May$297,646
 $—
 $297,646
Michael K. Simonte$887,573
 $886,394
 $1,773,967
Alberto L. Satine$547,145
 $352,080
 $899,225
Norman Willemse$482,775
 $260,800
 $743,575
Terry Woychowski$—
 $440,100
 $440,100

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(4)Reflects amounts earned under the AAM Incentive Compensation Plan for Executive Officers and the 2009 AAM LTIP with respect to the three-year performance period ending December 31, 2012. The 2012 amounts are as follows:

   AAM Incentive
Compensation Plan		   AAM LTIP   Total 

David C. Dauch

  $518,500    $1,209,600    $1,728,100  

Michael K. Simonte

  $215,383    $720,000    $935,383  

John J. Bellanti

  $140,000    $662,400    $802,400  

Norman Willemse

  $95,000    $281,808    $376,808  

(5)
Reflects the annualized increase in pension value under the Salaried Retirement Program, the Albion Pension Plan and the Supplemental Executive Retirement Program (SERP). For Mr. Woychowski, reflects a net negative change in pension value for 2015 of $82,596 resulting from the forfeiture of his SERP benefit upon termination of employment. See Pension Benefits Table below. There are no above-market or preferential earnings on compensation deferred under our Executive Deferred Compensation Plan. Effective August 1, 2012,

(5) The components of All Other Compensation for 2015 are as follows:
Name
Employer
401(k) Match
Contributions(a)
($)
Retirement
Contributions(b)
($)
Executive
Life
Insurance
Premiums(c)
($)
Company-Provided
Vehicles(d)
($)
Tax Gross Ups for Spousal Travel(e)
($)
Other(f)
($)
Total
($)
David C. Dauch13,086
13,250
10,859
22,214
2,033
5,689
67,131
Christopher J. May12,855
12,855
1,096
16,978
—
415
44,199
Michael K. Simonte13,250
13,250
5,047
20,414
—
600
52,561
Alberto L. Satine12,975
13,250
6,362
18,376
—
1,510
52,473
Norman Willemse12,865
13,250
4,943
—
407
600
32,065
Terry Woychowski9,000
7,950
5,620
20,303
—
450,028
492,901
(a)Includes employer matching contributions under AAM’s 401(k) plan.
(b)Includes employer retirement contributions under AAM’s 401(k) plan.
(c)Includes executive life insurance premiums paid by the Company.
(d)Includes personal use of Company-provided vehicles. The aggregate incremental cost of Company-provided vehicles is based on total vehicle cost if business use of the SERP was amended to include an actuarial increase provision for participants who continue to work after age 65.vehicle is less than 50%. For Mr. R.E. Dauch, the amount shown for 2012 includes the impactcost of personal use of a second Company-provided vehicle. For Mr. May, reflects a vehicle allowance of $5,000 through May 2015 and the personal use of a Company-provided vehicle for the remainder of the SERP amendment of approximately $2.8 million. The SERP amendment is further described in the narrative to thePension Benefits Table.year.

(6)The components of All Other Compensation for 2012 are as follows:

Name 

Employer
401(k) Match
Contributions(a)

$

  

Retirement
Contributions(b)

$

  

Executive
Life
Insurance
Premiums(c)

$

  

Tax
Gross
Ups for
Spousal
Travel(d)

$

  

Other(e)

$

  

Total

$

 

David C. Dauch

  11,938    12,500    4,432    14,303    24,522    67,695  

Michael K. Simonte

  12,250    12,500    3,367    —    20,825    48,942  

Richard E. Dauch

  9,375    9,375    100,808    —    22,358    141,916  

John J. Bellanti

  8,500    12,500    6,436    —    14,993    42,429  

Norman Willemse

  12,146    13,647    2,784    193    19,392    48,162  

(a)Includes employer matching contributions under AAM’s 401(k) plan.

(b)Includes employer retirement contributions under AAM’s 401(k) plan.

(c)Includes executive life insurance premiums.

(d)(e)Includes amounts reimbursed for taxes attributable to the income associated with the cost of spousal travel for participation in Company business meetings and events.

(e)
(f)Includes personal use of Company-provided vehicles for Mr. D.C. Dauch, Mr. Simonte, Mr. R.E. Dauch and Mr. Bellanti. The aggregate incremental cost of Company-provided vehicles is based on total vehicle cost if business use of the vehicle is less than 30%. For Mr. D.C. Dauch, includes the cost of travel for spousal participation in Company business meetings or events, personal umbrella liability insurance premiums, cost of an executive physical and events. For Mr. D.C. Dauch and Mr. R.E. Dauch, also includes meals provided during business hours. For Mr. R.E. Dauch, includes airline club access fees. ForMay, Mr. Simonte and Mr. Willemse, also includes employer matching contributions under the Executive Deferred Compensation Plan, the cost of airfare for personal travel underumbrella liability insurance premiums. For Mr. Satine, includes the cost of an international relocation arrangementexecutive physical and the cost of travel for spousal participation in Company business meetings and events. For each NEO, reflects the cost of executive physicals and personal umbrella liability insurance premiums. For Mr. Woychowski, includes a severance payment of $448,168 in connection with the termination of his employment effective December 9, 2015, the cost of personal umbrella insurance premiums and the cost of an executive physical.

(6) Refer to the Narrative to Summary Compensation Table and Grants of Plan-Based Awards Table and the Potential Payments Upon Termination or Change in Control section below for a description of the terms of the separation agreement with Mr. Woychowski effective December 9, 2015.

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GRANTS OF PLAN-BASED AWARDS

Annual and long-term incentive awards granted in 20122015 to the NEOs are shown in the following table. The annual and long-term incentive compensation programs are described in the Compensation Discussion and Analysis and following the tableNarrative to Summary Compensation Table and Grants of Plan-Based Awards Table below.

           Estimated Future Payouts under
Non Equity Incentive Plan Awards(1)		  All Other
Stock
Awards:
Number
of Shares
of Stock
or Units(2)
#		  All Other
Option
Awards:
Number of
Securities
Underlying
Options(3)
#		  Exercise
or Base
Price of
Option
Awards
$/Sh(4)		  Grant Date
Fair
Value of
Stock and
Option
Awards(5)
$		 
Name Grant Date  Approval
Date		  Number
of
Units #		  Threshold
$		  Target
$		  Maximum
$(1)		     

David C. Dauch

                                        

Annual Incentive

  —    —    —    406,667    1,016,667    —    —    —    —    —  

Long-Term Incentive

  5/30/2012    4/26/2012    729,000    182,250    729,000    1,458,000    79,326    —    —    729,006  

Long-Term Incentive

  9/1/2012    8/27/2012    250,000    62,500    250,000    500,000    22,382    —    —    250,007  

Michael K. Simonte

                                        

Annual Incentive

  —    —    —    168,928    422,320    —    —    —    —    —  

Long-Term Incentive

  5/30/2012    4/26/2012    316,740    79,185    316,740    633,480    34,466    —    —    316,743  

Richard E. Dauch(6)

                                        

Long-Term Incentive

  5/30/2012    4/26/2012    —    —    —    —    68,227    150,000    9.19    1,254,006  

Long-Term Incentive

  9/1/2012    8/27/2012    —    —    —    —    559,266    —    —    6,247,001  

John J. Bellanti

                                        

Annual Incentive

  —    —    —    155,424    388,560    —    —    —    —    —  

Long-Term Incentive

  5/30/2012    4/26/2012    291,420    72,855    291,420    582,840    31,711    —    —    291,424  

Norman Willemse

                                        

Annual Incentive

  —    —    —    74,544    186,360   —    —    —    —    —  

Long-Term Incentive

  5/30/2012    4/26/2012    124,240    31,060    124,240    248,480    13,520    —    —    124,249  

NameGrant Date
Approval
Date
Estimated Future Payouts under
Non Equity Incentive Plan Awards(1)
Estimated Future Payouts under
Equity Incentive Plan Awards(2)
All Other
Stock Awards:
Number of
Shares of Stock
or Units(3)
(#)
Grant Date
Fair
Value of
Stock and
Option
Awards(4)
($)
Threshold
($)
Target
($)
Maximum
($)
Threshold
(#)
Target
(#)
Maximum
(#)
David C. Dauch          
Annual Incentive1/1/201510/28/2014359,375
1,437,500
2,875,000
—
—
—
—
—
Performance Shares (TSR)3/2/20152/4/2015—
—
—
28,181
56,362
112,724
—
1,759,002
Performance Shares (EBITDA)3/2/20152/4/2015—
—
—
14,091
56,362
112,724
—
2,123,325
Restricted Stock Units3/2/20152/4/2015—
—
—
—
—
—
58,070
1,466,268
Christopher J. May          
Annual Incentive1/1/201510/28/201447,396
189,583
379,166
—
—
—
—
—
Restricted Stock Units3/2/20152/4/2015—
—
—
—
—
—
5,875
148,344
Michael K. Simonte          
Annual Incentive1/1/201510/28/2014141,333
565,333
1,130,666
—
—
—
—
—
Performance Shares (TSR)3/2/20152/4/2015—
—
—
7,540
15,080
30,160
—
470,632
Performance Shares (EBITDA)3/2/20152/4/2015—
—
—
3,770
15,080
30,160
—
568,109
Restricted Stock Units3/2/20152/4/2015—
—
—
—
—
—
15,537
392,309
Alberto L. Satine          
Annual Incentive1/1/201510/28/201487,125
348,500
697,000
—
—
—
—
—
Performance Shares (TSR)3/2/20152/4/2015—
—
—
3,635
7,270
14,540
—
226,889
Performance Shares (EBITDA)3/2/20152/4/2015—
—
—
1,817
7,270
14,540
—
273,883
Restricted Stock Units3/2/20152/4/2015—
—
—
—
—
—
7,490
189,123
Norman Willemse          
Annual Incentive1/1/201510/28/201476,875
307,500
615,000
—
—
—
—
—
Performance Shares (TSR)3/2/20152/4/2015—
—
—
2,680
5,359
10,718
—
167,249
Performance Shares (EBITDA)3/2/20152/4/2015—
—
—
1,340
5,359
10,718
—
201,890
Restricted Stock Units3/2/20152/4/2015—
—
—
—
—
—
5,521
139,405
Terry J. Woychowski          
Annual Incentive1/1/201510/28/201467,500
270,000
540,000
—
—
—
—
—
Performance Shares (TSR)3/2/20152/4/2015—
—
—
3,529
7,058
14,116
—
220,273
Performance Shares (EBITDA)3/2/20152/4/2015—
—
—
1,765
7,058
14,116
—
265,896
Restricted Stock Units3/2/20152/4/2015—
—
—
—
—
—
7,272
183,618

(1)Reflects annual incentive awards granted under the AAM Incentive Compensation Plan for Executive Officers. Net operating cash flow and net income as a percentage of sales (NIPS) were selected as
(2)Reflects performance metrics for 2012 annual incentive awards. The maximum payout for net operating cash flow is 125%. There is no established maximum for NIPS. Also includes the long-term incentive performance unitshare awards granted under the 2012 Omnibus Incentive Plan. The performance unitsawards are payable in cashcommon stock based on the Company’sCompany's EBITDA performance. See further discussion of these incentive awards undermargin and relative TSR performance, each weighted 50%, over theNarrative to Summary Compensation Table and Grants of Plan-Based Award Table. 3-year performance period January 1, 2015 through December 31, 2017.

(2)
(3)Reflects RSU awardsRSUs granted under the 2012 Omnibus Incentive Plan. The awards are payable in common stock, contingent upon continued employment through the 3-year vesting period. See further discussionNo options were granted in theNarrative to the Summary Compensation Table and the Grants of Plan-Based Awards Table.2015.

(3)Reflects stock option award granted to Mr. R.E. Dauch under his prior employment agreement. See further discussion in theNarrative to Summary Compensation Table and Grants of Plan-Based Award Tableand in the Compensation of Executive Chairman section of theCompensation Discussion and Analysis.

(4)Equal to the closing market price of AAM common stock on the grant date, May 30, 2012.

(5)

Reflects the full grant date fair value of equityperformance share awards and RSUs made during fiscal year 20122015 calculated in accordance with FASB ASC 718 (without any reduction for risk of forfeiture) as determined based

on applying the assumptions used in our financial statements. The grant date fair value of stock awards is calculated using the closing market price of AAM common stock on the date of grant. The grant date fair value of option awards was calculated using the Black-Scholes option pricing model. See Note 96 to the audited consolidated financial statements in our Annual Report on Form 10-K for the year ended December 31, 2012 regarding assumptions underlying the valuation of equity awards.annual

(6)Mr. R.E. Dauch received a 2012 bonus payment of $4 million under his prior employment agreement. See further discussion in theNarrative to Summary Compensation Table and Grants of Plan-Based Awards Table and in theCompensation of Executive Chairman section of theCompensation Discussion and Analysis.


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report on Form 10-K for the year ended December 31, 2015 regarding assumptions underlying the valuation of equity awards.

Narrative to Summary Compensation Table and Grants of Plan-Based Awards Table

President &

Employment Agreements
Our employment agreements with Mr. Dauch as CEO Employment Agreement

Effective September 1, 2012,and Mr. D.C. Dauch’s employment agreementSimonte as President & CEO providesprovide for the following compensation and benefits:

benefits as of December 31, 2015:

Term

CEO Employment Agreement

Initial Term: September 1, 2012 through August 31, 2015

Additional one year extensions unless either party provides 60 days’ written notice of intent not to renew

President Employment Agreement

Base Salary

$1,150,000 effective January 1, million effective September 1, 2012,2015, subject to annual review and increase by the Compensation Committee in its sole discretionCommittee.$640,000 effective August 1, 2015, subject to annual review and increase by the Compensation Committee. (Actual amount paid for 2015, $603,192)

Annual Incentive

Participation in the AAM Annual Incentive Planannual incentive plan for Executive Officers

executive officers. Target opportunity of 125% of base salary, subject to the annual review and increase by the Compensation Committee.

Participation in the annual incentive plan for executive officers. Initial target opportunity as of SeptemberAugust 1, 20122015 is 125%100% of base salary,

subject to annual review and increase by the Compensation Committee.

Long-Term Incentive

Participation in the long-term incentive plans applicablefor executive officers. Target opportunity of 375% for 2015, subject to annual review and increase by the Compensation Committee.

Participation in the long-term incentive plans for executive officers

officers. Initial target opportunity as of September 1, 2012for 2016 is 240%220% of base salary,

One-time award on September 1, 2012 of RSUs with a grant date value of $250,000 subject to annual review and performance units with a target value of $250,000

increase by the Compensation Committee.

Other Benefits

Participation in plans applicable to executive officers

officers. Retiree medical, dental and vision coverage equivalent to the benefit levels offered in the Company’sCompany's group health care plans for active salaried associates as of September 1, 2012

Executive Chairman Employment Agreement

Effective September 1, 2012, Mr. R.E. Dauch’s employment agreement as Executive Chairman provides for the following compensation and benefits:

2012.Participation in plans applicable to executive officers.

Term

Initial Term:term: September 1, 2012 through August 31, 2015

Two additional2015. Additional one-year extensions unless either party provides 60 days’days' written notice of intent not to renew

Base Salary

renew.		$2 millionInitial term: August 1, 2015 through AugustJuly 31, 2015; $1 million thereafter if agreement is extended2018. Additional one-year extensions unless either party provides 60 days' written notice of intent not to renew.

2012 Annual Incentive

Annual cash bonus in an amount determined by the Compensation Committee based on our financial performance relative to AAM’s competitor peer group:

•     equal to 3 times annual base salary if the Company outperforms our competitor peer group;

•     up to the amount of Mr. R.E. Dauch’s base salary if the Company does not outperform the Company’s competitor peer group

Subject to adjustment based on other factors as determined by the Compensation Committee in its sole discretion

Long-Term Incentive

One-time grant of RSUs with a grant date value of $6,247,000 on September 1, 2012

Other Benefits

Participation in plans applicable to executive officers

Reimbursement of premiums under a $5 million life insurance policy purchased by Mr. R.E. Dauch;

Use and maintenance of two Company-provided automobiles

Under the employment agreements with Mr. D.C. Dauch and Mr. R.E. Dauch,Simonte are also entitled to certain payments and benefits will be provided in the event of termination of employment under differentthe scenarios as described below inPotential Payments Upon Termination or Change in Control.


Agreement with Former Executive

The Company entered into a separation agreement and release with Mr. Woychowski in connection with his separation from employment with AAM as of December 9, 2015. Pursuant to the separation agreement, Mr. Woychowski received a lump sum severance payment of $448,168 (less withholding taxes) and executed a full and final release of claims against AAM. Payments made to Mr. Woychowski are shown in the Potential Payments Upon Termination or Change in Control section below.

Payment or settlement of outstanding LTI awards were made to Mr. Woychowski under the terms of applicable award agreements. Mr. Woychowski received full payment of the 2013 performance unit award of $440,100 for the performance period January 1, 2013 through December 31, 2015. He also received pro-rata payouts of two-thirds of his 2014 performance share awards and one-third of his 2015 performance share awards, less shares withheld for taxes. The remaining balance of each of these performance awards was forfeited. Outstanding RSU awards for 2013, 2014 and 2015 were forfeited. Pursuant to the AAM Incentive Compensation Plan for Executive Officers, Mr. Woychowski was not eligible to receive payment of an annual incentive award for 2015.
Annual Incentive Awards
In 2015, annual incentive awards were granted under the AAM Incentive Compensation Plan for Executive Officers. Net operating cash flow and NIPS were selected as performance metrics for these awards. The maximum payout for both performance metrics is 200%. See Annual Incentive Compensation in the CD&A.
Long-Term Incentive Awards

In 2012,2015, the Company granted long-term incentive awards to NEOs in the form of RSUs cash-basedand performance units and, for Mr. R.E. Dauch, stock options, under the 2012 Omnibus Incentive Plan.share awards. The terms of these awards as well as the outstanding cash-based performance awards granted under the 2009 AAM LTIP, are described below.

in Long-Term Incentive Compensation in the CD&A.


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2015 Awards Granted Under the 2012 Omnibus Incentive Plan

Restricted Stock Units (RSUs). The RSUs granted on March 2, 2015 to NEOs under age 57 at the date of grant vest in three years, while RSUs granted to NEOs age 57 and over vest ratably in three approximately equal annual installments. Upon vesting, theyears. All RSUs are payable in common stock. Vesting is accelerated upon termination of employment due to death or disability or upon a change in control.
Performance Share Awards. The award is forfeited if employment is terminated for any other reason prior to vesting.

Performance Unit Awards (PUs).    The PUsperformance share awards granted to the NEOs (other than the Executive Chairman) on May 30, 2012March 2, 2015 are based upon the attainment of certain EBITDA margin performance targets and relative TSR over a three-year performance period beginning January 1, 2015 through December 31, 2017. The performance share awards represented 66% of the total LTI award opportunity for executive officers. One-half of the 2015 performance share payouts, or 33% of the total LTI award, earned will be measured by EBITDA margin performance and one-half, or 33% of the total LTI award, will be measured by relative TSR performance over a 33-monththree-year period. TSR performance period beginning April 1, 2012 through December 31, 2014. PUs have an initial notional value equal to one dollar andshare payouts will be settled in cash. A pro rata portion ofcapped if the awardCompany's TSR is payable upon death, disability, retirement, termination without cause or upon a change in control.

The following table illustratesnegative for the threshold, target and maximum EBITDAthree-year period. All performance levels for determining awards under PUs.

EBITDA Performance Measure

Performance Level

  33-Month Cumulative
EBITDA		  Percent of
Target Award
Opportunity Earned		 

Threshold

   10%  25%

Target

   12%  100%

Maximum

   15%  200%

Stock Options.    The nonqualified stock options granted to Mr. R.E. Dauch on May 30, 2012 vest in three approximately equal installments on the first, second and third anniversaries of the grant date. Vesting is accelerated upon termination of employment due to death or disability or upon a change in control. The award is forfeited if employment is terminated for any other reason prior to vesting. Vested options expire ten years after the grant date and may be exercised any time before the earliest of: (1) the expiration of the grant, (2) five years following termination of employment due to death, disability or retirement, (3) 90 days following termination of employment without cause, or the participant’s resignation and (4) termination of employment for cause.

President & CEO Long-Term Incentive Award — September 1, 2012.    Upon his appointment as President & CEO on September 1, 2012, Mr. D.C. Dauch received a one-time long-term incentive award in the form of RSUs and performance units. Pursuant to his employment agreement, the RSU award had a grant date value of $250,000 and the performance unit award had a target value of $250,000. The RSU award is payable in common stock on the third anniversary of the grant date contingent upon continued employment with the Company. The performance unit award is payable in cash based on the Company’s EBITDA performance during the July 1, 2012 through June 30, 2015 performance period. The threshold, target and maximum EBITDA performance levels for determining the performance award payoutshares are shown in theEBITDA Performance Measure table above.

Executive Chairman Long-Term Incentive Award — September 1, 2012.    Upon his appointment to Executive Chairman on September 1, 2012, Mr. R.E. Dauch received a one-time long-term incentive award in the form of RSUs payable in common stock. Pursuant to his employment agreement, the award had a grant date value of $6,247,000 and vests ratably in three approximately equal annual installments contingent upon continued employment with the Company.

Awards granted under the AAM 2009 Long-Term Incentive Plan

Cash-Based Performance Awards.    Prior to adoption of the 2012 Omnibus Incentive Plan, the Company’s long-term incentive program consisted of cash-based performance awards made under the 2009 AAM LTIP. The cash payouts are determined based on EBITDA and relative total shareholder return (TSR) performance levels as shown below over a three-year performance period. The 2010 award payouts to the NEOs (other than the Executive Chairman) were paid in March 2013 as shown in theSummary Compensation Table above. The 2011 awards under the 2009 AAM LTIP remain outstanding. In calculating these awards, the Compensation Committee has discretion to exclude certain special items from EBITDA, such as special charges or gains, non-recurring operating costs, extraordinary gains or losses, the impact of changes in accounting principles, or other unusual items.

The following tables illustrate the threshold, target and maximum performance levels for determining 2010 and 20112015 award payouts for each performance measure.

   EBITDA Performance Measure  TSR Performance Measure 

Performance Level

  3-Year Cumulative
EBITDA		  Percent of
Target Award
Opportunity
Earned		  Company’s TSR
Percentile
Rank		  Percent of
Target Award
Opportunity
Earned		 

Threshold

   8%   25%   35th  50% 

Target

   12%   100%   50th  100% 

Maximum

   15%   200%   75th  200% 

 EBITDA Margin Performance Measure Relative TSR Performance Measure
Performance Level
3-Year
Cumulative
EBITDA Margin
 
Percent of
Target Award
Opportunity
Earned
 
Company TSR
Percentile
Rank
 
Percent of
Target Award
Opportunity
Earned
Threshold10% 25% 
35th
 50%
Target12% 100% 
50th
 100%
Maximum15% 200% 
75th
 200%
2013 Performance Unit Awards
Payouts of the 2013 cash-based performance unit awards were determined based on EBITDA margin for the performance period beginning January 1, 2013 through December 31, 2015. The Company's cumulative EBITDA margin for the performance period was 13.9%, after adjustments approved by the Committee for certain special charges, including debt refinancing and the payout of certain terminated vested participants under our defined benefit U.S. pension plans. The adjusted EBITDA margin resulted in a payment at 163% of target.
2012 Performance Unit Award
The payout of the 2012 cash-based performance unit award to Mr. Dauch was determined based on EBITDA margin for the performance period beginning July 1, 2012 through June 30, 2015. The Company's cumulative EBITDA margin for the performance period was 13.1% after adjustments approved by the Committee for certain special charges, including debt refinancing costs and the payout of certain terminated vested participants under our defined benefit U.S. pension plans. The adjusted EBITDA margin resulted in a payment at 135.4% of target.


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OUTSTANDING EQUITY AWARDS AT DECEMBER 31, 2012

Name  Number of
Securities
Underlying
Unexercised
Options
Exercisable
(#)		   Number of
Securities
Underlying
Unexercised
Options
Unexercisable(1)
(#)		   Option
Exercise
Price
($)		   Option
Expiration
Date		   Number of
Shares
or Units
of  Stock
That
Have
Not
Vested
(#)		  Market
Value of
Shares
or Units
of Stock
That
Have
Not
Vested(2)
($)		 

David C. Dauch

   28,000        23.73     1/22/2013     79,326(3)  888,451  
    28,000        38.70     2/2/2014     22,382(4)  250,678  
    12,000        26.65     3/15/2015       
    15,000        15.58     3/15/2016       
    13,000        26.02     3/14/2017       

Michael K. Simonte

   10,000          23.73     1/22/2013     34,466(3)  386,019  
    8,500        38.70     2/2/2014       
    9,000        26.65     3/15/2015       
    10,000        15.58     3/15/2016       
    10,000        26.02     3/14/2017       
    12,500        10.08     6/25/2018       

Richard E. Dauch

   300,000          23.73     1/22/2013     68,227(3)  764,142  
    300,000        38.70     2/2/2014     559,266(4)  6,263,779  
    150,000        26.65     3/15/2015       
    150,000        15.58     3/15/2016       
    150,000        26.02     3/14/2017       
    —     150,000     9.19     5/30/2022       

John J. Bellanti

   13,000          23.73     1/22/2013     31,711(3)  355,163  
    16,000        38.70     2/2/2014       
    9,000        26.65     3/15/2015       
    6,700        15.58     3/15/2016       
    10,000        26.02     3/14/2017       
    11,000        10.08     6/25/2018       

Norman Willemse

   8,000          23.73     1/22/2013     13,520(3)  151,424  
    7,500        38.70     2/2/2014       
    9,700          10.08     6/25/2018           

2015
 Option AwardsStock Awards
Name
Number of
Securities
Underlying
Unexercised
Options
Exercisable(1)
(#)
Option
Exercise
Price
($)
Option
Expiration
Date
Number of
Shares
or Units
of  Stock
That
Have
Not
Vested
(#)
Market
Value of
Shares
or Units
of Stock
That
Have
Not
Vested(2)
($)
Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested
(#)
Equity Incentive Plan Awards: Market of Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested
($)(8)
David C. Dauch15,000
15.58
3/15/2016
137,687(3)
2,607,792
  
 13,000
26.02
3/14/2017
66,447(4)
1,258,506
  
 




58,070(5)
1,099,846
  
     
64,493(6)
1,221,497
      
128,986(6)
2,442,995
      
28,181(7)
533,748
      
112,724(7)
2,134,993
Christopher J. May   
9,678(3)
183,301
  
    
7,310(4)
138,451
  
    
5,875(8)
111,273
  
Michael K. Simonte10,000
26.02
3/14/2017
42,786(3)
810,367
  
 




19,334(4)
366,186
  
 




15,537(5)
294,271
  
      
18,765(6)
355,409
      
37,530(6)
710,818
      
7,540(7)
142,808
 




  
30,160(7)
571,230
Alberto L. Satine8,000
26.02
3/14/2017
16,995(3)
321,885
  
 




9,320(4)
176,521
  
    
7,490(5)
141,861
  
      
9,046(6)
171,331
      
18,092(6)
342,662
      
3,635(7)
68,847
     
14,540(7)
275,388
Norman Willemse9,700
10.08
6/25/2018
12,589(3)
238,436
  
 




6,645(4)
125,856
  
    
5,521(5)
104,568
  
      
6,450(6)
122,163
      
12,900(6)
244,326
      
2,680(7)
50,759
      
10,718(7)
202,999

(1)Reflects stockAll outstanding options granted on May 30, 2012 under the 2012 Omnibus Incentive Plan. The options vest ratably in three equal annual installments beginning in May 2013.are vested as of December 31, 2015.

(2)Reflects value of outstanding RSUs using a share price of $11.20,at $18.94, the closing price of AAM common stock on December 31, 2012.2015.

(3)Reflects RSUs granted on May 30, 2012 under the 2012 Omnibus Incentive Plan.March 6, 2013 that vested on March 6, 2016.
(4)Reflects RSUs for Mr. D.C. Dauch, Mr. Simonte and Mr. Willemsegranted on March 6, 2014. RSUs vest three years from the date of grant. RSUs for Mr. R.E. Dauch and Mr. Bellanti vest ratably in three approximately equal annual installments beginning in May 2013.

(4)
(5)Reflects RSUs granted on September 1, 2012 under the 2012 Omnibus Incentive Plan under the terms of Mr. D.C. Dauch’s and Mr. R.E. Dauch’s employment agreements. TheMarch 2, 2015. RSUs for Mr. D.C. Dauch vest three years from the date of grantgrant.
(6)Reflects performance shares granted on March 6, 2014 for the performance period January 1, 2014 through December 31, 2016 that would be paid at the end of the performance period based on actual performance through December 31, 2015. The TSR awards reflect a target payout and for Mr. R.E. Dauch vest ratably in three approximately equal annual installments beginning in September 2013.the EBITDA awards reflect a maximum payout. Payouts will be determined at the end of the performance period based on actual performance.

(7)
Reflects performance shares granted on March 2, 2015 for the performance period January 1, 2015 through December 31, 2017 that would be paid out at the end of the performance period based on actual performance through December 31, 2015. The TSR award amounts reflect a threshold payout and the EBITDA award reflecta maximum payout. Payouts will be determined at the end of the performance period based on actual performance.
(8)Reflects the value of 2014 and 2015 performance shares based on performance through December 31, 2015 as described above in footnotes (6) and (7) multiplied by the closing price of AAM common stock on December 31, 2015.

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OPTIONS EXERCISED AND STOCK VESTED

   Option Awards  Stock Awards 
Name Number of
Shares
Acquired on
Exercise(1)
(#)		  Value
Realized  on
Exercise(1)
($)		  Number of
Shares
Acquired on
Vesting(2)(3)
(#)		  Value
Realized  on
Vesting(4)
($)		 

David C. Dauch

  —    —    4,500    52,245  

Michael K. Simonte

  —    —    3,600    41,796  

Richard E. Dauch

  49,500    484,605    19,681    224,363  

John J. Bellanti

  —    —    3,600    41,796  

Norman Willemse

  —    —    6,000    69,660  

  
Option AwardsStock Awards
Name
Number of
Shares
Acquired on
Exercise (1)
(#)
Value
Realized  on
Exercise (1)
($)
Number of
Shares
Acquired on
Vesting(2)
(#)
Value
Realized  on
Vesting(3)
($)
David C. Dauch—
—
101,708
2,420,267
Christopher J. May—
—
—
—
Michael K. Simonte10,000
69,601
34,466
865,441
Alberto L. Satine—
—
13,929
349,757
Norman Willemse—
—
13,520
339,487
Terry J. Woychowski (4)
—
—
23,990
535,238

(1)Reflects the number of shares acquired upon exercise of stock options. Value realized upon exercise is based on the difference between the actual salesmarket price of the AAM common stock acquired upon exercise and the exercise price for such stockof the options.

(2)Reflects the lapsenumber of the transfer and forfeiture restrictionsshares vested in May 2015 under RSU awards of performance accelerated restricted stock granted in March 2007 toMay 2012. For Mr. D.C. Dauch, Mr. Simonte, Mr. Bellanti and Mr. Willemse. These awardsalso includes the number of shares vested in MarchSeptember 2015 under an RSU award granted in September 2012.

(3)Reflects the lapse of the transfer and forfeiture restrictions under the award of restricted stock granted to Mr. R.E. Dauch in January 2009. The award vested in three approximately equal annual installments through January 2012.

(4)(3)Reflects the number of shares underlying vested performance accelerated restricted stock and restricted stock,RSUs multiplied by the closing market price of AAM common stock on the vesting date.

(4)Reflects the number of shares (approximately 1/3) that vested ratably in March 2015 under an RSU award granted in March 2013. Amount also includes the pro-rata vesting (at target) of 2/3 of the performance share awards granted in March 2014 and 1/3 of the performance share awards granted in March 2015 in connection with the termination of Mr. Woychowski's employment in December 2015.

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Table of Contents

PENSION BENEFITS

The NEOs are eligible to participate in pension plans that provide benefits based on years of service and pay. The following table shows the value of the benefits accumulated by the NEOs (other than Mr. Woychowski) and their years of credited service under AAM’s Salaried Retirement Program (SRP), the Albion Pension Plan and AAM’s Supplemental Executive Retirement Program (SERP). The years, each effective as of credited service are through December 31, 2012, AAM’s fiscal year-end measurement date used for financial statement reporting purposes. The values shown are based on unreduced benefits deferred to the earliest age at which unreduced benefits are payable. The assumptions used to calculate the actuarial present value of accumulated benefits are the same assumptions used in our audited consolidated financial statements for the fiscal year ended December 31, 2012, except that the values in the table do not reflect assumptions for future compensation increases or future service credits and assume continued service until unreduced retirement age is attained. See Note 6 to the audited consolidated financial statements in our Annual Report on Form 10-K for material assumptions.

Name Plan Name  Number of
Years of
Credited
Service
(#)		   Present
Value of
Accumulated
Benefit
($)		 

David C. Dauch

 AAM Retirement Program for Salaried Employees   11.5000     296,563  
  AAM Supplemental Executive Retirement Program   17.5000     1,326,013  

Michael K. Simonte

 AAM Retirement Program for Salaried Employees   8.0833     197,858  
  AAM Supplemental Executive Retirement Program   14.0833     765,129  

Richard E. Dauch(1)

 AAM Retirement Program for Salaried Employees   17.8333     991,169  
  AAM Supplemental Executive Retirement Program   23.0000    29,718,734  

John J. Bellanti(2)

 AAM Retirement Program for Salaried Employees   17.8333     979,008  
  AAM Supplemental Executive Retirement Program   18.8333     917,081  

Norman Willemse(3)

 Albion Pension Plan   6.3333     260,915  
  AAM Supplemental Executive Retirement Program   10.9167     282,554  

2015.
NamePlan Name
Number of
Years of
Credited
Service(1)
(#)
Present
Value of
Accumulated
Benefit(2)
($)
David C. DauchAAM Retirement Program for Salaried Employees11.5000329,766
AAM Supplemental Executive Retirement Program20.50003,821,527
Christopher J. MayAAM Retirement Program for Salaried Employees12.5000141,795
AAM Supplemental Executive Retirement Program21.5000406,650
Michael K. SimonteAAM Retirement Program for Salaried Employees8.0833220,170
AAM Supplemental Executive Retirement Program17.08331,494,233
Alberto L. Satine(3)
AAM Retirement Program for Salaried Employees10.5833504,473
AAM Supplemental Executive Retirement Program14.5833638,564
Norman Willemse(4)
Albion Pension Plan6.3333309,197
AAM Supplemental Executive Retirement Program14.5000583,430

(1)The years of credited service are through December 31, 2015. Benefits under the SRP were frozen effective December 31, 2006 for Mr. R.E. Dauch, Mr. May and Mr. Simonte. Benefits under the SRP were frozen effective December 31, 2011 for Mr. Satine. As a result, credited service under the SRP is less than actual service with the Company. Credited service under the SERP reflects actual years of service with the Company.
(2)The values shown are based on benefits deferred to the earliest age at which unreduced benefits are payable. The assumptions used to calculate the actuarial present value of accumulated benefits are the same assumptions used in our audited consolidated financial statements for the fiscal year ended December 31, 2015 and assume continued employment until unreduced retirement age is attained. For material assumptions used, see Note 5 to the audited consolidated financial statements in our annual report on Form 10-K for the fiscal year ended December 31, 2015.
(3)Mr. Satine was eligible to retire on December 31, 2012 with full benefits2015 under both the Salaried Retirement Program and the SERP.

(2)Mr. Bellanti was eligible to retire on December 31, 2012 under the Salaried Retirement ProgramSRP and the SERP. He qualifies for a reduced benefit of approximately 80%61% of the unreduced benefit under the Salaried Retirement ProgramSRP and for the basic form oflump sum benefit under the SERP.

(3)
(4)Mr. Willemse is not a participant underin the Salaried Retirement Program.SRP. Mr. Willemse was eligible to retire on December 31, 20122015 under both the Albion Pension Plan and the SERP. He qualifies for the currentlump sum benefit formula under the SERP.

We provide pension benefits under our





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Table of Contents

Salaried Retirement Program a broad-based defined benefit pension plan covering substantially all U.S. salaried associates hired prior to January 1, 2007, and our SERP. The purpose of the SERP is to provide total retirement benefits at a competitive level with executives of other major industrial companies. Our Albion Automotive Limited subsidiary located in Glasgow, Scotland provides pension benefits under the Albion Pension Plan for its salaried associates. Mr. Willemse was a participant in the Albion Pension Plan while an associate of Albion Automotive Limited.

(SRP).Salaried Retirement Program. The annual retirement benefit payable to each executive, commencing on retirement at or after age 65, equals the sum of the executive’s contributions plus an additional benefit based on the executive’s average monthly salary (determined as the average of the executive’s base salary in the highest 60 months during his final 10 years of service) and years of credited service. The plan also includes a cash benefit structure for participants hired between January 1, 2002 and December 31, 2006. None of the NEOs are covered by the cash benefit structure. The amount of compensation that may be taken into account for determining benefits is limited under the Internal Revenue Code.

Benefits under the Salaried Retirement ProgramSRP may be paid as a single life annuity or, upon election, in the form of a joint and survivor annuity with a reduction in the amount of the annual benefit.

The SRP is a qualified plan subject to Internal Revenue Code (IRC) limitations on benefits and is subject to Employee Retirement Income Security Act of 1974.

Effective December 31, 2006, the Salaried Retirement ProgramSRP was amended to freeze benefits at current levels for associates who were not eligible to retire by December 1, 2011. Those associatesAssociates who were eligible for early or normal retirement on or before December 31, 2011 continued to accrue benefits through December 31, 2011. Mr. R.E. Dauch and Mr. Bellanti were grandfathered and thus continued to accrue benefits through December 31, 2011. The NEOs did not accrue
Albion Pension Plan. Our Albion Automotive Limited subsidiary provides pension benefits under the plan in 2012.

Albion Pension Plan.Plan for its salaried associates. Mr. Willemse is a participant in this plan as based on his former employment with this subsidiary. The annual retirement benefit payable, commencing on retirement at or after age 65, is based on the executive’sparticipant's average salary (determined as the average of the executive’s base salary(as defined in the highest 36 monthsplan during the final 10 years of service with Albion Automotive Limited), years of pensionable service and the percentage of participant contributions made to the plan. Benefits under the Albion Pension Plan will be paid as an annuity; however, aThe participant may elect benefits to be in the form of an annuity or to receive a portion of the benefit payable in a lump sum.

Supplemental Executive Retirement Program.    Mr. R.E. Dauch and Mr. Bellanti,Program (SERP). Executive officers who wereare grandfathered under the Salaried Retirement Program,SRP are eligible to receive the basic form of pension benefit under ourthe SERP upon retirement. In addition, they arethe executive may be eligible to receive the alternative form of benefit, if greater than the basic benefit, upon retirement at or after age 62. The executive must have at least 10 years of credited service to receive either form of benefit under the SERP.

The total monthly benefit payable under the basic form of SERP is equal to the following amount:

Two percent of the executive’s average monthly salary calculated as of December 31, 2011 (as determined for the Salaried Retirement ProgramSRP excluding the limitations as specified under the Internal Revenue Code)IRC), multiplied by the executive’s years of credited service; less

The benefit payable to the executive under the Salaried Retirement ProgramSRP (without reduction for survivor benefits), plus 2% of the maximum monthly social security benefit payable at age 65 multiplied by the executive’s years of credited service.

The Compensation Committee has discretion to reduce or eliminate the amount payable under the alternative form of benefit. Subject to the Compensation Committee’s discretion, the total monthly benefit payable under the alternative form of SERP is equal to the following amount:

1.5% of the executive’s average monthly salary calculated as of December 31, 2011 (as determined for the Salaried Retirement ProgramSRP excluding the limitations as specified under the Internal Revenue Code)IRC) and average monthly incentive compensation as of December 31, 2011 (determined as the average of the highest five of the executive’s last 10 annual cash incentive awards, divided by 12) multiplied by the executive’s years of credited service; less

The benefit payable to the executive under the Salaried Retirement ProgramSRP (without reduction for survivor benefits), plus the maximum monthly social security benefit payable at age 65.

SERP benefits payable under the basic and alternative forms are generally paid as a single life annuity. If the executive’s spouse is eligible for survivor benefits under the Salaried Retirement Program,SRP; however, the executive’s monthly SERP benefit will be reduced and paid in the form of a joint and survivor annuity.

Mr. D.C. Dauch, Mr. May, Mr. Simonte and Mr. Willemse, who wereare not grandfathered under the Salaried Retirement Program,SRP, are eligible to receive a benefit under the current SERP formula, payable six months after retirement in a lump sum. TheAs a grandfathered participant, Mr. Satine may alternatively be eligible to receive a benefit under the current SERP formula if this benefit is greater than that under the basic or alternative benefit described above. Under the current SERP formula, the amount of the benefit will be equal to 12.5% of the executive’s final average compensation (determined as the executive’s average annual base salary and cash incentive for the highest five consecutive years), multiplied by the executive’s years of credited service, less the sum of the actuariallyactuarial equivalent value of the executive’s benefits payable under the Salaried Retirement Program,SRP, Albion Pension Plan and the balance of the executive’s employer retirement contribution account under AAM’s 401(k) plan.

Effective August 1, 2012, the SERP was amended and restated to implement actuarial increases for participants who remain employed after reaching age 65. As a result, participants who work past age 65 will receive an increased annual SERP benefit when they retire to reflect a shorter expected payment period due to delayed retirement. This amendment had an impact on Mr. R.E. Dauch’s SERP benefit for 2012, which is shown in theSummary Compensation Table. The amended and restated SERP also provides that a participant’s entire SERP benefit will be forfeited if the participant’s employment with AAM is terminated for cause (as defined in the plan).


37
Table of Contents

NONQUALIFIED DEFERRED COMPENSATION

The following table summarizes thedeferred compensation of NEOs compensation under the Executive Deferred Compensation Plan for the 20122015 fiscal year.

Name  Executive
Contributions
in Last FY(1)
($)		   Registrant
contributions in
Last FY(2)
($)		   Aggregate
Earnings
In Last FY(3)
($)		   Aggregate
Withdrawals
Distributions
($)		   Aggregate
Balance at
Last FYE(4)
($)		 

David C. Dauch

   —     —     38,630     —     301,238  

Michael K. Simonte

   —     —     —     —     —  

Richard E. Dauch

   —     —     532,099     —     5,502,317  

John J. Bellanti

   —     —     65,112     —     567,875  

Norman Willemse

   25,264     513     1,595     —     27,372  

Name
Executive
Contributions
in Last FY
($)
Registrant
contributions in
Last FY
($)
Aggregate
Earnings
In Last FY(1)
($)
Aggregate
Withdrawals
Distributions
($)
Aggregate
Balance at
Last FYE(2)
($)
David C. Dauch—
—
10,307
—
385,522
Christopher J. May—
—
—
—
—
Michael K. Simonte—
—
—
—
—
Alberto L. Satine—
—
—
—
—
Norman Willemse—
—
(1,993)—
126,703
Terry J. Woychowski—
—
—
—
—

(1)For Mr. Willemse, reflects $17,083 of his 2012 base salary and $8,181 of his 2011 annual incentive award paid March 2012. Base salary amounts deferred are included in the salary column for 2012 in theSummary Compensation Table and the 2011 annual incentive award deferred is included in the non-equity incentive compensation column for 2011 in theSummary Compensation Table.

(2)Reflects the Company 3% match on 2012 base salary deferred by Mr. Willemse. Amount is included in the all other compensation column for 2012 in theSummary Compensation Table.

(3)
Reflects hypothetical accrued earnings or losses during 20122015 on notional investments designed to track the performance of funds similar to those available to participants in the Company’s 401(k) plan. None of the earnings shown in this column are reported as compensation in theSummary Compensation Table.

(4)
(2)
Of the aggregate balance, the amounts reflect compensation previously reported in the Summary Compensation Table for each of the NEOs. For Mr. Willemse, the amount includes $17,596 reported as compensation in theSummary Compensation Table for 2012.

Under AAM’s Executive Deferred Compensation Plan, a nonqualified, tax-deferred savings plan, certain executives, including ourthe NEOs, may elect to defer payment of 6% to 75% of their base salary and/or their annual incentive award during any plan year. Base salary deferred into the plan receives a 3% Company match. Matching contributions are vested after five years of credited service. The amounts deferred are unfunded and unsecured obligations of AAM.

Amounts deferred or credited into this plan are represented in the executive’s notional account and are “invested” among funds similar to those available under AAM’s 401(k) plan. Forty percent of deferral elections are automatically and irrevocably allocated to the restricted investment benchmark, the PIMCO Total Return Fund. The remaining 60% may be allocated by the executive to any of the investments available under the plan and reallocated on a daily basis among the investments available. Although the executive has no actual or constructive ownership of shares in the investment funds, the return on the executive’s account is determined as if the amounts were notionally invested in these funds.


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The table below shows the investment fund options available under the Executive Deferred Compensation Plan and the annual rates of return for the calendar year ended December 31, 2012.

Name of Fund Rate of
Return		   Name of Fund Rate of
Return		 

Fidelity Retirement Money Market Portfolio

  .01%    

Vanguard External Market Index

  18.48%  

PIMCO Total Return Fund

  10.36%    

Fidelity Freedom Income K Fund

  6.36%  

PIMCO High Yield Fund

  14.55%    

Fidelity Freedom K 2000 Fund

  6.44%  

Domini Social Equity Fund

  11.75%    

Fidelity Freedom K 2005 Fund

  8.77%  

Spartan U.S. Equity Index Fund

  15.96%    

Fidelity Freedom K 2010 Fund

  10.53%  

Touchstone Value Y Fund

  15.38%    

Fidelity Freedom K 2015 Fund

  10.81%  

American Funds Growth Fund of America

  20.92%    

Fidelity Freedom K 2020 Fund

  11.86%  

Fidelity Growth Company Fund

  18.52%    

Fidelity Freedom K 2025 Fund

  13.26%  

Fidelity Low-Priced Stock Fund

  18.50%    

Fidelity Freedom K 2030 Fund

  13.65%  

Nuveen Mid Cap Growth Opportunities

  15.12%    

Fidelity Freedom K 2035 Fund

  14.60%  

American Beacon Small Cap Value Fund

  16.52%    

Fidelity Freedom K 2040 Fund

  14.61%  

Royce PA Mutual Fund

  14.58%    

Fidelity Freedom K 2045 Fund

  14.97%  

Fidelity Diversified International Fund

  19.41%    

Fidelity Freedom K 2050 Fund

  15.23%  

Spartan International Index Fund

  18.78%    Fidelity Freedom K 2055 Fund  15.39%  

2015.

Name of Fund
Rate of
Return
Name of Fund
Rate of
Return
Fidelity Retirement Money Market Portfolio0.02 %Vanguard External Market Index(3.27)%
PIMCO Total Return Fund0.73 %Harding Loevner Institutional Emerging Market Fund(13.47)%
PIMCO High Yield Fund(1.85)%Fidelity Freedom Income K Fund(0.32)%
Dreyfus International Bond Fund(6.39)%Fidelity Freedom K 2005 Fund(0.17)%
Vanguard Total Bond Market Fund0.40 %Fidelity Freedom K 2010 Fund(0.23)%
Domini Social Equity Fund(6.91)%Fidelity Freedom K 2015 Fund(0.22)%
Spartan 500 Index Fund1.36 %Fidelity Freedom K 2020 Fund(0.14)%
Touchstone Value Y Fund(1.90)%Fidelity Freedom K 2025 Fund(0.15)%
T. Rowe Price Growth Stock Fund10.85 %Fidelity Freedom K 2030 Fund(0.13)%
Fidelity Growth Company Fund7.83 %Fidelity Freedom K 2035 Fund(0.13)%
Fidelity Low-Priced Stock Fund(0.45)%Fidelity Freedom K 2040 Fund(0.12)%
Nuveen Mid Cap Growth Opportunities(0.60)%Fidelity Freedom K 2045 Fund(0.14)%
American Beacon Small Cap Value Fund(5.04)%Fidelity Freedom K 2050 Fund0.15 %
Royce PA Mutual Fund(11.34)%Fidelity Freedom K 2055 Fund(0.11)%
Fidelity Diversified International Fund3.24 %Spartan International Index Fund(0.79)%
Distributions can be received (1) upon retirement in a lump sum or in annual payments over a period of five or ten years, (2) in a lump sum upon death, disability, termination of employment or change in control or (3) if elected by the executive,participant, during employment at a specified date after a minimum deferral period. The minimum deferral period is at least three years following the end of the plan year to which the deferral election relates and distributions during employment consist of employeeparticipant deferrals and related earnings or losses (not Company contributions and related earnings or losses).


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Table of Contents

POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL

The following tables show the estimated potential payments and benefits that each of the NEOs (other than Mr. Woychowski) would receive upon termination of employment under various circumstances that would trigger payments under applicable employment agreements and the Company’s plans and programs, assuming the termination event occurred on December 31, 2012.2015. Although the calculations are intended to provide reasonable estimates of the potential payments, they are based on numerous assumptions as described in the footnotes, and may not represent the actual amountamounts these NEOs would receive upon each termination event.

President & CEO and Executive Chairman For Mr. Woychowski, the table shows actual payments made in connection with termination of his employment without cause as of December 9, 2015.

Employment Agreements

Under our employment agreements with Mr. D.C. Dauch and Mr. R.E. Dauch,Simonte, the Company may terminate each executive’stheir employment with or without cause, or upon disability. With respect to each executive, causecause. Cause means:

a material breach of his obligations under the agreement;

the willful and continued failure or refusal to satisfactorily perform his duties;

a conviction of or pleading guilty (or no contest) to a felony or to another crime involving dishonesty or moral turpitude or which reflects negatively upon the Company or impairs its operations;

engaging in any misconduct, negligence, act of dishonesty (including any violation of federal securities laws) or violence that is materially injurious to the Company;

a material breach of a restrictive covenant (i.e., non-competition, non-solicitation) or Company policy;

refusal to follow the directions of the Board; or

any other willful misconduct that is materially injurious to theAAM's financial condition or business reputation.

In addition, each executiveMr. Dauch and Mr. Simonte may resign for good reason, which means:

a material decrease in compensation or a failure by the Company to pay material compensation;

a material diminution of responsibilities, positions or titles (other than solely as a result of the Company ceasing to be a publicly-traded company);

relocation more than 50 miles outside the Detroit-metropolitan area; or

a material breach by the Company.

Upon termination for cause or upon resignation without good reason, each executive wouldMr. Dauch and Mr. Simonte are entitled to receive only accrued and unpaid compensation. Participation in the Company’s benefit plans would cease upon termination.

If employment is terminated without cause or upon resignation for good reason on or within two years following a CIC, Mr. Dauch and Mr. Simonte are entitled to a severance payment of a multiple of annual base salary and annual bonus, plus a target annual bonus prorated through the termination date. The annual bonus payment is determined based on the higher of his target annual bonus for either the year of the CIC or the year of termination. The severance multiple for Mr. Dauch is three times and Mr. Simonte's multiple is two times. In addition, each executive would receive medical benefit continuation after termination of employment following a CIC; Mr. Dauch for three years and Mr. Simonte for two years. Each would also receive outplacement services; Mr. Dauch $50,000 and Mr. Simonte $30,000.
If employment is terminated without cause, or upon resignation for good reason not in connection with a CIC, Mr. Dauch and Mr. Simonte are entitled to receive accrued and unpaid compensation and continued payment of base salary for two years following termination. Mr. D.C. DauchEach would also receive $50,000 of outplacement services and health care benefits for two years.

Ifservices; Mr. R.E. Dauch’s employment is terminated for any reason other than for cause or upon his death, the Company will continue to reimburse premiums paid on a $5 million executive life insurance policy for two years.

The employment agreements for Mr. D.C. Dauch $50,000 and Mr. R.E. Dauch containSimonte $30,000.

Certain severance payments are subject to recoupment or clawback. Salary and benefit continuation is also subject to compliance with the following restrictive covenants that extend for two years following terminationconfidentiality, non-competition, non-solicitation and intellectual property assignment provisions of each employment or expirationagreement as well as the execution and non-revocation of the employment agreement:

non-disclosurea general waiver and confidentiality, which prohibit unauthorized use or disclosurerelease of AAM’s confidential information;

claims.

non-competition, which prohibits each of them from directly or indirectly engaging in any business that competes with AAM; and

non-solicitation, which prohibits solicitation of our employees and customers.

If employment with AAM terminates due to disability or death, Mr. D.C. Dauch and Mr. R.E. DauchSimonte will be entitled to accrued benefits under applicable benefit plans and programs (such as our Deferred Compensationprograms.

AAM Executive Officer Change in Control Plan Salaried Retirement
Under the AAM Executive Officer Change in Control Plan adopted in February 2015, upon termination of employment by the Company without cause or resignation by an executive officer (other than Mr. Dauch and SERP). Should Mr. D.C. DauchSimonte) for good reason on or Mr. R.E. Dauch die during the term of his employment agreement, his estate and/or spouse wouldwithin two years following a CIC, each eligible executive officer will be entitled to certain severance payments and benefits, in addition to other accrued compensation and benefits:
a cash amount equal to annual base salary multiplied by two;

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Table of Contents

a cash amount equal to target annual bonus multiplied by two, with target annual bonus determined as the greater of the target amount in the year of the CIC or the year of termination of employment;
reimbursement of outplacement service costs of up to $30,000 incurred within 24 months following termination of employment; and
continued participation in AAM's medical benefit plans for two years following termination of employment, or, in certain cases, a cash amount equal to the value of the benefit continuation.

For purposes of the CIC Plan, cause means: (1) the participant's willful and continued failure or refusal to satisfactorily perform his/her duties; (2) a conviction of or pleading guilty (or no contest) to a felony or to another crime involving dishonesty or moral turpitude or which reflects negatively upon the Company or impairs its operations; (3) engaging in any willful misconduct, gross negligence, act of dishonesty (including any violation of federal securities laws) or violence that is injurious to the Company; (4) a material breach of any restrictive covenant or any material written policy of the Company; (5) a material failure to comply with any material applicable laws and regulations or professional standards relating to the business of the Company; or (6) any other misconduct that is injurious to the financial condition or business reputation of the Company.

The CIC Plan defines good reason to include any of the following acts or omissions: (1) a material reduction in a participant's position, authority, duties or responsibilities following the CIC; (2) a material reduction in a participant's annual base salary or bonus opportunity in effect prior to the CIC; or (3) a relocation of the office at which the participant is to perform the majority of his or her duties following a CIC to a location more than 50 miles from such location prior to the CIC.
This salary and benefit continuation is subject to the executive officer's compliance with the confidentiality, non-competition, non-solicitation and intellectual property assignment provisions of the CIC Plan as well as the execution and non-revocation of a general waiver and release of claims. Certain severance payments are also subject to recoupment or clawback.
No Tax Gross Ups
The Company does not provide tax gross ups to executive officers upon a CIC. If any of the payments or benefits under applicable benefit plansMr. Dauch's or Mr. Simonte's employment agreement or the CIC Plan are deemed to be parachute payments under Section 280G of the Code and programs.

would be subject to the excise tax imposed under Section 4999 of the Code, the payments or benefits will be reduced by the amount required to avoid the excise tax if the reduction would give a better after-tax result than if the full payments and benefits were received.

Non-Competition Agreements

Pursuant to their non-competition agreements with the Company, Mr. Simonte,May, Mr. BellantiSatine, Mr. Willemse and Mr. Willemse have each entered into a non-competition agreement that prohibits,Woychowski are prohibited, while employed by AAM and for one year following termination of employment each executive(prior to a CIC), from:

directly or indirectly engaging in any business that competes with AAM;

soliciting or inducing our employees to leave AAM, or offering employment to our employees or otherwise interfering with our relationship with our employees, agents or consultants; and

using, exploiting or disclosing our confidential information to any third party without our prior written consent.


Potential Payments Upon Termination or Change in Control

David C. Dauch

The following table shows estimatedtables below reflect potential payments to each NEO (other than Mr. D.C. Dauch upon resignation for good reason, termination without cause, disability and a change in control as of December 31, 2012. Upon termination for cause or upon resignation without good reason, Mr. D.C. Dauch would receive only accrued and unpaid compensation. These amounts are not shown in the table below. Mr. D.C. Dauch was not eligible to retire as of December 31, 2012.

    For Good
Reason
Resignation
($)		   Without
Cause
Termination
($)		   Disability
Retirement(1)
($)		   Change in
Control
($)		 

Compensation:

                    

Severance(2)

   2,000,000     2,000,000     —     —  

Annual Incentive(3)

   540,000     540,000     540,000     —  

Long Term Incentives:

                    

RSUs(4)

   —     —     1,139,129     1,139,129  

2010 Performance Awards(5)

   —     1,209,600     1,209,600     —  

2011 Performance Awards(6)

   —     780,000     780,000     —  

2012 Performance Unit Awards(7)

   —     240,485     240,485     240,485  

Special Incentive Program(8)

   1,750,000     1,750,000     1,750,000     —  

Other Benefits:

                    

Deferred Compensation(9)

   301,238     301,238     301,238     301,238  

Health care(10)

   26,676     26,676     322,562     —  

Disability(11)

   —     —     7,756,067     —  

Life Insurance(12)

   —     —     139,920     —  

Outplacement Services(13)

   50,000     50,000     —     —  

Total

   4,667,914     6,897,999     14,179,001     1,680,852  

  (1)Assumes total and permanent disability on December 31, 2012. Because Mr. D.C. Dauch has more than 10 years of service, he is eligible to retire due to total and permanent disability and receive pension and postretiree health care benefits. Amount assumes continued employment (on leave) until retirement.

  (2)Upon termination without cause or resignation for good reason, Mr. D.C. Dauch is entitled to receive two years’ base salary payable semimonthly.

  (3)Under AAM’s Incentive Compensation Plan for Executive Officers, the award payout is pro-rated through the date of disability. Under Mr. D.C. Dauch’s employment agreement, he is entitled to accrued and unpaid compensation upon termination without cause or resignation for good reason. The amount reflects the 2012 award paid in March 2013.

  (4)Outstanding RSUs vest upon termination of employment due to death, disability or upon a change in control. The value reflects the number of RSUs multiplied by the closing price of AAM stock on December 31, 2012.

  (5)The 2010 performance award payable in the event of disability or termination without cause would be based on actual performance through December 31, 2012. Reflects award earned through December 31, 2012 and paid in March 2013.

  (6)The 2011 performance award payable in the event of a disability or termination without cause would be based on actual performance and the pro-rata portion of employment as compared to the performance period. As of December 31, 2012, two-thirds of the performance period would have lapsed. Reflects pro-rata award assuming target is achieved. The actual payout may range from 0% to 200%.

  (7)

The 2012 performance unit awards payable in the event of a disability, termination without cause or upon a change in control would be based on actual performance and the pro-rata portion of

employment as compared to the performance periods for each award. As of December 31, 2012, approximately 25% of the performance periods would have lapsed. Reflects pro-rata award assuming target is achieved. The actual payout may range from 0% to 200%.

  (8)Under the special incentive program, in the event of disability, resignation for good reason or termination without cause, Mr. D.C. Dauch is entitled to program amounts earned and not previously paid. Reflects the remaining two annual installments of $875,000.

  (9)Assumes amount is payable in a lump sum upon occurrence of termination event.

(10)Under Mr. D.C. Dauch’s employment agreement, he is entitled to two years of health care benefits (including his spouse) if his employment is terminated without cause or if he resigns for good reason. Under the disability scenario, reflects health care benefits until retirement.

(11)Reflects benefits equal to 100% of base salary for year one and 60% of base salary until retirement.

(12)Under the disability scenario, reflects basic and supplemental life insurance benefits until retirement at age 65.

(13)Under Mr. D.C. Dauch’s employment agreement, he is entitled to receive $50,000 of outplacement services if his employment is terminated without cause or if he resigns for good reason.

Michael K. Simonte

The following table shows estimated potential payments to Mr. Simonte upon resignation for good reason, termination without cause, disability and a change in control as of December 31, 2012. Upon termination for cause or upon resignation without good reason, Mr. Simonte would receive only accrued and unpaid compensation. These amounts are not shown in the table below. Mr. Simonte was not eligible to retire as of December 31, 2012.

    For Good
Reason
Resignation
($)		   Without
Cause
Termination
($)		   Disability
Retirement(1)
($)		   Change in
Control
($)		 

Compensation:

                    

Annual Incentive(2)

   —     —     220,000     —  

Long Term Incentives:

                    

RSUs(3)

   —     —     386,019     386,019  

2010 Performance Awards(4)

   —     720,000     720,000     —  

2011 Performance Awards(5)

   —     412,000     412,000     —  

2012 Performance Unit Award(6)

   —     86,384     86,384     86,384  

Special Incentive Program(7)

   1,000,000     1,000,000     1,000,000     —  

Other Benefits:

                    

Health care(8)

   —     —     318,431     —  

Disability(9)

   —     —     4,428,641     —  

Life Insurance(10)

   —     —     73,864     —  

Total

   1,000,000     2,218,384     7,645,339     472,403  

  (1)Assumes total and permanent disability on December 31, 2012. Because Mr. Simonte has more than 10 years of service, he is eligible to retire due to total and permanent disability and receive pension and postretiree health care benefits. Amount assumes continued employment (on leave) until retirement.

  (2)Under AAM’s Incentive Compensation Plan for Executive Officers, the award payout is pro-rated through the date of disability. The amount reflects the 2012 award paid in March 2013.

  (3)Outstanding RSUs vest upon termination of employment due to death, disability or upon a change in control. The value reflects the number of RSUs multiplied by the closing price of AAM stock on December 31, 2012.

  (4)The 2010 performance award payable in the event of disability or termination without cause would be based on actual performance through December 31, 2012. Reflects award earned through December 31, 2012 and paid in March 2013.

  (5)The 2011 performance award payable in the event of a disability or termination without cause would be based on actual performance and the pro-rata portion of employment as compared to the performance period. As of December 31, 2012, two-thirds of the performance period would have lapsed. Reflects pro-rata award assuming target is achieved. The actual payout may range from 0% to 200%.

  (6)The 2012 performance unit award payable in the event of a disability, termination without cause or upon a change in control would be based on actual performance and the pro-rata portion of employment as compared to the performance period. As of December 31, 2012, approximately 27% of the performance period would have lapsed. Reflects pro-rata award assuming target is achieved. The actual payout may range from 0% to 200%.

  (7)Under the special incentive program, in the event of disability, resignation for good reason or termination without cause, Mr. Simonte is entitled to award amounts earned and not previously paid. Reflects the remaining two annual installments of $500,000.

  (8)Under the disability scenario, reflects health care benefits until retirement.

  (9)Reflects benefits equal to 100% of base salary for year one and 66 2/3% of base salary until retirement.

(10)Under the disability scenario, reflects basic and supplemental life insurance benefits until retirement at age 65.

Richard E. Dauch

The following table shows estimated potential payments to Mr. R.E. DauchWoychowski) upon resignation for good reason, termination without cause, disability, retirement and a change in controlCIC as of December 31, 2012.2015. Upon termination for cause or upon resignation without good reason, Mr. R.E. Daucheach NEO would receive only accrued and unpaid compensation. These amounts are not shown in the table below. Mr. R.E. Dauch was eligible to retire on December 31, 2012.compensation and benefits. The assumptions used to determine retirement benefits for eligible NEOs are the same assumptionsas those used in our audited consolidated financial statements for the fiscal year ended December 31, 2012.2015. See Note 65 to the audited consolidated financial statements in our Annual Report2015 annual report on Form 10-K.

    For Good
Reason
Resignation
($)		   Without
Cause
Termination
($)		   Disability
Retirement(1)
($)		   Retirement
($)		   Change in
Control
($)		 

Compensation:

                         

Severance(2)

   4,000,000     4,000,000     —     —     —  

Bonus(3)

   4,000,000     4,000,000     4,000,000     4,000,000     —  

Retirement Plans:

                         

Defined Benefit

                         

Retirement Program(4)

   —     —     991,169     991,169     —  

SERP(5)

   —     —     29,718,734     29,718,734     —  

Welfare Benefit(6)

   —     —     1,391,904     1,391,904     —  

Equity:

                         

Stock Options(7)

   —     —     301,500     —     301,500  

RSUs(8)

   —     —     7,027,921     —     7,027,921  

Other Benefits:

                         

Deferred Compensation(9)

   5,502,317     5,502,317     5,502,317     5,502,317     5,502,317  

Life Insurance(10)

   47,780     47,780     47,780     47,780     —  

Total

   13,550,097     13,550,097     48,981,325     41,651,904     12,831,738  

Mr. Dauch, Mr. May and Mr. Simonte were not eligible to retire as of December 31, 2015. The footnotes following the tables provide additional detail regarding the potential payments and benefits shown for each termination scenario.



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Table of Contents

David C. DauchFor Good
Reason
Resignation
($)		Without
Cause
Termination
($)
Disability
Retirement(1)
($)
Retirement
($)

Termination Upon a Change in
Control(2)
($)
Compensation:     
Severance
2,300,000(3)

2,300,000(3)

—
—
3,450,000(4)

Annual Incentive
2,256,875(3)

2,256,875(3)

2,256,875(5)

—
6,569,375(4)

Long Term Incentives:     
RSUs(6)
—
—
4,966,144
—
4,966,144
2013 Performance Unit Awards(7)
—
2,852,500
2,852,500
—
2,852,500
2014 Performance Share Awards(8)
—
1,628,663
1,628,663
—
1,628,663
2015 Performance Share Awards(9)
—
711,664
711,664
—
2,134,993
      
Other Benefits:     
Retirement Plans—
—
—
—
—
SERP—
—
—
—
—
Welfare Benefit—
—
—
—
—
Deferred Compensation(10)
385,522
385,522
385,522
—
385,522
Health care(11)
34,754
34,754
320,403
—
53,903
Disability(12)
—
—
7,623,096
—
—
Life Insurance(13)
—
—
98,206
—
—
Outplacement Services(14)
50,000
50,000
—
—
50,000
Total5,027,151
10,219,978
20,843,073
—
22,091,100

Christopher J. MayFor Good
Reason
Resignation
($)		Without
Cause
Termination
($)
Disability
Retirement(1)
($)
Retirement
($)

Termination Upon a Change in
Control(2)
($)
Compensation:     
Severance—
—
—
—
700,000(15)

Annual Incentive—
—
297,646(5)

—
717,646(15)

Long Term Incentives:     
RSUs(6)
—
—
433,025
—
433,025
2013 Performance Unit Awards—
—
—
—
—
2014 Performance Share Awards—
—
—
—
—
2015 Performance Share Awards—
—
—
—
—
      
Other Benefits:     
Retirement Plans—
—
—
—
—
SERP—
—
—
—
—
Welfare Benefit—
—
—
—
—
Deferred Compensation—
—
—
—
—
Health care(16)
—
—
419,808
—
30,944
Disability(12)
—
—
3,162,867
—
—
Life Insurance(13)
—
—
26,744
—
—
Outplacement Services(17)
—
—
—
—
30,000
Total—
—
4,340,090
—
1,911,615






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Table of Contents

Michael K. SimonteFor Good
Reason
Resignation
($)		Without
Cause
Termination
($)
Disability
Retirement(1)
($)
Retirement
($)

Termination Upon a Change in
Control(2)
($)
Compensation:     
Severance
1,280,000(3)

1,280,000(3)

—
—
1,280,000(4)

Annual Incentive
887,573(3)

887,573(3)

887,573(5)

—
2,167,573(4)

Long Term Incentives:     
RSUs(6)
—
—
1,470,824
—
1,470,824
2013 Performance Unit Awards(7)
—
886,394
886,394
—
886,394
2014 Performance Share Awards(8)
—
473,879
473,879
—
473,879
2015 Performance Share Awards(9)
—
190,410
190,410


571,230
      
Other Benefits:     
Retirement Plans—
—
—
—
—
SERP—
—
—
—
—
Welfare Benefit—
—
—
—
—
Deferred Compensation—
—
—
—
—
Health care(11)
34,754
34,754
315,131
—
34,754
Disability(12)
—
—
4,561,542
—
—
Life Insurance(13)
—
—
54,733
—
—
Outplacement Services(14)
30,000
30,000
—
—
30,000
Total2,232,327
3,783,010
8,840,486
—
6,914,654
Alberto L. SatineFor Good
Reason
Resignation
($)		Without
Cause
Termination
($)
Disability
Retirement
($)
Retirement
($)

Termination Upon a Change in
Control(2)
($)
Compensation:     
Severance—
—
—
—
1,020,000(15)

Annual Incentive—
—
547,145(5)

547,145(5)

1,363,145(15)

Long Term Incentives:     
RSUs(6)
—
—
640,267
164,967
640,267
2013 Performance Unit Awards(7)
—
352,080
352,080
352,080
352,080
2014 Performance Share Awards(8)
—
228,442
228,442
228,442
228,442
2015 Performance Share Awards(9)
—
91,796
91,796
91,796
275,388
      
Other Benefits:     
Retirement Plans(18)
504,473
504,473
727,130
434,290
504,473
SERP(19)
638,564
638,564
409,396
638,564
638,564
Welfare Benefit(20)
—
—
14,216
—
—
Deferred Compensation—
—
—
—
—
Health care(16)
—
—
—
—
47,384
Disability—
—
—
—
—
Life Insurance—
—
—
—
—
Outplacement Services(17)
—
—
—
—
30,000
Total1,143,037
1,815,355
3,010,472
2,457,284
5,099,743


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Table of Contents

Norman WillemseFor Good
Reason
Resignation
($)		Without
Cause
Termination
($)
Disability
Retirement
($)
Retirement
($)

Termination Upon a Change in
Control(2)
($)
Compensation:     
Severance—
—
—
—
900,000(15)

Annual Incentive—
—
482,775(5)

482,775(5)

1,202,775(15)

Long Term Incentives:     
RSUs(6)
—
—
468,860
118,760
468,860
2013 Performance Unit Awards(7)
—
260,800
260,800
260,800
260,800
2014 Performance Share Awards(8)
—
162,884
162,884
162,884
162,884
2015 Performance Share Awards(9)
—
67,666
67,666
67,666
202,999
      
Other Benefits:     
Retirement Plans(21)
309,197
309,197
286,746
286,746
309,197
SERP(19)
583,430
583,430
583,430
583,430
583,430
Welfare Benefit(20)
—
—
9,237
—
—
Deferred Compensation(10)
126,703
126,703
126,703
126,703
126,703
Health care(16)
—
—
—
—
47,385
Disability—
—
—
—
—
Life Insurance—
—
—
—
—
Outplacement Services(17)
—
—
—
—
30,000
Total1,019,330
1,510,680
2,449,101
2,089,764
4,295,033
Terry J. Woychowski (as of December 9, 2015)Without Cause
Termination
($)
Compensation:
Severance (actual payment amount)(22)
448,168
Annual Incentive—
Long Term Incentives:
RSUs(23)
—
2013 Performance Unit Awards (actual payment amount)(24)
440,100
2014 Performance Share Awards (actual pro-rated payment amount)(25)
259,454
2015 Performance Share Awards (actual pro-rated payment amount)(25)
101,205
Other Benefits:
Retirement Plans—
SERP—
Welfare Benefit—
Deferred Compensation—
Health care—
Disability—
Life Insurance—
Outplacement Services—
Total1,248,927

Notes to Termination Tables

(1)
Assumes retirement due to total and permanent disability on December 31, 2012.2015. Because Mr. Dauch, Mr. May and Mr. Simonte are not eligible to retire on December 31, 2015, the amounts assume continued employment (on leave) until retirement at 65.

(2)For Mr. Dauch and Mr. Simonte, amounts reflect CIC benefits under their employment agreements and outstanding LTI awards as of December 31, 2015. For other NEOs, amounts reflect payments and benefits under the CIC Plan and outstanding LTI awards as of December 31, 2015.
(3)Under their employment agreements, Mr. Dauch and Mr. Simonte are entitled to receive two years’ base salary (payable semimonthly) and accrued and unpaid compensation upon resignation for good reason or termination without cause. The annual bonus amounts reflect 2015 awards paid in March 2016.

44
Table of Contents

(4)Upon termination without cause or resignation for good reason on or within two years following a CIC, Mr. R.E. Dauch isand Mr. Simonte are entitled to receive two years’a multiple of base salary payable semimonthly.

  (3)Reflectsand annual bonus (Mr Dauch, three times; Mr. R.E. Dauch’s cashSimonte, two times) plus a target annual bonus earned in 2012 andprorated through termination. The severance amount for each reflects base salary as of December 31, 2015 times the applicable multiple. The annual bonus amount for each reflects the 2015 award paid in March 2013.2016 and the 2015 target bonus times the applicable multiple.

  (4)Reflects a present value of a joint and survivor annuity benefit payable monthly.

(5)The present value calculated assuming a joint and survivor annuity benefit payable monthly.

  (6)Reflects benefits for Mr. R.E. Dauch and his spouse assuming retirement or disability on December 31, 2012.

  (7)Outstanding stock option awards vest upon terminationIn the event of employment due to death, disability or upon a change in control. The value reflects the difference between the exercise price of the unvested options and the closing price of AAM stock on December 31, 2012.

  (8)Outstanding RSUs vest upon termination of employment due to death, disability or upon a change in control. The value reflects the number of RSUs multiplied by the closing price of AAM stock on December 31, 2012.

  (9)Assumes amount is payable in a lump sum upon occurrence of termination event.

(10)Represents reimbursement of two years’ premiums paid by Mr. R.E. Dauch for a $5 million executive life insurance policy.

John J. Bellanti

The following table shows estimated potential payments to Mr. Bellanti upon resignation for good reason, termination without cause, disability, retirement, and a change in control as of December 31, 2012. Upon termination for cause or upon resignation without good reason, Mr. Bellanti would receive only accrued and unpaid compensation. These amounts are not shown in the table below. Mr. Bellanti was eligible to retire on December 31, 2012. The assumptions used to determine retirement benefits are the same assumptions used in our audited consolidated financial statements for the fiscal year ended December 31, 2012. See Note 6 to the audited consolidated financial statements in our Annual Report on Form 10-K.

    For Good
Reason
Resignation
($)		   Without
Cause
Termination
($)		   Disability
Retirement(1)
($)		   Retirement
($)		   Change in
Control
($)		 

Compensation:

                         

Annual Incentive(2)

   —     —     140,000     140,000     —  

Retirement Plans:

                         

Defined Benefit

                         

Retirement Program(3)

   —     —     1,211,666     966,672     —  

SERP(4)

   —     —     644,007     917,081     —  

Welfare Benefit(5)

   —     —     219,800     219,800     —  

Equity:

                         

RSUs(6)

   —     —     355,163     —     355,163  

2010 Performance Awards(7)

   —     662,400     662,400     662,400     —  

2011 Performance Awards(8)

   —     379,040     379,040     379,040     —  

2012 Performance Unit Award(9)

   —     79,478     79,478     79,478     79,478  

Special Incentive Program(10)

   300,000     300,000     300,000     —     —  

Other Benefits:

                         

Deferred Compensation(11)

   567,875     567,875     567,875     567,875     567,875  

Total

   867,875     1,988,793     4,559,429     3,932,346     1,002,516  

  (1)Assumes retirement due to total and permanent disability on December 31, 2012.

  (2)Under AAM’s Incentive Compensation Plan for Executive Officers theprovides a pro-rata award payout is pro-rated through the date of disability or retirement. The amount reflects the 2012 award paidamounts reflect 2015 awards payable in March 2013.

  (3)Reflects2016 under a jointdisability termination event and survivor annuity benefit payable monthly.

  (4)The present value calculated assuming a joint and survivor annuity benefit payable monthly under the disability andalso upon retirement scenarios.

  (5)Reflects benefits for Mr. BellantiSatine and his spouse assuming retirement on December 31, 2012 under the retiree welfare benefit plan.Mr. Willemse.

(6)Outstanding RSUs vest upon termination of employment due to death, disability or upon a change in control.CIC. The value reflects the number of RSUs multiplied by the closing price of AAM common stock on December 31, 2012.

  (7)The 2010 performance award in2015. In the event of disability, retirement, or termination without cause would beRSUs granted in 2014 and 2015 vest pro-rata based on actual performancecontinued employment through December 31, 3012. Reflects award earned through December 31, 2012 and paid in March 2013.

  (8)The 2011 performance award payable inretirement. In the event of disability, retirement or termination without cause would be basedfor Mr. Satine and Mr. Willemse, the amounts reflect approximately 2/3 of their 2014 RSU awards and 1/3 of their 2015 RSU awards multiplied by the closing price of AAM common stock on actual performance and the pro-rata portion of employment as compared to the performance period. As of December 31, 2012, two-thirds of the performance period would have lapsed. Reflects pro-rata award assuming target is achieved. The actual payout may range from 0% to 200%.2015.

  (9)
(7)The 20122013 performance unit awardawards payable in the event of disability, retirement, termination without cause or upon a change in control would beCIC are determined based on actual performance through December 31, 2015. Amounts reflect awards earned through December 31, 2015 and paid in March 2016.
(8)The 2014 performance share awards payable in the event of a disability, retirement, termination without cause or upon a CIC are based on target performance and reflect the pro-rata portion of employment as compared toduring the performance period. As of December 31, 2012,2015, approximately 27%2/3 of the performance period would havehas lapsed. ReflectsAmounts reflect pro-rata award assumingawards at the target is achieved. The actual payout may range from 0% to 200%.

(10)Under the special incentive program, in the eventamount of disability, resignation for good reason or termination without cause, Mr. Bellanti is entitled to program amounts earned and not previously paid. Reflects the remaining two annual installments of $150,000.

(11)Assumes amount is payable in a lump sum upon occurrence of termination event.

Norman Willemse

The following table shows estimated potential payments to Mr. Willemse upon termination without cause, disability, retirement and a change in control as of December 31, 2012. Upon termination for cause or upon resignation without good reason, Mr. Willemse would receive only accrued and unpaid compensation. These amounts are not shown in the table below. Mr. Willemse was eligible to retire on December 31, 2012. The assumptions used to determine retirement benefits are the same assumptions used in our audited consolidated financial statements for the fiscal year ended December 31, 2012. See Note 6 to the audited consolidated financial statements in our Annual Report on Form 10-K.

    Without
Cause
Termination
($)		   Disability
Retirement(1)
($)		   Retirement
($)		   Change in
Control
($)		 

Compensation:

                    

Annual Incentive(2)

   —     95,000     95,000     —  

Retirement Plans:

                    

Defined Benefit

                    

Retirement Program(3)

   —     250,789     250,789     —  

SERP(4)

   —     282,554     282,554     —  

Welfare Benefit(5)

   —     12,740     —     —  

Long Term Incentives:

                    

RSUs(6)

   —     151,424     —     151,424  

2010 Performance Awards(7)

   281,808     281,808     281,808     —  

2011 Performance Awards(8)

   161,600     161,600     161,600     —  

2012 Performance Unit Award(9)

   33,884     33,884     33,884     33,884  

Other Benefits:

                    

Deferred Compensation(10)

   27,372     27,372     27,372     27,372  

Total

   504,664     1,297,171     1,133,007     212,680  

  (1)Assumes total and permanent disability on December 31, 2012.

  (2)Under AAM’s Incentive Compensation Plan for Executive Officers, the award payout is pro-rated through the date of disability or retirement. The amount reflects the 2012 award paid in March 2013.

  (3)Reflects Mr. Willemse’s benefits in the Albion Pension Plan as of December 31, 2012.

  (4)The present value calculated assuming a lump sum benefit under the disability and retirement scenarios.

  (5)Reflects benefits for Mr. Willemse and his spouse assuming retirement on December 31, 2012 under our retiree welfare benefit plan.

  (6)Outstanding RSUs vest upon termination of employment due to death, disability or upon a change in control. The value reflects the number of RSUsshares multiplied by the closing price of AAM common stock on December 31, 2012.2015.

  (7)
(9)The 20102015 performance award in the event of disability, retirement or termination without cause would be based on actual performance through December 31, 3012. Reflects award earned through December 31, 2012 and paid in March 2013.

  (8)The 2011 performance awardshare awards payable in the event of a disability, retirement or termination without cause would beare based on actualtarget performance and reflect the pro-rata portion of employment as compared toduring the performance period. As of December 31, 2012, two-thirds2015, approximately 1/3 of the performance period would havehas lapsed. ReflectsAmounts reflect pro-rata award assumingawards at the target is achieved.amount of shares multiplied by the closing price of AAM common stock on December 31, 2015. The actual payout may range from 0% to 200%.2015 performance share awards vest in full upon termination without cause or resignation for good reason on or within two years following a CIC.

  (9)
(10)Amounts reflect account balances in the Executive Deferred Compensation Plan as of December 31, 2015.
(11)Under their employment agreements, Mr. Dauch and Mr. Simonte are entitled to two years' health care benefits upon resignation for good reason or termination without cause. Upon termination on or within two years following a CIC, Mr. Dauch (three years) and Mr. Simonte (two years) are also entitled to health care benefits. In the event of disability, the amount reflects health care benefits until retirement.
(12)Reflects benefits equal to 100% of base salary for the first year of disability. Based on participant elections, amounts reflect 60% of base salary until retirement for Mr. Dauch and 66-2/3% for Mr. May and for Mr. Simonte.
(13)Reflects basic and supplemental life insurance benefits until retirement.
(14)Under their employment agreements, Mr. Dauch ($50,000) and Mr. Simonte ($30,000) are entitled to reimbursement for outplacement services upon termination without cause, resignation for good reason or termination of employment on or within two years following a CIC.
(15)Under the CIC Plan, Mr. May, Mr. Satine and Mr. Willemse are entitled to a cash payment equal to two times annual base salary and annual bonus upon termination without cause or resignation for good reason on or within two years following a CIC. The 2012 performance unitannual bonus amount is based on the greater of the target annual bonus for the year of the CIC or for the year of termination. The severance amount reflects base salary as of December 31, 2015 for two years. The annual bonus amount reflects the 2015 award payablepaid in March 2016 and the 2015 target annual bonus for two years.
(16)For Mr. May, Mr. Satine and Mr. Willemse, amounts reflect two years' health care benefits provided upon termination without cause or resignation for good reason on or within two years following a CIC. For Mr. May, in the event of disability, retirement,the amount reflects health care benefits until retirement.
(17)Under the CIC Plan, Mr. May, Mr. Satine and Mr. Willemse are entitled to reimbursement of up to $30,000 of outplacement services upon termination of employment without cause or uponresignation for good reason on or within two years of a changeCIC.
(18)Reflects a joint and survivor benefit payable monthly.
(19)Reflects the present value of the SERP benefit calculated assuming a lump sum payment for Mr. Satine and Mr. Willemse.
(20)Reflects welfare benefits assuming retirement under the retiree welfare plan.
(21)Reflects Mr. Willemse's benefits in control would be based on actual performance and the pro-rata portion of employmentAlbion Pension Plan as compared to the performance period. As of December 31, 2012, approximately 27% of2015.
(22)Under the performance period would have lapsed. Reflects pro-rata award assuming target is achieved. The actual payout may range from 0% to 200%.

(10)Assumes amount is payable inseparation agreement with Mr. Woychowski, AAM made a lump sum upon occurrenceseverance payment in exchange for his release of termination event.all claims against the Company.

(23)Upon his termination, Mr. Woychowski's outstanding RSUs were forfeited.
(24)Under the 2013 performance unit award agreement, Mr. Woychowski received a cash payout based on the Company's actual performance through December 31, 2015.
(25)Under the 2014 and 2015 performance share award agreements, Mr. Woychowski received pro-rata payouts upon termination of employment. The amounts reflect the number of shares multiplied by the closing price of AAM common stock on December 10, 2015.




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Table of Contents

PROPOSAL 2: ADVISORY VOTE ON EXECUTIVE COMPENSATION


AAM is seeking a non-binding advisory vote from our stockholders to approve the compensation of our named executive officers as disclosed in the Compensation Discussion and Analysis (CD&A) and narrative and tabular disclosures in this proxy statement. In the CD&A, we have providedprovide a detailed description of our compensation programs, including our compensation philosophy and objectives, the individual elements of executive pay, and how the programs are administered. We encourage you to review the CD&A, together with the other narrative and tabular disclosures, in considering your advisory vote on our named executive officers’ compensation.

Our executive officer compensation program is designed to reward performance that supports the achievement of the Company’sour business objectives and creates long-term stockholder value. The Compensation Committee considers the following fundamental objectives, among others, in determining our compensation programs:

Compensation and benefit programs should attract, motivate and retain experienced executives who are vital to our short-term and long-term success, profitability and growth.

growth;

Compensation and benefit programs should reward Company and individual performance; and

Compensation and benefit programs should foster the long-term focus required for successto deliver value to our stockholders.
Our executive officer compensation program also reflects an externally competitive compensation structure based on a market study of executive compensation programs in the global automotive industry.

Executive officers should be AAM stockholders.

The objectives of rewarding performance and retention should be balanced.

Features ofAAM's comparative peer group. In order to ensure that our compensation program drives performance in support of our strategic principles and cultural values, we regularly compare our compensation practices includeand governance against market best practices and stockholder feedback.

At our 2015 annual meeting of stockholders, over 98% of the following:

Payoutsvotes cast were in favor of annualthe Company's say-on-pay proposal. The Committee and long-term incentive awards are based on AAM’s performance as measured against a mix of pre-established financial metrics and total shareholder return.

Executive officers are required to comply with stock ownership requirements, which were increased by the Compensation Committee in 2012.

AAM prohibits hedging or pledging of Company stock.

There are no golden parachute agreements and no excise tax gross-ups upon a change of control.

For the reasons stated above, and more fully discussed in the CD&A, the Board unanimously recommendsconsidered this favorable outcome as a vote for the approvalreflection of our stockholders' strong support of the overall executive compensation ofprogram for our named executive officers.

NEOs.

Although the vote on this proposal is advisory and non-binding, the Board and the Compensation Committee will carefully consider the voting results when making future compensation decisions.


The Board unanimously recommends a vote FOR the approval of the compensation of our named executive officers.


46
2012
Table of Contents

2015 COMPENSATION OF NON-EMPLOYEE DIRECTORS

Total 20122015 compensation of our non-employee directors is shown below.

Name

  Fees Earned or
Paid in Cash(1)
($)		   Stock Awards
($)(2)		   Non-Equity
Incentive Plan
Compensation
($)(3)		   All Other
Compensation
($)(4)		   Total 

Salvatore J. Bonanno, Sr.

   75,000     80,003     76,000     —     231,003  

Elizabeth A. Chappell

   75,500     80,003     76,000     400     231,903  

Forest J. Farmer

   102,000     80,003     76,000     600     258,603  

Steven B. Hantler

   75,500     80,003     —     400     155,903  

Richard C. Lappin

   91,500     80,003     76,000     1,900     249,403  

James A. McCaslin

   79,000     80,003     76,000     —     235,003  

William P. Miller II

   87,000     80,003     76,000     —     243,003  

John F. Smith

   79,500     80,003     —     —     159,503  

Larry K. Switzer

   91,000     80,003     76,000     1,400     248,403  

Thomas K. Walker

   146,333     80,003     76,000     400     302,736  

Dr. Henry T. Yang

   78,000     80,003     76,000     8,200     242,203  

Name
Fees Earned or
Paid in Cash(1)
($)
Stock Awards(2)
($)
All Other Compensation(3)
($)
Total
($)
Elizabeth A. Chappell114,000
100,019
800
214,819
Forest J. Farmer(4)
45,000
—
3,700
48,700
Steven B. Hantler101,500
100,019
1,100
202,619
William L. Kozyra(5)
58,500
100,019
—
158,519
Richard C. Lappin(4)
55,000
—
—
55,000
Peter D. Lyons(5)
56,500
100,019
—
156,519
James A. McCaslin155,500
100,019
—
255,519
William P. Miller II120,500
100,019
—
220,519
John F. Smith116,000
100,019
300
216,319
Samuel Valenti III117,500
100,019
—
217,519
Thomas K. Walker(4)
45,000
—
1,100
46,100

(1)For Mr. Walker, reflects $33,333Fees earned in 2015 for services whether paid for his services as Non-Executive Chairman. Mr. Walker served in this temporary role from September 21, 2012 through January 31, 2013 duringcash or deferred under the absence of theAAM Executive Chairman for a medical procedure. Upon the recommendation of theDeferred Compensation Committee, the Board approved additional compensation for Mr. Walker at the rate of $10,000 per month. This amount was determined based on a market analysis provided by Meridian of non-executive chairman pay at companies in our comparative peer group and a broader general industry group.Plan.

(2)Reflects the full grant date fair value of equityrestricted stock unit awards granted on May 15, 2012April 30, 2015 calculated in accordance with FASB ASC 718 (without any reduction for risk of forfeiture) as determined based on applying the assumptions used in our financial statements. The grant date fair value of equity awards is calculated using the closing market price of AAM common stock on the grant date of $9.16.$24.93. See Note 96 to the audited consolidated financial statements in our Annual Reportannual report on Form 10-K for the year ended December 31, 20122015 regarding assumptions underlying the valuation of equity awards.

(3)Reflects amounts earned under the 2011 deferred compensation unit (DCUs) award. In April 2011, annual DCU awards of $80,000 were made to each non-employee director concurrent with the 2011 annual meeting of stockholders. These awards vested April 2012 and resulted in a payout of 95% of target, or $76,000, based on AAM’s total shareholder return.

(4)(3)The Company reimburses non-employee directors for their travel and related out-of-pocket expenses in connection with attending Board, Committeecommittee and stockholder meetings. From time to time, the Company invites spouses of non-employee directors to attend Company events associated with these meetings. The Company pays for spousal travel and certain other expenses and reimburses non-employee directors for taxes attributable to the income associated with this benefit. Amounts reflect reimbursement of taxes on this income.

(4)Mr. Farmer, Mr. Lappin and Mr. Walker served on the Board through April 30, 2015.
(5)Mr. Lyons and Mr. Kozyra joined the Board on April 30, 2015.


As of December 31, 2012,2015, each non-employee director had the following number of outstanding RSUs (including those deferred). No options and RSUs, including RSUs deferred:

Name

  Option Awards    
Outstanding    
(#)		   Restricted Stock
Units Outstanding
(#)		 

Salvatore J. Bonanno, Sr.

   —     8,734  

Elizabeth A. Chappell

   5,000     19,834  

Forest J. Farmer

   7,500     13,334  

Steven B. Hantler

   —     8,734  

Richard C. Lappin

   7,500     14,384  

James A. McCaslin

   —     8,734  

William P. Miller II

   7,500     23,084  

John F. Smith

   —     8,734  

Larry K. Switzer

   7,500     23,084  

Thomas K. Walker

   7,500     16,584  

Dr. Henry T. Yang

   7,500     19,834  

were outstanding as of December 31, 2015.

Name
Restricted Stock
Units Outstanding
(#)
Elizabeth A. Chappell36,584
Steven B. Hantler25,484
William L. Kozyra4,012
Peter D. Lyons4,012
James A. McCaslin25,484
William P. Miller II39,834
John F. Smith25,484
Samuel Valenti III9,471

47
Table of Contents

Narrative Description of Non-Employee Director Compensation

2012

2015 Annual Retainer and Meeting Attendance Fees

Annual retainer

  $60,000  

Board meeting attendance fee

   1,500  

Committee meeting attendance fee:

  

Committee chairman

   3,000  

Other committee members

   2,000  

The Board, upon recommendation of the Compensation Committee, approved a change to the structure of the non-employee director compensation effective August 1, 2015. In consideration of a market study of non-employee director compensation performed by Meridian, the non-employee director compensation was changed to eliminate meeting fees. In lieu of meeting fees, the non-employee director annual retainer was increased from $80,000 to $110,000, committee chair annual retainers were added, and the lead director annual retainer was increased from $20,000 to $30,000.
Effective August 1, 2015: 
Annual retainer$110,000
Committee chair annual retainer: 
Audit Committee chair20,000
Other committee chair10,000
Lead director annual retainer30,000
Non-employee director compensation included meeting attendance fees (Board $1,500; Committee Chairman $3,000; Committee members $2,000) through July 31, 2015.
Restricted Stock Units (RSUs).Each For 2015, each non-employee director is entitled to receivereceived an annual award of RSUs equal to a grant date value of $80,000$100,000 on April 30, 2015, the date of the annual stockholder meeting. The awards are payable in stock and vest in one year, unless vesting is accelerated upon death, disability or a change in control. In connection with the change in fee structure effective August 1, 2015, the Board also approved an increase to the 2016 non-employee director annual RSU award grant date value to $110,000.

Deferral.Non-employee directors may elect to defer, on a pre-tax basis, a portion of their retainer and meeting fees and receive tax-deferred earnings (or losses) on the deferrals under AAM’s Executive Deferred Compensation Plan. The rate of return on deferred amounts is based on the performance of selected benchmark funds identified in the plan, which is described inNonqualified Deferred Compensation above. Non-employee directors may also elect to defer settlement of RSUs until after termination of service from the Board.

Stock Ownership Guidelines.Upon stockholder approval of AAM’s 2012 Omnibus Incentive Plan, the The Compensation Committee decided to increase thehas adopted non-employee director stock ownership guidelines for non-employee directors in 2012 and change the measurement from a fixed number of shares to a multiple of the annual retainer. These new stock ownership guidelines were based on an analysis of prevalent external market practices provided by Meridian in 2012 at the direction of the Compensation Committee. Based on this analysis, the Compensation Committee increased the stock ownership guidelines from 4,000 sharesequal to a multiple of three times the annual retainer. Non-employee directors are expected to meet the guidelines within three years from April 2012 or, for new directors, within three years from the date of election to the Board. Shares owned directly, deferred RSUs and unvested RSUs count toward the guidelines while unexercised stock options are not included. Each non-employee director has met the ownership guidelines or is on track to meet these ownership guidelines. Current stock ownership of our non-employee directors is shown in theSecurity Ownership section below.

2013 Non-Employee Director Compensation.The BoardAnti-hedging and Anti-pledging policy. Non-employee directors are prohibited from entering into transactions that may result in a financial benefit if our stock price declines, or any hedging transaction involving our stock, including but not limited to the use of Directors, upon the recommendationfinancial derivatives, short sales or any similar transactions. Pledging of the Compensation Committee, approved an increase in the annual retainer and the valueCompany stock is also prohibited.

48
Table of annual

equity awards. Effective January 1, 2013, the annual retainer was increased to $80,000. The Board also approved an additional annual retainer of $20,000 for the lead director as compensation for the responsibilities and duties associated with that position. The value of the annual equity award for non-employee directors was increased to $100,000 effective on the date of the 2013 annual meeting of stockholders. These adjustments were made based on of a 2012 market study of non-employee director compensation performed by Meridian of companies in our comparative peer group.

Contents


SECURITY OWNERSHIP

The following tables show the number of shares of AAM common stock beneficially owned as of March 5, 20138, 2016 (unless otherwise noted) by:

•each person known to us who beneficially owns more than 5 percent5% of AAM common stock;

•each of our non-employee directors and nominees;

•

•our named executive officers (unless otherwise noted); and
•our named executive officers; and

all directors, nominees and executive officers as a group.

A beneficial owner of stock is a person who has voting power (the power to control voting decisions) or investment power (the power to cause the sale of the stock). All individuals listed in the tables have sole voting and investment power over the shares (unless otherwise noted).

The beneficial ownership calculation includes 74,839,56776,484,312 shares of AAM common stock outstanding on March 5, 2013.

8, 2016.

MORE THAN 5% BENEFICIAL OWNERS

The following persons have filed reports withtable below shows the SEC for the period ending December 31, 2012, stating that they beneficially ownname, address and share ownership of each person or organization known by us to be a beneficial owner of more than five percent5% of AAM’s common stock.

Name and Address

  Shares of
Common Stock
Beneficially
Owned		   Percent of
Shares
Outstanding		 

Barrow, Hanley, Mewhinney & Strauss, LLC(1)

   5,283,416     7.06  

2200 Ross Avenue, 31st Floor Dallas, TX 75201

    

The Vanguard Group(2)

   3,786,844     5.05  

100 Vanguard Blvd. Malvern, PA 19355

    

stock as of December 31, 2015.
Name and Address
Shares of
Common Stock
Beneficially
Owned
Percent of
Shares
Outstanding
Blackrock, Inc.(1)
6,318,1188.30
55 East 52nd Street, New York, NY 10055  
The Vanguard Group(2)
7,768,47510.21
100 Vanguard Blvd., Malvern, PA 19355  

(1)Based on the Schedule 13G filed on January 25, 2016 by Barrow, Hanley, Mewhinney & Strauss, LLC,Blackrock, Inc., reporting shared voting power over 2,508,300 shares, sole voting power over 2,775,1166,125,449 shares and sole investment power over 5,283,4166,318,118 shares.

(2)Based on the Schedule 13G filed on February 10, 2016 by The Vanguard Group, reporting sole voting power over 109,452166,135 shares, sole investment power over 3,679,9927,601,940, shared voting power over 4,600 shares and shared investment power over 106,852166,535 shares.



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Table of Contents

DIRECTORS, NOMINEES AND EXECUTIVE OFFICERS

   Shares
Beneficially
Owned(1)(2)		   Percent of
Shares
Outstanding		 

Directors

    

Salvatore J. Bonanno, Sr.

   25,000     *  

Elizabeth A. Chappell

   17,100     *  

Forest J. Farmer

   33,568     *  

Steven B. Hantler

   5,000     *  

Richard C. Lappin

   21,950     *  

James A. McCaslin

   4,000     *  

William P. Miller II

   27,850     *  

John F. Smith

   5,000     *  

Larry K. Switzer

   22,850     *  

Thomas K. Walker

   26,350     *  

Dr. Henry T. Yang

   19,600     *  

Named Executive Officers

    

David C. Dauch(3)

   119,131     *  

Michael K. Simonte

   101,951     *  

Richard E. Dauch(4)

   6,691,957     8.9  

John J. Bellanti(5)

   79,279     *  

Norman Willemse

   32,791     *  

Directors and Executive Officers as a Group (28 persons)

   7,615,039     10.0  

(*)
Less than 1 percent
Shares
Beneficially
Owned(1)(2)
Percent of the outstanding shares of AAM common stock.
Shares
Outstanding
Non-Employee Directors and Nominees
Elizabeth A. Chappell38,560
*
Steven B. Hantler30,484
*
William L. Kozyra4,012
*
Peter D. Lyons4,012
*
James A. McCaslin29,484
*
William P. Miller II47,534
*
John F. Smith30,484
*
Samuel Valenti III9,471
*
Named Executive Officers
David C. Dauch(3)
175,608
*
Christopher J. May11,503
*
Michael K. Simonte57,500
*
Alberto L. Satine33,991
*
Norman Willemse18,159
*
Terry J. Woychowski20,828
*
Directors, Nominees and Executive Officers as a Group
(28 persons)
693,448
*


(*) Less than 1% of the outstanding shares of AAM common stock.
(1)
Includes vested RSUs awarded to non-employee directors that have been deferred. For the number of RSUs held by each non-employee director, see table to the20122015 Compensation of Non-Employee Directors.

(2)Includes the following number of shares of common stock which may be acquired upon exercise of options that were exercisable or would become exercisable within 60 days: 5,000 for Ms. Chappell; 7,50028,000 for Mr. Farmer, Mr. Lappin, Mr. Miller, Mr. Switzer, Mr. Walker and Dr. Yang; 68,000 for Mr. D.C. Dauch; 50,00010,000 for Mr. Simonte; 750,0008,000 for Mr. R.E. Dauch; 52,700 for Mr. BellantiSatine; and 17,2009,700 for Mr. Willemse.

(3)Includes 548 shares held in trusts for the benefit of Mr. D.C. Dauch’s children.

(4)Includes 5,830,247 shares held in family trusts and 111,710 held in a tax-exempt charitable foundation. Mr. R.E. Dauch shares voting and investment power over 545,410 shares held by a family trust and the charitable foundation.

(5)Includes 10,000 shares held by Mr. Bellanti’s spouse.


Section 16(a) Beneficial Ownership Reporting Compliance

Section 16(a) of the Securities Exchange Act of 1934 requires our directors and executive officers, and persons who own more than 10% of a registered class of our equity securities, to file with the SEC initial reports of ownership and reports of changes in ownership of our common stock. Based solely on our review of these reports, and written representations from such reporting persons, we believe that the Section 16(a) filing requirements for such reporting persons were met during 2012.

2015.


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Table of Contents

PROPOSAL 3: RATIFICATION OF APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR 2012

2016

The Audit Committee of the Board of Directors of AAM has appointed Deloitte & Touche LLP to serve as the independent registered public accounting firm to examine the Company’s consolidated financial statements for the year ending December 31, 2013.2016. Although ratification is not required by our bylaws or otherwise, the Board is submitting the appointment of Deloitte & Touche LLP to our stockholders as a matter of good corporate practice. If the appointment is not ratified, the Audit Committee will consider whether the appointment is appropriate and will use its discretion in determining whether the appointment of Deloitte & Touche LLP is in the best interests of the Company and its stockholders.

Representatives of Deloitte & Touche LLP will attend the 20132016 annual meeting and be available to make a statement or respond to appropriate questions.

The Board unanimously recommends a vote FOR ratification of the appointment of Deloitte & Touche LLP as the Company’s independent registered public accounting firm for 2013.

2016.


AUDIT COMMITTEE DISCLOSURE

Report of the Audit Committee

The Audit Committee assists the Board in fulfilling its oversight responsibilities with respect to the Company’s financial reporting process by monitoring, among other matters, the quality and integrity of the Company’s financial statements, the independence and performance of Deloitte & Touche LLP (D&T), the Company’s independent registered public accounting firm, and the performance of the Company’s internal auditors. Management has primary responsibility for preparing the consolidated financial statements and for the reporting processes, including the design and maintenance of the Company’s system of internal controls. The independent registered public accounting firm is responsible for auditing the Company’s consolidated financial statements and opining upon the effectiveness of the internal control over financial reporting under the standards of the Public Company Accounting Oversight Board (PCAOB). The Audit Committee is solely responsible for the compensation, appointment and oversight of the Company’s independent registered public accounting firm.

In this context, the Audit Committee has met and held discussions with management, D&T and the internal auditors, separately and together, with and without management present, regarding the Company’s audited consolidated financial statements for the year ended December 31, 2012,2015, and the Company’s internal controls.controls over financial reporting. Management represented to the Audit Committee that the Company’s consolidated financial statements were prepared in accordance with generally accepted accounting principles in the U.S. The Audit Committee also discussed with the independent registered public accounting firmD&T the matters required to be discussed by PCAOB Auditing StandardsStandard No. 61,16, Communications with Audit Committees, as amended, applicable rules of the SEC, and other relevant professional and regulatory standards, which include, among other items, matters related to the conduct of the audit of the Company’s consolidated financial statements. Further, the Audit Committee discussed with the internal auditors the Company’s plans for and scope of internal audits, identification of audit risks and results of audit activities.

The Audit Committee reviewed and discussed with D&T the auditor’s independence from the Company and members of the Company’s management. As part of that review, D&T submitted to the Audit Committee the written disclosures and the letter required by the applicable requirements of the PCAOB regarding D&T’s communication with the Audit Committee concerning independence from the Company.independence. Further, the Audit Committee discussed with D&T the firm’s independence and considered whether D&T’s performance of non-audit services to the Company was compatible with maintaining D&T’s independence. The Audit Committee concluded that D&T is independent from the Company and its management.

Based uponon the considerations described above and subject to the limitations uponof the role and responsibilities of the Audit Committee, the Audit Committee recommended to the Board that the audited consolidated financial statements for the year ended December 31, 20122015 be included in the Company’s 2012 Annual Report2015 annual report on Form 10-K.

Audit Committee of the Board of Directors

William P. Miller II, Chairman

Peter D. Lyons
John F. Smith

Larry K. Switzer

Thomas K. Walker

Samuel Valenti III



51
Table of Contents

Policy for Pre-Approval of Audit and Non-Audit Services

The Audit Committee’s policy is to approve in advance all audit and permitted non-audit services (including scope, fee structure and the potential effect of the service on the auditor’s independence) to be performed for the Company by its independent registered public accounting firm. Pre-approval is generally provided for up to one year, is detailed as to the particular service or category of services and is generally subject to a specific budget. The Audit Committee may also pre-approve particular services on a case-by-case basis. The Chairman of the Audit Committee may pre-approve permissible non-audit services that arise between Audit Committee meetings, provided the fees do not exceed a limit established by the Audit Committee and the Audit Committee is informed of the decision to pre-approve the service at its next scheduled meeting. The Audit Committee received regular updates on the amount of fees and scope of audit, non-audit and tax services provided by D&T during 2012. During fiscal 2012, all2015. All services provided by D&T as noted in the table belowduring fiscal 2015 were authorized and approved by the Audit Committee in compliance with applicable pre-approval policies and procedures described herein.

procedures.

Independent Registered Public Accounting Firm’s Fees

The aggregate amountfollowing table shows the fees for professional services rendered by D&T for the audit of the Company's financial statements for the years ended December 31, 2015 and December 31, 2014, and fees billed for other services rendered by D&T, the member firms of Deloitte Touche Tohmatsu, and their respective affiliates during the previous two fiscal years is as follows:

   December 31, 
   2012   2011 

Audit Fees(1)

  $1,357,550    $1,181,000  

Audit Related Fees(2)

   —     —  

Tax Fees(3)

   80,539     238,000  

All Other Fees

   —     —  
  

 

 

   

 

 

 

Total

  $1,438,089    $1,419,000  
  

 

 

   

 

 

 

those periods.
 December 31,
 20152014
Audit Fees(1)
$2,110,826
$1,753,564
Audit Related Fees(2)
25,700
—
Tax Fees(3)
505,500
671,410
All Other Fees(4)
164,095
164,043
Total$2,806,121
$2,589,017

(1)IncludesAudit fees include fees for the audit of annual consolidated financial statements and internal controls over financial reporting, reviews of quarterly consolidated financial statements, statutory audits, consents and comfort letters, reviews of documents filed with the SEC and other services related to SEC matters. Audit fees also include fees incurred in connection with an audit of internal control over financial reporting as required by Section 404 of the Sarbanes-Oxley Act.

(2)Audit-related fees are for services that are reasonably related to the performance of the audit or review of the Company’s consolidated financial statements. This category includesalso refers to fees related to internal control, financial accounting and reporting standards.for the audit of employee benefit plans.

(3)Fees for tax services in 20122015 and 20112014 consisted of fees for tax compliance, tax advice and tax planning services.

(4)Other fees in 2015 consisted of fees for advisory services primarily related to government grants to a foreign subsidiary. Other fees in 2014 were for advisory services related to government grants to foreign subsidiaries and conflict minerals reporting compliance.



52
Table of Contents

OTHER MATTERS

Expenses of Solicitation

The Board is soliciting your proxy, and the expense of soliciting proxies will be borne by AAM. Proxy materials were distributed by mail by Computershare Trust Company, N.A. In addition, AAM will reimburse brokers, banks and other holders of record for their expenses in forwarding proxy materials to stockholders.

We have retained Georgeson Inc. to assist in the solicitation of proxies for an estimated fee of $11,000 plus reimbursement of certain out-of-pocket expenses. Georgeson may be contacted at (866) 391-6921.(888) 216-0459. In addition, our officers and certain other employees may solicit proxies personally or by telephone, fax or e-mail. They will receive no special compensation for these services.

Stockholder Proposals for 20142017 Annual Meeting

Under SEC rules, stockholder proposals for the 20142017 annual meeting of stockholders must be received by the Secretary of AAM at One Dauch Drive, Detroit, MI 48211-1198, on or before November 21, 201320, 2016 in order to be eligible for inclusion in the Company’s 20132017 proxy materials. In addition, AAM’s bylaws require stockholders intending to present any matter for consideration at the 20142017 annual meeting of stockholders, other than through inclusion in our proxy materials, to notify AAM’s Secretary in writing at the above address on or before February 21, 2014,23, 2017, but no earlier than February 1, 2014.

3, 2017.

Obtaining a copy of 20122015 Form 10-K

AAM will furnish to stockholders without charge a copy of our Annual Reportannual report on Form 10-K for the year ended December 31, 2012.2015. Requests should be directed to American Axle & Manufacturing Holdings, Inc., Investor Relations Department, One Dauch Drive, Detroit, MI 48211-1198, or by e-mail to investorrelations@aam.com. The 20122015 Annual Report on Form 10-K is available on our website athttp://investor.aam.com.

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53

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Using ablack ink pen, mark your votes with anX as shown in this example. Please do not write outside the designated areas.
 x
Electronic Voting Instructions
Available 24 hours a day, 7 days a week!
Instead of mailing your proxy, you may choose one of the voting methods outlined below to vote your proxy.
VALIDATION DETAILS ARE LOCATED BELOW IN THE TITLE BAR.
Proxies submitted by the Internet or telephone must be received by 1:00 a.m., Central Time, on May 5, 2016.

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Electronic Voting Instructions

Available 24 hours a day, 7 days a week!

Instead of mailing your proxy, you may choose one of the voting methods outlined below to vote your proxy.

VALIDATION DETAILS ARE LOCATED BELOW IN THE TITLE BAR.

Proxies submitted by the Internet or telephone must be received by 1:00 a.m., Central Time, on May 2, 2013.

LOGO

Vote by Internet

•    Go towww.envisionreports.com/axl

•    Or scan the QR code with your smartphone

•    Follow the steps outlined on the secure website

Vote by telephone

•     Call toll free 1-800-652-VOTE (8683) within the USA, US territories & Canada on a touch tone telephone

•     Follow the instructions provided by the recorded message

Using a black ink pen, mark your votes with an X as shown in this example. Please do not write outside the designated areas.
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qIF YOU HAVE NOT VOTED VIA THE INTERNETOR TELEPHONE, FOLD ALONG THE PERFORATION, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED ENVELOPE.q

A Proposals —
The Board of Directors recommends a vote FOR all nominees listed in Proposal 1, FOR Proposal 2 and FOR Proposal 3.
1Election of Directors:ForWithhold   ForWithhold   +
 
 
01 - Elizabeth A. Chappell
 
o
 
o
 
02 - John F. Smith
 
o
 
o
   
    ForAgainstAbstain   ForAgainstAbstain
2Approval, on an advisory basis, of the compensation of the Company's named executive officers. 
 
o
 
o
 
o
3Ratification of the appointment of Deloitte & Touche LLP as the Company’s independent registered public accounting firm for the year ending December 31, 2016.
 
o
 
o
4In their discretion, the proxies are authorized to the extent permitted by law to vote on any and all other matters as may properly come before the meeting, including the authority to vote to adjourn the meeting. 
 A Proposals —The Board of Directors recommends a voteFOR all the nominees listed in Proposal 1,FOR Proposal 2, andFOR Proposal 3.
1. Election of Directors: For Withhold    For Withhold  For Withhold +
 

 

01 - Elizabeth A. Chappell

 

 

¨

 

 

¨

 

 

02 - Steven B. Hantler

 

 

¨

 

 

¨

 

 

03 - John F. Smith

 

 

¨

 

 

¨

 
    For Against Abstain    For Against Abstain
2. Approval, on an advisory basis, of the compensation of the Company’s named executive officers. ¨ ¨ ¨ 3. Ratification of the appointment of Deloitte & Touche LLP as the Company’s independent registered public accounting firm for the year ending December 31, 2013. ¨ ¨ ¨
     In their discretion, the proxies are authorized to the extent permitted by law to vote on any and all other matters as may properly come before the meeting, including the authority to vote to adjourn the meeting.

 B Non-Voting Items

B Non-Voting Items
Change of Address — Please print new address below.
Meeting Attendance Meeting Attendance
    Mark box to the right if you plan to attend the Annual Meeting.¨å



CAuthorized Signatures — This section must be completed for your vote to be counted. — Date and Sign Below

Please sign exactly as name(s) appears hereon. Joint owners should each sign. When signing as attorney, executor, administrator, corporate officer, trustee, guardian, or custodian, please give full title.This section must be completed for your instructions to be executed.

Please sign exactly as name(s) appears hereon. Joint owners should each sign. When signing as attorney, executor, administrator, corporate officer, trustee, guardian, or custodian, please give full title. This section must be completed for your instructions to be executed.
Date (mm/dd/yyyy) — Please print date below.

Signature 1 — Please keep signature within the box.

Signature 2 — Please keep signature within the box.

    /    /          /    /          

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01L57C

02AGBA
qIF YOU HAVE NOT VOTED VIA THE INTERNETOR TELEPHONE, FOLD ALONG THE PERFORATION, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED ENVELOPE.q

Proxy — American Axle & Manufacturing Holdings, Inc.

PROXY FOR ANNUAL MEETING OF STOCKHOLDERS ON May 2, 2013

5, 2016

SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS

Richard E.

David C. Dauch and David E. Barnes, or either of them, with full power of substitution, are authorized to vote all of your shares as if you were present at the Annual Meeting of Stockholders of American Axle & Manufacturing Holdings, Inc. to be held in the Auditorium at AAM’s World Headquarters Complex, One Dauch Drive, Detroit, Michigan, at 3:8:00 p.m.a.m. on May 2, 20135, 2016 or at any adjournments of the meeting.

This proxy will be voted as you specify on the reverse side. If you do not make a choice, this proxy will be voted for the director nominees in Proposal 1, for the approval, on an advisory basis, of the compensation of the Company’s named executive officers in Proposal 2 and for ratification of the appointment of Deloitte & Touche LLP as the Company’s independent registered public accounting firm in Proposal 3.

Voting over the Internet or by telephone reduces costs to AAM. If you vote over the Internet or by telephone, please do not mail this card.

(Items to be voted appear on reverse side.)