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Goodyear offers to exchange old notes for new

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On Feb. 2, Goodyear Tire & Rubber Co. commenced an offer to exchange any and all of its $650 million in aggregate principal amount of 7.857% notes due in 2011 (“old notes”) for a new series of 8.75% notes due in 2020 (“new notes”).

Concurrent with the exchange offer, Goodyear is soliciting consents from the holders of the old notes to amend the terms of the indenture that governs the old notes. The proposed amendments, if adopted, would delete many of the restrictive covenants and certain events of default in the indenture governing the old notes.

Holders may not deliver consents to the proposed amendments without tendering their old notes, and holders may not tender their old notes without delivering consents to the proposed amendments. The exchange offer is not conditioned on Goodyear’s receipt of the consents necessary to effect the proposed amendments.

For each $1,000 principal amount of old notes validly tendered and accepted for exchange, and for which related consents are delivered, holders will receive $1,080 in principal amount of new notes, as well as a cash payment equal to the accrued and unpaid interest on their old notes from the last applicable interest payment date up to but excluding the date on which the exchange of old notes accepted for exchange is settled.

The new notes will be senior unsecured obligations of Goodyear and will be guaranteed on a senior unsecured basis by certain of Goodyear’s subsidiaries.  The old notes are not guaranteed by any Goodyear subsidiaries.

Goodyear is conducting the exchange offer and consent solicitation in order to effectively extend the maturity date of a portion of its indebtedness coming due in 2011.

The exchange offer and consent solicitation will expire at 11:59 p.m. on March 2, 2010, unless extended or earlier terminated by the company. Tendered notes may be withdrawn at any time prior to the expiration date.

The completion of the exchange offer and consent solicitation is subject to certain conditions described in the related preliminary prospectus, including the effectiveness of the registration statement on Form S-4 relating to the exchange offer, which has been filed with the SEC but has not yet become effective, and the requirement that Goodyear receive valid tenders, not validly withdrawn, of at least $260 million in aggregate principal amount of old notes.

"Holders of our old notes are urged to read the preliminary prospectus and the other materials related to the exchange offer and consent solicitation because they contain important information," says the company.

Copies of the registration statement, preliminary prospectus and other related materials may be obtained at no charge from Global Bondholder Services Corp., the information agent for the exchange offer and consent solicitation, at 866-924-2200 or from the SEC’s Web site at www.sec.gov.

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