Chrysler 2005 Annual Report Download - page 229

228 Fiat S.p.A. Financial Statements at December 31, 2005 - N otes to the Financial Statements
03 Fiat S.p.A.
Prepaid expenses
These totalled 2,743 thousand euros at D ecember 31, 2005, for a net decrease of 1,785 thousand euros compared with D ecember 31, 2004,
mainly connected with the fees contractually due to TO RO C for sponsorship of the XX W inter O lympic Games, applicable to fiscal 2006.
9. Stockholders’ Equity
Capital stock
Fully paid-in capital amounted to 6,377,257,130 euros at December 31, 2005 and consisted of 1,275,451,426 shares as follows:
1,092,246,316 ordinary shares;
103,292,310 preference shares;
79,912,800 savings shares;
all with a par value of 5 euros each.
W ith reference to the capital stock, it should be mentioned that:
O n September 24, 2002 a pool of banks (see N ote 12) extended a Mandatory Convertible Facility to Fiat S.p.A. for 3 billion euros due on
September 20, 2005. According to the conditions of the facility agreement, the facility could be reimbursed by means of conversion into
ordinary Fiat shares, which the banks would be required to subscribe.
O n September 12, 2002, the Extraordinary Stockholders meeting authorised the Board of D irectors, pursuant to Article 2443 of the Italian
Civil Code, to resolve a capital increase servicing the banks’ subscription commitment as envisaged in the Mandatory Convertible Facility
agreement.
O n September 20, 2005, the facility was converted in accordance with the agreement and by previous arrangement amongst the parties.
This involved offsetting the 3 billion euros in principal owed to the banks by having them subscribe the rights offering resolved by the Board
of D irectors on September 15, 2005.
As a result of this capital increase, for 1,459,143,590 euros (from 4,918,113,540 euros to 6,377,257,130 euros), 291,828,718 ordinary shares
with a par value of 5 euros each were issued with the same characteristics as those already outstanding (including dividend rights at January
1, 2005). These newly issued shares were reserved for subscription pursuant to Article 2441, Section 7, of the Italian Civil Code to the
subscribing banks at the price of 10.28 euros each, with 5.28 euros as a share premium. Pursuant to the facility agreement, the price of
10.28 euros per newly issued share was determined as the average of 14.4409 euros (the stock market quotation of Fiat ordinary stock at
the facility date, which was subsequently adjusted) and the weighted average of official market prices for Fiat ordinary stock during the six
months preceding the due date of the facility.
Pursuant to the first three sections of Article 2441 of the Italian Civil Code and Article 134, Section 1, Legislative D ecree no. 58/98
(Consolidated Law on Financial Intermediation), the banks subsequently offered these shares to Fiat shareholders at the price of 10.28 euros
per share, at the ratio of 149 new shares for every 500 shares owned in any class.
W ith reference to the capital stock, for completeness of information it is noted that:
Pursuant to resolutions approved by the Board of D irectors on December 10, 2001 and June 26, 2003, capital may be increased through
rights offerings for a maximum of 81,886,460 euros, with the issuance of a maximum of 16,377,292 ordinary shares at a par value of 5 euros