Chrysler 2008 Annual Report Download - page 63

Report on Operations Stock Options Plans62
commencing 1 June 2008. As of 1 June 2008, he also acquired
the right to exercise the remaining 3,560,000 options, having
achieved the profitability targets established for the reference
period. In relation to this plan, on 22 January 2009 the Board
of Directors decided that it was significantly in the Group’s
interests to submit to Shareholders for approval at the
forthcoming General Meeting a motion to amend the plan in
order to regain and extend its retention ability. More
specifically, the amendments relate to the reintroduction of a
vesting period, solely conditional on Mr. Marchionne remaining
in office, which shall render the options unexercisable until 31
December 2010 and extend the exercise period through to 1
January 2016, with all other conditions of the plan remaining
unchanged.
On 3 November 2006, Fiat S.p.A.’s Board of Directors approved
an eight-year plan consisting of 20 million stock options,
authorised by Shareholders on 5 April 2007, which grants
certain Group managers and the Chief Executive Officer of Fiat
S.p.A. the right to acquire a determined number of Fiat S.p.A.
ordinary shares at the price of €13.37 per share. More
specifically, 10,000,000 options were granted to employees and
5,000,000 options were granted to Mr. Marchionne - to be
vested over 4 years with one-quarter of the total being vested
each year – and are subject to the achievement of profitability
targets and are exercisable from the date of approval of the
2010 financial statements. The remaining 5,000,000 options
were granted to the Chief Executive Officer of Fiat S.p.A., also
subject to a four-year vesting period as described above, and
are exercisable from November 2010. Exercise of these options
is also subject to specific conditions relating to the length of
employment or engagement. The Board exercised its powers
under Article 2443 of the Civil Code to issue new shares, in
service of these incentive plans, to employees of the Company
and/or its subsidiaries up to 1% of share capital or a maximum
of €50,000,000 (fifty million euros) in the form of 10,000,000
(ten million) ordinary shares having a par value of €5.00 (five
euros) each, representing 0.78% of total share capital or 0.92%
of ordinary share capital, at a price of €13.37 each. This capital
increase is subject to the conditions of the Plan being satisfied.
On 26 February 2008, the Board of Directors of Fiat S.p.A.
approved the incentive plan authorised by Shareholders on 31
March 2008, which allows for the periodic granting of 4 million
stock options and/or share appreciation rights until the end of
2010. This plan is intended for managers hired or promoted
subsequent to the stock option plan established on 3 November
2006, or who, in any event, warrant additional recognition, and
is structured similarly to the 2006 plan in terms of profitability
targets, vesting and exercise. On 23 July 2008, the Board of
Directors, in execution of that plan, voted to grant 1,418,500
stock options at an exercise price of €10.24. The plan obligations
will be met through the purchase of own shares in the market
rather than through the issue of new shares.
Detailed information on all Plans is also available in the Notes
to both the consolidated and parent company financial
statements.