Chrysler 2010 Annual Report Download - page 237

FIAT GROUP
CONSOLIDATED
FINANCIAL
STATEMENTS
AT 31 DECEMBER
2010
NOTES
236
The major bond issues outstanding at 31 December 2010 and classified as Discontinued Operations are the following:
Face value of
outstanding Outstanding
bonds amount
Currency (in million) Coupon Maturity (€ million)
Case New Holland Inc. USD 1,000 7.750% 1 September 2013 748
CNH America LLC USD 254 7.250% 15 January 2016 190
Case New Holland Inc. USD 1,500 7.875% 1 December 2017 1,123
Total Other bonds 2,061
Hedging effect and amortised cost valuation (8)
Total Bonds 2,053
The increase of €754 million in 2010 (excluding exchange rate differences) in Bonds classified as Discontinued Operations is mainly due to:
the issue by Case New Holland Inc. of a bond having a nominal value of US$1,500 million, maturing in 2017 and paying a fixed coupon of 7.875%,
at a price of 99.32% of its nominal value;
the early repayment of a bond with nominal of USD 500 million (originally due in 2014) made by Case New Holland Inc.
The bonds issued by the Group and classified as Discontinued Operations are governed by different terms and conditions according to their type;
more specifically these are as follows, in addition to the above-mentioned Case New Holland Inc. bond issued in 2010:
a bond issued by Case New Holland Inc., having a nominal value of US$1 billion at a price of 97.062%, falling due in 2013 and bearing fixed interest at a
rate of 7.75%, payable semi-annually;
bond issued by CNH America LLC for a total amount outstanding of 254 million of US dollars and repayable in 2016.
The unaudited prospectuses and offering circulars, or their abstracts, relating to the principal bond issues included in Continuing Operations are available
on the Group’s website at www.fiatspa.com under “Investor Relations – Financial Reports”, while the unaudited prospectuses and offering circulars, or their
abstracts, relating to the principal bond issues included in Discontinued Operations are available on the Group’s website at www.fiatindustrial.com under
“Investor Relations – Financial Reports”.
Most of the bonds issued by the Group impose covenants on the issuer and, in certain cases, on Fiat S.p.A. as guarantor, which is standard international
practice for similar bonds issued by companies in the same industry sector as the Group. Such covenants include: (i) negative pledge clauses which require
that bonds benefit from any existing or future pledges of assets of the issuer and/or Fiat S.p.A. granted in connection with other bonds or debt securities
having the same ranking; (ii) pari passu clauses, under which no obligations ranking senior to the bonds in question may be assumed; (iii) periodic disclosure
obligations; (iv) for certain bond issues, cross-default clauses which require immediate repayment of the bonds under certain events of default on other
financial instruments issued by the Group; and, (v) other clauses that are generally applicable to securities of a similar type.
The Group intends to repay the issued bonds in cash at due date by utilising available liquid resources. In addition, the companies in the Group may from
time to time buy back bonds on the market that have been issued by the Group, also for purposes of their cancellation. Such buy backs, if made, depend
upon market conditions, the financial situation of the Group and other factors which could affect such decisions.
Committed credit lines expiring after 12 months available to Continuing Operations and amounting to approximately €1.9 billion had been fully used at
31 December 2010.
In respect of Discontinued Operations, in order to provide the Fiat Industrial Group with adequate funds, new syndicated committed credit facilities for a
total of €4.2 billion were finalised during the year. These facilities were made available to Fiat Industrial Group treasuries in January 2011 once the Demerger
had become effective.