Chrysler 2011 Annual Report Download - page 199

Consolidated
Financial
Statements
at 31 December
2011
Notes
198
At 31 December 2011 the features of the stock option plan are as follows:
Plan Beneficiary
Date of
amendment Expiry date
Strike price
(€)
N° of options
granted Vesting date Vesting portion
Stock Options
July 2004 (modified)
Chief Executive
Officer
27 March 2009 1 January 2016 6.583 10,670,000 31 December 2010 100%
On 3 November 2006 the Board of Directors of Fiat S.p.A. approved (subject to the subsequent approval of Shareholders in general meeting, which was
given on 5 April 2007) an eight year stock option plan, which granted certain managers of the Group and the Chief Executive Officer of Fiat S.p.A. the right to
purchase a specific number of Fiat S.p.A. ordinary shares at a fixed price of €13.37 each. More specifically, the 10,000,000 options granted to employees
and the 5,000,000 options granted to the Chief Executive Officer had a vesting period of four years, with an equal number vesting each year, were subject
to achieving certain predetermined profitability targets (Non-Market Conditions or “NMC”) in the reference period and may be exercised from the date on
which the 2010 financial statements are approved. The remaining 5,000,000 options granted to the Chief Executive Officer of Fiat S.p.A. also had a vesting
period of four years with an equal number vesting each year and may be exercised from November 2010. The ability to exercise the options is additionally
subject to specific restrictions regarding the duration of the employment relationship or the continuation of the position held. Finally, with regard to the
above incentive plans and in consideration of the proposed Demerger, by applying the rules of the respective plans, on 21 July 2010 the Board approved to
realign the plan with respect to the shares underlying the plan in strict relation to the allotment ratio for the Demerger and to allow the beneficiary to receive
one ordinary Fiat S.p.A. share and one ordinary Fiat Industrial S.p.A. share for each original option, with the option exercise price remaining unchanged.
The contractual terms of the plan are as follows:
Plan Beneficiary Expiry date
Strike price
(€)
N° of options
granted Vesting date Vesting portion
Stock Option
November 2006
Chief Executive Officer 3 November 2014 13.37 5,000,000 November 2007
November 2008
November 2009
November 2010
25%
25%
25%
25%
Stock Option
November 2006
Chief Executive Officer 3 November 2014 13.37 5,000,000 1st Quarter 2008 (*)
1st Quarter 2009 (*)
1st Quarter 2010 (*)
1st Quarter 2011 (*)
25%*NMC
25%*NMC
25%*NMC
25%*NMC
Stock Option
November 2006
Managers 3 November 2014 13.37 10,000,000 1st Quarter 2008 (*)
1st Quarter 2009 (*)
1st Quarter 2010 (*)
1st Quarter 2011 (*)
25%*NMC
25%*NMC
25%*NMC
25%*NMC
(*) On approval of the prior year’s consolidated financial statements; subject to continuation of the professional relationship.
With specific reference to options granted under the November 2006 Stock Option Plan, for which vesting was subject to the achievement of pre-
established profitability targets, only the first tranche (i.e. 25%) of those rights have vested as the profitability targets originally established for the 3-year
period 2008-2010 were not met.
A summary of the terms of the stock option plans outstanding at 31 December 2011 is as follows:
Managers’ compensation Compensation to the Chief Executive Officer
Exercise price (€)
Options
outstanding At
31 December 2011
Options
outstanding At
31 December 2010
Average remaining
contractual life
(years)
Options
outstanding At
31 December 2011
Options
outstanding At
31 December 2010
Average remaining
contractual life
(years)
6.583 - - - 10,670,000 10,670,000 4.0
13.370 1,636,875 2,101,250 2.8 6,250,000 6,250,000 2.8
Total 1,636,875 2,101,250 16,920,000 16,920,000