Chrysler 2011 Annual Report Download - page 380

379
Auditors’ Reports
Motions for AGM
9.4 Conclusions
On the basis of the considerations discussed above, the Board of Directors considers the proposed conversion ratios to be in the best interest of all
shareholders and of the Company.
Savings and preference shareholders will benefit from a conversion ratio which is higher than that implied by historical trading prices over long and short term
periods. Furthermore, the premium implied in the conversion ratios is higher than the average of comparable transactions. Finally, special shareholders, upon
waiving economic privileges and class rights, will obtain a more liquid security, traded on the market at higher valuations than the special shares and with full
voting rights attached, and will maintain the rights to receive the 2011 dividend.
The earnings attributable to the shareholders of the controlling company generated by the Group in a certain year being equal, the Conversion has a positive
effect on the earning per ordinary share. In addition, the aggregate dividend the Shareholders’ Meeting may resolve to distribute in the future being equal, the
Conversion will have a positive effect on such potential dividend per ordinary share.
Finally, it may be noticed how, since the date of the announcement, special shares classes have substantially aligned to the value implied in the proposed
conversion ratios. This alignment has eliminated the conversion premium with respect to current prices.
10. Procedures for the exercise of the Conversions
The Conversions will be carried out through Monte Titoli, which will instruct the intermediaries participating in the central depository system with whom
preference and/or savings shares are deposited; all the transfers of preference and/or savings shares to be converted will be carried out by said
intermediaries and Monte Titoli. The transactions will be carried out at no costs for the shareholders, except for the possible charge in relation to the
rounding-up, where required.
The intermediaries who hold the accounts on behalf of each preference and savings shareholders will deliver to each involved shareholder the amount of
shares arising out from the application of exchange ratios; said amount will be rounded down – where necessary – to the nearest whole unit of ordinary
shares. Fractional shares that have not been assigned following the rounding down will be monetized on behalf of the Company on the basis of the
average trading prices of the Company’s ordinary shares recorded on the market in the three days following the effectiveness of the Conversion.
The Company will take measures, to the reasonable extent, in order to safeguard the faculty by holders of just one share, upon explicit request to the
relevant intermediary, to purchase the fraction of share necessary to round up to the nearest whole unit of share, in order not to lose the shareholder
status. All other shareholders may request, upon payment of the relevant price, the rounding up of fractional shares within the limit of available fractions5.
The date of effectiveness of the Conversions will be agreed upon with Borsa Italiana S.p.A. and disclosed to the market through a notice published on the
Company’s website and on the newspaper La Stampa pursuant to article 72, fourth paragraph, of the Issuers Regulation. On that date, trading on the
Company’s savings and/or preference shares on the Milan, Frankfurt and Paris Stock Exchanges will be terminated and the newly issued ordinary shares
will begin trading on the Mercato Telematico Azionario organized and managed by Borsa Italiana S.p.A.
As a result of the Conversions, the nominal value of the ordinary shares will be increased also by means of the free capital increase described in paragraph
19 below.
11. Conditions for the Conversions to be effective
In addition to the Conversions being conditional upon the approval of the Extraordinary Shareholders’ meeting, the Conversion of the preference shares is
conditional upon the approval by the special meeting of the preference shareholders, whilst the Conversion of the savings shares is conditional upon the
approval by the special meeting of the savings shareholders, it being understood that the Conversion of preference shares and the Conversion of savings
shares are independent of each other and not cross-conditional, as further explained below.
Furthermore, the Conversion of preference shares is conditional upon the aggregate disbursement in relation to the possible exercise of the withdrawal
rights pursuant to article 2437-quater of the Italian Civil Code not exceeding in aggregate Euro 56 million. The Conversion of savings shares is conditional
upon the aggregate disbursement in relation to the possible exercise of the withdrawal rights pursuant to article 2437-quater of the Italian Civil Code not
exceeding in aggregate Euro 44 million. Therefore, the overall disbursement in relation to the possible exercise of the withdrawal rights shall not exceed
Euro 100 million.
5 The correct application of the exchange ratio will entail the non-issuance of 0.5 ordinary shares; the relevant cost will be borne by the Company.