Chrysler 2012 Annual Report Download - page 285

Notes
284 Fiat S.p.A.
Statutory
Financial
Statements
at 31 December
2012
Share-based compensation
The following share-based compensation plans for managers of Group companies and the Chief Executive Officer of Fiat S.p.A. were in place at 31 December
2012 and 2011.
Stock option plans linked to Fiat S.p.A. and Fiat Industrial S.p.A. ordinary shares
On 26 July 2004, the Board of Directors granted the Chief Executive Officer, as a part of his variable compensation, options to purchase 10,670,000
Fiat S.p.A. ordinary shares at a price of €6.583 per share. Options are vested and exercisable at any time until 1 January 2016. Following the demerger
of Fiat Industrial, he now has the right to receive one ordinary Fiat S.p.A. share and one ordinary Fiat Industrial S.p.A. share for each option held, at the
original strike price.
At 31 December 2012, the features of the stock option plan were as follows:
Plan Beneficiary
Date of
amendment Expiry date
Strike price
(€)
N° of options
granted Vesting date Vested 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 approval of Shareholders, 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
specified 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 the
achievement of certain pre-determined profitability targets (Non-Market Conditions or “NMC”) during the reference period and were exercisable from
the date of approval of the 2010 financial statements. The additional 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 were exercisable from November 2010. Exercise of the options is also subject
to specific conditions relating to duration of the employment relationship or continuation in office. Finally, in consideration of the proposed Demerger
and in accordance with the rules of the respective plans, on 21 July 2010 the Board approved amendments relating to realignment of the underlying
shares in strict relation to the allotment ratio applied for the Demerger, granting beneficiaries one Fiat S.p.A. ordinary share and one Fiat Industrial S.p.A.
ordinary share for each original option granted, 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 Vested 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
(*) Upon approval of the prior year’s consolidated financial statements and subject to continuation of the professional relationship.