Mercedes 2002 Annual Report Download - page 147

Other Notes |141
See Note 23 for shares issued upon conversion of bonds and
notes in 2002.
Because the Group reported a loss before extraordinary
items and cumulative effects of changes in accounting princi-
ples for the year ended December 31, 2001, the diluted loss
per share does not include the antidilutive effects of convert-
ible bonds and notes. Had the Group reported income before
extraordinary items and cumulative effects of changes in
accounting principles for the year ended December 31, 2001,
the weighted average number of shares outstanding would
have potentially been diluted by 10.7 million shares resulting
from the conversion of bonds and notes.
Stock options issued in 2002, 2001 and 2000 in connection
with the Stock Option Plan 2000 were not included in the
computation of diluted earnings per share for all years pre-
sented, because the options’ underlying exercise prices were
greater than the average market prices for DaimlerChrysler
Ordinary Shares on December 31, 2002, 2001 and 2000.
Income tax charges of 1263 million relating to changes in
German tax laws were included in the consolidated statement
of income for the year ended December 31, 2000 and result-
ed in a reduction of basic and diluted earnings per share of
10.26 and 10.26 in 2000 (see Note 9).
36. Related Party Transactions
The Group purchases materials, supplies and services from
numerous suppliers throughout the world in the ordinary
course of our business. These suppliers include firms in which
the Group holds an ownership interest and firms that are
affiliated with some members of DaimlerChrysler’s Supervisory
Board.
Mitsubishi Motor Manufacturing of America, a subsidiary of
Mitsubishi Motors Corporation, produces the Dodge Stratus
and Chrysler Sebring coupes for the Group. As discussed
in Note 3, DaimlerChrylser owns a 37% equity interest in
Mitsubishi Motors Corporation.
DaimlerChrysler has an agreement with McLaren Cars Ltd.,
a wholly owned subsidiary of TAG McLaren Holdings Ltd., for
the design and production of a new high-performance sports
car, the SLR, which DaimlerChrysler expects to launch by
the end of 2003. The Group owns a 40% equity interest in TAG
McLaren Holdings Ltd.
DaimlerChrysler increased its stake in the Formula 1 engine
manufacturer Ilmor Engineering Ltd. from 25% to 55% in
December 2002 and has agreed to gradually acquire the
remaining shares by 2005. The company has been renamed
Mercedes-Ilmor. Ilmor Engineering Ltd. and DaimlerChrysler
have been responsible for the development, design and
production of Mercedes-Benz Formula 1 engines since 1993,
which DaimlerChrysler supplies to the West McLaren team in
support of motor sport activities under the Mercedes-Benz
brand.
In May 2002, DaimlerChrysler Corporation sold its Dayton
thermal products facility to Behr Dayton Thermal Products
LLC, a joint venture company in which Behr America, Inc. owns
a majority interest and DaimlerChrysler Corporation owns
a minority interest. DaimlerChrysler Corporation is required to
maintain its minority interest through May 2004 and to pur-
chase products from the joint venture company under a supply
agreement entered into in connection with the sale.
The Group’s subsidiaries DaimlerChrysler Coordination Cen-
ter S.A. (DCCC) and DaimlerChrysler Aerospace AG (DASA)
granted a series of loans to debis Air Finance B.V. (dAF).
Through DaimlerChrysler’s subsidiaries DaimlerChrysler Ser-
vices AG and DaimlerChrysler Aerospace AG, the Group holds
a 45% non-controlling interest in debis Air Finance B.V. The
total book value of these loans as of December 31, 2002, was
1519 million, the highest aggregate amount outstanding
during 2002 was 1546 million. The interest rates are partially
fixed, partially based on Libor.
The Group purchases products and services from T-Systems
ITS GmbH, an information technology company. As discussed
in Note 4, the Group beneficially owned a 49.9% equity inter-
est in T-Systems through a joint venture prior to March 2002
and then decided to exit the joint venture by exercising its
option to sell its interest to Deutsche Telekom for 14.7 billion.
The sale closed in March 2002. The Group continues to pur-
chase products from T-Systems ITS.
As discussed in Note 4, in April, 2002, DaimlerChrysler
exercised its option to sell its 40% interest in Conti Temic
microelectronic GmbH to Continental. The Group continues
to purchase products from Conti Temic.
The following represent transactions with shareholders:
– DaimlerChrysler incurred expenses of approximately
$846,000 in 2002 for advertising and related marketing
activities with a U.S. magazine. Earl G. Graves, member of
DaimlerChrysler’s Supervisory Board and shareholder of
DaimlerChrysler AG, is the Chairman, Chief Executive Officer
and sole stockholder of the magazine’s ultimate parent
company.
– DB Value GmbH, a wholly owned subsidiary of Deutsche Bank
AG, owns approximately 12% of DaimlerChrysler’s outstand-
ing shares. Deutsche Bank AG and its subsidiaries provided
the Group with various financial and other services for which
they were paid reasonable and customary fees. Hilmar Kop-
per, the Chairman of DaimlerChrysler’s Supervisory Board and
shareholder of DaimlerChrysler AG, was also Chairman of the
Supervisory Board of Deutsche Bank AG until May 22, 2002.