in the First Half of 2003 98th Fiscal Year - FIAT SpA

Transactions among Group companies, whether they are made
to support vertical manufacturing integration or to provide
services, are carried out at terms that, considering the quality
of the goods or services involved, are competitive with those
available in the marketplace.
The specific mission of a Group Sector is to provide services
to other members of the Group through companies which,
because of their specialized nature, are able to achieve
continuous improvements in quality and economies of scale.
Within this framework, the main transactions between the
Parent Company, Fiat S.p.A., and its subsidiaries and associated
companies are summarized below:
❚ Licensing of the right to use the Fiat trademark, for a
consideration based on a percentage of sales, to
Fiat Auto S.p.A. (0.5%), Iveco S.p.A. (0.2%).
❚ Services provided by Fiat management personnel to Fiat Auto
S.p.A., Iveco S.p.A., Teksid S.p.A., Magneti Marelli Holding
S.p.A., Toro Assicurazioni S.p.A., Fiat Engineering S.p.A.,
Comau S.p.A., FiatAvio S.p.A. and other Group companies.
❚ Grant of suretyships and guarantees in connection with the
issuance of billets de trésorerie (Fiat France S.A.), bonds and
credit lines (Fiat Finance and Trade Ltd, Fiat Finance
Luxemburg S.A., Fiat Auto Financial Services Limited, and
New Holland Credit Company LLC); and to secure bank loans
(Fiat Auto S.p.A., Teksid S.p.A., Sicind S.p.A., Fiat Automoveis
S.A., Banco CNH Capital S.A., Case LLC, and other Group
companies), and payment obligations under building rental
contracts (Ingest Facility S.p.A., Fiat Auto S.p.A., Isvor Fiat
S.p.A., Editrice La Stampa S.p.A., Fiat Automobil Vertriebs
GmbH, International Metropolitan Automotive Promotion -
France - S.A., Fiat Motor Sales Ltd. and other Group
companies).
❚ Rental of buildings to Ingest Facility S.p.A. and Fiat I&CS S.r.l.
❚ Loans from Fiat Ge.Va. S.p.A.
❚ Purchase of support and consulting services provided by Fiat
Gesco S.p.A. (taxation and administration), Fiat Ge.Va. S.p.A.
(financial services) and Fiat International S.p.A. (international
relations).
❚ Purchase of inspection and internal auditing services from Fiat
Revi S.c.r.l.
❚ Purchase of information technology services provided by
Global Value S.p.A.
❚ Purchase of external relations services provided by Fiat I&CS
S.r.l.
❚ Purchase of support and consulting services outside Italy
provided by Fiat USA Inc., Fiat France S.A., Fiat Iberica S.A.,
Fiat do Brasil S.A. and Fiat Russia 000.
❚ Purchase of office space, personal and real property
maintenance services provided by Ingest Facility S.p.A.,
and other general services provided by Fiat Servizi per
l’Industria S.c.p.a.
31
Transactions among Group Companies and with
Related Parties
❚ Purchase of personnel training services provided by Isvor
Fiat S.p.A.
❚ Purchase of insurance services provided by Augusta
Assicurazioni S.p.A.
❚ Purchase of automobiles from Fiat Auto S.p.A.
Among transactions with related parties that need mentioning
are professional services for 2.5 million euros provided by the
Benessia-Maccagno Law Firm.
All the transactions involving intra-Group deliveries of goods
and services that are part of the normal operations of the
companies involved are discussed in other sections of this
Report (Note 19 – Other Information).
Based on the information received from the various Group
companies, there were no atypical or unusual transactions
during the period under review. Extraordinary transactions
among Group companies or with related parties are reviewed
below:
❚ In April 2003, CNH Global N.V. executed a capital increase
of $2 billion by issuing 8 million Convertible Series A
Preference shares at a price of $250 per share. The capital
increase was fully subscribed by Fiat Group companies
through the conversion into capital of financial receivables
owed by CNH Global N.V. to said companies.
The shares issued in connection with this capital increase,
which have the same voting rights as common shares and
enjoy preferential rights with regard to the allocation of net
income, are convertible into 100,000,000 common shares.
If all shares are converted, Fiat S.p.A., through its Fiat
Netherlands Holding N.V. subsidiary, will increase its interest
in CNH Global N.V. from 85.5% to 91.7%.
❚ In April 2003, Fiat Auto Holdings B.V. approved a capital
increase of up to 5 billion euros. Fiat Partecipazioni S.p.A.
has already subscribed part of its share (3 billion euros) of this
capital increase. The stockholders have the right to subscribe
the remaining 2 billion euros within October 2004. As a result
of this transaction, on June 30, 2003, Fiat Partecipazioni S.p.A.
held a 90% interest in Fiat Auto Holdings B.V.