Fiat Group - Consolidated Financial Statements and Notes - Fiat SpA

200
Consolidated
Financial
Statements
at 31 December
2011
Notes
At 31 December 2011, the contractual terms of the plan were therefore as follows:
Plan Beneficiary Number of shares Vesting date Vesting portion
Stock Grant 2009 (revised) Chief Executive Officer 4,000,000 Fiat S.p.A.
4,000,000 Fiat Industrial S.p.A.
(*) On approval of the prior year’s consolidated financial statements.
(**) Subject to remaining in the position until 1 January 2012.
1 st Quarter 2010 (*)
1 st Quarter 2011 (*)
1 st January 2012
1 st January 2012
A total nominal cost of €12 million was recognised in the income statement for this plan in 2011 (€12.4 million in 2010).
500,000 (**)
375,000*NMC (**)
1,125,000 (**)
2,000,000 (**)
Finally, on 22 February 2012, on the basis of a proposal from the Compensation Committee, the Board of Directors of Fiat S.p.A. voted to adopt a Long
Term Incentive Plan, in the form of stock grants. Plan beneficiaries will be approximately 300 executives in key positions that have a significant impact on
business results, excluding employees of Chrysler Group LLC who are covered by a separate plan. This plan will be submitted for Shareholder approval at
the General Meeting called on 4 April 2012.
The first part of the Plan (the “Company Performance LTI”) provides for the allocation of a maximum 14 million rights subject to achievement of preestablished
performance objectives, for the period 1 January 2012 to 31 December 2014, and continuation of an employment relationship with the Group.
The second part of the Plan (the “Retention LTI”) provides for allocation of a maximum 17 million rights to be assigned in three cycles: the first award would
occur in 2012 (with vesting over the 2012-2015 period), the second in 2013 (with vesting over the 2013-2016 period) and the third in 2014 (with vesting
over the 2014-2017 period). The rights will be awarded on the basis of individual performance and vesting will be subject to continuation of a professional
relationship with the Group. The CEO is a beneficiary of the Retention LTI and will receive 7 million rights under that Plan.
The Plan will be serviced with treasury shares.
Restricted Stock Unit Plans issued by Chrysler Group LLC
During 2009 the U.S. Treasury’s Office of the Special Master for Troubled Asset Relief Program Executive Compensation (the “Special Master”) and
the Compensation Committee of Chrysler approved the Chrysler Group LLC Restricted Stock Unit Plan (“RSU Plan”), which authorised the issuance of
Restricted Stock Units (“RSUs”) to certain key employees. RSUs represent a contractual right to receive a payment in an amount equal to the fair market
value of one Chrysler unit, as defined in the RSU plan. The fair value of each RSU is based on the fair value of the membership interests of Chrysler.
RSUs granted to employees generally vest if the participant is continuously employed by Chrysler through the third anniversary of the grant date. For certain
RSUs granted to employees in 2009 and in 2010, vesting occurs at the later of (i) the participant’s continuous employment through the third anniversary of
the grant date and (ii) the date on which a Chrysler IPO complete.
Further, during 2009 Chrysler established the Chrysler Group LLC 2009 Directors’ Restricted Stock Unit Plan (“Directors’ RSU Plan”). For non-employee
directors, RSUs vest ratably, in one-third increments on the anniversary of the Director’s service date, over a period of three years. Under the plan,
settlement of the awards is made within 60 days of the Director’s cessation of service on the board of directors and awards are paid in cash; however, upon
completion of an IPO, Chrysler has the option to settle the awards in cash or shares. The value of the awards is recorded as compensation expense over
the requisite service periods and is measured at fair value.
The liability from the vast majority of these awards is classified as Other current liabilities (Note 30). The liability is remeasured and adjusted to fair value at
each reporting date. The expense recognised for these awards during the seven months period June-December 2011 approximated €2 million.
Deferred Phantom shares issued by Chrysler Group LLC
During 2009 the Special Master approved the Chrysler Group LLC Deferred Phantom Share Plan (“DPS Plan”) which authorized the issuance of phantom
shares of the company (“Phantom Shares”). Under the DPS Plan, Phantom Shares are granted to certain key employees as well as the Chief Executive
Officer. The Phantom Shares vest immediately on the grant date and will be settled in cash. Chrysler will begin making payments of certain of these awards
in the first quarter of 2012. The expense recognised in connection with these plans during the seven-month period June-December 2011 approximated
€3 million.